Waymo in sales mode; Ford lets MobilEye co-brand driver assistance; and GM’s sunny view of the future. Please enjoy our auto industry and mobility briefing for 20^th July to 26^th July 2020. A PDF version can be found here.

Before you read the detail, what were my favourite stories of the past week…?

• Blinding Lights — FCA and Waymo deepened their collaboration. Waymo will only use FCA’s vans for delivery and in return, FCA will only user Waymo’s self-driving kit across its fleet. That’s a pretty big deal ahead of a merger with PSA, in addition to flying in the face of projects with BMW / MobilEye and Aurora. What could Waymo be offering to make things so tempting?
• Intentions — MobilEye (Intel) will supply Ford with driver assistance chips and gets to include its own branding inside the car — something of a first. Until now, branding has been the preserve of stereos, tyres and glazing. Does MobilEye have a serious plan to establish itself as a consumer brand? Does Ford think consumers will be more reassured to know it had some help in creating the safety system? Or is it just a clever way to negotiate a discount?
• Rain On Me — GM CEO Mary Barra expects the US economy to bounce back and doesn’t fear a second wave of coronavirus. Sounds good but also slightly at odds with much of the other commentary (and virus statistics) from the USA. I’m not trying to get into an argument about virus severity and safety protocols, I’m simply pointing out the planning implications of being badly wrong. Is she just trying to be supportive of the wider return-to-normal initiative in public, or is it her way of saying GM simply can’t afford another prolonged hiatus?

News is arranged by company and topic. Stories that apply to more than one company or topic are duplicated.

Find our archive here.

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News about the major automakers

BMW ^(history)

• Rolls-Royce’s boss suggested that the yet-to-be-unveiled Ghost will contain design features reflecting the move towards “post-opulence” – a consumer trend identified by the firm’s inhouse luxury trend research unit. Traditionalists fear not, there will still be “a sense of theatre and magic”. (BMW)

Daimler ^(history)

• Reported Q2 2020 financial results (after announcing preliminary figures last week). Group revenue of €30.2 billion fell (29)% on a year-over-year basis whilst EBIT of €(1.7) billion compared to a €(1.6) billion loss in the prior year. Free cash flow was positive and Daimler expects to make a profit in the full year. (Daimler)
• Reorganising the manufacturing and research areas so that powertrain, covering all fuel types and electrification, will sit within a single group (which will report into the R&D head). (Daimler)
  • Significance: It is unclear whether the move is to simplify reporting or something deeper — perhaps in time a divestment? Grouping all powertrain activities into a single group is not new, having been implemented and sometime unwound by other manufacturers. What gives this significance is the impending transition to electrification (in countries with good infrastructure), and the difficult choices over capital allocation and labour that this raises.
• Reckons that by 2025, 25% of new Mercedes sales will take place online. Despite this, the brand is moving relatively slowly to digitalise sales systems so that customers can use the same order details at home or in the dealer (as they can with Tesla today): by 2021 Mercedes will only operate the system in three markets. (Daimler)
• Colleagues are reportedly sniping at Daimler’s head of in-car software, telling reporters writing a near puff piece on his efforts to overhaul Daimler’s coding competence that he isn’t good at managing people. (Handelsblatt)

FCA ^(history)

• Signed an agreement for self-driving vehicles with Waymo. FCA will be the exclusive provider of vans for Waymo to use in delivery services and FCA will exclusively use Waymo’s self-driving technology for L4 (occasional self-driving) capabilities in all its vehicles. This calls into question the fate of FCA’s collaborations with BMW / MobilEye and Aurora to develop self-driving technologies. (FCA)
• FCA’s offices were search by German authorities investing emissions cheating. (Reuters)
• Images purporting to be of a near-production Alfa Romeo Tonale small all-electric SUV leaked online. (Autocar)

Ford ^(history)

• Will use Intel’s MobilEye to supply camera sensors for safety features such as automatic headlights and adaptive cruise control. As part of the deal, Ford will sport MobilEye branding inside the infotainment system. (Ford)
  • Significance: The public co-branding of certain safety systems implies that Ford is interested in pursuing this route in future (e.g. Argo) and that MobileEye sees it as useful to build the brand. It will be interesting to see whether consumers notice, now or if and when the supplier changes.
• Recalling about 25,000 cars because the power seats could scrape against the wires underneath them, 1,330 trucks because they are missing some heat shielding that stops the floor becoming hot, and a small number of cars and vans to fix faulty airbags. (Ford)
• Installing a new press line, costing $30 million, at the Craiova, Romania plant. Ford said this was so the factory wouldn’t have to import so many parts from other factories. (SeeNews)
  • Significance: With coronavirus imposing spending freezes across much of the automotive world, going ahead with an investment in a press line suggests that either Ford needs the capacity in other press shops or that it wants to be in a position to restructure other plants without Craiova being affected.
• The rave reception for the new Bronco earned CEO Hackett a puff piece interview where he talked about what hard work the turnaround of Ford has been and how happy he is that the company is on the up. (Business Insider)
• Secured a £500 million loan guarantee from the UK government. (The Guardian)

Geely (includes Volvo) ^(history)

• Volvo reported 1^st half 2020 revenue of 111.8 billion SEK (about $12.8 billion), down (14)% on a year-over-year basis. An EBIT loss of (989) million SEK (about $(113) million) compared to a 5.5 billion SEK (about $630 million) profit in 2019. The brand is expecting a fast recovery and thinks sales volumes in the second half of 2020 might match those of 2019. (Volvo)
• Volvo and Geely’s merger talks have been put on hold (Geely owns almost 100% of Volvo anyway) because of the need to finalise the latter’s listing in Shanghai, which is consuming corporate resources. (Reuters)

General Motors ^(history)

• CEO Barra isn’t worried that a second wave of coronavirus will shut factories in the USA because of the precautions her company is taking. She thinks that in 2021, sales will be at 90% of 2019 levels. (Detroit News)

Hyundai / Kia ^(history)

• Hyundai’s Q2 2020 revenue was 21,859 billion KRW (about $18.3 billion), down (19)% on a year-over-year basis. Profit before tax of 590 billion KRW (about $49 million) fell (57)%. A strong improvement in mix partially offset the massive volume reductions due to coronavirus. (Hyundai)
• Kia reported Q2 2020 revenue of 11,369 billion KRW (about $9.5 billion), down (22)% versus 2019. Profit before tax of 211 billion KRW (about $18 million) fell (68)%. Kia saw a similar positive mix to Hyundai, but not as strongly. In Q2 sales in South Korea accounted for 39% of all revenue (it was 22% in Q2 2019). (Kia)

Nissan and Mitsubishi ^(history)

• Mitsubishi reported fiscal Q1 2020/2021 (calendar Q2 2020) revenue of 229.5 billion JPY (about $2.2 billion), down (57)% on a year-over-year basis. An operating loss of (53.3) billion JPY (about $510 million) compared to a small profit in 2019. (Mitsubishi)
• Mitsubishi announced a turnaround plan. The brand will concentrate on ASEAN and hopes to leverage experience in hybrids (including the plug-in kind) in increasing market share in the region to 11%. The next priority is Africa, Oceania and South America. There is also a target to cut fixed costs by (20)% compared with 2019. (Mitsubishi)
• Mitsubishi said that the previous plan increased fixed costs by 30% but was largely successful in increasing revenue and sales (if you ignore coronavirus). The plant in Gifu, Japan, called Pajero Manufacturing, will be closed and the brand will not expand the portfolio in Europe. The plan calls for R&D spending to fall by about one third by 2022 (from 2019 levels) but capital spending will stay about the same.(Mitsubishi – look at the presentation)
• Nissan is having trouble convincing workers at the Barcelona, Spain, plant to return for work after the impending closure of the factory was announced in May. (Reuters)

PSA ^(history)

• Acquired Portuguese parts reuse specialist Amanhã Global as part of PSA vertical integration strategy to cover more of the vehicle lifecycle, in this case by providing reused parts more cheaply than brand new. (PSA)
• Opel is moving from a national sales company to an importer in Croatia, Slovenia and Bosnia-Herzegovina. (Opel)

Renault ^(history)

• Sold 672,962 vehicles in Q2 2020, a drop of (43)% versus Q2 2019. The sole highlight was the all-electric ZOE model which saw a 23% increase, despite coronavirus related shutdowns. (Renault)

Tesla ^(history)

• Reported financial results for Q2 2020. Automotive revenue of $5.179 billion fell (4)% versus 2019 whilst operating income of $327 million compared to a $(167) million loss in 2019. Tesla has now reported positive operating income and net income for the past four quarters, although most of this is explained by sales of emissions credits. Although it remains high, at $713 million, the value of advance customer deposits Tesla holds has started to fall again (it has been rising since Q3 2019). (Tesla)
• On the earnings call CEO Musk confirmed that a small car and minibus are somewhere in the product plan. He also said that the self-driving software is developing quickly – although even on his well-worn route to work he still has to take the wheel sometimes. Austin was officially confirmed as the location for the next factory. (Seeking Alpha)
• Filed a lawsuit against Rivian, accusing the firm of nicking employees and technology. (Bloomberg)
• Rumours surfaced of a project codenamed “Palladium” — said to be a powertrain overhaul for Model S and Model X, and possibly more… (Electrek)

Toyota ^(history)

• Reports that Toyota was asking for suppliers to reduce prices outside the normal negotiation window led to speculation that the company is acting in an uncharacteristically confrontational way. (Nikkei)

VW Group ^(history)

• Announced that selected partners will be able to interface with machines and IT systems at VW plants via a specialised app store created by VW, Amazon and Siemens. (VW)
• Was embarrassed by leaked tapes of secret recordings made by an unknown mischief-maker inside VW’s project team tasked with solving the 2016 dispute with supplier Prevent (who threatened VW with parts shortages unless they were granted lucrative future contracts). VW dismissed the materials, which included a variety of strong arm tactics and anecdotes about well connected movers and shakers, as scenarios. Prevent said they had no idea who made the recordings and they had never heard them. (Business Insider)
• VW Group’s executive shake-up is reportedly set to continue with the VW brand’s head of sales apparently next in the firing line. (Handelsblatt)
• Audi is working with Hager Group on bi-directional charging with the aim of developing a home charging facility that could help smooth grid demand. (Audi)

Other

• AM General, famed maker of the US Army’s Humvee, is being sold to an investment firm. (AM General)
• Twisted launched an all-electric version of the original Land Rover Defender (the company keeps a stock of bodies for rebuild). (Twisted)
• The cycling team sponsored by Ineos will be renamed ahead of the Tour de France to the Ineos Grenadiers as part of a promotional push for the forthcoming model. (Team INEOS)
• All-electric bus maker Proterra is reportedly considering an IPO. (Reuters)
• Nikola is hoping to raise around $260 million by compelling owners of share purchase options warrants to use them or lose them. (Nikola)
• AYLI plans to raise $100 million through an offering of cryptocurrency to fund the first stage of development for electric delivery trucks made of hemp and the rollout of a fleet of electric motorcycles. The cryptocurrency, called RevoltTOKEN is “entirely independent from ALYI and completely dedicated to ALYI”. (AYLI)
• Electric commercial vehicle maker Via Motors reportedly hopes to raise $250 million. (Bloomberg)
• Li Auto (formerly CHJ Automotive) updated their IPO prospectus with a target of raising $950 million, plus a further $380 million from a private placement of shares. (Nikkei)

News about other companies and trends

Economic / Political News

• The French scrappage bonus is becoming tougher to qualify for, from the beginning of August. The maximum household income will be lowered and only the lowest emitting non-electric models receive grants. (Les Echos)
• European registrations of 758,166 light commercial vehicles in the first half of 2020 fell (33.8)% compared with the same period in 2019. (ACEA)

Suppliers

• Bosch reorganised its automotive electronics and software units into one division. (Bosch)
• Battery maker CATL raised $2.8 billion. (Deal Street Asia)
• CIE Automotive’s Q2 2020 revenue was €386 million, down (57)% vs 2019. EBIT was €(14) million. (CIE)
• Nidec’s Q2 2020 revenue was 337 billion JPY (about $3.2 billion), down (7)% on a year-over-year basis. Profit before tax of 28 billion JPY (about $263 million) fell (10)%. (Nidec)
• Veoneer reported $184 million of revenue in Q2 2020, down (62)% versus prior year. The operating loss of $(64) million was actually an improvement on 2019. The company expects global industry will not make a full recovery until 2023. (Veoneer)
• Valeo reported 1^st half 2020 revenue of €7.1 billion and operating margin of €(840) million. The firm took a series of write-downs and has cut thousands of jobs. It will stop providing the indicator controls that sit behind steering wheels. (Valeo)

Ride-Hailing, Car Sharing & Rental ^(history)

• Didi Chuxing launched Huaxiaozhu, a new brand providing ride hailing for cost conscious consumers. Since Didi’s existing infrastructure, drivers and standards are used, the basis for the savings is unclear. (Auto Rental News)
• Gett raised an additional $100 million. (TechCrunch)
• Rental company fleet management service Swoop raised $3.2 million. (Swoop)
• Non-emergency medical transport marketplace Roundtrip raised $4 million. (FINSMES)

Driverless / Autonomy ^(history)

• Netradyne says it has collected data from one billion miles of driving in North America. The company’s system monitors the driver and the external environment and Netradyne believes knowledge of how drivers approach the same roads differently according to environmental conditions and physical constraints gives it the edge over others trying to understand how to teach machines to drive. (Netradyne)
• Velodyne and Hesai Photonics settled a legal dispute through a licencing agreement. (Velodyne)
• Local Motors is partnering with Beep, hoping that users of the latter’s mobility as a service platform might be more likely to purchase a vehicle that can more easily be integrated into it. (Beep)
• Radar developer Beijing Qinglei raised “millions of US dollars”. (Deal Street Asia)
• Ford will use Intel’s MobilEye to supply camera sensors for safety features such as automatic headlights and adaptive cruise control. As part of the deal, Ford will sport MobilEye branding inside the infotainment system. Ford hasn’t committed to MobilEye’s “Roadbook” map-building program, but will experiment with it. (Ford)
• FCA signed an agreement for self-driving vehicles with Waymo. FCA will be the exclusive provider of vans for Waymo to use in delivery services and FCA will exclusively use Waymo’s self-driving technology for L4 (occasional self-driving) capabilities in all its vehicles. This calls into question the fate of FCA’s collaborations with BMW / MobilEye and Aurora to develop self-driving technologies. (FCA)
  • Significance: The announcement leaves Aurora’s vision of selling to multiple OEMs seemingly in tatters, although it is still working with Hyundai-Kia.

Connectivity

• Connected vehicle software start-up Sibros raised $12 million. (Sibros)

Other

• Scooter rental is becoming blasé. Now you can subscribe to an electric bike thanks to German start-up DANCE. The only downside is that you can’t simply drop it on the pavement, because you’re the only one using it. (Reuters)

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PSA and FCA choose a new name; Porsche keeps up product spending; and will cool technology make it into your car? Please enjoy our auto industry and mobility briefing for 13^th July to 19^th July 2020. A PDF version can be found here.

Before you read the detail, what were my favourite stories of the past week…?

• In The Name of Love — PSA and FCA, once merged, will be called Stellantis. Whilst it would be odd for Ad Punctum to sneer at a Latin name, it leaves me as cold as Diageo 20 years ago. Yes, PSA might often be confused with the Singaporean ports operator, yes many think of Britain’s financial regulator when they hear FCA, but we knew they meant Peugeot, they meant Fiat (itself an acronym, I know), they meant Chrysler. Where is the romance?
• Going For Gold — Porsche’s cycle plan is unaffected by coronavirus. Bad news for competitors; the company is in the middle of a product overhaul and doesn’t want to stop. The next generation of products seems aimed squarely at Tesla, and now we can look forward to seeing them on time. How many others will be able to continue so serenely?
• New Rules — Mahle is making pistons with 3D printing. They say that, because the material structure can be varied so much, the pistons are lighter and higher performance (which you can turn into power or economy). The technology is too slow for mass manufacturing at the moment — it takes about 12 hours to print a set, and then further machining is required — but it is yet another example of the possibilities for improving internal combustion engines. Cool, but will it ever be cost effective?

News is arranged by company and topic. Stories that apply to more than one company or topic are duplicated.

Find our archive here.

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News about the major automakers

BMW ^(history)

• Launched the all-electric version of the X3, the iX3. (BMW) BMW’s CEO reckons that his company’s timing in releasing electric vehicles is “perfect”. (BMW)
• Rolls-Royce claims to have the best air filtration in the World, but rather than follow Tesla’s “Bioweapon Defense Mode” naming example, Rolls went with “MEPS”. (BMW)
• Signed a battery supply contract with Northvolt, starting in 2024 and worth €2 billion. (BMW)

Daimler ^(history)

• Daimler announced preliminary results for Q2 2020, saying that they were better than the market had expected. Group EBIT was a €1.7 billion loss and €(700) million on an adjusted basis. (Daimler)
• Will stop producing C-Class in Alabama, USA and the A-Class in Mexico. (Reuters)
• Reportedly considering offloading the Iracemápolis, Brazil, plant and a majority stake in the Lab 1886 startup incubator. Products under threat apparently include the B-Class and various niche bodystyles such as CLA shooting brake, A-Class sedan and the burgeoning coupe / cabriolet line up. (Handelsblatt)
• CEO Källenius said Volvo was a potential partner, but he had no plans to add brands to Daimler’s stable. He also sees a 700km range as the key milestone for electric vehicles in future. (Handelsblatt)

FCA ^(history)

• Unveiled an updated version of the Maserati Ghibli. (Maserati)
• After they merge, FCA and PSA will be called Stellantis. (FCA)

Ford ^(history)

• Unveiled the resurrected Bronco, a rugged SUV in the Jeep Wrangler / Land Rover Defender mould. (Ford) A softer sibling, called the Bronco Sport was also shown off. (Ford)
• Ford took a leaf out of Tesla’s book and launched a $100 refundable deposit for the early interest in the car. Executives were pleased with the down payments received, but cagey on how big they were. (Detroit News)
• Launching a branded contract hire offer for UK fleets in conjunction with ALD. (Motor Trader)

General Motors ^(history)

• Released its 2019 sustainability report. (GM)

Hyundai / Kia ^(history)

• Hyundai and Kia now jointly plan to sell one million electric vehicles a year by 2025. The prior target was 670,000 units, including fuel cells. (Reuters)
• Kia invested in a mobility joint venture called Purple M alongside Code2.ai, a South Korean transportation as a service firm. (Kia)

Nissan and Mitsubishi ^(history)

• Unveiled the production version of the Nissan Ariya all-electric SUV. (Nissan) The yearly sales target is reportedly 100,000 once all major markets have launched. (Reuters)
• Showed the Nissan Magnite SUV for emerging markets. The car is more highly styled than many entry-level rivals, which may give it a sales edge. (Autocar)
• Nissan Airya’s used of the CCS charging standard appears to be the death knell for CHAdeMO. (Inside EVs)
• Nissan has a new logo. (Design Week)
• Reportedly expects full year production to drop (30)% on a year-over-year basis. (Reuters)

PSA ^(history)

• Sold 1.033 million vehicles in the first half of 2020, down (46)% on a year-over-year basis. The company is confident that it will meet its 2020 EU fleet CO₂ target. (PSA)
• PSA’s retail arm is trialling a range of new digital capabilities, including trade-in value, upfront agreement of financing and home delivery. (PSA)
• After they merge, FCA and PSA will be called Stellantis. (FCA) Apparently, the name was the second proposal after the initial idea was shot down in January. (Les Echos)

Tata (includes JLR) ^(history)

• Tata Sons is reportedly looking to raise $1 billion to pump into various subsidiaries including Tata Motors. (Livemint)

Tesla ^(history)

• A German court told Tesla they couldn’t use the Autopilot name, or refer to the potential for fully autonomous driving. CEO Musk said maybe the term Autobahn should be ruled illegal too. (BBC)

Toyota ^(history)

• Recalling around 183,000 Tundra pickup trucks to fix problems with the indicators. (Toyota)

VW Group ^(history)

• Volkswagen’s Sitech seating unit will become part a 50/50 seating joint venture with Brose. (VW)
• Porsche’s in-house consultancy published a thought piece about capital allocation, the focus is almost purely on product selection. (Porsche)
• Porsche’s CEO says that the product cycle plan is unaffected by financial pressures from coronavirus. (Porsche)
• Imposed a hiring freeze in Germany that will last until at least the end of 2020. (Manager Magazin)

Other

• Mullen raised $135 million in debt to fund a new plant for its forthcoming SUV. (Mullen)
• Fisker confirmed it will list via a merger with a special purpose vehicle. The company claims an enterprise value of $1.9 billion and says it will get $1 billion to spend. (Fisker) The firm’s Ocean SUV will use VW’s MEB all-electric platform and batteries (hopefully) and there are eight products in the plan for launch by 2026. (Fisker)#
• Xpeng raised a further $500 million. (Xpeng)

News about other companies and trends

Economic / Political News

• European passenger car registrations during June of 1,131,843 units fell (24)% on a year-over-year basis. In the first six months, sales of 5.1 million units fell (40)% versus prior year. (ACEA)

Suppliers

• Mahle is making prototype pistons using additive manufacturing. Since each set takes around 12 hours to print, plus incremental precision machining, the technology isn’t mass production ready yet but is being used in limited-edition Porsche models. Mahle found that the ability to carefully choose where material is thicker (or thinner) inside the piston helps performance. (Mahle)
• News that Toyota has started buying high end steel from China Baowu has reported rattled the car makers Japanese steel supply base. (Nikkei)
• Linamar said the business would make a loss in Q2 2020, but not as bad as expected. (Linamar)
• TomTom reported Q2 2020 revenues (41)% lower than prior year. (TomTom)
• Grammer expects to lose around €(50) million in Q2 2020, revenue is about half. (Grammer)
• Autoliv reported Q2 2020 revenue of $1 billion and an operating loss of $(243) million. The company cut personnel costs by (25)% on a quarter over quarter basis. (Autoliv)
• Brose is forming a 50/50 joint venture for seating with VW that includes the latter’s Sitech operation. (VW)
• BMW handed Northvolt a battery supply contract worth €2 billion. (BMW)

Dealers

• Online car trader Cazoo, acquired used UK car supermarket chain Imperial Cars. (Automotive Manager)

Ride-Hailing, Car Sharing & Rental ^(history)

• Uber acquired Routematch, which provides planning software to public transport fleets. (Uber) The firm reportedly hopes to sell a $500 million stake in Uber Freight. (Bloomberg)
• Uber launched an intercity bus service in Egypt. Coupled with taxis, this could make for long distance door to door travel. (Startup MGZN)
• Subscription firm Drover raised £20.5 million. (FINSMES)

Driverless / Autonomy ^(history)

• Self-driving truck start-up Plus.ai is looking to raise $60 million. (The Information)
• VW target Navistar acquired a minority stake in self-driving vehicle developer TuSimple and the two of them will create autonomous trucks together, with a plan to launch in 2024. (Reuters)

Electrification ^(history)

• Battery supplier Britishvolt plans to site its new UK factory in St Athan, Wales. (BBC)
• Nissan Airya’s used of the CCS charging standard appears to be the death knell for CHAdeMO. (Inside EVs)
• Electric car incentives in Germany are so rich that some dealers are reportedly offering customers Renault Zoe leases for free. (Bloomberg)
• Daimler CEO Källenius sees a 700km range as the key milestone for electric vehicles in future. (Handelsblatt)

Connectivity

• Uber renewed a contract to use Google Maps. The companies agreed a change in the pricing model (which potentially incentivises Google to promote Uber’s fares above competitors. (Yahoo)

Other

• Aston Martin’s recently departed boss is back, at the helm of bus maker Optare. (Autocar)
• Cost estimating firm Munro is selling a detailed report for the BMW i3 for $10. Although the product is dated, the thinking about vehicle cost structure is contemporary. Anyone interested in how to think about vehicle cost should consider it. (Munro)

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Calling for a dynamic duo; the power of Ad Punctum; and you can’t lose sales if you have no revenue. Please enjoy our auto industry and mobility briefing for 6^th July to 12^th July 2020. A PDF version can be found here.

Before you read the detail, what were my favourite stories of the past week…?

• This Is How It Sounds — Ineos expressed an interest in taking over Daimler’s Hambach, France, factory, putting the original plants in Portugal and Wales, UK, on ice. The attraction isn’t totally clear. Whilst Daimler will be sure to offer a splendid dowry, Hambach appears much bigger than Ineos’s ambitions. Given Magna’s existing presence on the site (and the latter’s experience building the G-Class), could a joint bid be on the cards?
• I’ve Got The Power — VW’s head of software is reportedly set to be replaced. Coming just one week after I drew attention to the incoherence between comments he made in an interview, and corporate goals, I worried that I might be responsible. Happily, no one at Wolfsburg took any notice of that and it was for entirely different reasons. Or was it?
• Hand In My Pocket — Karma raised $100 million, Fisker raised $50 million, Li Auto (aka CHJ Automotive) filed for an IPO and investors chucked $2.5 billion Rivian’s way. There still seems to be plenty of money available for those with an interesting enough concept, despite the slender chances of success. Perhaps, at a time when coronavirus means no one is making money anyway, being pre-revenue or sub-scale doesn’t matter?

News is arranged by company and topic. Stories that apply to more than one company or topic are duplicated.

Find our archive here.

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News about the major automakers

BMW ^(history)

• Sold 485,701 cars in Q2 2020, (25)% down on prior year. In China, BMW sold 212,617 cars, up 17% year-over-year and down (6)% on a year to date basis. (BMW)
• Signed a contract for Moroccan cobalt. The deal size (€100 million) implies that BMW expects to spend about €500 million on the material between 2020 – 2025. (BMW)

Daimler ^(history)

• Sold 461,949 cars in Q2 2020, down (24)% versus Q2 2019, and 61,358 vans, down (34)%. Mercedes was keen to talk about the recovery in China, where sales of 207,107 units were up 22% on the prior year (on a year to date basis they are almost flat). (Daimler)
• Daimler’s HR chief thinks the firm may need to cut more than the 15,000 jobs currently planned. (Automotive News)
• Ineos emerged as a candidate to take over the Hambach, France, factory. (BBC)

FCA ^(history)

• Recalling 1.2 million vehicles, 925,239 of which in the USA, because clips around the air bag could become loose and be propelled into the cabin if the air bags went off. (FCA)
• A judge dismissed GM’s lawsuit against FCA (GM contends that FCA bribed union officials to agree to pay conditions that indirectly harmed GM). GM intends to appeal. (Reuters)

Ford ^(history)

• Working with startup ReJoule to create processes for automatically grading used electric vehicle batteries, to determine their suitability for used in stationary storage. (ReJoule)
• After a group of employees demanded that Ford stop supplying police forces with vehicles, the CEO wrote to them saying the firm would carry on but that their concerns had helped him write a note back to them. (Fox)
• Complained that coronavirus-related safety rules in Mexico were stifling production and risking plant stoppages elsewhere. (Reuters)

Geely (includes Volvo) ^(history)

• Geely’s Chinese brands sold 324,419 cars in Q2 2020, up 14% on a year-over-year basis. Within these results, Lynk&Co sold 36,320 cars, up 35%. (Geely)
• Volvo invested in Circulor, a firm using blockchain to trace the source of raw materials. (Volvo)
• Lotus is opening a new chassis and body shop in Norwich after outgrowing existing facilities. (Lotus)

General Motors ^(history)

• Appointed a new head of the North American business, his predecessor is leaving GM. (GM)
• A judge dismissed GM’s lawsuit against FCA (GM contends that FCA bribed union officials to agree to pay conditions that indirectly harmed GM). GM intends to appeal. (Reuters)

Honda ^(history)

• Handed a battery supply deal to CATL and took a 1% stake in the firm. (Honda)

Hyundai / Kia ^(history)

• Kia is launching an app that lets prospective customers have a video call with staff at the dealership, who can show them around the car and answer any questions they have. (Kia)

Nissan and Mitsubishi ^(history)

• Workers at Nissan’s Sunderland plant are in uproar after the company said it wanted to end the defined benefits pension scheme (which only applies to employees who joined before 2003). (Sunderland Echo)

PSA ^(history)

• PSA’s van plant in Luton, UK, has taken on an additional shift. (Just Auto)

Renault ^(history)

• Turning to Google for help with analysing production data generated at Renault’s factories. (Google)

Tata (includes JLR) ^(history)

• Tata’s Q2 wholesales of 91,594 units – of which JLR was 65,425 cars — fell (64)% compared with Q2 2019. (Tata)
• DHL is reportedly contemplating laying off up to 2,200 logistics workers dedicated to JLR facilities. (Bloomberg)
• Jaguar applied to trademark “EV-Type”, spurring speculation over what type of car might use the name. (Autocar)

Tesla ^(history)

• CEO Musk said Tesla had overcome the fundamental challenges behind self-driving cars and was confident that the firm would have “basic functionality” this year. (Sky News)
• Elon Musk tweeted that the Model Y produced in Germany would be a revolution in body engineering, implying that either the design or the manufacturing process will be different to the US-built model. (Clean Technica)

Toyota ^(history)

• Unveiled a minor freshening to the Lexus LS. (Toyota)
• Toyota’s UK sales in June were up on 2019 levels, with hybrid vehicles driving much of the performance. Almost two thirds of Toyota brand sales are hybrids (including non plug-in models), for Lexus it was over 99%. (Toyota)
• Unveiled the Toyota Corolla Cross SUV, a cheaper alternative to the RAV4. (Toyota)

VW Group ^(history)

• Completed (and passed) the third and final compliance audit imposed by US regulators after the diesel scandal. (VW)
• Unveiled a near-production “concept” of a coupe version of the forthcoming all-electric Audi Q4. (Audi)
• The head of VW’s TRATON truck unit is stepping down. (VW) So is Škoda’s CEO. (Škoda)
  VW’s head labour representative doesn’t think further headcount reductions are required, saying that plans put in place in 2016 (and still underway) will be sufficient to deliver the savings the company needs. If demand drops further, he sees short time working as the way to trim overheads. (Reuters)
• VW’s software head is reportedly to be replaced. (Handelsblatt)
• CEO Diess reportedly told top managers the electric version of the VW Up! loses €4,000 – €5,000 per unit on a contribution margin basis (i.e. before considering fixed costs), and that figures for the outgoing electric Golf were similarly bad. (Business Insider)

Other

• Fisker raised $50 million. (Fisker) There was speculation that the company could go public via a merger with a listed special purpose company, in the same manner as Velodyne’s recent listing. (Reuters)
• Karma raised $100 million. (Bloomberg)
• Li Auto (formerly known as CHJ Automotive) filed for an initial public offering. (SEC)
• Rivian raised a whopping $2.5 billion. Existing investor Ford didn’t participate. (Rivian)
• Ineos put plans for factories for the Grenadier SUV in the UK and Portugal on hold, saying it was interested in Daimler’s Hambach plant and that the Welsh government hadn’t delivered on promised infrastructure improvements. (BBC)

News about other companies and trends

Suppliers

• Linamar doesn’t expect global light vehicle production to match 2019 levels until 2024. (Linamar)
• Aftermarket accessories supplier Voxx International acquired most of rival Directed’s automotive business. (Voxx)
• A rescue deal for Amtek Auto was given the go ahead by Indian bankruptcy courts. (Economic Times of India)

Dealers

• Indonesian used car marketplace TiinTiin.id raised $2.5 million. (Nikkei)

Ride-Hailing, Car Sharing & Rental ^(history)

• Uber’s CEO says the business will be 50/50 ride hailing and other delivery services in future. (Business Insider)
• Indian ride hailing service Blu Smart raised $5 million. (Deal Street Asia)

Driverless / Autonomy ^(history)

• WeRide, backed by Renault-Nissan-Mitsubishi’s VC fund, said it will begin operations without safety drivers in its autonomous test vehicles. (Reuters)
• Intel is launching an autonomous ride hailing service in conjunction with Japanese firm Willer. (Intel)
• LeddarTech acquired sensor fusion company VayaVision. (LeddarTech)
• Autonomous shuttle developer Navya has started to withdraw the safety operators that were a feature of its service. The vehicles operate on a closed course and the safety operator was responsible for reassuring passengers, rather than driving the shuttle. (Navya)
• Aurora has developed a new lidar unit, based on technology the firm acquired when it bought Blackmore. Although technical specifics were thin on the ground, Aurora have previously claimed over 300 metres of range, even for objects with poor reflectivity. (Aurora)
• Amazon is reportedly planning to spend $100 million to retain key staff at Zoox. (Reuters)
• Faraday Future thinks that self-driving is only possible (for the foreseeable future) with “a few hundred thousand dollars of sensors — cameras, radars, LIDARs, etc. — and a computer system in the trunk that generates so much heat that it takes a heavy cooling system to keep it running”. (Faraday Future)
• CEO Musk said Tesla had overcome the fundamental challenges behind self-driving cars and was confident that the firm would have “basic functionality” this year. (Sky News)

Other

• Motorcycle maker Harley Davidson is shedding 700 staff. (Harley Davidson)
• Ampere Vehicles (owned by Greaves Cotton) acquired e-rickshaw builder Bestway Agencies. (Deal Street Asia)

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Teeny tiny trials to reuse electric vehicle batteries; the troubling case of falling Model S and Model X sales; and VW’s plan for not so open source software. Please enjoy our auto industry and mobility briefing for 29^th June to 5^th July 2020. A PDF version can be found here.

Before you read the detail, what were my favourite stories of the past week…?

• Do It — GM and SAIC’s joint venture built a grid power storage unit using old electric vehicle batteries. Although 1,000 kWh sounds a lot, it only represents the second life batteries from about 20 cars. Given the near universal agreement that stationary storage holds promise, why (Tesla aside) are they pursuing such tiny schemes rather than investing a little more and building something bigger and more interesting?
• Viva Forever — Investors were delighted that Tesla’s production only dropped (20)% in Q2 2020, sending shares skyrocketing (again). But, looking deeper, Model S and Model X saw production fall (60)%. Since they are made in the same factory as the smaller Model 3 and Model Y, on a different production line, there isn’t any obvious logistical reason for the worse performance. Is a competitor stealing sales or have Tesla just decided to let them fade away?
• Right Back At Ya — a few weeks ago, VW made a lot of noise about a plan to let others use the new vehicle operating software they have been working on. Of course, they said, it made sense that they would have to be the system architects. Just to make sure someone was in charge, you see. Last week, their software boss said that control was necessary to maintain competitive advantage. How do VW expect to convince rivals to join them?

News is arranged by company and topic. Stories that apply to more than one company or topic are duplicated.

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News about the major automakers

BMW ^(history)

• CEO Zipse says BMW is taking sustainability to a “whole new level”. Although specifics were thin on the ground, they include meeting regulatory targets for CO₂ emissions from vehicles (still on track, despite coronavirus he says) and focusing on the emissions of battery cell manufacturing. BMW reckons this traditionally accounts for 40% of an electric vehicle’s CO₂ emissions and has told suppliers of its next generation batteries that they must use renewable energy for production. (BMW)
• Rolls-Royce says that coronavirus has accelerated a shift towards “post-opulence”, reckoning that customers in future want a luxury that focuses on purity and exacting design. (Autocar)

Daimler ^(history)

• Announced an agreement (as rumoured) with Farasis Energy to supply batteries. Daimler will also take a 3% stake in the supplier and receive a board seat. As part of the deal, some of the batteries will be produced with renewable energy (though not all, as BMW are committing to). (Daimler)
• Wants to offload the Hambach, France, factory (the traditional home of the Smart brand). The plant’s assets will be written down in the Q2 2020 financial results. (Daimler)
  • Significance: Daimler’s intention to sell the plant as a going concern suggests a handful of buyers: Geely or one of the specialists contract manufacturers (e.g. Magna, Valmet)
• Ending the “Collection” short term leasing (subscription) program, which was only available in selected US cities, citing poor user figures. (Automotive News)

FCA ^(history)

• Reported Q2 2020 US sales of 367,086 units, (39)% worse than prior year. FCA blamed economic “havoc” wrought by coronavirus but, happily, it now has a strong order book of fleet sales to cover the next few months. (FCA)
• Issued €3.5 billion in debt to replace the (higher cost) credit facility that it drew in April 2020. (FCA)

Ford ^(history)

• Sold 433,869 vehicles in the USA during Q2 2020, a drop of (33)% on a year-over-year basis. As with FCA, Ford wanted to highlight that retail sales fared relatively well – down (14)% YoY. (Ford)
• Booked slots across Disney’s entire US network for the Bronco’s reveal, meaning millions of Americans will have to watch whether they like it or not. (Ford)
• The Mustang Mach E will have a more powerful motor than previously announced. (Ford)
  • Significance: The upgraded specification shows that Ford are still learning about how hard they can push the powertrain components. Lessons that others have already learned
• Confirmed that production of the slow-selling Lincoln Continental will end this year. (Fox)

Geely (includes Volvo) ^(history)

• Geely is reportedly looking to take over motorcycle maker Lifan. (Reuters)

General Motors ^(history)

• Delivered 492,489 vehicles in the USA during Q2 2020, down (34)% versus Q2 2019. (GM)
• Delivered over 713,600 units in China during Q2 2020, about (5)% worse than the same period last year. Results by brand were mixed: Buick and Wuling saw sales increases, all other brands dropped. (GM)
• GM-SAIC’s Wuling brand has built a stationary storage facility from old electric car batteries. The size, 1,000 kWh or about 20 reused car batteries, shows it is still a pilot facility. (GM)

Hyundai / Kia ^(history)

• Hyundai sold 684,683 vehicles in Q2 2020, down (38)% versus prior year. (Hyundai)
• Hyundai Mobis invested $20 million in two Silicon Balley-based VC funds. (Hyundai Mobis)

PSA ^(history)

• PSA’s wholly owned dealer group PSA Retail is closing several sites in Paris, blaming low retail sales and high property costs. By beefing up sites in the suburbs and offering drop offs to customers at their homes, PSA hopes that there will be minimal sales losses. (PSA)
• Using vehicle data to tailor insurance premiums for French owners. Compared to Tesla’s recent, similar offering, PSA is more conservative on the value of savings, focusing on the second year, but targeting a wider user group, around five million vehicles. (PSA)

Suzuki

• Unveiled the Across, a midsize SV based on the Toyota RAV4. (Autocar)

Tata (includes JLR) ^(history)

• Revised the subscription model it offers via Pivotal (aka Carpe) from a 12 month contract to a 3 month lock-in. Prices have also been dramatically lowered – monthly fees on a Range Rover Sport have fallen from over £2,100 to £1350 (although there is now a sign-up fee). JLR says 80% of people using the scheme are new to the brand. (JLR)
• Rumoured to be planning to decide on Ralph Speth’s successor as CEO in the coming days, with a series of ex-German premium OEM executives in the running alongside JLR internal candidates. (FT)
• JLR’s engineering boss implied that the firm is interested in diesel plug-in hybrid variants. (Autocar)
  • Significance: Although there is no technical reason why diesel could not be used in place of petrol/gasoline for a plug-in hybrid car, thus far manufacturers have favoured petrol because the exhaust technology required to meet particulate emissions requirements is cheaper than for diesel, thus reducing overall system cost. However, the overall fuel economy logic relies on the assumption that the vehicle usage is mainly for short journeys — not true for all customers.

Tesla ^(history)

• Tesla built 82,272 cars in Q2 2020, a (20)% drop versus prior year. Deliveries of 90,650 units fell only (5)%. The results were generally better than market analysts had assumed but Model S and X production dropped almost (60)% from the prior quarter whilst smaller vehicles dropped by only (13)%. Since the larger vehicles have higher margins and are built on a separate line, a drop in demand seems the likely cause. (Tesla)

Toyota ^(history)

• Created a special machine to reduce waste in the plating of components. Instead of being dipped in a bath, components are plated by being held in a special tool that only plates a set design or area. (Toyota)
• Participating in a fund with several Japanese banks to encourage projects in space. The total fund size is relatively modest – about $140 million. (Toyota)
• Toyota Tsusho invested in battery developer APB Corporation. (Toyota)
• The head of Toyota’s AI Ventures VC unit wrote a blog post about his unit’s strategy. (Toyota)
• Blamed battery supply problems for a decision to constrain supply of the recently launched RAV4 plug-in hybrid to 5,000 cars. Toyota hopes that next year it will be able to produce four times as many. (Inside EVs)
• Invested in a new round of existing portfolio company, robotics start-up Elementary Robitics. (FINSMES)
• Announced a new structure for the most senior executives. The absolute top rank of operating officer will be reserved for chief… executives (including the CEO), whilst the next tier will be named “senior professional / senior management”. (Toyota)
  • Significance: Unlike some other organisations, Toyota has not made specialists in strategy or on-demand mobility top tier executives. The most similar is the chief digital officer who controls the advanced R&D function.

VW Group ^(history)

• Porsche invested in serva transport systems, a maker of autonomous factory logistics robots. (Porsche)
• Unveiled a facelift for the VW Tiguan SUV. (VW) The Audi Q5 also got some changes. (Audi)
• Has a team of 60 computer vision specialists working on ways to improve manufacturing efficiency using cameras and machine learning. (VW)
• Reportedly cancelled plans for a new factory in Turkey. (Reuters)
• VW’s recent announcements that it was hoping to build an open source vehicle operating system that could be shared by competitors were somewhat undermined by the executive in charge of the software saying control of the architecture was the only way to ensure competitiveness in the future. (Autocar)
• Audi is working with German energy generation firm EnBW to develop stationary storage units that can be sold alongside EnBW’s generation equipment. (Reuters)

Other

• Nio delivered 10,331 cars in Q2 2020, up 191% on a year-over-year basis. The sales increase is mainly due to the launch of the ES6, which only started sales in June 2019, but a redesigned ES8 also saw an uptick in orders. (Nio) Nio also confirmed that it had received the first tranche of cash to shore up its Chinese operations. (Nio)
• Byton is shuttering operations for an unspecified period of time to restructure the business. (Automotive News) Fellow Chinese electric vehicle start-up Bordrin and the Chinese sponsored rebirth of Saleen are also said to be in trouble. (Automotive News)
• Electric commercial vehicle maker Workhorse raised $70 million. (Workhorse)
• Ineos unveiled the Grenadier rugged off-roader. (Ineos)
• Karma rebutted claims that it was considering chapter 11 bankruptcy and specifically committed not to reduce its staffing level to only 38 people — seemingly leaving the door open for redundancies, provided they didn’t reach that figure. (Karma)
• SAIC is buying a nearly 29% stake in Hong Kong car rental business CAR Inc. (Deal Street Asia)

News about other companies and trends

Economic / Political News

• US light vehicle industry in June of 13.05 million units fell (25)% on a year-over-year basis. (Wards)
• German passenger car registrations of 220,272 units in June fell (32)% from prior year. (KBA)
• UK June passenger car registrations of 145,377 units fell (35)% on a year-over-year basis. The fall was in part due to dealers not reopening in Scotland and Wales until later in the month. (SMMT)
• French passenger car registrations of 233,820 units, up 1.2% on June 2019, but (8.4)% on equivalent selling days. (CCFA) Theautomotive stimulus is going great guns. Half of the available 200,000 grants have already been claimed and the government expects the program to be exhausted by the summer. (Les Echos)
• Spanish passenger car registrations of 82,651 units fell (37)% year-over-year. (ANFAC)
• Italian passenger car registrations during June of 132,457 units fell (23)% versus prior year. (UNRAE)
• The Geneva motor show has been cancelled for 2021 but the London motor show will go ahead. (Autocar)
• India’s road and industries minister said the country will shortly announce new rules for recycling of key raw materials used in vehicles. (Economic Times of India)
• Moody’s says that because it has only downgraded nine out of the 22 large automakers it tracks, companies must be in better shape that the financial crisis. (Economic Times of India)
• China is removing caps on foreign ownership of commercial vehicle makers, similar to the changes made to passenger vehicle companies. (China Daily)

Suppliers

• Motherson is undertaking a restructuring of its subsidiaries. (Autocar)

Dealers

• DigniFi, which provides financing for service and repair jobs, raised $14 million from investors including Exor (major shareholder in FCA and Ferrari). (FINSMES)

Ride-Hailing, Car Sharing & Rental ^(history)

• After failing to buy GrubHub earlier in the year, Uber agreed to acquire food delivery service PostMates in a $2.6 billion deal. (Uber)
• Multimodal service Skipr raised €7 million. (FINSMES)
• Parking monitoring firm AIpark raised $42 million. (Deal Street Asia)

Driverless / Autonomy ^(history)

• Lidar developer Velodyne listed by merging with a special purpose vehicle, valuing the company at $1.8 billion and leaving it with cash of around $200 million. (Velodyne)
• Autonomous taxi developer Momenta says it will have driverless vehicles on the road by 2022 and all the cars in its fleet will operate without safety drivers by 2024. (TechCrunch)
• Lyft’s self-driving division says that it uses route data from cars in service to prioritise features, implying that the company could determine appropriate geofences to target for initial robotaxi deployment. (Lyft)
• GM’s Cruise self-driving unit published a blog post explaining the background to the moveable radar sensors mounted on the car’s wing mirrors. (GM)
  • Significance: In addition to the sensory capability, the units serve as an obvious way to communicate to other road users what the vehicle is focusing on and what it plans to do next, something Cruise do not yet appear to be working on.

Electrification ^(history)

• Wireless vehicle charging developer ElectReon raised $50 million. (ElectReon)
• Norwegian firm Freyr reckons it has enough money to break ground on a new battery factory. (Freyr)
• Charging network FastNed acquired smaller rival MisterGreen. (Inside EVs)
• Bharat Forge wrote down its investment in electric motor start-up Tevva Motors saying the commercial outlook for the firm is uncertain. (Autocar)

Other

• The UK government will let fleet operators offer short term rental of electric scooters (hitherto illegal on public roads) to consumers. (UK government)

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