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.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

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)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

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.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

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)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

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.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

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)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

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.

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

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)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

VW thinks about buying its former rental unit; Aston Martin the cash guzzlers; and should we bow to the inevitable dominance of Google? Please enjoy our auto industry and mobility briefing for 22^nd June to 28^th June 2020. A PDF version can be found here.

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

• Trouble Man — VW is reportedly thinking about making a bid for, troubled former subsidiary, rental company Europcar. Major daily rental has always sat uncomfortably with the capital intensive on-demand mobility strategies employed by OEMs in recent years. If services that looked very similar (subscription, car sharing) were in scope, why not rental? Would an acquisition be a smart way to secure a sales channel for electric vehicles and spare capacity, or will the rental business demand incentives, refuse to only buy the parent’s products, and spend money on a market share grab (which is why OEMs offloaded them in the first place)?
• More Than A Feeling — Aston Martin announced another rights issue, this time raising £150 million. Despite positive messages from the management team, raising £650 million since January, plus debt on top, shows that it is easy enough to burn through large sums in a short time period. If this latest amount isn’t enough, where next?
• It’s Nice To Have A Friend — Volvo announced a deal to use Waymo’s self-driving kit, and that it will build a robotaxi with the technology. The growing list of Waymo partners (JLR, FCA, Renault etc) suggests that reasonable commercial terms are on offer. If that is the case, then why spend billions independently trying to develop the technology? Will the collectively cash-strapped Renault-Nissan-Mitsubishi alliance (who already have a friendly relationship with Waymo) be next?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

BMW ^(history)

• Opened a new additive manufacturing centre, with plans to make 60,000 parts each year. (BMW)
• Will use a new technology in Apple devices that means a phone can double as a car key. (BMW)
• Workers representatives on BMW’s board are pushing for the firm to change strategy and produce a platform dedicated to electric vehicles. (Reuters)

Daimler ^(history)

• Shortly after calling off a plan to develop self-driving features with BMW, Daimler announced a deal with chipmaker Nvidia to create an upgradeable driver assistance suite that will launch in 2024. The partners intend to develop SAE L2 and L3 technologies and a fully automated parking assistant. (Daimler)

FCA ^(history)

• Received a €6.3 billion credit facility, 80% backed by the Italian government, that will be spent on actions to improve the competitiveness of FCA’s plants in Italy. (FCA)
• Hailed the performance of its brands in US quality surveys. Dodge had the (joint) best initial quality (i.e. when the car is still nearly new) in the survey. (FCA)
• A judge ordered FCA CEO Manley and GM CEO Barra meet face-to-face to resolve a civil case brought by GM claiming damages because FCA’s relationship with union leaders inflated costs (through the pattern bargaining agreements including things that GM hated but FCA didn’t mind). (Reuters)

Ford ^(history)

• Unveiled the new F-150 full-size pickup which continues with an aluminium body on a steel frame. There are a host of new features, seemingly aimed at builders and explorers, including a ruler integrated into the plastic of the tailgate (might be useful, costs nothing to implement). The truck will also get Ford’s forthcoming hands-off, but eyes-on, driver assistance suite. Ford confirmed a (non plug-in) hybrid version but withheld details on the all-electric model until a later date. (Ford)
• Published its latest sustainability report and announced a goal for all Ford’s vehicles and operations to be carbon neutral by 2050. The goal does not imply all cars will have zero emissions (i.e. be fully electric or fuel cell), instead suggesting carbon capture as a possible strategy. Ford has stopped reporting any of the results from its internal employee satisfaction survey. (Ford)
• Thinks that collaboration will be necessary for manufacturers to offer a full range of electric vehicles. (Autocar)
• Recalling slightly under 3,000 SUVs in North America because the headrest on the seats could come loose in an accident  and a handful of large pickup trucks because one of the powertrain parts might not be structurally sound after a manufacturing process was missed. (Ford)
• Announced the creation of a new UK 5G network with Vodafone and other partners. Connected vehicle enthusiasts will be disappointed though; the purpose is to connect manufacturing machines rather than cars. (Vodafone)

Geely (includes Volvo) ^(history)

• Geely unveiled the Hao Yue large SUV. Available in 5 and 7 seat configurations, the car appears very similar to the Volvo XC90 with different sheet metal. (Geely)
• Volvo announced a deal with Waymo (Google) for L4 self-driving technologies, and that the two companies will partner on an electric taxi. (Volvo)

General Motors ^(history)

• Won a contract to supply the US army with new infantry vehicles that cost a cool $330,000 apiece. (GM)
• A judge ordered FCA CEO Manley and GM CEO Barra meet face-to-face to resolve a civil case brought by GM claiming damages because FCA’s relationship with union leaders inflated costs (through the pattern bargaining agreements including things that GM hated but FCA didn’t mind). (Reuters)

Hyundai / Kia ^(history)

• Hyundai-Kia and LG Chem will collectively fund promising battery start-ups. (Kia)
• Hyundai and LG Chem are reportedly contemplating a battery making JV in Indonesia. (Reuters)

Mazda

• Recalling around 24,000 Mazda 3 and CX-30 because the bolts that hold the braking system on may not have been tightened properly. (Mazda)

PSA ^(history)

• Opel will disband the national sales company in Bulgaria and use an importer instead. (PSA)
• Unveiled the new Mokka compact crossover. The line-up includes an all-electric version but with pricing not yet published it isn’t clear whether PSA intend to go head-to-head with similar forthcoming models from VW or the car will be sold selectively (e.g. management scheme). (PSA)
• Unveiled the new Citroën C4, which will come with a range of powertrain options including plug-in hybrid and all-electric. (Citroën)

Toyota ^(history)

• Recalling around 270,000 Prius in the USA because the car might overreact to a fault in the hybrid system and shut down the engine. (Toyota)
• Investing in automated forklift company Third Wave. (Toyota)
• Invested in cashless payments company Synqa Holdings. (Nikkei)

VW Group ^(history)

• Reportedly contemplating the re-acquisition of rental group Europcar, which VW sold in 2006. (FAZ)
• Bentley has cut spending on new combustion engine models, rather than affect plug-in hybrid and fully electric cars, the plans for which are “full steam ahead”. (Autocar)
• Thinks it will take until at least 2022 for car sales to recover. (Reuters)
• Unveiled a minor refresh of the VW Arteon, and a shooting brake version. (VW)

Other

• Greek firm Spyros Panopoulis Automotive is planning a new hypercar called Apeiron with a top speed of over 310 mph. Unusually for new sportscar entries, it will be powered by an internal combustion engine. (CarBuzz)
• Mahindra worries about new tariff barriers but thinks that sourcing to multiple suppliers to overcome trade problems could increase costs by 15% – 20%. (Economic Times of India)
• Aston Martin announced a £152 million rights issue. (AML)
• The CEO of Lordstown Motors says the first year’s production is sold out. (Yahoo)

News about other companies and trends

Economic / Political News

• European vehicle manufacturers trade body ACEA expects the passenger car market to drop (25)% in 2019 compared with the prior year. (ACEA)
• The UK trade body, the SMMT, worries that one in six car industry jobs (including dealers and servicing centres) could be lost through a combination of a post-coronavirus recession and an unhelpful outcome in the EU-UK trade talks. (BBC)
• The EU published provisional data on CO₂ emissions for passenger cars in 2019 showing average emissions of 122 g / km CO₂ – some way above the 95 g / km level that starts to phase in (through a complicated series of rules) this year. Data for vans was also published, showing some work left to do to close the gap to target. (EU)
  • Significance: Ad Punctum’s contention is that manufacturers have all the technology to meet 2020 and beyond targets, and the cost of that technology is lower than the fines they will have to pay for breaching the regulations. Therefore compliance makes business sense. Data from early in 2020 suggesting electric vehicle shares were climbing substantially, consistent with this hypothesis. The corollary is that 2019 represented something of a peak for legacy technology.

Suppliers

• Martinrea says it will still pay a divided, after agreeing with lenders that Q2 financial performance won’t be part of the calculations about its loan covenants. (Martinrea)
• Adient said that Yanfeng would pay a little bit less for the JV assets it was taking over, and the money would be paid a bit later too. (Adient)

Dealers

• UK online used car dealer Cazoo raised £25 million and says it is worth over $1 billion. (Cazoo)

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

• Chinese high end car rental company JF Chuxing raised $10 million. (China Money Network)

Driverless / Autonomy ^(history)

• As rumoured, Amazon acquired Zoox, suggesting that the firm will still create vehicles for moving people (just perhaps with packages in the back too). The value wasn’t disclosed. (Amazon)
• Didi Chuxing is aiming to have one million robotaxis in service by 2030. (Reuters)
• Oxbotica is developing AI that will create altered images from photographs taken by test vehicles, so that more variety can be tested, with the aim of accelerating testing times. (Autocar)
  • Significance: Whilst this solution seems neat, computers interpret photographs very differently to human eyes (they use data about the colour, brightness etc of the pixels) so however convincing observers might find the techniques, they may be unsuitable for recreating what a vehicle sensor set detects.
• DriveU, which develops communications networks for remote vehicle operation, raised $4 million. (DriveU)
• Lyft released a dataset of traffic movements around autonomous test vehicles, hoping to spur innovation in predicting the movement of fellow road users. (Lyft)
• Driver monitoring start-up ADAM CogTech raised $2 million. (CTech)
• Self-driving truck developer TuSimple reportedly hopes to raise $250 million. (TechCrunch)
• Volvo announced a deal with Waymo (Google) for L4 self-driving technologies, and that the two companies will partner on an electric taxi. (Volvo)

Electrification ^(history)

• Charger creator Trojan Energy raised £5 million in grants and new investment. (Charged EVs)

Other

• Cummins and NPROXX have formed a joint venture to make hydrogen tanks for truck trailers and rail carriages, anticipating a boom in demand for the gas. (Cummins)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

Making cars a little smarter; reading between the lines; and building cars for free.Please enjoy our auto industry and mobility briefing for 15^th June to 21^st June 2020. A PDF version can be found here.

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

• Running Up That Hill — Delphi and TomTom are experimenting with using map data to change a car’s engine settings in real time. Calibration engineers lovingly, and at great cost, already create an array of engine programs but they only cover discrete sets of conditions. Adding information about the journey makes engine mode changes based on prediction rather than reaction. Of course, the logic works for electric vehicles too and Delphi reckon all driving styles get a benefit. With fuel economy savings quoted at around 10%, and a renewed emphasis on the environment as emerge from our underground dwellings, it sounds like an easy win. Could solutions like be mandated in future, for the greater good?
• Don’t Let Me Get Me — FCA, GM and Ford declared that all their factories were back at work in the US after the coronavirus shutdown. But they used odd language. Instead of talking about reaching prior output levels, the press releases were stuffed with talk of pre-crisis operating patterns. But that just means when people turn up to work, doesn’t it, not how many vehicles they are actually building? Why declared victory if there is so much left to do?
• Sisters Are Doin’ It For Themselves — If you buy an electric version of the VW Golf, you can go to the factory and put it together. Well, not any of the important bits but you can stick the badge on the front. Here’s the best bit though: you’ll pay €215 for the privilege! Let’s have you put the wheels on too — must be worth €50 at least — and install the parcel shelf and trunk load floor (another €100?). As a rough rule of thumb, there is about €1,700 of labour cost in a family hatchback. The coronavirus crisis calls for out of the box thinking. Has VW worked out how many jobs the customer needs to pay to do themselves before the car costs nothing to build?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

BMW ^(history)

• Announced an agreement with German unions to encourage older staff to take voluntary redundancy and younger staff to retrain and do something different. Special pay-boosting entitlements for some workers (guaranteed extra hours) will be scaled back through a series of contractual changes. (BMW)
• In addition to permanent staff cuts, around 10,000 temporary production and contract engineering staff are also reportedly set to go. (Handelsblatt)
• Daimler and BMW decided not to deepen their partnership on next generation driver assistance systems after their experts jointly concluded that that had all done such a good job of developing systems before the partnership began that these amazing, yet totally different systems, would not benefit from being combined. (Daimler)
  • Significance: The decision seems odd in the context of an area where both firms are pouring hundreds of millions of research euros without clarity on customer reception, and therefore payback. The most logical explanation is that BMW and Daimler’s experts concluded L2+ / L3 systems have only limited commercial viability (because they will be so expensive that few users will take them) and so developing a more comprehensive technology set together was unlikely to payback.

Daimler ^(history)

• Created a framework for issuing green bonds, assuring investors that more than 50% of the money will be used for zero emission vehicles. (Daimler)
• Daimler and BMW decided not to deepen their partnership on next generation driver assistance systems after their experts jointly concluded that that had all done such a good job of developing systems before the partnership began that these amazing, yet totally different systems, would not benefit from being combined. (Daimler)

FCA ^(history)

• Plans for all US plants to be operating pre-coronavirus shift patterns from w/c 21^st June. (Detroit News)
  • Significance:  Ford, FCA and GM are all talking about “operating patterns” rather than production rate. It remains to be seen whether there is no real difference between the two, or if PR hungry executives are telling the media that things are back to normal just because the same number of human beings are making fewer vehicles.
• Recalling over 90,000 vehicles globally  to fix transmission problems. (FCA)

Ford ^(history)

• Rumours surfaced that the next generation Edge SUV is cancelled. Unions called for clarification. Ford’s vague answer aspired to continue in the segment, without committing to the Edge nameplate or the Canadian plant that currently produces it. (Detroit Free Press)
• Offered US office workers the chance to work from home full time until at least the end of 2020. (Detroit Free Press)
• Plans for all US plants to be operating pre-coronavirus shift patterns from w/c 21^st June. (Detroit News)
• Pushed back the unveiling of the new Bronco after it discovered the previous date coincided with the birthday of infamous Bronco owner O.J. Simpson, testing the limits of the any publicity is good publicity mantra. (Detroit News)
• Following the wave of “active” models seen across passenger car brands (where customers part with extra cash for plain plastic cladding and slight suspension changes), Ford has decided that the commercial vehicle market is ready for its own version. (Autocar)
• Will add hands-free (but not eyes-off) driving assistance on selected highways in North America. Ford plans to charge customers in two stages: there will be a “prep package” (the hardware) that customers need to specify at the time of purchase and then a second purchase for the software itself. (Ford)

Geely (includes Volvo) ^(history)

• Buying a stake of slightly mote than 15% in Chinese truck and bus maker Hualing Xingma. (Gasgoo)

General Motors ^(history)

• CEO Barra suggested that GM had made all the job cuts needed to survive a downturn. (Detroit Free Press)
• Announced US operations had returned to pre-coronavirus levels. Confusingly, only 90% of the hourly workforce are back at work. (Detroit News)
• Uses additive manufacturing (3D printing) to make up to 75% of the parts for early stage prototypes. (GM)

Hyundai / Kia ^(history)

• Despite difficulties brought on by coronavirus, Hyundai says 30,000 reservations have been made for the Indian market launch of the Creta. (Autocar)
• Launched a new app which contains car manuals. The clever bit is that, rather than having to look up tyre pressures in the index, drivers can simply point the smartphone camera at the area of interest and the app will identify relevant sections of the manual for them to read. Although this was possible before, the pain of setting it up meant Kia restricted the amount it was used. The firm now says it can roll out across carlines easily. (KIA)

Mazda

• Believes it will take a “long time” for pre-coronavirus crisis industry sales levels to return. (Mazda)
• Unveiled the new BT50 pickup truck, built using Isuzu underpinnings. (Mazda)

Nissan and Mitsubishi ^(history)

• Allies of Nissan’s COO are rumoured to be manoeuvring in an attempt to have him promoted to co-CEO. How such a change would promote stability at the company is anyone’s guess. (Reuters)

Renault ^(history)

• Stopped selling the value-engineered Captur crossover in India. High prices and cannibalisation from other models in Renault’s Indian range were blamed. (Autocar)
• Renault’s chairman denied that the company had any problem with the timing of EU emissions rules. (Reuters)
• Renault’s incoming CEO addressed shareholders (he hasn’t officially started work yet but the pay will presumably be sorted out later), saying he was looking forward to the challenge of turning the business around. Despite Renault’s recent restructuring announcements, he plans on revealing his own strategy at the end of the year. (Reuters)

Suzuki

• Urged Maruti-Suzuki suppliers to prepare contingency plans for a second wave of coronavirus (mainly by building more inventory) and apologised for the firm’s slow and inconsistent production since restarting in May. (Autocar)

Tata (includes JLR) ^(history)

• Reported financial results for the fiscal year ended 31^st March 2020. Wholes of 1.006 million units fell (23)% on a year over year basis, whilst revenue of 261,068 Cr INR (about $34.5 billion) dropped (14)% (of which JLR was £23 billion, about $28.7 billion). The before tax loss was (10,580) Cr INR (about $1.4 billion), but Tata Motors was declared “near breakeven” on an EBIT basis. JLR ‘s PBT was £(422) million (about $530 million). In response, both Tata Motors and JLR will go on a diet; in JLR’s case this is incremental to the already announced plan and will see a further £1.5 billion of cost actions and an axe being taken to (unspecified) parts of the product plan. JLR thinks that coronavirus cost the business £599 million and without it the brand would have made a full year profit. (Tata)
• The move to increase JLR’s cost savings target seems inevitable. Even excluding coronavirus the business was barely profitable, yet says cost actions have improved profit by £1 billion since 2018 (plus lower investment). (Tata) Part of the savings will come from further redundancies; (1,100) UK staff will go. (Reuters)
• Moody’s downgraded Tata Motors’s debt to B1 (deeper into junk territory). (Economic Times of India)

Tesla ^(history)

• Reportedly signed a lithium supply deal for up to 6,000 tones per year with Glencore. (Bloomberg)
• Firms that advise many shareholders recommended that they reject Tesla’s proposal to re-elect chairwoman Denholm, saying she was insufficiently independent from CEO Musk. (Reuters)
• Panasonic and Tesla expanded their long term supply agreements. (Reuters)
• A deal to buy a 2,100 acre site in Austin, USA suggests that Tesla may have made up its mind about the location of the factory for the Cybertruck. (Electrek)

Toyota ^(history)

• Will make its human body simulation tool (for crash and ergonomics) free for all users. Although it was previously openly available, there was a licence fee. (Toyota)
• Toyota and MIT are releasing a set of videos taken by cars developing self-driving technology, in the hope that it will spur development of object recognition. (Toyota)
• Invested in industrial engineering startup Drishti, which uses remote cameras and (ahem) artificial intelligence (definitely not human data labellers sitting in dark rooms) to conduct the sort of time and motion studies shopfloor workers often resent. (Toyota)
• Participated in a further fund raising round for AI company SLAMcore. (FINSMES)

VW Group ^(history)

• SEAT unveiled a refreshed Ateca mid-size SUV. (Autocar)
• Plans to scale down the Hannover, Germany, plant that builds commercial vehicles from around 15,000 employees to nearer 10,000. VW believes natural attrition will be sufficient. (Handelsblatt)
• Photographs sent to the Chinese government purported to show the production version of the ID4. (Autocar)
• Audi opened a new R&D centre in San Jose, USA, where staff will work on driver assistance systems. (TechCrunch)
• Agreed to invest an additional sum, up to $200 million, in solid state battery developer QuantumScape. VW previously put $100 million into the company. (VW)
• Inviting VW eGolf (the all-electric version) buyers to help build their car; they will be able to tell friends and family all about installing front and rear badges and the tail lights — and they will have paid €215 for the privilege. (VW)
• VW declared itself open to working with rivals on vehicle software. Although many executives might be interested in VW’s declarations of an open source approach, their technical teams may well be put off by VW’s intention to “define its core” themselves (see Daimler and BMW’s self-driving technology dissolution). (Reuters)
• Audi’s CEO took on a plethora of new roles: he will head the brand’s efforts in China and be responsible for engineering. To help, the brand has restructured the way product programs are delivered. The planning organisation will be separated from engineering. Audi announced a COO to help with the workload. There will also be a chief transition architect helping to manage the engineering side of things. (Audi)

Other

• Ssangyong has retained an agent to sell Mahindra’s stake to a partner with deeper pockets. (Reuters)
• BYD’s semiconductor unit raised $113 million — after recently taking in about $270 million. (Deal Street Asia)
• Electric vehicle developer Arrival unveiled a bus. Although no timing for launch was mentioned in the press release, there were some videos of prototype units driving on a test track. (Arrival)
• Aston Martin appointed a new CFO, who previously held the same position at JLR. (Reuters)
• McLaren is mulling a sale of part of the F1 team. (Sky News)

News about other companies and trends

Economic / Political News

• European passenger car sales in May of 1,444,173 units fell (57)% on a year-over-year basis. (ACEA)
• The UK government admitted that if talks haven’t made good progress by October, the chance of a UK-EU trade deal before the Brexit transition period expires are slim. (Reuters) The EU said it wanted a deal, but only if the UK was reasonable. (Reuters)

Dealers

• Chinese aftermarket parts marketplace CassTime raised $50 million. (Deal Street Asia)

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

• Multimodal app Splyt raised $19.5 million from investors including SoftBank. (SoftBank)
• Lyft said that by 2030, every car on its ride hailing platform will have zero tailpipe emissions. (Lyft)
• Hertz is no longer planning to issue new shares and instead hopes to raise a bankruptcy loan. (WSJ)

Driverless / Autonomy ^(history)

• The US government unveiled an initiative to collect testing data from companies developing self-driving vehicles. Critics said the data would be so thin as to be meaningless. (The Verge)
• Self-driving software firm AImotive raised $20 million, (VentureBeat)
• Toyota and MIT are releasing a set of videos taken by cars developing self-driving technology, in the hope that it will spur development of object recognition. (Toyota)
• Ford will add hands-free (but not eyes-off) driving assistance on selected highways in North America. Ford plans to charge customers in two stages: there will be a “prep package” (the hardware) that customers need to specify at the time of purchase and then a second purchase for the software itself. (Ford)
• Daimler and BMW decided not to deepen their partnership on next generation driver assistance systems after their experts jointly concluded that that had all done such a good job of developing systems before the partnership began that these amazing, yet totally different systems, would not benefit from being combined. (Daimler)

Electrification ^(history)

• Telecoms firm Telenor will offer Swedish customers charging bundled with their TV and broadband. (Charged EVs)
• Hyundai Mobis reckons it has cracked the problem that many electric cars have with the artificial sounds manufacturers fit them with to meet pedestrian safety laws: what sounds great in the studio is often distorted when played through a speaker mounted in the engine bay. Hyundai Mobis makes the front grille part of the speaker (a solution which is dependent to a degree on grille design), dramatically reducing distortion. (Hyundai Mobis)
• VW agreed to invest an additional sum, up to $200 million, in solid state battery developer QuantumScape. VW previously put $100 million into the company. (VW)

Connectivity

• Delphi and TomTom think that using mapping data to change a car’s engine settings in real time can improve fuel economy by 10%. Tests apparently showed that this was true across a range of driving styles. (Delphi)

Other

• Truckmaker Volvo Group plans to cut 4,100 staff jobs. (Volvo)
• Quantron plans to offer a fuel cell powered heavy truck in Europe from 2022 onwards. (Quantron)
• Bicycle rental firm Bird and Trailze launched a mapping service that plans optimum routes for bicycle and electric scooters. The company spies a gap in the market since current offerings are aimed at cars or pedestrians. (Bird)
• Electric motorcycle maker Alternet Systems (AYLI) raised $25 million. (AYLI)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

Tesla get outsmarted; data that isn’t all it’s cracked up to be; and VW’s managerial meltdown. Please enjoy our auto industry and mobility briefing for 8^th June to 14^th June 2020. A PDF version can be found here.

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

• Insane In The Brain – A Canadian garage says it has worked out how to overcome Tesla’s paid for upgrade programming. This is possible because Tesla sometimes installs the same standard of hardware, to reduce complexity, and then simply downrates the performance on entry level products. Tesla aren’t alone in this, traditional car manufacturers have done the same with engines for years – hence the thriving industry for replacing engine control chips. The problem for Tesla is that, if the claims are real, upgrades it tries to charge thousands for can be activated for free. Is modifying your car in this way the same (philosophically) as installing an aftermarket gear knob or are Tesla entitled to control the hardware?
• You Only Get What You Give – Daimler thinks that profits on services from in car transactions will rival those made from building the vehicles themselves. The only problem with that logic is that the revenues associated with hosting food and shopping smartphone apps are minuscule and, for instance, Apple don’t see a penny of Amazon’s gross sales. FCA’s deal with Otonomo to sell anonymised data (fairly inexpensively) is a more likely template for the way forward. How do carmakers keep convincing themselves that they have a way to make megabucks from in-vehicle data?
• Issues – All hell broke loose at VW Group, with CEO Diess being stripped of responsibility for the core brand and forced to apologise to the supervisory board. He had accused board members of leaking confidential information and (according to leakers) some of them were so incensed that they demanded his immediate resignation. With a wounded CEO, chances of reform at the firm appear to have dropped significantly. Can VW shake out of the self-inflicted stupor or does a period of treading water – at precisely the wrong time — lie ahead?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

BMW ^(history)

• BMW iVentures invested in Prometheus, a company developing ways to make fossil fuels via energy intensive chemical reactions, rather than sucking it out of the ground. (BMW)

Daimler ^(history)

• Daimler hopes to make as much money from offering in vehicle services as from selling the cars themselves. The main target appears to be taking a cut from in-vehicle transactions, such as buying food. (Autocar)
  • Significance: Since smartphone apps have already established norms in this area – developers paying $100 or less annually to have their app available, with zero cut of the revenue for high transaction sites such as Amazon. Why would purchases made inside the car be treated completely differently?

FCA ^(history)

• Recalling almost 28,000 vehicles because the 12 volt battery could catch fire. (FCA)
• EU antitrust regulators are taking a closer look at PSA and FCA’s proposed merger, with dominance in commercial vehicles flagged as a concern. (Reuters)

Ford ^(history)

• Ford’s CEO and COO reiterated that there were big headcount reductions to come in South America and Europe saying that as a result of the pandemic “everything’s on the table”. (Ford)
• Gave a detailed presentation focused on explaining Ford Credit to investors. (Ford)
• In the announcement confirming the VW and Ford joint vehicle programs, Ford indicated that it will build the electric vehicle engineered from VW’s MEB platform, rather than sourcing to VW. The two companies believe that the shared 1T van, pickup truck and small van will yield 8 million units over their lifetimes. (Ford)
• Recalling 2.15 million US vehicles for faulty door latches that may have been incorrectly repaired. (Reuters)

Geely (includes Volvo) ^(history)

• Geely’s Xiaolinggou unit, which rents out electrified vehicles, raised $97 million. (Deal Street Asia)

General Motors ^(history)

• CEO Barra says coronavirus has helped GM make decisions more quickly than before (perhaps because line managers can’t interfere as much). (Detroit Free Press)

Honda ^(history)

• Honda was hit by a cyber attack that compromised IT systems and affected some non-Japanese plants. (BBC)
• Created a joint venture in China called Hynex to offer connected car services. (Honda)
• There was an explosion at a Honda plant in Japan. (Reuters)

Hyundai / Kia ^(history)

• Kia’s European boss says that coronavirus lockdown measures have made it easier for the brand to meet its EU CO₂ targets. (Autocar)
• Believes that fuel cells will be commercially viable by 2025 and disagrees with Daimler’s strategy to direct fuel cells only at heavy trucks (although Hyundai sees potential in that area) because the company thinks that only passenger cars have sufficient scale to lower costs for all users. Although the ultimate target is cost parity with battery electric systems, Hyundai reckons that demand will blossom because of stricter environmental regulations. (Bloomberg)
• Invested in hydrogen infrastructure company Hydrogenius LOHC Technologies. (H2 View)
• Suspended production of the diesel Genesis GV80 SUV because of engine vibrations that arise when the cars spend too long idling. (Yonhap) Parts supply problems then stopped production of the model completely. (Yonhap)

Nissan and Mitsubishi ^(history)

• Nissan’s CEO says the brand never considered leaving Europe as part of its restructuring and that changing the cross shareholding structure between Nissan and Renault was a low priority at the moment. (Les Echos)
• Mitsubishi is part of a consortium of 30 Japanese companies working on a “virtual power plant” (grid management by feeding in stored electricity). (Mitsubishi)
• Nissan sources suggested there was a trail of correspondence detailing a 12 month exercise leading up to former chairman Carlos Ghosn’s ouster and arrest for mis-reporting compensation and other indiscretions. (Bloomberg)

PSA ^(history)

• Won’t open the Ellesmere Port factory in the UK (which produces the Astra) until at least 1^st September, but hopes to relocate some workers to the Luton, UK, factory to help build more vans. (Liverpool Echo) The company is planning something similar in France, with 500 Polish workers told to hotfoot it over to the Hordain plant and help out on the production line. (France Info)
• Citroën thinks that, ideally, car brands should offer between five and ten different vehicles. At the lower end, the brand thinks there are too many portfolio gaps to be considered a mass-market brand, whilst with too many, complexity and investment start to hurt efficiency. The official stance is that the brand is open-minded about replacing the C1 but executive comments suggest the space will be left to the all-electric Ami. (Autocar)
• Attempts by Opel’s HR team to broach the subject of pension changes in Germany were slapped down by unions. It is unlikely that managers will be deterred for long as they already suggest survival is at stake. (Handelsblatt)
• A PSA executive suggested that brands within the group were allowed to chart their own destiny in terms of emissions compliance closure — suggesting the some next generation cars might offer an all-electric version, whilst some may build no more than a hybrid. (Autocar)        
  • Significance: Given PSA’s much-vaunted commonality strategy, and the work involved in engineering three different powertrain technologies into a vehicle platform, it seems unlikely that the brands have true independence, and more that this is a way of balancing the product engineering dilemma around electric vehicles by only going all-in on one design but having others on a shortcut route to launch if needed.
• EU antitrust regulators are taking a closer look at PSA and FCA’s proposed merger, with dominance in commercial vehicles flagged as a concern. (Reuters)

Renault ^(history)

• Renault’s chairman said he isn’t interested in the French state increasing its shareholding in the firm. (Reuters)

Tata (includes JLR) ^(history)

• JLR is looking to make every step of the sales process contactless and sees opportunity to use online services to reduce some of the time, even if the whole purchase experience doesn’t become virtual (for instance, signing finance paperwork over the internet rather than wading through reams of paper at the dealership. (Autocar)
• Tata is buying out its joint venture partner in the JTSV division that creates souped-up versions of Tata’s Indian passenger cars. (Tata)

Tesla ^(history)

• A rocketing share price saw Tesla’s value exceed Toyota’s (and everyone else). The jump followed a “leaked” email (which CEO Musk almost immediately confirmed as genuine) saying the Semi truck was about to go into full production. The share value has since receded slightly. (Reuters)
• Internal emails showed CEO Musk fretting about quality and output on the Model Y however he was keen to stress that he thinks such problems always occur with new product. (Business Insider)
  • Significance: With the Model Y in its sixth month of launch, there isn’t much time left before it becomes difficult to explain launch issues away as normal business.
• A Canadian garage says it has hacked Tesla’s upgradable hardware (where Tesla installs more capable batteries or motors as standard but downrates performance for cheaper models unless the owner pays extra). It is now offering to unlock the same capabilities for reduced prices. (Electrek)
  • Significance: It remains to be seen if Tesla subsequently undoes the upgrades. If not, it undermines the company’s upgrade strategy. If it does, it raises questions about the company’s right to block modifications made by owners.

VW Group ^(history)

• Forced CEO Diess to give a public apology to the supervisory board after he insinuated in meetings with senior managers that board members had leaked sensitive information. (VW) Board members, or those close to them, reacted by leaking the story of the fiery board meeting leading to the apology where several of them called for Diess’s immediate sacking. To show Diess whose boss, they stripped him of the CEO position for the core VW cars brand (he remains group CEO), handing the reigns to the brand’s COO. (Handelsblatt)
  • Significance: Diess appears to be on borrowed time, with the main arguments for keeping him in role apparently being the difficulty economic environment and the extra turbulence that would be caused on top of the troublesome Golf and ID3 launches. It looks as though in just two years, the hard-charging Diess has got from a man with a mission to transform the business to a dead man walking.
• Announced that it had concluded an investigation into a racist social media advert, and that whilst VW agrees it is racist, says it wasn’t on purpose. In future, the brand will review new videos more thoroughly before launch. (VW)
• VW’s procurement chief, the former CEO of ZF, left the company at short notice. (VW)
• In the announcement confirming the VW and Ford joint vehicle programs, Ford indicated that it will build the electric vehicle engineered from VW’s MEB platform, rather than sourcing to VW. The two companies believe that the shared 1T van, pickup truck and small van will yield 8 million units over their lifetimes. (Ford)

Other

• Mahindra & Mahindra is prepared to sell its stake in Ssangyong, if it can find a buyer. (Autocar)
• Nio raised $430 million via a rights issue. The money will go towards funding Nio’s shares of the costs associated with its recent deal to set up Nio China and relocate its headquarters. (Motley Fool)
• Evergrande bought the remaining shares in NEVS. Whatever you make of the deal, you have to give credit to whoever in Evergrande decided to call their purchase vehicle “Mini Minor”. (Caixin)
• Nikola’s CEO said the company is in talks with three potential partners about contract manufacturing its forthcoming Badger pickup. (Reuters)
• Australian start-up H2X plans to launch a fuel cell powered SUV called Snowy in 2022. (The Driven)

News about other companies and trends

Economic / Political News

• Spain launched a scrappage incentive scheme. (Reuters)

Suppliers

• Faurecia says it has been arranging for banks to give financing to its suppliers so that they can restructure and continue in business.  The company believes it will take until 2023 for industry to reach pre-crisis levels. Although Faurecia expects some consolidation, it isn’t making M&A a priority but pointed to some acquisitions it had made during the credit crunch at the behest of carmakers. (Market Screener)
• A restoration company, Craft Customs, says that all our leather steering wheels are going to suffer from being lathered in hand sanitiser. Good job we aren’t driving much then. (Craft Customs)
• Continental’s CEO reportedly told staff there was a high probability that the firm would have to resort to involuntary redundancies to save money. (Automotive News)
• Aptiv raised up to $2.2 billion via a share issue. (Aptiv)

Dealers

• Chinese online automotive sales platform Bitauto agreed terms for a Tencent-led takeover. (Bitauto)
• Spare parts wholesaler Mancando raised $57 million. (Deal Street Asia)
• Used car website Vroom’s IPO went great guns, almost doubling on their opening day. (Reuters)

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

• Californian authorities now consider ride hailing drivers as employees, much to Uber’s and Lyft’s dismay. (Reuters)
• Uber’s plan to buy Grubhub were scuppered by an alternative bid from Just Eat. (Reuters)
• Despite entering bankruptcy protection, Hertz might issue $1 billion of fresh shares. (Reuters)

Electrification ^(history)

• BYD is reportedly considering building a UK battery factory to supply JLR, amongst others. (China Daily)

Connectivity

• Upstream Security, which already counts Renault, Nissan, Mitsubishi and the Volvo Group amongst its backers, raised an additional $30 million. (Upstream)
• Connected vehicle data company Viaduct raised $11 million. (Viaduct)
• Otonomo will start selling vehicle data sourced from FCA. In addition to providing the information to third parties (for a fee), Otonomo takes on the role of anonymising the information to soothe any data privacy concerns the issuing OEM might have. (Otonomo)
• Navmatic, a developer of precision navigation equipment, raised $4 million in a round led by Lear. (Benzinga)

Other

• Air taxi firm Lilium raised another $35 million. (TechCrunch)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

Self-driving cars that could crash too much; dealers that want more money; and Dyson’s late analysis. Please enjoy our auto industry and mobility briefing for 1^st June to 7^th June 2020. A PDF version can be found here.

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

• Never Too Much — A study by a US insurance think tank reckons that self-driving cars won’t save as many lives as many had hoped. They challenge the oft-repeated mantra that 90% of accidents could be avoided because they say that unforced errors are only responsible for 30% of crashes. There is a caveat though: in most other crashes, human error is still to blame via speeding and illegal manoeuvres. They conclude that autonomous vehicle developers need to make their products drive conservatively than people do — but doesn’t everyone already know that?
• Gimme Some More — Indian dealers reckon that margins are too thin and OEMs should top them up to around 7%. If they don’t, the dealer association fears many outfits will go out of business. But, with the much-predicted demise of the traditional dealer (even before coronavirus), is that so much of a worry?
• Too Little, Too Late — Dyson revealed yet more details about the company’s abandoned electric car. The videos and blog glory in the no-compromises design details the team found when planning their massively expensive SUV. The project’s demise was blamed on dieselgate “suddenly” transforming the competitive marketplace and shrinking the sales potential. But, since the project was abandoned in late 2019 and dieselgate happened in late 2015 (and isn’t responsible for the surge in electric vehicles anyway), why did it take so long to realise the car would lose money?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

BMW ^(history)

• Unveiled the new 4 Series. (BMW)

FCA ^(history)

• Running a series of tests with hybrid electric vehicles that only operate in electric mode within city limits. BMW has long ago committed to operating such a mode. (FCA)
• Robot making arm Comau will be spun off after PSA and FCA merge. (Reuters)

Geely (includes Volvo) ^(history)

• Kandi Technologies reported Q1 2020 revenue of $6.4 million, down (65)% and a net loss of $(1.6) million. (Kandi)

General Motors ^(history)

• Will run many US plants during the traditional early July shutdown period to recover lost production. (Detroit News)
• CEO Barra says GM will emerge from coronavirus with a permanently lower cost base. (Reuters)
• GM’s Cruise self-driving unit wrote to employees of rival Zoox offering them new jobs and expressing the view that if Amazon’s much-rumoured takeover of Zoox goes ahead, their bonuses will be reduced. (Reuters)

Nissan and Mitsubishi ^(history)

• A Nissan representative in Lebanon got himself in hot water after he said in an interview that IMF aid for Lebanon’s economy was conditional upon Carlos Ghosn’s extradition to Japan. After denying the comments, he suffered the indignity of having journalists publish an audio recording. (Arab News)
• Recalling 1.9 million cars to fix problems with the hood latch. (Detroit News)

PSA ^(history)

• Relations between managers and German labour representatives at Opel appear to have hit a rough patch with unions complaining that the announcement about the closure of the transmission plant and forge in Russelsheim was presented to the workforce as though they had agreed to it. (FAZ)
• Announced a joint venture with Punch Powertrain to develop and manufacture dual clutch transmissions. Punch will contribute facilities and PSA will put up some cash. PSA said it was part of a plan for powertrain to remain vertically integrated. (PSA)

Renault ^(history)

• The French government finally put pen to paper on Renault’s €5 billion credit guarantee. (Renault)

Tata (includes JLR) ^(history)

• JLR agreed a new £560 million credit line. (The Guardian)

Tesla ^(history)

• Developing a 12-seat minibus for use in tunnels dug by CEO Musk’s pet project The Boring Company, according to  officials are considering commissioning a tunnel for their local airport. (OCR)

Toyota ^(history)

• Toyota reportedly expects to exceed prior year production volumes (on a monthly basis) in North America by September. (Reuters)
• Toyota formed a joint venture with several Chinese OEMs including FAW, Dongfeng, BAIC and GAC) to promote fuel cells for commercial vehicles. (Toyota)

VW Group ^(history)

• CEO Diess reportedly told senior managers that the company was about to undertake a cost cutting drive, but did not provide much specific information, beyond an intent to reduce non-production material costs by 20%. He also apparently confirmed that not all brands will be profitable in 2020 — something that could already be inferred from the group’s financial guidance. (Manager Magazin)
• Lifted a production freeze on the next generation Golf after solving a software problem affecting the emergency calling function. About 30,000 cars will be recalled to fix the error. (Handelsblatt)
• Lamborghini’s CEO seems comfortable that sales are recovering, despite job cuts at competitors McLaren and Aston Martin and sister company Bentley. (Yahoo)
• Bentley finally said goodbye to the V8. (Bentley) It will soon be doing the same to around 1,000 employees — about 25% of the workforce at the brand’s Crewe headquarters. The Bentley battery electric vehicle will be delayed by a year, to 2026. (ITV)

Other

• Aston Martin is laying off up to 500 people in a move that will cost £12 million. The firm expects to save £18 million per year through the move, plus other spending reductions. (AML) InvestIndustrial, one of the main shareholders when the firm went public, cut its share in Aston Martin to 5%. (Reuters)
• Mahindra Electric believes that the Indian market for electric vehicles will take off in 2023. (Autocar)
• Fuel cell powered truck maker Nikola had its stock market debut. (Forbes) The company’s recent purchase of hydrogen production equipment suggests each filling station will cost more than $6 million. (Nikola)
• Dyson published more details (including a video) about its abandoned electric car effort. Curiously, the company appears to blame VW’s dieselgate scandal for causing traditional OEMs to pile into the electric vehicle market, and “suddenly” diluting the market share the firm had hoped to achieve. (Dyson)
  • Significance: Since dieselgate started in 2015, and (in any case) the increase in electric vehicles has far more to do with the success of Tesla and regulations in the EU and China, it isn’t clear why Dyson didn’t realise the scale of competition until 2019 — a lack of competitive analysis perhaps?

News about other companies and trends

Economic / Political News

• US light vehicle industry of 12.21 million units fell (30)% versus prior year. (Wards)
• German passenger car registrations in May of 168,148 units dropped (50)% versus prior year. (KBA)
• France had 96,310 passenger car registrations in May, down (50%) on a year-over-year basis. (CCFA)
• Spanish registrations of 34,337 passenger cars in May were (73)% worse than prior year. (ANFAC)
• May Italian registrations of 99,711 passenger cars were (50)% down on prior year. (UNRAE)
• UK registrations of 20,247 new passenger cars in May fell (89)% on a year-over-year basis. (SMMT)
• Germany launched an automotive stimulus package consisting of across the board sales tax cuts (3%) and increased incentives for electric vehicles (an extra €3,000 off the list price). There is also money set aside to fund research into new technologies and to provide charging infrastructure — including charging points at all filling stations. (FAZ)

Suppliers

• The boss of Endurance Technologies is on the hunt for acquisitions. (Autocar)
• Meritor aims to sack about 8% of the salaried workforce. (Meritor)
• Wheel maker Borbet terminated its collective bargaining agreements in Germany, saying the coronavirus put the company in dire straits. Unions said they would fight it. (IG Metall)

Dealers

• UK dealer Vertu Motors said initial sales were promising and that, despite plans by rivals to downsize (Lookers is shedding 1,500 jobs), the company thinks scale is the way forward.  (Reuters)
• The body representing Indian dealers claims its members are given too little profit by the OEMs (the article contains a detailed table), and that margin levels need to double to make their businesses viable (presumably coming at the expense of OEM profits, rather than transaction prices). (Autocar)
• Indian online car sales portal CarTrade is reportedly raising $43 million. (Deal Street Asia)
• Online used car seller Vroom is hoping for a valuation of $2.3 billion when it completes its IPO. (Reuters)

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

• Singaporean short term car rental service Smove shut up shop. (Deal Street Asia)
• Didi Chuxing’s boss said taxi journeys in China during May were at the same level as the prior year. Ride hailing firms normally like to tout double digit quarter-over-quarter growth rates. (Deal Street Asia)

Driverless / Autonomy ^(history)

• A study by a US insurance think tank concluded that fully autonomous cars would only reduce accidents by around 30%, rather than the 90% improvement many advocates have touted. However, the headline assumed that such vehicles will not drive more conservatively than humans today, with a further 40% of accidents attributed to speeding or illegal manoeuvres; conditions that self-driving vehicles are explicitly being trained to ignore (in addition to the compounding benefits of having more cars on the road driving within sensible limits). (IIHS)

Electrification ^(history)

• Mahindra Electric believes that the Indian market for electric vehicles will take off in 2023. (Autocar)
• Nikola’s recent purchase of hydrogen production equipment suggests each filling station will cost more than $6 million. (Nikola)

Connectivity

• Mitsubishi Corporation and NTT now own 30% of mapping company HERE, joining existing shareholders Audi, Bosch, Continental, BMW, Pioneer, Intel and Mercedes-Benz.  (HERE)

Other

• Electric scooter firm Superpedestrian raised $15 million and acquired bicycle rental service Zagster. (PE Wire)
• Aviation firm Kitty Hawk canned its flying car project, preferring to concentrate on larger vehicles. (Kitty Hawk)
• Autonomous robot firm Otto Motors (a unit of Clearpath Robotics) raised $29 million. (Otto Motors)
• Brazilian bicycle rental firm Tembici raised $47 million. (Reuters)
• Autonomous robot developer Locus Robotics raised over $40 million. (Locus)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

Simulations that are too perfect; style need not cost the earth; and Nissan’s promise to do better.Please enjoy our auto industry and mobility briefing for 26^th May to 31^st May 2020. A PDF version can be found here.

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

• Paranoid Android — GM’s Cruise self-driving division says that it has been doing fine during quarantine, thanks to the powerful simulations used to develop artificial intelligence. But, when you read the fine print, there is plenty that they have not got right (yet). The to-do list includes simulating the interference that makes lidar and radar signals far fuzzier than the lovely videos we are used to watching. If you can’t properly model the partial images a car gets in reality, why do people portray simulation as a serious alternative to testing? And if GM can’t get it right yet, should you believe anyone else has?
• Fashion — VW unveiled the budget focused Nivus crossover. I don’t know the car is everyone’s cup of tea but most would probably agree that it is better looking than the supposedly more upmarket T-Roc. This choice, that value does not have to mean sacrificing style, follows the blueprint set by Renault with the Kaptur (which looks like a Captur, but uses cheaper bits). Do purveyors of slab-sided, yawn inducing value cars need to hurry back to the drawing board?
• Simple Things — Nissan set out its recovery plan. It follows a simple formula: cut capacity; reduce product spending; grow share; make money. But is it really that simple? Many car companies have promised to do more with less, only to end up with… less with less. Fortunately, much of the time, industry volume grows so that underperforming share is offset. Will Nissan be so fortunate, or will we see another plan in 2022?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

BMW ^(history)

• In talks with German unions to put together a package that, BMW hopes, will help trim the headcount by 5,000 people. (Bloomberg)
• Unveiled a facelift for the BMW 5 Series and 6 Series GT, plus the Mini Countryman.

Daimler ^(history)

• Hot on the heels of the recently agreed fuel cell partnership between Daimler Trucks and Volvo trucks, Daimler signed a similar agreement with Rolls-Royce (the aero engine maker) for generator type systems. This is a new JV, although the Daimler-Volvo unit will be involved because it will produce the fuel cells. (Daimler)

FCA ^(history)

• Breathed a sigh of relief as Moody’s left FCA’s rating unchanged. (FCA)

Ford ^(history)

• Executives cryptically suggested that Ford and Rivian were working on a joint program. (Green Car Reports)

Geely (includes Volvo) ^(history)

• Geely raised about $840 million through a rights issue, selling about 6.1% of the firm (after enlargement). (Geely)

General Motors ^(history)

• Said that production restart had gone smoothly and production was now being increased by bringing in extra shifts. Despite the upbeat tone, even at the higher level, production will be below pre-coronavirus levels. (GM)
• GM’s Cruise self-driving unit outlined the difficulty with simulating sensors so that AI can learn to drive in a virtual environment. The team’s to do list suggest that whilst modelling real world interference is something they are concerned about, it isn’t yet solved. (GM)

Nissan and Mitsubishi ^(history)

• Nissan reported 2019/20 fiscal year revenue of 9.9 trillion JPY (about $92 billion), down (15)% versus prior year. A net loss of (671) billion JPY (about $(6) billion) compared to a profit of 319 billion JPY in 2018/19. Nissan’s consolidated wholesales of 3.35 million units fell (16)% on a year-over-year basis, a weaker performance than overall retail sales of 4.9 million which fell (11)%. Nissan impaired assets by 522 billion JPY (about $5 billion). The firm hopes that global industry will only decrease (15)% – (20)% in the next financial year. (Nissan)
• Nissan unveiled its recovery plan, much of which had leaked in the weeks leading up to the announcement. Global capacity will be cut to 6 million units by 2023, and the straight time capacity will be 5.4 million — closer to Nissan’s real sales rate than the circa 7 million units of capacity in place today. Nissan expects that plant utilisation will be at least 80%. Cuts will be across the board, with only two plants scheduled to shut — Indonesia (already announced) and Barcelona, Spain. The brand will cull poor-performing products, with the value Datsun brand and smaller cars declared non-core. (Nissan)
  • Significance: Nissan’s plan contains two colossal assumptions: firstly, that industry will recover in time to support the brand’s volume ambitions; secondly, that despite reducing the portfolio, the market share will either grow or hold steady (depending on the market).
• The Renault-Nissan-Mitsubishi announced a (previously advertised) plan to simplify product engineering and reduce costs. The main elements are that the different brands will share much of the bodywork, not simply the underpinning components, and are likely to be made in the same factories. A secret formula will be used to decide which company has the lion’s share of work for each product. There is a structure for technologies too. The partners believe that they could save 40% of the investment costs for a new model. (Mitsubishi)
  • Significance: Whilst the claimed savings are substantial, and the template for this engineering relationship already exists at PSA (albeit with all brands owned by the same company), there is something of a disconnect. The 40% figure is in line with PSA’s supposed savings by integrating Opel with the Peugeot and Citroën brands, but Renault and Nissan already claim lots of this through their fabled alliance synergies.
• Settled a case Nissan brought against an Indian regional government for failing to pay the level of incentives agreed when Nissan set up a plant there. Indications were that Nissan received $185 million – $240 million, around one third of the amount claimed. (Reuters)

PSA ^(history)

• Apparently poised to confirm that Opel’s Russelsheim plant will soon be allocated a new vehicle. It isn’t all good news though: the site can reportedly expect redundancies in the powertrain manufacturing area and some insiders believe the product will simply offset the seemingly never-ending decline in Insignia volumes. (Handelsblatt)

Renault ^(history)

• Renault unveiled a new plant aimed at saving €2 billion over the next three years, cutting about 15,000 employees of which 4,600 heads will be lost in France. On the production side, capacity will be cut by about (20)%; planned capacity increases won’t go ahead; gearbox manufacturing will probably be hit and several French plants face periods of consultation and “reflection”. Taking a leaf out of PSA’s book, Renault seems minded to gut factories without shutting the gates, rather than closing the whole thing (although a couple of smaller plants are likely to go). By 2026, all Renault vehicles are planned to be on platforms with greater than 600,000 units per year.
• The French government said the state backed mega loan for Renault will not be signed off until the company satisfies labour unions that job cuts are needed — and takes a dim view of factory closures. (Reuters)
• Renault expects battery costs to fall below $100 / kWh, thanks to sharing Nissan and Mitsubishi. (Pres p.25)

Tesla ^(history)

• CEO Musk hit the first of a series of stock option milestones, netting him a cool $800 million — if he decides to cash in immediately. (The Verge)

VW Group ^(history)

• Sources suggest that CEO Diess is on thin ice with his board and fighting off criticism from employee representatives and state shareholders may distract from a post-coronavirus recovery. (FAZ)
• Audi is betting on a in-house effort named Artemis to accelerate the brand’s efforts to bring technologically sophisticated electric vehicles to market, seeking a “highly efficient” electric car by 2024, and a network of services to offer alongside the vehicle. (Audi) Supposedly the aim is to out-Tesla Tesla, after internal VW group reviews have concluded that current electric products are competitive but missing that certain something. (Manager Magazin)
• Announced that it had given board approval to three (previously announced) joint vehicle programs with Ford, the milestone indicates that the vehicles in question are commencing their (capital intensive) industrialisation. (VW)
• Scania is cutting 5,000 jobs, with about 1,000 of these coming at head office. (Scania)
• Launched a (previously announced) joint venture with consultancy CapGemini, called XL2, that will provide software engineering expertise for Audi. (Audi)
• Audi launched a new initiative, starting in France, that allows buyers to make an online reservation for any new or used vehicle in dealer stock for €100. (Audi)
• Confirming earlier rumours, VW took a 26% stake in battery maker Guoxuan (Gotion) for €1.1 billion. At the same time, VW announced a deal to buy a 50% share in carmaker JAC and increase VW’s control of the existing JV with JAC for electric vehicles to 75% (from 50%). The JAC investment is about €1 billion. (VW)
• VW unveiled the Nivus, a small crossover aimed at value conscious buyers, mainly in Latin America. (Autocar)
  • Significance: As with Renault’s emerging market Kaptur, VW has decided that a low cost proposition shouldn’t mean compromising on styling. Brands planning on selling boring, or tired, vehicle designs may need to change course (and some non-value vehicle programs may be getting nervous too).

Other

• Rivian appears to be planning a foray into vehicle insurance, according to job postings. (TechCrunch)
• BYD’s semiconductor business raised $265 million ahead of a separate listing. (Deal Street Asia)

News about other companies and trends

Economic / Political News

• France unveiled an €8 billion stimulus scheme for the automotive industry. It involves increased incentives to switch to electric vehicles and lowers the qualification criteria for an existing scheme that supported the scrappage of older, higher polluting, vehicles. President Emmanuel Macron wants his country to be the leading producer of electric cars — hoping for one million per year to be built by 2025. Someone familiar with VW’s plans, and Tesla’s designs for a German factory, should probably tell him that he might not be setting his sights high enough. (BBC)
• European manufacturers body ACEA suggested that the EU might want to stop issuing new emissions rules (which govern pollution levels), because rules forcing lower CO₂ / better fuel economy would improve fleet emissions as a by-product. (ACEA)

Suppliers

• Autoliv reckons that production has recovered well in China, but that Europe is far less healthy with the firm calling the restart “low and unstable”. It has already laid of 15% of global production staff. (Autoliv)
• ZF has completed the acquisition of WABCO. (ZF) The champagne will probably remain on ice however, because the company is reportedly planning to cut 15,000 jobs worldwide. (Reuters)
• Continental and Pioneer have teamed up to offer infotainment tailored to Asian markets. (Continental)

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

• Ride hailing firm Ola acquired electric scooter firm Etergo, seemingly to boost corporate knowledge and technology ahead of launching a range of electric two wheelers in 2021. (Reuters)
• Uber says that if it had to classify drivers in California as employees, it would probably sack about 75% of them because so few currently work a 40-hour week. (Uber)
• Uber was accused of being tin-eared to the woes of bicycle lovers everywhere after tens of thousands of bikes owned by Uber’s Jump bicycle rental brand were scrapped because new owner Lime regarded them as technically inferior and surplus to requirements. Uber said “recycling” the bikes was easier than giving them away. (The Verge)
• Mobile home rental firm Cabana raised $3.5 million, with some of the money coming from the (independently wealthy) head of Ford’s software arm. (FINSMES)
• BlaBlaCar will integrate electric scooter rental service Voi on its platform. (TechCrunch)
• Advantage Rent A Car filed for Chapter 11 bankruptcy. (Auto Rental International)

Driverless / Autonomy ^(history)

• Didi Chuxing raised over $500 million to spend on developing self-driving cars. (Reuters)
• Self-driving car developer Zoox will reportedly be sold to Amazon, with the two parties said to be in detailed talks. The firm is notable because it has set out to create its own vehicle, in addition to the self-driving hardware and software and would possible form a useful alternative to the larger vehicles Amazon plans to buy from Rivian. (WSJ)
• GM’s Cruise self-driving unit outlined the difficulty with simulating sensors so that AI can learn to drive in a virtual environment. The team’s to do list suggest that whilst modelling real world interference is something they are concerned about, it isn’t yet solved. (GM)

Electrification ^(history)

• Battery supplier CATL plans to develop battery swapping services. (Reuters)
• Air Liquide hopes that a new type of filling station, which can pump hydrogen more quickly, will encourage take-up of fuel cell cars. (Green Car Reports)
• Nio says that it has undertaken 500,000 battery swaps since launch. Take-up varies; less than half of cars sold have ever visited such a facility. (Inside EVs)
• Renault expects battery costs to fall below $100 / kWh, thanks to sharing Nissan and Mitsubishi. (Pres p.25)

Other

• Singaporean electric scooter rental firm Beam raised $26 million. (TechCrunch)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.

Broadband providers charging cars; a slightly random battery milestone; and a cheap and cheerful way to delight buyers. Please enjoy our auto industry and mobility briefing for 18^th May to 25^th May 2020. A PDF version can be found here.

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

• Pack The Pipe — Media company Liberty Global is launching a charging network in the UK based around supplying electricity from its broadband telecoms infrastructure. Way back (!) in 2017, Deutsche Telekom tested the water with something similar. Across the world, companies with pipes or cables in the ground are realising that they might be just as well-placed as traditional utilities to supply charging points. When will utilities start taking this threat seriously?
• A Million Dreams — GM says it is on the cusp of a battery that lasts a million miles, following similar claims by Tesla. Everyone got very excited, but I’m still trying to figure out what this really means. If it means that the battery stays at automotive standard for one million miles (i.e. it can hold an extremely high state of charge compared to original capacity over that time), doesn’t that make it over-engineered when cars typically last well below 500,000 miles?
• Girls On Film — Porsche has put up some cameras in its factory to take pictures of the cars as they pass along on the conveyor (a bit like the log flume at a theme park) in various stages of build. The shots are then forwarded on to the expectant owners-to-be, making them feel embedded in the process. Total set-up cost? Probably about £500. Seems like a cheap way to build brand loyalty. Why isn’t everyone doing this?

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

Find our archive here.

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

News about the major automakers

Daimler ^(history)

• Mercedes’s design chief says the all-electric EQS will look radically different to the forthcoming next-generation S-Class with which it shares many of its parts. He says that the brand’s production intent concept cars (such as the EQS) always herald 80% to 90% of the road-going design. (Autocar)
• Mercedes does not believe that synthetic fuels are viable in the medium term and, if it does become a reality, the fuel will become widespread in aviation before it reaches the mass market for vehicles. (Autocar)
• A cybersecurity researcher said he had downloaded the source code used for the Mercedes Van connectivity suite. In a classis blunder, Daimler’s software team were using an online tool to store and check code and although people needed to register to access the code, access was automatically granted without checks. (ZDNet)
• Reportedly plans to invest in battery developer Farasis Energy’s impeding IPO. (Reuters)
• Geely wants to explore deeper collaborations with Daimler. (Reuters)

FCA ^(history)

• FCA’s chairman brushed off suggestions that the intended special dividend payment to shareholders might be at risk, given the large sum the company hopes to borrow from the Italian taxpayer. (Reuters) Government ministers said FCA would need to invest more in Italy to fully justify the money. (Reuters)

Ferrari

• Raised €650 million in debt at an interest rate that will make Ferrari the envy of automotive treasurers. (Ferrari)

Geely (includes Volvo) ^(history)

• Geely has commissioned a new design centre in Sweden dubbed the “chamber of secrets” by its architects. New cars can be viewed in natural light via a rooftop courtyard, safe from prying eyes boast the designers, unless would-be spies are equipped with low-cost drones. (Deezen)
• Volvo raised around $1.3 billion in new credit lines, net of extensions. (Volvo)
• Volvo has now implemented the unilateral 180 km/h speed restriction for all cars in production. (Volvo)
• Geely wants to explore deeper collaborations with Daimler. (Reuters)

General Motors ^(history)

• GM says that its engineers stand on the cusp of a million-mile battery. (Reuters)

Honda ^(history)

• Honda’s Chinese vehicles will use an infotainment and connectivity suite developed with Tencent. (Nikkei)

Nissan and Mitsubishi ^(history)

• Mitsubishi reported financial results for the fiscal year ended March 2020. Net sales of 2.27 trillion JPY (about $21 billion), down (9.7)% on a year-over-year basis. Operating Income of 13 billion JPY (about $120 million), down (89)% versus prior year. (Mitsubishi)
• American officials arrested two men in connection with Carlos Ghosn’s flight from Japan (which is seeking their extradition). It isn’t clear whether the move will affect Ghosn himself. (Economic Times of India)
• Unveiled the production version of the limited-edition GT-R 50, produced with ItalDesign. (ItalDesign)
• Further rumours of Nissan’s turnaround plan emerged; 20,000 jobs will apparently be lost. (Reuters)
• Spanish authorities reckon it would cost Nissan €1 billion to close the Barcelona factory. (Reuters)

Renault ^(history)

• France’s finance minister worried that Renault might “disappear” without state help. He desperately wants for the firm to improve productivity, provided it doesn’t affect French jobs. (Reuters)
• Rumours swirled that Renault’s restructuring plan will see the closure of three small plants and that the recently unveiled Mégane won’t be replaced. The future of the Flins plant supposedly hangs in the balance. (Autocar)

Tata (includes JLR) ^(history)

• Jaguar’s one-make electric I-Pace racing series (which supports Formula E) will stop at the end of 2020, one year earlier than planned. (The Verge)
• Reportedly hoping to receive a loan of around £1 billion from the UK government. (Sky News)

Tesla ^(history)

• Expects that the Shanghai factory will reach output of 4,000 vehicles per week by the end of June, implying an installed capacity of around 185,000 units — higher than the 150,000 announce by Tesla. (Xinhua)
• Panasonic said it was in talks with Tesla to expand capacity at the Nevada Gigafactory. (Reuters)

Toyota ^(history)

• Recalling 9,500 RAV4 SUVs in the USA because the suspension arms might break. (Toyota)
• Unveiled the all-new Sienna minivan (for North American markets) (Toyota) and Venza crossover. (Toyota)
• PAVE published a Toyota-sponsored study into attitudes about autonomous vehicles. The main takeaway was, that with no mature examples of autonomous vehicles on the road, respondents are scared of them. (Toyota)

VW Group ^(history)

• Found itself at the centre of a social media storm over an Instagram advert that carried several racist cues. After initially prevaricating, VW apologised and withdrew the offending video. (Handelsblatt)
• Porsche has installed some cameras in non-sensitive areas of the factory so that anxious owners can receive a theme park-style photograph of their car in various stages of production. (Porsche)
• Porsche says that publicity from the online launch of the 911 Turbo S (arranged instead of the Geneva show) was far higher than products using press conferences at the show received in 2019. (Porsche)
• Agreed terms with German dealers for the launch of VW sales: dealers will get a flat commission, regardless of whether they or VW found the customer and VW will set all transaction prices and arrange all financing. The brand also appears to have granted infinite floorplan financing. (VW)
• A German court ruled that VW will have to pay damages over dieselgate in a case that was separate to the recently concluded class action suit. (Reuters)

Other

• Aston Martin’s CEO Palmer is leaving with immediate effect, to be replaced at the beginning of August by Tobias Moers, a recruit from Mercedes’s AMG division.
• McLaren’s recovery efforts hit a problem when existing bond holders complained that assets underpinning a proposed new debt issue was already security for their loans. (FT) The firm subsequently announced 1,200 job losses across the car making and racing divisions. (Sky)
• Faraday Future’s founder agreed a bankruptcy plan that saw him hand over his stake in the company to creditors, a move the firm hopes will help it raise further funding. (Faraday Future) Faraday’s CEO says the firm is in talk with several car makers about sharing technology. (Bloomberg)

News about other companies and trends

Economic / Political News

• European passenger car registrations in April of 1.345 million vehicles fell (78)% versus prior year. (ACEA)
• A leaked document purporting to outline a massive EU stimulus programme — with up to €80 billion targeted at clean mobility (split between vehicle purchases and grants) — set tongues wagging. (EURACTIV)
• The UK government set out proposed tariffs on imports to apply after the transition period with the EU ceases at the end of 2020. It confirmed that cars will attract a 10% tariff, the same as non-EU imports without a trade deal attract today. Tariffs for parts are still present, although reduced in some cases. The parts attracting zero tariffs (e.g. wing mirrors) suggest a degree of industry lobbying has been considered. (UK Government)
  • Significance: Although the government said it was protecting the automotive sector, the mix of vehicles produced locally (mainly luxury cars) doesn’t reflect the wider market, so the tariffs, if they came into force on EU imports, would be likely to have a distorting effect on sales. The published tariffs suggest a producer of vehicles using knock-down kits would save ~7% of the vehicle value over importers. Contact us for more details.

Suppliers

• Benteler reckons that plans by many European OEMs to have output at pre-lockdown levels by the summer are “ambitious”. (Autocar)
• Battery producer Exide entered Chapter 11 bankruptcy. (Exide)
• Gestamp reported Q1 2020 revenue of €2.17 billion and EBIT of €110 million. (Gestamp)

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

• Hertz filed for chapter 11 bankruptcy after lenders would not agree to extend re-payment deadlines. (Detroit News)
• Uber cut a further 3,000 jobs, brining the total to almost 7,000 in the last few weeks (about 25% of the global workforce). The CEO says the firm needs to become profitable and will withdraw from non-core activities, without fully describing what they are. (Business Insider)
• Ride hailing operator Ola cut 1,400 jobs, saying revenue fell (95)% in the last two months. (TechCrunch)
• Ride hailing service Bolt raised €100 million. (Reuters)
• The owner of ride hailing firm Tada raised around $5 million. (Deal Street Asia)

Driverless / Autonomy ^(history)

• The CEO of Intel’s Mobileye reckons there will be massive consolidation amongst companies developing self-driving technology because (he thinks) specialists will find it too hard to collaborate. (Reuters)
• Lumotive says it will have a new lidar sensor in customer’s hands by the end of 2020. With a range of around 120 metres — far less than some boast — the main selling point will be “competitive” cost. (Lumotive)
• Labelling company Scale AI and lidar developer Hesai launched an open source dataset of lidar traces that can be used to train systems on object recognition. (TechCrunch)
• Autonomous technology developer Hongjing Drive said it had raised millions of dollars. (TechNode)

Electrification ^(history)

• British battery start-ups AMTE Power and Britishvolt want to build a factory with a capacity of 30 GWh (or more), which would make it one of the World’s largest facilities. The scheme appears to have government backing. (AMTE)
• SVOLT says 2021 will see the debut of its cobalt-free batteries in vehicles made by Great Wall. (Autocar)
• Suspension supplier KYB signed a deal with in-wheel motor developer REE, enabling REE to develop packages incorporating wheel hub, power, braking and suspension. (REE)
• InoBat acquired a site in Slovakia for a low-volume battery production line and R&D centre, with plans to expand to a 10 GWh facility by mid-decade. (Green Car Congress)
• Media behemoth Liberty Global plans to start a high speed charging network in the UK using power from the kerbside cabinets that house its broadband equipment. (Bloomberg)

Connectivity

• HERE signed deals with address database Loqate and parking provider APCOA to embed its maps in other software (HERE) and map out European parking lots. (HERE)
• Alpine and Telenav are launching a usb stick that will upgrade an infotainment unit with smartphone integration so that it can access media streaming services and send vehicle data to the cloud. The device sounds in principle like a smartphone without a screen. (Telenav)

Other

• University researchers in Japan are trialling an inflatable electric scooter which bears a passing resemblance to a child’s Trunki rideable suitcase. Although the prototype has several drawbacks, the idea could develop into something that would be suitable for integration into a vehicle’s boot space. (IEEE Spectrum)
• Electric rickshaw developer Euler Motors raised an additional 20 Cr INR (about $2.7 million). (Autocar)
• Electric scooter rental service Tier has launched foldable helmets stored within the scooter. (Tier)
• By Miles, a mileage-based insurance company backed by JLR’s InMotion VC fund raised £15 million, but JLR did not participate. (By Miles)
• Autonomous drone developer Xwing raised $10 million. (Alven)
• A majority stake in bicycle rental service CityBike was sold to a private equity firm. (PE News)

SIGN UP TO GET THE WEEKLY BRIEFING EMAILED TO YOU

Find our archive here.