Automotive research, Automotive strategy, Automotive trends, Auto industry trends, Automotive market research, Auto industry news

Auto Industry Briefing — week ending 27th May 2018

The future of manual transmissions, safer self-driving car tests and electric vehicle sales forecasts. Please enjoy our auto industry and mobility briefing for 21st May to 27th May. A PDF version can be found here.

Favourite stories of the past week…?

  • Love Don’t Live Here Anymore Toyota sold a majority stake in a manual transmission factory to Aisin Seiki. In a world full of commoditised internal combustion engines, hybrids and electric vehicles, the outlook for the manual transmission business is dim. The only hope seems to be low cost (read: low margin) vehicles in emerging markets. Why aren’t OEMs rushing for the exit?
  • In The Air Tonight — Investigators released their preliminary report into the fatal crash of an Uber autonomous car and a pedestrian. Although the exact conclusions are still unknown, it seems likely that a series of best practice recommendations will emerge: no turning off OEM installed emergency systems (currently common practice); no turning off safety critical features just because they create unwanted false positives and greater reporting of near misses. If the pace of safety innovation is so dear to their hearts, why don’t self-driving programs just adopt these practices now before they are forced on them?
  • Being Small Isn’t Bad At All Honda are reportedly looking to produce 100,000 of their new electric city car per year. If Tesla think they can sell over 300,000 CD sized BEVs per year, VW think they can sell over 300,000 C sized BEVs, Daimler thinks Smart can go all electric and Honda (up until now a BEV sceptic) sees a market for 100,000 city cars, why are so many other brands just talking about BEVs as a product for regulatory compliance?

 

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

Find our archive here.

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News about the major automakers

 

BMW (history)

  • Investing €300 million in its Liepzig, Germany, plant to increase annual capacity from 250,000 units to 300,000 units, as a part of the change, volumes of i3 and i8 models will rise from 130 units per day to 200 units per day. (BMW)

Daimler (history)

  • Said it had been told to recall Vito vans by the German regulator but that it was disputing the basis of the order and would go to court if necessary. (Daimler)
  • Reportedly under investigation for emissions violations on other vehicles that use the Vito’s small diesel engine shared with Renault; the company may be forced to recall up to 600,000 vehicles. (Der Spiegel)

FCA (history)

  • Recalling over 5 million vehicles, 4.8 million of which are in the USA, to correct a fault that can lead to the driver being unable to cancel cruise control. (FCA)

Ford (history)

  • Will build a second, as-yet unspecified, model at its Craiova, Romania plant. The investment for the new vehicle is around €200 million and 1,500 new jobs will be created. (Ford)

Geely (includes Volvo) (history)

  • Increasing capacity for XC40 in both Europe and China saying demand for the car surpassed “even our highest expectations”. (Volvo)
  • In a sign that preparations for Volvo’s IPO are hotting up, the company had an obligatory “life after Ford” article published. In particular, the decision to create a Volvo-specific architecture and powertrain line-up were praised as key pillars of the company’s renaissance; pedants will note the article says these actions were kicked off in 2008, when the company was still two years away from a sale to Geely. (Bloomberg)

Honda (history)

  • Reportedly discussing production volumes of 100,000 units per year for an electric car battery supply contract with CATL — the undisclosed program bears all the hallmarks of the Honda Urban EV concept. (Electrek)

Hyundai / Kia (history)

  • Launching a Hyundai in-car payment facility with assistance from Xevo. (Hyundai)
  • Withdrew a group restructuring plan following hostility from activist investors. (Yonhap)

Nissan (includes Mitsubishi) (history)

  • Carlos Ghosn said a merger of Renault and Nissan was unlikely before 2020. (Bloomberg)
  • Alliance Ventures will invest in Maniv Mobility’s technology fund and aims to do a deal per month. (Reuters)

PSA (includes Opel/Vauxhall) (history)

  • Opel’s German unions demanded production and employment guarantees until 2025 for all sites as the price for a wage freeze and increased productivity. (Les Echos)
  • Improved the terms of its €3 billion revolving credit facility. (PSA)

Renault (history)

  • CEO Ghosn said a merger of Renault and Nissan was unlikely before 2020. (Bloomberg)
  • Alliance Ventures will invest in Maniv Mobility’s technology fund and aims to do a deal per month. (Reuters)

Suzuki

  • Toyota and Suzuki announced projects that could soon become formal partnerships: an ultra-high efficiency powertrain and Toyota producing vehicles in India for both brands to sell locally and in emerging markets. (Toyota)

Tata (includes JLR) (history)

  • Tata reported full year revenues of 294,243 Rs Cr (about $44 billion) for the 2017/18 fiscal year, an increase of 9% on a year earlier. PBT of 11,155 Rs Cr (about $1.7 billion) improved 20% YoY. (Tata)
  • JLR reported financial results for the 2017/18 fiscal year. Revenue of £25.8 billion was up 6% on a year over year basis. PBT of £1.5 billion fell (5)% from a year earlier (and further if special items were excluded). Although many media reports attributed the lower profit to Brexit and diesel’s decline in Europe, JLR said it was mainly due to investment in new vehicles and technologies. (JLR)
  • Confirmed the end of production for the Indica compact car. (Live Mint)
  • JLR announced a series of management changes and a reorganisation of the sales function. (JLR)
  • JLR’s venture arm invested in FATMAP, an outdoor activity planner. (JLR)

Tesla (history)

  • CEO Musk, replying to questions on Twitter, said the $35,000 version of the Model 3 would begin shipping 3-6 months after the 5,000 units per week production threshold was reached. (The Verge)
  • Updated the Model 3 braking system over the air following complaints from influential US reviewers Consumer Reports. (Engadget)
  • Settling a lawsuit from owners who said Tesla had under-delivered on its promises for Autopilot for $5 million, affected owners will receive between $20 and $280, their lawyers will probably do better. (Reuters)
  • Buoyed by registration figures from California which showed Model 3 at the top of the “Near Luxury” segment in Q1 2018, outselling both BMW 3 Series and Mercedes C-Class. (CNCDA)
  • Announced a series of new hires to executive positions. (Tesla)

Toyota (history)

  • Toyota and Suzuki announced projects that could soon become formal partnerships: an ultra-high efficiency powertrain and Toyota producing vehicles in India for both brands to sell locally and in emerging markets. (Toyota)
  • Announced a deal for Aisin Seiki to take a majority stake in Toyota’s transmission factory in the Philippines, with a view to increasing sourcing to the plant. (Toyota)
  • Expects to sell at least 30,000 fuel cell vehicles per year after 2020 and is installing additional capacity for fuel cell stacks to be ready for the anticipated demand. (Toyota)
  • Said that, despite the Indian government’s apparent targets for all new vehicles to be electric by 2030, it would likely take until 2050 for infrastructure to improve sufficiently. (Times of India)
  • Executives clarified that although Toyota will offer solid state batteries in the early 2020s, it won’t be “on a mass production basis”. (Wards)

VW Group (history)

  • Seat’s chief executive said the brand’s new SUV was bring built at a VW plant because a separate assembly line could not be justified with annual volumes below 150,000 vehicles. He also believes that diesel engines have no future in city cars. (Handelsblatt)
  • Porsche recalled around 2,000 wooden cars sold in North America because the wheels might fall off. (Porsche)
  • Said it would “probably not” implement WLTP for all vehicles on sale by the cut-off with the result that some vehicles would be “temporarily unavailable” and production could be disrupted. (VW)
  • Investigating “irregularities” in the homologation of VW Golfs sold in Ukraine recently. (VW)

Other

  • VinFast will use EDAG to develop the company’s first electric vehicle. VinFast are also working with Pininfarina on the car designs. (Autocar)
  • A Canadian business purchased a 10% stake in McLaren in a deal valuing the entire group at £2 billion. (McLaren)
  • GFG Alliance said it was targeting around 30,000 units per year production from the factory it intends to build in Australia. (The Guardian)
  • Aston Martin’s Q1 2018 revenues were £185.4 million with PBT of £2.8 million. Wholesales of 963 units were down from 1,203 units in the prior year; primarily due to the run out of old models. (Aston Martin)

News about other companies and trends

 

Economic / Political News

  • The German environment minister said OEMs were morally obliged to retrofit systems that would improve diesel emissions but that there were no legal means to force such an action. She said the costs (for a Germany-only campaign) would be “in the low single digit millions”. (Reuters)
  • China will relax import tariffs on cars from 25% to 15% effective 1st July 2018. (Detroit Free Press)
  • The US government will investigate the impact of car imports on national security, having employed a similar study to underpin tariffs on steel production. Given the net effect of exports from the USA (rather than figures concentrating on local production as a share of local consumption), and the lack of crossover between military and retail vehicle manufacturers or parts, a negative review would be quickly challenged by trading partners. (BBC)

Suppliers

  • Autoliv’s board approved the spin-off of Veoneer, which will begin trading on 2nd July 2018. (Autoliv)
  • Faurecia announced an investment in thermal management start-up Promethient. (Faurecia)
  • Mahle upped its stake in workshop equipment company BrainBee from 20% to 80%. (Mahle)
  • Dana opened a new thermal management systems factory in Yancheng, China. (Dana)

Dealers

  • Emerging markets online car sales company Frontier Car Group raised $89 million in funding. (Deal Street Asia)

Ride-Hailing, Car Sharing & Rental (history)

  • Uber’s Q1 results showed net revenue of $2.5 billion, and a net loss of $(601) million, with gross bookings at $11.3 billion. (TechCrunch)
  • Lyft’s COO said the driver base will “more than double” in the next five years. (CNBC)
  • Uber announced its intention to run a mini-diesel scrappage scheme for its London fleet, seemingly in a bid to butter up the city authorities to grant a new licence. (Reuters)
  • Uber will open a €20 million research centre in Paris, France to develop flying taxis. (The Guardian)
  • Go-Jek said it would invest $500 million in an expansion across South East Asia, looking to fill the void left by Uber’s (Go Jek)

Driverless / Autonomy (history)

  • Uber said it was closing its self-driving operations in Arizona, dismissing 300 employees. (AZ Central)
  • The NTSB released a preliminary report into the fatal Uber crash. The report detailed that the pedestrian crossing the road was first detected about 120 metres ahead of the vehicle, although the vehicle AI was unable to identify them as a person (with a bicycle). It also emerged that Uber had deactivated its own emergency braking systems and was completely reliant on the driver to react to prevent an accident. (NTSB)
    • Implication: Whilst the exact conclusions of the NTSB’s full investigation are yet to be published, a fair stab can be made at the likely recommendations: No deactivation of original OEM emergency systems; no dependency on manual operators for emergency manoeuvres; greater transparency around incidents, potentially with near miss reporting similar to aircraft incidents.
  • Apple is reportedly using VW’s ItalDesign factory to modify minbuses for use as autonomous vehicles on Apple’s campus. The same story also linked the company to self-driving developer Torc Robotics. (New York Times)
  • Sony’s CEO refused to deny aspirations to develop cars. (Bloomberg)

Electrification (history)

  • StreetScooter announced an order for 200 vehicles from a milk delivery firm. (Handelsblatt)
  • Rivian Automotive announced $200 million in debt financing. (Rivian)
  • BP invested $20 million in battery developer StoreDot (Daimler are already an investor). (Inside EVs)
  • Honda is reportedly discussing production volumes of 100,000 units per year for an electric car battery supply contract with CATL — the undisclosed program bears all the hallmarks of the Honda Urban EV concept. (Electrek)
  • Executives clarified that although Toyota will offer solid state batteries in the early 2020s, it won’t be “on a mass production basis”. (Wards)
  • Chakratec, developers of chargers augmented by flywheels, rather than batteries, raised $4.4 million. (Charged EVs)

Connectivity

  • Laird launched a Linux-based connected car platform called MAX. (Laird)

Other

  • Bicycle rental firm Ofo has created different advertising locations on the vehicle, with mudguard, wheel, basket and saddle placement offered. (Technode)

 

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Auto Industry Briefing — week ending 20th May 2018

Volvo without diesel, Nissan taking the fight to Tesla, a retail price point for driverless systems and how Waymo do it. Please enjoy our auto industry and mobility briefing for 14th May to 20th May. A PDF version can be found here.

Favourite stories of the past week…?

  • Follow Through Volvo say they won’t put a diesel engine in the S60. Given that diesel accounted for around 2/3 of European sales of the outgoing model, it will be interesting to watch how well volumes hold up and what the customer reception is to the alternative powertrain offering.
  • Give Me Everything Nissan now offers a home energy solution complete with solar panels and battery storage. Interestingly, customers will be able to choose between brand new and second life batteries. Is this new product stretching too far from the core or an example of new business lines OEMs need to offer to build consumer confidence around EVs (and secure demand for used batteries)?
  • Price Tag This week both Mobileye and Roadstar.ai said the retail price of the self-driving systems they are developing will be under $8,000. That’s a bit cheaper than the $10,000 or so most were expecting (based on supplier wholesale price data from the likes of Aptiv). But how much take up will there be at that level? Mobileye also talked about their 2,000-strong team of data labelling analysts in Sri Lanka, less clear is how these efforts scale as self-driving becomes a reality. Will hordes of desk-bound ground truth inspectors become labour nightmare for these new asset light firms? What happens if they go on strike? Does the system just stop getting better or does it start to get worse?
  • Method Man Waymo’s detailed application to offer a driverless ride hailing service in California emerged. It includes some interesting details about the current operating model (for instance, no intention of using remote drivers) and vehicle capability (if the vehicle encounters anything other than good weather, light rain or fog, it will pull over and go no further). Enjoy reading with a hot beverage!

 

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

Find our archive here.

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News about the major automakers

 

BMW (history)

  • Opened a new R&D centre in Beijing, China, with space for 200 personnel. (BMW)
  • Became the first non-Chinese auto maker to receive an on-road autonomous vehicle testing permit in China. (BMW)
  • Showed an outline sketch of the iNext vehicle, due in 2021 as an all-electric car with autonomous capability. BMW said a concept version would be presented later in the year. The outline implies a shooting brake or aggressively styled SUV. (BMW)

Daimler (history)

  • Investing €500 million in the Hambach, France, plant to produce a new generation of all-electric Smart brand cars and a new compact Mercedes EQ model. (Daimler)
  • Production at the Alabama, US plant was disrupted for several days by the fire at Meridian Magnesium. (Reuters)
  • Unveiled a new range of smartphone covers and computer bags. Daimler refused to release profit or market share objectives for the new products. (Daimler)

FCA (history)

  • Rumoured details of FCA’s new strategy, set for a 1st June reveal, emerged. The company apparently plans to move small and mid-sized car production out of Italy, in part replaced by larger Jeep and Maserati products. The Fiat brand may shrink to only 500 and Panda derivatives (and presumably van-derived models). (Bloomberg)
  • Internal emails turned over as evidence for diesel cheating court cases against FCA revealed supplier staff questioning FCA’s compliance approach and the CEO’s disapproval of a US spokesman’s comments in 2015, just after the VW diesel went public, saying that FCA was squeaky clean. (Reuters)
  • Announced a recall of almost 49,000 SUVs to correct fuel supply problems. (FCA)
  • The theft of eight new Ram pick-up trucks from an FCA compound set Detroit tongues wagging as clues pointed to an inside job. (Detroit Free Press)

Ferrari

  • Announced a new CFO as the old one pursues “further career opportunities” (he’s off to Honeywell). (Ferrari)

Ford (history)

  • Issued safety recalls for a small amount of pick ups to fix problems with parking brakes. (Ford)

Geely (includes Volvo) (history)

  • Volvo said there will be no diesel version of the new S60 and the company “will no longer develop a new generation of diesel engines”. (Volvo)
  • Volvo’s CEO said the company had sufficient funds to invest in electrification and autonomous vehicles with or without an IPO. (Reuters)
  • Volvo’s CEO said plug-in hybrids were taking 15% of sales in vehicles where it was offered. The brand is targeting for 25% of sales (in certain markets) to use its subscription service “within five years”. He said that company was cutting back on ICE development, “you cannot invest money in even more advanced diesel engines and even more advanced gasoline engines… that money needs to go towards electrification”. (Automotive News)
    • Implication: In context, it appears likely he was referring to substantial architecture upgrades rather than any engine development (since “electrification” for Volvo includes 48V).

Hyundai / Kia (history)

  • Hyundai’s Cradle venture fund invested an undisclosed amount in radar start-up Metawave. The company claims that its “next generation” radar can see over 150 metres with high resolution. (Hyundai)

Nissan (includes Mitsubishi) (history)

  • Reported financial results for the 2017/18 year. Net sales of 11.95 trillion yen (about $110 billion) were up 2% on the prior year, operating income of 574.7 billion yen (about $5.2 billion) was down (22.6)%. In the coming financial year, Nissan expects sales to be slightly better but operating profit to decline slightly to 540 billion yen. (Nissan)
  • Nissans CEO said there was no merger negotiation going on with Renault but acknowledged that the two companies continue to discuss their future relationship. (Les Echos)
  • Announced a new CFO, their predecessor is retiring. (Nissan)
  • Launched a new offering in the UK that provides solar panels, stationary storage and home energy management (potentially including vehicle charging). Customers will have a choice of either brand new or used electric vehicle batteries. (Nissan)
  • The implied take rate of Nissan’s ProPILOT driver assistance technology suite is around between 20% – 25% on vehicles where it is offered. (Nissan)

PSA (includes Opel/Vauxhall) (history)

  • Peugeot’s UK sales chief said the brand had “no real desire to get back into the real hot hatches”, expressing a preference for crossovers. He commented on the company’s emphasis on capital efficiency, citing RCZ as an example of the type of product PSA would no longer green light because, although “lovely to have for some of our motorsport fans”, due to small volumes the vehicle “would never make any money”. (Shropshire Star)
  • Faurecia held a capital markets day, providing detailed 2020 financial targets and some outlook to 2030 for emerging sectors. By 2020, the company is aiming for €20 billion of revenue and operating margins of 8%. (Faurecia)
  • Used car sales arm AramisAuto acquired Belgian company Cardoen for “tens of millions of euros”. (Les Echos)
  • Announced some changes to the executive team, the VP for Eurasia was re-assigned to work for the Opel sales and marketing director, indicating either a massive demotion or a special projects role ahead of retirement. (PSA)
  • In talks with French unions to increase the working week, from 35 hours to 37.5 hours in return for a 2.8% pay increase. Although PSA are only currently asking about one plant, unions fear setting a precedent. (France Info)
  • Opel is shutting its national sales companies in Sweden and Denmark and will instead use an importer. (Opel)

Renault (history)

  • Said Nissan’s Q1 2018 results would contribute €478 million to Renault’s net income. (Renault)

Tesla (history)

  • Registered a new entity in China. Media reports speculated that this was for the company’s forthcoming Shanghai plant but Tesla refused to comment on the purpose of the new company. (Business Insider)
  • Criticised for rejecting driver monitoring methods that might ensure drivers were paying attention when using the Autopilot system. CEO Musk clarified the systems were rejected on reliability, not cost, grounds. (The Verge)
  • Will reportedly have a further weeklong stoppage at the end of May at Freemont to install machinery that will increase production capacity. (Reuters)
  • Waiting times for brand new Model 3 orders have reportedly fallen from 18 months to 6 months. (Electrek)

Toyota (history)

  • Announced a 400 million yen investment in big data company Albert, and a joint project to improve data for self-driving vehicles. (Toyota)
  • Toyota AI Ventures invested in radar start-up Metawave’s $10 million round. The company claims that its “next generation” radar can see over 150 metres with high resolution. (Metawave)
  • Will only sell hybrid versions of the Auris in Spain, stopping all diesel and gasoline ICE only models. (Europa Press)

VW Group (history)

  • Porsche recalled 918 Spyders to fix issues with corrosion in the suspension. (Bloomberg)
  • The VW brand confirmed that it won’t attend the Paris motor show this year. (Reuters)
  • Started production of I3 gasoline engines at its Hungary engine plant. (VW)

Other

  • Chinese OEM FAW will invest about $260 million in Byton. (Deal Street Asia)
  • GAC Motor announced a new international division that will combine existing operations in the US with new offices in South America, Africa and the Middle East. (GAC Motor)
  • Isuzu reported 2017/18 financial year results and issued a near term strategic update. The company is particularly keen to manage the transition to electrification at the same time as it believes traditional powertrain sales will continue to grow. It also wants to create new businesses that move it deeper into the logistics business. (Isuzu)

News about other companies and trends

 

Economic / Political News

  • European passenger car registrations for April of 1,306,273 units, up 9.6% on a year over year basis. (ACEA),
  • Autocar magazine collected comments from executives at assorted OEMs about the impact of moving to WLTP The consensus seemed to be that the impact to consumers would be the loss of engine types no one really cares about and perhaps some waiting list for less popular models as brands worked through testing backlogs (because WLTP tests items regarded as unimportant by NEDC). (Autocar)
  • Data released by the EU showed vans sold in 2017 emitted on average 7.7 grams of CO2 per km less than in 2016. The fleet is now only 6% / 9g away from the 2021 target. (EU)
  • The EU said regulators in the UK, Germany, Italy and Luxembourg had been too lax in properly enforcing vehicle type approval rules. (Der Spiegel)
  • A report in the USA said that keyless ignitions were responsible for dozens of deaths in the country because people were forgetting to turn off their cars when they got home and then inhaling carbon monoxide. (BBC)

Suppliers

  • Indian supplier Precision Camshafts acquired 51% of Dutch electric drivetrain converter EMOSS. (Autocar)
  • Denso invested in radar start-up Metawave’s $10 million round. The company claims that its “next generation” radar can see over 150 metres with high resolution. (Metawave)
  • Cooper Standard acquired 80.1% of Korean supplier LS Mtron. (Autocar)
  • Mobileye reportedly won a contract for 8 million EyeQ5 based driverless systems from 2021 onwards. (Reuters)
  • Faurecia held a capital markets day, providing detailed 2020 financial targets and some outlook to 2030 for emerging sectors. By 2020, the company is aiming for €20 billion of revenue and operating margins of 8%. (Faurecia)
  • Maxwell Technologies will supply ultracapacitors to Volvo and Geely for five, and possibly more, vehicles with shipments starting in 2019. Applications are 48V and plug-in hybrids. (Inside EVs)
  • Continental increased its investment in head-up display company DigiLens, it now has an 18% stake. (Continental)

Dealers

  • Profits rose at Spanish dealers in 2017, up from 1.88% to 1.9%. (Europa Press)

Ride-Hailing, Car Sharing & Rental (history)

  • Speaking about flying taxis (but with implications for self-driivng cars) Uber’s CEO said in an interview that “we don’t know where the capital [to buy the vehicles] will come from, but we don’t think that this model necessitates our being the capital provider”. (The Verge)
  • Chinese ride hailing firms Shouqi Limousine and e-driver signed a cooperation agreement to offer each other’s services on their respective apps. (Shouqi Limousine),
  • Labour activists created an advert to bring attention to the pitfalls of the gig economy for ride hailing drivers. The campaign not only stars Pamela Anderson, it also features her analysis (and criticism) of the situation facing drivers. When the history of ride hailing is written, will this prove to be a decisive turning point? (Press Release)
  • Drivers for Ola and Uber in India went on hunger strike demanding that the networks reduce their commission and stop adding new drivers. (Economic Times of India)
  • Lyft claimed US market share of over 35% but others, including Uber sources, put the figure at under 30%. (CNBC)

Driverless / Autonomy (history)

  • US / Chinese autonomous car start-up ai announced $128 million in funding and released a kit called Aries that it says enables L4 autonomous capability for under $8,000 per vehicle. (Roadstar.ai)
  • Mobileye’s CEO put the retail cost of the company’s fully autonomous driving solution (mostly camera-based but apparently to eventually include some “backup” radar and lidar” at under $8,000. He also divulged some of the resources required to help AI develop, the company has a team of “more than 2,000” analysts in Sri Lanka labelling data collected by Mobileye sensors. (Bloomberg)
  • Waymo’s detailed application for a Californian permit to operate self-driving vehicles in a limited commercial trial showed several interesting elements of their set-up. (Mark Harris)
    • Page 19 says Waymo does not currently have (or plan to use) remote operators to pilot the vehicle (indicating that in the event of a problem, operators will go to the vehicle).
    • Page 21 describes the geo-fenced area that the vehicles will be allowed to cover, including roads with speed limits of up to 65 mph (although it doesn’t say the vehicles will travel this fast) and that vehicles will operate in good weather, light rain and fog (indicating issues with other conditions, potentially for reasons of both sensor capability and vehicle control).
    • Page 22 says that in the event of bad road conditions or weather, vehicles will safely pull over, not try to complete their journey.
    • Page 24 shows Waymo’s proposed geofenced zone. Vehicles will only carry out journeys that start and end within the geofence.
  • Hyundai’s Cradle venture fund, Toyota AI Ventures and Denso invested in radar start-up Metawave’s $10 million round. The company claims that its “next generation” radar can see over 150 metres with high resolution. (Metawave)
  • The implied take rate of Nissan’s ProPILOT driver assistance technology suite is around between 20% – 25% on vehicles where it is offered. (Nissan)

Electrification (history)

  • Arrival won a trial electric delivery van contract from UPS, adding to earlier orders from Royal Mail. (Journal Auto)
  • Geely’s LEVC published the results of a study that showed taxi drivers experienced lower stress when driving an electrified vehicle. (LEVC)
  • Nissan launched a new offering in the UK that provides solar panels, stationary storage and home energy management (potentially including vehicle charging). Customers will have a choice of either brand new or used electric vehicle batteries. (Nissan)

Other

  • Nest’s connected home appliances system suffered an outage, resulting in users being able to only use devices by (gasp) touching them. This failure might be of interest to those looking at connected systems, bearing in mind that since Nest’s owner is Google, the expectation would be that the company’s infrastructure isn’t shabby. (The Verge)
  • Electric scooter rental company Skip raised $6 million to start operations in Washington DC. (TechCrunch)

 

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Auto Industry Briefing — week ending 13th May 2018

Profiting from car data, connectivity the BYD way, personalised driverless cars and the difference between leasing and subscribing. Please enjoy our auto industry and mobility briefing for 7th May to 13th May. A PDF version can be found here.

Favourite stories of the past week…?

 

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

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News about the major automakers

 

BMW (history)

  • The Rolls-Royce Cullinan SUV was revealed. The monster SUV features luxurious interiors, recycled TE Lawrence quotes, a hefty price tag and optional “activity modules”. (Rolls Royce)
  • Rolls-Royce’s CEO said the new architecture underpinning Cullinan, but to be shared with other future models, is “ready for electrification and other changes as well”. (Autocar)
  • Working on an electrification strategy that will involve three sizes of pack: 30e (60 kWh), 40e (90 kWh) and 50e (120 kWh) and two sizes of cell (one for cars and a taller one for SUVs). (Automotive News)
  • Car sharing subsidiary ReachNow will end its free-floating service in Brooklyn, New York, citing high maintenance and damage costs. The company will continue the business model elsewhere, indicating ReachNow views the problems as location-specific. (GeekWire)
  • Extended an existing recall in the UK after journalists revealed the problems were more prevalent than BMW had said. The number of affected vehicles rose from 36,410 to 312,000. (BBC)

Daimler (history)

  • Became an investor in SoftBank’s Vision Fund. (Deal Street Asia)
  • Released pictures of test mules for the EQC all-electric SUV, saying that it had around 200 vehicles under test ahead of the 2019 launch date. (Daimler)

FCA (history)

  • Announced a recall of almost 240,000 SUVs to replace lower control arms. (FCA)
  • CEO Marchionne met President Trump asking for an outcome that will “preserve a national program that drives continuous improvement” (i.e. stop California and others creating their own rules) that also “allows us to build vehicles customers want, at prices they can afford” (i.e. regulations that aren’t tough so we don’t have to pass on costs to consumers — or more likely — absorb them ourselves). (FCA)
  • CEO Marchionne said proposed revisions to NAFTA local content rules would require the company to redirect some of the supply from its Mexican plants, but production would still go ahead. (Economic Times of India)

Ford (history)

  • Had to shut three truck plants following a fire at Meridian Magnesium, a supplier of critical F-Series components. The company will reportedly have resourced the parts by the end of the week commencing 14th May and said that full year earnings would not be affected, but remained tight-lipped on near term impacts, indicating a Q2 hit that will be recovered later in the year. (Ford)
  • Chairman Bill Ford said the company is looking to make “fairly large” changes that “could” affect regions and/or functions. He also proclaimed himself “really pleased” with CEO Hackett’s learning curve. (News 18)

Geely (includes Volvo) (history)

  • Geely has reportedly selected three investment banks to advise on an IPO for Volvo with a target valuation of $16 billion to $30 billion. (Bloomberg)
    • Implication: What does this mean for Geely’s stake in Daimler and Volvo Trucks? Is the Volvo sale to fund the acquisitions? Are these stakes meant to boost Volvo’s potential future value and then be sold off again later? Eight years after Geely purchased Volvo from Ford, the two companies seem less integrated than, for instance, Renault and Nissan.
  • German financial regulators decided that Geely’s acquisition of a near-10% stake in Daimler did not meet disclosure rules. Although penalties for breach can be severe, Geely appeared to regard the regulator’s findings as a retrospective technicality, that in any case mean the stake should only have been disclosed a day earlier. (Reuters)
  • Lotus’s CEO said that the company could continue using Toyota-sourced powertrains in vehicles under development, but implied Volvo will be the engine supplier for SUVs and crossovers and could take over as Lotus embraces electrification, although “there are some years left for combustion engines”. (Autocar)
  • Having previously announced Google’s Android would underpin the next-generation Sensus infotainment system, Volvo confirmed that Google apps will be embedded by design and provide the same level of functionality as vehicles equipped with Android Auto, but not requiring an Android-equipped phone. (Volvo)
  • Volvo cars will have data links with Volvo trucks (in Scandinavian countries) and share details of hazards and alerts encountered with the aim of improving emergency response and avoiding accidents. (Volvo)

General Motors (history)

  • Announced the restructuring plan for its South Korean unit, which GM hopes will return to profit by 2019. Two new vehicles (an SUV and a crossover) and an I3 engine will be developed and manufactured there. (GM)
  • South Korean government agencies were less bullish on GM’s turnaround plan for the country, saying a third party assessment forecast the unit would not be profitable until 2022. Even so, the government appeared happy enough to provide $750 million in funding for GM’s investment because it gains a 10 year veto over asset sales. (Reuters)
  • GM’s strategy chief says that personalised autonomous cars will be “big business”, particularly for customers in rural areas where the company believes ride hailing will take a long time to propagate. May partner with “one company, several companies or no companies” for autonomous ride hailing, particularly influenced by the network effects the company has observed — GM believes that unless there is sufficient fleet density to deliver an on-demand ride within 5 minutes, customers will look elsewhere. GM is also looking at how to join up trips starting in a geo-fenced AV area but ending outside it. GM says it will take around 6 months to enter a new market with AVs. (GM)
    • Implication: GM’s strategy may turn out to be right, for the wrong reasons. Firstly, if rural customers cannot afford lavish customisation now, why will they be able to in the future? As yet, there isn’t any evidence these consumers will have the means to pay extravagant amounts for either autonomous vehicles or further embellishments. Secondly, “rural” areas are often nowhere near as sparsely populated as many imagine — only 9.5% of Americans (about 30 million people) live in areas with fewer than 50 people per square mile. A ride hailing vehicle placed in the theoretical centre of each square mile can still find plenty of business, and quickly respond to a ride request (only 0.7 miles from anywhere in the square — admittedly as the crow flies).

Hyundai / Kia (history)

  • Reportedly having problems fulfilling orders for the Hyundai Ioniq in North America due to shortage of the outgoing battery pack. (Green Car Reports)

Mazda

  • Announced a series of management changes, including naming Akira Marumoto as incoming-CEO. (Mazda)

Nissan (includes Mitsubishi) (history)

  • Mitsubishi reported 2017/18 fiscal year financial results. Revenue of 2.2 trillion yen (~$20 billion) rose 15% on a year earlier whilst operating profit of 98 billion yen (~$900 million) was almost 20 times the prior year. (Mitsubishi)
  • Plans to “discontinue diesel gradually from passenger cars at the time of each vehicle renewal”. (Reuters)

PSA (includes Opel/Vauxhall) (history)

  • Opel’s works council agreed to allow workers already signed up for early separation to leave, subject to a cut-off date at the end of May, but younger workers will no longer be able to apply for the program. Opel’s CEO claims fixed costs have already been reduced by 17% from when PSA acquired the company. (Handelsblatt)
  • Faurecia invested in wireless charging start-up Powersphyr. (Faurecia)
  • Selected Punch Powertrain, suppliers of an integrated dual clutch transmissions and 48V motor, to provide electrified drivetrains, with a view to potentially in-sourcing production to a PSA plant. (PSA)
    • Implication: Choosing a solution where the 48V system is mounted on the transmission rather than the engine may be an elegant approach that saves PSA having to redesign the engine installation of all its vehicles (providing the new transmission fits in nicely)
  • Opel will use a PSA-supplied connectivity package and phase out GM OnStar (only launched in vehicles recently) at the end of 2020. (Opel)
  • Vauxhall and Opel are reportedly planning a hybrid-only sports hatchback “VXR” trim level. (Auto Express)
  • Hopes to sell 90,000 508s each year (70% diesel mix), once the refreshed version comes out. (Les Echos)

Renault (history)

  • CEO Ghosn said customers no longer suffer from range anxiety in electric cars “as long as you guarantee more than 300 km”. (Clean Technica)
  • Simplified its line-up in the UK so that there are only three trim levels on major products (from lowest to highest): Play, Iconic and GT Line. (Autocar)

Tesla (history)

  • Tesla’s top safety executive defected to Waymo and the head of engineering took a leave of absence. (Bloomberg)
  • Initiated a company-wide ban on every individual third party contractor without “a Tesla employee putting their reputation on the line for them”. (Electrek)
    • Implication: As a statement of intent, these moves have a powerful impact. As a management tool, they will quickly become less than satisfactory — how will it be possible for Tesla to take on any individuals who lack a work history with Tesla employees? What may initially sound like a fantastic approach to productivity quality control can quickly tailspin into nepotism.
  • Supplier orders indicate that Tesla has confidence in 5,000 per week Model 3 goal; a Chinese supplier of displays is reportedly preparing to ship 58,000 units in Q3. (Bloomberg)
    • Implication: Whilst potentially confirming that Tesla are on track, beware reading too much into long-lead items which Tesla has a high confidence in using anyway and needs to order to ensure supply, regardless of whether or not it can be certain of the near-term production schedule.

Toyota (history)

  • Reported financial results for the 2017/18 fiscal year. Net revenue of 29.4 trillion yen (~$270 billion) was 6% better than the prior year, despite a small decline in wholesales. Operating income of 2.4 trillion yen (~$22 billion) was up 20% on 2016/17. Toyota said exchange was a big part of explaining both increases. (Toyota)

VW Group (history)

  • Audi is targeting €1 billion in operating profit annually from digital services by 2025. The brand also expects the refreshed A7 and A8, along with Q8 and eTron SUVs to increase large car sales by 50% by 2022. (Audi)
  • Recalling 2018 model year Polo small cars to correct problems with rear seat belts. (VW). The same problem also affects SEAT Ibiza and Arona models. (SEAT)
  • Audi announced “irregularities” in the engine management software of V6 diesel engines. The company has halted sales of new vehicles and the circa 60,000 cars in private hands will receive an as-yet-undetermined upgrade. (Audi)
  • The head of the Porsche SE board said in an interview that the VW Works Council should have a say in issues about employees but should not claim to co-manage the business. (Stern)
  • New VW Group CEO Diess reportedly met with US diesel scandal investigators shortly before the indictment of former CEO Martin Winterkorn was issued, leading to speculation that he could have provided evidence that implicated Winterkorn. (Reuters)

Other

  • Subaru reported 2017/18 financial year results. Revenue of 3.4 trillion yen (~$31 billion) was up 2.4% on a year earlier, operating income of 379 billion yen (~$3.5 billion) fell (7.6)%. (Subaru)
  • Borgward launched two new models, the BX6 SUV and the all-electric BXi7 SUV. (Borgward)
  • The CEO of Elio Motors said the company has 65,000 pre-orders for its intended 3 wheeled vehicle but requires significant capital (over $375 million) to bring the vehicle to market. (KSLA)

 

News about other companies and trends

 

Economic / Political News

  • Chinese customs officials have reportedly been conducting “extra technical checks” on imported vehicles from the likes of Ford, BMW and Daimler in recent weeks. (Reuters)

Suppliers

  • Meridian Magnesium Products suffered a plant fire, affecting production for several OEMs including Ford, FCA, GM, Audi and Mercedes. (Lansing State Journal)
  • Magna announced financial results for Q1 2018. Revenue of $10.79 billion increased 21% on a year-over-year basis, adjusted EBIT of $875 million was up 7% YoY. (Magna)
  • Delphi reported Q1 2018 revenue of $1.3 billion and operating income of $138 million. (Delphi)
  • Bridgestone released financial results for Q1 2018, net sales of 859 billion yen were about flat, operating income of 99 billion yen was down (3.1)% on the prior year. (Bridgestone)
  • Faurecia invested in wireless charging start-up Powersphyr. (Faurecia)
  • Intel Capital invested in computer vision and machine learning firm Reconova. (Deal Street Asia)
  • Continental reported revenue of €11 billion and adjusted EBIT of €1.1 billion for Q1 2018. (Continental)
  • Clean Wave will supply electric motors and drive units for XING Mobility’s forthcoming supercar. (XING)
  • Hyundai Mobis aims to produce its own digital screens; at present it integrates screens from Denso and Continental into instrument panels it assembles. (Yonhap)
  • ZF will close its Friedrichshafen facility, Germany by the end of the year. (de)
  • Schaeffler announced financial results for Q1 2018. Revenue was €3.6 billion and adjusted EBIT was €391 million. The firm will undergo a modest reorganisation, cutting 950 jobs globally, but says no sites will be closed. (Schaeffler)
  • Magna opened a new aluminium casting facility in Telford, UK, under the Cosma banner. The anchor customer is JLR. (Magna)
  • Continental signed an agreement with UFI Filters to sell UFI’s products in the aftermarket. (Continental)

Dealers

  • Consumer finance in the UK has now reached 89.4% on retail sales over the last 12 months. (FLA)
    • Implication: For all the talk about subscription services being an emerging phenomenon, in some markets retail customers aren’t far from that reality, it just goes under a different name. Yes, there is a capital tie-up and, yes, the lock in periods are several years; but possession has supplanted ownership so comprehensively that perhaps customers are ready for something different.

Ride-Hailing, Car Sharing & Rental (history)

  • UK bus company Go-Ahead will launch an on-demand minibus service using technology supplied by Via. (Reuters)
  • Didi Chuxing suspended its car-pooling offering, Hitch, following the murder of a passenger. Although the suspect was not the Didi account holder, he appeared able to defeat the facial recognition software used by the company to verify the identity of riders and drivers. (China Money Network)
  • Grab introduced a range of services for users with restricted mobility, called GrabAssist. The service costs more per mile and Grab takes a reduced commission (but for how long?). (Grab)
    • Implication: Since many business forecasts for on-demand mobility assume massive demand growth from users with restricted mobility, it will be interesting to see whether the new service catches on.
  • Uber held a conference about flying taxis, saying its own offering would launch in 2023 and cost $5.73 per passenger mile, falling to $0.44 per mile at some unspecified future point. (TechCrunch)
  • Japanese bus drivers in the city of Okayama went on strike. Unusually, rather than gather around burning dustbins in donkey jackets, the buses kept running but the drivers refused to collect fares. (BBC)
  • Peer-to-peer car rental start-up SizeCar launched in Ukraine, saying the country lacked good rental options outside major cities. (Auto Rental News)
  • Lyft reportedly has waiting lists to sign up to its monthly subscription service — for $200 you get 30 (up to $15) rides per month. (TechCrunch)
  • BMW’s car sharing subsidiary ReachNow will end its free-floating service in Brooklyn, New York, citing high maintenance and damage costs. The company will continue the business model elsewhere, indicating ReachNow views the problems as location-specific. (GeekWire)

Driverless / Autonomy (history)

  • Uber’s CEO said the company will resume testing autonomous vehicles in “the next few months, I don’t know”. Uber has reportedly determined that the decision software was at fault for the recent fatal crash; the car spotted the pedestrian but, under a protocol designed to reduce false positives, decided to continue its present course rather than swerve or avoid them. (The Information)
    • Implication: Although linked to decision making, the need for a false positive elimination is a symptom of inaccurate object recognition. If the report is correct, it appears that either Uber cannot create high confidence object recognition at higher speeds and longer ranges; or that it forgot to remove a workaround created for earlier testing. Read our analysis of why object recognition is harder than you think here.
  • ai will offer a ride hailing service using autonomous vans starting this summer in Texas — the small number of vehicles in the fleet may hamper efforts to recruit customers. (Bloomberg)
  • GM’s head of strategy said it will take around 6 months to learn a new city. (GM)

Electrification (history)

  • Enel’s eMotorWerks unit announced a new charging product that balances electrical load using software and makes it easier for fleets to install additional charging units as the number of electric vehicles grows. (Enel)
  • ElringKlinger will supply battery systems for Sono Motors, a start-up planning a city car augmented with solar charging. (Economic Times of India)
  • Rolls-Royce’s CEO said the new architecture underpinning Cullinan, but to be shared with other future models, is “ready for electrification and other changes as well”. (Autocar)
  • Fisker may change their plan for the EMotion sportscar and go back to solid state batteries at launch (having previously said they were switching from solid state to conventional LG cells). CEO Henrik Fisker said he was “pushing the team” to get the technology ready for a 2020 launch. (Inside EVs)
  • Motorhome maker Winnebago and Motiv Power are creating a new electrified commercial vehicle platform with an expected range of 85 – 125 miles. Winnebago will also invest in Motiv Power. (Green Car Congress)
  • Renault and Nissan will reportedly use batteries sourced from CATL for China-market BEVs. (Electrek)
  • Nidec launched a 320 kW charger with an inbuilt 160 kWh battery that reduces grid drain to 50kW. (Inside EVs)
    • Implication: Fast chargers seem to be almost universally regarded as a necessary part of electrification infrastructure, yet in many locations the grid simply cannot supply the necessary power without substantial upgrade. Solutions such as this seem to offer the best of both worlds for small installations — given the cost of batteries, larger sites will probably justify getting the infrastructure sorted.
  • Charging station supplier Clipper Creek has started offering used chargers. (Clipper Creek)

Connectivity

  • BYD is launching a new platform that will give third parties access to the full gamut of in-vehicle sensors (341 by BYD’s count) and controls (66). (BYD)
    • Implication: Not only are BYD giving third parties access to the car (a rarity for most OEMs), they are allowing a much deeper relationship — far beyond interactions with only the in-car entertainment. BYD and their partners (presumably a lot of which will be Chinese) will benefit from the increased consumer insight the move will bring, and will gain a head start on developing technologies and solutions whilst other OEMs try to guard access to the vehicle (a move that may prove fruitless in the long run). If other Chinese OEMs follow BYD’s lead, this may also become an area where Chine leapfrogs the West.
  • Having previously announced Google’s Android would underpin the next-generation Sensus infotainment system, Volvo confirmed that Google apps will be embedded by design and provide the same level of functionality as vehicles equipped with Android Auto, but not requiring an Android-equipped phone. (Volvo)
  • Opel will use a PSA-supplied connectivity package and phase out GM OnStar (only launched in vehicles recently) at the end of 2020. (Opel)

Other

  • Walmart said it was continuing on-demand grocery delivery, but would no longer use Lyft or Uber. (Reuters)

 

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Auto Industry Briefing — week ending 6th May 2018

The end of Tesla technology leadership, rumoured UK 2040 range requirements and PSA’s retail strategy. Please enjoy our auto industry and mobility briefing for 30th April to 6th May. A PDF version can be found here.

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News about the major automakers

 

BMW (history)

  • Released financial results for Q1 2018. PBT of €3.165 billion was slightly down on Q1 2017, revenue of €22.7 billion was down (5.2)%. (BMW)
  • Said that Minis produced in India have 50% local content and the company may start selling BMW PHEVs in the country if it can identify the right product. (Autocar)
  • BMW developed an electric scooter that it might supply to third parties if it finds sufficient demand. (Autocar)

Daimler (history)

  • Ceasing production of home storage batteries, saying that in future it will offer third party products more suited to stationary storage applications. Daimler intends to continue to supply used vehicle batteries for industrial storage units. (Manager Magazin)
  • CEO Zetsche said the company has plans in place to resist a hostile takeover (whether by Geely or anyone else) but that the scenario was “theoretical”. (Automotive News)

FCA (history)

  • Suffered production stoppages at the Brampton, Ontario plant because of supplier strikes. (Auto Evolution)

Ferrari

Ford (history)

  • Created a JV with existing low cost electric vehicle partner Zotye to create all-electric vehicles aimed at ride sharing fleets and drivers. (Ford)

Geely (includes Volvo) (history)

  • Moody’s upgraded Volvo’s credit rating to Ba1. (Volvo)

General Motors (history)

  • Autonomous vehicle AI provider Algolux raised $10 million, led by GM Ventures. (FINSMES)
  • Said that 3D printing could reduce the weight of structural body components by 40%, whilst improving strength. The press release implied that GM intends to incorporate the technology into vehicles currently under development. (GM)

Nissan (includes Mitsubishi) (history)

  • Renault CEO Ghosn said “nobody can answer this question” when asked whether Renault and Nissan would merge by 2022. He also said that “more than 95%” of vehicle content needs to be Chinese to be competitive in China and that this requires joint ventures. (Macau Business)

PSA (includes Opel/Vauxhall) (history)

  • Opel’s CEO said the plan for the next generation Mokka X had been completely changed since the PSA takeover because the intended GM platform was “heavy and doesn’t offer electrification”. (Auto Express)
  • CEO Tavares offered to share benchmarking data, including cost and operational details of PSA plants outside Germany, to convince German unions of the case for change. (Manager Magazin)
  • Reportedly hired Tata Consulting to help it improve in low cost cars. The targets are said to be: 90% localisation and production costs 1/3 lower than the best Western plants. (Les Echos)
  • Has merged its UK wholly owned dealers into a single company and is targeting further expansion into Vauxhall sites, recently buying four under the Go Vauxhall brand. (Vauxhall)

Renault (history)

  • Renault CEO Ghosn said “nobody can answer this question” when asked whether Renault and Nissan would merge by 2022. He also said that “more than 95%” of vehicle content needs to be Chinese in order to be competitive in China and that this requires joint ventures. (Macau Business)

Tata (includes JLR) (history)

  • Tata Motors is to sell its defence and aerospace division to Tata Advanced Systems. (Autocar)

Tesla (history)

  • Announced financial results for the first quarter 2018. Tesla made a loss of $(784) million on revenues of $3.4 billion. Automotive revenue of $2.7 billion rose 19% on a year-over-year basis. (Tesla)
  • Held an earnings call with CEO Musk in a combative mood, cutting off the analyst questions in favour of non-financial details. Although Musk did reveal that he is expecting Model 3 to get a 30%-40% share in premium sedans (cynics shouldn’t scoff about comparisons to non-existent segments, Musk is talking about 3-Series and C-Class, not Fusion and Malibu), unfortunately he refused to expand upon the “Customer Deposits” line in Tesla’s financial statements — a potential good news story which has grown substantially in recent quarters — indicating some support for Musk’s bullishness on Tesla’s offering (he said Semi reservations were about 2,000 units). (Seeking Alpha)
  • After the call, Musk said he shouldn’t have ignored the analyst questions, but defended his actions on the basis that he believed they were trying to justify a short position (they weren’t). (Reuters)
  • Said on the conference call that its best single hour production rate for Model 3 was equivalent to 5,000 units per week and that improvements in uptime will help it sustain that level soon — working a continuous shift pattern. Executives described operations with less intensive manning as “foolish”. CEO Musk also detailed several unremarkable cost and time saving ideas the company had implemented, describing a revolutionary way of listening to employees that sounded a lot like the decades-old idea of quality circles. Seasoned production hands will also be surprised to know that software is the biggest part of a successful production system.(Seeking Alpha)
    • Implication: It should be a concern that senior Tesla executives, who normally exhibit good command of detail were caught out by questions from Barclays are manufacturing line pacing and showed a clear misunderstanding of best in class levels or how they are measured. The CFO also said that depreciation per unit would be under $2,000 per unit at scale “well below most competitors” even though CapEx of 4% of (wholesale) revenue is becoming an industry norm, and $2,000 is 4% of $50,000 — quite above the average wholesale revenue of Model 3 competitors.
  • CEO Musk said Tesla will “probably be ready by the end of next year” to enable autonomous peer-to-peer ride hailing services — but that regulators might not allow it at that stage. He also said that Tesla will begin publishing Autopilot performance data. (Seeking Alpha)
  • CEO Musk said Model Y R&D and CapEx will only become “significant” in 2019 and that the vehicle will be a “manufacturing revolution”, with production due to start in early 2020. The production location will apparently be somewhere other than the Freemont factory but Tesla won’t decide where until later in 2018 (but it seems to be somewhere in China — perhaps near Shanghai). (Seeking Alpha)
    • Implication: With Tesla’s own volume forecasts of Model Y outstripping the Model 3 and its manufacturing capability underwhelming, it will be an impressive feat to create and recruit for a vehicle factory to produce an all-new design in less than two years — something I’m not sure I can recall a precedent for.
  • When asked about 350 kW charging rates, Tesla indicated that in the near term, any upgrades to its facilities will be at around 200 – 250 MW, citing trade-offs between battery energy density and charging speed (whilst at the same time conceding it could design faster charging battery packs). Tesla also foresees new battery design reducing cobalt usage to “almost nothing”. (Seeking Alpha)

Toyota (history)

  • Planning a new proving ground for driverless vehicles in Michigan. (Toyota)
  • Investing C$1.4 billion, with C$100 million of government support, in its Ontario plants in order to increase production of RAV4. (CBC)

VW Group (history)

  • New CEO Deiss said VW Group is still looking at the disposal of non-core assets, name-checking Ducati, Renk and MAN Diesel and Turbo as the targets of “future perspectives”. (Reuters)
  • Reportedly working on an alliance with Didi Chuxing that would see VW run part of the fleet and develop purpose-built vehicles. (Reuters)
  • The Škoda Karoq will be assembled at the former Harmann factory in Osnabrück, Germany. Škoda officials were keen to stress that the main production source will continue to be in the Czech Republic. (Manager Magazin)
  • Bentley’s new CEO said the company needed to improve its strategy for connected, autonomous and electrified technologies and that he is revamping the cycle plan to include more electrification. He forecasts hybrid versions of the Bentayga will account for 10% of sales and the next car to get a similar treatment is “probably” the Flying Spur, with a decision to be made in the next six months. He suggested the brand would have a pure electric within the next five years. (Autocar)
  • VW publicised its new “Lydia” pick-to-voice system, an alternative to established pick-to-light error proofing. The benefits are that less physical infrastructure is necessary since the production orders are relayed by a headset and wi-fi. The computerised voice chooses cute names for parts: apple and mango replace long part numbers. (VW)
  • The US Department of Justice charged former VW CEO Martin Winterkorn over the diesel scandal. The charges involve conspiracy and wire fraud. (US Dept of Justice)
  • Said that the transition to WLTP standards in Europe was the biggest single risk to its 2018 forecast. (VW)
  • Perhaps in a deliberate stab at Tesla, Porsche detailed some of its in-process measurement techniques, noting the number of measurement points and issues such as the effect of the paint process on car body dimensions. (Porsche)
  • Porsche family scion Wolfgang Porsche said he viewed nephew Ferdinand Oliver Porsche as his likely replacement at the head of Porsche SE (large shareholder in VW Group). (Manager Magazin)

Other

  • Brabham unveiled the BT62, a £1 million track-only supercar. Production will be limited to 70 examples. (Autocar)
  • SF Motors will open a large R&D facility in Silicon Valley in Q4 2018. (Teslerati)

 

News about other companies and trends

 

Economic / Political News

  • US light vehicle industry for April was 17.07 million units, an improvement versus the prior year on a run rate basis. Year to date sales are now about flat with March and April making up for a subpar first two months. (Wards)
  • Passenger car sales in Germany of 314,055 units were 8% higher on a year-over-year basis. (KBA)
  • UK registrations of passenger cars and commercial vehicles rose in April, although on a year-to-date basis they remain down versus 2017. 167,911 new cars were sold, a year over year increase of 10.4% — partly reflecting 2 additional sales days. The local trade body was careful not to read too much into the results. (SMMT)
  • Spain had 113,816 registrations of passenger in April, a 12.3% year-over-year increase. (ANFAC)
  • Italian passenger car sales of 171,379 units were up 6.5% on the prior year. (UNRAE)
  • Rumours that the UK’s 2040 ban on combustion engine vehicles would go so far as to specify a minimum electric-only range of 50 miles provoked outrage from the OEM trade body. Government press offices refused to comment on the specifics saying all would become clear once the policy was published. (BBC)

Suppliers

  • Adient reported financial results for Q1 2018. Revenue was $4.6 billion and unadjusted EBIT was $(134) million — turning into a $252 million profit after adjustments. (Adient)
  • Aptiv reported Q1 2018 financial results and the acquisition of cable maker KUM. Adjusted operating income was $427 million on revenues of $3.6 billion. (Aptiv)
  • AAM released financial results for Q1 2018. Sales were $1.86 billion and net income was $89.4 million. (AAM)
  • Bosch invested in deep learning computer vision firm ai. (Bosch)

Ride-Hailing, Car Sharing & Rental (history)

  • Europcar acquired scooter rental firm Scooty. (Auto Rental News)
  • VW is reportedly working on an alliance with Didi Chuxing that would see VW run part of the fleet and develop purpose-built vehicles. (Reuters)

Driverless / Autonomy (history)

  • Aptiv and Lyft announced a fleet of 30 vehicles in Las Vegas, USA that will take part in a long term autonomous trial as part of a “multiyear agreement”. (Aptiv)
  • Autonomous vehicle AI provider Algolux raised $10 million, led by GM Ventures. (FINSMES)
  • A German-led study found that consumers were prepared to pay for autonomy, but not much. Only around 50% of respondents would part with more than €1,000 for the technology. The authors noted that this could be a lack of imagination on behalf of those surveyed and that technology demonstrations could change things. (Fraunhofer)
    • Implication: Although the willingness to pay might seem too low, it partially reflects the ability of customers to afford more expensive options (especially ones that they aren’t confident will work properly). With system costs likely to be in the thousands of dollars for many years, it is easier to see why autonomy is more of an immediate priority for fleets than retail customers.
  • An MIT project is working on vehicles that do not require high quality maps and instead use (relatively) rough data about the surroundings to determine its route. (IEEE Spectrum)
    • Implication: although this may seem like a less optimal approach than using detailed maps, it may serve as a useful alternative that would be a good additional to a system using multiple artificial intelligence set ups to create redundancy.

Electrification (history)

  • Daimler said it will buy batteries from CATL but declined to give volumes or name affected vehicles. (Handelsblatt)
  • Battery maker EcoFlow raised $4 million and may raise a Series B this year. (Deal Street Asia)
  • BMW is working with Sila Nanotechnologies on new battery materials that could increased battery storage capacity without needing new production lines. (Inside EVs)
  • Daimler is ceasing production of home storage batteries, saying that in future it will offer third party products more suited to stationary storage applications. Daimler intends to continue to supply used vehicle batteries for industrial storage units. (Manager Magazin)

Connectivity

  • A group of carmakers (BMW, Ford, GM and Renault) and suppliers created MOBI (Mobility Open Blockchain Initiative), to develop blockchain solutions for transactions and data management. (Press Release)
  • Aeris will provide the underpinnings for connected Mitsubishi vehicles in North America. (Telematics News)
  • Customers in the USA were surprised to find that they retained access to their vehicle months after selling them. VW says that in the terms of service, the onus is on the owner to disconnect themselves when they get rid of the vehicle, but is that enough? (The Verge)
  • GPS verification firm Regulus Cyber emerged from stealth mode with $6.3 million of funding. (TechCrunch)

Other

  • LimeBike is offering a new electric scooter, created by Segway, that boasts range of up to 35 miles. (TechCrunch)
  • Washé, a start-up offering on-demand car washing, raised $3.5 million. (TechCrunch)
  • Electric scooter and rickshaw maker Terra Motors announced $10 million in funding. (Economic Times of India)

 

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