Auto Industry Briefing — week ending 13th December 2020
Electric vehicle companies raising and spending mega-bucks; OEMs trying to drum up business for fuel cells; and thinking about the long term for ICE. Please enjoy our auto industry and mobility briefing for 7th December to 13th December 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- One Hand In My Pocket — Between them, Tesla, Nio, XPeng and Li Auto raised about the same amount in share issues as Renault is worth. Traditional OEMs will be (rightly) worried about all the cash flowing to would-be competitors. But, if making electric vehicles is so simple and mould-breaking, why do these companies need so much money to fund their product plans?
- Why — Hyundai and Toyota announced separate plans to start selling fuel cells more seriously to rivals.Putting to one side the issue of how popular the powertrain might ever become, and how capable a rival it will be to all-electric offerings, if OEMs are so happy to sell fuel cell technology to each other, why do they find it so hard to collaborate on internal combustion engines?
- How Long — Hyundai’s latest strategy update contained a commitment to go all-electric in richer countries by 2040, in line with what many of the countries themselves are already planning. On emerging markets, the firm is more circumspect, saying that it will encourage electric vehicle adoption and implying long-term demand for internal combustion engine vehicles. If traditional powertrain has another two decades or more of life, will OEMs and suppliers rediscover the joys of developing them?
News is arranged by company and topic. Stories that apply to more than one company or topic are duplicated.
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News about the major automakers
- Committed to Amazon’s cloud services for all things data-related. BMW will have 5,000 specialists trained in using Amazon’s suite of services and will develop its own proprietary data sharing software. (BMW)
- BMW’s purchasing division is committing to volumes + / – 20% with battery cell suppliers. (BMW)
- Showed off some of the small 3D printed metal parts that are used on Rolls-Royce cars to replace hard-to-make low volume castings. (BMW)
- CEO Zipse will head the European trade body, ACEA. (Europa Press)
- Sold the Hambach, France, factory to Ineos. The plant will continue to produce the Smart small car in the short term before transitioning to Ineos’s forthcoming 4×4. Daimler sounded relieved that it hasn’t had to pay too big a dowry to offload the site. (Daimler)
- Daimler’s truck division is collaborating with Linde to develop hydrogen refuelling infrastructure. (Daimler)
- Spending €350 million to develop an new platform for commercial vehicles that can integrate fully electric and conventional powertrain. (Daimler)
- Almost half of Daimler’s 2,000 parts suppliers have committed in writing to producing CO2 neutral parts within the next 20 years. (Daimler)
Ferrari
- Ferrari’s CEO suddenly stepped down for personal reasons. Whilst the company searches for a successor, chairman Elkann will take over CEO responsibilities on an interim basis. (Ferrari)
- Added an off-road derivative of the F-150 positioned below the Raptor, called Tremor. (Ford)
- Ford is experiencing launch problems with the Bronco. Journalists pointed the finger at leaky removable roofs, which suppliers located outside the USA have struggled to fix due to travel restrictions. (Detroit Free Press)
Geely (includes Volvo) (history)
- Volvo will start making electric motors at its factory in Skövde, Sweden. (Volvo)
- Kandi repudiated questions over the firm’s financial reporting raised by an investment firm. (Kandi)
- After offering buyouts to Cadillac dealers who don’t see a future for electric vehicles, GM said it won’t be doing the same thing with the GMC brand. (CNBC)
- Honda’s Swindon plant had to stop production after problems with deliveries from suppliers. (The Guardian)
- Invested in dealer ecommerce company Modal. (Modal)
- As rumoured, Hyundai has taken a majority stake in SoftBank’s robot maker Boston Dynamics. The deal will see Hyundai and its supplier affiliates owning 60% of the company, whilst Hyundai’s chairman will own 20%. (Hyundai)
- Unveiled the Genesis GV70 SUV. (Hyundai)
- Created a brand for hydrogen fuel cells called HTWO. The company implied that the name will be used for both Hyundai cars and power systems sold to third parties. (Hyundai)
- Announced a update to its future strategy that will see all “major markets” have a fully electric line-up by 2040. In markets such as India, Russia and Brazil the company will “support democratization”. From 2021 the company plans to offer remotely upgradeable vehicles, although it was unclear which features will be in scope. Despite the negative impacts of coronavirus, Hyundai is aiming for an 8% operating margin. (Hyundai)
- Recalling around 53,000 Kona, Soul and Nexo models to repair faulty brakes. (Reuters)
Subaru
- Invested in audio processing firm DSP Concepts. (DSP)
- JLR’s Castle Bromwich, UK, factory closed until Christmas, with coronavirus cited as the cause. (The Guardian)
- Announced a share issue to raise $5 billion. (Tesla)
- An internal email announcing that Model S and Model X production would take a longer than normal break over Christmas led to speculation that the models would get a refreshed design. (CNBC)
- Confirmed that it will soon launch a new all-electric SUV, to be built in Japan. (Toyota)
- There was speculation that Toyota will soon unveil a prototype electric vehicle powered by solid state batteries (which promise considerable size reductions over contemporary technology). (Nikkei)
- Launched a new European division that hopes to sell hydrogen fuel cell technology to third parties. (Toyota)
- Invested in simulation data company Parallel Domain. (FINSMES)
- Doesn’t expect to build all-electric cars in the UK until some time after 2027 (if ever), suggesting that the Corolla’s replacement will be a hybrid. (The Guardian)
- Bugatti reckons the Bollide has taken an aerodynamic leap forward by featuring retractable dimples on the engine air duct which can affect the airflow at the rear of the car depending on the speed and their position. (Bugatti)
- Suffered stoppages at the Wolfsburg, Germany, plant because a German seat foam supplier was unable to fulfil commitments after coronavirus spread through its workforce. (VW)
- Acquired majority ownership (75%) of Chinese joint venture JAC Volkswagen — an earlier announced move — and renamed the firm Volkswagen (Anhui) Automotive. VW also now owns 50% of JAC. (VW)
- VW’s Chinese joint venture with SAIC is experimenting with an agent model in China for electric vehicles, where dealers get a fixed commission for each sale. (Reuters)
- Bentley’s boss implied that the brand is planning to eventually put 150 kWh batteries in its largest vehicles to provide equivalent all-electric range with today’s combustion engine cars. (Autocar) He also said that there will be new internal combustion engine products to come before the company switches to all-electric in 2030. (Autocar)
Other
- McLaren sold a stake in its racing operations to sports investor (MSP) in a deal that values the unit at £560 million. In time, MSP could own 33% of the team (depending on performance) after putting up £185 million. (McLaren) The CEO of McLaren’s automotive unit suggested that the company turn to a special purpose entity with a view to raising £300 million – £500 million in equity. (FT)
- Nio announced a share issue that could raise around $2.5 billion. (Nio)
- XPeng raised $2.2 billion from a rights issue. (Marketwatch)
- Li Auto announced a rights issue worth around $1.5 billion. (Marketwatch)
- Arrival’s CEO believes that the company’s plan to build vehicles in small modular factories that can be located close to customers will make existing OEMs look as obsolete and incomprehensible as video tapes. (Arrival)
- Bollinger unveiled a series of design tweaks for the company’s all-electric SUV as it nears production. (Fox)
- Great Wall is reportedly preparing to launch a new electric-only brand. When asked to comment, a spokesperson summoned their inner Eric Cantona to tell reporters, “the big tide has come, we will join the game”. (Reuters)
- Rivian’s electric vehicle charging network will include units sited off the beaten track for more adventurous owners who want to charge their car and white water raft at the same time. (TechCrunch)
News about other companies and trends
Economic / Political News
- As the UK and EU struggled to agree a deal for post-Brexit trade, automakers continued to cross their fingers that everything would get sorted out at the last minute. (SMMT)
Suppliers
- Meritor’s CEO is becoming the chairman, and will be replaced by the COO. (Meritor)
Dealers
- Car leasing firm Finn.auto, which bundles carbon offsets in with the vehicle cost, raised €20 million. (TechCrunch)
- Used car website Carsome raised $30 million. (TechCrunch)
Ride-Hailing, Car Sharing & Rental (history)
- After Uber sold its self-driving business to Aurora (seemingly sent on its way with a dowry in exchange for 26% of the enlarged company), the company also sold off its air taxi business to Joby Aviation. (Business Insider)
- Uber plans to raise over $1 billion in convertible debt. (Uber)
Driverless / Autonomy (history)
- Amazon’s Zoox unveiled its autonomous robo taxi with a claimed top speed of 75 mph. (Zoox)
- Lidar developer Innoviz will list via a merger with a special purpose vehicle. (Innoviz)
- Driver monitoring start-up Eyesight rebranded as Cipia. (Cipia)
- Britishvolt’s battery factory will be built in the North of England, rather than Wales. (Britishvolt)
- Solid Power says it will have batteries with an energy density of 400 Wh / kg by 2022. (Solid Power)
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Auto Industry Briefing — week ending 6th December 2020
BMW bets on simulated racing over the real thing; Uber calls time on in-house self-driving vehicles; and Daimler is no longer as keen on start-ups. Please enjoy our auto industry and mobility briefing for 30th November to 6th December 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- Video Games — BMW is scaling back its physical motorsport activities and investing more in sim racing. Spending that would have been dismissed a few years ago as being on computer games can now reach consumers that traditional media fails to. It was only a few years ago that OEMs were piling into Formula E, is sim racing next?
- I Knew You Were Trouble — Uber sold its self-driving unit to Aurora. The immediate benefit is in offloading a cash hungry business, but it must have been a difficult decision since the company’s path to profitability seems to lie with autonomy (or drastically scaling back). Does selling up indicate that Uber believes there will be a competitive marketplace for self-driving technology, or that development is so far away it was going to go bust trying?
- Shake It Off — Daimler is selling off a majority share in its Lab1886 in-house start-up incubator. After spending years trumpeting its ability to engage with newfangled businesses, Daimler has grown tired of writing cheques and decided to concentrate on the core business. Where to now for in-house VC units?
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 will exit Formula E (the all-electric single seater championship) saying it had “essentially exhausted the opportunities for… technology transfer”. (BMW)
- As it withdraws from one category of physical motorsport, BMW says it will increase investment in, and technical support for, sim racing. (BMW)
- Mini soon plans to launch souped-up Cooper Works versions of its all-electric Mini range. (Mini)
- Significance: Many of the core attributes of electric vehicles lending themselves to a sporty driving experience: fast acceleration (thanks to instant torque); independent control of wheel speeds (if the car is dual motor); and a low centre of gravity (assuming the battery pack in the floor isn’t too much of a weight penalty). Therefore more manufacturers are likely to reposition their offerings as sports versions to drive incremental revenue.
- Daimler nominated a new chairman: ex-BMW and VW boss Bernd Pischetsrieder (who has been a board member since 2014). If shareholders approve, he will take over at the beginning of April 2021. (Daimler)
- Will start building trucks in China with existing joint venture partner Foton. (Daimler)
- Daimler is selling off most of its Lab1886 in-house VC / start-up incubator. An investment firm will take a majority stake in the business and the digital services arm will be sold to Deloitte. (Daimler)
- Agreed with German unions to create a €1 billion transformation fund. Although the press release was unclear about the exact intent, it appears to be so subsidise implementations of new technologies in German factories. (Daimler)
- CEO Källenius says that Daimler wants to insource more components, believing that Daimler can make the parts more cheaply and free up money for investment in software. (FT)
- Will pay German workers a €1,000 bonus for coping admirably with coronavirus. (Reuters)
- Creating a performance version of the Mustang Mech-E all-electric SUV. With a more powerful motor, Ford reckons the car can do 0-60 mph in 3.5 seconds. Ford doesn’t say how much the upgrade will cost and some buyers might be underwhelmed by the range compared, which drops over (20)% compared to other models in the range. (Ford)
- Said it had met its buyout goal for US salaried employees and cut a load of agency workers. (Detroit Free Press)
- Ford says that its platform strategy, which involves sharing components over a smaller number of vehicles than rivals such as VW’s MQB, but across products which are more similar in size, allows capital expenditure savings of 75% for follow-on programs. (Ford p.15)
- Significance: Unfortunately, since Ford’s presentation didn’t adjust for volume (i.e. fewer cars means less expensive tooling — although not in an exactly linear way), it isn’t clear that these savings are real on a like-for-like basis.
- Delayed the launch of Bronco by about three months, blaming problems at suppliers suffering from staff with coronavirus. (Detroit Free Press)
- Unions say that production at the Valencia engine plant is rising, indicating that demand in North America (where almost all the plant’s production goes) is picking up. (Europa Press)
Geely (includes Volvo) (history)
- Kandi saw the same investor whose report proved to be the undoing of Nikola’s founder published claims that Kandi was overstating sales. (Reuters)
- After GM gave Cadillac dealers the choice of either investing in facilities for electric vehicles or handing back their franchises, sources said about 150 sites took them up on their offer. (CNBC)
- Cadillac had to revise online adverts for its Super Cruise driving assistance system after it told consumers they could “experience autonomous driving” if they bought it. (Automotive News)
- Suffered a setback in labour negotiations with South Korean unions as members rejected a tentative deal. (Reuters)
- Dealer contracts for selling the all-electric GMC Hummer reportedly contain provisions preventing dealers from using customer leads sourced from GM’s website for any purpose other than selling the truck to them. It isn’t clear whether this is for data protection reasons, or GM is trying to muscle in on dealer’s turf. (Automotive News)
- Gave an overview of the e-GMP platform that will underpin Hyundai’s forthcoming electric models. Hyundai touted the ability of the components to charge at 800V — currently the state of the art – indicating that the firm intends to release mainstream models that can charge at rates of up to 350 kW at a time when many rivals are producing cars capped at lower speeds. (Hyundai)
- Opel announced a slightly revised brand identity, complete with a new corporate colour — neon yellow. (Opel)
- CEO de Meo warned that small cars without battery electric powertrain could soon be a thing of the past. (Autocar)
- CEO Musk says he is open to merging with a legacy auto maker, providing the terms were friendly. (TechCrunch)
- Significance: Given Musk’s criticisms of the rest of the industry in the past, and Tesla’s seeming belief that in time it will capture a market the size of Toyota and VW Group combined, the interest in becoming something other than a pure play electric vehicle company seems odd… unless you want a source of cash.
- Elon Musk implored employees to continue to cut costs, saying that if Tesla failed to meet market expectations for new products and profitability, its stock price could get crushed. (Business Insider)
- Released a new diversity report. (TechCrunch)
- Hopes that the new version of the hydrogen fuel cell powered Mirai will sell ten times as well as the outgoing model, partly because the price has dropped 20% but mostly because customers will want it more. (Toyota)
- Announced a wide-ranging series of management moves, the biggest of which sees the CEO relinquishing his brand roles, which have been handed over to the head of the Lexus brand. (Toyota)
- Like BMW, Audi is leaving the Formula E (all-electric single seater championship). It wants to enter the Dakar rally with an electric car instead. (Audi)
- Says that re-using the factory design for all-electric vehicles, the latest plant in China cost 5% less than earlier installations, more than offsetting higher site specific spending. (VW)
- Porsche is part of a group hoping to start production of synthetic fuels at a plant in Chile which will have capacity for 550 million litres per year by 2026, if everything goes according to plan. (Porsche)
- The VW brand is stopping all forms of motorsport, and will dissolve the legal entity responsible for production and preparation of racing cars. Staff will be reassigned to mainstream roles. (VW)
- Bentley says it has a retainer on five cargo jets to continue parts supply in the event of a hard Brexit. (The Guardian)
- The head of VW’s Project Artemis (a forthcoming electric car that is set to wow us all) thinks that the complexity of electric cars will force industry consolidation — taking an opposing view to start-ups who think that there is no better time to muscle in. (Reuters)
Other
- Aston Martin Chairman Stroll said that the firm will continue producing purely internal combustion engine powered cars well beyond 2030, speculating that they might make up 5% of sales mix. He said the first electric products will come out mid-decade. (FT) Aston Martin’s CEO promised to investigate how a dubiously sourced report questioning the environmental value of electric cars came to be associated with the brand. (The Guardian)
- In Nio’s latest sales report (November), the company stopped giving model line detail. (Nio)
- Aptera started taking deposits for its three wheeler all-electric car covered in solar panels. (Aptera)
- The boss of Rimac said he is nervous about the rash of listings for electric car start-ups via mergers with special purpose entities. He believes that if they are not successful, it will make investors less receptive to his plans to list at a later date. (FT)
- Dongfeng has created a $240 million investment fund with its partners. (Deal Street Asia)
- Lucid says its factory will have 400,000 units of capacity by 2028. (Lucid)
- Electric truck maker Lion Electric is going public via a merger with a special purpose vehicle in a $1.9 billion deal. The company expects to sell 6,000 vehicles over the next four years. (Northern Genesis)
News about other companies and trends
Economic / Political News
- US light vehicle SAAR of 15.55 million in November fell (9)% versus prior year. (Wards)
- German sales of 290,150 passenger cars in November fell (3.0)% on a year-over-year basis. (KBA)
- French registrations of 126,047 passenger cars in November fell (27)% versus prior year. (CCFA)
- UK passenger car sales of 113,781 units in November fell (27.4)% versus prior year. (SMMT)
- Italian passenger car sales of 138,405 units in November fell (8.3)% versus prior year. (UNRAE)
- Spanish sales of 75,708 passenger cars in November fell (18.7)% on a year-over-year basis. (ANFAC)
Suppliers
- Adient reported Q3 2020 (fiscal Q4) financial results. Revenue was $3.6 billion and EBIT was $50 million. (Adient)
Dealers
- Indonesian online service booking start-up Otoklix raised $2 million. (Deal Street Asia)
Ride-Hailing, Car Sharing & Rental (history)
- Major rental firm Europcar agreed a deal with creditors to cut its debt load. (Auto Rental News)
- Uber sold its self-driving unit to Aurora (The Verge) and is rumoured to be in talks to sell its air taxi unit. (Reuters)
- Whitelabel fleet management operator Ridecell raised $45 million from investors including Denso. (Ridecell)
- Hertz is selling its fleet management arm, Donlen, to raise cash. (Automotive Fleet)
- Grab is reportedly set to merge with regional rival Gojek. (Reuters)
Driverless / Autonomy (history)
- Scale.ai, which builds software used by autonomous developers for sensor fusion raised $155 million. (FINSMES)
- The US Postal Service delayed the decision over a massive electric vehicle fleet order until sometime in early 2021, hurting the stock market value of several companies including Workhorse. (USPS)
Connectivity
- Bosch invested in Sfara, a company that creates software that turns smartphones into diagnostics kit. (Bosch)
Other
- Electric scooter rental firm Voi raised $160 million. (Voi)
- Electric scooter rental firm Revel is scaling back. (TechCrunch)
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Auto Industry Briefing — week ending 29th November 2020
Volvo elbows out dealers; VW wastes time on internal politics; and Nissan Note is the way forward. Please enjoy our auto industry and mobility briefing for 23rd November to 29th November 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- Trashin’ The Camp — There is speculation that Volvo will completely take over distribution in Sweden. The brand has made two major moves: first, it acquired a dealer group, then it served notice on a large dealer in the country. Although several brands have experimented with an omnichannel agency model where OEMs can sell cars directly and pay dealers to handle final delivery and customer liaison, it has mostly been with a nod to traditional dealer-OEM relationships, rather than taking over retail as Tesla has. Taken together with its aspirations for the all-in leasing service “Care by Volvo”, is the Swedish brand the most innovative traditional OEM when it comes to retail?
- Another Day In Paradise — It seems that VW Group’s CEO and labour representatives are at each other’s throats again. Apparently angry that union officials are blocking promotions for his preferred candidates, CEO Diess has openly warned that efficiency gains could be lost and apparently asked for a contract extension to be confirmed far earlier than is normal to help him stamp his authority on the company. If the power play fails, he could be out. Will VW get its head in gear, or hit self-destruct?
- A Groovy kind Of Love — For a few years, Nissan has sold the Note in Japan with an optional motor as generator powertrain, in the updated model it will be all you can buy. What is motor as generator? It’s an electric car with a small battery that relies on a gasoline-powered motor to top it up. Some might call it a range extender but technically it is a bit different because the engine runs more often. Why choose that over an all-electric car? Cost. We’ve heralded motor as generator as part of the missing link in the transition to electric cars — several European vehicles from the likes of Honda, Nissan and Renault will soon offer them. How long before the technology catches on?
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
- The parent company of Brilliance, BMW’s joint venture partner in China, filed for bankruptcy. (China Economic)
- Daimler’s works council head complained that the deal with Geely to share engines, and specifically to make them in China, had been agreed without thinking about the impact on German workers. (Handelsblatt)
- In dispute with unions over the future of the Untertürkheim, Germany, plant. Daimler wants to start making parts for electric cars there as part of a plan to reduce the site’s overall size but give it a clearer future. Unions are insisting on no loss of overall activity, a move Daimler says may cause it to revisit the overall plan. (FAZ)
- Appointed a new marketing chief, poached from eBay. (Ford)
- Contemplating charging suppliers upfront for warranty problems, with the promise of handing money back if they resolve problems quickly. Ford executives believe that they’ve been giving suppliers an easy ride, suppliers wonder where in Ford’s cost estimating framework there is provision for sufficient profit to bear such shocks. (Reuters)
- Journalists putting two and two together, following Marelli’s announcement of a power electronics factory in Cologne, Germany, have concluded that Ford’s plant in the same city will build electric vehicles on the VW MEB platform. (Clean Technica)
Geely (includes Volvo) (history)
- Volvo gave notice to terminate its contract with one of the major Swedish dealer groups, prompting speculation that it could be preparing to serve its home market purely though wholly-owned dealers. (Reuters)
- Reportedly planning to apply for a US banking charter that will enable a more far-reaching automotive lending business and deposit-taking. (Reuters)
- GM is apparently offering contract buyouts of up to $500,000 to Cadillac dealers who are reluctant to embrace an all-electric future for the brand (and the six figure price tag for facility investment that comes with it. (Automotive News)
- Dropped its support for a lawsuit started by the outgoing Trump administration against California, which sought to dilute the state’s rights to set its own emissions scheme, in favour of adopting national standards. (Detroit Free Press)
- GM and Nikola finalised an agreement to share hydrogen fuel cell technology, but it is narrower in scope than the previous plan to give GM a 20% stake in return for a deeper IP sharing relationship and agreement from GM to contract manufacture the Badger pickup. (Nikola)
- Hyundai and Kia will pay US fines of $71 million for taking too long to recall faulty vehicles, with a further $73 million deferred on the assumption of good behaviour from now on. In addition to the penalties, the brands agreed to invest $56 million in safety testing facilities. (Detroit News)
Nissan and Mitsubishi (history)
- Unveiled a new version of the Note small car. Nissan will now only sell a motor-as-generator hybrid set up in Japan after the powertrain has proved to be very successful in the outgoing model. (Nikkei)
- PSA wholly-owned French dealer organisation is going to start working seven days per week, but Sundays will be exclusively for processing online orders and following-up leads from the internet. (PSA)
- German dealers are suing Opel, saying that the brand isn’t doing enough to look after their profitability. Opel said it hoped that the matter could be resolved out of court. (Autohaus)
- Announced that the Flins, France, factory will stop making cars and become a vehicle retrofitting and recycling centre. (Renault)
- The parent company of Brilliance, Reanult’s joint venture partner in China, filed for bankruptcy. (China Economic)
- Unveiled a facelift for the Jaguar XF saloon. (JLR)
- Recalling around 9,100 Model X cars because parts of the roof trim might fall down because they were glued in without the metal surfaces being properly prepared and 400 Model Y as suspension parts may detach because bolts weren’t properly tightened. (Reuters)
- A researcher managed to fool Tesla’s Model X into letting him drive it away without a key. The attack required some special hardware and a particular set of skills but highlights vulnerabilities in the security design. Tesla said it will rectify the problem ASAP. (Wired)
- Setting up an assembly line in Shanghai, China, to make charging points. (China Daily)
- CEO Musk wondered aloud about developing and building a compact car in Europe, a project he has previously wondered aloud about developing and building in China. (Reuters)
- Invested in Carbice, a company developing cooling systems using carbon nanotubes. (Toyota)
- Stopped production at the Karnataka, India, plant after a series of wildcat strikes. (Reuters)
- Truck maker Scania acquired a local Chinese brand, indicating that it will soon begin local assembly. (Reuters)
- Audi wants its factories to be CO2-neutral by 2025 but accepts that this won’t include emissions from the supply chain — particularly those involved in producing batteries. (VW)
- Trouble seems to be brewing between CEO Diess and unions again, with Diess making several remarks about the need to continue applying pressure to transform the company and seeking an early extension of his mandate (currently he is contracted until 2023) as a way of obtaining a vote of confidence from the supervisory board. The board themselves are reportedly taking their time with the decision with some citing concerns over giving him an extension that would take him beyond the normal retirement age of 65. In the meantime, several of Diess’s preferred candidates for internal promotions (such as a new CFO) have reportedly been blocked. (Handelsblatt)
- Might only sell the Passat as a station wagon in Europe to save on investment cost. (Bloomberg)
- VW’s plan for its small electric car, dubbed ID 2, reportedly led by Chinese joint venture partner JAC, is to import the vehicle from China for several years before starting a European plant. (Handelsblatt)
- VW’s product development chief says the firm is developing an MEB-Lite derivative of its platform for small cars and will have batteries with capacity of up to 45 kWh. (Autocar)
- CEO Diess said that cars with batteries that are “too large and heavy are not good” for overall emissions. He indicated that a range of about 250 miles is reasonable. He also confirmed that the company had ceased its interest in a Turkish factory. (Automotive News)
- Significance: Diess’s comment is less straightforward than it seems; owners with particularly hot or cold weather see far lower electric range than counterparts in more moderate climates.
Other
- McLaren announced the name, and some teaser shots, of its forthcoming hybrid sportscar: Artura. (McLaren)
- SAIC and Alibaba are creating a $1 billion fund to invest in smart car technologies. (The Star)
- GM and Nikola finalised an agreement to share hydrogen fuel cell technology, but it is narrower in scope than the previous plan to give GM a 20% stake in return for a deeper IP sharing relationship and agreement from GM to contract manufacture the Badger pickup. (Nikola)
News about other companies and trends
Suppliers
- Grupo Antolin reported Q3 2020 revenue of €1.1 billion and EBIT of €18 million. (Antolin)
- Widely-used data provider IHS is merging with S&P in a $44 billion deal. (Fox)
Dealers
- Indian used car website Cars24 raised $200 million. (Deal Street Asia)
Ride-Hailing, Car Sharing & Rental (history)
- Car rental start-up Envoy, which specialises in creating schemes for apartments, offices and hotels, raised $11 million and received a secured loan to buy more vehicles. (Auto Rental News)
Driverless / Autonomy (history)
- Autonomous delivery company Gatik raised $25 million. (FINSMES)
- Radar developer Lunewave raised $7 million. (Lunewave)
- Zoox’s co-founder is back with a new self-driving start-up, HYPR, and has raised $10 million. (Forbes)
- Hydrogen powertrain supplier Plug Power raised $1 billion. (FINSMES)
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Auto Industry Briefing — week ending 22nd November 2020
GM’s statement of electric car intent; a potential investment bubble for robots; and a very sensible powertrain joint venture. Please enjoy our auto industry and mobility briefing for 16th November to 22nd November 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- Tha Crossroads — GM says that by 2025, 40% of the vehicles it has on sale in the USA will be all-electric. The implication is that these will take a lower share of sales and GM is being tight-lipped on overall targets. But, if GM can be so confident about the US reception for electric vehicles, how can Ford and Fiat Chrysler be so relaxed about the outlook for their minimalist approach to the technology?
- Harder, Better, Faster, Stronger — BMW has created a unit to sell automated logistics robots that have been developed in-house. It follows on from the news that Hyundai is interested in purchasing robot maker Boston Dynamics (plus Tesla’s myriad acquisitions). Will robots be the new frontier for automotive firms to splash the cash in a desperate bid for unclear competitive advantage? In two years time will you even be able to call yourself a car company if you don’t have a robot strategy?
- I Gotta Feeling — Daimler and Geely will work together to make internal combustion engines for hybrid vehicles. They will produce them in separate factories for now but German unions were outraged at the thought that engines might be imported from China. The move makes total sense to me — powertrain consolidation is a necessary step on the path to greater electrification. Auto makers would be best to make win-win(ish) deals early rather than wait for everyone else to partner up. Will others follow Daimler and Geely’s example?
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
- Mini unveiled the Urbanaut concept. Equipped with a sliding side door and top-hinged windscreen, Mini hasn’t yet been brave enough to make an actual model of the design. (Mini)
- Announced that internal combustion engine production in Europe will be directed to only two plants in future: Hams Hall, UK, and Steyr, Austria. The Munich, Germany, plant will lose its engine manufacturing role, but get a new production line for all-electric vehicles instead. (BMW)
- Created a subsidiary called IDEALworks to sell automated logistics robots that BMW developed in-house. (BMW)
- Confirmed that the next generation Mini Countryman will be built at the Leipzig, Germany, plant. The move sends a warning to the UK government that British production of the car should not be a given in future. (BMW)
- BMW sales executives in South Africa wondered aloud whether the direct sales model the brand has piloted there should now be rolled out to other markets. BMW in the UK said it wasn’t planning any changes. (Autocar)
- Unveiled the Maybach version of the new S-Class with a rose gold and burgundy paint job that is either fetching or gauche, depending on your point of view. Hopefully customers will at least appreciate that it takes a week to convert a standard S-Class painted body to a two tone finish. (Daimler)
- Daimler and Geely will work together to design and build smaller internal combustion engines to use in hybrid electric vehicles. Engines will be produced at factories in Europe and China. Daimler appeared to warn its European workforce that should they become complacent, it might simply ship in more Chinese-produced engines. (Daimler)
- Sources said that Daimler and Renault’s cooperation would continue despite the Geely news. (Reuters)
- Daimler is reportedly hoping for hundreds of millions in annual cost savings from the engine deal. (Handelsblatt)
- PSA and FCA released the prospectus for their merger. (PSA)
- Ford wowed North American dealers with an unnamed whitespace product (rumoured to be a small pickup). (Ford)
- The much-heralded new CIO won’t be joining Ford after all, instead he will spend more time with his family. (Ford)
- Launching an online portal for selling used vehicles in the USA. (Detroit News)
Geely (includes Volvo) (history)
- Daimler and Geely will work together to design and build smaller internal combustion engines to use in hybrid electric vehicles. Engines will be produced at factories in Europe and China. (Daimler)
- Launched an insurance product that uses data from GM’s OnStar telematics suite. (GM)
- Presented an updated strategy for electric vehicles. GM now plans to have 30 all-electric models by 2025 with annual sales above the 1 million units level it previously set for 2026. By mid-decade, GM expects battery costs to have reduced by 60% from today’s levels and energy density to have doubled, so batteries from the next generation of technology will be smaller and cheaper. By 2025, 40% of GM’s North American portfolio will be electric-only; it isn’t yet clear how this translates into volumes. (GM)
- Says that the benchmark time to develop a new vehicle is now 26 months. (GM)
- Unveiled a minor refresh for the Buick GL6, which now will be equipped for V2X (vehicle to everything) communication so that the car can talk to traffic lights. (GM)
- Revealed the SUV variant of the all-electric Hummer, supposedly by mistake. (Detroit Free Press) Then (and you’re not going to believe this), they did it again. (CNBC)
- GM president Reuss said that the firm has carefully evaluated whether to spin off its electric vehicle unit, but decided against it due to “dyssynergy”, but GM will report the group’s performance separately. (CNBC)
- US regulators forced GM to recall 5.9 million vehicles to replace faulty Takata airbags, a move that the company had argued against. (Reuters)
- South Korean workers have been striking over pay. GM executives said it was “basically being held hostage” and the company’s long term future in the country was under threat. (Reuters)
- Recent withdrawals from short term car rental haven’t put off Hyundai, which is launching a new scheme for all-electric cars in Spain called VIVe. (Hyundai)
- Kia’s South Korean workers started partial strikes over wages and product allocations. (Reuters)
Nissan and Mitsubishi (history)
- Nissan denied that it was interested in selling down its stake in Mitsubishi. (Nissan)
- Rumoured to be contemplating an all-electric powertrain from full size electric pickup startup Hercules Electric to create an all-electric version of the Titan pickup. (Detroit News)
- PSA and FCA released the prospectus for their merger. (PSA)
- French unions approved Renault’s job cuts plan. (Les Echos)
- Unveiled a “concept” version of the Kiger, a small SUV / crossover aimed at emerging markets. The vehicle clearly shares many components and some exterior bodywork with the Nissan Magnite. (Renault)
Subaru
- Unveiled a new BRZ sports car. (Subaru)
- Took legal action against VW Group’s SUVs in the USA, claiming that they infringed on JLR’s terrain response system (which makes it easier to drive off-road). (Detroit News)
- Will test driver assistance and connected vehicle technologies in a new facility being built in Ireland. (JLR)
- An announcement that Tesla will join the S&P 500 index sent its shares racing. (TechCrunch)
- Invested in virus testing start-up SummerBio. (Toyota)
- Patented the concept of a drone that will refuel cars. (Futurism)
- Lamborghini and Bugatti will be run by the same person after Lamborghini’s prior CEO left to run Formula 1 and VW decided to hand the reigns back to the prior boss, who currently heads Bugatti. The announcement implied that in other respects the two brands will be independent, but there is no guarantee. (VW)
- Opened a production line for electric motors in Tianjin, China. (VW)
- Audi’s Silvercar rental brand is shutting down operations at airports and will concentrate on cars located at dealerships instead. (Auto Rental News)
- CEO Diess said VW was working on a different legal structure for Ducati and Lamborghini and would unfortunately slightly miss its 2020 European CO2 target, implying large fines. (Reuters)
- Porsche SE is calling for improved financial performance from start-ups it has invested in. (Handelsblatt)
- Porsche invested in Drivably, a developer of data analysis tools for car dealers. (Drivably)
Other
- Morgan confirmed that it will wave goodbye to the 3 Wheeler in 2021. (Morgan)
- Lordstown expressed confidence in its ability to put the Endurance pickup truck into production in 2021, saying it has 50,000 orders. (Lordstown)
- Nio reported financial results for Q3 2020. Revenue of 4.3 billion RMB (about $630 million) jumped 146% versus prior year, whilst a loss from operations of (946) million RMB (about -$140 million) improved versus prior year’s loss of more than double that amount. (Nio)
- Electric commercial vehicle company Arrival will list via a merger with a special purpose vehicle in a deal valued at $5.4 billion that will see the company receive $660 million in cash. Arrival hopes to be profitable by 2023. (Arrival)
- Aston Martin is rumoured to be supplying safety cars for Formula 1 races next year. (Autocar)
- Rivian’s CEO says the company is planning a series of smaller vehicles. (Reuters)
- Ineos might make a version of its Grenadier SUV with Hyundai’s hydrogen fuel cell technology. (Autocar)
- Alpha Motor Corporation plans to start production of a new range of electric vehicles in 2023. (Alpha)
- BYD unveiled an electric car designed for ride hailing operations. The innovations seem to consist of a sliding door and screens for the passengers. (The Verge)
News about other companies and trends
Economic / Political News
- The UK government announced an already rumoured plan to ban the sale of new gasoline and diesel cars by 2030. The scheme leaves open the door for hybrid electric vehicles to stay on sale. (SMMT)
- Passenger car sales in Europe during October of 1.02 million units fell (6.4)% versus prior year. (ACEA)
Suppliers
- Schaeffler held a capital markets day. (Schaeffler)
Dealers
- Nigerian online service booking company Autochek raised $3.4 million. (TechCrunch)
Ride-Hailing, Car Sharing & Rental (history)
- Ride Vision, a developer of driver assistance systems for motorbikes, raised $7 million. (TechCrunch)
- Senmiao Technology launched a ride service in China called Xixingtianxia. (Senmiao)
- Recent withdrawals from short term car rental haven’t put off Hyundai, which is launching a new scheme for all-electric cars in Spain called VIVe. (Hyundai)
Driverless / Autonomy (history)
- Local Motors selected Velodyne to supply lidar unit for its self-driving vehicles. (Velodyne)
- Mobility company Via will use autonomous vehicles from May Mobility. (Via)
- Mobileye will use Luminar lidar to augment its camera sensors for machine vision. (TechCrunch)
- Uber’s CEO said the company may partner with others on autonomous vehicle technology. (Reuters)
- Panasonic is collaborating with Phiar Technologies to develop better vehicle location technology. (Phiar)
- Autonomous simulation company Morai raised $1.8 million. (Morai)
- South Korean autonomous testing company Autonomous a2z raised $1.9 million. (Autonomous a2z)
- GM now plans to have 30 all-electric models by 2025 with annual sales above the 1 million units level it previously set for 2026. By mid-decade, GM expects battery costs to have reduced by 60% from today’s levels and energy density to have doubled, so batteries from the next generation of technology will be smaller and cheaper. (GM)
Connectivity
- GM unveiled a minor refresh for the Buick GL6, which now will be equipped for V2X (vehicle to everything) communication so that the car can talk to traffic lights. (GM)
Other
- Electric scooter rental company Lime says it could make a profit in 2021. (TechCrunch)
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Auto Industry Briefing — week ending 15th November 2020
Electric cars with odd names; further thinning of the self-driving herd; and auto executives need better data. Please enjoy our auto industry and mobility briefing for 9th November to 15th November 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- Strangers — BMW’s new electric SUV is called the iX, not the iNext as we were led to believe and VW promises an electric saloon called the Aero, dispensing with the “ID” label. What is going on with electric car badging? In a world where BMW has various SUVs named X1 – X7, and an iX3 electric version of the X3, what does iX mean? i10? i-forget about our other cars, they are a footnote in history now? And why are VW dropping ID, and why choose Aero, which is seems unrelated to batteries? How do they expect customers to keep track?
- I’m Outta Love — Uber is rumoured to be looking to sell its self-driving division to Aurora. It’s another nail in the coffin of the once glorious self-driving start-up scene. Let’s face it; companies have realised that this technology is fantastically expensive to develop, difficult to get right and, most importantly, that anyone who develops it will be so desperate to get their money back that they will sell to all and sundry. Without a strategic imperative to own self-driving technology, you simply don’t need as many around. Who will be next to disappear?
- The Scientist — VW executives worry that Germany isn’t building charging infrastructure fast enough to keep pace with the growth in electric vehicles. The company sees the magical ratio of one charger per ten cars being breached without a recovery plan. But isn’t it time to become a bit smarter in this debate? Raw numbers of chargers matter less than charging speeds and reliability and, given massive fleets of connected cars, surely we can be a little more accurate now than tired rules of thumb. When will OEMs be more scientific in showing where infrastructure is most valuable to customers?
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
- Unveiled the all-electric iX SUV, previously badged as the iNext. Since the car is similar in size to the X5 but is simply called iX, whilst the X3-sized model is the iX3, it isn’t clear what this means for BMW’s electric SUV naming convention. (BMW)
- CEO Zipse hopes that BMW’s collaboration will continue past 2025. (Reuters)
- Unveiled the logo for Stellantis. It is the word Stellantis with a corona behind the “a”, presumably so we never forget that is was designed in 2020. (Stellantis)
Ferrari
- Unveiled a convertible version of the SF90. (Ferrari)
- Ferrari’s CTO sees a future for V6, V8 and V12 engines and says that developing the Purosangue SUV is “another dimension” of complication because it means adopting to non-traditional customers and test procedures. (Top Gear)
- Revealed the all-electric version of the Transit van. (Ford)
- Will double capacity for the all-electric F-150 and plans to build a second product alongside the Mustang Mach E in Mexico, although Ford won’t say exactly what it will be or when it will come out. (Ford)
- CEO Farley said Ford could start making battery cells. (Reuters)
Geely (includes Volvo) (history)
- Lotus is rumoured to be working on a high-power, all-electric, SUV. (Autocar)
- Recalling 69,000 Bolt electric vehicles because their batteries are overheating, with some catching fire. (Reuters)
- Planning to hire 3,000 engineers and IT specialists between now and the early part of 2021. (GM)
- Corvette production has been hit by coronavirus-related problems with suppliers in Mexico. (Detroit News)
- Recalling 217,000 cars and SUVS because of leaking transmissions that might catch fire. (Detroit News)
- Cleared the major regulatory hurdle to be allowed to sell SAE level 3 capable vehicles in Japan. (Honda)
- Rumoured to be interested in buying the Boston Dynamics robot company. (Deal Street Asia)
Mazda
- Reported Q3 2020 financial results (Mazda’s fiscal Q2). Sales of 739 billion JPY (about $7 billion), down (16)% on a year-over-year basis. An operating loss of (7.6) billion JPY (about -$73 million) fell from a profit in the prior year. Mazda said a (12)% drop in volume was to blame. (Mazda)
Nissan and Mitsubishi (history)
- Reported financial results for Q3 2020 (Nissan’s fiscal Q2). Revenue of 1.9 trillion JPY (about $18.3 billion) fell (27)% on a year-over-year basis. An operating loss of (5) billion JPY (about -$50 million) was only a little bit worse than a modest profit in the prior year. Nissan said that massive volume drops had been almost offset by improvements in manufacturing costs and selling expense. (Nissan)
- Gave the Micra a facelift. (Nissan)
- Although PSA is reducing production at the Zaragoza, Spain, plant, the problem apparently isn’t the recently launched Opel / Vauxhall Corsa which sources say is doing very well. (Europa Press)
- Unveiled a facelift for the Kangoo small van. (Auto Express)
- Unveiled a facelift for the Discovery. (Land Rover)
- Porsche revealed a series of previously secret prototypes — seemingly to flog a book. The presence of full-size models for people-moving shuttles (building a 1:1 model is a fairly significant task) suggests the company is contemplating a future beyond sportscars. There are also several concepts aimed at creating a high performance one make racing series. (Porsche)
- Škodas will be produced outside the Czech Republic as the brand acquiesced to VW’s long-held plans to fill under-utilised factories with its products. (Škoda)
- VW Group announced its latest spending round, with a plan target of €150 billion over the next five years. VW said that half the money will be spent on electric vehicles (including hybrids) and digitalisation. Within the announcement, the company said that there will be a four door VW brand saloon called the Aero, an inexplicable departure from the ID naming convention. (VW)
- VW executives fretted that Germany’s rapidly-growing electric car fleet will soon overwhelm the available charging network. The company believes a ratio of one charger for each electric car is necessary to provide sufficient availability for customers. (Handelsblatt)
Other
- Workhorse reported Q3 2020 financial results. Sales of $564,707 led to a loss of $(10) million and a net loss of $(84) million, thanks to a whopping $(74) million interest bill. (Workhorse)
- Nikola reported Q3 2020 financial results – a $(117) million operating loss. (Nikola)
- Li Auto announced Q3 2020 sales of $363 million and an operating loss of $(27) million. (Li Auto)
- Rivian announced pricing for its all-electric truck. The near-$70,000 staring price may have many wondering how the company will be able to cheaply build electric vans for Amazon. (Rivian)
- Gordon Murray is opening a new £50 million headquarters. (Gordon Murray) The firm has apparently sold most of the 100 road-going T.50 hypercars, and about half of the track-only versions. (Autocar)
News about other companies and trends
Suppliers
- Bridgestone is selling off its US building products division. (Nikkei)
- Continental reported financial results for Q3 2020 (already pre-reported) and is now confident enough of economic recovery to issue a financial forecast. (Continental) The firm celebrated by appointing a new CEO. (Continental)
- Schaeffler reported financial results for Q3 2020. (Schaeffler)
- Meritor reported Q3 2020 (fiscal Q4) sales of $758 million and adjusted income of $11 million. (Meritor)
- Motherson reported Q3 2020 revenue of 15,012 Cr INR (about $2.0 billion) and income of 481 Cr INR (about $65 million). (Motherson)
Ride-Hailing, Car Sharing & Rental (history)
- Lyft reported Q3 2020 revenue of $500 million and an operating loss of $(453) million. The company has around $2.5 billion in cash and short term liquidity. (Lyft)
Driverless / Autonomy (history)
- Uber is rumoured to be exploring a deal to sell its self-driving vehicle unit to Aurora. (TechCrunch)
- Velodyne is aiming for a sub-$500 per unit price point for the forthcoming Velarray H800 – unit suitable for monitoring the corners of self-driving vehicles. (Velodyne)
- Autonomous delivery firm Nuro raised $500 million. (TechCrunch)
- Chinese self-driving truck company Inceptio raised $120 million. (Deal Street Asia)
Other
- Cummins and Navistar will collaborate to build hydrogen powered trucks. (Cummins)
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Auto Industry Briefing — week ending 8th November 2020
Bentley’s path to electric cars; VW’s carefully chosen words; and Nio’s upgradeable battery packs. Please enjoy our auto industry and mobility briefing for 2nd November to 8th November 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- No More Sad Songs — Bentley announced that by 2026 its entire line-up will be either all-electric or plugin hybrid and then by 2030, customers will only be able to buy battery electric models. Although for many, a decade might seem like a long time, Bentley is amongst the first to commit itself to an all-electric future. All-electric vehicle attributes: solid road-holding, excellent acceleration and quietness; seem to lend themselves well to luxury cars, and customers have the deep pockets to pay for the technology, so why are rivals so reluctant to make similar commitments?
- Confessions — VW will soon be making eight ID badged models in China, but two of them will be versions of the ID.4 crossover. Beware of auto executives bearing statistics of how many electric vehicles they plan to launch. For many of them. the naughty little secret is that they are treating saloons, estate cars and coupes as worthy of separate billing. Will the electric car revolution have as much variety as we hoped?
- Keep On Movin’ — Nio released a new, 100 kWh, battery pack. The interesting bit is that owners of older cars (who are getting by with a trifling 70m kWh) will be able to rent the larger units for a month at a time. The price isn’t cheap ($133) but it might be an attractive alternative to a full upgrade for people who only rarely need to take a longer journey. Will temporary upgrades catch on and will the infrastructure to provide the extra batteries be well enough used to justify the investment?
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
- Released Q3 2020 financial results. Revenue of €21.9 billion fell (4.6)% on a year-over-year basis. EBIT of €1.5 billion fell (2.5)%. (BMW)
- BMW’s CEO recalled the concept of E-FIRST on the earnings call saying that the next generation of platofrms will “Not be electric only, they must start electric-only”. He also said it is very important that plugin hybrid owners charge their cars and that “We want to give only hybrid cars to people who can prove that they can charge the car”. He claims that all the battery electric vehicles BMW offers are practically sold out. (Seeking Alpha)
- Following earlier news reports about potential financial problems for BMW’s Chinese partner Brilliance, CEO Zipse said that there would be no impact on the firms’ joint venture. (Seeking Alpha)
- Daimler’s CEO said the €1 billion profit target for digital services by mid-decade included selling driver assistance upgrades and that between 2025 and 2030 battery electric vehicles will start to outsell plugin hybrids. (Handelsblatt)
- Might pay €500 million more than expected to settle charges of emissions cheating with US regulators. (Reuters)
Ferrari
- Published Q3 2020 earnings. Revenue of €888 million fell (3)% versus prior year whilst EBIT of €222 million fell by about the same amount. Ferrari said the market was at the top end of its expectations. (Ferrari)
- Ferrari’s CEO doesn’t see the company reaching a 50% mix of all-electric vehicles in his lifetime. (Seeking Alpha)
- Recalling 375,000 Explorer SUVs because, following an earlier repair, parts of the steering might fall apart. (Ford)
- Has no plans to build an electric version of its largest, Super Duty, pickup trucks. (Detroit Free Press)
- Reported Q3 2020 earnings. Revenue of $35.5 billion was in line with prior year. Income of $4 billion was 74% up on a year-over-year basis and coronavirus was more than offset by reversing the effects of last year’s UAW strike. (GM)
- CEO Barra appeared to pour cold water on talks of any separation of the electric vehicle business saying “EV is a propulsion system”. She also implied that GM might have to rethink its strategy for mid-cycle actions for electric vehicles as electric powertrain and over the air connectivity gives less to change. (Seeking Alpha)
- Published financial results for Q3 2020 (fiscal Q2). Revenue of 3.6 trillion JPY (about $34.7 billion) fell (2.1)% on a year-over-year basis. Profit before tax of 345.7 billion JPY (around $3.3 billion) rose 19%. Honda said that cost reductions more than offset volume losses. (Honda)
- Restructuring its North American operations to merge manufacturing and engineering divisions. (Honda)
- Published a new environmental report for its European business. (Honda)
Nissan and Mitsubishi (history)
- Mitsubishi published Q3 2020 financial results (fiscal Q2). Net sales were 354 billion JPY (about $3.4 billion), with a net loss of (34) billion JPY (about -$320 million). The company said that its restructuring plan is over delivering, thanks to better than targeted general and administrative cost reductions. (Mitsubishi)
- Sources say that in 2020 Nissan’s sales started via the internet reached 11% of total car sales volume, up from 4% to 5% in 2019. The company is reportedly concentrating on a role out of end-to-end digital sales in North America and China and plans to involve dealers in the ordering and delivery process. (Reuters)
- Unveiled a minor refresh of the Scenic MPV. (Renault)
Subaru
- Reported Q3 (fiscal Q2) revenues of 761 billion JPY (about $7.2 billion), down (1.1)% versus prior year. Profit before tax of 47 billion JPY (about $440 million) was up strongly from only just above breakeven a year earlier. As a consequence, the forecasts were increased for full year revenue and profit (just over $1 billion). (Subaru)
- The original Land Rover Defender will seemingly live on in a range of special edition models built by the (now in-house) Bowler brand. Expect a six figure price tag. (Land Rover)
- Launched a $250 bottle of Tequila in a bottle the shape of a lightning bolt. It quickly sold out. (Tesla) Without wanting to suggest that Tesla customers are ever ripped off, the original manufacturer sells the same quantity, in its own packaging, for $45.
- Reported financial results for Q3 2020 (fiscal Q2). Revenue of 6.8 trillion JPY (about $64 billion) fell (11.3)% on a year-over-year basis. Operating income of 506 billion JPY (about $4.8 billion) was down (23)%. Toyota blamed continued drops in volume for the lost profits. The company is now more bullish about a full year outlook and lifted revenue and profit forecasts, hoping to make around $12.4 billion. (Toyota)
- Published a new environmental report. (Toyota)
- Journalists picked up on bland comments made by Toyota’s CEO about Tesla still being a relatively immature business and reported them as a major slap in the face for the Californian company. (CNBC)
- CEO Diess says that VW will hopefully make its 2020 European CO2 target, but that he can’t be certain as internal modelling shows there is a “gram or so” margin of error. (FT)
- Truck making unit Traton signed a definitive agreement to acquire Navistar. (Traton)
- Bentley announced that by 2026, the brand will only sell either fully electric or plug-in hybrid electric cars, and that by 2030 the entire range will be battery electric. The company also appears to have slightly pulled forward the launch of some of the products versus earlier announcements. (Bentley)
- VW’s China head said the company will soon be making eight “ID.” badged models in the country, but since two of them will be different variants of the ID.4, this won’t necessarily translate into completely new models. (Reuters)
Other
- Nio launched a 100 kWh battery. Owners of older vehicles, which have a 70 kWh battery, will be able to rent an upgraded unit for $133 per month. (Nio) Nio has apparently selected a site in Copenhagen, Denmark, for its first European store and hopes to sell 7,000 cars per year in Europe within two years. (China Money Network)
- Fisker’s Ocean SUV has received just under 9,000 reservations in almost 12 months. (TechCrunch)
- Creditors started bankruptcy proceedings against Spyker, saying that despite recent announcements of funding no money is forthcoming and that trademarks will be sold if the situation isn’t rectified very soon. (RTL)
- Bollinger’s CEO said that he is confident his truck will face little competition because it is a Class 3 vehicle designed to sit above products like F-150 and Cybertruck. (Yahoo)
- Li Auto is recalling almost 10,500 cars because of problems with the suspension. (Li Auto)
News about other companies and trends
Economic / Political News
- US light vehicle industry during October of 16.21 million units fell (2)% versus 2019. (Wards)
- UK October passenger car sales of 140,945 units fell (1.6)% on a year-over-year basis. (SMMT)
- 274,303 passenger cars were registered in Germany during October, (3.6)% down on prior year. (KBA)
- October French passenger car sales of 171,049 units fell (9.5)% versus prior year. (CCFA)
- Italian October passenger car registrations of 156,978 units fell (0.2)% versus 2019. (UNRAE)
- Spanish passenger vehicle registrations in October of 74,228 units fell (21)% versus prior year. (ANFAC)
Suppliers
- Veoneer appointed a new CFO. (Veoneer)
- Tenneco reported Q3 2020 revenue of $4.3 billion and EBIT of $236 million. (Tenneco)
- Modine Manufacturing reported Q3 2020 sales of $461 million and operating income of $29 million. (Modine)
- Magna reported Q3 2020 revenue of $9.1 billion and net income of $405 million. (Magna)
- Valeo reported Q3 revenue of €4.4 billion, down (6)% versus prior year. (Valeo)
- Dana acquired some of Modine Manufacturing’s cooling parts plants. (Dana)
Ride-Hailing, Car Sharing & Rental (history)
- Uber reported financial results for Q3 2020. Gross bookings and Uber’s own revenue fell (the latter by more than the former, indicating higher discounts). The net loss of $(1.1) billion was slightly improved from prior year. (Uber)
Driverless / Autonomy (history)
- Pony.ai, already backed by Toyota, raised an additional $267 million. (Reuters)
- Driver assistance developer Provizio raised $6.2 million. (FINSMES)
- Ultracapacitor developer Skeleton Technology raised €41 million. (Reuters)
Other
- Truck maker Volvo Group held a capital markets day. (Volvo)
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Auto Industry Briefing — week ending 1st November 2020
GM’s DIY electric cars; Daimler’s contingency planning; and the product mix conundrum. Please enjoy our auto industry and mobility briefing for 26th October to 1st November 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- Chasing Cars — GM will start selling electric car conversion kits alongside its existing crate engine business. Using parts from the Chevrolet Bolt, owners will be able to re-build their pride and joy with electric motors and batteries, rather than roaring V8s. Pricing isn’t yet announced, but if it is reasonable, will electric car startups use anything else to build their prototypes?
- United States of Whatever — Daimler Trucks announced a deal with Waymo for self-driving trucks, then a couple of days later there was a tie-up with lidar developer Luminar. We’ve seen companies with multiple, seemingly competing, initiatives before but not within the week. So what does it mean? Simply that Daimler Trucks is being smart: Since no one has self-driving sorted out, why back only one team? More to the point, who says you can have safe self-driving with only one artificial intelligence on-board. Is the plan to build redundancy by running both side-by-side?
- L.I.F.E.G.O.E.S.O.N. — FCA announced consensus-busting results, Ford’s profits were great, VW Group had a barnstorming quarter. The common thread? Executives reckon that their product mix has gone great guns, more than offsetting the volume losses from coronavirus. Now that manufacturers have discovered that building fewer of their least profitable products, whilst concentrating on maximising production of the highest-earners, will they change their attitude to production planning, or revert to type once this is all over?
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’s joint venture partner, Brilliance, failed to repay a $150 million bond. BMW may find the company to be a willing seller of more of the joint venture (or it could cling on even more tightly!). (Reuters)
- Mini announced a forthcoming portfolio expansion that will see further products get all-electric versions, along with a new model that will only be available as a battery electric car. (Mini)
- Daimler has signed an updated supply agreement that will give Aston Martin access to a wider range of parts from the Mercedes-Benz parts bin. In return, Daimler will get enough shares in Aston Martin to increase its stake to 20%, or £286 million — whichever is lower — by 2023, subject to certain performance criteria being met. The implication is also that Aston Martin will pay less for the parts from now on. Daimler stressed that it has no interest in increasing its shareholding beyond 20% (Daimler)
- Daimler Trucks’ Torc self-driving division will develop products that use Luminar’s lidar. Daimler has taken a stake in the lidar firm as part of the deal. (Daimler)
- Despite its in-house Torc Robotics self-driving division, Daimler Trucks is collaborating with Waymo to develop autonomous trucks. (Daimler)
- Acquired Korean rental company Star-Rent-A-Car. (Daimler)
- Daimler and Volvo Group officially signed off on their fuel cell joint venture. (Daimler)
- Reported Q3 2020 financial results. Revenue of €25.8 billion fell (6)% from prior year whilst net profit of €1.2 billion was strongly improved from Q3 2020. Adjusted EBIT of €2.3 billion was more than explained by North America, which delivered adjusted EBIT of €2.5 billion. (FCA)
- CEO Manley all but confirmed that there will soon be an all-electric version of the Ram pick-up, asking analysts to “stay tuned” for details. (Seeking Alpha)
- FCA and PSA’s boards signed some of the merger paperwork and confirmed that they expect the merger to be complete by the end of Q1 2021. (FCA)
- Honda is joining FCA’s European CO2 pool. (EU)
- Reported financial results for Q3 2020. Revenue of $37.5 billion rose 1% versus prior year. Net income of $2.4 billion strongly improved versus a $0.4 billion profit in Q3 2020. Automotive EBIT of $2.6 billion was entirely explained by North America earnings of $3.2 billion, Europe lost $(400) million. (Ford)
- Buying 2020 European CO2 target relief from Volvo. (Volvo)
- Sold the Sao Bernardo do Campo, Brazil, site. (Reuters)
- Intends to sell 100,000 vehicles equipped with the new driver assistance suite that enables hands-off, but not eyes-off, motoring in 2021. Initially, customers will only get the hardware and will have to wait for a software upload later in the year before everything actually works. The cars will only work on 100,000 miles of specially analysed sections of road. (Ford)
- Hired a new IT and software chief from the banking industry. Ford played up his ex-Fordie credentials. (Ford)
- New CEO Farley admitted that “flexibility between battery electric [and] plugin [hybrids] is not very high”. (Ford)
- Ford plans to hold a capital markets day in the spring. On the earnings call, Ford executives studiously batted away all detailed questions, leaving analysts to wonder aloud what had happened to a promise of greater transparency. (Ford)
Geely (includes Volvo) (history)
- Polestar issued another recall for the Polestar 2 to replace faulty power electronics and cooling systems. (Polestar)
- Kandi Technologies created a ride hailing company, Zhejiang Ruiheng Technology Company, as a joint venture with two other partners. Kandi will own 10% of the business. (Kandi)
- Volvo will beat its 2020 European CO2 target, meaning that it can sell the benefit of the surplus to Ford. (Volvo)
- ECARX, a technology developer founded by Geely, raised $194 million. (Deal Street Asia)
- Kandi Technologies is listing its battery swapping subsidiary. (Kandi)
- Announced a new CFO, Paul Jacobson, recruited from Delta Air Lines. (GM)
- Will start selling electric car conversion kits in 2021, aimed at classic GM models and based on the Chevrolet Bolt parts bin. (GM)
- Produced 1.286 million vehicles in Q3 2020, up 1% on a year-over-year basis. (Honda)
- Honda is joining FCA’s European CO2 pool. (EU)
- Announced Q3 2020 financial results. Revenue of 27.6 trillion KRW (about $24.3 billion) rose 2.3% on a year-over-year basis. A loss before tax of (362) billion KRW (about -$320 million) fell from a loss in the prior year. (Hyundai)
Mazda
- Produced 327,485 cars in Q3 2020, down (11)% on a year-over-year basis. (Mazda)
- Reported Q3 2020 automotive revenue of €12 billion, up 1.2% on a year-over-year basis. Unit sales were down, but product mix more than compensated. (PSA)
- PSA sold down 7% of its Faurecia stake sell down, taking the company to 39%. Once PSA merges with FCA, the plan is to distribute the remaining shares to the new entity’s stockholders. (PSA)
- FCA and PSA’s boards signed some of the merger paperwork and confirmed that they expect the merger to be complete by the end of Q1 2021. (FCA)
- The Citroën brand is resetting its UK prices, revising them sharply downwards, in a bid to reflect transactional amounts and get away from heavy discounting. Sales to rental companies will also be cut. (Autocar)
Subaru
- Sold 261,651 vehicles in Q3 2020, up 11% on a year-over-year basis. (Subaru)
- Reported financial results for Q3 2020 (Tata’s fiscal Q2). Revenue of 52,530 Cr. INR (about $7.2 billion) fell (18.2)% versus prior year, of which JLR’s revenue was £4.35 billion, down (28.5)%. There was a loss before tax of (815) Cr. INR (about -$110 million), with JLR’s £65 million failing to offset the wider group. (Tata)
- Unveiled a facelift for the Jaguar E-Pace. The car’s seats incorporate a Jaguar tag, a design detail seemingly taken from JLR’s former stablemate Volvo (it’s even in nearly the same place). (JLR)
- Sold 2.52 million vehicles in Q3 2020, down (8)% versus prior year, although September was up on a year-over-year basis. (Toyota)
- Expanded a recall for faulty fuel pumps — 5.84 million cars will now have replacement parts fitted. (Reuters)
- Slightly increased its shareholding in KDDI Corporation, a mobile phone network and the carrier for Toyota’s telematics network in Japan via an investment of around $500 million. (Toyota)
- Invested in Spanish car subscription startup Bipi. (Toyota)
- The Hino truckmaking division agreed a joint venture for electric vehicles with VW’s Traton, building on an existing collaboration. (Traton)
- Starting an investment fund focused on manufacturing technology. Toyota won’t say how large the investment will be until early December. (Toyota)
- Sold 2.6 million vehicles in Q3 2020, down (1)% on a year-over-year basis. (VW)
- Reported financial results for Q3 2020. Revenue of €59.4 billion fell (3)% versus prior year. Profits of €3.2 billion fell (30)% versus Q3 2019. (VW)
- Ducati published financial results on a major newswire — possibly part of a plan to raise the brand’s profile within the investment community as part of a rumoured sale. (Ducati)
- The Traton truckmaking division agreed a joint venture for electric vehicles with Toyota’s Hino, building on an existing collaboration. (Traton)
- Bugatti unveiled the Bolide, a track-only hypercar. The company says it hasn’t yet decided whether or not to put the car into series production. (Bugatti)
Other
- Aston Martin signed an updated supply agreement that will provide access to a wider range of parts from the Mercedes-Benz parts bin. In return, Daimler will get enough shares in Aston Martin to increase its stake to 20%, or £286 million — whichever is lower — by 2023, subject to certain performance criteria being met. The implication is also that Aston Martin will pay less for the parts from now on. Daimler stressed that it has no interest in increasing its shareholding beyond 20% (Daimler) Aston Martin is raising $1 billion in debt, and looks set to incur an interest rate of over 10%. (Reuters)
- Berkley Coachworks announced a limited edition two seat roadster, which the firm hopes to start producing in 2021. (BBC)
News about other companies and trends
Economic / Political News
- By 2035, 50% of new cars sold in China will have to be fuel cell, plugin hybrid or battery electric. The remainder must be full hybrids, capable of at least some electric-only range. (Nikkei)
Suppliers
- Stoneridge reported Q3 2020 sales of $176 million and operating income of $8 million. (Stoneridge)
- Lear reported Q3 2020 revenue of $4.9 billion and net income of $174 million. (Lear)
- Nidec’s Q3 2020 sales were 414 trillion JPY (about $4 billion), with operating profit of 41 billion JPY (about $400 million). (Nidec)
- Visteon reported Q3 2020 sales of $747 million and net income of $6 million. (Visteon)
- Kongsberg reported Q3 2020 revenue of €255 million and EBIT of €14 million. (Kongsberg)
- Grammer reported Q3 2020 revenue of €462 million and operating EBIT of €22 million. (Grammer)
- AAM reported Q3 2020 revenue of $1.4 billion and net income of $117 million. (AAM)
- BorgWarner reported Q3 2020 sales of $2.5 billion and operating income of $284 million. (BorgWarner)
- Gestamp reported Q3 2020 revenue of €2.1 billion and EBIT of €94 million. (Gestamp)
- Goodyear’s Q3 2020 sales were $3.5 billion, with a net loss of $(2) million. (Goodyear)
- Aptiv’s Q3 2020 sales were $3.7 billion, operating income was $364 million. (Aptiv)
- Valmet says car demand is so high that it urgently needs 400 new staff for its Finnish plant, indicating that it wants to add a shift. (Valmet)
- Continental’s CEO is stepping down. (Continental)
- Continental took a minority stake in lidar developer AEye. (AEye)
- Dana announced an investment in electronic controls company Pi Innovo. (Dana)
- Shiloh reached a deal to sell itself and emerge from bankruptcy protection. (Shiloh)
- PSA sold down 7% of its Faurecia stake sell down, taking the company to 39%. Once PSA merges with FCA, the plan is to distribute the remaining shares to the new entity’s stockholders. (PSA)
Dealers
- Malaysian car sales website iCar Asia has received a $150 million takeover offer. (Deal Street Asia)
- Toyota invested in Spanish car subscription startup Bipi. (Toyota)
Driverless / Autonomy (history)
- Waymo released a new safety report, made up of the usual PR-speak about how the company was developing autonomous cars. In addition, the company published safety statistics showing a series of actual crashes and near misses avoided by the intervention of the safety driver. There was a single accident in a completely driverless vehicle and one 50:50 where there was an airbag deployment. In all other situations either the Waymo vehicle was not at fault, or the avoiding actions of the safety driver prevented a collision. (Waymo)
- Autonomous vehicle simulation company Applied Intuition raised $125 million. (Applied Intuition)
- Lidar supplier Aeva is going public via a merger with a special purpose vehicle. (Aeva)
- Daimler Trucks’ Torc self-driving division will develop products that use Luminar’s lidar. Daimler has taken a stake in the lidar firm as part of the deal. (Daimler) At almost exactly the same time, Daimler Trucks announced a collaboration with Waymo to develop autonomous trucks, seemingly separate from the first initiative. (Daimler)
- Continental took a minority stake in lidar developer AEye. (AEye)
Connectivity
- ECARX, a technology developer founded by Geely, raised $194 million in a round valuing it at $1.5 billion. Investors included Baidu. (Deal Street Asia)
Other
- Triton EV showed off a hydrogen powered heavy truck. The firm said it had brushed aside the counsel of experts who told them it was a five year, $100 million+ effort and built the vehicle in 35 days. If the company had listened more carefully it might have discovered that this was timeline and cost to industrialise a design. (Triton)
- Volvo Group and Isuzu finalised the terms of their strategic alliance. (Volvo Group)
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Ford partners with Volvo to reduce CO2 fleet emissions
Interesting news from the European union today that Ford will use Volvo’s fleet CO2 performance to offset overruns, caused primarily by problems with the Kuga plugin hybrid (PHEV).
They’ve formed a collective CO2 emissions pool to do so. A few weeks ago, Ford announced that it was looking for partners to work in this way.
The bureaucratic term for it is “Declarations of intent to form Open Pools pursuant to Article 6(5)of Regulation (EU) 2019/631(passenger cars)”
The move begs three questions:
- Is this all the help Ford needs?
- How much are they paying?
- Have Renault missed an opportunity to capitalise on their over-achievement in CO2 reductions?
You can find the source document here:
Auto Industry Briefing — week ending 25th October 2020
The internet marches on; Musk banishes the skateboard to oblivion; and questions over price parity. Please enjoy our auto industry and mobility briefing for 19th October to 25th October 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- I’ll Be Right Here Waiting For You — FCA says online shopping for cars has taken off like a rocket. In 2019, FCA says 25% of sales started on the internet. Twelve months later, the equivalent figure is reckoned to be 45%. Many brands have advanced visions of internet sales but failed to deliver them in practice. How much longer can they afford to wait?
- Skater Girl — Elon Musk says skateboard chassis for battery electric vehicles will be “obsolete long term” because the benefits of optimising the battery for the specific vehicle body are too great to ignore. Tesla walked away from the skateboard some time ago (although repeated pictures of the same Model S chassis in a Tesla showroom mislabelled as a later vehicle have fooled many). But hearing Mr Musk say it out loud somehow matters more. What now for companies that have raised billions on the back of the skateboard technology?
- Don’t Worry Be Happy — VW CEO Diess says that by 2026, battery electric vehicles will be more economically effective than conventionally powered alternatives. Great news, but is that because they will become so cheap, or because internal combustion engines are getting more expensive? If the latter, then how can increasing car prices be consistent with ever growing industry volumes — unless price elasticity doesn’t exist anymore, or car makers plan to lower their margins?
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
- Released interim financial results for Q3 2020, saying that automotive free cashflow of €3 billion had vastly outstripped market expectations, but staying quiet on everything else. (BMW)
- BMW and Daimler’s mobility joint venture sold the Moovel multimodal app (they get a stake in the Deutsche Bahn subsidiary that took it over) (Daimler) and is reportedly considering a €1 billion offer from Uber for the FreeNow ride hailing division. Daimler is apparently more keen to sell than Daimler. (Manager Magazin)
- Reported Q3 2020 financial results. Revenue of €40.3 billion fell (7)% year-over-year whilst EBIT of €3.1 billion rose 14% versus prior year. Daimler said that cost cuts had more than offset volume and pricing losses. (Daimler)
- Daimler’s CFO dropped hints about a forthcoming all-electric Mercedes sports car. (Bloomberg)
- BMW and Daimler’s mobility joint venture sold the Moovel multimodal app (they get a stake in the Deutsche Bahn subsidiary that took it over) (Daimler) and is reportedly considering a €1 billion offer from Uber for the FreeNow ride hailing division. Daimler is apparently more keen to sell than Daimler. (Manager Magazin)
- FCA says that the importance of online shopping for cars is growing rapidly. The company reckons that in 2019 about 25% of monthly sales came from a lead generated through browsing the internet. This year it is 45%. The company reckons that improving its website, and the variety of services that could be booked on it, increased internet traffic by 65%. (FCA)
- CEO Manley said European politicians needed to stump up more cash to help the automotive industry transition to electric vehicles. (Detroit News)
- Ford’s launch autonomous vehicle will be a variant of the Escape hybrid (the Kuga in Europe). The company showed photographs of what it calls a “launch intent” model, but admitted that since self-driving doesn’t yet work, they can’t be sure. The car has two types of lidar sensor: a long range 128 line model and a series of shorter range units, augmented with “high resolution” (actual resolution not stated) cameras. Ford said it has added battery capacity over the retail product to better power the vehicle’s computing system but implied that it is not a plug-in version (although one is available) and no charging port is visible in the promotional video. (Ford)
Geely (includes Volvo) (history)
- Geely’s Emgrand brand (sold only in China) has reached 3 million unit sales. (Geely)
- Announced a $2 billion investment in the Spring Hill, USA, plant — plus smaller amounts in some other locations — to convert the facility over to make electric cars including the Cadillac Lyriq. (GM)
- Significance: The sums involved, for an existing plant with around 250,000 units per annum capacity, show that manufacturers are currently spending far more on electric vehicle programs than for conventionally powered models, despite promises that all-electric vehicles would lead to simplification and reductions in investment. Since the Cadillac Lyriq is a 2nd generation BEV, it seems we will be waiting until at least the third generation for GM’s spending to reduce.
- Says that 1 million US customers are paying for in-vehicle wi-fi, six years after the service launched. Unsurprisingly, vehicles that commonly carry passengers (i.e. big SUVs full of children) are the biggest source of demand. (GM)
- GM’s Cruise self-driving unit has been assessing the impact of coronavirus on the design of its Origin robotaxi. Eschewing the latest technologies for virus control, in particular UV light and cabin heating, the bran’s engineers reckon the way forward is a giant Perspex screen to separate passengers. (GM)
- Unveiled the long-awaited Hummer all-electric SUV. The car will boast extreme off-road capabilities and a massive price tag. Initial vehicles will be over $110,000 and although a version retailing at a mere $80,000 is planned, it won’t be available until two years after launch. (GM) The company quickly sold out of the launch version. (Reuters)
- GM’s president Reuss said negotiations with Nikola were “going forward”. (Detroit News)
- Hyundai and Kia said that profits would be hit by a $(2.9) billion provision for engine quality issues. (Reuters)
- Faurecia reported Q3 2020 revenues of €3.874 billion, down (7.4)% versus prior year. (Faurecia)
- Renault reported Q3 2020 revenues of €10.374 billion, down (8.2)% versus prior year. The company blamed exchange and sales to partners for most of the drop and said September figures showed that a recovery was underway. (Renault)
- Reporting healthy sales mixes for plugin hybrid vehicles in Europe. For September in France, Captur was 18% PHEV and Megane was 31%. (Renault presentation p. 8)
- Highlighting the level of testing required to confirm that technologies conform to automotive grade expectations, JLR announced that it is taking two years to assess a new range of composites and metals that are in consideration as materials for bodies in future range of vehicles. (JLR)
- Reported Q3 2020 financial results. Automotive revenue of $7.6 billion rose 42% versus prior year. Net income of $331 million rose 131%. For the second consecutive quarter, Tesla’s customer deposits number dropped. (Tesla)
- Regulators in China told Tesla to recall around 30,000 Model S and Model X cars because their suspension can fracture if it runs over large objects. (Bloomberg)
- Purchased a small manufacturing engineering company in Germany. (Manager Magazin)
- Released an updated self-driving software program to a limited set of drivers. Those trialling the system thought it was fantastic that their vehicles drove the entire route by itself. Tesla’s perilous warnings that the cars could make sudden dangerous manoeuvres at any time suggested a complete version could be some way away. (Electrek)
- Tesla’s earnings release included a summary page of the improvements targeted during the battery day presentation (for those who weren’t dedicated enough to take repeated screenshots of the YouTube video. (Tesla p. 12)
- CEO Musk said that even if lidar were free he wouldn’t use it in driver assistance. He also believes that Tesla is an “order of magnitude more vertically integrated than other car companies” (it isn’t). Musk also said that “skateboard” battery electric vehicle chassis will be “obsolete long term”. (Seeking Alpha)
- Invested in robot kitchen start-up YPC Technologies. (Toyota)
- Porsche’s announcement about some new Panamera plugin hybrid offerings highlighted an interesting new trend: manufacturers have started talking about electric only ranges under the WLTP city cycle, rather than the full combined cycle (where range is worse, primarily due to higher speeds and less regenerative braking). (Porsche)
- Reportedly considering a restructuring of the reporting responsibility for Bentley which would see it fall under Audi’s purview. (Handelsblatt)
- CEO Diess says that electric cars will be cheaper than internal combustion engine ones by 2026. (Handelsblatt)
- Reportedly shopping the Ducati brand around to gauge interest. (Reuters)
- Bentley’s boss says a no-deal Brexit will reduce profits by (25)%. (Reuters)
Other
- Arrival published a blog post detailing the company’s approach to building low cost vehicle bodies (using moulded panels that have the finished colour and surface treatment built-in). Arrival believes that by developing some of the raw materials itself, and taking a rapid prototyping approach to tooling development, it will be able to optimise the panels better than peers (who typically struggle with surface finish and weight issues). (Arrival)
- Despite recent financial problems, Sono Motors is still up and running and hope to launch their solar power augmented car in 2022. (Sono Motors)
- Laureti revealed plans for a mobility ecosystem that will deploy the firm’s own brand vehicles, combined with software, to offer mobility as a service. (Laureti) Full disclosure: Ad Punctum has been involved in Laureti’s strategy and product development on a secondment basis.
- Byton’s CEO left the troubled company abruptly. (Manager Magazin)
- GM’s president Reuss said negotiations with Nikola were “going forward”. (Detroit News)
News about other companies and trends
Suppliers
- Magna announced a new CEO. Current CTO Kotagiri will take over on 1st January 2021. (Magna)
- Autoliv reported Q3 revenues of $2.0 billion and operating income of $175 million. (Autoliv)
- Troubled supplier Arlington sold UK arm Magal Cables to Remsons Industries. (Economic Times of India)
- LG Chem said battery sales were on the up and it plans to triple capacity. (Reuters)
- Michelin announced Q3 2020 revenues of €5.5 billion, down (10)% year-over-year. (Michelin)
- Mahle is buying Keihin’s air conditioning unit. (Mahle)
- Continental reported initial Q3 2020 earnings. Revenues were €10.3 billion, free cash was €1.8 billion. (Continental)
- Veoneer reported Q3 2020 sales of $371 million and a $(103) million operating loss. (Veoneer)
- Faurecia reported Q3 2020 revenues of €3.874 billion, down (7.4)% versus prior year. (Faurecia)
Dealers
- Cloud-based retail software provider Tekion raised $150 million with investment from Exor. BMW, GM and the Renault-Nissan-Mitsubishi alliance are existing investors. (FINSMES)
Ride-Hailing, Car Sharing & Rental (history)
- Ride hailing firm Shouqi Yueche raised a nine figure sum in a series C round. (Deal Street Asia)
- BMW and Daimler’s mobility joint venture sold the Moovel multimodal app and is reportedly considering a €1 billion offer from Uber for its ride hailing division, with Daimler more keen to sell than BMW. (Manager Magazin)
Driverless / Autonomy (history)
- Thermal imaging camera developer Adasky raised $15 million. (Adasky)
- Nvidia claims that its latest AI chips have made step changes in performance over rivals. (Nvidia)
- Velodyne attacked the performance of emergency braking systems that rely on cameras in low light conditions and called for additional tests to be added that would show lidar’s superior performance. (Velodyne)
- Ford’s launch autonomous vehicle will be a variant of the Escape hybrid (the Kuga in Europe). The company showed photographs of what it calls a “launch intent” model, but admitted that since self-driving doesn’t yet work, they can’t be sure. The car has two types of lidar sensor: a long range 128 line model and a series of shorter range units, augmented with “high resolution” (actual resolution not stated) cameras. Ford said it has added battery capacity over the retail product to better power the vehicle’s computing system but implied that it is not a plug-in version (although one is available) and no charging port is visible in the promotional video. (Ford)
- GM’s Cruise self-driving unit has been assessing the impact of coronavirus on the design of its Origin robotaxi. Eschewing the latest technologies for virus control, in particular UV light and cabin heating, the bran’s engineers reckon the way forward is a giant Perspex screen to separate passengers. (GM)
- Tesla released an updated self-driving software program to a limited set of drivers. Those trialling the system thought it was fantastic that their vehicles drove the entire route by itself. Tesla’s perilous warnings that the cars could make sudden dangerous manoeuvres at any time suggested a complete version could be some way away. (Electrek)
- Tesla CEO Musk said that even if lidar were free he wouldn’t use it in driver assistance. (Seeking Alpha)
- Charging network EV Charge raised $15 million. (EV Charge)
- Romeo Power says it has a 1 MWh heavy vehicle battery pack available to serve the commercial vehicle market. Even at the most bullish end of price forecasts, such a unit would cost more than $80,000. (Romeo Power)
- Electronic components firm VisIC Technologies raised an unspecified amount in a series E round. (VisIC)
- VW CEO Diess says that electric cars will be cheaper than internal combustion engine ones by 2026. (Handelsblatt)
- Tesla CEO Musk said “skateboard” battery electric vehicle chassis will be “obsolete long term”. (Seeking Alpha)
Other
- A new race series for production-based electric cars hope to launch in 2022. Seemingly inspired by the 1990’s video game Super Off Road (familiar to many Sega and Nintendo owners), the short course races will sprint over a few laps and include jumps, obstacles and water splashes. (SuperCharge)
- E-bike rental subscription service Dance raised $18 million. (TechCrunch)
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Auto Industry Briefing — week ending 18th October 2020
Fisker’s new groove; Foxconn’s bid for greatness; and Ford’s CO2 miss. Please enjoy our auto industry and mobility briefing for 12th October to 18th October 2020. A PDF version can be found here.
Before you read the detail, what were my favourite stories of the past week…?
- We Belong Together — Fisker switched horses for the Ocean SUV’s platform, jumping from VW’s technology to Magna’s. Both companies say that the timing for production is unchanged and new cars will be on the road in two years, which seems a bit curious. How can you change the technology set and not change timing unless: (a) the vehicle hasn’t actually been engineered yet, so changing assumptions doesn’t matter, or (b) the contribution of the donor architecture is minimal, so switching it out is easy, in which case why refer to it in so many investor presentations?
- Open Arms — Foxconn showed off its new architecture for electric vehicles. The company hopes that various car makers will use it rather than creating their own underpinnings. But are Foxconn the right people to do this? And how can they convince others of the engineering merits if they aren’t making their own complete vehicle?
- Anytime You Need A Friend —Ford said that it will fail to meet its 2020 target for European CO2 emissions. To avoid fines, the company plans to agree a deal with an unnamed rival to offset the underperformance. How did Ford get here? Unfortunately, the company pursued a strategy focused on compliance rather than an optimistic view of how quickly customers would adopt to zero emission travel. There are only two plugin hybrids in the European range (and only one in some markets) and a yet-to-arrive all-electric SUV. Doing the bare minimum seemed okay until the company had to recall plugin Kugas and stop sale of new units. Is that an unforced error or a consequence of being too clever?
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
- Created a scheme for owners of plug-in hybrid vehicles to encourage charging: for each kilometre driven in all-electric mode, drivers will get a credit towards free charging. In certain areas, the award doubles. The program will initially be available in Germany, Belgium and the Netherlands. (BMW)
- Will not use VDL’s Nedcar plant, which builds Mini and BMW X1 on a contract basis, after 2023. (Dutch News)
- Published a series of principles for the application of artificial intelligence within BMW. Viewers of the Terminator films will be familiar with the background to many of them. (BMW)
- Daimler and BMWs mobility joint venture is reportedly looking to offload its parking unit. (Bloomberg)
- Reported preliminary financial results (because they were better than the market was expecting). Group EBIT was €3.071 billion and cars and vans EBIT was €1.782 billion. On an adjusted basis, cars and vans EBIT of €2.1 billion represented a 9.4% margin on sales. Industrial free cash flow was €5.139 billion. (Daimler)
- Launched an insurance joint venture with Swiss Re, called Movinx. (Daimler)
- Daimler and BMWs mobility joint venture is reportedly looking to offload its parking unit. (Bloomberg)
- Reached a tentative contract agreement with Canadian unions, but declined to reveal the terms. (FCA) Unions said FCA had agreed to invest up to $1.5 billion in its primary Canadian factory to build electric cars. (Reuters)
- Admitted that because of problems with the Kuga PHEV, it will have to pool emissions with a rival group to meet 2020 EU CO2 targets and avoid fines. It isn’t clear how much the pooling agreement will cost, or who Ford will pool with although Renault remains a possibility. (FT)
- Reckons that moving to an electronic manual for the F-150, stored within the infotainment system, saves 290 tons of paper each year (not to mention hundreds of thousands of dollars). (Ford)
- Sold 164,532 vehicles in China during Q3 2020, up 25.4% on a year-over-year basis. (Ford)
- Sold 299,632 vehicles in Europe during Q3 2020, a drop of (4.2)% versus prior year. (Ford)
- Recalling over 5,000 vehicles to replace faulty engine and vehicle computers that affect engine cooling, tyre pressure monitoring and control of the daytime running lights. (Ford)
- Because of continued problems with the Kuga PHEV in Europe, Ford is delaying the launch of the Escape PHEV (the same vehicle) in North America. (Europa Press)
Geely (includes Volvo) (history)
- Volvo’s self-driving unit, formed through the dissolution of the Zenuity joint venture previously owned with Veoneer, will be called Zenseact. (Volvo)
- Taking a leaf out of Tesla’s PR playbook, GM announced that the Detroit-Hamtramck, USA, factory will need a new name to signify that the future is now and everyone needs to forget about everything they ever though they knew about car building. From now on, the plant will be called Factory ZERO. (GM)
- GM’s Chinese sales of 771,440 vehicles in Q3 2020 rose 12% on a year-over-year basis. (GM)
- GM’s Cruise self-driving unit will soon start testing in San Francisco without safety drivers. (Cruise)
- Successfully completed the tender offer of portfolio companies Keihin, Nissin Kogyo and Showa, enabling a merger of the three units with Hitachi Automotive. (Honda)
- Hyundai family scion Euisun Chung became the firm’s new chairman. (Hyundai)
- Hyundai’s new Singapore plant will have a Fiat Lingotto-esque test track on the roof. (ET)
Nissan and Mitsubishi (history)
- Mitsubishi unveiled a facelift for the Eclipse Cross. (Mitsubishi)
- Nissan’s US finance company will pay $4 million in fines for improperly repossessing vehicles. (Reuters)
- Sold 588,576 vehicles in Q3 2020, down (13)% on a year-over-year basis. (PSA)
- Sold 806,700 vehicles in Q3 2020, down (6)% on a year-over-year basis. (Renault)
- Held an electric vehicle event called Renault EWays. The firm said that by 2050 all vehicles sold in Europe will be zero emission. If recent political promises are followed through, Renault may find the aspiration has to be brought forward. A “concept” battery electric Mégane was also on display. Renault says a production version will go on sale in 2021. (Renault)
- Unveiled a minor refresh of the Twingo city car, and an all-electric version. (Renault)
- Lost a legal case against Borgward. A judge ruled that Borgward’s logo was sufficiently different from Renault’s tha there was no trademark infringement. (Borgward)
- Drew some of the state backed €5 billion loan because it was due to expire at the end of the year and the CFO felt it would have been a shame not to use it. (Reuters)
- Sold off the Marcel ride hailing business. (Les Echos)
Subaru
- The head of Subaru’s US unit reckons industry volumes will take three years to return to 17 million units. (Reuters)
- Construction at the Berlin factory was halted because Tesla hasn’t paid its water bills and the utility gladly explained that it would get the same treatment as everyone else who falls into arrears. (Manager Magazin)
- CEO Musk said that there would be a “beta” release of full self-driving next week. (Twitter)
- Toyota Tsusho invested in Data Integrated (DIL) a Kenyan firm that aggregates informal bus operators. (Toyota)
- Recalling around 3,100 Highlander vehicles in the USA because incorrectly fitted seat fabric could stop airbags from working properly. (Toyota)
- Local Motors raised $15 million from the VC fund that includes Toyota as one of its main backers. (Local Motors)
- Porsche has upped its sustainability game, participating in a responsible sourcing initiative for mica, a raw materials used in some car paints. (Porsche)
- Navistar and Traton reached a tentative agreement for Traton to take over the US firm, in which it already owns a minority stake. (VW)
- VW unveiled the Tarek small crossover (to be called Taos in some markets). (VW)
Other
- Arrival received $118 million in funding (Reuters) and celebrated by announcing announced a new factory, initially for buses, in South Carolina, USA. (Autocar)
- Electric bus maker Proterra announced a $200 million investment round. (TechCrunch)
- Workhorse raised $200 million in debt. (Workhorse)
- Fisker will no long use VW’s MEB platform for the forthcoming Ocean SUV, instead it will sit on Magna’s electric vehicle architecture. The car will be built in Magna’s plant (as already announced). (Magna)
- Lucid opened its order book for the all-electric Air. (Lucid). Karma did likewise for the GSe-6. (Karma)
- Local Motors raised $15 million from the VC fund that includes Toyota as one of its main backers. (Local Motors)
- Nikola’s CEO said that if the company didn’t agree a technology sharing and manufacturing agreement with GM then it could go it alone to build the Badger pickup, or drop it altogether. (Bloomberg)
- Bollinger’s founder says lots of special purpose vehicles have been offering him deals but he hopes to wait until his company has risen in value before considering a public listing. (Bloomberg)
- Foxconn unveiled the MIH Open Platform, hoping that the technology set can underpin cars from a variety of different brands. (CNBC)
News about other companies and trends
Economic / Political News
- European passenger car registrations in September of 1,300,048 units rose 1.1% on a year-over-year basis. (ACEA)
Suppliers
- Liberty House bid for ThyssenKrupp’s steelmaking unit. (Industry Europe)
- Valmet sold off its German vehicle engineering business. (Valmet)
- Honda successfully completed the tender offer of portfolio companies Keihin, Nissin Kogyo and Showa, enabling a merger of the three units with Hitachi Automotive. (Honda)
- Magna will supply the electric vehicle architecture for Fisker to use for the forthcoming Ocean SUV, replacing VW’s MEB component set. (Magna)
- VDL’s Nedcar plant, lost the contract to build the Mini and BMW X1 after 2023. (Dutch News)
- TomTom reported Q3 revenues of $148 million and a net loss of $(67) million. (TomTom)
Ride-Hailing, Car Sharing & Rental (history)
- Car sharing firm Getaround raised $140 million. (Auto Rental News)
- Uber is investing $150 million in a South Korean ride hailing joint venture with SK Telecom. (Reuters) The firm is rumoured to be looking to offload part of its flying taxi business. (Reuters)
- Hertz raised $1.65 billion in debt to help it survive bankruptcy proceedings. (Auto Rental News)
- Toyota Tsusho invested in Data Integrated (DIL) a Kenyan firm that aggregates informal bus operators. (Toyota)
Driverless / Autonomy (history)
- Innoviz says that its next lidar sensor will cost less than $500. (Reuters)
- GM’s Cruise self-driving unit will soon start testing in San Francisco without safety drivers. (Cruise)
- Tesla CEO Musk said that there would be a “beta” release of full self-driving next week. (Twitter)
- Battery maker LG says it is in talks with several OEMs about creating joint ventures. (Reuters)
- The Indonesian government is championing a plan to create a battery champion and says that, together with foreign partners, it will invest $12 billion in new factories. (Reuters)
Connectivity
- TomTom and Uber signed a new agreement for maps, which will give Uber the ability to edit. (TomTom)
Other
- Electric motorcycle maker Ultraviolette hopes to raise $75 million. (Deal Street Asia)
- Singaporean electric motorcycle developer Ion Mobility raised $3.3 million. (Deal Street Asia)
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