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Tesla’s opaque reporting; Volvo goes it alone on autonomous; and a big thumbs up for sharing. Please enjoy our auto industry and mobility briefing for 30th March to 5th April 2020. A PDF version can be found here.

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

  • Nothing To Regret — Tesla reported Q1 deliveries. The numbers were a bit down on the prior quarter, as expected but what I found interesting was the reporting itself. With the launch of Model Y, Tesla has chosen to bundle the new car with the Model 3’s numbers, meaning there isn’t any specific vehicle line detail available. Being fuzzy on sales in normally the preserve of low volume manufacturers or, for the likes of Daimler and BMW, fringe models. Why the lack of transparency?
  • Build Me Up Buttercup Volvo and Veoneer are dissolving their partnership for developing self-driving technologies. Volvo seems rather pleased with its side of the deal, retaining all the advanced driverless bits, but the outcome seems to be going against the grain (which is major manufacturers teaming up). Does Volvo really believe it can make it all alone, or does this only make sense in the context of a merger with Geely?
  • Wherever You Will Go GM will build two new electric cars for Honda in North America. The agreement builds on an earlier deal to share electric powertrain components and shows that GM is open-minded about sharing electric vehicle parts (perhaps partly after looking at VW and Ford). It is also something of a rarity for Honda to borrow someone else’s car (although not unprecedented). Will this move make others take notice?

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

Daimler (history)

  • Believes that in eight to ten years recycled batteries will become a significant source of raw materials and says that solid state batteries won’t be any good for passenger cars, even by the late 2020s, although it does see the technology as suitable for commercial vehicles. (Daimler)
  • Negotiated an additional €12 billion credit line. (Reuters)

FCA (history)

  • US sales of 446,768 units in Q1 2020 fell (10)% from a year earlier. (FCA)

Ferrari

  • Stopped share repurchases to conserve cash. (Ferrari)

Ford (history)

  • Reported Q1 2020 US sales of 516,330 units, (12.5)% down on prior year. (Ford)
  • Called for a stimulus to boost demand once coronavirus recedes and thinks that the shutdown has permanently accelerated a move towards online sales, at least in the USA. (Reuters)
  • Invested in autonomous driving software provider Phantom AI. (FINSMES)

Geely (includes Volvo) (history)

  • Geely reported 2019 full year financial results (excluding Volvo). Revenue of 97.4 billion RMB (about $13.7 billion), down (9)% versus prior year. Net profit of 8.3 billion RMB (about $1.2 billion) fell (35)%, blamed on intense competition in China. (Geely)
  • Volvo sold 131,889 cars in Q1 2020, a drop of (31.2)% from prior year. (Volvo)
  • Volvo and Veoneer agreed to dissolve the Zenuity driver assistance technology joint venture. Volvo will take on the bits that developed self-driving and Veoneer will get the simpler, but closer to production, L1 – L3 driver assistance technologies. (Veoneer)

General Motors (history)

  • Honda will engineer two new vehicles using GM’s electric vehicle platform, and GM will build the finished products in North America under a deal that strengthens an existing agreement to share battery technology. (Honda)
  • Sold 618,335 vehicles in the USA during Q1 2020, down (7)% on a year earlier. (GM)
  • Sold 461,716 vehicles in China during Q1 2020, a drop of (43.4)% on prior year. (GM)
  • GM’s decision to draw a $16 billion credit line appears to have imperilled discussions aimed at extending and slightly raising the amount on offer. Banks stung by the move are reportedly only willing to negotiate an extension of the credit that is soon to expire, not the full amount. (Reuters)

Honda (history)

  • Honda will engineer two new vehicles using GM’s electric vehicle platform, and GM will build the finished products in North America under a deal that strengthens an existing agreement to share battery technology. (Honda)

Hyundai / Kia (history)

  • Hyundai’s Q1 2020 sales were 904,726 units, (11.4)% worse than a year earlier. (Hyundai)
  • Kia’s Q1 2020 sales were 644,102 units, a drop of (0.9)% from Q1 2019. (Kia)
  • Constructing a new facility in Singapore that will include a pilot plant for electric vehicles and develop an automated production philosophy similar to that proposed by recent investment Arrival. (Business Times)

Mazda

  • Toyota’s financial arm started providing leasing deals to US Mazda dealers on a white label basis. (Toyota)

PSA (history)

  • Negotiated an additional €3 billion credit line. (Reuters)
  • Dongfeng said plans to reduce its stake in PSA — a pillar of the PSA / FCA merger plan — were under review following the drop in PSA’s share price. (Reuters)

Tesla (history)

  • Reported Q1 2020 deliveries of 88,400 units, a 40% rise on a year-over-year basis. Production fell (2)% quarter-over-quarter, as the addition of Model Y and the Shanghai plant failed to offset lost production from coronavirus. Tesla stopped reporting Model 3 sales figures independently, combining them with Model Y. (Tesla)

Toyota (history)

  • Created a joint venture to supply electricity from renewable sources to Toyota in Japan. (Toyota)
  • Formally established a joint venture with BYD to develop electric vehicle technology. (Toyota)
  • Toyota’s financial arm started providing leasing deals to US Mazda dealers on a white label basis. (Toyota)

VW Group (history)

  • Says that in Germany 50% of customers are now ordering all-electric versions of the Up! city car and one in seven Passat sales are for the plug-in hybrid powertrain. (VW)
  • Audi has apparently decided not to develop an all-electric version of the A8 and will only offer the car as a plug-in hybrid. (Automotive News)

Other

  • Mahindra rejected pleas from South Korean subsidiary Ssangyong for a $400 million cash infusion, saying the brand should find alternative sources, but that it might be prepared to chip in $30 million. (Times of India)
  • Despite Nio’s financial troubles, the company’s VC arm invested in Chinese cloud computing provider BoCloud. (China Money Network)

News about other companies and trends

Economic / Political News

  • ACEA says 1.1 million workers directly employed by car and truck makers have been laid off as a result of coronavirus, and 1.2 million units have been lost. (ACEA)
  • US light vehicle SAAR in March of 11.37 million units fell (35)% on a year-over-year basis. (Wards)
  • March passenger car registrations in Germany of 215,119 units fell (37.7)% from prior year. (KBA)
  • UK passenger car registrations in March dropped (44)% versus 2019 to 254,684 units. (SMMT)
  • Spanish March registrations of 37,644 units fell (69.3)% from a year earlier. (ANFAC)
  • Italian passenger car registrations for March of 28,326 units fell (85.4)% from prior year. (UNRAE)
  • Passenger car registrations in France during March fell (72.2)% to 62,668 units. (CCFA)
  • German car making bosses reportedly warned chancellor Merkel that many suppliers could go to the wall and restarting production will not be easy without all EU countries being given the all clear, due to the spread of the supply base across the economic bloc. (Handelsblatt)

Suppliers

  • BorgWarner said Delphi has materially breached the merger agreement by drawing a $500 million credit line. The announcement appeared to be positioning to improve the deal terms. (BorgWarner)
  • Nidec bought part of Secop’s non-automotive business. (Nidec)
  • Toyoda Gosei is putting all its Indian assets into the joint venture with Minda. (Toyoda Gosei)
  • Valmet Automotive’s 2019 FY revenue was €652 million and operating profit was €18 million. (Valmet)
  • Volvo and Veoneer agreed to dissolve the Zenuity driver assistance technology joint venture. Volvo will take on the bits that developed self-driving and Veoneer will get the simpler, but closer to production, L1 – L3 driver assistance technologies. The Zenuity brand will continue, but only as a passive IP holding company. (Veoneer)

Dealers

  • Ford thinks that the shutdown has permanently accelerated a move towards online sales in the USA. (Reuters)

Ride-Hailing, Car Sharing & Rental (history)

  • Ride hailing firm Via says it is worth $2.25 billion after a Series E funding round that included investment by FCA’s controlling shareholder EXOR, which forked out $200 million. (Via)
  • Grab appointed a new CFO. (Grab)

Driverless / Autonomy (history)

  • Autonomous vehicle simulation firm Qcraft raised $24 million. (VentureBeat)
  • Self-driving warehouse robot developer Seegrid raised $25 million. (VentureBeat)
  • Lidar firm Quanergy raised an undisclosed amount and appointed a new CEO. (Quanergy)
  • Waymo shared a blog post explaining how it creates new images, even lidar point clouds, to improve object identification. (Waymo)
  • Yamaha and Tier IV created a joint venture, eve autonomy, to offer autonomous logistics to factories. (Autocar)
  • Ford invested in autonomous driving software provider Phantom AI’s $22 million round. (FINSMES)

Electrification (history)

  • Battery technology developer Addionics raised $6 million. (TechCrunch)
  • Daimler believes that in eight to ten years recycled batteries will become a significant source of raw materials and says that solid state batteries won’t be any good for passenger cars, even by the late 2020s, although it does see the technology as suitable for commercial vehicles. (Daimler)

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