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+++ The next-generation BENTLEY Continental GT has been spotted testing in convertible GTC form ahead of the new model’s expected launch in 2018. Both the 2018 GT coupé and GTC convertible feature new front-end styling that appears to draw from the EXP 10 Speed 6 concept first seen at last year’s Geneva motor show – including a lower front and rear than the current car, as well as shorter overhangs and a shorter wheelbase. Despite receiving new styling features, the Continental still carries Bentley’s hallmark design, including plenty of cues from the current model. The next Continental will be based on a new platform called MSB, which has been developed by Porsche. It will be used primarily for the next-generation Panamera. The Continental range will be significantly lighter than the outgoing model, Bentley boss Wolfgang Dürheimer has said. Like the firm’s Bentayga SUV, the Continental’s bodyshell will be a hybrid-materials structure, with assorted high-strength steels reinforcing a body made mainly from aluminium. The current car is steel-bodied. This change is part of a mass-reduction effort that should drop the car’s weight substantially below the 2.375 kg of today’s GT. However, it will not fall below 2 tonnes, Dürheimer said. Powertrains will include the all-new 608 hp W12 that’s making its debut in the Bentayga and an updated 4.0-litre petrol V8. There will also be a petrol V6 plug-in hybrid, which will use a set-up that develops 410 hp in today’s Porsche Cayenne plug-in hybrid. It’s unlikely that Bentley will offer a diesel V8 option in the Continental. This engine is soon to appear in the Bentayga with around 40 hp, rather than the 380 hp that it develops in the Cayenne. Speaking at the Bentayga’s launch earlier this year, Dürheimer said his “personal goal is a sustainable, stand-alone business with an annual production volume of 20,000 units”. He envisages 7 model lines, although the Bentayga-derived sports SUV and the production version of the EXP 10 Speed 6 coupé that would be the 6th and 7th ranges have yet to be signed off. Talking about the advantages of Bentley being part of the new Sports and Luxury Group at Volkswagen, Dürheimer said the VW Group test drives that take place in Namibia will now be split among the new groups and involve fewer cars. More can be achieved this way, he said. Another gain will be sharing research and development skills, as well as a supplier base suitable for high-performance and luxury models from Porsche, Bentley and Bugatti. Dürheimer added that Lamborghini’s absence from this group “makes no sense”. +++

+++ GENERAL MOTORS could scale back its operations in Europe as a result of the Brexit vote and falling currency rates, which has wiped $100 million off the American carmaker’s books in recent months. The Detroit-based carmaker, which owns Vauxhall in the United Kingdom, is struggling to make a profit in Europe. The fall in the value of the pound following the UK’s decision to leave the European Union and levelling vehicle demand in the US is estimated to cost the company $300 million by the end of the year. Chuck Stevens, General Motors’ chief financial officer, said: “We are prepared to take whatever action is necessary to put Europe on the path”. He added: “The pound sterling has deteriorated further, which creates another headwind for us. Breaking even this year is going to be very challenging”. General Motors already raised prices in the UK by 2.5 per cent on October 1 and is now looking at cutting costs. The company has already cut working hours at its German plants building the Corsa and Insignia. Stevens said: “We will look across all aspects of the business and take whatever action is necessary to get the business back on track”. The future of Vauxhall’s Ellesmere Port, which currently builds the Astra, is dependent on EU sales, as 80 per cent of the 120,000 produced annually are exported to other member countries. However, UK sales have so far failed to dip as expected by some, and Stevens emphasised that it is “too early to say anything specific about capacity reductions” in the UK or mainland Europe. General Motors is due to announce whether it will build the next generation Astra in the UK or elsewhere in the coming months. +++

+++ HYUNDAIMotor, South Korea’s top automaker, posted its lowest third-quarter operating profit since 2010, a consequence of labor strikes and poor sales in emerging markets that have been racking the carmaker since July. Operating profit during the July-September period recorded a 29 percent plunge from last year, tumbling from 1.50 trillion won ($1.32 billion) to 1.07 trillion won. Revenue also fell by 5.7 percent from 24.68 trillion won last year to 22.08 trillion won this year. The performance was worse than the already low expectations issued by local brokerage houses, which predicted the automaker would at least reach 1.3 trillion won in operating profit. “The third-quarter performance was inevitably affected by the prolonged labor strikes that led to factory production suspension”, a Hyundai Motor spokesperson said. “There was a rebound on the back of expanded premium cars and sport utility vehicle sales, but it wasn’t enough to compensate for the loss generated from domestic production suspension”. Expanded marketing costs for the Genesis brand, which launched in the United States in September, and increased R&D investment also factored into the deteriorated profit. The number of vehicles sold globally also shrank as emerging markets like Russia and Brazil showed weak demand for cars due to an economic slump. Sales in China stabilized, though slow growth in advanced economies like the United States hurt performance. During the July-September period, Hyundai Motor sold a total of 1.08 million units, a 3.3 percent year-on-year drop. This is the worst performance since 2012’s third-quarter performance, when it sold a million units. “It will not be easy to achieve the goal set for this year due to the economic slump in emerging markets like Russia, Brazil and the Middle East”, Choi Byung-chul, the company’s chief financial officer, said. Hyundai Motor’s sales goal for this year is 5.01 million, but it has so far only sold 3.5 million units. Analysts believe a major turnaround in the fourth quarter is unlikely. Nonetheless, the automaker is holding its breath and gunning for a breakthrough with fresh lineups. On Tuesday, the automaker unveiled a full-model change version of its flagship Grandeur IG premium sedan, which comes 5 years after its previous HG model. It will go on sale next month in Korea. In China, the company recently completed its fourth plant in the country in the southern city of Changzhou. The factory is capable of producing 300,000 vehicles a year. A newly-unveiled Verna is expected to boost local sales. And earlier this month, the company concluded a wage deal with its labor union, putting an end to nearly a 5-month long negotiation period that included on-and-off walkouts by the union. “Even if market conditions are not looking good for Q4, the production line is back in normal operation and we have many new cars to be launched in major markets”, Hyundai Motor said in a media release. “We are going to put the best effort in upping our performance”. +++

+++ South Korea’s No. 2 automaker, KIA Motors, said that its third quarter net profit jumped 20.8 percent from a year earlier despite a slight drop in sales. In the July-September period, Kia Motors’ net profit came to 664.3 billion won ($583.23 million) on a consolidated basis, compared with a net profit of 550.1 billion won in the same period last year, the company said in a regulatory filing. Sales dropped 3.1 percent on-year to some 12.7 trillion won over the cited period, with operating profit plunging 22.5 percent to 524.8 billion won. “The company’s accumulated sales and operating profit expanded in the first 3 quarters of the year on the launch of new vehicle models and weakening of the local currency, but in the third quarter, its operating profit dropped significantly due to reduced output caused by labor strikes and strengthening of the South Korean won”, a company official said, speaking on condition of anonymity. In the first 9 months of the year, the company’s sales came to about 39.8 trillion won, up 8.4 percent from the same period last year, the company said in a press release. Operating profit gained 4.9 percent on-year to some 1.93 trillion won over the cited period, while its net profit jumped 10.7 percent to 2.43 trillion won. The rise in sales revenue came despite a 2.1 percent drop in the number of vehicles sold in the January-September period. Kia Motors attributed the increase to a rise in sales of large, high-end vehicles. “Small, compact cars accounted for 46.2 percent of total sales in the first 9 months of the year, down from 49.1 percent in the same period last year, while the portion of SUVs expanded to 38.1 percent from 33.8 percent over the cited period”, a company official said. +++

+++ The launch of an all-new car brand is always interesting. But I found last week’s global introduction of LYNK & CO – Chinese giant Geely’s project that aims to take the connected car concept to a new level – especially fascinating, not least because of the honesty of all involved. Firstly, Conghui An, president and CEO of the Geely Auto Group, tacitly admitted: “Many will say the world does not need another auto brand”. Then Peter Horbury, executive vice president of Geely Design, confessed that creating the all-new brand was “incredibly challenging”. Starting with, literally, a blank piece of paper was, he continued, “daunting, but also liberating”. The brand’s SUV, the 01 is, to these eyes at least, a credible start. And then, of course, there is the fact that Geely’s involvement will conjure up mainly negative preconceptions for some buyers on account of its Chinese heritage. Lynk & Co vice-president Alain Visser tackled this head on, saying: “We think that this may be one of the biggest potential hurdles. There is a perception of lack of quality with Chinese cars, and even of fake products. That’s why our link with Volvo (another Geely brand) is so important”. The fact Lynk & Co has gone to such lengths to develop the car in Sweden and give it a European look, when half its sales will be in China, says a lot about how Chinese cars are seen in their home market. I’ll be curious to see if this bold approach works. What does it all mean for us? Well, an innovative sales model – with opportunities for sharing, leasing and subscriptions for urban users – is arguably of more interest than the car itself. “We’re selling mobility, not cars”, is how Visser put it. With recent data showing megacities are on a rise, Lynk & Co’s arrival could be quite timely. You can bet the industry will be watching with interest. +++

+++ The next-generation NISSAN Qashqai and X-Trail models will be built alongside the Juke at the Nissan’s Sunderland production plant, meaning the factory in the north east of England will become a European hub for crossover production. The move will ensure the survival of more than 7.000 jobs in Sunderland, with Nissan confirming that the decision was made following strong support from the British Government, which is working to ensure the UK’s automotive industry remains strong during Britain’s ejection from the European Union.
Nissan’s announcement ends rumours that the Sunderland plant could downsize following the Brexit vote. Chairman and CEO of Nissan Carlos Ghosn said “I am pleased to announce that Nissan will continue to invest in Sunderland. Our employees there continue to make the plant a globally competitive powerhouse, producing high-quality, high-value products every day. The support and assurances of the UK Government enabled us to decide that the next-generation Qashqai and X-Trail will be produced at Sunderland. I welcome British Prime Minister Theresa May’s commitment to the automotive industry in Britain and to the development of an overall industrial strategy”. The updated Qashqai will arrive next year with sophisticated autonomous technology. The facelifted X-Trail will also arrive in 2017. +++

+++ Production of the SEAT Ibiza ST  has been halted because of poor sales and the rising popularity of small SUVs. The Ibiza ST is the latest model to be dropped from the unpopular sub-compact estate segment, following the departure of the Peugeot 207 SW in 2014. Analysts say that small estates – known in the industry as the B-SW segment – have never been particularly sought after. Cars of that type account for a tiny amount of the overall sub-compact segment. Felipe Munoz, a global automotive analyst at market research firm Jato, says that Ibiza ST sales had dropped continuously since its 2011 peak. The departure of the Ibiza ST means that the Renault Clio Estate, Skoda Fabia Estate and Dacia Logan MCV are the only small estates still on sale. Munoz said the rise in popularity of small SUVs (B-SUVs) was a major factor in the declining sales of small estates. He noted that most small SUVs have an estate-like bodyshell but are taller, making them both more capable and more attractive to customers. “The B-SW average prices are not far from the B-SUVs”, he said. “In fact, the average price of the registered Peugeot 2008 in Europe in the first half of 2016 was 7.8% higher than the average price of the Seat Ibiza ST. In general, the SW body type continues to lose ground in the majority of global markets. Only Italy, Germany and Northern Europe show a preference for that body type. SWs have almost disappeared from the US market, while in China and South America they are quite rare to see”. A Seat spokeswoman said production of the Ibiza ST had stopped in May 2016, and it was not included in the recent Ibiza range facelift. The spokeswoman confirmed that the halting of production was due to poor sales, in contrast to Seat’s other estate car, the Leon ST, which sells comparatively well. +++

+++ A U.S. federal judge on Tuesday approved VOLKSWAGEN ’s record $14.7 billion settlement with regulators and owners of 475,000 polluting diesel vehicles, and the German automaker said it would begin buying back the cars in mid-November. It represented one of the biggest corporate settlements of any kind. The action by U.S. District Judge Charles Breyer in San Francisco marked a pivotal moment for Volkswagen as it aims to move past a scandal that has engulfed the company since it admitted in September 2015 to installing secret software in diesel cars to cheat exhaust emissions tests and make them appear cleaner than they really were. Hinrich Wöbcken, president and CEO of Volkswagen Group of America, called final approval of a settlement first announced in June “an important milestone in our journey to making things right in the United States”, and pledged to carry out the terms “as seamlessly as possible”. Breyer turned away objections from car owners who thought the settlement did not provide enough money, saying it “adequately and fairly compensates” them. In addition to the pre-scandal “trade in” value of the vehicle, owners will receive $5,100 to $10,000 in additional compensation. “Given the risks of prolonged litigation, the immediate settlement of this matter is far preferable”, Breyer wrote. The settlement was reached with the U.S. Justice Department, Federal Trade Commission, the state of California and vehicle owners who had filed a class action lawsuit against the world’s No. 2 automaker. Volkswagen has admitted to misleading regulators and still faces an ongoing criminal investigation. Volkswagen agreed to spend up to $10.033 billion on the buybacks and owner compensation and $4.7 billion on programs to offset excess emissions and boost clean-vehicle projects. Volkswagen may also be allowed to repair vehicles if regulators approve fixes. The affected vehicles emit up to 40 times legally allowable pollution levels. It represented the largest civil settlement worldwide ever reached with an automaker accused of misconduct. While huge, the approved deal was still smaller than the $246 billion settlement reached by cigarette makers with 46 U.S. states in 1998 and the $53 billion by BP to address costs and penalties arising from the 2010 Gulf of Mexico oil spill. In total, Volkswagen has agreed to date to spend up to $16.5 billion in connection with the scandal, including payments to dealers, states and attorneys for owners. The scandal rattled Volkswagen ’s global business, harmed its reputation and prompted the ouster of its CEO. The settlement covers 2.0-liter polluting diesel Beetle, Golf, Jetta, Passat and Audi A3 cars from the 2009 through 2015 model years. Up to 490,000 people will take part in the settlement because some vehicles had multiple owners. Volkswagen spokeswoman Jeannine Ginivan said the automaker expects to begin buying back vehicles in mid-November. Volkswagen has hired 900 people, including one to be stationed at each dealership, to handle buybacks. Volkswagen still faces billions more in costs to address 85,000 polluting 3.0 liter vehicles and Justice Department fines for violating clean air laws. It also faces lawsuits from at least 16 U.S. states for additional claims that could hike the company’s overall costs. Last month, a Volkswagen engineer pleaded guilty to helping the company evade U.S. emission standards. His lawyer said he would cooperate with federal authorities in their criminal probe. In 2013, a non-profit group commissioned researchers at West Virginia University to test diesel car emissions, and found excess emissions in 2 Volkswagen diesels. After the U.S. Environmental Protection Agency and California spent more than a year trying to understand the cause, Volkswagen admitted last year it secretly installed software to turn off emissions equipment in real-world driving. “Today is a landmark day, when this innovative settlement can be put into action, investing billions of dollars into public health protections to remedy these serious violations”, Cynthia Giles, the EPA’s assistant administrator, said. Volkswagen will provide $2 billion over 10 years to fund programs to promote construction of electric vehicle charging infrastructure, development of zero-emission ride-sharing fleets and other efforts to boost sales of cars that do not burn petroleum. Volkswagen has been in intensive talks over how much compensation it may offer owners of the larger 3.0 liter diesel Porsche, Audi and Volkswagen vehicles that emit up to nine times legally allowable emissions and whether it will offer buybacks for some of the polluting SUVs but no final agreement has been reached. Volkswagen faces a Nov. 3 court hearing to update the court on those vehicles’ status. Volkswagen agreed to make up to $1.21 billion in payments to 652 U.S. VW brand dealers and $600 million to 44 U.S. states to address some state claims. Nearly 340,000 owners have registered to take part in the settlement. About 3,500 owners have opted out. Volkswagen must fix or buy back 85 percent of the 475,000 vehicles under the agreement by June 2019 or face additional costs. +++

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