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+++ AUDI has lowered its guidance for profitability this year on mounting costs of the diesel emissions scandal and possible recalls of cars fitted with Takata airbags. Audi said on Thursday it has “additional financial burdens” of 620 million euros in the third quarter. It did not say what these costs were related to. Audi’s operating margin should fall “considerably below” the carmaker’s 8-10 percent target range, it said. In late July, the Volkswagen division had guided for its profitability benchmark to only slightly miss the target corridor. +++

+++ A BMW i5 SUV is strongly tipped to be the firm’s next all-new all-electric model, but it is not scheduled for launch until 2021. Earlier this year, Harald Krüger, chairman of the board of management at BMW, revealed that the next BMW i product would be launched in 2021, dubbing it ‘i Next’. But he declined to elaborate beyond describing the future model as the “new spearhead of innovation and technology”. Now sources have suggested that BMW has settled on an SUV bodystyle for its next model, reasoning that it is a shape with global appeal in a segment with booming sales and greater profit margins than hatchbacks or saloons. In addition, an SUV bodystyle more easily accommodates the bulky battery pack without compromising proportions. Without commenting on the bodystyle, Ian Robertson, BMW’s head of sales and marketing, confirmed the firm was waiting until 2021 for its next major launch so it could take advantage of “the next big steps in electric motor, battery and autonomy”. He said: “We are at the very early stages of i, but already we’re coming up to our 100,000th registration. Just as with M, there are opportunities that take time to build up, from i cars to i Performance products to i kit, such as an electric scooter. “We conceived the i brand to work for the long term. The electric car market is emerging but we see enough to be confident that consumers are understanding what it is about. What’s more, 80% of i customers are new to BMW”. Robertson added that the lessons learned from the i3 and i8 continue to give BMW an advantage over its opposition. He said: “The beauty of those cars is that they give us a competency in the field of electric cars and lightweight technology — not just in people, but in manufacturing, too. We are way ahead in the manufacturing of lightweight carbonfibre, for instance”. Between now and 2021, the i8 Roadster will be launched — most likely in 2018. No details have been confirmed but sources say it will share the coupé’s powertrain and closely reflect the i8 Roadster concept first revealed in 2012. +++

+++ The ‘ One FORD ’ policy, under which the same basic models are sold in all regions around the world, “has peaked”, according to the company’s global design chief, Moray Callum. Speaking to Autocar, he said the approach isn’t being abandoned, but new models will be “more tailored to each region”. Of the One Ford policy, introduced by previous Ford boss Alan Mulally, Callum said: “It was the right approach at the time”. One Ford prompted the development of the Mustang as a global model, the launch of the Fiesta in the US and the arrival of the Brazilian Ecosport crossover in Europe, as well as the disposal of the Aston Martin, Jaguar, Land Rover, Volvo and part-owned Mazda brands from Ford’s portfolio. The One Ford strategy was also partly responsible for returning Ford to financial health following the 2008 financial crisis. Callum said the next Focus will diverge a little from the original philosophy. “It’s an entry-level model in the US, but not in Europe,” he said. “They will be visually similar but there will be less content for the US model”. As well as a reduced level of standard equipment, the US Focus could feature less sophisticated suspension, given that the need for strong driving dynamics is less vital in this market and at this price point. Callum also talked about Ford design. He described the design language as “post-kinetic”, but said it was still being used. “For Ford, it means cars that are fun to drive and great to look at”, he added. “We won’t change it dramatically. It will just evolve”. What it evolves into probably won’t have a label. “I’m not into names”, he said. Spy pictures of the imminent next Fiesta have revealed a car that appears to have evolved quite modestly. However, Callum said: “There will be more of a step change in style after the Fiesta”. Of the Vignale sub-brand, Callum said: “There will be no stand-alone model for the foreseeable future.” But he added: “New models are being designed with Vignale requirements in mind, so they will be better differentiated”. That includes the next Fiesta, which will have a Vignale edition from launch. +++

+++ HONDA reported a sharp rise in net profit for the fiscal second quarter on the back of cost-cutting and a reprieve from expenses related to recalls due to faulty air bags made by Takata. The company said net profit rose to 177 billion yen ($1.7 billion) for the 3 months ended Sept. 30, compared with 127.7 billion yen a year prior–a 38.6% increase. Revenue fell 9.9% over the same period to 3.26 trillion yen from 3.62 trillion yen last year, underlining the effectiveness of cost-saving efforts. This time last year, Honda was planning to set aside nearly 2% of its revenue to cover costs related to the air-bag related recalls. Honda trimmed its full-year revenue expectation to 13.40 trillion yen from a prior projection of 13.75 trillion yen, but net profit is expected to increase by 25 billion yen to 415 billion yen as a result of cost savings. +++

+++ MG has defended the arrival of Australia’s least-safest passenger car, claiming young customers will be drawn to the revived brand through value, style and sticker packs. The iconic British car maker was relaunched locally this week with a twin-pronged small car line-up, the MG3 city car and MG6 small hatchback – both of which feature the lowest crash-rating scores in their respective segments. The MG3 receives a three-star EuroNCAP rating while the MG6 has a four-star ANCAP rating, well below the five-star standard of class rivals. The MG3 costs $13,990 (plus on-road costs), making it one of the most affordable new cars in Australia and is available with a range of optional graphic packs, including a roof full of emoji faces, but it only has a basic suite of safety features which essentially comprises those that are mandatory for it to be sold in Australia. By comparison, the Skoda Fabia it competes directly against costs from just $15,990 and features modern semi autonomous emergency functions and a reverse camera as standard equipment while offering radar-based cruise control as an affordable option. MG Motors Australia’s marketing and communications boss, Danny Lenartic, conceded the safety ratings were not ideal and were a consequence of the age of the vehicles and technologies available at the time (the MG3 was crash-tested in Europe in 2014 while the MG6’s local result is from 2013) but also said that safety is not a defining factor to all customers. “People look at these cars and they are generally fun to drive. People will just want one”, he said. “To some consumers the three-star will be factor, but not to all consumers… otherwise Mahindra wouldn’t be selling any cars at all”. High-raking executives from MG’s Chinese parent company, Shanghai Automotive Industrial Corporation (SIAC), visited Australia for this week’s relaunch of MG as a fully-fledged subsidiary and told local media that safety is an important pillar for the brand, claiming the car’s steel structure is substantial enough to prevent injuries in a crash. “This car is safe”, said SAIC’s international business executive director Yang Xiaodong. “Firstly if you look at the weight of the steel we have, you will feel the door is very strong against other competitors. This is safety, but it depends on how you view safety. In China we are five-star. Australia follows Europe and this is the different aspects of safety”. Yang also said that advanced safety systems such as automated emergency braking and other semi autonomous functions are “not a technical issue” for SAIC and will be available in future generations of MG models that will ensure they meet the most stringent global crash test regimes. However, he also questioned the value equation and whether consumers would be willing to pay extra to have them installed. The boss of the Australian New Car Assessment Program (ANCAP), James Goodwin, countered Yang’s comments in a statement to Drive, saying “not only does the MG 3 fall down in the safety assist area of assessment, the vehicle’s passive safety foundation – its structure – is also of a poor standard”. “Our test requirements are increasing in stringency every year and this is the impetus for all brands to continually improve their designs with a focus on safety specification, not just aesthetics and infotainment”, he added. He also stated that ANCAP will evaluate any differences in specification between the cars sold locally and those that were used to achieve the EuroNCAP score to potentially derive a local crash test score for the MG3. Goodwin confirmed that ANCAP will also conduct local crash testing on the next MG model set to arrive in Australian showrooms, which is expected to be the MG GS mid-sized SUV later this year. “We understand there may be another MG model soon to enter our market, and we have our sights set on testing that model as soon as we’re able”, he said. +++

+++ Electrified versions of MERCEDES commercial vans could be headed Down Under in the not-too-distant future, with some of the company’s fleet customers pushing for more environmentally friendly powertrains. Daimler recently detailed its passenger car alternative powertrain strategy – highlighted by the recently revealed EQ SUV from the Paris motor show that will be a production reality within the coming years – and it has started to hint at a greener future for its delivery vans too. In September, the German giant ripped the covers from its futuristic Vision Van concept that previewed its adVANce initiative, which is a re-imagined delivery service that it says could revolutionise the way that cargo and packages are delivered, using drones and robots. While few details were provided of the powertrain at the time of the reveal, the van uses a 75kW electric drivetrain that has a driving range of between 80 and 270 km. While an all-electric powertrain is yet to be officially confirmed for mass production in a Mercedes-Benz Vans product, it is anticipated that it is a matter of time before one is applied to one of the products in the light-commercial portfolio. Speaking with GoAuto at the reveal in Sweden of the Concept X-Class, Mercedes-Benz Vans Australia managing director Diane Tarr said she was hopeful that electrification of the range would not be far off, adding that the demand was coming from some of the larger fleet customers. “Hopefully sooner than later”, she said. “I am really keen to support those kind of alternative power options in Australia. We are getting a lot of questions from big fleet customers who are really the drivers and they will be the ones that will dictate that. At the end of the day, we can build a vehicle, but there has to be an appetite for it. If our fleets are the ones that are saying, for whatever internal reasons, they want to drive electric vehicles and push that through, then we have to rely on them to drive the demand. As long as we can supply the vehicle. With that they also need to support and we will support the infrastructure that goes with it”. Increasingly tight global emissions regulations and a move to more environmentally responsible strategies from large corporations is likely behind the push by some corporates in Australia to roll out more electric options. Ms Tarr highlighted Mercedes’ history with electrified commercial vehicles and said that expertise could be used in the future. “We did introduce the Vito E-Cell electric vehicle three-to-four years ago. Unfortunately it was a little bit ahead of its time. We have already got the electric van credentials through the Vito E-Cell, it is just adapting that into the likes of Sprinter etcetera”. A new-generation version of the ageing Sprinter is just around the corner and while Mercedes is yet to confirm it, there is a good chance that the company will use the big van to roll-out new EV or PHEV powertrains specifically built for commercial applications. Volkswagen uncovered an electric version of its new Crafter van in September, but given it no longer shares its underpinnings with the Sprinter, it is unlikely that the Benz would use VW’s green technology for its new-gen van. Ms Tarr acknowledged that a lack of infrastructure in Australia was “always a challenge” for electric vehicles, and suggested that any possible future electric van would need to have an adequate driving range to properly compete with internal combustion rivals. “Of course we have got to look at the range. When we start talking about the final mile. It is really that short distance, urban delivery, there are merits for electric vans in that space”. Currently the Citan, Vito and Sprinter form Mercedes-Benz Vans’ global portfolio, but, as reported, they will be joined in 2017/18 by a production version of the just revealed X-Class ute. Daimler chairman and head of Mercedes-Benz Cars Dieter Zetsche ruled out a plug-in hybrid or electric version of the new ute, blaming weight and range as reasons to not pursue it this time around. Mercedes announced in July the development of a prototype for a 26-tonne battery-powered electric truck that is expected to have a 200 km range, while Daimler’s truck brand Fuso is conducting an Australian trial for its eCanter all-electric truck in 2017. +++

+++ MITSUBISHI ’s Pajero continues to soldier on in the face of speculation that its demise is just around the corner as the Japanese brand works on restructuring its SUV line-up with new-generation ‘soft-roader’ models across high-volume segments. The veteran Pajero, which can trace its lineage back to the 1999 NM series, has recently been upgraded to meet Euro 5 emissions standards for the 2017 model year. “It has been announced by Mitsubishi that it will continue in its current form, a spokesman told. “There are still strong markets for it in the Middle East, Latin America and Australia. It’s intrinsically a very strong product, it’s as good as the other off-readers out there, it’s still capable and that bit bigger than the Pajero Sport, so there’s a meaningful place for it in our line-up”. There is no replacement for the Pajero on the horizon – the last sighting came with the 2013 GC-PHEV (Grand Cruiser) concept – but, Mitsubishi has revised its SUV strategy in the past couple of years that will see the next-generation Outlander push up into the large segment – possibly with styling elements of the GT-PHEV shown at the recent Paris motor show – and the small ASX, previewed by the 2015 eX concept, move down a notch. This will leave room for an all-new mid-size SUV, which will be based on the original XR-PHEV (Cross Runner) shown at the 2013 Tokyo show alongside the GC-PHEV. This was subsequently updated with the XR-PHEV II shown in Geneva last year. “As announced there are 3 models – there’s the third one (mid-sizer) coming and there’s got to be an opportunity there to sell more SUVs. In terms of our SUV line-up we’re probably second to none”, the spokesman said. “In the next 2 years we’re likely to see it. It’s based on the XR-PHEV that was at the 2013 Tokyo motor show. That’s basically what is coming to market, but we don’t know what happens to that timetable relating to the Nissan deal. We’d like it sooner because we’re always in a hurry”. The new wave of SUVs will join the harder-core Pajero Sport and the long-in-the-tooth Pajero, emphasising that the latter remains a key part of the brand’s SUV range which has performed well in the marketplace to offset declining passenger car sales volume. +++

+++ TESLA Chief Executive Elon Musk on Friday unveiled new energy products aimed at illustrating the benefits of combining his electric car and battery maker with solar installer SolarCity. The billionaire entrepreneur showed of solar-powered roof tiles that eliminate the need for traditional panels and a longer-lasting home battery, which Tesla calls the Powerwall, aimed at realizing his vision of selling a fossil fuel free lifestyle to consumers. “This is sort of the integrated future. An electric car, a Powerwall and a solar roof. The key is it needs to be beautiful, affordable and seamlessly integrated,” Musk said while showcasing the products on homes that once served as the set of the television show “Desperate Housewives”. Musk is the biggest shareholder in both Tesla and SolarCity, which is run by two of his first cousins. Analysts have been dubious of the deal’s proposed synergies, with some suggesting the merger is a way for Tesla to rescue money-losing SolarCity. A vote on the acquisition is scheduled for Nov. 17. The rollout of the product, expected as soon as next summer, would be “unwieldy” if the two companies are not combined, Musk told reporters. Having two separate companies “slows things down, makes them more expensive. It’s worse for shareholders”, he said. Musk refused to answer a reporter’s question about how Tesla’s balance sheet would accommodate the acquisition of SolarCity. By incorporating solar modules into rooftops, Tesla is hoping to succeed with a solar technology that to date has had little success. Just this year, Dow Chemical said it would stop selling a solar shingle it launched five years ago. Tesla’s glass solar roof tiles would look far better than any similar product, Musk said. They can be manufactured in a range of styles, which were demonstrated on the rooftops on the set. Tesla gave little detail on cost, except to say that the cost of the roof would be less than a conventional roof plus solar. The product will appeal to home builders and people looking to replace their roofs, Musk said, adding that the shingles would be more durable and have better insulation qualities than conventional roofs. SolarCity co-founder Peter Rive, Musk’s cousin, said the solar roofs could easily have a five percent share of the new roof market within a year or two. The new generation of home and industrial batteries will be available this year. +++

+++ TOYOTA says it has invested in U.S. car-sharing company Getaround, a move that comes as global automakers seek to shore up their presence in new technology sectors amid growing competition from transport startups. The world’s biggest-selling automaker confirmed in an email to Reuters that it has invested in the San Francisco-based start-up through its investment fund, Mirai Creation Investment Limited Partnership, but declined to offer further details. On Friday, the Nikkei newspaper reported that Getaround was believed to have received around $10 million from the fund. Established last year, the fund which also includes Sumitomo Mitsui Banking Corporation (SMBC) as an investor, also invests in artificial intelligence and robotics. Getaround has been operating its on-demand car-sharing service in San Francisco, Chicago, Washington D.C., and other U.S. cities since 2013. It claims to have more than 200,000 members. Automakers have been scrambling to partner with tech firms to head off competition from self-driving cars and car sharing services that threaten to eventually trim demand for car ownership. Toyota’s investment follows similar moves this year by other automakers who have partnered with car sharing service providers, including General Motors and Lyft, and Volkswagen and Israel’s Gett. Toyota already has a partnership with Uber Technologies, through which the automaker leases vehicles to Uber drivers, and plans to work with the ride-hailing service to accelerate mobile technology research. +++

+++ VOLKSWAGEN will invest 150 million euros to build a logistics center near its assembly plant in Bratislava, Slovakia, the company said on Thursday. The logistics center will be opened in 2017 and an external partner will run it, the company said. Volkswagen exports almost all of the vehicles it makes in the Slovak factory. It produces Volkswagen Touareg, Audi Q7, Volkswagen Up, Seat Mii, Skoda Citigo and bodies for Porsche Cayenne at its Slovak plant. It will also launch a Porsche Cayenne assembly line next year. Slovakia, the world’s biggest per-capita car producer, is also home to Kia (000270.KS) and OSA (Peugeot, Citroen, DS) plants and a new Jaguar Land Rover plant is expected to come online in 2018. +++

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