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+++ BATTERY powered cars will soon be cheaper to buy than conventional gasoline ones, offering immediate savings to drivers, new research shows. Automakers from Renault to Tesla have long touted the cheaper fuel and running costs of electric vehicles (EV) that helps to displace the higher upfront prices that drivers pay when they buy the zero-emission vehicles. Now research from Bloomberg New Energy Finance indicates that falling battery costs will mean electric vehicles will also be cheaper to buy in the U.S. and Europe as soon as 2025. Batteries currently account for about half the cost of EVs, and their prices will fall by about 77 percent between 2016 and 2030, the London-based researcher said. “On an upfront basis, these things will start to get cheaper and people will start to adopt them more as price parity gets closer”, said Colin McKerracher, analyst at the London-based researcher. “After that it gets even more compelling”. Renault, maker of the Zoe electric car, predicts total ownership costs of EVs will by the early 2020s equal conventional internal combustion engine vehicles (known in the trade as ICE), according to Gilles Normand, the French company’s senior vice president for electric vehicles. “We have 2 curves”, Normand said in an interview earlier this month in London. “One is EV technology cost reductions because there are more breakthroughs in the cost of technology and more volume, so the cost of EVs will go down. ICE going to go up as a result of more stringent regulations especially regarding to particulate regulations”. +++

+++ BMW details the track-only M4 GT4. The M4 GT4 will make its competition debut next year. BMW has introduced the track-only M4 GT4 after a long teaser campaign. The race car will make its public debut at the Nurburgring 24 Hours race, though it’s not officially competing in the event. Power comes from a 3.0-liter straight-six engine that’s turbocharged and direct-injected. The GT4 is the first BMW race car compatible with power sticks, meaning teams can dial in the precise amount of power they need and plug the settings directly into the ECU. The six makes 430 horsepower in its most basic configuration, and it exhales through a GT4-specific exhaust system. A 7-speed dual-clutch automatic transmission channels the engine’s output to the rear wheels, while six-piston front calipers borrowed from the bigger M6 GT3 safely bring the action to a stop. The long list of suspension modifications includes special shock absorbers, springs with three settings, adjustable stabilizer bars, and a motorsport-specific dynamic stability control (DSC) system. To shed weight, BMW manufactured the doors, the hood, and most of the body kit out of carbon fiber. The cabin has been pared down to just a driver’s seat, a rectangular steering wheel, a digital instrument cluster, and a GT4-specific center console. The BMW M4 GT4 is on-sale now. Pricing starts at 169,000 euros in Germany. Deliveries will start before the end of the year, and the GT4 will start racing next year. +++

+++ Economic recovery increases the DEATH RATES. The latest data suggests recent improvements in vehicle designs have hit a plateau in safety. The ongoing economic recovery has resulted in higher rate of traffic deaths, according to the Insurance Institute for Highway Safety. The link between increased commuting miles and more car accidents seems obvious, but the IIHS says only half of the effect of the economy on traffic deaths is due to more driving. “Riskier, discretionary driving (for example, going out to dinner or traveling for vacation) is affected by economic fluctuations even more than day-to-day commuting”, the report adds. “Economic conditions also affect how fast people drive”. Notably, the IIHS not long ago reported a steep jump in safety as death rates dropped by more than a third over three years. The decline was associated with a shift in vehicle designs and safety technology, however such improvements appear to have hit a plateau in reducing fatal accidents. “The latest driver death rates show there is a limit to how much these changes can accomplish without other kinds of efforts”, says IIHS research chief David Zuby. The latest data reveals nearly 2 dozen individual models associated with less than 8 driver deaths per million registered vehicle years, a standard metric to compare relative safety between different vehicles. Models with a death rate of zero include the Audi A6 and Q7; BMW 535; Jeep Cherokee; Lexus CT 200h and RX 350; Mazda CX-9; Mercedes-Benz M-Class; Toyota Tacoma Double Cab and the Volkswagen Tiguan. At the other end of the spectrum, the highest death rates are associated with small vehicles. The Hyundai Accent, Kia Rio and Scion tC all have more than 100 deaths per million registered vehicle years. The Chevrolet Spark, Nissan Versa and Ford Fiesta aren’t far behind, followed by the Kia Soul and Dodge Challenger. “Among the 10 vehicles with the highest rates, 5 are minicars and 3 are small cars”, the report notes. “These vehicles don’t protect occupants as well as larger ones, so their presence at the top of the ‘worst’ list isn’t surprising”. The IIHS acknowledges that autonomous vehicles could theoretically eliminate all crashes, but it will take decades before such technologies are installed in all new vehicles. +++

+++ FARADAY Future is raising $1 billion. The startup is meeting with potential investors. Faraday Future’s endeavor to beat Tesla and dominate the premium electric car segment has hit a snag, according to a recent report. LeEco, the company’s main financial backer, is in dire financial straits. Bloomberg reports the Chinese tech giant tried expanding too fast into too many industries. In addition to Faraday Future, it funds a second electric car startup named LeSEE that’s focused exclusively on the Chinese market, a ride-hailing service, and a Netflix-like streaming service. It also builds smartphones and televisions. The group was founded by billionaire Jia Yueting. He recently stepped down from his role as CEO, and he announced he will no longer invest his own money into Faraday Future. Sources familiar with the startup’s day-to-day operations revealed it’s meeting with large-scale investors in a bid to raise about $1 billion. The money will go towards finishing its ambitious factory in Las Vegas, Nevada, and turning the FF91 prototype shown earlier this year at CES into a production car. Executives hope to secure the funding in the coming months. LeEco is scaling back its expansion plans in the United States and slashing 325 jobs, Bloomberg adds. However, Faraday Future’s growth won’t be affected, and insiders are confident the FF91 will reach production sooner or later. +++

+++ Jim Hackett spent the last year plotting FORD ’s long-term self-driving car strategy. In his first week as chief executive, he has more immediate concerns: stopping a skid in North American sales and fending off a market share grab by resurgent archrival General Motors. The U.S. No. 2 automaker is stuck in a product drought that shows no signs of easing until 2019, according to 2 sources who track Detroit’s launch plans. Given the auto industry’s long product cycles, it is not clear what Hackett can do immediately to get Ford out of its predicament, which can be traced back to decisions by former CEOs. Hackett was tapped to run the company’s autonomous car and ride-sharing unit a year ago. He unexpectedly found himself at the helm of the whole company as Ford axed CEO Mark Fields. He now has to face up to a void of new vehicles, partly caused by former CEO Alan Mulally, who focused much of the company’s resources on an expensive 2014 redesign of Ford’s crown jewel, the F-Series pickup. That safeguarded America’s longtime best-selling vehicle, but it prevented Ford from developing other hits. Given that it typically takes 3 to 4 years for a new or redesigned vehicle to get into production, the full effect of Mulally’s narrow focus is now being felt. Mulally also gambled heavily on making an expensive shift to aluminum from steel to lighten up trucks and make them more fuel efficient, a bet that looks questionable in retrospect, as gas prices have remained far lower than anyone expected. If Fields had immediately started pulling forward product launches when he took over from Mulally in July 2014, the first of those would likely reach the market in the autumn of 2018 at the earliest. As it is, Ford must wait until early 2019 for its first big slug of new models to hit showrooms. There is not much Hackett can do about that. Any product moves he makes today would not likely show up in the market before 2021. “Ford needs to move faster”, said RBC auto analyst Joseph Spak. Hackett, only 3 days into his new job, has not yet laid out his plans for Ford publicly. Ford spokesman Michael Levine side-stepped questions of a short-term product drought. “We’re bullish on our strong pipeline of all-new cars coming in the next 5 years”, he told. “What’s more, the vehicles that we are launching will continue to deliver high transaction prices and good business”. For much of the past decade, Ford has benefited from management and marketing problems at General Motors, including GM’s 2009 bankruptcy and a safety scandal that hobbled the company in 2014. Now, however, Ford confronts a crosstown rival largely free of debt and focused on grabbing market share from Ford, particularly in the pick-up and SUV segments which account for most of both companies’ profits. GM, the No. 1 U.S. automaker, is in the midst of a prolific 4-year patch of new vehicle launches, many approved by Mary Barra, the company’s former head of global product development who was named CEO in January 2014. In hindsight, GM benefited from its bankruptcy, as it emerged essentially debt-free and able to spend more on new products. Ford did not seek bankruptcy during last decade’s auto industry crisis, and instead borrowed heavily to survive it, leaving it short on cash to invest in new vehicles. That result of that disparity is now becoming evident. A Reuters analysis shows that over the past 2 years GM has surpassed Ford in pretax profit per vehicle in North America. In 2016, Ford made $2,981 per vehicle, calculated by dividing pretax earnings by the number of vehicles sold, compared with $3,044 for GM. And GM plans to solidify that lead by rolling out a volley of new models aimed at the heart of Ford’s lineup. GM has invested billions of dollars over the past 3 years to overhaul many of its best-selling pick-up and SUV models, including the full-size Chevrolet Suburban and Cadillac Escalade SUVs that dominate their sector and typically boast pretax margins of $20,000 or more. GM also has boosted its share of the U.S. pick-up market with the 2014 launch of the mid-size Chevrolet Colorado and GMC Canyon. Ford’s rival to the Colorado, an all-new Ranger pickup, is not expected to debut until early 2019. Over the past 5 years, both companies have spent roughly the same (about 8 percent to 10 percent of revenue) on capital equipment, engineering, and research and development, Reuters analysis shows. But GM has brought far more new and redesigned vehicles to market in the United States in the past 3 years. “GM seems to be getting more for its money and realizing the results sooner”, said Joe Langley, an analyst with IHS Markit. Earlier this month, Ford’s U.S. sales and marketing chief Mark LaNeve acknowledged the company had missed an opportunity by “not participating in” the midsize pick-up and compact crossover segments where GM is well positioned. Ford also has lagged in redesigning its 8 year old Expedition and Navigator SUVs, which go up against GM’s Suburban and Escalade, and finally will be overhauled this fall. One of the biggest challenges for Ford will come next year, when its market-leading F-150 truck will be challenged by GM’s redesigned Chevrolet Silverado and GMC Sierra pickups. A year after that, GM is expected to launch new heavy-duty editions of the Silverado and Sierra to challenge Ford’s F-Series Super Duty, which is one of the industry’s most profitable vehicles. Altogether, GM plans 5 launches in 2018 and 8 in 2019, according to industry sources familiar with the company’s plans. In comparison, Ford expects to unveil only 2 redesigned vehicles in 2018 and will only reach some kind of parity with 6 launches in 2019. +++

+++ The LAMBORGHINI Huracán Performante made a splash when it knocked the Porsche 918 Spyder from its throne as the quickest production car around the Nürburgring. But the Huracán Performante didn’t accomplish the achievement with hardcore weight stripping, a hybrid powertrain, or forced induction for that matter. Instead it was active aerodynamics that unlocked potential for the 6:52.01 lap time. Now, Lamborghini has hinted that a more hardcore Huracán may be on the horizon. Lamborghini research and development chief Maurizio Reggiani believes there’s potential for an even faster, quicker, and hotter Huracán in the future. When asked if he could envision a limited-run of Huracáns sans luxuries such as carpeting, less sound deadening material and other facets, he simply replied, “Maybe”, in a suggesting tone. “We have some ideas for the future, for sure”, he said. “When we did the Gallardo Superleggera, the step between the normal Gallardo and this car was really high in terms of comfort and noise and stone chipping and stuff; but with the Huracán Performante you can use outside in Strada (street mode) and not perceive any deterioration of the comfort of this car”. Reggiani admitted that the Huracán was envisioned and designed to retain driveability in nearly every situation. Translation: even the Performante variant should keep drivers relatively comfortable, despite its achievements at the ‘Ring. However, it only adds to the speculation a more hardcore Huracán is possible. Although the Lamborghini Huracán Performante was technically outgunned by the Nio EP9 (an all-electric Chinese supercar) no one is calling it a production car since so few are being built and each of them are highly specialized. The EP9 may be street-legal, but the Huracán Performante’s blazingly quick lap is still record-holding in the industry, at least in terms of production cars. Maybe we’ll see an Huracán Superleggera mix it up down the road. +++

+++ Out is the news that Geely Holding will acquire controlling interest in British sports car maker LOTUS . While some 20 years ago the Chinese acquisition of a British automaker might have inspired grumbling from aggrieved Brits (and the handful of Lotus enthusiasts), the world has moved on. And so, thankfully, can Lotus. To suggest Lotus’ business history has been checkered is to broaden the definition of “checkered.” With its beginnings in the early ’50s as a maker of component cars for competition, Lotus founder Colin Chapman (in a manner not unlike his postwar contemporary, Enzo Ferrari) was always hustling, living a hand-to-mouth existence in the production of road cars to support a racing program. Regrettably, Chapman never found a Fiat, as Ferrari did toward the end of the 1960s. Lotus had Ford in its corner for racing and as a resource for powertrains, and later benefited from the corporate support of both GM and Toyota for relatively short periods. Lotus Cars, however, never enjoyed the corporate buy-in that would have allowed Chapman to race and let someone else build the cars. Regardless of what Consumer Reports or Kelley Blue Book might have thought (if they had …) about those early Lotus cars, a great many are now regarded as classics. My first knowledge of a production Lotus was when Tom McCahill, the ‘dean’ of automotive journalists in the US, tested an early Elan for Mechanix Illustrated. While we’re still not sure, some 50 years later, how McCahill’s XXL frame fit into the tiny roadster, he had nothing but praise for the Elan’s athletic chassis and now-timeless design. In today’s Lotus portfolio, the Elise and Exige continue that light, athletic tradition, while the larger Evora seems to strike wide (literally and figuratively) of the “less is more” ideal. With the Toyota-powered Evora, more is more. But in an eco-sensitive era demanding more of the original Chapman mantra (add lightness) there’s little reason that Lotus can’t regain relevance if given the financial resources. Geely’s acquisition of Volvo, the fruits of which appear regularly not only in the news but on the streets, suggests the Chinese investment will provide strategic vision (along with money) while allowing Lotus talent to do what it does best: Create an exciting product. And while at various periods in its history the product has been worthy, Lotus in the US has been ill-served by a flailing dealer network. If Geely’s success with Volvo is a guide, its acquisition of Lotus could be a lifeline. And for those with a love of driving (and little use for autonomy) it could not have come at a better time. +++

+++ According to German media reports, American president Donald TRUMP condemned Germany as “very bad” for its trade policies in a meeting with European Commission President Jean-Claude Juncker, signaling he might take steps to limit sales of German cars in the United States. “The Germans are bad, very bad”, he reportedly told Juncker. “Look at the millions of cars that they’re selling in the USA. Horrible. We’re gonna stop that”. White House economic adviser Gary Cohn confirmed the reports. “He said they’re very bad on trade, but he doesn’t have a problem with Germany”. Cohn said Trump had pointed out during the meeting that his father had German roots in order to underscore the message that he had nothing against the German people. Trump’s spokesman Sean Spicer said Trump had “tremendous respect” for Germany and had only complained about unfair trade practices in the meeting. Juncker called the reports exaggerated. The reports translated “bad” with the German word “boese,” which can also mean “evil,” leading to confusion when English-language media translated the German reports back into English. “The record has to be set straight”, Juncker said, noting that the translation issue had exaggerated the seriousness of what Trump had said. “It’s not true that the president took an aggressive approach when it came to the German trade surplus. He said, like others have, that the United States has a problem with the German surplus. So he was not aggressive at all”, Juncker added. In January, Trump threatened to slap a 35 percent tax on German auto imports. “If you want to build cars in the world, then I wish you all the best. You can build cars for the United States, but for every car that comes to the USA, you will pay 35 percent tax”, he said. “I would tell BMW that if you are building a factory in Mexico and plan to sell cars to the USA, without a 35 percent tax, then you can forget that”. Last year, the U.S. trade deficit with Germany was nearly $65 billion. But Trump seems to be ignoring (or unaware of) the fact that many German cars are made within the United States. BMW, for example, established a plant in Spartanburg in 1994, where it builds more than 400,000 cars a year, many of them for export from the US, which actually lowers the trade deficit. Trump, asked by reporters in Taormina whether he had accused Germany of being “very bad” on trade, did not respond. +++

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