+++ Everyone seems to know that the ALFA ROMEO Giulia has been recently experiencing problems. Turns out, the blame goes to Giulia’s software. Reid Bigland, big time executive from Alfa Romeo and Maserati, finally responded with an apology after Sam Smith, Road & Track’s editor-at-large published an article bearing the headline “Alfa Romeo Is Its Own Worst Enemy”. Under the main title, Smith had written “How one of the greatest brands in automotive history might squander what goodwill it has left”. Apparently, the issue began after the media publication’s test car struggled to make it through one lap at the Gingerman Raceway earlier this week. According to Bigland, the problem was caused by the vehicle’s software, saying that the car was shipped directly from the factory without going through the standard dealer inspection procedure. As a result of this, several software updates must have been missed in the process. If Bigland’s statement is later proven to be correct, then we have found the answer to the malfunctioning engine lights and sunroofs that used to plague Alfa Romeo Giulia in the last 2 years. Regardless, the negative publicity has somehow brought damage to the company’s reputation which isn’t a good thing considering Alfa is currently establishing itself in North America. To compensate for this, Bigland highlighted the overall positive reviews that the car has received from other journalists including the 70 awards it won in the previous years. In his response to Smith’s criticism, Bigland said he couldn’t even recognize the car as the type of Alfa Romeo he’s familiar with. That said, Bigland honestly thinks they can do far better than not being able to run a single lap. Alfa Romeo’s executive added that the Giulia’s mechanical underpinnings are in fact very solid. Thus, any unfortunate encounter points all the way back to the software issues which have been already resolved by the company. Nevertheless, Bigland expressed his own disappointment into to how a missed software update could overshadow the car’s strong potentials. It is worth noting too that the all new Giulia has earned serious accolades following its launch almost 2 years ago. Just the same, building up its reputation after a criticism is still very important if they wish to go head to head with the likes of Mercedes, Lexus and BMW. In fact, the Giulia QV’s 510 hp matches the total output coming from a Mercedes Benz C63 AMG S. This only goes to show that its major rivals should also include Cadillac’s ATS-V, the Audi RS4 and BMW M3. The only question is, has Alfa Romeo finally put an end to these pesky software bugs? +++
+++ FIAT CHRYSLER Automobiles (FCA) reported slightly better than expected second-quarter earnings, helped by improvements in Europe and Latin America and continued strong performance in its main North American market. However, the carmaker’s net industrial debt only fell to 4.2 billion euros at the end of June from 5.1 billion euros 3 months earlier, whereas analysts had been expecting a decline to 3.9 billion. “It’s good to see the strong margins from North America and Latin America turning a profit but the market had expected they would have cut debt a bit more”, one analyst in Milan said. FCA has been retooling some U.S. factories to boost output of SUVs and pick-ups while discontinuing production of some unprofitable sedans in a bid to strengthen its finances as the U.S. car market comes off its peak. The world’s 7th-largest carmaker still makes the lion’s share of its profits in North America so improving, or at least maintaining, its margins there is a key focus for Chief Executive Sergio Marchionne. The company said its adjusted operating profit margin in the region rose to a record 8.4 percent from 7.9 percent a year earlier, despite a drop in sales and shipments. The company said adjusted earnings before interest and tax for the April-June period rose 15 percent to 1.87 billion euros, above a 1.81 billion consensus forecast in a Thomson Reuters poll. Profitability also improved in Europe, helped by sales of Alfa Romeo’s Giulia and Stelvio models, while margins at luxury brand Maserati more than doubled to 14.2 percent on the back of strong demand for its first SUV, the Levante. Revenue was flat at 27.9 billion euros for the quarter, slightly below an average forecast of 28.9 billion euros. FCA confirmed its target to nearly halve net debt this year from 4.6 billion at the end of 2016 and increase its adjusted operating profit by at least 15 percent. Doubts remain, however, about its exposure to the weakening U.S. market recall costs and potential fines over emissions. +++
+++ Although some automakers, notably Tesla, have been utilizing over-the-air (OTA) updates for years in its vehicles, many others have shied away from the technology. But, as security increases and costs decrease, automakers are slowly adopting the technology. GENERAL MOTORS is on deck. CEO Mary Barra told investors the automaker will begin OTA updates by 2020. Per Barra, General Motors is currently in the process of rolling out a new electrical architecture alongside a new generation of infotainment systems, which will usher in OTA-update capability. “You’ll see us have (over-the-air) capability as we move forward”, Barra said. General Motors has dipped into the OTA realm, but only through its OnStar subscription service to implement updates. Future OTA capability will be able to update infotainment and mechanical systems, much like how Tesla’s updates work currently. The technology has benefits for automakers and customers. Automakers are able to push out updates to infotainment and mechanical systems in real time and there is no need for a customer to take a vehicle to its appropriate dealership for service. Updates will only become more important as self-driving cars and autonomous driving technology become more prevalent. In regards to General Motors, it will launch its first foray into self-driving technology with its Super Cruise system, which will debut with the Cadillac CT6 later this year. The system will be capable of handling all controls during highway driving but it can not be engaged on local streets. +++
+++ MCLAREN has just launched the 720S and it’s certainly an impressive bit of kit. But there’s a lot of white space above the Ferrari 488 and Lamborghini Huracán rival that McLaren could fill until a replacement for the P1 finally arrives. McLaren has been working on a model to sit above the 720S for several years. Code-named the P15, the car is designed to go up against the Ferrari 812 Superfast and Lamborghini Aventador and will sit in McLaren’s Ultimate Series. The flagship range currently consists of the P1 and P1 GTR. The P15 will be shown in 2017, though likely only privately. A public debut will likely follow in early 2018, which suggests a 2018 Geneva auto show debut. The P15 is said to be the fastest McLaren road car to date, eclipsing even the performance of the P1. It’s also said to be the most track-focused McLaren road car to date, although it won’t outmatch the track-only P1 GTR. For well-heeled McLaren buyers that aren’t enticed by the idea of a track-focused Ultimate Series member, there will be the BP23 arriving in 2019. This is billed as a spiritual successor to the F1 and will even come with the famous 3-seat, central driving layout. The basis for the car will likely be McLaren’s MonoCage II carbon fiber tub that debuted in the 720S. Also borrowed from the 720S should be a 4.0-liter twin-turbocharged V-8. Peak output will be around 800 horsepower. That’s down on the P1’s 912 horses, but without the need of a heavy hybrid system the P15 should tip the scales at less than 1,300 kilos, compared with 1,530 kilos for the P1. Expect the design to be “brutal”, one source told. Almost every element will be there for function only. Handling the design is new McLaren design boss Rob Melville, the person responsible for the stunning 720S. Expect aggressive aero incorporating active elements. Just 500 are thought to be planned, and given the extreme nature of the car we’re unlikely to see more potent versions like an LT. We could, however, see a track-only version using McLaren’s GTR badge. +++
+++ Following MERCEDES ‘ shock decision to pull out of DTM (German Touring Car Championship) in favor of a factory Formula E team, Audi and BMW said they’re considering pulling out of the sport too. Consequently, DTM could be in serious trouble. The DTM series consists of Mercedes-Benz, Audi, and BMW. Mercedes-Benz’s exit after the 2018 season will leave just 2 factory DTM teams, which also occurred in 2007 when BMW pulled out of DTM only to return 5 years later. This time is much different: if Audi and BMW exit it’s unclear who would replace those teams. “We regret the decision of Mercedes-Benz to retire from DTM after the 2018 season”, said Audi motorsport boss Dieter Gass. “The consequences for Audi and the series are not clear at the moment. We now have to analyze the new situation with everybody involved in order to find a solution or possible alternatives to DTM”. BMW motorsport chief Jens Marquardt echoed Audi’s sentiment. “It is with great regret that we acknowledge Mercedes’ departure after the 2018 DTM season. We now need to evaluate this new situation”. Should either BMW or Audi decide to also exit DTM, it could pen the final chapter for DTM’s iconic and storied motorsport history. On the opposite side, Mercedes-Benz’s decision to enter Formula E shows how important the motorsport is becoming to automakers. Porsche and Ferrari have both hinted at joining the motorsport, and BMW will join for the 2018 season; Audi already races in Formula E. +++
+++ PORSCHE ’s storied run in the World Endurance Championship may be sprinting toward its ultimate demise. Earlier this month it was reported that the automaker may leave the race series in favor of joining Formula One. An official announcement from Porsche could come within 24 hours. Porsche’s board met Wednesday to determine the LMP1 program’s fate, and the likely result was to shutter the program. The program reportedly costs $200 million annually. But cost may not be the main reason for Porsche’s exit. The automaker has considerably tightened its belt after an emissions scandal rocked parent-company Volkswagen, and also the coming changes in regulations may push Porsche out the door. Porsche LMP1 team principle Andreas Seidl told that a decision regarding the fate of the Porsche LMP1 program would come by the end of this month. Even Porsche LMP1 factory driver Andre Lotterer told DH.be he’s expecting the worst for the program. If Porsche exits LMP1 this year, following Audi’s exit last year, that would leave Toyota as the sole automaker participating in the class. Regardless of the outcome, it’s clear a shift in racing is coming, and Porsche’s return a few years ago to LMP1 might be shorter lived than expected. +++
+++ TESLA ’s luxury sedan is back in the good graces of Consumer Reports. The Model S regained its status as the magazine’s top-rated, ultra-luxury sedan after Tesla updated its software to include automatic emergency braking at highway speeds, Consumer Reports said. The car got an over-the-air update that set the upper limit of the advanced driver-assistance feature back to 145 km/h, like the Model S versions built before October 2016. The magazine had lowered its Model S safety scores in April for the newer versions of the sedan and the Model X, Tesla’s luxury SUV, because they didn’t have their AEB system enabled as part of a standard package. The magazine awards extra points to vehicles that have AEB as a standard feature for all trims, it said. Tesla began a rollout of AEB in April, but the update activated the feature on vehicles up to 45 km/h; later that month Tesla said that AEB would eventually work at highway speeds, “which led to the recent update”, Consumer Reports said. In May, the magazine said it would revise scores once the feature worked at highway speeds. The Model X also regained some points, “but those did not lift it very much in its category, where it resides near the bottom”, Consumer Reports said. The SUV last month won top marks from U.S. regulators, which bestowed the highest safety marks on tests that included frontal crashes, side crashes, and rollovers. The Model X was the first SUV to achieve an all-around five-star rating with the National Highway Traffic Safety Administration, the company said at the time. +++
+++ VOLKSWAGEN raised its 2017 sales forecast after cost cutting and higher margin new models at its namesake brand helped it to beat quarterly profit expectations. Europe’s largest automaker said it now expected revenue to beat last year’s record 217 billion euros by more than 4 percent, compared with up to 4 percent previously. Earnings before interest and tax jumped to 4.55 billion euros in the second quarter from 1.90 billion a year earlier, beating the average forecast of 4.49 billion euros in a Reuters poll of analysts. Profits at its largest revenue generator, the long struggling VW brand, climbed 12 percent to 907 million euros, thanks to cost cuts, R&D and production improvements and the launch of several high-margin SUVs. Investors have said a turnaround at the VW brand, which has suffered from high production costs in Germany and excessive R&D spending, is key to reviving the group’s fortunes following a costly emissions test cheating scandal. The brand’s quarterly operating profit margin also leapt to 4.4 percent from 2.9 percent a year ago, beating a 2020 target of at least 4 percent, though still lagging peers such as PSA and Renault. “I am firmly convinced that our financial footing is adequate to cope with the transformation in the automotive industry and topics of the future”, finance chief Frank Witter said, a day after Britain announced a ban the sale of new petrol and diesel cars from 2040 to reduce pollution. In another sign that VW is on the mend, it did not announce any further provisions related to its cheating of U.S. diesel emissions tests. The group has to date set aside 22.6 billion euros to cover fines, compensation and vehicle refits. VW’s recovery, however, has been clouded by news that European and German regulators are investigating allegations of decades-long collusion between VW and other German carmakers. VW played down the controversy after a special supervisory board meeting, saying cooperation on technical issues was a common industry practice. It declined to comment on allegations of anti-competitive conduct. +++