+++ The AUDI brand beat its 2017 results by 10.9 % in August with around 153,900 premium automobiles sold. Among the core regions the number of deliveries grew most strongly in Europe (+21.5 %). Here the deliveries of models in stock as part of the switch to WLTP and model changeovers continued to have a positive effect on the sales figures. North America (+5.1 %) and China (+6.0 %) also saw positive growth in the past month. Audi delivered more than 1,268,550 automobiles to customers (+5.5 %) since January. “The renewed increase in deliveries underscores the Audi brand’s appeal. At the same time, we continue to focus on the difficult next few months with the switch to WLTP and the model initiative”, says Bram Schot, interim CEO and Board member for Sales and Marketing at Audi. “In addition, we are ushering in a new era for our company with our first fully electric car, the e-Tron”. The e-Tron will be celebrating its world premiere on September 17 in San Francisco. Through 2025 more than 20 new electrified automobiles will be augmenting the portfolio of the 4 Rings. Total sales for the month in the region of North America proved positive, with around 25,400 deliveries representing an increase of 5.1 %. Cumulative sales of around 183,550 Audi cars since January are up 4.6 % year-on-year. Audi’s SUV models continue to be very popular with customers in the United States. Demand across all sporty off-roaders increased by 20.9 % in the past month. The Q5 warrants particular mention, with sales up 42.9 % to 6,812 units in August. Furthermore, Audi delivered around 1 out of every 3 Q7 models produced to an American customer since January. Across the entire product range, demand from Audi of America performed positively in August (+5.5 % to 20,907 cars). In Europe, the premium manufacturer continued to benefit from the extraordinary effect of deliveries of models in stock as part of the switch to the WLTP test cycle and the model initiative (+21.5 % to around 60,200 units). As stocks are sold off the impact of this trend is diminishing. The new WLTP test cycle came into effect on September 1. Automakers can now only register their automobiles based on the previous NEDC test cycle with special approvals, depending on the legislation in the particular country. The 3 largest European markets reported strong growth with deliveries in August. The UK saw sales increase 19.5 % to 7,523 cars, sales were up 66.1 % to 5,305 cars in Spain, while sales rose 17.7 % to 22,216 cars in Germany. In China, Audi benefited from its local premium compact segment last month, with dealers delivering 8,299 A3 models, a year-on-year increase of 15.3 %. 14,857 Chinese customers opted in August for the A4 which is also produced in the Middle Kingdom, equivalent to an increase in sales of 29.5 %. Sales of all Audi models in China increased by 6.0 % to 57,453 units last month. As such, the company achieved its strongest August result in its history. In the year to date, Audi also set a new record with 417,234 cars delivered and an increase of 15.8 %. +++ 

+++ Volkswagen wants a new industry standard for AUTONOMOUS tech. The company is reportedly pitching the industry alliance as a way to share costs and mitigate liability issues. Volkswagen Group is reportedly pushing to create a broad alliance for autonomous technology, aiming to develop a new industry standard that can be shared between rivals. The company’s sales pitch centers around cost sharing and mitigation of liability when autonomous cars are involved in accidents. “How do you create an industry standard? Ideally by getting others to use the same sensor kit and software, so for that reason an overarching cooperation between automakers is one of the options we are examining”, a spokesman said. “The question is: How do we bring products to market that guarantee we made ourselves as small a target for damage claims as possible?” The company is apparently aware of the challenges in convincing competitors to join a consortium and manage collaboration between engineering groups from each player. Obviously, automakers that have committed the most development resources to autonomous technology (and may be ahead of VW in the race) will be reluctant to sign up. If VW succeeds, the alliance would focus on developing open-source technology with no restrictions on implementations and shared validation data. The German automaker has reportedly dismissed suppliers’ proposals to license “black box” solutions that enable autonomous functions but do not allow automakers to access the core technology. Volkswagen is said to be involved in discussions with 15 different companies. +++

+++ CADILLAC has put the development of diesel engines on hold, as the wider industry pushes toward hybrid and pure-electric vehicles. Steve Carlisle, president of Cadillac, said “markets may be changing more quickly” than the company first anticipated. “Going forward, we will focus on electrification”, he told. Cadillac was caught unawares by the Volkswagen diesel scandal in 2015, but executives felt they were too far along the development path to abandon ship. The sale of Opel last year also hit Cadillac’s diesel program hard, given the 2 brands were collaborating. Both 4 and 6 cylinder engines were reportedly being developed. Carlisle didn’t write the fuel off altogether, suggesting it’ll still play a role going forward; especially in large cars, SUVs and pick-ups. Central to the desire to push into diesel technology was the drive to conquer Europe. The compact XT4 SUV was meant to offer a diesel variant by 2020, but there’s no longer a guarantee that’ll happen. The range-topping CT6 is offered with a plug-in hybrid powertrain at the moment, pairing a 2.0-litre turbocharged petrol engine with an electric motor for 50 km of battery-only driving. That’s the same approach taken by Volvo with its T8 Twin Engine hybrid setup. It’s offered on models ranging from the V60 to the XC90, and is designed to deliver big-engine performance with small-engine economy. Porsche has dropped the diesel Panamera in favour of a plug-in hybrid, while 48V mild-hybrid technology is allowing brands like Audi and Mercedes-Benz to extract better-than-ever numbers from their petrol-powered cars. +++ 

+++ Workers at JAGUAR LAND ROVER ’s production facility in Castle Bromwich have been told they will be moving to a 3-day working week. The West Midlands factory, which produces the Jaguar XE, XF and XJ saloons alongside the F-Type sports car, will reduce output until the Christmas period. The fall in production can be attributed to a decline in sales of Jaguar’s 4-door models, owing to ongoing Brexit uncertainty and the slump in demand for diesel vehicles. Moving to a 3-day week will reduce the likelihood of further job losses, after it was announced in April that 1.000 agency staff would not have their contracts renewed at JLR’s Solihull plant. The car maker employs 40.000 people across the UK, with many more jobs linked through suppliers. Last week, JLR CEO Ralf Speth condemned the lack of certainty in the market, saying that “tens of thousands” of jobs could go at the firm if the right Brexit deal is not secured. Earlier this year, the company announced reduced production at its plant in Halewood, Merseyside, where models such as the Range Rover Evoque and Land Rover Discovery Sport are built. A Jaguar spokesperson issued a statement saying that the reviewing of production schedules is “standard business practice” to ensure balanced market demand. “In light of the continuing headwinds impacting the car industry, we are making some temporary adjustments to our production schedules at Castle Bromwich”, said the spokesperson. “We are, however, continuing to over-proportionally invest in new products and technologies and are committed to our UK plants in which we have invested more than £4 billion since 2010 to future-proof manufacturing technologies to deliver new models”. +++ 

+++ KIA has yet to decide whether or not to invest in next-generation diesel technology, as demand at the black pump continues to plummet. The Korean firm still sees diesel as an important fuel for many car buyers, not only in emerging markets where it can remain dominant but also for buyers of larger cars such as SUVs in more developed regions where the fuel is most under attack. Kia’s chief operating officer, Ho Sung Song, said that the firm was now mulling whether to invest in the next generation of diesel complying with Euro7 rules, whose implementation date or standard has yet to be determined. However, he said Kia had not yet made a decision and one wasn’t necessarily imminent. Song believes that the worst of the big slump for diesel was over, and that things should now stabilise. Indeed, he pointed out that buyers could even return to the fuel given its better economy, when much of the alternative remains downsized turbocharged petrol engines that are among the least impressive for real-world fuel economy compared with official figures. Song also said much of the conversation was about NOx emissions, and CO2 needed to be factored back into the argument. Kia is committed to 19 new electrified models or variants by 2022, a strategy that majors on plug-in hybrids in Europe as flagships and parallel hybrids in the US in addition to more dedicated electric cars such as the Niro EV. The new Ceed has launched with diesel engines in addition to petrol, but that car will be offered in electrified form by the midway point of its 5-year life cycle. +++

+++ Uday Senapati joins LOTUS as Product Strategy and Product Management Director. The latest in a series of high profile appointments, Group Lotus is pleased to announce that Uday Senapati joins the iconic British sports car marque. The latest in a series of high profile appointments, Group Lotus is pleased to announce that Uday Senapati joins the iconic British sports car marque. Uday joins Lotus as the company undergoes the next stage of its growth and return to prominence, under the leadership of Group Lotus’ Chief Executive Officer, Feng Qingfeng. Further confirming the Norfolk brand’s commitment to excellence, and attracting new talent to Hethel. Well-known and respected within the industry, Uday will take responsibility for Product Strategy and Management for all current and future product lines, including digital products and services. Prior to joining Lotus, Uday started his career as an automotive engineer, specialising in automotive refinement, aerodynamics and vehicle engineering. Moving quickly into technical management roles at both General Motors and Jaguar Land Rover he most recently held senior management positions at Bentley. Speaking of the announcement, Feng Qingfeng welcomed Uday to the team, “With a wealth of experience in the automotive sector Uday has a proven record of leading successful teams in premium segment automotive companies. At Lotus he will take the lead in developing and delivering our product plans and he will play a vital role as Lotus continues to challenge conventions and innovate as it looks to the future”. Uday Senapati said, “Lotus has a tremendous sporting and racing heritage and is in the enviable position of having produced some of the world’s most iconic sports cars. To be able to work closely with some of the best people in the industry on bringing the next generation of advanced high-performance vehicles to market is immensely exciting and I’m looking forward to the challenges ahead”. +++ 

+++ Electric car start-up LUCID MOTORS has announced that it has secured in excess of $1 billion funding from the Public Investment Fund (PIF) of Saudi Arabia. This funding allows the brand to complete the required engineering development and testing, as well as build its first factory to produce the Air, an all-electric saloon, due in 2020. The factory will be located in Casa Grande, Arizona. The Air will mix sports car handling with the comfort of a luxury saloon, its marketing manager has claimed. It’ll be the brand’s first model, launching first in North America amidst a strategy aimed at propelling Lucid into becoming a global luxury electric car company. A spokesman for the PIF said: “By investing in the rapidly expanding electric vehicle market, PIF is gaining exposure to long-term growth opportunities, supporting innovation and technological development, and driving revenue and sectoral diversification for the Kingdom of Saudi Arabia. The fund aims to bring revenue back into the country in a world moving away from oil, and “aims to strengthen PIF’s performance as an active contributor in the international economy, an investor in the industries of the future and the partner of choice for international investment opportunities. Our investment in Lucid is a strong example of these objectives”. The initial investment would be of $500 million, with subsequent funding coming as Lucid achieves production milestones. In 2016, the company stated its ambition to begin production of its first model, the Air. However, it has since pushed that goal back to 2020 while it raises the necessary funds. The Air, which exists in prototype form, is a sporting luxury saloon that is claimed to offer a 640 kilometre driving range, up to 1.000 hp and a 0-100 km/h time of 2.5 seconds. The proposed price range is $60,000 to $100,000 (approximately €72,000 to €120,000 in The Netherlands). The Saudi Arabian fund is said to have reserves of around $250 billion and has been investing heavily in order to diversify the country’s portfolio away from oil. For example, it has sunk $45 billion into a multinational technology group, including Apple and Qualcomm, that will focus on artificial intelligence and robotics. Lucid was formed in 2007 under the name Atieva by Bernard Tse, a former board member and vice president of Tesla, and engineer Sam Weng. Its chief technology officer is Peter Rawlinson, a former head engineer at Jaguar, Lotus and Tesla. Lucid’s other connections include a battery supply deal with Samsung and development of technology for the next-generation Formula E car along with McLaren and Sony. +++

+++ Just over a month after Elon Musk’ s tweet suggesting that he had the “funding secured” to take TESLA private, the electric car maker faces a sober reality as it remains a public company: its stock and bond prices have plunged. Tesla’s $1.8 billion of high-yield bonds are trading near all-time lows, while its stock has fallen more than 20 % since Musk took to Twitter to broadcast his now abortive plan to take Tesla private. Shaken by the departure of Tesla’s chief accounting officer, the stock has endured a volatile time. That is a problem for the electric car maker if it has to turn to public markets to raise more capital in the near future. Having pioneered electric car technology, Tesla also faces a stronger commercial challenge from the likes of Jaguar (I-Pace), Mercedes (EQ C), Audi (e-Tron) and Porsche (Taycan). “It is more expensive for them to issue equity and it is more expensive for them to issue debt because people are losing their faith in Musk”, says a chief investment officer. That backdrop has helped short sellers, who bet on a decline in the company’s stock and bond prices. “Who is going to invest at this point?” says a short seller. “Musk emboldened the shorts”. He has consistently pushed back against claims that Tesla needs fresh funds. The billionaire CEO insists that the company, which previously bled $1 billion of cash per quarter, will swing to positive cash flow this year. “We’ll not be raising any equity at any point”, he said on a results call last month, adding that while Tesla “could raise money”, it did not need to. But Goldman Sachs and Moody’s disagree. Goldman reinstated its sell recommendation on Tesla’s stock, arguing “looming maturities” on Tesla’s convertible bonds mean the company will “likely need to come back to the capital markets” next year. Moody’s, which pegs Tesla’s debt in the triple-C bracket, also said last month that these $ 1.2 billion of convertible bonds maturing in the next 6 months would push the company to raise capital. “We continue to expect that Tesla will need to access the capital markets in order to fund its operating requirements and repay the maturing convertible debt obligations”, said the rating agency’s lead analyst, Bruce Clark. In the event the electric car maker does require fresh funding, it faces a more hostile market than it did before the take-private saga began. Tesla raised $250 million in equity capital in March of 2017, alongside $750 million of convertible debt, when its stock price stood at $260. A lower stock price means more shares will need to be sold to raise the same amount of money, diluting existing shareholders more and potentially sending the stock price even lower. “Musk’s latest actions question his ability as a leader”, added Clark. The debt market is not hospitable anymore. “The question is how to raise money. It’s going to be more expensive for them to issue debt”. +++ 

+++ The new car market in the UNITED KINGDOM experienced a sales surge of 23.1 % in August, as buyers descended on showrooms to take advantage of dealer offers ahead of new emission regulations coming into effect. And with all eyes on efficiency and emissions, sales of hybrid and plug-in hybrid cars rocketed by 88.7 %. August’s bumper sales are believed to have been caused by canny customers catching on to the fact many dealers were offering significant discounts on models not tested to the latest emission regulations. From 1 September 2018, new cars cannot be sold unless they were tested under the new WLTP regime, and this led many dealers to discount models tested under the old NEDC assessments. Buyers were clearly more than happy to take advantage of this anomaly, with 94,094 people signing on the dotted line for a new car in August, up from 76,433 in August 2017. Sales of alternatively-fuelled vehicles (AFVs; essentially hybrids and plug-in hybrids PHEVs) grew by 88.7 %, with 7,489 AFVs finding homes in August. But while AFVs now make up 8 % of the new car market (up from 5.2 % in August 2017) diesel sales were down 7.7 %. Dieselengined cars now make up 29.7 % of the market, a 10 % fall since August 2017. The popularity of petrol-powered cars grew by 7 % between August 2017 and 2018, with cars running on unleaded now accounting for 62.3 % of all new models. And while 23.3 % more private buyers bought a car in August 2017 compared to the same month in 2017 (and fleet sales were up 19.7 %), sales to business users shot up by 166.4 %. The business sector may be small (with 2,499 sales in August 2018), however this sector has more than doubled its market share, to 2.7 %. While August was a busy month for dealers, the Society of Motor Manufacturers and Traders (SMMT) warned the sales surge does not represent a true market boom. Mike Hawes, the SMMT’s chief executive said: “It’s great to see such strong growth, particularly in the important electric vehicle market. However, given August is always a small month in new car registrations ahead of the important plate-change”. The SMMT also highlighted while it is on-track to meet forecasts for 2018, the new car market is down 4.2 % year-on-year after a “turbulent” 8 months. With that in mind, industry eyes will be on September’s sales, with August’s sales surge potentially preceding a market correction. The Ford Fiesta retains the top spot for sales, with 4.552 registered. Regular challengers such as the Volkswagen Golf, BMW 3 Series and Nissan Qashqai remain in the top10 too. New entrants also feature, such as the Suzuki Swift and Honda Jazz. An exceptional number of discount deals in the past month is another reason cited for the sharp increase. It comes after several months of market unrest, which saw UK car registrations down 6.3%. June witnessed the lowest number of new cars registered since 2014, although a small amount of growth was measured in June. Much of this year’s car market issues in Europe is due to an ongoing slump in demand for diesel, driven by uncertainty over the fuel’s future and fears of increased taxation to come. +++ 

+++ VOLKSWAGEN will launch its forthcoming I.D. hatchback with a range of 3 battery capacities and the firm is setting ambitious sales targets for the electric sub-brand of 100,000 cars per year in 2020 and 10 times that figure just 5 years later. The first I.D. will be a 5-door hatchback roughly the same size as a current Golf, but using the all-new MEB ((Modular Electric Drive Matrix) platform’s unusually long wheelbase to offer the same interior space as a Passat. VW has now confirmed more details of the platform and how it will be rolled out when the I.D. hatch (codenamed Neo internally, although there’s no confirmation on whether that badge will be used in production) goes on pre-sale before the end of 2019. Christian Senger, VW’s Head of Product Line for E-Mobility, told: “We will have 3 different ranges of I.D. hatchback, to allow for people with different budgets. The entry-level car will have a WLTP range of 330 km, and it will also have more limited performance. If people want a faster car then I don’t want them coming back after 3months telling me that it’s fast but that the range is too short. So if you want a fast car, you’ll need a bigger battery – simple”. Te most modest I.D. hatch will get a 48 Wh battery and that it will be available for the price of a well-specced diesel Golf. Senger added: “For the mid-spec, we have actually exceeded our target, which was 400 km. It’s more than that: closer to 450 km. And we’re still finalising what the range-topping battery capacity will be”. The first details of the new MEB platform show that it has a relatively long wheelbase on even the I.D. hatchback: around 2.83 metres, or more than 20 cm longer than a current 5-door Golf’s. The car will offer 2 forms of AC charging (7.2 kW and 11 kW) plus DC charging at up to 125 kW, the maximum that can be achieved with the car’s 400-volt electrical systems. Senger said buyers should expect a less complex buying or leasing process with I.D. cars; not least because the company has removed many of the intricacies of combustion-engined line-ups in a bid to raise economies of scale and cut costs. “There will still be enough versions of I.D.”, he told, “but it will be much less complex, yes. You’ll still be able to choose different colours and specs of seats, but you won’t get the thousands of permutations that come with, say, a combustion-engined Golf. Complexity costs, and you have to remember that our goal with I.D. is Electric for All”. The prototype platform shown at VW’s launch event revealed predictably short overhangs for a car that doesn’t have a combustion engine or an exhaust, and a multi-link suspension arrangement at the rear to accommodate the electric motor. I.D. models will be able to be offered with a second electric motor at the front, for four-wheel drive, but there are no plans at present to make this available on the initial hatchback model. It will be introduced, therefore, on the SUV that’s likely to follow within a year of its launch. The chassis also includes a large area ahead of the dashboard (space freed up by the lack of a combustion engine) that VW will use to install a projection system for an augmented reality navigation display. This was previewed on the original I.D. concept but the bare chassis indicates that it is likely to make production, at least as an option. There’s also a gap where an induction charging panel could be installed, as and when the technology becomes available. The I.D. will be VW’s first permanently online vehicle, allowing a range of services to be offered to customers through the cloud, and over-the-air updates to be installed in the same way as Tesla does with its cars. Only 3 of the car’s electronic control units (ECUs) are unable to be updated wirelessly. Senger revealed that VW had even considered installing one set of hardware and allowing the user to activate or deactivate features via smartphone apps but he said, “We did the numbers and it was still too expensive. You can’t just put heated seats in every car and then charge some people for them; the unit cost is too much”. VW confirmed today that the I.D. hatch will be built at its Zwickau factory, and stated that it is investing €1.2 billion in the plant. The company says that the factory will be able to produce 1,500 I.D. cars per day, although Senger said that this full capacity wouldn’t come on stream until 2021. VW says that across the wider group (so including its own brand plus Audi, Seat and Skoda) it expects 27 pure-electric MEB models to be on sale by the end of 2022. And that in total, 10 million vehicles will be based on the first wave of the MEB platform, which has been conceived from the ground up to accommodate batteries and electric motors, with no compromise for combustion-engined variants. The company has also detailed how other production sites in Germany are being adapted for MEB. The battery systems factory in Braunschweig will expand to capacity for half a million battery packs per year, while the facilities at Salzgitter (rotors) and Kassel (electric motors) will also receive fresh investment. VW says it plans to spend €1.3 billion across these 3 sites. VW has revealed that a prototype production version of the car is currently under preparation in its ‘Pilot Hall’ in Wolfsburg, and that it will soon begin tests at the firm’s top-secret Ehra-Lessien proving ground in eastern Germany. The car should be revealed in full in the final quarter of 2019, although UK sales aren’t likely until early 2020. Volkswagen is also premiering its new Wallbox home charging system. All vehicles will be capable of accepting rapid charging, taking an 80 % charge in 30 minutes. As part of its ‘Electric for All’ campaign, the Volkswagen brand aims to sell 150,000 electric cars including 100,000 ID models made in Germany by 2020. 10 million vehicles will be produced in the first product life cycle, “creating massive economies of scale”. +++

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