+++ Mercedes – AMG has started phasing out the V12 engine from its line-up. The firm has already dropped the V12 powered variants of the G Class and the SL from its portfolio. The only AMG-badged, V12 powered cars left are the sedan, coupe, and convertible versions of the S 65. They’ll retire without a successor. “We are going to move the S 65 out of our portfolio”, confirmed AMG boss Tobias Moers in an interview. Moving forward, AMG’s range-topping models will use a V8 electric powertrain that the firm’s engineers are currently developing. Previewed by the 2017 GT concept, the 805 horsepower setup consisted of a twin-turbocharged, 4.0-liter V8 and a powerful electric motor. Moers previously confirmed that “everything is in development” and that the specs will be “more or less” the same. Moers said it’s difficult to predict when (or if) Mercedes will need to phase out the V8 in the name of pollution regulations. The current 4.0 liter unit that powers a wide number of cars ranging from the GT to the G-Class will stick around in the foreseeable future, however, and teaming it with electric motors could extend its life. “In combination with an electrified powertrain, it could be a longer life cycle than what everybody thinks”, he said. “I am not so confident with having a 10-year plan and strategy because the world we live in is too fast. You have to adjust your strategy and your targets almost every year, half a year”, he added. +++

+++ The interim CEO of Volkswagen’s AUDI unit, Bram Schot, laid claim to the top job for the long term, amid uncertainty when a prospective new hire from BMW, who has been seen as Audi CEO designate, can join Volkswagen. “I would be available as Audi chief in the long run and would like that very much”, Schot said in an interview. The sales executive was promoted to interim CEO in June after incumbent Rupert Stadler was arrested for his alleged role in bringing diesel cars with devices to cheat emission tests to European markets. In July, Volkswagen recruited BMW engine development and purchasing expert Markus Düsmann, who has been seen as a potential successor to Stadler, as VW looks to shake off the scandal. But Düsmann’s current BMW term runs until September next year and he is contractually banned from working for a competitor such VW for one year thereafter. An earlier release would be subject to negotiations with BMW. Unspecified sources said BMW was not willing to make concessions. Schot also said in the interview that Audi’s supervisory board had not imposed any restrictions on him and that he was making decisions for the company for the short, medium and long term. The feedback he receives from co-workers is positive, Schot said, adding: “They don’t give me the feeling that I am seen as an interim solution”. +++

+++ BMW offered the original 8 Series with a V12 engine. The born-again model scheduled to arrive in showrooms in 2019 won’t receive anything bigger than a V8, according to one of the company’s top officials. “The V12 is very heavy and we have a perfect weight distribution with this car. So the package with the V8, with those technologies, with the chassis, and the drivetrain makes the car a proper sports car. In our opinion a V12 will be too heavy in the front,” explained Carsten Gröber, BMW’s vice president of product management, in an interview. Gröber added the 8 Series is unlikely to receive a plug-in hybrid model for the same reason. However, he conceded BMW could change its mind if it regulations or demand from buyers force the 8 into hybrid territory. “Never say never”, he summed up. At launch, the 8 Series will be available with a turbocharged, 4.4 liter V8 engine rated at 530 hp and 750 Nm. Installed in the M850i xDrive, the 8 Series will channel its output to the 4 wheels via an 8-speed automatic transmission. The line-up will later grow to include a range-topping, M-tuned variant named M8 and an entry-level model with rear-wheel drive. Europe will also get a turbodiesel model, the 840d. +++ 

+++ BMW will pay €3.6 billion to take control of its main joint venture in CHINA , the first such move by a global carmaker as Beijing starts to relax ownership rules for the world’s biggest auto market. The luxury carmaker said it would increase its stake in its venture with Brilliance China Automotive Holdings to 75 % from 50 %, with the deal closing in 2022 when rules capping foreign ownership for all auto ventures are lifted. The move will likely spur BMW to shift more production to China, helping to protect profits amid a whipsawing trade war between Washington and Beijing that has raised the cost of BMW importing cars manufactured at its U.S. plant in South Carolina. The deal also marks a milestone for foreign carmakers which have been capped at owning 50 % of any Chinese venture and have had to share profits with their local partner, and could encourage rivals such as Mercedes maker Daimler. “We are now embarking on a new era”, BMW Chief Executive Harald Krüger said in a speech in Shenyang, northeast China, where the joint venture is based. He thanked Chinese Premier Li Keqiang, whom he said “personally supported” the plan. Evercore ISI analyst Arndt Ellinghorst called the deal a major breakthrough. “In the future, BMW will have the full control over the biggest regional profit pool of its business”, he wrote. Beijing has been keen for global carmakers to invest more in China and has also eased restrictions that cap foreign ownership of electric vehicle businesses at 50 %. The joint venture plans to add a new plant, spending over €3 billion on a large-scale expansion of the existing production facility, Krüger said. Yale Zhang, head of Shanghai-based consultancy Automotive Foresight, said: “Others will follow over time, but the divorce schedule depends on how strong or capable the local partner is”.  Daimler’s Chief Executive Dieter Zetsche told last week that recent signals from the Chinese authorities were encouraging, but the German carmaker did not yet have legal permission to make a move. “If we do, we need to see what opportunities there are”, Zetsche said at the Paris Motor Show, adding any steps depended on talks with BAIC, Daimler’s partner in joint venture Beijing Benz. As trade tensions have escalated, China’s government has pledged to open up its markets more widely, including cutting taxes on imported vehicles, cancer medicines and a range of consumer goods. The country’s leaders have also played up other milestone deals such as German chemical maker BASF winning approval in July to build China’s first wholly foreign-owned chemicals complex. The rule changes have already helped Tesla gain Beijing’s approval for a wholly-owned manufacturing and sales company in Shanghai, the first time a foreign carmaker will be able to establish a full presence in China without a partner. BMW is one of the biggest exporters of vehicles from the United States to China, putting it firmly in the crosshairs of the trade war. “Given the trade dispute between the U.S. and China, there is a powerful incentive for automakers to produce vehicles in the market where they sell them”, said independent auto industry analyst James Chao. He said control of the joint venture could spur BMW to bring production of models like the BMW X4, X5 and X6, which are currently built in the United States, to China. But if the move is a big win for BMW, it spells a diminished role for its Hong Kong-listed partner. Brilliance, which makes the vast majority of its revenue from BMW-branded cars, has seen its shares tumble nearly 50 % this year on talk that such a deal was in the offing. Analysts say the deal will substantially decrease Brilliance’s long-term value. Brilliance Chairman Qi Yumin lauded the venture’s past success and said the future offered further opportunities. He added that while the situation was complex, the partners would need to “stick together through thick and thin”. A number of carmakers said earlier this year they had no immediate plans to change their Chinese joint venture structures despite the planned rule changes. But Chinese demand for mass-market passenger cars has fallen, increasing the dependence of some local players such as BAIC on income from ventures with premium brands like Daimler. Industry insiders and analysts fear sales could fall this year for the first time in decades. China auto sales dropped in July and August. BMW finance chief Nicolas Peter, however, said the firm remained bullish about its top market. “Number 1 reason why we invest in China is because we are absolutely convinced the market has a further growth potential”, Peter said in an interview. He said the firm was also investing in extra capacity in the United States. The term of the joint venture will also be extended to 2040 from 2028. +++ 

+++ Daimler is in talks with China’s GEELY Holding Group to set up a joint venture to offer ride-hailing and car-sharing services in China. The 50:50 venture is yet to be finalized, and Daimler is planning to take on industry leader Didi Chuxing on its home turf. “We have a constructive dialogue with our Chinese counterparts. I believe there is potential for both and there are more opportunities than risks. The situation is promising”, Daimler Chief Executive Dieter Zetsche said at the Paris Motor Show. Geely holds a stake in Daimler and has sought an alliance in the areas of electric and autonomous vehicle technologies. +++

+++ GENERAL MOTORS ‘ quarterly sales in China fell for the first time in over a year, hit by faltering economic growth and a wider slowdown in the world’s biggest auto market amid a whipsawing trade war with the United States. The U.S. carmaker sold 835,934 vehicles in the third quarter ended September, down a sharp 14.9 % from a year earlier, which the firm said was due to a “softening” vehicle market and issues shifting to a new engine system with its Buick brand. “The major reasons are a softening market, slowing lower-tier cities, Buick’s engine change-over and a strong Q3 last year”, a Shanghai-based GM spokeswoman said. She added the fall was not linked to trade tensions. The fall marks the maiden drop since the first quarter of 2017, when GM’s China sales fell 5.2 %. GM switched to reporting only quarterly China sales earlier this year, scrapping monthly sales figures it had previously revealed. China’s automobile sales have been falling more broadly in recent months, with a slowing economy and trade frictions making consumers cautious about spending, an industry body said last month. GM has been shifting its Buick cars to a new type of more efficient three-cylinder engine to meet emissions targets, which Chinese dealers told Reuters had hit sales because consumers were not yet convinced by the smaller engines. “Many consumers still have concerns because they read negative comments about 3-cylinder technology online, which aren’t really fair”, said a sales manager surnamed Hu at a Buick dealer in Zhejiang province. China, the world’s largest auto market, is critical for the U.S. carmaker. It sold over 4 million vehicles in the country last year, even more than it sold in the North Americas market. GM’s sales in China inched up 0.7 % in the second quarter of the year, slowing from an 8 % rise in the January-March quarter. GM’s joint venture in China, Shanghai GM, will also recall over 3.3 million Buick, Chevrolet and Cadillac vehicles from Oct. 20 due to a defect with the suspension system, a Chinese regulator said earlier this month. China’s main auto industry body, the China Association of Automobile Manufacturers, is set to reveal September auto sales later this week. +++

+++ Fiat Chrysler said on Monday it had kicked-off preparations for the production of a plug-in hybrid version of the JEEP Renegade as the carmaker pushes ahead with its electrification drive to meet tougher emissions rules. The world’s 7th-largest carmaker said in June it would invest €9 billion in electric and hybrid cars over the next 5 years to become fully compliant with emissions regulations across regions. It also pledged to phase out diesel engines in European passenger cars by 2021. The Jeep Renegade plug-in hybrid, expected in the market in early 2020, will be produced at Fiat Chrysler’s Melfi plant in southern Italy, which is already churning out the combustion engine version of the model and the Fiat 500X, Fiat Chrysler said. More than €200 million will be spent on the new engine, the company said, adding workers would be retrained for the new technology and the plant modernized. By 2022, Fiat Chrysler plans to offer a total of 12 electric propulsion systems, including battery electric vehicles (BEV), plug-in hybrids (PHEV) and full hybrids, it said, adding 30 different models would be equipped with one or more of these systems. Former FCA Chief Executive Sergio Marchionne had long refused to embrace electrification, saying he would only do so if selling battery-powered cars could be done at a profit. He even urged customers not to buy the Fiat 500e, its only battery-powered model, because he was losing money on each sold. But Tesla’s success and the need to comply with tougher emissions rules forced Marchionne to commit to what he used to refer to as “most painful” spending. Marchionne died unexpectedly in July after succumbing to complications from surgery, but his successor, Mike Manley, vowed to continue the strategy laid out in June. +++ 

+++ MERCEDES is considering slimming down its future model range in a bid to simplify its expanding portfolio and increase profitability. The German firm presented 5 new models at this year’s Paris Motor Show taking its current model portfolio up to almost 40 vehicles. Ola Kallenius, who will take over from Dieter Zetsche as Mercedes CEO next year, told he would be ‘rational’ in his approach to the firm’s future line up. “We have had 20 years of almost interrupted broadening of the portfolio especially on the SUV side”, Kallenius told. “It will take us, by 2020, will above 40 different models, but even if we love every child in the family we will also be very rational. If we see an itch where the economic proposition is not as attractive as some of the others we will not hesitate to slim down as well”. Kallenius did not specify which models faced an uncertain future. Mercedes revealed an all-new B-Class MPV at Paris, a segment that is one of the weakest in the new car market. He added: “I don’t think we’re looking at any radical trimming of the tree, but here and there we could look over the next 10 years at the portfolio and what makes sense and always cater it to where the market is going”. +++

+++ The future of the RENAULT Scenic and Grand Scenic is under consideration, according to Renault boss Thierry Bollore. The current generation only launched in 2016, but for the next generation, due in 2022 or 2023, the future is not certain. That’s due to a changing market in which SUVs reign supreme and MPVs such as the Scenic and Grand Scenic have fallen heavily out of favour. Bollore said: “For the next generation, there is a question: do we just have SUVs, or do we continue to have MPVs? This questioning is ongoing”. However, he added that it was “interesting to have an offer that wasn’t just an SUV” in the model range. Referring to the current Scenic, Bollore said: “Today, we are happy with what we are doing with Scenic but the segment is changing from year to year. For now, we are still fulfilling our customers’ needs”. Renault Europe boss Jean-Christophe Kugler, commenting on the ongoing success of the model, said: “Scenic customer loyalty levels are very high. We worked a lot with design, because one of the reasons customers rejected MPVs was often around design. Renault created the MPV market and so I think it helps having that leadership”. In Europe, Scenic and Grand Scenic sales peaked in 2004 at 319,131 units. Now sales are around the 105,000 market but have been broadly consistent for the past few years. Sales will increase this year, added Bollore. The Scenic and Grand Scenic were once important cars for family buyers, but as the SUV trend has surged worldwide, MPV sales have fallen dramatically. Renault now offers 3 SUVs in Europe: the Captur, Kadjar and Koleos. Together they account for almost one third of the company’s sales. +++

+++ SKODA ’s first all-electric model previewed by the Vision E concept will be offered in 2 different bodystyles. The Czech brand’s first offering on the VW Group’s bespoke all-electric MEB architecture is due in the second half of 2020. It had been expected to be a scaled-down version of the Vision E concept car (a swoopy coupe SUV) with an unusually long wheelbase of around 2.800 mm giving it similar levels of cabin space to Skoda’s own Superb. However, Skoda is aiming to offer both practicality and style-focused variants of its first electric car. Bernhard Maier, Skoda CEO, told us at this week’s Paris Motor Show: “It will be the first purpose built EV from Skoda and we will offer it in 2 bodystyles. We are at the final crossing where the design freeze is done and I think having in mind the latest status there really is not much to improve”. Asked how the 2 models would differ and which would arrive first, Maier added: “The first will be very close to the size of the Kodiaq with all the advantages of an electric vehicle, and the second will be one which meets the more emotional design needs of customers”. The Czech company could highlight this by showing not one but 2 different concepts of the new model during 2019, ahead of the final production model being revealed in the first half of 2020. It’s a product strategy Volkswagen is also employing with its production versions of the I.D. Crozz; a more design-focused variant will follow a more traditional, all-electric SUV model. Skoda’s Board Member for Technical Development, Christian Strube, told at Paris that his firm’s first offering would be larger than the initial MEB models from Volkswagen and Seat, both of which are expected to be 5-door family hatchbacks. “Our first MEB car will be a bit longer than them”, Strube said. “It will have basically the same wheelbase but a longer rear overhang”. +++ 

+++ TESLA claims its Model 3 has achieved the lowest probability of injury among all vehicles ever tested by the National Highway Traffic Safety Administration. The agency tested the Model 3 Long Range Rear-Wheel Drive edition for the New Car Assessment Program. Calculations for the likelihood of serious injury for front, side and rollover crashes shows the Model 3 beating all other models. Previous tests put the Model S and X in the first and second spots, respectively, but the Model 3 now has a significant lead over the more expensive models. Tesla credits the Model 3’s low polar moment of inertia, fortified battery pack, rigid passenger compartment and overall low center of gravity. “These safety fundamentals help to prevent intrusion into the cabin and battery modules, reduce rollover risk, and distribute crash forces systematically away from the cabin; all while providing the foundation for our superior front crumple zone that is optimized to absorb energy and crush more efficiently”, the company wrote. The Insurance Institute for Highway Safety has not yet released results from its series of Model 3 crash tests, which include the challenging small-overlap test that goes above and beyond the government impact assessments.

+++ Thought the Range Rover Evoque Convertible was an ill-conceived mistake? Soft-top soft-roaders haven’t exactly set pulses racing in enthusiast quarters (nor sales charts alight), but Volkswagen isn’t deterred. It’s confirmed a cabriolet version of its new T-ROC . It will be launched in the summer of 2020. It looks rather like a Golf or Audi A3 on tip-toe. The fabric roof could be a facsimile version. In February, Wolfsburg officially confirmed the new T-Roc Cabriolet, which will be built in its Osnabrück factory in Austria. It’s the same facility that manufactures the Tiguan and Porsche 718 Cayman and there had been question marks over its staffing levels; Volkswagen’s board has now announced it’s investing more than €80 million in the facility to prepare it for new T-Roc drop-top. Volkswagen chief executive officer Herbert Diess said: “Volkswagen is evolving into an SUV brand. The T-Roc is already setting new standards in the compact SUV segment. With the cabriolet based on the T-Roc, we will be adding a highly emotional model to the range. I am especially pleased to note that we can count on the Osnabrück team’s decades of experience with convertibles. The Osnabrück plant now has bright prospects for the future”. The Tiguan has quietly become quite a success story for the brand; it’s one of the 3 top-selling SUVs globally, and in the worldwide top10. The T-Roc Cabriolet is one of 20 SUVs or crossovers Volkswagen will have on its books by 2020. Make no mistake about the growing popularity of the bodystyle: crossovers will account for around 40% of VW’s sales by the end of the decade. +++ 

+++ VOLKSWAGEN is close to hiring Citigroup, Deutsche Bank, Goldman Sachs and JP Morgan to help with the potential stock market listing of its truck unit Traton, 2 people familiar with the matter told. Volkswagen said last month that Traton should by year-end be in shape for a potential stock market listing, which is expected to take place in mid-2019. Volkswagen plans to convert Traton’s legal structure to a Societas Europaea (SE) and to shortly mandate investment banks and legal advisers for a possible initial public offering, Volkswagen said at the time. Volkswagen, JP Morgan, Deutsche Bank and Goldman Sachs declined to comment. Officials at Citigroup were not immediately available for comment. The banks were likely to be mandated for the IPO. Volkswagen is targeting proceeds of more than €6 billion euros with a potential listing of its truck and bus subsidiary, the division’s chief executive had said earlier this year. Volkswagen has said in the past that it is considering a listing or partial listing of the trucks division, but that this would not happen in 2018. VW has plans to build a global trucks business by integrating its MAN and Scania divisions to challenge rivals Daimler and Volvo. A flotation could also allow Volkswagen Truck & Bus to build a war chest to completely buy out Navistar, a U.S. truck maker in which it already owns a 16.85 % stake. +++ 

+++ BMW’s new X6 M performance SUV-coupé has been spotted, with the M5’s 4.4-litre V8 under the bonnet for an anticipated output of 630 hp. It will top the range of the third-generation X6, which is expected to make its bow at the Shanghai motor show next April. Production will remain at BMW’s Spartanburg plant in South Carolina, US, where prototypes are already being built for testing. The X6 range will kick off with xDrive30d and xDrive40d variants, although a greater petrol-powered offering is expected. xDrive40i, 50i and 45e versions will make up the rest of the range, with the notable addition of the plug-in hybrid. M Performance M50d and M50i variants are also planned as BMW proliferates its M sub-brand, although the M50i petrol might not be offered in Europe, as it’s geared towards the US market. The M50d will be powered by a quad-turbo 3.0-litre six-cylinder diesel engine producing 400 hp. All engines will be shared with the mechanically similar new X5. Like the X5, the new X6 will be based on BMW’s CLAR platform, with double wishbone front suspension and five-link rear suspension. Air suspension will be an option. Compared with the previous X6, the roofline will be less coupé-like than before, with a more steeply angled tailgate. At the front, the car will follow the lead of the X5 in adopting the mono-kidney grille. The overall design draws heavily on that of the smaller X4, though. Inside, the new X6 will be almost identical to the X5, with BMW’s new 7th-generation iDrive infotainment system featuring. The X5 and new Mercedes-Benz GLE both made their first appearances at the Paris motor show earlier this week, meaning timings for the X6 and its most direct rival, the Mercedes-Benz GLE Coupé, are likely to be very similar. The GLE Coupé will get AMG 53 and 63 variants that are expected to closely match the M-tuned X6 models for performance. +++

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