+++ FIAT CHRYSLER AUTOMOBILES (FCA) chief executive Mike Manley told he is open to partnerships to develop a new midsize pickup truck the automaker could sell in Latin America and other markets outside the United States to compete with models such as Ford’s Thailand-built Ranger. “A gaping hole in our portfolio is a metric ton pickup” that would be a lower-cost, lower-priced vehicle aimed at work and commercial uses in markets outside the United States, Manley said. “Do you fill that individually or fill that in partnership? We are looking at what can we do individually, and if we partner with someone what would that look like?” Rivals Ford and Volkswagen said they plan to jointly develop replacements for their respective midsize trucks as part of a new commercial vehicle alliance. VW and Ford compete with Fiat Chrysler for pickup sales in a variety of markets, including the United States and Brazil. FCA last year outlined plans to launch such a pickup (smaller than its current Ram 1500 model) by 2022. Manley drew a distinction between the Jeep Gladiator midsize pickup that Fiat Chrysler unveiled in Los Angeles last November, and the “metric ton” pickup sold in developing markets. The Gladiator is a “lifestyle truck,” he said, that is not designed to compete at the lower price levels typical of work-oriented pickups. “The Gladiator is perfect for the U.S. market”, Manley said. “But because of its content it’s not perfect for Thailand”. Ford builds a version of its Ranger truck in Thailand, but heavily modified that vehicle to adapt it to the U.S. market. Rivals such as General Motors also sell different versions of midsize pickups in the United States than they offer in less wealthy markets. +++

+++ INDIA has displaced Germany as the world’s 4th largest market for vehicle sales by volume and is on track to take the number3 position from Japan within 3 years. Commercial and passenger vehicle sales grew 8.3 % last year to 3.99 million, overtaking the 3.74 million of sales in Germany, a market that grew less than 1 % in 2018. India is poised to overtake Japan as the third biggest market by 2021, as the country of 1.2 billion people grows more than 7 % a year, while Japan’s larger economy flatlines. However, despite the surging volumes in India, the low selling prices mean it is far from being one of the most lucrative markets for global carmakers. The average selling price for passenger cars in India is about $7,000; roughly a third of the level in major developed markets. Car sales are likely to continue growing at about 6-8 % a year, in line with broader economic growth. German carmakers, which dominated China’s rapid growth as it rocketed to the world’s largest market over the past 3 decades, appear unprepared for the shifting landscape. With few entry-level offerings, their share in India’s fast-growing market is about 1 % versus 69 % in its home market and 22 % in China. India’s car market has lots of capacity for further growth, measured by the number of passenger cars per 1,000 people (which was just 27 last year, versus 145 in China and 570 in Germany). Until now, India has not really undergone the same kind of economic boom as China, which has created a consumer class ready to spend. In India there is less ‘status symbol’ buying. But there could be enormous potential once India built its middle class. At present BMW, Mercedes and Audi are selling fewer than 20,000 cars a year, in a market of more than 3 million. Even the cheapest vehicles, however, are often prized by their owners as markers of upward mobility. After Tata Motors’ high-profile Nano car proved an expensive flop, analysts blamed its failure to cast the vehicle in aspirational terms. Tata had billed the Nano as the world’s cheapest car. A further hurdle faced by international carmakers seeking growth in India is the dominance of Maruti Suzuki, launched as a joint venture between Suzuki and the Indian government in 1982, which has a market share of 54 %. +++ 

+++ INFINITI ’s new president Christian Meunier said that the Q30/QX30 won’t return for a second generation in its current form. “The Q30/QX30 is not a very successful product. We’ll keep selling it for now. But this is not a product that has a future beyond its current life”, he said at the 2019 North American International Auto Show in Detroit. “It will be replaced in the future by an all-Infiniti platform”, Meunier added. The current Q30/QX30 is a result of a partnership between Infiniti-parent Nissan and Mercedes-Benz with a equally uncertain future. The 2 automakers’ partnership began in 2010, but it took until 2017 for a car to materialize from Infiniti. The Infiniti Q30/QX30 and Mercedes-Benz GLA-Class share related components, but last year Infiniti opted not to use an updated platform offered by Mercedes-parent Daimler. Up until late last year, the 2 said the partnership was still alive, although it’s unclear if any further shared cars will materialize. Nissan invested more than $300 million in a U.K. plant to build the cars, which included Mercedes tooling. Mercedes and Nissan co-own a plant in Mexico, which is expected to produce the Mercedes-Benz GLB-Class, but Infiniti won’t share a line for that model. Meunier hinted that the upcoming replacement for the Q30/QX30 could use variable-compression engine technology, which made its debut on the QX50 last year. A smaller-displacement engine (the QX50 uses a 2.0-liter variable-compression turbo) is in the pipeline, he said. It could be paired with batteries, which Infiniti calls e-Power, in the automaker’s new hybrid vehicles. Last year, Infiniti pulled from sale its remaining hybrid, the Q70 Hybrid, after shelving a slow-selling QX60 Hybrid and Q50 Hybrid. The automaker currently doesn’t offer any electrified models, but has said that by 2023 every Infiniti on sale would offer an electrified powertrain. +++

+++ It seems as though JAGUAR is trying to make the restyled XE feel more like a traditional sports sedan. In this case, it means giving it a sharper headlight design, revised front bumper with larger air intakes, new taillight graphics and a new (or old, depends on your point of view) gear shifter. While the rotary dial used in the original XE, as well as other Jaguar models, had a very ergonomic design and was easy to use, replacing it with something you can actually grab and hold might make the driver feel as though he’s in a sportier vehicle. Jaguar is sure to offer future XE buyers more on-board tech in order to feel left behind by the new BMW 3-Series. After all, the XE has always made its money as a genuine 3-Series fighter, so now there’s a brand new Bimmer out, it must up its game. Aside from its new shifter design, it will also sport JLR’s latest infotainment system and center console setup, with the touchscreen climate control display being visible right underneath the main infotainment screen in a Velar / all-new Evoque way. Moreover, the gauge cluster will go fully digital, like in the I-Pace. I expect the updated XE to be among the automaker’s first models to boast a mild-hybrid powertrain. Word has it that this system will feature a 48-volt architecture, with a belt alternator starter and a small lithium-ion battery working alongside the company’s Ingenium engines. Jaguar should unveil the 2019 XE in the early part of the year, possibly at the Geneva Motor Show in March. Once on sale, the updated XE will resume its battle with the Audi A4, Mercedes C-Class, Alfa Romeo Giulia and, of course, the all-new 3-Series. +++ 

+++ NISSAN ’s board, whose lapses in oversight were revealed by the arrest of former chairman Carlos Ghosn for alleged financial improprieties, has taken on expanded powers. The board widened the scope of decisions that require its approval and decided on an interim process to set compensation for directors and executives, according to a statement. Nissan has come under fire for internal rules that provided little oversight over Ghosn, a globe-trotting business icon who once led a rescue of the automaker, in directing his own pay. Chief Executive Officer Hiroto Saikawa, a former Ghosn protege, has pledged to address corporate governance shortcomings that ensnared the company in the scandal involving the former chairman, who was accused of underreporting his income. The Japanese carmaker is rushing to regain credibility as questions swirl over its relationship with French partner Renault and the future of their automotive alliance. Nissan said the decision on who decides compensation would remain in effect until a committee on improving governance hands down its proposals. The company also updated its corporate governance code last month to clarify its policy on cross-shareholdings, which has direct bearing on its partnership with Renault. The board “re-emphasized its commitment to its alliance partnership with Renault and Mitsubishi”, according to the statement. Ghosn held pivotal roles in Japan and France as chairman of Nissan and chief of Renault, as well as head of the alliance that binds together both carmakers. Nissan, where allegations of wrongdoing surfaced, moved swiftly to remove him from his post after his arrest on Nov. 19, while Renault nominally kept him in place as it awaits more evidence of misconduct. +++

+++ The French government is moving to dismiss RENAULT ’s scandal-hit chairman and chief executive Carlos Ghosn and has requested a board meeting to consider candidates to replace him. France, Renault’s biggest shareholder, had until now supported the company’s decision to keep Ghosn in office while he awaits trial in Japan for alleged misconduct at Nissan, the French carmaker’s alliance partner he also chaired until his dismissal in November. But the government, which commands a 15 % Renault stake and 2 board seats, has asked the company to convene its nominations committee followed by a full board meeting on Jan. 20 to begin the process of appointing one or more successors to Ghosn, according to 3 people briefed on the process. A spokesman for Renault and a French finance ministry official both said they had no knowledge of plans for a weekend board meeting. Ghosn’s Nov 19 arrest in Japan and swift firing by Nissan have deepened tensions with Renault, which owns a 43.4 % stake in the Japanese carmaker. The French move to replace Ghosn follows a decision by the Tokyo District Court to deny the ousted chairman’s request for release on bail. Ghosn has been charged over allegations that he failed to disclose close to $80 million in additional compensation for 2010-18 that he had arranged to be paid later. Nissan director Greg Kelly and the company itself have also been indicted. Both men deny that the deferred pay agreements were illegal or required disclosure, while former alliance boss Ghosn has denied a separate breach of trust charge over personal investment losses he temporarily transferred to Nissan in 2008. Jean-Dominique Senard, who is soon to step down as CEO of tyre maker Michelin, is likely to replace Ghosn as Renault chairman, according to 2 sources. The French state and its advisers are also considering candidates for the Renault CEO role currently occupied on an interim basis by Ghosn’s deputy Thierry Bollore. Bollore is among contenders for the permanent CEO appointment, along with senior Toyota executive Didier Leroy, Elior boss Philippe Guillemot and one other executive, a source involved in the discussions said. Alternatively Senard himself could also assume the CEO title, effectively taking over both of Ghosn’s current roles, the source said. “All these options are on the table”. Leroy declined to comment. French officials had said Ghosn should be kept in office unless it became clear he was would remain “incapacitated” for much longer, also hinting that Tuesday’s court decision would be an “important development”. 2 senior French finance ministry officials were travelling to Tokyo for talks with Nissan stakeholders aimed at stabilising the alliance with Renault. Nissan CEO Hiroto Saikawa said in a interview he expected Renault to back the Japanese carmaker’s ouster of Ghosn when its board of directors were finally given full access to the findings of its internal investigation. +++ 

+++ ROLLS-ROYCE chief executive Torsten Müller-Ötvös says the British automaker’s plant in Goodwood could be crippled by potential Brexit complications. The automaker’s just-in-time production system means it doesn’t typically hold parts for more than 24 hours and this method of production could be harmed by Brexit, whether or not the UK reaches a deal with the European Union. In preparation for a no-deal Brexit on March 29, Rolls-Royce has started to train suppliers in new import procedures, is investing in new IT systems, and preparing to have certain parts flown in from overseas if port deliveries are delayed due to customs issues. “You can plan for whatever you want but you can’t store up weeks of parts, and if the logistics chain breaks it will affect production. You only need to miss one component and you can’t finish the car”, Müller-Ötvös revealed. Only 8 % of Rolls-Royce parts are produced in the UK. As such, the company imports roughly 32,000 parts from more than 600 global suppliers to build its vehicles. The company undertakes 35 truck journeys across the English Channel per day to ensure production runs smoothly. British Prime Minister Theresa May has proposed an exit agreement with the European Union but it’s expected to be rejected by national lawmakers. While Rolls-Royce is aware that its production could be harmed by the UK leaving the EU, Müller-Ötvös said that there’s no chance the car manufacturer will shift production outside of Britain. +++ 

+++ Auto executives gathered in Detroit called on the TRUMP administration and Congress to resolve trade disputes, and end the government shutdown, saying political uncertainty is costing the industry. U.S. trade officials are negotiating a new deal with China in hopes of avoiding new tariffs, while a new regional trade agreement with Canada and Mexico still needs congressional approval. Automakers producing vehicles in the United States are contending with U.S. steel and aluminum prices driven higher by Trump administration tariffs. Fiat Chrysler Automobiles chief executive Mike Manley told that U.S. metals tariffs will raise the automaker’s 2019 costs by $300 million to $350 million, or about $135 to $160 a vehicle, based on the automaker’s 2018 U.S. sales. Toyota’s executive vice president for North American sales, Bob Carter, said the company has had to raise prices 3 times because of higher tariff costs, even though 96 % of steel in Toyota U.S. vehicles is from U.S. steel plants. The tariffs boosted industry vehicles prices by about $600 on average, he estimated. General Motors and Ford are also taking financial hits from the U.S. steel and aluminum tariffs. “Those are headwinds”, GM president Mark Reuss told. “It’s our job to run the business to offset those headwinds”. GM chief executive Mary Barra promised investors the company would boost 2019 profit despite tariff-related costs and investments in electric vehicles. She stuck to her plans to target 5 North American factories for closure and cut nearly 15,000 jobs overall About one-quarter of federal government operations have been shut down by a lack of funding since Dec. 22 after President Donald Trump demanded $5.7 billion this year from Congress for building a security wall on the southwest U.S. border. +++ 

+++ VOLKSWAGEN confirmed it will build electric cars at its plant in Chattanooga, Tennessee, beginning in 2022. The automaker will invest $800 million in the site for electric car production and in the process create around 1,000 jobs directly at the plant, plus additional jobs at supplier firms. VW is preparing a family of next-generation EVs based on its MEB modular platform, the first of which will be a Golf-sized hatch due later in 2019. The first MEB-based EV sold in the United States will be a small crossover based on 2017’s Crozz concept. It will go on sale in Europe in 2020. It isn’t clear what electric car(s) VW will build at the Chattanooga plant, though the 2022 timeline points to a van based on 2017’s ID Buzz concept. The 2022 date is when the van, a spiritual successor to the iconic Microbus, is due to go on sale here. VW already builds the Passat and Atlas at the Chattanooga plant. A 2-row version of the Atlas to be called an Atlas Cross Sport will begin production at the site later in 2019. VW may announce additional U.S. production plans very soon. The automaker announced an expanded tie-up with Ford, and rumor has it the tie-up could see VW use some of Ford’s space capacity in the U.S. to build its own models. Stay tuned. +++

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