Newsflash II

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+++ AUDI will make greater use of vehicle platforms and technologies developed with Porsche and Volkswagen as it embarks on a €15 billion cost cutting and efficiency drive, Chief Executive Bram Schot said. Audi, whose slogan is Vorsprung Durch Technik or Advantage Through Technology, was a key research hub within Volkswagen Group until its engineers were caught developing the engine software which masked excessive pollution levels. Now new Chief Executive Schot is tasked with overhauling Audi and refocusing research efforts after senior engineers were forced out by the dieselgate scandal, which has cost parent company Volkswagen more than €28 billion. “We are discussing what we do ourselves and where we share resources with other parts of Volkswagen. We ask ourselves: Do we need to do this in-house, is it standardized technology, and is it unique from the customer point of view”, Schot said. As part of group-wide savings efforts at Volkswagen, Audi has surrendered responsibility for developing driverless cars to engineers at VW in Hannover, Schot said, adding that Audi still retains responsibility for making semi-autonomous cars which still require drivers. Sources told in November that Audi may surrender its leadership in the area of developing self-driving cars as Volkswagen Group seeks to save costs. Further savings could come from deepening a research alliance with Porsche, another premium brand owned by parent company Volkswagen. “We can intensify our collaboration with Porsche”, Schot said. Porsche and Audi are already developing vehicle underpinnings for a premium electric sportscar, known as PPE. This vehicle platform will spawn a raft of premium electric cars, the company said. Audi will offer about 30 electric models by 2025, the company said. The customer response to these vehicles will help determine the scale of possible job cuts, the carmaker said. Audi workers have a job guarantee until 2025 but electric cars require fewer parts and fewer workers to assemble so Audi is working on a job cuts scheme which relies on voluntary redundancies through early retirement. The carmaker declined to provide a figure for possible headcount reductions citing ongoing negotiations with labor representatives at Audi. It said it expects to deliver an operating return on sales between 7 % and 8.5 %, below its long-term target, as costs for developing electric cars weigh on profits. Audi aims to deliver an operating return on sales of between 9 % and 11 % in the long term. +++ 

+++ There’s a lot of talk nowadays about how everyone will use self-driving cars in the not-so-distant future, but a new study doesn’t paint such a rosy picture. According to the latest survey from the American Automobile Association (AAA), 71 % of people questioned are afraid to ride in fully AUTOMOMOUS self-driving vehicles. While there’s no significant change from last year’s survey (73 %), the AAA found more people are wary of driverless cars than in 2017, when 63 % of respondents felt the same. The survey was conducted by telephone (both landline and cell phone) between January 10-13 and included a total of 1,008 interviews of adults, 18 years of age or older, accurately representing the total continental U.S. population, with a 4 % margin of error. According to the AAA, the significant surge in self-driving car mistrust among the U.S. public may have something to do with several high-profile automated vehicle incidents that happened over the past 2 years. So how can Americans be made to trust autonomous technology more? The AAA believes this can be done by bridging the gap between the perception of automated vehicle technology and the reality of how it actually works in today’s cars. “Having the opportunity to interact with partially or fully automated vehicle technology will help remove some of the mystery for consumers and open the door for greater acceptance”, said Greg Brannon, AAA’s director of Automotive Engineering and Industry Relations. More specifically, AAA believes that interacting with advanced driver assistance systems (ADAS) such as lane keeping assistance, adaptive cruise control, automatic emergency braking and self-parking “significantly improves consumer comfort level”. The survey revealed that drivers who have 1 of these 4 ADAS technologies are about 68 % more likely to trust these features than those who don’t. They also found that Americans are receptive to the idea of automated vehicle technology in more limited applications. For example, 53 % are comfortable with low-speed, short distance people movers found at airports or theme parks (thus not in public traffic), while 44 % are comfortable with fully self-driving vehicles for food or package delivery. However, only 19 % of Americans remain comfortable with the idea once the passengers are their loved ones. Maybe the majority is not as willing to hand over the reigns to automated systems just yet, as automakers and tech giants would have us believe. At least not until the technology proves itself. +++ 

+++ BENTLEY has just unveiled 2 brand new versions of its third-generation Continental GT and GT Convertible models, both available with a new 4.0-liter twin-turbocharged V8 petrol unit, producing 550 hp and 770 Nm. In a straight line, the Coupe can rocket to 10 km/h in 4.0 seconds (Convertible needs 4.1 seconds), and will top out at 318 km/h. Customer deliveries will commence in Q1 of 2020. +++ 

+++ MERCEDES ‘ X4 rival, the GLC Coupe, is about to be unveiled. The company didn’t say when, but they confirmed that the premium compact SUV coupe is “coming soon”. So, should we perhaps look for it at next month’s New York Auto Show? Probably, although it might debut online a few days earlier. Until its official presentation however, the automaker has brought the facelifted GLC Coupe forward in a teaser. The footage previews the front end and rear ends, the former appearing similar to that of the regular GLC facelift. Meanwhile, the rear appears to feature slightly updated taillights. Just like the normal GLC, the refreshed GLC Coupe won’t get any dramatic visual changes, as Mercedes didn’t want to mess with a winning recipe. Besides the usual trim updates and new wheels, the GLC Coupe will get the optional 12.3-inch digital instrument cluster and a free-standing display in the middle of the dashboard, available in 2 sizes: 7.0 and 10.25 inches. If it stays true to the GLC, then it will also adopt a new multi-function steering wheel as well, along with the touchpad on the center console and other amenities found in its facelifted sibling. The AMG models are expected to join the lineup later on, in 63 and 63 S and 43 guise. +++ 

+++ The Z and GT-R are among the most revered nameplates from NISSAN , if not in all of auto-dom. Both, however, are in generations that have lasted a decade or so with no hints from the company about their futures. So, whenever a top Nissan executive whispers a phrase about either model, enthusiasts take notice. The most recent utterance comes from chief planning officer, Philippe Klein, who told that the company is pondering the next step for both the Z and GT-R. Klein says that while performance cars are “under the gun of regulations”, that the company doesn’t want to let go of these cars so easily. “The emotion is still there, for us and for our customers”, Klein said. Klein then hinted that Nissan is considering an electrified option for both vehicles. “I don’t know how much experience you have with EVs, but they are very fun to drive”, he told, alluding to the accelerative abilities and low center of gravity inherent in electric cars. “The driving experience is very high on our priority list”, Klein reassured, adding that the challenge is how to maintain that experience while conforming to regulations is a challenge. If any company has the ability to do that, though, it’s Nissan, who, in their alliance with Renault and Mitsubishi comprises one of the largest car companies in the world. If carmakers like Honda, BMW, and Mazda can do it, so can Nissan. +++ 

+++ PORSCHE has teased its new Taycan electric car in a pair of design sketches. Confirmed by CEO Oliver Blume at the brand’s annual press conference, the 4-door electric GT car will make its public debut in September, most likely at the Frankfurt Motor Show. The images hint that the overall look of the Tesla Model S rival will stay faithful to the Mission E concept from 2015. Indeed, the most significant difference appears to be that, unlike the concept, the production model will feature conventional door mirrors as opposed to rear view cameras. Earlier spy shots of a pre-production Taycan model undergoing winter testing showed us that the charging point will be more conventional than the concept’s design, too: a small flap will take the place of the Mission E’s extravagant hinged panel behind the front wheel arch. Porsche engineers are testing the Taycan’s ability to recharge in sub-zero temperatures. The Taycan’s charging capability is something Porsche is keen to push as a selling point. The firm promises that it’ll be the first production vehicle capable of recharging at 800-volts, where possible when it arrives on sale. Sales are yet to formally commence, but Porsche claims to have received upwards of 10,000 order requests from potential Taycan customers. The 4-door saloon format is described as a ‘four plus one’ with space for luggage front and rear, while the driving position is “almost identical to the 911”, according to Robert Meier, director complete vehicle model line Taycan. In the Porsche Taycan’s interior, a freestanding curved digital instrument displays sits directly ahead of the driver, as it did in the original concept. To the right is a small toggle-style gear selector for Drive, Neutral and Reverse. A large infotainment screen, much like the 10.1-inch unit used by Audi, sits flush within the vertical gloss finished panel that stretches across the fascia. A second touchscreen sits in a sloped centre console between the front seats, making the cabin almost devoid of physical buttons. In the back sits a recessed foot well, which Porsche calls a ‘foot garage,’ made possible by the company’s decision to do away with the battery cells in the area. Porsche’s engineers remain tight-lipped on exact driving range and battery size, but tell us to expect upwards of 500 kilometres on a single charge; fast charging at up to 350kW could add more than 300 kilometres of range in 9 minutes. Inductive charging is also in development, but won’t be available at launch. Buyers may be able to buy temporary or permanent upgrades via over-the-air updates, similar to Tesla. More power and different chassis setups are all possibilities according to Lutz Meschke, deputy chairman for Finance and IT at Porsche. Initially, the yearly Porsche Taycan production output will be between 20,000 and 25,000 units. “We are capable of ramping up our production capacity substantially if demand exceeds expectations”, said Meschke.“We will be able to ship significant numbers in the coming years”, he added. According to Porsche, Taycan is a word taken from an eastern dialect and is pronounced ‘tie-can’. It translates as ‘lively young horse’ and is a reference to the horse that’s been rearing up on its hind legs on the Porsche badge since 1952. Porsche remains tight-lipped the Taycan’s exact specifications, but I understand the car will feature 2 electric motors, one on each axle, will produce over 600 hp. The PSM motors are derived from Porsche’s Le Mans winning 919 LMP1 car, the marque claiming that the key advantage offered by PSM is compact packaging and weight saving. Porsche claims this powertrain will allow the Taycan production car to cover 0-100 km/h in under 3.5 seconds before hitting a top speed of 250 km/h. Crucially, I’m told the performance will be repeatable with the electric car able to accelerate hard ‘over and over again without losing performance’. Charge will be provided by a lithium-ion battery pack denser than anything Tesla currently offers, rated at 270 watt-hours per kilogram. It’s claimed that the 800 volt system can take on 100 kilometres of charge in just 4 minutes, or almost 400 kilometres in 15 minutes. Of course, these figures are entirely dependent on the availability of 350kW CCS chargers compatible with Porsche’s 800v system. Currently, the IONTY network is expanding throughout Europe and building chargers capable of delivering such voltages. This version of the Taycan is expected to be the flagship model but additional variants of the car, of which there is likely to be three, will vary from around 400 hp up to 600 hp. Blume told me: “We will think of different options and there will be more than one, with different levels of power”. All-wheel drive is expected to be standard on all versions initially, but there is the possibility that Porsche will launch a more affordable rear-wheel-drive edition in the future. An expansion of the Taycan lineup is also on the cards: the E-Cross Turismo Concept is now confirmed for production. Called the Taycan Cross Turismo, it will feature an estate-styled body with crossover touches like a raised ride height and extra body cladding. Porsche bosses have revealed a fully electric SUV is likely to follow the Taycan pair into showrooms. Meschke: “Expect it by 2022 at the latest”. While confirming the new Taycan models, Blume also confirmed an increase in Porsche and profits and sales in 2018, each increasing by 4 % over 2017 figures. As a result, Porsche plans to increase investment in new products. Over €6 billion will be invested in the upcoming range of plug-in hybrid and pure electric vehicles by 2022, with a total of €15 billion to be spent developing new cars up to 2023. A further 1,500 employees will be hired for producing the Taycan, a figure which adds to the current 32,325 workforce – itself a nine percent increase on 2017 numbers. +++ 

+++ RENAULT , Nissan and Mitsubishi need to streamline the alliance’s decision-making processes, Renault hairman Jean-Dominique Senard said in an interview. The 3 automakers announced last week that they will establish a new management board consisting of their top leaders, including Senard, to decide alliance strategy. According to a report, Senard said he wants the board to be composed of people who have the power to make decisions at each company. He also said the team around him is not working on boosting cross-shareholdings between Renault and Nissan. Senard denied speculation about a conspiracy by Nissan related to the arrest by Japanese authorities in November of then-Nissan Chairman Carlos Ghosn, who was also chairman and chief executive officer of Renault, for alleged financial misconduct. Nissan has not shown any intention to withdraw from the alliance, Senard said. A Nissan committee tasked with improving the automaker’s governance said it will release a set of proposals March 27. The committee, formed after Ghosn’s arrest in November, said it will hold a news conference that day. The proposals will likely include increasing the number of outside directors on Nissan’s board, according to people familiar with the panel’s discussions. Based on the proposals, Nissan will speed up its process of forming a new management structure. The news conference is expected to be attended by lawyer Seiichiro Nishioka, the co-chair of the panel, and Sadayuki Sakakibara, a former chairman of Keidanren, the nation’s top business lobby. Nissan is considering naming Sakakibara as the chief of the board, sources familiar with the company’s reform have said. +++ 

+++ In SOUTH KOREA , car purchases by the key demographic of consumers in their 30s and 40s have declined for 3 years running, but they still buy more and more foreign cars. According to the Korea Automobile Manufacturers Association, new vehicle registrations by people in their 30s reached 265,296 last year, and 57,542 were imported. That means foreign cars now account for 21.7 % of their purchases, surpassing 20 % for the first time ever. People in their 40s bought 296,559 cars over the same period, with imports making up 17.2 %; up 2.6 percentage points compared to 2017. In all age groups, imported cars accounted for 14.9 % of purchases. Yet total car purchases by those in their 30s and 40s fell 4.4 and 4.9 percentage points, down for a third year running. Total new vehicle registrations in Korea last year stood at 1.12 million, down 2.6 percentage points compared to 2017. An industry insider said, “Rising unemployment and inflation have made young consumers think twice about buying cars, while the spread of car-sharing services is also having an impact. But if they are going to spend money on a car, more and more people opt for imports, so their market share will rise”. +++ 

+++ TESLA shares fell nearly 5 %, as investors wondered if its unveiling of the Model Y would add to pressure on cash flow, while analysts worried the carmaker was not addressing slowing demand for other models. Tesla introduced a cheap $35,000 version of its Model 3 sedan last month and is struggling to convince backers its business model works. “It seems to be another distraction tactic presenting a new model and (to) divert from the problems with the other cars, the production and the profitability”, analyst Frank Schwope said. None of the 30 analysts who cover Tesla cut their price targets or recommendations for its shares, but the slightly bleak response to the new launch underlines the ambivalence of some on Wall Street to the company after months of legal wrangling and social media outbursts by chief executive officer Elon Musk. Some Wall Street analysts had raised concerns that demand for the higher-priced Model 3 was slowing down in the United States, especially after a reduction in the federal tax credit this year. “We believe that Tesla’s original business model for the production and profitability of the ‘affordable’ $35,000 version of the Model 3 is proving to be very difficult to achieve”, ratings firm Moody’s wrote in a research note. The launch of the Model Y also reignited worries that Tesla would need to raise cash sooner than later. 2 Tesla analysts, both known as Tesla bulls (Gene Munster from Loup Ventures and Ivan Fienseth from Tigress Financial Partners) said the company would likely need to raise money later this year. Cowen & Co’s Jeffrey Osborne, who has an “underperform” rating on the stock, also agreed. “We believe the event was more of a capital raising effort and branding exercise”, Osborne said in a client note. “We do not see the new Model Y igniting elevated demand or enthusiasm for the Tesla brand”. Tesla has been cutting jobs and closing stores in a bid to make profits and expects a loss in the first quarter. +++ 

+++ Personally, professionally and spiritually, the Geneva Motor Show is the only place to be for someone in my line of ‘work’ in early March. If you consider yourself committed petrol, diesel, LPG, electric or hydrogen head, you should be there, too. Believe it or not, you could pop over and back in 18 hours for far less money than you might imagine. Hurts me to admit this, but it’s considerably cheaper and more convenient to take the plane than the car. The fact that the show venue is a 10-minute stroll from Geneva Airport is another compelling reason to fly. This year, most of the exhibitors deeply impress: none more so than the VOLKSWAGEN Group and its battalion of mid-to-upmarket brands, which barrack themselves away on the highest floor of the event, looking down on their rivals. Others at the Swiss show (Sbarro, for example) make me chuckle. But the absence of Jaguar Land Rover and its hugely important all-new Evoque almost brings me to tears. A motor show minus Jaguars and Land Rovers is like battered cod without chips. And it saddens me more that the word which best sums up the just-arrived, soon-to-be-launched or distant-future models at Geneva 2019 is ‘expensive’. Can the motoring masses in Britain and the rest of the world afford most of Geneva’s ‘star cars’? No chance. When a likely €35.000 price is mentioned for Honda’s humble electric e-Prototype, real-world customers know they’re being priced out of the new car market. So I was pleasantly shocked to hear that the Volkswagen Group is proceeding with a bargain-bucket car that will massively undercut Seat and Skoda, the lowest-priced (but not low-price) marques in its current stable. We’re talking about a globally significant vehicle group making noises about bolting together and selling proper, basic, inexpensive, Asian-built cars; mainly for inevitably skint young people, but with low-paid older folk and retirees in mind, too. The likes of Tata (with the Nano) and Datsun (Go) have dabbled with this sort of car but with limited success, and not much global relevance. The Volkswagen Group is, for now at least, talking only about its cheapomobile being sold to Chinese buyers, and that will discriminate against the rest of us. VW must widen this car to other, less-than-flush parts of the world. It also needs to change the name of its new brand from Jetta to something that does what it says on the tin. I reckon the LIM (Less Is More) or FTB (First Time Buyer) marque should be a beyond-China brand, sitting below Seat and Skoda, at an end of the market VW Group currently refuses to serve. All the more reason why a slow, safe, stripped-out, steel-wheeled, shabby-chic ‘starter’ car for nearer €10.000 is desperately needed. And no, that just-unveiled Twizy-lookalike from Seat is not that car. Mainly because it’s a quadricycle, as far as I can tell. C’mon, Wolfsburg: bite the bullet and build the affordable Car for the People, of China and of the rest of the world. You could even base it on a previous-generation Polo. +++ 

+++ VOLVO will restructure its management board, reducing its size to 13 from 15 members and giving 2 executives added duties as the company seeks to put more emphasis on technological developments and digitalization. Volvo R&D boss Henrik Green and strategy and retail head Bjorn Annwall will take on expanded roles while longtime Volvo executive Lex Kerssemakers gets a new post. In announcing the changes, Volvo said: Annwall, 43, who currently heads global consumer experience, will lead the Commercial Operations cluster, which puts him in charge of developing Volvo’s core global business with a focus on growth and profitability. In addition, he will take charge of customer service, global marketing and communications as well as the Europe, Middle East, Africa region. Green, 46, leads Volvo’s Product Creation & Quality cluster, which will be expanded to include design as well as a function called consumer and enterprise digital. Volvo believes that by consolidating the multiple roles it will strengthen the link between the company’s in-­car software development and the work it’s doing on digital products for its customers. Kerssemakers, 59, will take over the newly formed Direct Consumer Business cluster. In this role, he will be responsible for developing new direct business relationships with consumers. Leaving the board are: Thomas Ingenlath, who remains CEO at Volvo subsidiary Polestar and Volvo Car Group’s chief design officer. Ingenlath’s board responsibilities move to Green. David Ibison, who is is setting up his own communications consultancy. Ibison’s responsibilities transfer to Annwall. All changes take effect on April 1. In an unrelated move, Volvo announced that Chief Financial Officer Hans Oscarsson will become CEO of Geely Sweden Holding, which is responsible for Volvo parent Zhejiang Geely’s investments in the Nordic region. Oscarsson starts his new job on August 1. Volvo will name a new CFO at a later date. +++ 

+++ Audi CEO Bram Schot has revealed that the company delivered 3.5 % fewer vehicles to customers in 2018 than in 2017. Speaking at the company’s annual press conference, Schot stated that the 1.812 million Audi models sold in 2018 represented a drop of 65,000 compared with the previous 12 months. In financial terms, this drop in sales translates to a €1.2 billion decrease in profit margins, down to €3.5 billion from €4.7 billion. The reason for the shortfall, Schot claimed, is a lack of preparation for the implementation of WLTP European emissions regulation. Audi was forced to create gaps in its product portfolio as certain powertrains fell foul of increasingly stringent pollution-targeting legislation, which in turn led to shift cancellations at the company’s Ingolstadt production facility. Chief financial officer Alexander Seitz said the profits achieved are “a clear reflection of Audi’s failure to prepare for WLTP”, and “do not reflect Audi’s expectations”. Schot said the company is better prepared for WLTP in 2019, having reduced its range of possible engine/transmission combinations by 30 % and implementing a new “consistently Audi” operating ethos. Working on the principles of transparency and integrity, Schot said, will help Audi to “find its way back” to the strength it enjoyed at the beginning of the millennium. As part of the company’s ultimate aim to introduce 30 electrified models by the end of 2025, the brand’s stand at the Geneva motor show displayed only EVs, including the all-new Q4 E-tron.  Schot is confident that the growing electrified range will appeal to a wide audience, stating that “every customer will find the right ‘E’ model”. +++

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