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+++ CADILLAC ’s Super Cruise driving assistant is able to navigate most U.S. highways all on its own, as long as the driver maintains his or her eyes on the road. However, it’s been known to struggle in direct sunlight, as there have been instances where it abruptly disengaged. Super Cruise won’t work perfectly in certain weather conditions, such as heavy rain or snow, or in this case bring sunlight, which can disrupt the driver-facing camera. “Just as the sun makes it hard for you to see what’s ahead of you, it does the same thing for a camera”, states Sam Abuelsamid, an engineer and Navigant Research analyst. “It is a challenge”. Thankfully, fixing this problem has been at the top of Cadillac’s to-do list when it comes to their next-gen Super Cruise system, which will feature “significant changes” in terms of hardware, stated GM automated-driving engineer Daryl Wilson. While he declined to say when the updated system will be rolled out, it’s likely that GM will want it ready by the time it begins to make Super Cruise available across its entire lineup, starting next year. “We are learning from this, and we’re going to make that availability much more robust in those situations”, he added. GM updated the driver monitoring system back in May of 2018, in order to make it less susceptible to sunlight hitting the camera from the side. But a solution for direct sunlight is harder to come by. Abuelsamid thinks that the U.S. automaker will have to change the actual positioning of the camera or possibly install some type of filter or diffuser that allows the system to see better. “That’s not something they’re going to be able to fix with software”, he said. “That’s a flaw in the physical design”. GM’s Super Cruise is currently limited to single-lane driving on some 209,000 km of limited-access freeways in the U.S. and Canada, which have been mapped with LiDar. +++ 

+++ Over the past few years, car manufacturers and industry analysts have been pushing forward the notion that CAR OWNERSHIP will soon become a thing of the past. Citing declining vehicle ownership figures among young people, companies have started to introduce car sharing and subscription programs because, as they claim, a big portion of the population simply has no interest in owning cars anymore. However, reports of car ownership declining may be overstated. A 2017 paper written by Nicholas Klein from Columbia University and Michael Smart from Rutgers University concluded that only those millennials in tough financial situations owned fewer cars than previous generations. At the other end of the spectrum, young people who have achieved financial independence actually own more cars than expected based on their incomes and wealth. It is suggested that the global financial crisis of a decade ago adversely affected millennials and their pursuit towards financial independence. A separate study from Christopher Knittel of the Massachusetts Institute of Technology and Elizabath Murph from power company Genser Energy also indicates that younger people are driving vehicles more than baby boomers did at the same age. Using U.S. government data, the authors concluded that millennials own 0.4 % fewer vehicles per household than baby boomers once did. However, millennials drive more than older Americans and younger generations “still have strong preferences for personal vehicles”. In 2016, Lyft co-founder John Zimmer suggested that car ownership would virtually die out in major cities across the United States by 2025. Based on recent studies, however, that seems extremely unlikely. So, autonomous or car-sharing lovers, you may want to hold your horses (or robots) because drivers are going to be relevant for quite some time. +++ 

+++ About 30 years ago, former Volkswagen boss Carl Hahn sought a cost-effective solution to build cars in CHINA with First Automobile Works. Eager to continue with his pioneering push into the country, it occurred to him that VW’s failed U.S. plant might provide the answer. The Pennsylvania factory had closed in 1988 and all the tools needed to build the Jetta were collecting dust. By moving the entire production machinery to a new plant that would be jointly operated with FAW in Changchun, Hahn had a solution to both of his problems. Risks would be minimal since everything he needed had already been written off. With help from the affordable sedan, VW mobilized a generation by putting millions of rising middle-class Chinese behind the wheel of a new car. This helped to establish VW, together with FAW and its other local joint venture, Shanghai-VW, as the dominant automotive force in what is now the world’s largest vehicle market. Nearly 3 decades later, VW Group boss Herbert Diess’s decision to take responsibility for the market after the retirement of his China chief, Jochem Heizmann, highlighted the importance of the country. “Today our Chinese operations are the most successful worldwide with benchmark productivity and quality, the best product launches worldwide, and they are our most profitable operations”, he told VW’s local staff in January. Profitability in China is at risk not only at VW Group but at a wide array of automakers. “Life looks grim in China at present”, said Bernstein analyst Max Warburton, who believes the situation poses a major risk to earnings. A dreadful second half pushed the market into the red last year for the first time since 1990. Car buyers in China have been postponing purchases in mass numbers because of trade tensions with the U.S. Particularly hard hit are automakers reliant on low-cost cars. “The total market is cooling down, but the premium market is cooling down less”, Audi CEO Bram Schot told. “What’s more important is the effect on pricing. If everyone has really high expectations for 2019 and they sustain a blow in volumes, they want to correct this with lower prices. It has a huge impact”. Underlying indicators imply the trend will not change anytime soon. Beijing forecast that domestic growth will slow to as little as 6 % in 2019, down from 6.6 %, which represented the most anemic pace in nearly 30 years. Many economists believe the actual rate of expansion is much lower than government statistics would suggest, and VW Group only expects a stagnant overall car market this year. “If we don’t get a large and determined policy response, and we are talking a big macro stimulus, not just a tax cut on cars, then the industry is going to need to make substantial production cuts in the first half”, Bernstein’s Warburton said. Following a conclusion of the annual plenary session of China’s legislature, Prime Minister Li Keqiang promised all manufacturing companies a 3 % cut in value-added tax to 13 %. But China’s second most powerful official after President Xi Jinping warned the state would not inject the kind of massive monetary stimulus seen after the global financial crisis. The ramifications of China’s slowdown for the European auto industry are potentially enormous, which is why automakers are starting to unveil plans to cut their overall costs by billions. Fiat Chrysler Automobiles said it has plenty of problems to fix after sales of locally built Jeeps plunged by 40 % and shipments of imported Maseratis more than halved in 2018. The automaker’s Asia-Pacific operations swung to a full-year operating loss of €296 million as a result. “A lot of the work that the team in China has done has been focused on our direct material costs, some of that you can get to quickly”, Fiat Chrysler boss Mike Manley said. “Some of that, because it involves re-engineering and testing, takes a little bit of time”. The enormous growth in recent years has meant brands have become heavily reliant on the region to boost global volumes. For example, 40 % of all passenger cars sold last year by the VW Group worldwide were built by FAW-VW and Shanghai-VW. Were the JVs treated as fully consolidated companies, each would have contributed more to overall earnings than any other group subsidiary last year. Moreover, their pretax margins would have been surpassed only by Porsche. Premium brands are nearly as dependent, particularly when it comes to their high-end models. Last year BMW sold 44 % of all 7-series models in China, prompting the automaker to choose Shanghai as the backdrop for the launch of the refreshed version of its flagship sedan in January. BMW also took the opportunity to announce that it would start making the X2 in China this year, making it the 7th model to be localized there. That number is set to grow to 8 with the addition of BMW’s first full-electric crossover, the iX3, which will be built exclusively in China starting next year. BMW CEO Harald Krüger said he hoped that the U.S. and China would end their trade dispute. “It looks as if they will set aside their differences, and that would be positive for our China business”. Tariffs of 40 % on U.S.-built BMW SUV models cost his company a few hundred million euros last year. But it is not only German automakers that are at risk. Jaguar Land Rover swung from a profit to a loss of 273 million pounds in its fiscal third quarter that ended in December. Much of the loss was blamed on measures JLR took to address its own bloated inventories in China. Analysts peppered JLR China boss Qing Pan with questions during an earnings call in February. Eventually PB Balaji, finance chief of JLR parent Tata Motors, took the unusual step of shutting down further discussion, cutting off a Goldman Sachs analyst who sought further clarity on the issue. At least for now, the German premium brands say JLR’s problems are its own and point to their continued growth in the first 2 months, during which all 3 delivered more than 100,000 vehicles despite the Chinese New Year holiday. But beneath the surfaces, cracks are emerging. “The premium market is stable, but what we are seeing are other brands offering heavy discounts”, Porsche global sales chief Detlev von Platen said. “That might work if you are a volume brand, but not if you define yourself through exclusivity. We have no interest whatsoever in participating, so we are watching our stock levels very carefully to keep our supply aligned with demand”. Von Platen’s job will not be made any easier now that China is taking more drastic measures to tackle its massive air pollution. Carmakers this year will need to sell a certain number of ultra-low emissions cars called New Energy Vehicles (NEVs). The precise number depends on the size of their fleet. In addition, all OEMs will have to meet next year’s fuel consumption targets. This has caused market researcher LMC Automotive to question whether weaker volume brands such as Peugeot can survive in a lower-growth market dominated by VW as well as a number of Asian manufacturers such as Honda, Toyota, and domestic brand Geely. BAIC Chairman Xu Heyi, whose own flagship brand sells fewer cars in China than its JV partners, Mercedes-Benz and Hyundai, was blunt about the struggles of some European competitors. “The Chinese market has its own conditions and some of these foreign brands might not have a very detailed and fully comprehensive understanding”, he told reporters at the Geneva auto show. “Perhaps the team is not talented enough or smart enough”. While undoubtedly challenging, most automakers view the current downturn as a temporary problem that will recede once the U.S. and China settle their trade differences. VW Group, which gained 1 percentage point share of the market last year despite an absolute decline in volumes, actually welcomes the slowdown. The group, which controls 18.5 % of the passenger car market, views the tough times as an opportunity to expand its control as weaker competitors falter. The real concern cited by executives is whether their companies can successfully position themselves for the transformation to full-electric, fully connected and, eventually, autonomous cars in China. Nowhere else is technology developing at such a rapid pace, they say, and new competitors are swiftly becoming a threat to their business. “Just look at how fast China switched to e-scooters. It happened within a couple of years”, Thomas Ingenlath, CEO of Volvo subsidiary Polestar, said. Audi, for example, will unveil a new strategy next month that will focus on 5 core pillars. Developing products that appeal to Chinese customers and secure its leadership of the country’s premium segment is the top priority, Audi boss Schot said. The brand has said it aims to nearly double its sales to 1.2 million by 2023. “I’m in it for the long run”, Schot added. “If I get nervous and want to chase volume, I destroy my P&L”. To fund the enormous investments in technology needed to stay relevant in China, Audi plans to cut its overall costs by €13 billion by the end of 2022. That will come in addition to the roughly €2 billion already achieved last year under its Audi Transformation Plan. One newcomer to the topic of cost cutting is Porsche. The sports car manufacturer justified its first efficiency program since nearly filing for bankruptcy in the early 1990s by citing the threat posed by Chinese upstarts; not just in this key market but eventually worldwide. Traditionally, Porsche prefers to quietly work on its costs every year. Recent events convinced senior executives that it needed to launch a cumulative €6 billion efficiency plan over 6 years to wake up middle management, even though it long eschewed these announcements as a sign of a company in crisis. “In the past that was the case. Now I believe it’s irresponsible to act otherwise”, Porsche CFO Lutz Meschke told. “We know exactly what challenges we will face, what new competitors are emerging in China in the meantime with what kind of cost base and state support”. Departing Daimler CEO Dieter Zetsche found out the hard way just what Meschke means. Chinese automotive tycoon Li Shufu, owner of the Geely, Volvo and Lotus brands, became Daimler’s largest shareholder last year when he bought a 10 % stake in the company. Zetsche and Li agreed last October to form a premium ride-hailing JV and are currently exploring further areas of cooperation. For automakers, there is no country that can pick up the slack for a market of roughly 24 million cars. Even India, with its 1 billion-plus population and comparably low vehicle density, only last year surpassed Germany’s 3.4 million in overall annual volume. “China is a Goldilocks economy and finding the rare set of circumstances that led to the Chinese economic boom elsewhere in the world is unlikely”, said May Arthapan, director of Asia Pacific forecasting at LMC. The good news is she believes China could be in the midst of a shift, a type of temporary valley where growth driven by Tier 1 and Tier 2 cities has largely peaked before smaller urban centers take off in a “second wave of mass motorization”. Tier 3 cities such as Huzhou and Nanyang might only have a per capita GDP that is a fraction of Beijing or Shanghai and only 40 % of the people. But there are far more of them. “Given that 81 % of the Chinese population resides in Tier 3 to Tier 6 cities, these locations represent a massive source of potential future growth”, Arthapan said. Young families with a limited budget in these smaller cities are exactly the customers VW Group hopes to attract with the new Jetta entry brand. The car that established the brand’s credentials in the market will be spun off to form a new family of entry models. The Jetta brand’s lineup will include a rebadged version of the sedan as well as 2 new SUVs. The trio will debut this month at the Shanghai auto show ahead of their third-quarter launch. More than 30 years after VW’s Hahn set up operations in China, the group’s current CEO acknowledged that he will use this year to re-evaluate its entire footprint there. This could include the issue of a possible JV majority ownership, assuming VW can afford it. By early next year at the latest, Diess aims to deliver an answer. “There is a need to act, quite simply”, he said. “I consider it the most important strategic task facing Volkswagen to secure our future”. +++ 

+++ Last September, 2 months before his arrest in Tokyo, then-Nissan chairman Carlos GHOSN and the carmaker’s chief executive officer considered bringing in a new partner for the alliance with Renault and Mitsubishi, according to an email. At the time, Ghosn was under pressure to make the 3-way automobile alliance “irreversible”. In a message to Ghosn, Nissan CEO Hiroto Saikawa wrote that he had been working over the summer “quietly by myself”, at his boss’s request, to find a structure that would be “acceptable for both sides”. He offered to discuss possibilities with Ghosn. In the correspondence, Saikawa raised the possibility of bringing in another manufacturer as a 4th partner for the alliance. He didn’t identify any potential candidate. He wrote that expansion opportunities also included “acquisition of Chinese companies” for electric vehicles or connected services. The email casts light on the private discussions between the 2 men on the way forward for the French-Japanese alliance, which together is one of the biggest automakers in the world. Internally, Saikawa had argued against a full merger and that Nissan should remain independent or be the dominant force in any deeper union. He told that Nissan wanted to maintain the 3-way alliance. Ghosn, who was chairman of all 3 companies, is now awaiting trial for financial crimes after spending 108 days in Tokyo Detention House. He has denied charges and blamed a “plot” against him by Nissan executives trying to prevent closer integration with Renault. Nissan spokesman Nicholas Maxfield said the company doesn’t comment on, or confirm or deny, the content of internal communications. He said he wouldn’t comment on “matters potentially related to pending judicial processes”. Representatives for Ghosn’s family and Renault declined to comment. In the message to Ghosn, Saikawa advises changing the alliance’s structure in 2019 “rather than wait”. 7 months before, Ghosn had pledged to cement the partnership, a promise that came after France, Renault’s most powerful shareholder, had demanded deeper ties with Nissan. Yet a move for closer relations faced resistance from within Nissan, which feared Renault would gain even greater sway. Already their shareholding is lopsided, with Renault owning 43 % of Nissan compared with the Japanese carmaker’s 15 % stake in Renault. Their partnership has been under further strain since Ghosn’s Nov. 19 arrest. In considering bringing in a 4th partner for the alliance, Saikawa’s email also highlights the pressure carmakers are under to grow amid an expensive shift by the industry to electric and self-driving cars. Renault wanted to pursue the idea of a merger with Nissan, before a tie-up with another partner, possibly Fiat Chrysler Automobiles. Saikawa denied any deal-making talks, and said he was unaware of any such move by Renault. The French carmaker declined to comment and the government downplayed the report. In a bid to restore trust, Renault and Nissan earlier this month unveiled a new board to govern their alliance. +++ 

+++ JAGUAR is on the cusp of deciding whether the next F-Type will be a full-blooded petrol-engined car or a dramatic, futuristic first take on a battery-electric vehicle designed to act as a ‘halo’ for future mobility. Jaguar design director Ian Callum said: “We’re asking ourselves if it should be a final hurrah for the old-school sports car that we know and love, or to switch now to make our first all-electric sports car”, said Callum. “It’s a very difficult decision. What I will say is that the electric decision is looking more interesting with time”. Although the F-Type is expected to be on sale for at least 3 more years, Callum confirmed that the development cycle for its successor would have to begin soon, suggesting a new car is around 3 years away from making production. Callum admitted that the performance of the I-Pace had forced him to rethink his views on electric cars, although he stressed that the final decision on which technology to use would not be down to him. “The performance capabilities of an electric car are not an issue”, he said. “The kick from an electric car is quite beguiling, and if you adapt your mindset to enjoying that (driving slower into corners but getting the thump when you hit the throttle earlier) it’s every bit as enjoyable as a V8 engined car in many respects. “The dynamics we know we are strong at (Mike Cross and his team don’t make anything other than first-rate cars in that regard) and despite the challenges of mass, the I-Pace is already proving that electric cars can be dynamically entertaining. “Then there’s range, but that is becoming less of an issue, and there are advances coming that should help move that on again in the next few years. So the main challenge remaining is the inherent raising up of a car required by the packaging of the batteries. But I see that as an interesting challenge, not an insurmountable one”. Callum’s comments also confirm that Jaguar will have a sports car in its line-up in future, after doubts were raised because of the relatively low sales of the F-Type compared with the class-leading Porsche 911. “We will always do sports cars”, he said. “End of story”. Callum added that saloons (or liftbacks) were also pivotal to Jaguar’s standing. Again, the firm’s saloon car range has been under pressure as a result of slow sales relative to its premium competition. “I can’t see a day when Jaguar won’t make saloons or, perhaps, liftbacks, either of which I regard as core to the DNA”, he said. “You can take any of our SUVs, electric or otherwise, and they will do a fantastic job for you. But some people will always want better aerodynamics and greater efficiency, and some people will always want the additional thrill from the dynamics that a car inherently does better than an SUV”. +++ 

+++ In JAPAN , the nation’s automotive industry is in fierce competition over acquiring information technology professionals. With the auto industry in the middle of a major change that comes only once in 100 years, companies are facing an urgent need to secure industry-ready employees capable of handling the fast-moving technological innovations, such as artificial intelligence. Automakers that established research and development bases in rural areas of Japan in the past have newly created such bases in the Tokyo metropolitan area, where there is a high concentration of IT engineers. According to the 2018 white paper on IT human resources by the Information-Technology Promotion Agency, an independent administrative agency, over 90 % of responding companies either strongly or somewhat felt a lack of IT specialists. Yoko Yoshida, head of the IT sales division of a major IT employment information website operated by Mynavi, said that the companies looking for IT specialists have diversified during the past few years. “There are not very many cases in which people go as far as moving to rural regions to change jobs”, she added, stressing that office location is a big factor for people choosing jobs. Responding to this preference, Toyota established a new company in Tokyo’s Nihonbashi district in March 2018 to develop self-driving technology, aiming to acquire IT personnel from both in and outside of Japan. In June last year, Yamaha, which is looking to boost its robot operations, opened a base for advanced technology development in Yokohama. Automotive parts maker Denso consolidated several R&D bases from Aichi Prefecture and other locations to Shinagawa Ward, Tokyo, in April 2018. Hajime Kumabe, an executive director at Denso, said that the company had faced tough competition to secure IT engineers. Since the move to Tokyo, the number of applications it receives from work-ready people has increased. Japan’s industry ministry estimates that the sense of shortages of human resources in the IT area will grow among companies. In November last year, Nissan partnered with the Yokohama City University in the hope of developing IT professionals. In the future, automakers may face also issues training their engineers, as well as a fight to secure such employees. +++ 

+++ A special panel including experts has urged NISSAN to abolish the post of company chairman, following a series of alleged misdeeds by former Chairman Carlos Ghosn. In its final report, the panel called on Nissan to switch at the end of June to “a company with 3 statutory committees” where important management decisions are made mainly by outside board directors. The governance reform panel concluded that the excessive concentration of power in Ghosn led to his wrongdoing. The report was submitted to the Nissan board of directors. The panel proposed that a majority of board directors be selected from outside of Nissan, in order to strengthen the board’s oversight of the firm’s management. Currently, Nissan has 9 board members, including Ghosn. Only 3 of them are outside directors. The board of directors will review the panel’s proposals “with the greatest attention as soon as possible” and will “proceed with plans to improve the governance structure”, Nissan said in a statement. The special panel, set up after the revelation of Ghosn’s misconduct, is coheaded by lawyer Seiichiro Nishioka, former chief of the Hiroshima High Court, and Sadayuki Sakakibara, former chairman of the Japan Business Federation (Keidanren), the nation’s largest employers group. The 3 outside board directors of Nissan are among the 7 members of the panel. “There were problems in Nissan’s governance system”, Nishioka said at a press conference in Yokohama. The report said that “the primary root cause” behind Ghosn’s misconduct was “the concentration of all authority” in him, including on personnel and compensation issues. The panel thus urged Nissan to adopt a new governance system in a bid to prevent its board from becoming dysfunctional again, due to possible concentration of power in a single executive. The report proposed a total of 38 reform measures. While Nissan is a company with a board of auditors, a system adopted by many Japanese companies, the report said, “It is necessary to establish the best practices which are internationally comprehensible”. The panel urged Nissan to shift to a company with nomination, compensation and audit committees, with outside directors making up the majority of members on each of them, a governance system adopted by many Western blue-chip companies. According to the Japan Association of Corporate Directors, 71 of all listed firms in Japan had the company with committees system at the end of February. The governance reform panel proposed that Nissan separate the post of the board’s chairman and that of company chairman, which had been concurrently assumed by Ghosn. While proposing that Nissan’s articles of incorporation and regulations of the board stipulate that the chairman of the board be an independent outside director, the panel urged the firm to abolish the post of company chairman, which it said has “a strong impression as being emblematic of the concentration of authority”. Also to prevent the concentration of power, the report called for banning the representative executive officer of Nissan, a new post that would be created in line with the firm’s expected transition to a company with committees, from concurrently serving as board director or executive or other officer of Renault, the French alliance partner of Nissan, or Mitsubishi, a Japanese automaker and also member of the alliance. The panel did not mention the possibility of a review of the capital partnership between Nissan and Renault. “It’s not appropriate to go into the matter”, Nishioka told the press conference. Ghosn has been indicted for allegedly failing to report part of his executive pay from Nissan in the firm’s financial statements, in violation of the financial instruments and exchange law, and on suspicion of aggravated breach of trust by the transfer of a personal financial loss to the firm, against the companies law. He was dismissed as Nissan chairman days after his first arrest on Nov. 19 last year. Ghosn was released on bail earlier this month, after being detained by Japanese authorities for more than 100 days. Following the scandal, Ghosn resigned as chairman and chief executive officer at Renault. He was relieved of the post of chairman at Mitsubishi late last November, after his first arrest. Renault is the top shareholder of Nissan, with a stake of about 43 %. Nissan owns about 15 % of Renault, but its equity stake in the French company carries no voting rights. Nissan apparently hopes to change the situation. +++ 

+++ PORSCHE previously announced the next-generation Macan will be exclusively offered with an electric powertrain. 4- and 6-cylinder engines are out of the question, but the line-up could grow to include more body styles, the company confirmed. “During the development of the model, we also look directly at possible body variants. The 5-door SUV is the most important, but a coupe version or a variant with more space can also be interesting”, said Michael Steiner, Porsche’s board member for research and development, in an interview. The coupe model he alluded to would likely arrive as a 4-door SUV with a fastback-like design, not as a proper 2-door coupe. It could look like a smaller version of the Cayenne Coupe unveiled recently. The variant with additional space is more enigmatic; we expect it would be a long-wheelbase model developed largely for the Chinese market, but Steiner stopped short of providing additional details. Interestingly, he also revealed Porsche will offer the electric Macan with several powertrain configurations. “There are various variants of the electric Macan. We are still looking at the names, because of course an iconic name like Turbo does not suit an electric car”, he said during the interview. Porsche has time to figure out what to call the different variants, production of the next-generation Macan won’t begin until the early 2020s. However, his comments suggest none of the firm’s upcoming battery-powered models will wear a Turbo emblem. This contradicts an earlier report claiming the range-topping Taycan would be called Turbo, in line with Porsche’s gasoline-powered range-toppers. +++

+++ +++ The TESLA Model 3 was Europe’s best-selling premium midsize sedan in its first full month of sales, outselling sedans such as the Mercedes-Benz C class from German premium automakers. Tesla sold 3,630 Model 3 cars in the region in February. Among the Model 3’s internal combustion engine rivals, the Mercedes C-class sedan was closest with 3,420 sales. Audi sold 1,710 units of its A4 sedan and BMW sold 1,700 units of the 3 series. The numbers are for sedan sales only. They exclude body styles such as stationwagons. The popularity of wagons in Europe mean sedans only account for a quarter of 3-series and A4 sales, and a third of C-class sales, according to JATO data. The Model 3 outsold the Alfa Romeo Giulia, the Jaguar XE and the Lexus IS, which are only available as sedans. The Model 3 was also the top-selling full-electric car in Europe in February, outselling the Renault Zoe, which sold 2,884 units and the Nissan Leaf with 2,333 sales. The Model 3’s early success puts further pressure on European premium brands after Tesla’s Model S was Europe’s top-selling upper-premium sedan last year. Tesla sold 16,508 units of the Model S in the region in 2018, outselling the top3 nearest rivals: the Mercedes S class with 12,079 sales; the BMW 7 series with 9,575 sales; and the Porsche Panamera with 9,515 sales. The Model 3 will soon face increased competition from German premium brands as they launch their new long-range full-electric cars. The cheapest Model 3 sedan costs €53,800 in Germany with twin engine, 4-wheeldrive and a long-range battery pack rated to give a range of 537 km, according to Tesla’s website. The price includes local incentives. The Performance version of the same car costs €64,600. A cheaper car with a smaller battery will be available late summer/early autumn, Tesla CEO Elon Musk said in March. The success of the Model 3 helped to increase European sales of full-electric vehicles by 92 % to 20,000 in February. “The performance of the Model 3 is remarkable, given we normally don’t see this kind of result until 4 or 5 months after a new car has hit the roads”, said Felipe Munoz, JATO global analyst. Tesla will next year start sales of the Model Y crossover version of the Model 3 in the U.S. Higher-end versions will be delivered starting in autumn 2020, while a standard version will be available in spring 2021, Tesla has said. Tesla will start to build Model Y cars to export to Europe in early 2021, Tesla said. In Germany, the Model Y will start at €56,000 for the rear-wheel drive car with the long-range battery, Tesla said on its website. The dual-motor version will cost €60,000, while the Performance model of that car will cost €68,000. Demand for SUVs is still growing in Europe and in February SUVs took almost 37 % of all sales. SUVs, light commercial vans and sports cars were the only segments to grow in February. +++ 

+++ China’s State Council said that the country would continue to suspend additional tariffs on U.S. vehicles and auto parts after April 1, in a goodwill gesture following a decision in the UNITED STATES to delay tariff hikes on Chinese imports. In December, China said it would suspend additional 25 % tariffs on U.S.-made vehicles and auto parts for 3 months, following a truce in a trade war between the world’s 2 largest economies. The State Council, or cabinet, said the move was aimed at “continuing to create a good atmosphere for the ongoing trade negotiations between both sides. It is a positive reaction to the U.S. decision to delay tariff hikes and a concrete action adopted by the Chinese side to promote bilateral trade negotiations. We hope the U.S. can work together with China, accelerate negotiations and make concrete efforts towards the goal of terminating trade tensions”. The government also said it would announce separately when the suspension would end. U.S. President Donald Trump said that trade talks with China were going very well, but cautioned that he would not accept anything less than a “great deal” after top U.S. and Chinese trade officials wrapped up 2 days of negotiations in Beijing. U.S. Treasury Secretary Steven Mnuchin and U.S. Trade Representative Robert Lighthizer were in the Chinese capital for the first face-to-face meetings between the 2 sides since Trump delayed a scheduled March 2 increase in tariffs on $200 billion worth of Chinese goods. The talks are set to resume next week in Washington with a Chinese delegation led by Vice Premier Liu He. +++ 

+++ The VOLKSWAGEN Golf is celebrating its 45th birthday this week, having officially commenced production in Wolfsburg on March 29, 1974. With 35 million units sold globally in the time since, Volkswagen says a Golf has been ordered “every 41 seconds” since 1974, equating to an average of 780,000 units per annum. 7 generations have launched over those four and a half decades, with the Mk8 due to be revealed before the end of this year. In addition to the Wolfsburg plant, which still produces the iconic hatchback to this day, the Golf is manufactured at 5 facilities across the globe across Germany, Brazil, China, and Mexico, and exported to 155 nations. Since its humble beginnings as a replacement for the original Beetle, the Golf has since grown from the ‘people’s car’ to a ‘premium for the people’ offering, challenging rivals from mainstream and luxury segments, including the related Audi A3. +++

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