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+++ BENTLEY will finalise its new model strategy by this summer, with a renewed focus on its credentials as a maker of grand touring vehicles and SUVs, and no pure sports cars. Werner Tietz, Bentley’s board member in charge of engineering, has revealed that the company has decided not to pursue any of the themes explored by the EXP 10 Speed 6 sports car or electric EXP 12 Speed 6e roadster concepts shown by its former management. Instead, the Crewe firm, now led by Adrian Hallmark, will look to expand its GT lineup. “The concept positioning was not something that fits with our future strategy now”, said Tietz. “Pure sports cars are not a topic for us now. Since joining, our first move has been to work on the current range, and to set a better cadence for launching products at spaced intervals. Now we are looking at what future possibilities there are”. Tietz declined to elaborate on specifics, but said any new products would need to broaden the firm’s spectrum of buyers, rather than sell additional cars to them. “The first thing we want to be sure of is that we have a GT car in every segment and it is not certain if we are there now”, he added. “There is more potential in that segment, I think. Bentley can offer something unique, particularly around delivering cars with a sport edge that can, at the push of a button, transform into a luxury, refined car. There is some potential when you look at SUVs too, especially around a car larger than the Bentayga if you consider its value to the Chinese and American markets. So, yes, that is one opportunity we are exploring. Bigger cars are an interesting avenue for Bentley. For now, we are not thinking about doing anything smaller, as that’s not what we’re about”. Reports had suggested that Tietz was considering a smaller, battery-electric crossover as an urban-focused model, but he said: “We are investigating several concepts for electrification, but for now the promise is that we will offer a plug-in version of every car we have on sale today by 2025. Our research suggests that is what customers want now. “An electric, city-focused car is one idea we are thinking about, it’s true. But it is just a concept in our minds. But would an electric car have to be a new car line, or a successor to something we already have? What kind of range does an urban car need to have? There are so many directions we need to consider rather than just saying ‘we will make an electric car’ ”. Tietz added: “It is by no means certain that battery-electric is the right way to go. One point we see is that some cars in our line-up, the Bentayga for instance, is used for towing horseboxes and boats. With the current EV technology, that wouldn’t work. “So we are looking for a step in technology that doubles battery capability. We have looked at solid-state batteries for nearly 5 years now: they should be able to achieve these goals, but they are not yet ready. If solid state achieves its goals, then it becomes interesting, but only then. “That’s why we are also evaluating fuel cell technology constantly, even if it is probably 10 years away from reaching a point that it can be practical, and also seeing what possibilities there are with the development of synthetic fuel”. Tietz highlighted the potential for synthetic fuels to be made using clean energy, such as wind power, as being especially appealing. “The evidence is that these fuels could be CO2 neutral, and that raises interesting possibilities”, he said. “We see the airline industry looking into this quite seriously (the electric plane doesn’t look like becoming a large-scale reality soon) and that could help us open up possibilities. We have open minds”. Tietz said Bentley would give clues to its future direction at events coinciding with its 100th anniversary celebrations in July. +++ 

+++ Securing enough nickel is a major worry for electric vehicle firms, an executive from Chinese electric car and battery maker BYD said, adding that the company would welcome joint ventures that help guarantee supply. Nickel is one of several metals that are key components of electric vehicle (EV) batteries. A shift in battery chemistry toward higher nickel content, which would allow cars to go further on a single charge, is expected to boost demand further. “The supply of nickel going forward is a big concern in everybody’s mind”, said Coco Liu, procurement director at BYD. BYD counts Warren Buffet among its investors and is also Daimler’s partner in China. Analysts had earlier told the conference that the market would be short of nickel if Chinese-led projects in Indonesia fail to deliver. BYD looks not only for suppliers who can provide high-quality products but also those who have experience in setting up joint ventures covering the whole EV value chain from upstream mining to precursor battery materials and finished products, Liu said. Joint ventures are “a good way to go forward” and can save costs, she said, adding that BYD prefers to have diversity in its supplier base to reduce risks. Liu said buying shares in a mine requires a large investment and entails risks, despite a potential rise in demand for raw materials for battery. “We hope despite the volatility we can have a secure, stable supply with a relatively steady price. Then it will help with our final product sales and development”, she said. +++

+++ In CHINA , auto sales fell again in March but the pace of decline was the smallest in 7 months, industry data showed, as car makers reduced retail prices to boost business after Beijing handed out tax cuts to spur consumer spending. Sales fell 5.2 % from a year ago to 2.52 million vehicles, the China Association of Automobile Manufacturers (CAAM) said, marking the 9th straight month of decline in the world’s largest auto market. But this was the smallest drop since August 2018. “We saw a warmer recovery in March. We are optimistic and hope to see the turning point appear in around July and August” said Xu Haidong, assistant secretary general at CAAM, the country’s biggest auto industry association. Recent government cuts to value-added tax (VAT) are expected to further benefit car sales, Xu added. “The VAT cut can drive production and employment, so an effective implementation of the policy can bring warmth to the market”. China has cut VAT for the manufacturing sector to 13 % from 16 %, prompting some car makers such as BMW and Mercedes-Benz to lower prices. “We expect China’s auto market to see positive growth in the third quarter and a relatively large increase in the fourth quarter”, said Alan Kang, Shanghai-based analyst at LMC Automotive. In 2018, China’s car market hit reverse for the first time since the 1990s against a backdrop of slowing economic growth and a crippling Sino-U.S. trade war. However, new energy vehicle (NEV) sales have remained a bright spot, jumping almost 62 % last year even as the broader auto market contracted. Last month, NEV sales rose 85.4 % to 126,000 units, the CAAM said. China has been a keen supporter of NEV (pure battery electric, hybrid and plug-in hybrids) and has started implementing NEV sales quota requirements for automakers. After rolling out a generous 5-year NEV subsidy program in 2016 to support sales and encourage innovation, Beijing recently pledged to phase it out by 2020 and raise standards for vehicles eligible for subsidies amid criticism some firms have become too reliant on the funds. +++

+++ Geely, China’s highest profile car maker with investments in Volvo and Daimler, launched a premium all-electric car brand GEOMETRY as it pushes ahead with its plans to boost production of new energy vehicles. The move comes as automakers race to develop vehicles powered by means other than petrol to meet an expected rise in demand as the world’s top car market enforces official production quotas designed to reduce smog. Geometry will take overseas orders but will mainly focus on the Chinese market and will launch more than 10 pure electric models in multiple segments by 2025, Geely said in a statement. The company added it had already received more than 26,000 orders globally for its first model, the Geometry A. The longer-range version of the model has an ability to travel up to 500 kilometers on a single charge, Geely said. Geely launched Geometry at an event in Singapore and said the city-state would eventually become a target market. “The launch of Geometry and its first product advances Geely’s strategic goal of becoming one of world top 10 automotive groups”, An Conghui, president of Zhejiang Geely Holding Group, said in the statement. Geely set up a new joint venture with Germany’s Daimler just last month to build the next generation of Smart electric cars in China. Smart is Daimler’s small-car brand. Geely is also developing new energy commercial vehicles like pickup trucks at another unit, Yuan Cheng Auto. China has been a keen supporter of new energy vehicles (NEV) including pure battery electric, hybrid, and plug-in hybrid technologies, and started implementing NEV sales quota requirements for automakers. Global automakers are planning a $300 billion surge in spending on electric vehicle technology over the next 5 to 10 years, with nearly half of the money targeted at China. Geely posted sales growth of 20 % in 2018. However, it is forecasting largely steady sales this year as the country’s giant auto market struggles with slowing economic growth and more cautious consumers. Last year, the overall market contracted for the first time since the 1990s. The Chinese carmaker bought Volvo in 2010 from Ford in what was China’s biggest acquisition of a foreign car maker at the time. +++ 

+++ The Tokyo District Court said it had extended Carlos GHOSN ’s detention period by 8 days, giving prosecutors until April 22 to bring formal charges against the former Nissan boss or let him go. Ghosn was arrested for the 4th time last week on suspicion that he had tried to enrich himself at Nissan’s expense, to the tune of $5 million. He is also awaiting trial on other charges of financial misconduct and aggravated breach of trust. Ghosn, who had been released on $9 million bail in early March after spending 108 days in jail, has denied all allegations against him. Ghosn’s initial detention period was set to expire on Sunday, and had been widely expected to be extended by the maximum 10 days. Public broadcaster NHK said it was rare for prosecutors’ full extension request to be denied and shortened. Ghosn’s defense team has launched a public and fierce battle against Tokyo prosecutors, calling the latest arrest “illegal”. Once celebrated as a savior of a near-bankrupt Nissan 20 years ago, Ghosn has been ousted as chairman of Nissan, Renault and Mitsubishi since his arrest, jeopardizing the auto-making alliance he masterminded. +++ 

+++ HONDA ’s sales in China are likely to catch up with its sales in the United States within 2 to 3 years and the firm would like them to eventually overtake U.S. sales, the company’s chief executive said. Takahiro Hachigo made the comments to a small group of reporters after the official opening of a new plant in Wuhan. Hachigo said that the catch-up could happen “soon”, later clarifying that he was referring to a 2 to 3 year time period. “We would like China sales to overtake the U.S.”, he said, adding that the company did not expect U.S. sales to increase significantly. Honda’s manufacturing capacity in China could be expanded if necessary, he added. Honda last year sold roughly 1.7 million vehicles in the United States and 1.4 million in China. +++

+++ MAZDA ’s success in selling SUVs has left the automaker at risk of heavy fines for missing European CO2 reduction targets. Last year, Mazda pooled its CO2 emissions in Europe with Toyota’s to avoid a fine for missing an EU mandated reduction target. The automaker declined to comment on whether it would pool with Toyota this year to lower its fleet emissions. The success of the CX-5 is pushing up the automaker’s average emissions in Europe, CEO Akira Marumoto said. SUVs have higher emissions than Mazda’s traditional core models, the 3 and 2. Sales of CX-5 and the smaller CX-3 accounted for more than half of Mazda’s European 228,210 vehicle sales last year. CX-5 sales rose by 17 % to 69,196 and CX-3 sales increased 4 % to 55,192. Mazda is also adding another SUV, the CX-30, in September in Europe. Mazda will not reach its EU mandated target to cut its average fleet emissions to 94.1 grams per km in 2021, a report by PA Consulting said. Mazda’s emissions will fall to 98.1 g/km in 2021 from 131.2 g/km today, leaving the automaker at risk of a €75 million EU penalty, the company said. To meet future CO2 reduction goals, Mazda will count on emissions-reducing technologies such as its new Skyactiv-X gasoline engine with spark-controlled compression ignition, as well as plug-in hybrids and an upcoming full-electric car. The recently launched Mazda3 will be the first model to get the Skyactiv-X engine, followed by the CX-30. The engine has CO2 emissions of less than 100 g/km, Marumoto said. Mazda will launch a full-electric car in Europe next year, using its own technology. The EV will allow the automaker to reduce its CO2 average because it will have zero emissions and it will allow Mazda to claim so-called “supercredits” for vehicles with emissions below 50 g/km. Marumoto declined to give any details of the model except to say it will have a design different from the typical EVs currently on the market. Motoring press reports say it will likely have a crossover design. After 2022, Mazda is expected to launch EVs with technology developed by a joint venture it is joining with Toyota and Denso. Starting in 2021, Mazda will offer plug-in hybrid models, but it has not given any more information about these cars. Mazda will face a big hurdle next year when its emissions-reducing technologies will have only a partial impact on reducing CO2 while at the same time the EU expects automakers to have 95 % of their vehicles compliant with their mandated target by 2020 with full compliance required by 2021. The EU has set an industrywide target for average CO2 emissions from new cars to be cut to 95 g/km but each automaker has an individual weight-based target and they are allowed to pool emissions. The EU fines are 95 euros for every gram over the target, multiplied by the number of vehicles sold. Toyota will easily meet its CO2 target of 95.1 g/km in 2021 because 72 % of its new-cars are hybrids, PA Consulting said. Toyota’s emissions will drop to 87.1 g/km in 2021 from 103 g/km today, the company predicted. Marumoto said Mazda will have “some difficulties” in reaching its EU mandated target for 2020 and might have to pay the EU fines. The automaker would rather pay the fines than curtail its new-car sales to protect dealer profitability, he said. “We will have to balance the impact of possible CO2 penalties with our sales targets, but we also have to consider the sustainability of our dealer network”, Marumoto told. +++

+++ In launching the 4th generation MAZDA 3 in Australia, visiting programme manager Kota Beppu said he wants a “hyper” version of the hatchback. “I’m a car guy, so I myself want to drive a high performance Mazda 3. I’ll do my best”, he said. Although he claimed the project had not been officially signed off, insiders suggest that is a formality. Beppu said there was keen interest from “most developed countries”, including the US, Japan and Australia. While various drivetrain configurations have been discussed, it is the turbocharged 2.5-litre engine from larger US-spec Mazdas that is the most likely powerplant. “Generally speaking we would use the motor to get more performance”, Beppu said in shunning a hot hybrid version. With 252 hp the 2.5’s output falls short of the latest crop of hot hatches, but 420 Nm brings its own challenges. “The Mazda 3 is a light vehicle, so if there is too much power and we keep it as front-wheel drive, there is the torque steer phenomenon happening”, he said, nominating the all-wheel drive that’s already developed for the new torsion beam rear end as an obvious solution. Beppu added that he doesn’t see any high performance Mazda 3 as a track-focused tearaway, instead suggesting the emphasis would be comfort and everyday road use. “It needs to be responsible and friendly; more friendly than a Golf GTI”, he said, though adding: “it should be fast”. He referred to such a car as a “hyper” Mazda 3 rather than a hot hatch. It remains unclear if the brand will therefore use the MPS or Mazdaspeed branding for such a model. But it is CO2 that is one of the biggest challenges for a hot 3, something that could challenge its European viability. The forced induction 2.5-litre engine is not currently sold in the region, and might not meet the efficiency requirements to do so. The is clear interest from the crucial US market, however, which has its own R&D centre in Los Angeles and has reportedly created a proof-of-concept machine under the radar of the brand’s Hiroshima head office. Mazda last sold a hot 3 with the second generation car in 2013, under the MPS tag in Europe and badged as a Mazdaspeed. +++

+++ The South African arm of NISSAN will spend 3 billion rand ($213 million) equipping its local plant to build the Japanese carmaker’s new Navara model, the unit’s boss said. Capacity at Nissan’s plant in Rosslyn, near Pretoria, will increase by 30,000 units in the first phase, Mike Whitfield, managing director at Nissan South Africa said, while the plant’s permanent headcount will increase by 400. “Today, we’re able to announce that the Nissan South Africa Rosslyn facility will build the entire model range Nissan Navara for both local and export markets”, Whitfield said at an event to announce the investment. While production operations elsewhere will also build the new Navara, a pick-up, Nissan South Africa will supply the local and continental market. Whitfield said his unit had to beat other global Nissan production operations to win the right to produce the Navara; a victory for his unit and also South African President Cyril Ramaphosa ahead of elections in May. Ramaphosa, who was at the event on Wednesday, is trying to secure $100 billion in investment into South Africa within 5 years. While he has had some success, he is contending with a sluggish economy and a legacy of corruption and mismanagement, knocking confidence in Africa’s most industrialised economy. Ramaphosa said Nissan’s investment marked a “milestone” in his drive, and was a vote of confidence in South Africa. In common with many global carmakers, Nissan doesn’t currently have any significant production operations in sub-Saharan Africa outside South Africa, which it entered in 1963 and is the only substantial market for new cars in the region. However Nissan, and many rivals, are hoping that will change. A number have recently opened or committed to open plants elsewhere, including in Nigeria, Ghana and Kenya. +++ 

+++ Toyota released the fully remodeled RAV4 in Japan, marking the first launch of a new model of the globally popular SUV here in 3 years. With the fifth-generation series, Toyota revived the RAV4 in its product lineup for the domestic market after skipping the introduction of its preceding series due to sluggish demand, while selling the vehicles in other markets on the globe seamlessly. Toyota, which regards the RAV4 as one of its mainstay SUV brands, sells them in 180 countries and regions, with cumulative global sales reaching about 9 million units since its market debut in 1994. The fifth generation RAV4 is larger than its predecessors chiefly because it shares a platform with Toyota’s flagship Camry sold in the United States and other foreign markets. In particular, the new model boasts a large rear cargo space, Toyota said. Targeting activity and family oriented people in their 30s to 40s, Toyota offers both gasoline-only and hybrid versions with 2-wheel and 4-wheel drive power trains. All models of the new series feature as standard equipment the Toyota Safety Sense; a package of systems including one to prevent collisions with pedestrians and bicycles and keep the vehicle in the center of the driving lane. “The RAV4 is Toyota’s absolute core SUV model”, Moritaka Yoshida, executive vice president of the company, said. “We’ll cultivate a market again in Japan”. Toyota aims to sell 3,000 units of the new RAV4 each month. +++ 

+++ SKODA posted a 2.9 percent drop in global deliveries in the first quarter, pulled down by a decline in the Chinese car market, it said. Deliveries fell to 307,600 vehicles in the first 3 months of 2019, although Skoda said it recorded growth in Europe and Russia. For March alone, deliveries worldwide fell 5.0 percent to 114,200, Skoda said. +++ 

+++ TESLA and battery supply partner Panasonic announced that plans to expand the capacity of the latter’s battery production at the Nevada Gigafactory have been placed on hold pending indications of renewed demand for electric vehicles. The companies had originally planned to increase capacity from 35 gWh to 54 gWh by 2020. Now, the companies said, they will likely wait until at least that deadline before any expansion will take place. Panasonic is holding off on plans to invest in Tesla’s Shanghai facility. This is not a hard-and-fast timeline. A Tesla representative told that the companies will “continue to make new investments in Gigafactory 1, as needed”. Lower-than-expected first-quarter production and delivery volumes for Tesla have prompted skepticism from analysts and investors who point to the expiration of EV subsidies and fulfillment of Model 3 pre-order deliveries as significant contributors to the company’s slackening sales despite making its first round of deliveries of its new compact overseas (where those sales have contributed to as much as a quintupling of Tesla’s sales volumes in those markets). Tesla’s best hope for spurring additional volume is the production of its new Model Y crossover. Sharing chassis and battery architecture with the Model 3 sedan, the Model Y should contribute much-needed volume with limited additional investment. +++

+++ The head of TOYOTA ’s electric vehicle (EV) business told the automaker has received enquiries from more than 50 companies since announcing last week that it would offer free access to patents for EV motors and power control units. The executive also said Toyota aims to use partnerships to cut by as much as half the outlays for expanded electric and hybrid vehicle components production in the United States, China and Japan. “Until now we have been a tier 1 automaker, but now we also intend to become a tier 2 supplier of hybrid systems”, Toyota executive vice president Shigeki Terashi said. Supplying rivals would greatly expand the scale of production for hardware such as power control units and electric motors that are used in gasoline-electric hybrids, plug-in hybrids, fully electric vehicles and fuel cell vehicles, he added. Toyota last week outlined plans to offer automakers and auto suppliers royalty-free access to nearly 24,000 electrified vehicle technologies patented by the Japanese auto giant. In an interview at Toyota’s global headquarters in Toyota City, Japan, Terashi provided new details of Toyota’s strategy, and its anticipated impact on the company’s investment plans. By offering to supply rival automakers with parts used in Toyota’s gasoline-sipping hybrid vehicles, the Japanese automaker sees a way to slash capital outlay by roughly half for new plants required to build electric car components for future models, Terashi said. “We believe that this approach will reduce investment costs significantly”, he said. Terashi said Toyota projects a surge in demand for electrified vehicles globally as regulators insist new vehicles emit substantially less carbon dioxide, and that working with Toyota would offer others a low-cost path to compliance. Toyota’s internal goal is to sell 5.5 million electrified, Toyota-brand vehicles annually by 2030, up from about 1.6 million vehicles now, he said. Already, Terashi said, Toyota believes it could reach the 5.5 million target as early as 2025. The company is working on plans for a new round of capital spending to expand capacity for producing the hardware required. By offering to supply electric vehicle hardware, and the know-how to integrate it into vehicles, Terashi said Toyota wants to reduce its capital outlay, and create a new source of revenue. “We anticipate that there will probably be very few automakers who use our patents to develop their own hybrids from scratch, so by using our system and our components, and offering our support, we can work together to develop these cars”, Terashi said. In the last 20 years, Toyota has managed to dominate the global market for hybrid cars by constantly improving and lowering the cost of the technology it pioneered in the Prius, and keeping this expertise a closely guarded secret. Toyota’s new business foray underlines the challenges facing even the largest global automakers as they confront some of the most profound technological changes for automobiles in a century. Toyota is now trying to take advantage of its lead in refining hybrid vehicles, even as it runs behind global rivals such as Volkswagen and Tesla in bringing fully electric vehicles to showrooms. Since pioneering the Prius in 1997, Toyota has sold more than 13 million hybrids, which twin a conventional gasoline engine and electric motor, saving fuel by capturing energy during coasting and breaking and using it to power the motor. Roughly 15 % of Toyota’s annual global sales are hybrids, including the Corolla and the RAV4. Last year it sold 1.6 million hybrids globally, more than the 1.3 million all-battery EVs sold by Tesla Inc, Nissan and all other automakers combined. To meet the expected surge in hybrid demand, Terashi said he is planning to increase production capacity for hybrid components mainly by adding capacity at existing plants. Toyota has initially courted its partner automakers. It already supplies the plug-in hybrid system for Subaru’s XV / Crosstrek crossover model, and last month Toyota announced that it would be a global supplier of hybrid systems to compact car maker Suzuki. The success of the Prius has helped to brand Toyota as a maker of affordable, reliable green cars and has been key to the automaker’s reputation as a leader in low-emissions vehicle technology. Terashi brushed off the risk that Toyota could lose this edge by offering its hybrid technology to other automakers, arguing that it held a crucial, 20-year head start over its rivals. “Even if an automaker is able to develop and produce a car using our systems and parts which complies with emissions regulations, its overall performance would never be the same as ours”, he said. +++

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