Newsflash III

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+++ The investment needed to develop connected and autonomous vehicles will likely lead to mass consolidation of car companies globally, according to ASTON MARTIN boss Andy Palmer. However, he also believes that the 6 globally recognised luxury car makers today (including Aston Martin, with Lagonda set to join in 2022 when it launches an electric SUV) will thrive despite the challenges. Palmer said he believes many existing brands will have to form alliances, merge with or sell to rivals in order to survive. “We’re all developing similar technology costing billions and that’s nonsense”, said Palmer. “I think it is inevitable car companies will come together through mergers and acquisitions. The requirements will be too much for many of the firms involved. The business model of spending $1 billion to develop a car and then have to pile it high and sell it cheap with discounting in order to keep factories turning and maintain economies of scale is broken”. Today, most analysts put 14 conglomerates (of around 200 car companies globally, selling approaching 100 million cars between them this year) at the heart of the global industry: Ford, PSA Group, Tata, Daimler, VW Group, Honda, Toyota, GM, BMW, Nissan, FCA Group, Geely, Renault and Hyundai. However, the rise of Chinese brands that are beginning to take significant sales in their home market (the largest for car sales in the world) is set to disrupt that dynamic. “Yes, enlightened mega-companies like Toyota can develop technology alone and survive, but I feel many more companies will fall under the wing of such firms to the point that we have just 2 or 3 mega-companies dominating, in the way Boeing and Airbus do in the airline industry”, said Palmer. “Along the way I’m sure we’ll see newcomers, some who will succeed, some who will be bought and some who will fail. But the inevitability is that there will be mergers and acquisitions”. Mercedes-Benz and BMW are already collaborating on autonomous technology, while firms such as the VW Group and Toyota are seeking partners to share their electrified technology with. Palmer concedes that Aston Martin and Lagonda would have to forge partnerships to supplement its own advances in the new technologies, but added that the firm’s small size, relative agility and ultra-luxury status offered a bright future. “The 6 luxury car makers (us, Ferrari, Bentley et al.) represent just 3 % of global car brands and 0.06 % of all global sales, but being globally recognised as a luxury brand is an accolade that is hard to obtain and even harder to retain”, said Palmer. “If something becomes easy to access or create it becomes a commodity, and for mainstream car makers that is a very real risk, but for car companies that don’t have to sell one more car to help a parent firm’s bottom line, there are opportunities. Independent, luxury car makers like us can thrive by fighting against commoditisation and focusing on adding to our mythology. My prediction is that in 10 years’ time there will be no new players in the luxury sector. With Lagonda, there will be just 7 of us. But, conversely, I wonder if one of the luxury makers might be forced down into the premium sector just to add that one more sale to the bottom line”. Palmer also hit out at car companies and legislators that he feels are seeking to gain a publicity advantage by fast-tracking the development of autonomous technology onto cars driven by the public too soon. He did not specify which brands he was referring to, although he did highlight the recent announcement from EU legislators to fit certain safety equipment, including speed limiters, as standard from 2022, as well as highlighting the shortcomings of the current 3G, 4G and 5G networks. “Car companies have a moral obligation to do their best to strive for zero fatalities”, he said. “My argument is that must be done in a logical way which takes note of the fact that by far the biggest reason for accidents is driver distraction and error. We have to be careful that we don’t rush technology that adds to those issues. If we legislate around populist policies without thinking, then customers could end up being used in beta testing on public roads. In my mind, any company launching level 3 autonomous vehicles (where a human has to be ready to take back control of the vehicle) is reckless. That is why we, and others, will move straight from level 2 to 4. Those that don’t, risk being reckless. The recent European regulations around speed control risk more accidents by causing more distraction around speed controls. I understand geo-fencing areas around schools and hospitals, for instance, and enforcing lower speed limits there, but when the technology isn’t there to support the ambition then blindly applying something because it gets soundbites and votes is wrong”. +++ 

+++ The under-threat AUDI TT may have a future after all, after it emerged that the company’s technical boss is trying to convince his fellow board members to develop a successor to the sports car with pure-electric power. The prospects for Audi’s iconic small sports car, which made its debut more than 20 years ago, have been increasingly in doubt thanks to modest overall sales and ever-tightening CO2 emissions legislation. Audi sources have suggested that one idea could be to develop a 4-door ‘TT Sportback’ successor to the current Mk3 model. However, Audi’s recently appointed board member for technical development, Hans-Joachim Rothenpieler, said that he is “fighting” to keep a 2-door sports car in the line-up. “At Audi, we need cars like the 2-door TT”, Rothenpieler told. “It is in the DNA of our brand. I’m really fighting for this car and I’ll try to convince my colleagues that we have to do it. But there is a second point, a second story. We have to move all of those cars, like the TT, into an electrified future. The current status with this car and its platform is that it is prepared only until EU7 (even tougher emissions regulations that could kick in by 2021, red.). We have started a discussion now about what’s happening after that point, but there’s also another debate, which I actually believe is significantly more important, on how to have cars like the TT with electric technology. We need answers to both of these issues”. Rothenpieler admitted that talks on the TT’s electrified future include the idea of both plug-in hybrid and pure-electric models. However, he also revealed that the discussions on a battery-electric version are at an advanced enough stage for different layouts to be under consideration. “For cars like the TT, the battery in the floor is a problem”, he said. “Normally in a pure-electric car, you have a wheel at each corner and the battery pack in the centre, and the pack is 12 or 13 centimetres tall. But this makes the base of the seating point higher. So for small, sporty cars with only 2 seats, we need a different concept, such as one bit of the battery in the centre of the car and another bit in front of the front wheels, or behind the rear wheels. Either way, we end up splitting the battery. And that’s what we’re looking at for these iconic cars. That’s a solution that could work, perhaps”. The boardroom battle on the future of Audi’s sports cars also includes the R8, although its prospects are also likely to be linked to what happens with the smallest Lamborghini supercar on sale, the Huracán. Rothenpieler added: “It’s the same with the R8, really. We have been talking about the R8 and the TT, but when we presented the e-tron GT, it’s an iconic car as well, a real statement. For me, the e-tron GT was the first step towards having an electrified car with Audi Sport RS in its DNA. It’s a bit bigger, that car, so it was still possible to use the normal battery layout. But if we talk about R8 then yes, we have to divide the battery system, in the same way as we have to with the TT”. +++ 

+++ Tesla has announced an update to its Navigate on AUTOPILOT system that will eliminate the need for drivers to manually confirm lane changes. The company says the system has performed more than 9 million suggested lane changes during more than 66 million miles with Navigate on Autopilot active. The new ‘seamless’ feature must be enabled through the customization settings. If a driver selects ‘no’ to Require Lane Change Confirmation, the car will change lanes automatically without requiring confirmation first. To help drivers remain aware of Autopilot’s lane changes, an optional notification will activate an audible chime, visual prompt, and steering wheel vibration for certain newer cars. “This feature does not make a car autonomous, and lane changes will only be made when a driver’s hands are detected on the wheel”, the company warns. “As has always been the case, until truly driverless cars are validated and approved by regulators, drivers are responsible for and must remain in control of their car at all times”. +++

+++ A new first-of-its-kind rechargeable BATTERY will give electric cars a range of 1,000 kilometres on a single charge. Innolith, a company that specialises in inorganic battery technology, is developing what it claims will be the world’s first 1,000 Wh/kg (watt-hour per kilogram) rechargeable battery, allowing electric cars to travel for up to 1,000 km before having to recharge. Not only does the high density battery have the potential to all but eliminate range anxiety, but it will also reduce the costs associated with battery production due to the fact it doesn’t require the use of what Innolith calls “exotic and expensive materials”. Another advantage is that, while traditional electric car batteries use a flammable organic electrolyte, the Innolith Energy Battery will utilise a non-flammable inorganic electrolyte, therefore reducing the risk of the vehicle catching fire. The battery is currently being developed at Innolith’s laboratory in Germany, with the development and commercialisation process expected to take between 3 and 5 years. Innolith will initially launch the battery to market via a pilot production scheme in Germany, after which licensing arrangements will be made with vehicle manufacturers and other battery companies. Innolith says the charging time required for a car fitted with its new batteries to reach a range of 400 kilometres for example will be no different from that of an electric car with a conventional battery, but the firm anticipates a full recharge will require the vehicle to be left plugged in overnight. The firm says it has patents pending for the key points of the technology and is maintaining commercial confidentiality on the details of the cell chemistry mechanism, intending to retain control of specialty chemical supplies under any future licensing arrangements. +++ 

+++ BMW, Daimler and Volkswagen (including Audi and Porsche) have been accused of COLLUDING to restrict competition on emission-reducing technology in a preliminary European Commission report. The Commission has issued a Statement of Objections saying that, in its view, the manufacturers breached EU antitrust rules. The firms allegedly coordinated their AdBlue dosing strategies, tank size and refill ranges between 2006 and 2014 in order to limit AdBlue consumption in their cars. While this will have meant owners did not have to refill their diesel cars’ AdBlue tanks as often, something likely to have improved the ownership experience, it also reduced the systems’ effectiveness when it came to cleaning up exhaust gases. The 3 companies have also been accused of delaying the introduction of Otto particulate filters (OPFs; which limit harmful exhaust emissions from petrol-engined cars) in their new direct injection petrol models between 2009 and 2014. In a statement, the Commission said: “The Commission’s preliminary view is that the car manufacturers’ behaviour aimed at restricting competition on innovation for these 2 emission cleaning systems and in doing so, denied consumers the opportunity to buy less polluting cars, despite the technology being available to the manufacturers”. It added: “The sending of a Statement of Objections does not prejudge the outcome of the investigation”. BMW Group issued a statement in response, saying: “The BMW Group attaches great importance to the findings confirmed by the European Commission in its press release of 18 September 2018 that the ongoing investigations concern only potential violations of competition law and not deliberate unlawful manipulation of the emission control system. There is no allegation of this kind against the BMW Group. The BMW Group is committed to responsible and lawful conduct as the basis for all its business activities. The company has established a comprehensive compliance management system to ensure compliance with applicable legislation, including the provisions of antitrust law”. A spokesperson for Daimler said: “We are aware that a statement of objections has been issued and are awaiting formal notification. Daimler has been cooperating extensively with the European Commission as leniency applicant already at an early stage and does not expect to receive a fine in this matter. We have no further comments to make, as this is an ongoing case”. In a statement, Volkswagen said: “The Commission acknowledges the fact that cooperation between manufacturers on technical issues is widespread in the global automotive industry. After having investigating numerous other technical topics, which were discussed in the Circles of Five, the Commission stated last year that it ‘does not have sufficient indications that these discussions constituted anti-competitive conduct that would merit further investigation’. The proceedings were therefore limited to conduct relating to emission control systems only”. +++ 

+++ U.S. government officials plan to meet with executives from automakers and lithium miners in early May as part of a first-of-its-kind effort to launch a national ELECTRIC VEHICLE supply chain strategy, according to 3 sources familiar with the matter. While Volkswagen, Tesla and other electric-focused automakers and battery manufacturers are expanding in the United States and investing billions in the new technology, they are reliant on mineral imports without a major push to develop more domestic mines and processing facilities. China already dominates the electric vehicle supply chain. It produces nearly two-thirds of the world’s lithium/ion batteries, compared to 5 % for the United States, and controls most of the world’s lithium processing facilities, according to data from Benchmark Minerals Intelligence, which tracks prices for lithium and other commodities and is organizing the Washington event. U.S. imports of lithium have nearly doubled since 2014 due in part to rising demand from Tesla, SK Innovation and others building battery plants in the country, according to the U.S. Geological Survey. “We need to find ways to more efficiently develop our nation’s domestic critical mineral supply because these resources are vital to both our national security and our economy”, North Dakota Senator John Hoeven, a member of the Senate’s Energy and Natural Resources Committee, said in a statement to Reuters when asked about the meeting. Hoeven and Senator Lisa Murkowski, chair of the Senate’s energy committee, have been invited to attend the meeting. Officials from the U.S. Department of State, Department of Energy, Department of the Interior and the U.S. Geological Survey plan to attend, according to 2 of the sources. As part of the effort, Murkowski is expected to introduce standalone legislation aimed at streamlining the permitting process for lithium and other mines, bolstering state and federal studies of domestic supplies of critical minerals and encouraging mineral recycling, among other topics, according to a source familiar with the matter. Some of those efforts were part of broader energy legislation in prior Congresses that failed, and Murkowski hopes that similar legislation will draw broader attention to the topic, according to the source. 5 companies, including Lithium Americas, are developing U.S. lithium projects that plan to use new technologies to extract the metal from clays, bromine and even oilfield waste, processes not common elsewhere and considered game-changing by some analysts. But not all of them have secured financing. If all 5 come online by 2022 as planned, the country would produce at least 77,900 tonnes of lithium carbonate equivalent each year, making the country one of the world’s largest lithium producers. Lithium development projects have historically faced numerous obstacles, so that production number is far from guaranteed. “Creating a domestic electric vehicle supply chain is the perfect blueprint to make America great again”, said Jesse Edmondson, chief executive officer of U.S. Critical Minerals, a start-up firm buying lithium mineral rights in the U.S. Southeast. Representatives from Tesla, Ford and General Motors plan to attend the Washington meeting and discuss with federal officials potential policy changes that could encourage development of a domestic supply chain to mine, process and supply lithium, nickel, cobalt and graphite for battery manufacturers and automakers, according to the sources. Tesla and GM did not respond to requests for comment. A Ford spokesperson said that the company regularly engages with stakeholders on various supply chain topics. Albemarle and Livent, 2 U.S.-based companies that mine lithium in South America, also plan to attend, as do executives from the handful of lithium mines under development in the United States, according to the sources. “We are looking forward to participating in a forum with policy makers and industry participants who are focused on ensuring the U.S. remains a leader in the development of the electric vehicle industry”, said Paul Graves, CEO of Livent, which has said it is eyeing expansion opportunities. Albemarle, which operates the only existing lithium mine in the United States, declined to comment. The 1-day meeting will be divided into morning workshops focused on financing and permitting obstacles, with one-on-one afternoon meetings between regulators and industry executives, according to the sources. “We’re trying to make sure policymakers have an understanding of this complex situation”, said James Calaway, chairman of Ioneer, which is developing a lithium project in Nevada that also hold a large concentration of boron, used in a plethora of consumer goods. In Arkansas, Standard Lithium is developing a pilot project to extract lithium from the bromine waste of a Lanxess AG chemical facility. “We have an opportunity to take a huge step forward in lithium production, and we want to support that”, Asa Hutchinson, the governor of Arkansas, told. Hutchinson and some other U.S. officials want U.S. lithium projects to stand alone without financial support from the government, a potential impediment as financiers often look for even tacit government support before investing in new, unproven technologies. “There’s a real opportunity in the electric vehicle supply chain if the United States wakes up”, said Jonathan Evans, president of Lithium Americas, which is developing a lithium project in Nevada expected to open by 2022. +++ 

+++ FORD will unveil a new variant of the Mustang during the 2019 New York auto show that could pick up where the SVO model from the middle of 1980s left off. Ford has plans to expand the Mustang line-up with an entry-level, performance-oriented trim level. The yet-unnamed variant will arrive as a hotter evolution of the EcoBoost-powered Mustang. Its turbocharged, 2.3-liter 4-cylinder engine will be tuned to make more than 310 horsepower, and it will receive suspension tweaks to help drivers make the most of the extra horses, and of the EcoBoost’s relatively low weight. On paper, the new Mustang variant sounds like a follow-up to the SVO, which was the most engaging member of the Mustang line-up during the 1980s. It’s too early to tell whether Ford will resurrect the nameplate, or call the car something else. Ford confirmed it’s almost ready to unveil a new version of the Mustang, but it’s keeping details under wraps. I’ll learn more about it in the coming weeks, and I’ll see it in the metal for the first time when the New York show opens its doors to the press on April 17. Sales will begin in time for the 2020 model year. +++

+++ In GERMANY , registrations fell 0.5 % to 345,523 in March, according to data from the KBA Motor Transport Authority. The drop in demand was likely due to several thousand fewer cars being sold due to carnival celebrations at the beginning of the month. Sales of diesel cars fell 2.7 % last month, giving diesel a 32.4 % market share. Gasoline car sales dropped by 6.4 % for a 60.2 % share. Tesla, Volvo and Audi were among brands that made volume gains, while Honda, Nissan, Honda and Jaguar were the biggest losers.Tesla registrations rose 453 %, while Volvo sales increased 39 % and Audi was up 16 %. Other winners included Smart, up 13 %, Suzuki, up 12 % and Opel, up 6.4 %. Seat volume increased 8.4 %, while Skoda rose 4.1 %. Major Japanese brands had a bad month. Honda’s registrations plunged 40 %, Nissan’s volume fell 39 % and Toyota dropped 14 %. Among other poor performers were Jaguar, whose registrations fell 26 % and Land Rover whose volume dropped 18 %. Ford sales declined by 4.7 %, while Fiat was down 1.3 %. Registrations at market leader Volkswagen brand fell 2.9 %. Among premium brands, Mercedes-Benz declined 5.2 %, while BMW was down 3.1 %. Through March, German sales fell 0.2 % to 880,092. +++ 

+++ A Tokyo court approved a request by prosecutors to detain Carlos GHOSN for 10 days for further questioning, rejecting an appeal by the ousted Nissan boss’ lawyer to free him as he fights charges against financial misconduct. The Tokyo District Court said it had approved the request by prosecutors to detain Ghosn until April 14. The decision was widely expected after prosecutors arrested Ghosn for the 4th time at his Tokyo apartment. Prosecutors re-arrested Ghosn on suspicion the former Nissan and Renault boss had tried to enrich himself to the tune of $5 million at Nissan’s expense. In a statement, Ghosn said he was innocent of the “groundless charges and accusations” against him. The once-feted executive, who has said he is the victim of a boardroom coup, also called the latest arrest an attempt to silence him. The Ghosn scandal has rocked the global auto industry and strained ties between Nissan and its global alliance partner Renault. It has also shone a harsh light on Japan’s judicial system. The arrest came 30 days after Ghosn was released on $9 million bail from a Tokyo detention center. Legal experts have characterized the move as rare for someone already released on bail. Under Japanese law, prosecutors can seek an extension of another 10 days of detention before they must either bring formal charges against suspects or let them go. +++ 

+++ KARMA AUTOMOTIVE has teamed up with the Italian design house Pininfarina, with plans to unleash 3 new models at the 2019 Shanghai Auto Show. So far, this low-slung coupe is the only car the partnership has teased, with further plans for a next-generation Revero saloon and a concept called the Karma Vision in the pipeline. Karma’s collaboration with Pininfarina was quietly announced in January this year. The pair says it is aiming to push the Karma brand into the EV marketplace occupied by the likes of Tesla and Nio. The brand’s expansion will start in the United States before expanding into Europe and Asia. Little information has been released about the design of Karma’s latest concept. All I know is that its styling was penned by Pininfarina and, given Karma’s reputation, it’s more than likely to feature an electrified drivetrain. The three new models will form Karma’s ‘Shanghai Big Three’ product announcement. As part of its business plan, the firm also aims to acquire and develop a range of electrification, connectivity and artificial intelligence technology for its upcoming cars to ultimately grow its position in the global EV marketplace. Karma’s CEO, Lance Zhou, said: “our business and product plan is driven by collaborating with like-minded and nimble partners, such as Pininfarina, whose design expertise will help us accelerate the product development, differentiation, and personalized customization that allows every Karma to be truly special”. This new concept follows the Karma Revero extended-range electric vehicle. Powered by 2 electric motors, it produces 408 hp and 1.330 Nm, can do 0–100 km/h in 5.6 seconds and has a top speed of 200 km/h. It has an all-electric range of 80 kilometres or when the batteries are being charged by the on-board petrol generator, a range of 480 kilometres. +++ 

+++ French carmaker PSA Group is not focused on negotiating a new partnership with Fiat Chrysler Automobiles (FCA), Chief Executive Officer Carlos Tavares said. Asked if an alliance with FCA was something PSA is actively exploring or in talks about, Tavares said at a press event in the southern Indian city of Chennai, “No, we are not targeting a specific company. We are working with all of our partners”. It was reported earlier this week that PSA and FCA were exploring a partnership to share investments to build cars in Europe. The president of the Peugeot family holding company FFP said last month he would support a new deal and had suggested FCA was among the options. “We have a lot of partnerships and of course it is very normal that we work with our partners to improve what we are doing continuously. But we are not targeting any specific car company for a very simple reason we don’t need it. If there is an opportunity, we will consider but we don’t have to target any specific company and specifically not the one you mentioned”, Tavares said. FCA is often cited as a possible merger candidate for PSA given its exposure to the U.S. market and its popular Jeep brand. PSA, known for its legacy Peugeot, Citroen and DS brands is eyeing a global play as it pursues a 50 % group sales increase outside its home-turf Europe by 2021. To expand internationally, PSA is relying on an Opel re-launch in Russia, a Peugeot comeback in the U.S. market and a Citroen entry in India. PSA said the C5 Aircross would go on sale in India before the end of 2020, adding it was aiming to capture 2 % of market share in the country of 1.3 billion by 2023-24. The company is also planning to make India an export hub, starting with automobile parts. The SUV is the first product from the Citroen brand aimed at the Indian market and the company said it would launch one new car in the market every year from 2021. PSA is re-entering the India market. In the late 1990s, its local joint venture to sell Peugeot cars fell apart. Almost all of PSA’s revenue comes from Europe, which accounts for 80 % of its global vehicle sales after its purchase of General Motors’ Opel-Vauxhall division in 2017. In China, which contributes about 4 % of Paris-based PSA’s sales, the carmaker has been struggling to reverse a sustained sales collapse where group deliveries fell 32 % in 2018. “We are not giving up in China. There is no way we will ever give up in China. It will take time but we will not give up”, said Tavares. India is the world’s fastest-growing major car market but in the last few months weak consumer sentiment has led to lower sales, with rising insurance costs also hitting sales. The country’s top 3 automakers, Maruti Suzuki, Hyundai and Mahindra, together account for about 74 % of domestic sales in India. +++ 

+++ RENAULT blocked former chief executive Carlos Ghosn’s pension, as the French carmaker said an internal probe had identified “questionable and concealed practices” by the fallen auto industry hero. Renault, which had initially questioned alliance partner Nissan’s accusations against Ghosn following his November arrest, also confirmed it had alerted prosecutors over suspect payments to a Middle Eastern distributor. Ghosn is awaiting trial in Japan on charges that he failed to report $82 million in Nissan pay he had arranged to receive after retirement. He has also been indicted for temporarily transferring personal investment losses to Nissan and steering $14.7 million in company funds to a Saudi business associate. The former Renault-Nissan boss has denied any wrongdoing. Renault contacted French prosecutors late last week after uncovering millions of euros in payments described as dealer incentives to Omani distributor Suhail Bahwan Automobile (SBA), sources close to the company earlier told. The file sent to prosecutors shows that much of the cash was then channeled to a Lebanese company controlled by Ghosn associates, the sources said. Nissan previously found that its own regional subsidiary made questionable payments of more than $30 million to SBA. Renault said it had “informed the French judicial authorities of potential issues concerning payments made to one of Renault’s distributors in the Middle East”. An internal investigation found “questionable and concealed practices and violations of the group’s ethical principles”, the company added. Its joint audit with 43.4 % owned partner Nissan is due to report final conclusions by the end of April. Ghosn, credited with having revived both Renault and Nissan, was sacked by the Japanese firm within days of his arrest and was forced out as Renault chairman and CEO in January. In his resignation letter, he also notified the board that he was entitled to his pension, a person close to the company said. “But his lawyers got it wrong”, the source said after a board meeting. Ghosn’s resignation means he “is not entitled to any pension” from his defined-benefit plan worth €765,000 annually for life, Renault announced. The company also recommended that shareholders block €224,000 in Ghosn’s variable pay for 2018, and approved governance changes reducing the size of the board to 18 members from 20 after he formally exits as a director in June. Renault previously axed Ghosn’s €30 million in deferred and severance pay in the wake of his indictment. The 65-year-old promised to “tell the truth” at a news conference next week, taking to Twitter to announce his first briefing since being released on bail. Former Daimler executive Annette Winkler will join the board to replace Cherie Blair, the wife of British former prime minister Tony Blair, Renault said. She and director Philippe Lagayette are both stepping down in June. +++ 

+++ RUSSIA car sales rose 1.8 % last month to 160,180, helped by the introduction of government subsidies for lower-priced vehicles, the Association of European Businesses (AEB) lobby group said. The result was a rebound from the 3.6 % fall seen in February as the subsidies helped offset a January tax rise that had subdued demand. “Consumer demand is still lagging behind the momentum we saw 1 year ago. Government subsidies for lower-priced vehicles effective from March obviously also helped to improve the total market picture this month”, AEB Chairman Jörg Schreiber said. Market leader Lada increased sales 10 % during the month, while its closest competitor, Kia, boosted its volume 2 %. Third-place Hyundai dropped 2 %, while No. 4 Renault was down 7 %. Toyota, in fifth place, rose 3 %. Other winners included Nissan (+27 %), BMW (+20 %), Skoda (+7 %), and Mercedes-Benz (+3 %). Among the losers, Ford fell 32 %, Mitsubishi dropped 6 % and VW slipped 1 %. In the first quarter, Russia sales fell 0.3 percent to 391,650. +++ 

+++ The forthcoming Cupra Leon will be offered as a plug-in hybrid, and will be just one of 6 electrified SEAT cars to arrive in dealers by the start of 2021. The Spanish manufacturer’s performance sub-brand had been expected to offer the fastest Leon available under its own badge after the new generation of the car goes on sale next summer. However, Seat confirmed at its annual press conference that while a plug-in hybrid version of the regular Leon will be introduced, in both hatchback and ST body styles, the Cupra editions of these models will also be electrified. “In 2020, the new generation of Leon will come to market”, said Seat boss Luca de Meo. “It will feature a plug-in hybrid powertrain that will produce up to 245 hp and less than 50 g/km of CO2 emissions. Just before the end of 2020 the Cupra Leon and Cupra Leon ST, both with plug-in hybrid versions, will arrive”. The power output given by De Meo is, in fact, the specification of the Cupra Leon, not the conventional Seat Leon PHEV. The figure of 245 hp matches the powertrain in the Cupra Formentor coupe-SUV concept displayed at last month’s Geneva Motor Show. That model was also named as one of the forthcoming electrified Seats, although it will be offered with conventional combustion-engined power, too. Cupra boss Wayne Griffiths confirmed that the Leon will get the same powerplant as the Formentor, with 245 hp, but he suggested that Cupra may want to push power outputs higher than this figure. “We have to look as well at performance hybrids”, Griffiths added. “At the moment, the combined performance is good but we could do even more. There’s a lot of stuff we could look at: electric rear-axle drive, for example”. Griffiths explained that discussions are “ongoing” about an all-electric Cupra model based on the VW Group’s MEB architecture. “It would have to fit with Cupra values”, he said, “but in terms of acceleration at least, all-electric vehicles are already there”. +++ 

+++ Strong demand abroad for the company’s Model 3 couldn’t save TESLA from weaker than expected first quarter results. Tesla delivered just 63,000 vehicles during the first 3 months of the year, representing a nearly 30 % decline from the 91,000 vehicles it sold in the previous quarter. Moreover, deliveries of the Model 3, the company’s newest model, missed analysts’ expectation with 50,900 units sold during Q1. “It’s a disappointment. There’s no way around that”, Gene Munster, a managing partner of venture capital firm Loup Ventures, told. “The big question is, what is demand?”. The first 3 months of 2019 marks the first ever quarterly decline of Model 3 sales. Sales of the Model S and Model X also trended in the wrong direction during the period, with sales falling by 15,500 units to 12,100. However, Tesla’s first quarter results might not be as gloomy as they first appear. Tesla recently began selling the Model 3 in a number of global markets, and vehicles in transit aren’t counted toward the company’s quarterly deliveries. Slacking demand for the Model S and Model X could be explained by the expiration of a $7,500 federal tax credit. Tesla’s somewhat rocky start to the year isn’t out of line with the overall market. Industry-wide sales slipped 3.2 % in March as automakers continue to grapple with the shift from cars to pickups. +++  

+++ In the UNITED KINGDOM , new car registrations declined by 3.4 % year-on-year in March, with political uncertainty and the continuing slump in demand for diesel offsetting the usual sales boost due to the introduction of new plates. March is traditionally a key month for car sales because of the plate change. This year a total of 458,054 cars were registered, compared to 474,069 last year. The bulk of the decline again came from the slump in demand for diesel-engined cars, with registrations of such vehicles falling 21.4 % to 120,677. By contrast, registrations of petrol cars rose by 5.1 % to 312,075, with demand for Alternatively Fuelled Vehicles (AFVs) increasing by 7.6 % to 25,302. Notably, sales of B segment superminis rose by 4.3 %, with the category accounting for 33.7 % of all registrations in the UK. The Ford Fiesta remains the best-selling car in the UK, with 14,676 registrations in March, and 23,474 so far in 2019. The Vauxhall Corsa was second on the best-seller list, with the Volkswagen Golf third. +++

+++ VOLKSWAGEN ’s R performance division has reignited a development programme on a “close to 400 hp” Golf R Plus model as a range-topping rival to the Mercedes-AMG A45 and Audi RS3. The 4-wheeldrive machine would sit above the planned Golf R version in the line-up of the eighth-generation model. Under its skin, it would rely on hardware and technology from the seventh-generation Golf R400 concept shown in 2014 and the Golf TCR race car developed by Volkswagen Motorsport. The secret model is being developed alongside the standard version of the new Golf R at VW’s R&D headquarters in Braunschweig. VW insiders have claimed it will be the “most extreme and powerful Golf yet”. As an indicator of its potential performance, they pointed to the supercar-like acceleration and top speed of the R400, which was claimed to have a 0-100 km/h time of just 3.9 seconds and a 280 km/h top speed. A source added: “We’re looking at introducing a new ‘halo’ performance model that would offer a level of performance beyond that of the next Golf R”. The new Golf R Plus has not yet been approved for production, but I have been told that it has the support of VW boss Herbert Diess. If it gets the go-ahead, it is likely to join the VW line-up after the new Golf R goes on sale in 2020, at a price similar to that of the Audi RS3. Highlighting the advanced state of the Golf R Plus development programme, VW officials confirmed that a styling proposal for the variant has already been completed. It features a considerably more aggressive appearance than the standard version of the next Golf R, with broader front wings that, insiders say, have been adopted in combination with a widened front track. The next-generation Golf will be produced as a 5-door only, so both the Golf R and R Plus will be offered in that bodystyle alone. At the heart of the secret new range-topping Golf is a highly tuned version of the Volkswagen Group’s EA888 petrol engine. In the new Golf R, the Audi-developed turbocharged 2.0-litre unit is planned to deliver around 320 hp. But with a range of power-enhancing measures, the engine could ultimately provide the Golf R Plus with between 380 hp and 400 hp. Originally a project of Volkswagen’s former head of petrol engine development, Friedrich Eichler, the powered-up 4-cylinder was first showcased in the R400 concept with 400 hp and 450 Nm at the 2014 Beijing motor show. That model was closely considered for production. An even more powerful version of the EA888 with added turbocharger boost pressure and other changes was featured in the Audi Quattro Sport concept, which made its debut at the Geneva motor show in 2014. In that car, it offered 420 hp. Both projects were placed on hold due to the Dieselgate emission scandal until VW’s head of development, Frank Welsch, decided to revisit the ideas behind the R400 in 2018. New developments brought to the engine of the Golf R Plus include a particulate filter. Like the next Golf GTI, though, it is thought to eschew mild-hybrid electric motor boosting. As with the standard version of the new Golf R, drive is set to be channelled through a standard-fit 7-speed dual-clutch gearbox and a 6th generation version of VW’s 4Motion 4-wheeldrive system. That set-up will now feature fully variable control that constantly alters the amount of drive being sent to the front and rear axles. The new 4-wheeldrive system is likely to operate in combination with VW’s EDS and XDS+ electronic differential locks and a multi-stage ESP stability control system incorporating a drift mode similar to that set to appear on the new Mercedes-AMG A 45. News of the new Golf R Plus comes as VW is preparing to extend the number of R models it offers, starting with the T-Roc R, which made its public debut at the recent Geneva show. +++

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