+++ ASTON MARTIN reported lower first-quarter earnings as the automaker boosted spending on new models and sales in Europe declined. Adjusted earnings before interest, tax, depreciation and amortization fell 35 % to 28.3 million pounds ($37 million), the automaker said. Analysts had expected a 31 million-pound profit, based on company-collated estimates. Revenue rose 6 % to 196 million pounds ($252.98 million). The company reported an adjusted operating loss of 2.2 million pounds, compared with a profit of 22 million pounds a year earlier. Costs at Aston Martin rose as the automaker pumped cash into the development of a new model range as it seeks to replicate Ferrari’s success in moving toward higher-volume carmaking. It also increased spending on marketing the latest products. A new factory in St Athan, Wales, began production trials on April 15. The plant is regarded as key to future growth as it will build both the DBX, the company’s first SUV, and a lineup of electric models. The company sold more than 1,000 cars in the 3 months and said it is on course to reach a target of 7,100 for the year. That will take it more than halfway toward a 2023 target of 14,000 sales. Vehicle sales fell 9 % in the UK, where delays to Brexit have stunted demand, and 4 % in mainland Europe in the first 3 months. By contrast, sales in China surged 29 % and in the Americas by 20 %. The company’s performance “reflects the higher than usual dealer inventory levels at the start of the year, particularly in the UK and Europe given the late December deliveries due to fourth quarter supply chain disruption”, Aston Martin said. “We remain conscious of the challenging external environment in certain of our markets and we have taken this into account in our planning while ensuring we do not compromise on delivery”, CEO Andy Palmer said while affirming full-year prospects. Aston Martin’s stock has lost half its value compared with a 19-pound IPO price in October, hitting an all-time low this month. The decline has fostered concern that the stock was oversold and is a far cry from gains at Ferrari, which is more profitable with a stronger balance sheet and earnings multiples akin to luxury-goods companies. +++ 

+++ South Korea’s SK Innovation said that it plans to invest 579.9 billion won ($488.30 million) to build its second China factory for electric vehicle BATTERIES , in a bet that China will open up its market to Korean battery makers. The latecomer to the battery market is aggressively expanding its production capacity globally, starting to build new factories in Hungary, China and the United States since last year with a total investment of 5 trillion won. SK Innovation said its second China factory aims to meet rising orders for EV batteries globally, without elaborating on its Chinese partner, the site and capacity of the proposed plant. SK Innovation was in talks to set up separate battery-making joint ventures with Chinese partners and Volkswagen. Currently, vehicles equipped with South Korean batteries are not eligible for government subsidies in China, the biggest auto and EV market in the world. But Korean battery makers including LG Chem have in recent months announced investment plans to expand capacity in China, hoping that China’s plan to phase out subsidies by 2020 would create a level playing ground. SK Innovation broke ground in August on its first Chinese plant under a joint venture with Beijing Electronics Holding Co and BAIC Motor Corp, with investment set to reach 5 billion yuan ($744.30 million) by 2020. Automakers are under pressure to deliver EVs as China set quotas for sales of new energy vehicles (NEVs). China wants NEVs (which also include hybrids, plug-in hybrids and hydrogen fuel cell vehicles) to account for a fifth of auto sales by 2025 compared with 5 % now. SK Innovation’s customers include Daimler, Volkswagen and Hyundai. SK Innovation was sued in April by its bigger rival LG Chem in the United States for alleged theft of trade secrets. SK Innovation has denied the allegations. +++ 

+++ A leading operator of CHARGING STATIONS has sounded the alarm on a proposed technical standard that it says could hamper mass adoption of electric vehicles by making it harder to charge them at home or at work. ChargePoint, which plans to run 2.5 million charging stations by 2025, says the standard would perpetuate an old ‘gas station’ model that automakers are backing as they launch mass production of battery-powered cars. As well as being less convenient for users, that could give too much pricing power to utilities, limiting the flexibility of charge station owners, ChargePoint says. There are only a few million electric vehicles, or EVs, on the roads today, but with the International Energy Agency forecasting that figure could reach 130 million or more by 2030, there is a huge market opportunity up for grabs. With Swiss bank UBS estimating the cost of building charging networks at $360 billion over 8 years, there is a powerful incentive too for stakeholders to influence how they operate. There are also risks, however, that a botched system which makes EVs harder to use could stall public acceptance, ChargePoint’s Senior Vice President Product Bill Loewenthal told. “We’re at a really delicate time in the industry and getting this wrong is catastrophic”, Loewenthal said in an interview. ChargePoint, which operates but does not own its charging network, providing an Uber-like service, has a 70 % share of the market for commercial charging in the United States, by its own estimate. It has raised $530 million in 10 funding rounds from investors including Daimler, BMW and Siemens in Germany, as well as U.S. energy firms Chevron and America Electric Power. Yet it finds itself at odds with the German automakers on some aspects of how the industry should develop. Loewenthal was speaking ahead of the North American Conference of CharIN, an initiative backed by German automakers to support their preferred Combined Charging System (CCS) standard. In a clash reminiscent of the VHS versus Betamax videotape saga, CCS has a lead in Europe but is elsewhere up against Tesla’s Supercharge system and CHAdeMO, supported by Japanese carmakers Nissan and Mitsubishi. California-based ChargePoint, founded in 2007, has differences of opinion with the German automakers on two aspects of the proposed ISO 15118 technical standard, known in the industry as “Plug & Charge”, that will govern how cars talk to charging stations. ChargePoint, in a research report, said Plug & Charge would set flawed rules for authenticating secure communication, inserting a middleman into an exchange that can be perfectly well handled by existing Public Key Infrastructure providers. Further, Plug & Charge would give too much central power to utilities on pricing, to the detriment of charging station operators who want discretion, for example in managing the mix of power they generate on site and take from the grid. These can be office managers offering an in-kind benefit to staff who plug in vehicles at work, or stores and restaurants offering a free charge to patrons to attract their custom. More broadly, ChargePoint argues that most drivers will use slow chargers at home and work, enabling utilities to tap the battery reserves of cars on charge to balance supply and demand in their networks for much of the day and night. Only a minority, such as taxi drivers or people going on road trips, will want to pull in for a fast charge at public stations that run on direct current. “The reality is that people want to plug in where they work and live – and that aligns a lot with where the needs of the grid are”, said Loewenthal. High-speed chargers are “an industrial solution, not a consumer solution”, he added: “It’s needed, but it’s not what consumers will be using in their daily lives”. +++ 

+++ Global CO2 output would reduce by only 0.4 % if all vehicles in Europe were to convert to fully ELECTRIC overnight, a senior industry executive has claimed. There are almost 300 million vehicles on European roads, of which around 800,000 are fully electric; but that figure is rising rapidly each year. However, Roberto Vavassori, President at CLEPA, the European associate of automotive suppliers, said that the focus on developing fleets of electric vehicles may not have as much of an impact on reducing CO2 emissions as widely thought. “Europe is responsible for 10 % of worldwide CO2 emissions, while China, USA and India represent 66 %”, Vavassori stated. “So we know that 7 % of global CO2 emissions is the CO2 emissions of light vehicles if by chance we electrify all of Europe overnight we will save 0.7 % of CO2 emitted globally every year”. However, that true figure would be less because due to the use of fossil fuels outside of the automotive industry. Vavassori said: “Because we still need electricity generated from fossil fuels, this number will go down to 0.4 %. Are we aware of this context?” Transportation, the generation of electricity and industry are the 3 largest contributors to global CO2 emissions. +++ 

+++ The revival of the FORD Puma nameplate was announced earlier this year, but now it looks like the brand might be preparing a hot ST version of the new compact SUV. It will feature large alloy wheels and twin chrome exhaust pipes. The new Puma will be a compact B-segment crossover on the same platform as the Fiesta, designed to rival the likes of the Nissan Juke, Peugeot 2008 and Renault Captur. It’ll arrive to coincide with the launch of the Skoda Kamiq, too. The ST version of the new Puma will share much of its mechanicals with one of my favourite hot hatchbacks: the Fiesta ST. That means under the bonnet I expect a 1.5-litre turbocharged 3 cylinder petrol engine with 200 hp. In the Fiesta ST, it covers the 0-100 km/h sprint in 6.5 seconds, so expect a time of just under 7 seconds for the larger Puma. Like the Fiesta ST, the Puma ST should send its drive to the front wheels via a 6-speed manual gearbox. A raft of chassis upgrades should also help the Puma feel almost as sharp in the bends as its Fiesta stablemate. The car will run at a fairly low ride height by SUV standards, though the set-up is likely to be a litltle more forgiving than the Fiesta ST’s. The Puma ST will occupy what is currently a fairly unique place in the market. The likes of the Volkswagen T-Roc R and Audi SQ2 are larger, more powerful and offer 4-wheeldrive, while Nissan’s Nismo Juke RS is long out of production. The regular Puma is due to be released in 2020, so if Ford goes ahead with an ST badged variant, we can expect it to follow later next year. +++ 

+++ HONDA has confirmed that it will close its manufacturering plant in Swindon in 2021, saying that it could not identify any “viable alternatives” following a period of consultation. The Japanese firm announced plans to close the factory, which currently builds the Civic, in February, putting 3.500 jobs at risk. At the time, it said the move was due to “unpredecented changes in the global automotive industry”. In its latest statement, Honda said that the need to accelerate its electification plans meant that “resources, capabilities and production systems for electrified vehicles will be focused in regions with a high volume of customer demand”. Honda says it has undertaken a “meaningful and robust” consultation period since then, which included contributions from the UK government, unions and other outside groups. But it said that phase has now concluded that the closure would go ahead in 2021, when the current Civic reaches the end of its lifecycle. The firm will now begin the second phase of the consultation, which includes finalising redundancy packages and “identifying the impact on individual roles up until production ceases in 2021”. Honda said it will also consult with the Swindon Task Force set up by Secretary of State Greg Clark to “mitigate the impact of this decision on the wider community”. The closure would result in 3500 job losses. The Wiltshire factory, which builds only the Civic, currently produces 150,000 cars annually; far from its capacity of 250,000 units. The closure is a huge blow for the government’s hopes of the UK remaining an established car manufacturing hub post-Brexit. While Brexit hasn’t been cited as a reason for Honda’s plans, it is the latest factor in a perfect storm for the industry. +++ 

+++ LOTUS could build GTs, sports saloons, crossovers or SUVs in future, according to new boss Phil Popham, but only after it has re-established its credentials as a sports car firm. Earlier this year, Lotus revealed plans for an electric hypercar, codenamed Type 130, as well as indicating it was preparing to launch a new sports car ahead of renewing the Elise, Exige and Evora. The renewal of the sports car line is part of a 5-year programme kick-started by Popham’s arrival following the company’s acquisition by Chinese giant Geely. However, Popham has also indicated the brand will expand outside its traditional models in time. “There’s a lot of talk about an SUV, but we haven’t confirmed that”, said Popham. “We are rebuilding the business around sports cars and that’s the priority but we do believe that once that is done, this brand has the DNA and heritage to go further. That could mean GTs, crossovers, SUVs, sporting saloons, or just about anything else. The plans are open and we’ll look at every potential area in a very detailed way, considering all areas”. Lotus has long been assessing its SUV plans, with the firm’s previous management started a project that would use elements of the SPA structure used by Geely and Volvo. Popham also outlined his view that electrification, connectivity and autonomy can be an opportunity for Lotus, despite its focus on driving dynamics. “In terms of autonomy, I see our cars having the capability, and our owners using that in the city before hitting the ‘Lotus’ button on a country road or track and taking control – perhaps assisted by that same technology to reach the absolute limits”, he said. “Electrification brings challenges and opportunities. In time, I don’t think people will notice the loss of the engine noise. For us, it’s about the car’s dynamics. Electric cars offer a low centre of gravity, because of where the batteries are placed, and the aerodynamics aren’t constrained by the mechanical parts”. Describing Lotus as a “70-year-old start-up”, Popham highlighted that despite its current investment (estimated to be in excess of €1.7 billion) and recruitment drive, it remained agile compared with rivals. He declined to declare projects for sales to justify the investment, but conceded Geely had targeted a long-term strategy. “Today we are a 1.700 sales a year firm, and it’s clear we can’t be funded for the future by those sales”, he said. “We have to take a leap. We have to grow exponentially. Part of that will come from China, and Geely’s ownership can help with that, but we are looking to America and Europe with just as much focus”. 

+++ Like a practitioner of the Japanese art of Kabuki, Emmanuel MACRON ‘s administration is going through some elaborate dance steps to try to shape the future of the Renault-Nissan carmaking alliance. The French president wants to protect the jobs of his citizens, as well as taxpayer money and France’s credibility as an industrial investor. It’s been an incredibly clumsy performance. France controls 30 % of the voting rights in Renault and would like to tempt Nissan into a full-blown merger to heal the rift exposed by the downfall of Carlos Ghosn, the former Renault boss and architect of the 2 companies’ alliance. Nissan is having none of it. The Japanese company rebuffed the idea in April and remains opposed. Tokyo’s view seems to be that the alliance already has the benefits of scale and cost savings, and a merger would not add much. Nissan’s argument may be unconvincing in terms of its financial logic (a full-blown merger would obviously allow for fewer overlaps), but it should surprise nobody. Paris’s dream of combining Renault and Nissan helped trigger the Ghosn crisis in the first place, with the former alliance boss pushing for a deal before his arrest in November. Given the already lopsided distribution of power (Renault owns 43 % of Nissan, but the latter owns just 15 % of its French partner), Japanese hackles were well and truly raised by Ghosn’s perceived power grab. Nissan would rather see Renault pare down its stake than enter into a potentially fraught merger agreement. So, it’s surprising that Paris would keep trying to sell such an unpopular idea to Tokyo. Ghosn’s replacement as Renault Chairman, Jean-Dominique Senard, is the son of a diplomat and has experience negotiating with difficult partners like trade unions from his time running the tire-maker Michelin. He must know he’s pushing at a closed door. Likewise, Macron and his finance minister Bruno Le Maire have had plenty of recent experience of what goes wrong when the French state meddles too much in the affairs of multinational corporate partnerships. France’s awkward handling of its airline alliance with the Dutch, Air France-KLM, has prompted the Netherlands to build its own government stake as a form of defense. Maybe there’s a misguided notion from Macron (a former Rothschild banker) that talking up a merger might offer some kind of theoretical support to Renault’s flagging share price, which has fallen about 38 % over the past year, versus a European peer group down 23 %. Bloomberg Intelligence analyst Michael Dean estimates that Renault’s core business, excluding its stake in Nissan and its net cash, is valued by the market at less than zero. Senard and Macron might also be betting that Nissan’s own financial problems have earned them the right to apply more negotiating pressure. In February, the Japanese automaker reported a 45 % drop in 9 month profit, citing strategic problems in the U.S. and China. These are not comfortable times for Nissan chief executive Hiroto Saikawa, whom Ghosn has signaled was close to being fired before his arrest. Still, in such a politically delicate drama, this all feels like too much, too soon. The most charitable interpretation of France’s continued pressure is that it realizes a full merger is out of the question, but that it might get a more advantageous reworking of the shareholder split if it keeps asking for something bigger. Regardless, Macron and Senard would do better to defuse tensions in an alliance that is so important to France, rather than exacerbate them. If that means reducing Paris’s influence by selling down its own Renault stake, so much the better. +++

+++ MASERATI will be the first of Fiat Chrysler Automobiles’ (FCA) brands to use self-driving technology being developed with BMW, FCA chairman John Elkann said in a speech in Turin, Italy. The technology will offer assisted-driving features on highways, Elkann told an industry group, without specifying a date for deployment in Maserati vehicles. Fiat Chrysler joined the self-driving technology consortium led by BMW in 2017. It also has autonomous vehicle development partnerships with Google affiliate Waymo and auto supplier Aptiv. Luxury sports-car brand Maserati, which saw its sales plunge 32 % in the first 3 months, has been struggling with a lack of new product and a sharp drop in demand from China. +++ 

+++ MCLAREN is due to launch its first hybrid powertrain in a non-Ultimate Series model next year. Earlier this year, McLaren boss Mike Flewitt confirmed that the first of a mooted range of hybrids will be the replacement for the Sports Series line-up, including the 540C, 570S, 570GT and 600LT. The first car of that model renewal will be launched next year. The exact specifications of what’s under the skin of these prototypes remains closely under wraps. Rumours strongly suggest that the Woking car maker will be switching to V6 power for the new hybrid system, saving weight and increasing efficiency, with electric power more than making up for the loss in cylinder capacity. The Sports Series replacement is also expected to come with a charging port, making it a plug-in hybrid rather than the recuperative hybrid system found in the P1. It will also put both petrol and electric power through the rear wheels only. While it won’t be possible to fully cancel out the weight penalty of a hybrid system, Flewitt hopes to minimise it. “I’ve always said my ambition was to launch the hybrid at the same weight as the outgoing car”, he said. “We’re not going to hit that, but we’re going to be within 30 to 40 kg. When you think the P1 hybrid system was 140 kg, we’ve done a huge amount to manage the weight. I’ve driven a prototype of it and the car is very compelling. We wouldn’t be launching it if it wasn’t going to be”. +++

+++ NISSAN said it had hit “rock bottom” with a 45 % drop in annual operating profit. The automaker’s troubles in the United States, including a failure to deliver on a slew of promises to dealers, are a major reason why. Nissan’s U.S. operations, once a big contributor to its international sales and profit, are now emblematic of its global challenges. Under ousted chairman Carlos Ghosn, Nissan’s U.S. operations gunned for ambitious sales goals by pitting dealers against each other in a battle for sales bonuses, and cranking up sales to fleets, dealers said. Chief executive officer Hiroto Saikawa said U.S. profit margins had hit a low level of between 1 % and 2 %. He acknowledged Nissan had failed to honor its promises and aimed to bring its fleet sales down to 15 % to 17 % of total sales by around 2022, from a high of around 40 % in the first quarter. Bulk sales to rental-car fleets undermine resale values and hurt retail consumers at trade-in time, dealers said. “It’s going to take more time than we thought to recover from this situation”, Saikawa said. Nissan dealers complain the Japanese automaker has provided few specifics of a turnaround plan, and has not delivered on its past promises. “We’ve heard a lot of talk, but we haven’t seen any action”, said U.S. Marine, managing partner with Sutherlin Nissan in Orlando, Florida. Marine said dealers were skeptical because so-called stair step bonus programs remain in place that reward dealers with cash only if they hit monthly sales targets. The programs can force dealers to slash profit margins to hit the targets, or risk seeing rival Nissan franchises get bonus money instead, dealers said. Profitability at his Nissan dealership has fallen by 50 % in the last 3 years, Marine said. “It’s depressing and deflating for a dealer when we get our new objectives for the quarter and they’re so high that some dealers are saying, ‘Screw it … we’re going to focus on selling used cars’ ”, Marine said. Jose Valls, Nissan’s recently appointed head of North America, told the automaker will refresh most of its lineup over the next 3 years. He is reaching out to dealers to persuade them that this time, Nissan really plans to change. “I know dealers are skeptical, but I’m trying to be very pragmatic and I need them as they need me”, Valls said. “We’re in the same boat”. Nissan still has high consumer discounts and fleet sales. Pulling back will be hard because overall demand for new vehicles in the United States is falling, and Nissan is weak in some of the remaining strong segments, such as large pickups. After hitting a peak of 8.9 % in 2016, Nissan’s U.S. market share slid to 7.8 % last year, its lowest since 2010. The company’s sales sank 11.6 % in the first quarter, compared with an industry-wide drop of 3.2 %. To one degree or another, major automakers rely on discounts in the U.S. market to sell vehicles. Automakers like Toyota and Honda use discounts sparingly to prop up resale values. At the high end, Nissan and others like Ford “still rely heavily on manipulating the deal” with discounts, said Brad Korner, a general manager for automotive rates and incentives. “We’ve come to a point where customers have been buying our product for the discounts offered on them, not for the strength of the product itself”, Nissan CEO Saikawa said. Unplugging from fleet sales and deep discounts threatens Nissan’s U.S. manufacturing operations. Nissan operates North America’s largest auto plant in Smyrna, Tennessee, which has capacity of around 640,000 vehicles a year, plus a large plant in Canton, Mississippi. Nissan laid off nearly 400 workers in Canton earlier this year. Nissan’s Valls said the automaker does not plan further job cuts, but added “anything is possible, we have to be prepared”. Chris Reed, Nissan’s North American head of research and development, said his top goal is to ensure the smooth launch of seven revamped or new models over the next 2 years. According to AutoForecast Solutions, they include new versions of popular models like the X-Trail and Pathfinder SUVs and the Frontier pickup. Pete DeLongchamps, senior vice president at auto retail chain Group 1 Automotive Inc, which owns 9 Nissan dealerships, said the automaker is launching the right products, but discounts and high inventories remain a problem. “Nissan needs to execute on its plan”, DeLongchamps said. “We will be watching them very closely to see that they do”. +++ 

+++ RENAULT is quietly pushing for a change of Nissan leadership as a prelude to merger talks, sources at both companies said, after the Japanese carmaker warned of a further earnings slide in the wake of the Carlos Ghosn scandal. Jean-Dominique Senard, who replaced Ghosn as Renault chairman in January, sees Nissan boss Hiroto Saikawa as an obstacle to progress, several people told. Pressure for a tie-up, which Saikawa has refused to discuss, will only intensify after Nissan revealed that its operating profit plunged 45 % in the last fiscal year and will likely drop another 28 % to “rock bottom” in the current one. “Renault will continue to push for talks citing performance as the impetus”, an executive close to Saikawa said after the results presentation. “They’ve already started again today”. These issues may come to a head at a preliminary meeting of Nissan directors to prepare for a full session on May 20, 3 sources said. Renault spokesman Frederic Texier and his Nissan counterpart Nick Maxfield both declined to comment. Ghosn’s November arrest in Japan and immediate ouster by Nissan strained the partnership, as Renault resisted a full investigation of alliance finances and kept its absent leader in office as chairman and CEO for 2 more months. Ghosn, who denies any wrongdoing, is awaiting trial in Tokyo on charges of financial misconduct and allegedly enriching himself at Nissan’s expense. After Ghosn’s eventual Renault exit, Senard succeeded in easing tensions with Nissan, securing a seat on its board and instituting a new alliance oversight committee under his chairmanship. But tensions resurfaced last month after a Renault-backed tie-up plan was leaked to the Japanese press. The proposal, confirmed by Renault sources, would place both carmakers under a new Paris- and Tokyo-listed holding company and effectively liquidate their cross-shareholdings, which are chronically undervalued by the market. Renault owns 43.4 % of Nissan, whose reciprocal 15 % Renault holding carries no votes. But Renault’s control of Nissan is curtailed by a 2015 shareholder pact struck in response to French government moves to increase the voting rights on its own 15 % Renault stake. Driven by a U.S. sales collapse, Nissan’s sharp profit decline and resulting dividend cut will wipe €130 million off Renault’s 2019 earnings, Citi predicts. Saikawa blamed the earnings wipeout on “the negative legacy of our old leader” and publicly restated his long-held aversion to a tie-up of the kind proposed by Senard. “I’m very aware that his view on this matter differs from mine”, Saikawa said. The timing of his succession as Nissan CEO was “a matter I need to decide”, he added. Whether Saikawa gets to make that call may depend on his own board, whose upcoming meeting will be a first test of his support following the dire financial disclosures. Renault has backed off demands for immediate deal discussions but has no intention of dropping the subject definitively, people on both sides of the alliance say. The French carmaker now privately argues that moving things forward may require “turning the page on the Saikawa era”, sources close to the Renault leadership said. Renault also wants to seat its CEO Thierry Bollore on the next Nissan board – a move seen at Nissan headquarters as provocative in light of his former role as Ghosn’s lieutenant and more recent resistance to an alliance audit. “Pushing him hard is bound to cause difficulties”, the senior Nissan executive said. Some investors have been waiting years for a Renault-Nissan tie-up or break-up; either of which could unlock the value of the cross-shareholdings. In a February note, brokerage Evercore ISI estimated the undervaluation of Renault’s Nissan stake at 40 %, arguing for a partial sale of the holdings. While Nissan decries the deal proposal as a distraction from necessary restructuring, Renault portrays it as an essential step toward an alliance recovery, delivering faster decision-making as well as an immediate stock-market boost. “We’re currently in a rather weakened version of an alliance”, a source close to Senard told. “The only people who can take pleasure in this situation are our competitors. A deeper evolution is necessary”. While exasperated with Nissan’s refusal even to discuss a merger, the Renault chairman is confident the issue cannot be avoided for long, the same person said. “Creating value should be the main preoccupation of any self-respecting board, if only as a matter of fiduciary duty”, he added. “No company can refuse to consider its options”. But the French carmaker’s impatience could also backfire again, by helping Saikawa to shore up board support, according to an executive close to Nissan’s senior leadership. “If Renault weren’t pushing this quite so hard, ironically people would be looking at him a lot more critically”, he said. +++ 

+++ An estate variant of the VOLKSWAGEN battery electric ID family is one of the models under consideration for the second wave of launches planned from 2022/23. So far VW has shown hatchback and crossover concept versions of its all-new MEB platform based models, which will make up the first wave of its BEV family. VW is concentrating initially on crossovers because they are more popular globally in all three main markets of China, Europe and the US, whereas the estate bodystyle is only popular in Europe. “We must concentrate on the main market sectors for the first wave of launches, but let’s put it this way: I like stationwagons and I will remember that”, VW’s boss of e-mobility Thomas Ulbrech told. VW is ramping up the ID family, starting with the Golf-sized ID.3 hatchback, for launch later this year and multiple bodystyles will roll out from Group brands Seat and Skoda in spring next year up to 2022/23 in the first wave. Some of these variants have been previewed with concept cars like the Seat el-Born and Skoda Vision iV, but the main bodystyles are hatchbacks or higher-riding crossovers. A second wave of around 15 new models models to boost production up to 15 million in total, solely on the MEB platform, by 2028 will kick-off in 2022/2023. In an effort to make BEVs more affordable to a wider audience Volkswagen has also started talking with the German government about subsidies to make an MEB-based Up city car replacement affordable. “The question for governments is how to organise these subsidies. It is one of the biggest challenges in e-mobility so people who own these smaller cars can benefit”, he said. Seat is leading development of the city car platform version of the MEB for its Mii hatchback. Ulbrich suggested a date of 2023/2024 for the all-electric Up to launch, but he cautioned that the high-cost cost of componentry is likely to push the list price to around €18-20k. That’s about €6k more than the small hatches cost today. “This is a problem all car-makers are going to have to make small cars affordable. The cost of the battery is much higher than an combustion car today”, added Ulbrich. He says the battery electric powertrain of a city car contributes 30 % to the whole vehicle cost, about twice the powertrain cost of a combustion-engined small hatch. Volkswagen says it has received pre-orders for more than half of the launch edition versions of its ID.3 electric hatchback. Customers in 29 European countries have been able to pay a deposit to pre-book one of the 30,000 examples of the ID.3 First models, which will be priced at under €40,000 in Germany. Deliveries are due to begin in April 2020. Volkswagen says that more than 15,000 pre-orders have been received since last week, with the greatest demand in Germany, Norway, the Netherlands, the UK and Sweden. Each country has received an allocation of ID.3 models. While Volkswagen’s IT systems initially struggled to keep up with heavy traffic from users, the firm says its systems are now stable. +++

+++ VOLVO said it had signed long-term battery supply deals with Asian firms LG Chem and Contemporary Amperex Technology Ltd (CATL), as it pushes its EV target of 50 % of sales by 2025. The agreements follow a series of pacts between Asia-based battery companies and global carmakers, who are planning a $300 billion surge in spending on electric vehicle (EV) technology over the decade. Long-term battery supply arrangements are much-valued by carmakers and investors, as they help to clear supply bottlenecks at a time of soaring demand and hold out the promise of cheaper batteries over time. Volvo is investing about 5 % of its annual revenue (a little more than $1 billion a year) on electric and driverless cars. The company, owned by China’s Geely, is launching EV models under the Volvo marquee and luxury performance sub-brand Polestar. Volvo has said it plans to get half its sales from fully electric cars by 2025 and expects its margins on electric cars to match those of vehicles with combustion engines by that time. “The future of Volvo Cars is electric and we are firmly committed to moving beyond the internal combustion engine”, Volvo president Håkan Samuelsson said in a statement. European auto makers typically source batteries from companies in China, South Korea and Japan, which dominate the supply chain for EV batteries. The United States has recently sought to limit China’s EV supply chain dominance. The companies said the battery deals were valued at several billion dollars but did not disclose detailed financial terms. Volvo said its first battery assembly line was under construction at its manufacturing plant in Ghent, Belgium, and would be finalised by the end of this year. It was building plug-in hybrid variants of the XC40 in Ghent and planned to make fully electric XC40s there, it added. +++


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