+++ AUDI is fast-tracking an electric vehicle programme that will see the German firm launch 20 fully electric cars by the middle of the next decade. A range of never-before-seen electric vehicles (EV) is in the pipeline, but some of the brand’s best-known models will also make the switch to electric power. While Audi’s focus will initially be on launching EVs at the upper end of its product range, where greater profits can be made, one of the most significant models to arrive will be a compact hatchback that will be priced from around €40,000 in The Netherlands. A rival for the forthcoming Volkswagen ID.3, as well as the Tesla Model 3, it will act as Audi’s entry point into EV ownership. The car will be the first of 3 cars from Audi to be based on the VW Group’s MEB architecture, designed for compact to mid-size vehicles. The model, which is expected to feature ‘e-Tron’ or ‘eO1’ in its name, will be similar in size to an Audi A3 but have greater levels of interior space afforded by the new platform. Audi’s positioning as the premium brand in the VW Group means it’s not likely to offer the car with the ID.3’s smallest 45 kWh battery; instead the choice will be between the 58 kWh and 77 kWh set-ups. This should offer a range of at least 400 kilometres, with up to 510 kilometres possible in a larger-battery edition that’s likely to rival the Model 3 on price. The MEB platform will let Audi offer entry-level cars with one electric motor at the rear, and a further motor on the front axle for those willing to pay extra for Quattro 4-wheeldrive. It’s expected that the model will hit the market in 2021, giving VW, Seat and Skoda time to launch their MEB cars first. With CO2 emissions targets putting more pressure on car makers to clean up their ranges, long-standing Audi models, which have for generations used combustion engines, are also set for a radical rethink. The next version of the brand’s flagship, the R8 supercar, is causing huge internal debate within the firm’s management. Audi’s CEO Bram Schot said in the spring: “Focusing also means leaving out. For example, the R8 sports car: do we need a successor with a combustion engine? Does this fit in with our vision? The discussion will give us an answer to that”. However, insiders have suggested that the R8 will have a successor and that it will be fully electric. Audi’s board member for technical development, Hans-Joachim Rothenpieler, told us that a technical solution has already been drawn up. “Normally you have a wheel at each corner with the battery pack in the centre, and the pack is 12 or 13 centimetres tall”, Rothenpieler told. “But this makes the base of the seating point higher. So for small, sporty cars with only two 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. That’s what we’re looking at for these iconic cars”. This principle could also apply to the TT; another of Audi’s long-standing models that will be making the switch to electric power. “In a few years, we will replace the TT with a new emotive model in the same price range: an electric car”, Schot revealed. Audi could put the electric TT and RE8 onto the PPE architecture it’s developing with Porsche. The platform is designed for low-riding models in a range of segments; the Porsche Taycan will be the first model to use the tech, while the Audi e-Tron GT 4-door coupé will follow in 2021. The e-Tron GT will be Audi’s third EV, following the e-Tron and e-Tron Sportback SUVs. It’s a direct competitor to the Tesla Model S and is expected to cost around €135,000 when it arrives in Dutch showrooms. The model will use a 95 kWh battery that will deliver a WLTP range of 400 kiloetres. The battery will power an electric motor on each axle, and these combine to produce 600 hp and deliver a 0-100 km/h time of 3.5 seconds. +++ 

+++ In EUROPE , consumers’ persistent appetite for SUVs and crossovers was no longer enough to lift the overall European market. In the first half, SUV/crossover sales increased by 5.9 % to slightly more than 3 million units, boosting their market share to a new high of 36.1 %; up from 33.2 % during the same period last year. Although 171,569 more SUVs and crossovers were sold from January to June, the surge failed to overcome a combined loss by sedans, station wagons, coupes, convertibles and minivans of 389,044 units; down 6.7 % to 5.42 million units compared with the first half of 2018. The end result is that the overall market declined by 2.5 % to 8.48 million in the half. An analysis of the SUV/crossover sales data shows that just 3 segments (premium compact, small and compact SUVs) grew while demand for larger SUVs from non-premium brands declined 30 %, resulting in a segment that has nearly gone extinct with a mere 5,423 sales in the first half of 2019. Demand for SUVs and crossovers also continued to push Europe’s MPV sales to the brink. Demand for small MPVs fell 38 % while compact MPV sales decreased by 33 %. “There’s no demand for those cars anymore. Everybody wants SUVs and crossovers”, Kia Europe chief operating officer Emilio Herrera told, while also confirming the South Korean automaker would stop selling the Venga and Carens. It will be another hard hit to the body style because the Venga ranked No. 3 in the small MPV segment while the Carens finished in the first half of 2019 at No. 9 in the compact MPV segment. European buyers are also walking away from mass-market niche models such as coupes and convertibles. Premium brands had avoided the slowdown in their niche derivatives until this year. In the first half of 2019, premium coupes lost a third of their volume and convertibles declined by 12 %. Price does not appear to be the core reason for the reduced appetite for premium coupes and convertibles. Europe’s exotic segment, which includes even more expensive coupes and convertibles, was the second-best performer percentage wise during the first half of 2019, with sales up by 52 % to 10,436 units. The recently launched BMW 8 series jumped to the top of the segment, taking a comfortable lead over the new Bentley Continental GT. These 2 models are performing at a different level compared with the rest of their competitors as they combined to account for more than 40 % of all exotic car sales during the half. The segment that gained the most percentage wise during the half was electric cars, led by strong demand for the Tesla Model 3. The Model 3’s performance also shook up the midsize premium segment as it ranked fourth behind the Mercedes-Benz C Class, Audi A4 and BMW 3 series but it was ahead of the new-generation Volvo V60. The Tesla Model S, which finished 2018 as the best-selling upper premium model in Europe, slipped to No. 5 in the segment during the first half of 2019. Other battery-powered models that cracked the top 10 in the 25 segments are the Kia e-Soul, Nissan e-NV200, Mercedes e-Vito, Smart ForTwo Electric Drive (Coupe & Convertible) and the BMW i3. +++ 

+++ 100 years ago, nearly half of the cars on British roads had the FORD badge. Henry Ford opened his first dealership here in 1910. A year later he chose Trafford Park, Manchester, as the site of his first Model T factory outside the US. He built the first British cars before 1911 and by 1914 he was making cars there on a moving production line. On that beginning Ford’s leading position in the UK car market was founded, along with the enduring notion that Ford is a British company. Although the Blue Oval no longer makes cars in the UK, it does make huge numbers of engines and employs 3.000 engineers at its Dunton design and engineering centre. But over the past decade it has struggled to make profits in Europe and has been through several bouts of ‘right-sizing’, involving retrenchments and plant closures, without much improvement of the bottom line. Meanwhile, its American rival General Motors has sold up and departed Europe for good. Given all this, and the unprecedented challenges car makers face over the next decade, I thought it right to visit Ford’s epicentre in Dearborn, Michigan, to meet the company’s leaders and learn their plans for the future, for Europe and for the UK. The following story reveals our findings. Darren Palmer remembers the moment his vision of electric cars changed. It drove him to leave a dream job launching exciting conventional cars to lead Ford’s headlong dash towards an entirely new kind of battery-propelled mobility. “I was in charge of Mustang, Explorer and Lincoln’s performance models, and having a great time”, Palmer recalls. Then out of the blue he got the call. The new challenge, it turned out, was to become product development director of Ford’s Project Edison, a 70-strong cross-functional think-tank set up in a former hosiery factory in Detroit’s Corktown district to conceive a new range of high-performance EVs. “I was unsure at first”, Palmer recalls. “For me, electric cars were more about sensible buying than the exciting cars I knew. Then Sherif Marakby, our autonomous vehicle CEO, said: ‘trust me this is going to be the next big development in cars’. When you know them, you’ll love them. And he was right. I just couldn’t believe how good these new cars were. They could do things you’d never do in an ICE (Internal Combustion-Engined) car. They were just better”. Such passion from Palmer, a tall, fast-talking Englishman who has spent much of his 28-year Ford career on the fast-track, is all the more powerful for the fact that this is the man who delivered Ford’s much-loved Fiesta ST200, a skunkworks pocket-rocket universally admired. He also delivered the Mustang to Europe, proudly watching it become the world’s best-selling sports car. He’s a car lover since childhood, so when he starts talking about this new strain of EVs being “sexy and emotional”, you need to listen. The big plan, first publicised by Ford around 18 months ago and expanded since, is to spend $11 billion on a cycle of exciting EVs beginning next year. Under the deal recently agreed with Volkswagen, Fords built on the MEB platform will kick in from 2023. The flow will start next year with a ‘Mustang-based crossover’. The name Mach One was floated early on, although it has since emerged that it will be called the Mach E. A battery Ford F150 will come before 2022, says Palmer, and a fully electric Transit. Palmer won’t confirm that a Ranger or Bronco (the famous compact 4×4 that’s returning with conventional power after disappearing in the mid-1990s) are in the electric mix, but he doesn’t deny it either. “We’re hitting our biggest icons first”, he says, “but we have more. And we’ll keep working through them”. Meanwhile, starting now, Ford is launching a new or renewed supporting range of smaller plug-in hybrids, first being the Kuga with a larger Explorer not far behind. Project Edison grew out of an earlier plan to build a second generation of the decent but dull economy EVs, such as a second-generation electric Focus. But the decision to stop making saloons in the US, along with a realisation that the way to sell new EVs at a profit was to build exciting cars closely related to existing icons, brought a new philosophy. “We decided very carefully where we’d play in the electric car market, and that every one would amplify the characteristics of the model it was based on. Each one had to be extremely desirable, but at an attainable price”, says Palmer. “These cars won’t necessarily be cheap, but they’ll be gotta-have-it models, sold at a price we judge is attainable for our existing customers. They’re our focus. Ford has always democratised technology and this will be more of the same. But early adopters of EVs have a lot to deal with, so Project Edison is working on every aspect of ownership, from the minute someone considers an electric car, through the whole web experience to buying, owning, using and charging”. On keeping costs under control (already a proven EV bugbear) Palmer acknowledges challenges but has answers. “We’ve planned the entire portfolio in one go”, he says. “We’ve selected a common battery cell for our EVs and set up long-term, large-scale relationships with suppliers, because 75 % of a battery’s cost is raw materials. “It’s vital that every EV is profitable because that means you can sell as many as customers want. If they’re not profitable you hold them back: why do you think so many of today’s electrics are subject to year-long waiting lists? We’ll launch, and we won’t lose money. That’s what will make our cars mainstream”. The EV range, Palmer admits, is something customers are obsessed about. Decent range hasn’t been generally available up to now, partly because of poor battery density, partly because of cost. But these things are improving, even if progress is slowed by rising demand. “A car’s range in miles begins with a 1, 2 or 3”, says Palmer. “Our research shows that when it’s a 3, anxiety drops away fast. A 300 mile-plus capability (480 kilometres) is something we’re aiming at”. It’s clear Palmer could continue his rapid-fire advocacy of electric cars indefinitely, except that he has at least 100 other things to do against a punishing timetable. (He explains, for instance, how an Edison-led team recently produced a completely new infotainment system for the Mustang-based cross-over in just 90 days, from plan to final hardware.) So we content ourselves with asking him to characterise the importance of the current era of car creation. “It’s the greatest change and opportunity in the auto industry in 30 years”, he says, “and probably a lot longer. Today’s performance EV cars isn’t just about the electric motor. It’s about software, surprises, over-the-air updates, cleverness, the fact it can learn and anticipate what you want, and makes your life better. It’s an entirely new kind of product. Those who try it will never go back”. +++ 

+++ U.S. president Donald Trump, who is engaged in a trade war with Beijing, said that the largest U.S. automaker, GENERAL MOTORS , should begin moving its operations back to the United States. “General Motors, which was once the Giant of Detroit, is now one of the smallest auto manufacturers there. They moved major plants to China. This was done despite the saving help given them by the USA. Now they should start moving back to America again?”, Trump said. Trump appeared to be referring to a news story that reported GM’s hourly workforce of 46,000 U.S. workers has fallen behind that of Fiat Chrysler Automobiles as the smallest of the Detroit Three automakers. Over the past 4 decades, GM has dramatically cut the size of its overall U.S. workforce, which numbered nearly 620,000 in 1979. GM did not directly comment. “GM’s China operations are not a threat to U.S. jobs”, the company said in a fact sheet, noting that its joint ventures have sent $16 billion in equity income to GM since 2010 and that it has invested $23 billion in U.S. operations since 2009. GM’s U.S. hourly workforce has fallen by about 4,000 jobs since the end of 2018 to about where it was a decade ago”. Trump’s ire with GM comes as contract talks with the United Auto Workers union with the Detroit Three automakers intensify ahead of a Sept. 14 deadline. Trump has previously attacked GM for building vehicles in Mexico and for ending production at plants in Michigan, Ohio and Maryland and threatened to cut GM subsidies in retaliation. GM’s decision to close 4 plants in the United States is a central issue in the contract talks. Trump has made boosting auto jobs a key priority and has often attacked automakers on Twitter for not doing enough to boost U.S. employment. His 2020 re-election bid will hinge on holding key industrial battleground states like Wisconsin, Pennsylvania and Michigan that narrowly voted for him in 2016. China is the world’s largest auto market, and government policy favors automakers assembling vehicles there, and not importing them from overseas. In response to Trump’s latest tariffs, China said last week it will reinstitute 25 % tariffs on U.S.-made vehicles. The U.S. is imposing 15 % tariffs on more than $125 billion in Chinese goods. GM sold 3.6 million vehicles in China last year, accounting for 43 % of its worldwide sales. GM booked $2 billion in equity income from its China operations last year. GM imports a small number of vehicles from China. In June, the Trump administration rejected a request from GM to exempt its Chinese-made Buick Envision from a 25 % U.S. tariff on SUVs. The midsize SUV has become a target for U.S. critics of Chinese-made goods, including leaders of the UAW members in key political swing states such as Michigan and Ohio. +++ 

+++ In a few weeks from now, Volkswagen’s ID family of EVs will make the long-awaited transition from concept to production as the first model people can actually buy will be officially unveiled. VW has just confirmed that the ID.3 will debut at the 2019 Frankfurt Motor Show, bringing “ground-breaking design, greater ranges, impressive driving dynamics and spacious interior”. The compact production EV will be joined on stage by other unnamed concept vehicles from the ID family. Volkswagen likens the ID.3 to the Beetle and the Golf: that’s how important it anticipates the model to be for the company. Based on the new modular electric drive matrix (MEB), the ID.3 will be the carmaker’s first EV built from the ground up with all-electric propulsion in mind. The EV platform allowed for “the largest possible vehicle interior”, according to Volkswagen. More importantly, the carmaker promises range anxiety will be a thing of the past with the ID.3 which offers 3 different battery sizes. The base 45 kWh unit can store enough juice for a driving range of 330 kilometers while the top 77 kWh battery extends the range to 550 km. A medium-sized 58 kWh battery will also be on offer with 420 km of range. VW also says the ID.3’s batteries will offer “excellent charging capacity”. For example, a range of approximately 290 km can be recharged in just 30 minutes on the base model using 100 kW charging. The carmaker says the capacity of the ID.3 batteries is guaranteed to last for 8 years or 160,000 kilometers. Besides convenience, the ID.3’s rear-wheel drive and 204 hp delivered by the rear-mounted electric motor promises driving pleasure as well. Last but not least, the ID.3 will be priced in Germany from under €30,000, which roughly equates to €33,000 in The Netherlands. Production will start at the end of 2019 and the first vehicles are scheduled to reach customers by mid-2020. +++ 

+++ INDIA is targeting automakers with a charm offensive aimed at encouraging them to shift business out of trade war-hit China. Several Indian officials met on Aug. 14 and discussed a list of “target companies”. The dispute between the United States and China, the world’s 2 largest economies, has led to higher tariffs on goods worth billions of dollars and disrupted global supply chains, prompting companies to look at other investment avenues to escape higher tariffs. Amid suggestions that India is late to capitalize on the trade war, government ministries have been asked to submit their policies and incentive structures to Invest India, the country’s foreign investment promotion agency. 9 sectors, including autos will be targeted. The government will meet companies between Aug. 26 and Sept. 5 to suggest the best investment zones for their operations. State governments will also participate. A “complete package” detailing market factors and Indian incentives on offer will then be readied for presenting to potential investors. It is not clear whether the government will dole out new incentives or just detail existing ones, but the document shows India wants to explore opportunities and move swiftly, even as some fear it has missed the bus. As companies think about rebuilding supply chains outside of China, a major global manufacturing hub, nations such as Vietnam have emerged as top destinations given the faster clearances and stable policies they offer, industry experts say. “There is one other monster country that has a huge domestic market, India, but they have got to get moving”, said Richard Rossow, a U.S.-India specialist at the Center for Strategic and International Studies in Washington. “There is no time to waste in catching that new wave and in fact the question is: have they already missed it?” The Sino-U.S. trade war has also rattled global automotive supply chains and affected big automakers. China plans to hike duties on U.S. cars by 25 % in December. Indian officials this week separately met local delegates of automakers including Volkswagen, Hyundai and Honda to see if they would consider moving some supply chain operations from China to India, according to the source and an industry official who attended the meeting. “The government is looking at it as a great opportunity”, said the industry official. +++ 

+++ The fifth generation JEEP Grand Cherokee expected for the 2021 model year will be thoroughly redesigned from the outside and the inside. The interior gets much sleeker, the instrument panel taking on a steep rake and flowing into the center console, the HVAC vents adopting a horizontal shape to emphasize width. The standard dash cluster will include a new 7 inch, high-definition TFT screen, with a 10.5 inch cluster available depending on options or trim level. Drivers will look over a new steering wheel to see a new heads-up display. The 7 and 8.4 inch Uconnect screens will carry over with new bezels, but a 10.1 inch Uconnect screen will become the top option, able to display images from a new 360-degree camera system. The shift lever for the ZF 8-speed automatic will be replaced by a rotary dial. A new Select Terrain dial is expected to offer more aggressive off-road modes, and on the Trailhawk, will control a next-generation air suspension that can raise and lower itself more quickly. The SUV is expected to be built on the same Giorgio platform that supports the Alfa Romeo Giulia and Stelvio. The architecture could be split into 2 wheelbase lengths: a standard size with 2 rows of seating codenamed WL74, and an extended wheelbase codenamed WL75 with 3 rows. It’s said that the 3-row version will wear the same interior and exterior, but could go by a different name. The big engine news is the planned arrival of the turbocharged inline-6, thought to have a displacement slightly larger than 3.0 liters. A 2.0-liter turbo 4-cylinder with eTorque could serve the low end of the engine range, above that a revised version of the 3.6-liter Pentastar V6, a 5.7-liter Hemi V8 potentially with eTorque assistance, and a third-generation 3.0-liter EcoDiesel. The new Grand Cherokee debut is predicted to happen at next year’s Detroit Auto Show, which moves to June 2021. +++ 

+++ A new variant of the MCLAREN 720S supercar has been spotted testing at the Nurburgring, pointing to a hardcore, uprated ‘longtail’ version of McLaren’s Ferrari F8 Tributo rival being in the works. Rumoured to take on the 750LT name, it’ll employ the same ethos as the 675LT and the 600LT, packing more power than the 720 hp of the 720S it’s based on, shedding weight and majoring on aerodynamic proficiency, with several key changes to the bodywork and wings, and an extended rear justifying the longtail name. The engine will almost certainly be inherited directly from the 720, with McLaren’s one-size-fits-all 4.0-litre turbocharged V8 mounted in the middle, driving the rear axle via a 7-speed dual-clutch automatic gearbox. Power will rise though through engine management changes though, while 750 hp would lead to a 750LT name. A new front chin splitter sprouts from the front, while a pair of aerodynamic canards will be placed near the front wheels. The bodywork will be extended, but one of the biggest giveaways will be the appearance of a gurney flap on the trailing edge of the rear wing, fitted to increase downforce. The exhausts will exit alongside the tail lights, just as you’ll find on the regular 720S. On previous LT models the exhausts have been modified to exit out of the rear deck, straight from the engine bay, though this may be the case by the time the 750LT makes production. Like previous LT McLarens it’ll be sold in limited numbers, and a reveal could take place before the end of the year. +++ 

+++ MERCEDES-BENZ will assemble its first full-electric vehicle, first AMG performance car and an additional gasoline crossover at its joint venture with BAIC Motor this year, complying with local rules requiring automakers to expand electrified vehicle output. The 3 vehicles are the EQ C, the elongated AMG A 35 and the GL B, according to information BAIC, a Hong Kong-listed company, disclosed in its mid-2019 financial report. The EQ C will become the first locally produced electric crossover to be marketed under a luxury brand in China. Mercedes sells Germany-built AMG cars in China. The GLB will become Mercedes’ third locally produced crossover sold in the market, following the GLA and GLC. It’s unclear when the three new locally produced models will go on sale in China. Local production also enables Mercedes to avoid paying tariffs at Chinese customs. In addition to the GLA and GLC, Mercedes assembles stretched A-, C- and E-class sedans at its partnership in Beijing. In the first 6 months of 2019, Beijing Mercedes-Benz, the joint venture headquartered in the Chinese capital of Beijing, delivered about 282,000 locally produced vehicles in China; a jump of 12 % from the same period last year. Mercedes also assembles 3 Vans (the Vito, Sprinter and V class) at a separate partnership with BAIC in Fuzhou, capital of east China’s Fujian province. In the first half, Fujian Mercedes-Benz, the Van joint venture, sold roughly 13,000 units; a drop of 9.3 % year on year. Behind robust sales at its car joint venture with BAIC, Mercedes’ China deliveries edged up 1.3 % to 344,657 in the first 6 months. The number includes the German luxury brand’s imported vehicle sales. +++ 

+++ Motorcycles thundering through residential neighborhoods, revving their engines and waking up every child in the street, may soon be a thing of the past in France. A PARIS suburb is trying out a new system that can identify noisy vehicles, pinpoint their location and automatically ticket them. The device, which the mayor calls a “noise radar”, has been installed on a lamppost in the center of Villeneuve-le-Roi, a town next to Paris Orly airport. It will be activated as soon as a new government draft law permitting such systems is passed, said mayor Didier Gonzales. The town will link the sound recordings to police cameras and automatically issue tickets to offenders. “Noise is the bane of modern life and a major health issue. It hurts people like secondary smoking does”, said Gonzales, who is also head of noise pollution agency Bruitparif. The draft law, expected to be voted on this autumn, will allow local authorities to experiment with systems to record and fine riders who exceed noise limits. France already has legislation limiting vehicle noise, but it is hard to enforce as it relies on police catching offenders individually. “We have nothing against Ferraris or Harley Davidsons, but their owners sometimes like to demonstrate their vehicles’ power and the noise really troubles residents”, said Villeneuve official Remy Jourdan. The new device, developed by Bruitparif engineers, has 4 microphones that measure decibel levels every tenth of a second and can triangulate where a sound originates. It displays a picture of an acoustic wake as a trace of colored dots behind a moving source of loud noise, such as a souped-up motorcycle. “With this tool, it is not possible to dispute who made the noise”, said Gonzalez. Nearly 40 of the devices have been in operation for several months near busy bars in Paris entertainment areas, and another 17 have been installed at major building sites, Bruitparif director Fanny Mietlicki said. Bruitparif is now beginning to track vehicle noise and also installed one in Saint-Forget, a hilly rural area near Paris popular with motorcyclists. In September it will install 2 in central Paris. So far, the system is in trial mode only and no fines have been issued, but Villeneuve is in contact with the transport ministry to activate it as soon as the new law is passed. The government plans a 2-year try-out period to test technology and define the noise levels that will trigger fines. +++ 

+++ POLESTAR , Volvo’s electrified performance-vehicle brand, launched hybrid and electric vehicle output at a new plant in the southwest China city of Chengdu. Polestar, a Tesla challenger, is targeting sales in China and abroad. The first product to be assembled at the factory, known as the Polestar Production Center, is the Polestar 1, a carbon fiber-bodied plug-in hybrid coupe more than 600 hp and 1,000 Nm. The Chengdu site, which includes a customer experience center and test track, is jointly owned by Volvo and its corporate parent, Zhejiang Geely Holdings Group. The center will build 500 Polestar 1 units each year, with total output of 1,500 planned over a 3-year production cycle, Polestar said. Polestar expects to start delivering the plug-in hybrid to customers before the end of the year. Production of the brand’s second product, the Polestar 2 electric midsize sedan, is due to begin in early 2020 at Geely’s Luqiao factory in east China’s Zhejiang province, which now builds the Volvo XC40 and the Lynk & Co 01 crossovers. All 3 Luqiao-made vehicles are based on Volvo’s Compact Modular Architecture. Lynk & Co is a brand jointly owned by Geely and Volvo. Earlier this year, Polestar started taking orders for its first 2 models in China. In Europe, the Polestar 1 starts at €155,000 and the Polestar 2 at €39,900. The brand aims to open 20 stores in China by the end of next year. It expects to open the first store in the Chinese capital city of Beijing in the third quarter, with plans for stores in 10 other major Chinese cities (including Shanghai, Shenzhen, Hangzhou, Chengdu, Chongqing, Wuhan, Xi’an, Nanjing and Xia’men) before the end of 2020. Polestar also expects to export the 2 China-built vehicles to Western Europe and North America, though it has yet to set timetables for the shipment. +++ 

+++ Ride-hailing giant Didi Chuxing plans to start using SELF-DRIVING VEHICLES to pick up passengers in a district of Shanghai city and hopes to expand the scheme outside China by 2021. The service will allow passengers who hail a vehicle in the city’s Jiading district via Didi’s app to choose to be picked up by a self-driving car, the firm’s Chief Technology Officer Zhang Bo said at the World Artificial Intelligence Conference. The cars will still be staffed with a human driver, he said, adding that more than 30 different types of car models will be offered in the pilot service, all equipped with Level 4 autonomous driving capabilities. All self-driving rides will be free of charge. Zhang told reporters that Didi intends to go live with the service in a matter of months, but that it was waiting for some licences. The firm won permits from the Shanghai government to test its self-driving fleet. Didi hopes to have the so-called robotaxis in 3 Chinese cities (Beijing, Shanghai and Shenzhen) by 2020 and intends to launch outside the country by the year after, he said. Didi is also in talks with Toyota, with which it set up a joint venture last month focused on mobility services, on self-driving technology, he said. He added that he believed transportation technology providers will form a set of “alliances” that provide a combination of a ridesharing network and an ability to make cars. “There will be no more than 3 alliances that can provide a real product”, he said. “Self-driving vehicles will be one of the most important areas in artificial intelligence over the next 10 years”. Earlier this month, Didi said it had spun-off its autonomous driving unit into an independent company that will focus on research and look to deepen collaboration with automakers, with Zhang as its CEO. Tech giants such as China’s Baidu and Waymo as well as traditional carmakers have been racing to put full commercial self-driving vehicles on the road. However, some have stumbled due to the difficulty and expense of developing self-driving cars capable of anticipating and responding to humans in urban areas. In December, Waymo began charging passengers to use its driverless vehicles in a roughly 160 km zone in 4 U.S. suburbs, putting it ahead of U.S. rivals. +++ 

+++ The fifth generation SUBARU WRX arrives late next year with a new platform and engine as part of the automaker’s Japanese-market overhaul of the WRX STI, JDM-only WRX S4 and Levorg. The STI is expected to switch from the current turbocharged EJ20 boxer-4 to a direct-injection FA20 boxer-4 engine with output of around 315 hp. Note, the Japanese-market WRX STI uses a 2.0-liter engine, the U.S version gets the 2.5-liter EJ257 with 310 hp. The U.S.-market WRX (sans STI) already uses the turbo FA20, but it makes 268 hp. The WRX STI will finally move to the Subaru Global Platform that the Impreza switched to in 2017, which will hopefully go a long way in improving ride comfort around town. The 6-speed manual makes the switch as well. The 4-door’s size won’t change much, but the looks will crib from the Viziv concept (something everyone wants) with a design language called “Dynamic x Solid”, U-shaped LEDs, and “greatly inflated front and rear fenders”. The WRX S4 and Levorg will benefit from 2 brand new, downsized, direct-injection turbocharged engines in Japan: 1 of 1.5 liters, the other of 1.8 liters. Built around smaller, lighter engine blocks and boasted improved combustion efficiency, the 1.5-liter will produce about 148 hp, the 1.8-liter about 266 hp. Our non-STI WRX gets a 2.0-liter FA20 with 268 hp. Considering the similar horsepower, I wouldn’t be surprised if Subaru continues to use the FA20 in the U.S.-spec WRX in the next-generation car since it’s already certified for the U.S. and aftermarket parts should be easy to adapt to the new car. It’s possible Subaru will preview all 3 new models at this year’s Tokyo Motor Show. +++ 

+++ China will exempt TESLA ’s electric vehicles from its purchase tax, the Ministry of Industry and Information Technology (MIIT) said; a concession made amidst trade tensions with the United States. Tesla sees China as one of its most important, growing markets, and the exemption from a 10 % purchase tax could reduce the cost of buying a Tesla by up to 99,000 yuan ($13,957.82). 16 variants (all the Tesla models sold in the country) are listed on a document issued by MIIT on its website, including Model S, X and 3. No reason was given for the decision to exclude the cars from the tax, but it comes as Tesla is expanding in China, with a new factory and visits by Chief Executive Officer Elon Musk. Tesla’s plant in Shanghai will be its first overseas factory, and the company is gearing up for a major Chinese sales push by promoting racing events, showroom parties with DJs and a line of Chinese Tesla stickers for chat apps. Musk has met with senior leaders, including China’s vice president Wang Qishan, and the transportation minister. He also has publicly praised China in the midst of tensions with the United States, thanking the Shanghai and national governments for support, calling national leaders “very thoughtful” and describing China’s “amazing” progress in sustainable energy, transport and space. “This year they did more orbital launches than the USA for the first time”, Musk said in December. “It is pretty clear Tesla is committed to China, with the investment in the Shanghai Gigafactory. Those relationships probably helped Tesla lobby for a successful exemption from the tax”, Roth Capital analyst Craig Irwin said. “Now we need to closely watch the build out of the Shanghai Gigafactory and Model 3 volume ramp in China”, Irwin added. While the company does not disclose sales by country, consultancy firm LMC Automotive estimates sales of 23,678 Tesla vehicles in China in the first 7 months this year, nearly double the number of cars it sold a year earlier. +++ 

+++ Deutsche Post has received expressions of interest from potential partners for STREETSCOOTER , its electric van business, board member Tobias Meyer said. “We see broad interest along the entire value chain”, Meyer said, adding that Deutsche Post was in contact with car parts makers, electric vehicle manufacturers and operators. The German postal services group has produced 10,000 ScreetScooters but is shying away from making large investments in StreetScooter or taking on risks tied to large-scale vehicle production. Last year it hired Goldman Sachs to evaluate options for StreetScooter as it seeks to expand the unit and tap an expected rise in demand. Deutsche Post boss Frank Appel has said options include cooperating with manufacturers, floating the firm on the stock exchange or bringing in a financial investor. Deutsche Post has also installed around 13,500 charging stations in its depots and delivery bases throughout Germany. Meyer said the number of e-vehicles used by the group would continue to rise. +++ 

+++ TOYOTA will not build cars at its British factory the day after Britain leaves the European Union as part of plans to handle any disruption from a potentially disorderly Brexit. The autos sector, Britain’s biggest exporter of goods, has been one of the most vociferous opponents of a no-deal Brexit, warning that production would be hit with tariffs, border delays and new bureaucracy, ruining the viability of plants. Prime Minister Boris Johnson has promised that Britain will leave the European Union on Oct. 31 with or without a deal. Toyota built just over 8 % of Britain’s 1.52 million cars last year at its Burnaston factory and began production of its new Corolla model there earlier this year. “We will have a production pause on the first day of Brexit, which is Friday 1st, and then we will restart production on the Monday and the Tuesday”, said a spokesman. “We don’t know what the actual situation will be like. We’ve already pulled forward a couple of days of extra inventory which we will then use on the Monday and Tuesday and we will have to see what the situation is after that”, he said. British car factories are integrated into supply chains which can stretch around the world and operate just-in-time manufacturing processes which mean some parts arrive minutes before being fitted onto vehicles rolling off production lines. Toyota said no volume would be lost from the pause in output. +++ 

+++ UBER chief executive Dara Khosrowshahi says it appears as though former Google and ex-Uber self-driving expert Anthony Levandowski did indeed steal documents from the search engine giant. Earlier this week, Levandowski was charged with 33 counts of stealing trade secrets from Waymo, where he was a key executive. After leaving with Alphabet’s self-driving car division, he briefly jumped ship to Uber, allegedly with these sensitive documents, before the ride-hailing company fired him in the midst of a huge lawsuit between itself and Waymo. Khosrowshahi said Uber did everything it could to ensure documents from Waymo were not brought over to it. “I wasn’t here when we brought Anthony on board, but what I do know is that we went to incredible depths to makes sure that any information that Anthony might have acquired from Google (and it sure looked like he did) didn’t make it over to our company”, Khosrowshahi said. “That was our responsibility and I think we were incredibly diligent in making sure that we were not guilty of anything that could be nefarious one way or another”. This issue prompted a multi-million dollar lawsuit between Waymo and Uber in 2017. Waymo asserted that Levandowski stole 14,000 documents relating to information about its self-driving cars. The autonomous vehicle engineer went on to establish self-driving truck startup Otto that was later sold for $680 million to Uber. When put on the stand during the 2017 trial, Levandowski pleaded the Fifth. Waymo and Uber ultimately reached a settlement in early 2018 that saw the ride-hailing giant pay roughly $245 million in equity to Alphabet. +++ 

+++ VOLKSWAGEN is set to invest $577 million at one of its Brazilian facilities. The German car manufacturer made the announcement as Sao Paulo state governor Joao Doria was making a visit to the VW headquarters in Germany. Doria has been pushing for automakers in the thriving Brazilian city of Sao Paulo to retain their manufacturing plants in the area following moves from other states across the country to introduce generous tax incentives to attract carmakers. This year, Doria announced a tax plan that will see car companies granted a 25 % reduction in value-added taxes if they invest at least 1 billion reais ($239 million) at their Sao Paulo factories and create at least 400 new jobs. The governor was encouraged to introduce the tax incentive following an announcement from General Motors late last year that it could close or severely reduce its operations in the state due to heavy financial losses. According to the Sao Paulo state, Volkswagen’s investment at its Anchieta plant in São Bernardo do Campo, about 20 km from Sao Paulo city, will create 1000 new jobs as part of the significant investment. The Anchieta site was established in 1957 as VW’s first plant in Brazil and the first Volkswagen plant outside of Germany. The plant has built more than 13.8 million vehicles and currently employs over 8600 people. It handles production of models including the Polo, Virtus, Saveiro and Saveiro Cross. +++ 

+++ WAYMO has asked the National Highway Traffic Safety Administration (NHTSA) to remove regulatory barriers for vehicles without steering wheels and brake pedals. The self-driving division of Alphabet has been encouraging the NHTSA to loosen regulatory hurdles for autonomous vehicles that require car manufacturers to meet nearly 75 auto safety standards. In a recent letter published in response to the NHTSA seeking public comment “on the removal of unnecessary regulatory barriers to the safe introduction of automated driving systems”, Waymo said the safety agency should look at the safety standards which assume a human is behind the wheel and proceed from there. By doing so, Waymo says regulation changes will “enable the timely deployment” of vehicles without traditional controls. Waymo is not the only company asking for changes from the NHTSA. General Motors said “it is imperative that NHTSA continue to drive this critical dialogue with a sense of urgency so that the necessary regulatory evolution keeps pace with advancing technology”. Similarly, both Lyft and Honda suggested the agency considers autonomous cars as a distinct vehicle class to help address current regulations shaped for cars with human drivers. It will, however, take some time for such changes to be implemented. The NHTSA allegedly won’t start writing rules on different seating positions in passenger cars until March 2020, and it could take until 2025 before comprehensive changes are made to vehicle safety standards relating to autonomous vehicles. +++ 

+++ Automakers have suffered renewed disruption to sales because of changes in the European Union’s vehicle type approval regulations. Some brands such as Volkswagen, Audi and Nissan may not be fully ready for the introduction of the new tests. Starting September 1, all new passenger cars sold in Europe must be re-certified according to updated parameters for the Worldwide harmonized Light vehicle Test Procedure ( WLTP ), which was introduced a year ago to replace the previous New European Driving Cycle (NEDC). Most brands are on schedule with the certification of their vehicles but VW said that it still had work to do. “With very few exceptions, all engine-transmission combinations will be certified under the new emissions norm”, Volkswagen said in a statement. “The remaining ones will then follow in the subsequent weeks”. VW’s commercial vehicle division is less prepared, admitting that only 33 % of its engine-transmission variants had been certified at the start of this month. “There will be temporary restrictions”, a spokesman said. These are expected to include the Crafter, which will not be available in all configurations until 2020. Volkswagen was hit the hardest by the shift to WLTP rules last year because much of its certification capacity was being used in the last couple of years to help it deal with the regulatory aftermath of its diesel-emissions cheating scandal, causing delivery bottlenecks and a big hit to sales. Dealers have been hurt this year by delays in getting new vehicles. “We have been feeling the distortions it caused for months. Important volume models could not be offered or were only available in very limited supply”, said Timm Moll, head of the Moll Group, which specializes in the sale of VW Group models. “Customers that migrated to other brands as a result have been lost for years to come”. At the start of this year, Volkswagen said it could not rule out temporary bottlenecks in supply during the second half of 2019. It also said it incurred costs of about €1 billion last year in connection with a limited offering and higher incentives to sell cars that could not be certified for sale in time for the initial introduction of WLTP last September. Industry observers do not foresee the same level of disruption that hit automakers in 2018. “We do not expect to see any major disruptions in the coming months and the new regulation will be far less disruptive than WLTP in September last year”, Arndt Ellinghorst from Evercore ISI analysts said. The main change in type approval includes a longer evaporative (EVAP) emissions test for gasoline-powered vehicles to measure escaping hydrocarbon vapors when parked over a 48 hour period. “Every engine-transmission combination must be tested once more”, said Patrick Gerstmeyr of technical service provider TüV Süd, a company that oversees the tests on behalf of the German regulators. While the time involved is similar to the transition from WLTP, he believes engineers have learned their lesson after last year’s problems. “This time the carmakers appear to be somewhat better prepared and the overall test bench capacity has been expanded”, Gerstmeyr said. Mercedes-Benz, for example, said it doubled the manhours at its Stuttgart-based laboratory, which conducts certification tests for all global markets except Japan. Currently, it is running a 3-shift operation during the week and sometimes even on Saturdays to keep up with the workload. Part of the problem in changing to the new regulations is that cars often have to “soak” between tests. This refers to when a test vehicle is left in a environmentally controlled room for up to 12 hours to prepare it for the following regulatory test. It can take 10 workdays to get a vehicle through all the necessary steps associated with high- and low-emissions measurements in humidity-free conditions. “The actual time setting up the vehicle and operating it on the test bench might only take 1 hour, but it is all the steps in between that cost real time”, said Harald Behrendt, senior manager for powertrain testing at Mercedes parent Daimler. For example, since cars can only be certified with an EU-harmonized reference fuel, the vehicle that comes off the assembly line has to have its tank drained and then be refuel. Testers also have to factor in soak times to ensure engine oil and coolant temperatures reach acceptable testing levels. The EVAP test requires its own test chamber, called a SHED, short for Sealed Housing for Evaporative Determination. Mercedes has four in its Stuttgart measurement center in addition to its eight emissions-test benches. +++

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