Newsflash III


+++ AUDI in May outlined a strategy focused on sustainability that includes having 30 models with electrified drivetrains, of which 20 will be full-electric, by 2025. Audi has earmarked 14 billion euros toward electric mobility, digitalization and autonomous driving and a total of 40 billion euros toward improving its standing in the ultra-competitive premium sector, where it trails Mercedes-Benz and BMW in global sales. CEO Bram Schot is more focused on profit margins than volumes. He says the biggest challenge that Audi faces next year is a combination of 2 things: markets and investments. “Next year will remain challenging on the markets side, including in China, but we are slightly optimistic on the outlook for the premium segment there. In general, we do not see the main markets growing, with price pressure challenging our premium business. We foresee Europe being stable, but the quality of sales has already deteriorated a little bit. We anticipate a lot of pressure in the U.S., where we would be happy to see a stable market. Therefore, if you want to improve your results and market situation, it will be even more important to improve your own performance”. Schot says Audi will be investing €14 billion in select future-focused areas as part of its current 5 year plan. “That’s a lot. And our total investment during the period, which runs through 2023, will be €40 billion. That has to be financed. With flat markets, growth won’t come from higher volumes, it has to come from improving performance. Getting the right margin is the real issue”. Schot thinks he can achieve this because Audi has seen the first positive results from its transformation plan. “Our operating return on sales is about 8 % and that looks much better than our competition. If you start making your company less dependent on volume and get more out of lower costs and improved flexibility, then you can start growing your brand”. The biggest challenge on the investment side for Schot is finding the right balance on where Audi puts its money to achieve the maximum impact. “How do we split our investments in full-electric cars and plug-in hybrids? How do we tackle autonomous driving and shared mobility on the investment side? This is really challenging as all these business models are linked and we have to take into account various external factors such as infrastructure”. The toughest part of getting customers to consider electric vehicles is creating more opportunities for them to test electric cars, Schot says. He adds that the recharging infrastructure is still an issue in Europe: “Electric mobility has to become suitable for everyday use. That is why we offer our e-Tron customers the e-Tron Charging Service. They have access to more than 110,000 charging points throughout 20 European countries. At the same time, it is crucial that the overall availability of charging points has to be scaled. Only then will e-mobility spread. Schot agrees with ACEA chairman Carlos Tavares who said he believes Brussels is listening to automakers but it isn’t hearing the message: “Clearly, there could be more done in some areas, but I’m not pointing fingers. We, as the automotive sector, also have to do our homework. And we are not done yet. At the same time, we can see what the Netherlands has done, and being Dutch, I’m proud to praise my country. When you see the number of charging points in the Netherlands compared with, for example, Germany, you see that creating a charging infrastructure is fundamental. The Netherlands achieved this because the authorities wanted to get people to make a change. So trades-offs where created. Schot: “This shows the move to electrification can work. There is money to be made there. There is a business model. And everyone was well aware that this would only work if there was an adequate infrastructure to recharge the cars. I think that the Dutch as well as the Norwegians and other Scandinavian countries, for example, have done a very good job”. By 2025, Audi plans to have 20 full-electric and 10 plug-in hybrid models. Schot expects to have electrified models account for 40 % of Audi’s global sales in 2025. +++ 

+++ BMW bosses have revealed that an entry-level, electric hatchback based on the 1 Series is in the product plan. And it could be here as early as 2021. The German firm has outlined an electrification strategy under which 12 fully electric cars and 13 plug-in hybrids will arrive in showrooms in the next 4 years. BMW is targeting the more premium and more profitable segments initially; the first to arrive will be the iX3, followed by the i4 and then BMW’s technological flagship, the iNext. However, the head of the i Division, Robert Irlinger, has now suggested that BMW’s flexible vehicle architectures will allow the firm to explore the option to develop more affordable and smaller electric vehicles. “Even in the front-drive architecture you will see fully electrified cars”, he told. “You will see electrification in our whole portfolio. We can rework our frontwheeldrive as well as the rearwheeldrive platforms and both are able to show all technologies: our customers have the power of choice. “Whatever they demand they can get: a plug-in hybrid X3, a fully-electric 4 Series, too. That’s a big step and a big change in our strategy”. BMW’s strategy for its range of electric cars is to keep them visually similar to their conventionally powered counterparts. It’s expected that an electric 1 Series will simply be marked out by flashes of brighter bodywork and a blanked-off front grille. The flexibility of the firm’s platforms will also enable BMW to offer the electric hatch with the option of 2 electric motors, to give fourwheeldrive, or a single motor that will deliver frontwheeldrive at a lower price point. The i4 gives a clear hint at the naming strategy, with Irlinger revealing that it will be an all-electric version of the next 4 Series Gran Coupé. “The i4 is the 4-door sports sedan, fully electrified, clearly visible as an iCar”, he explained. “You can see the concept of the 4 Series as a 2-door coupé and the i4 is going be the 4-door coupé; it’s going to be based on the concept, but it’s fully electric”. With the iX3 and i4 confirmed, the X5 sized iNext could be badged iX5. With that in mind, it would be logical for an electric 1 Series to wear an i1 badge and for an electric 3 Series to wear an i3 badge, but where would that leave the car that started the i brand off, the current i3? Irlinger added fuel to the rumours that the i3 as we know it won’t be replaced. “We are not in the normal process of having a car that has to have a successor”. +++ 

+++ Among all the oily bits and electronics coming our way as cars get more sophisticated, there are some technologies that we’ll never even notice. Some are visible but hiding in plain sight, yet they could still have a huge role to play in the future of the car. A good example is the clever science going into functional COATINGS used to make batteries smaller, safer and more sustainable, help lidar sensors to spot dark cars in poor visibility (which they struggle to do) and allow sensors to work better in wet and mucky weather. PPG Industries may not be a household name but the industrial giant is the largest manufacturer of paints and coatings in the world, and that includes the paint a body shop uses if your car is involved in a shunt. It predicts a diminishing market for car repair products with the move towards autonomy and accident-free roads, but that has also triggered ideas for new uses of coatings. 2 of those are aimed at improving lithium ion battery cells, a crucial component of which are chemical binders used in the manufacture of electrodes. As it stands, the binder used for each cathode in a lithium ion battery contains a toxic solvent called N-methyl 2-pyrrolidone. It’s being phased out under European regulations so PPG has developed a sustainable non-toxic substitute. It makes commercial sense as the area needing coating in a battery is 10 times the painted area of a car bodyshell. The second material is a ‘smart’ fireproof cladding. Battery packs are currently protected with a thick, fireproof blanket material that adds to their bulk. A new coating will replace that and can be applied to the outside or inside of a battery casing like paint. At high temperatures, either caused by an internal battery fire or external factors, the coating expands like a sponge by 50 times, forming an insulating layer. In flame tests, aluminium sheet buckles in 30 seconds, but protected by the new material, it remains intact after three minutes. That buys much more time for a car’s occupants to make themselves scarce. Lidar is being targeted for new treatments too, or rather the cars it targets are. One thing lidar can’t stand is black or near-black paint colour because it does a poor job of reflecting the light back to the lidar scanner that enables it to ‘see’ the object, especially in poor visibility. Some 20 % of the world’s cars are black so that will be a problem if lidar is widely adopted for autonomous cars. Laser light is classified as near-infrared (NIR), so PPG is developing a near-infrared transparent coating. Roughly translated, this means the black base colour you see on a car body will let the laser light through, to be reflected back by a special pale primer underneath. The upshot is that the lidar can see through the black colour to the reflective surface below, but to the naked eye, it still looks black. Clever stuff. +++ 

+++ The whistleblower case for embattled FIAT CHRYSLER AUTOMOBILES (FCA) American sales chief Reid Bigland will remain in Detroit. U.S. District Judge Gershwin Drain denied a motion from FCA’s legal team to move the case to Delaware. FCA attorneys tried to persuade the court to consider the automaker’s equity incentive plan, which “designates Delaware as the exclusive jurisdiction for any matter relating to the plan”. One of Bigland’s claims is that the company retaliated against him for selling his FCA stock. But FCA’s reasoning didn’t hold up, with the judge agreeing with Bigland’s side that the suit is a retaliation case not covered by stock agreement language regarding the venue for litigation. The court said Bigland is a Michigan resident, “the place where the pertinent agreements were executed and performed, as well as where the alleged retaliatory conduct occurred”. “We’re pleased about it. Michigan is the correct forum”, said Bigland’s attorney, Deborah Gordon. “We’re raising whistleblower and retaliations claims that are not covered by the stock agreement”. Bigland accuses FCA of withholding 90 % of his pay after he cooperated with federal investigators probing years of incorrect sales reports. Bigland’s lawsuit claims FCA retaliated against him because of his participation in a Securities and Exchange Commission probe into the company’s sales reporting and his decision to sell his FCA stock. The complaint portrays Bigland as a scapegoat for sales practices that were changed in July 2016, when the company admitted that a 75-month streak of year-over-year gains had actually ended 3 years earlier. Bigland’s lawsuit says he inherited a sales reporting system created in 1989. He has been head of U.S. sales since July 2011. He also has global responsibility for Ram and is CEO of FCA Canada. FCA agreed to pay $40 million as part of a settlement with the SEC for misleading investors about its monthly sales. The SEC said FCA was doing so “without admitting or denying” its findings. +++ 

+++ GENERAL MOTORS said it is temporarily laying off another 415 workers in Mexico as a strike by 48,000 U.S. hourly workers enters its 4th week. GM said it had partially idled its Ramos Arizpe propulsion plant, with the V8 engine line and the CVT transmission line not operating. The plant continues to build engines for the Ramos assembly plant, which is still operating, but GM previously laid off 6,000 workers in Mexico at a separate facility in Silao, Mexico. On Sunday, a United Auto Workers (UAW) official said the talks had taken a “turn for the worse”. Talks between the UAW and GM resumed Monday morning. +++ 

+++ LYNK & CO boss Alain Visser says only the 01 SUV model to be sold in Europe via the company’s novel subscription model. “In Europe we start next year”, Visser told. “At the end of the year we open our store in Amsterdam and that’s likely to be followed by Berlin and Gothenburg simultaneously. All markets will be done by the end of 2022”. The Volvo offshoot, headquartered in Gotheburg with cars built in China, is promising to do things differently, by avoiding traditional sales models. “We won’t have Lynk & Co dealers”, explained Visser. “We’ll have our own stores with a maximum of 2 stores per country. In addition we’ll have pop-up stores that just travel around. So we’ll have 3 distribution channels: online, flagship stores and pop-up stores. Our stores won’t be like Tesla with a display of cars. We’ll have lifestyle stores with a maximum of 1 car. It’s about building a lifestyle community where people can come at night to meet a new chef who might cook for the audience or meet a new fashion designer; everything that is lifestyle-orientated during the night. The stores will be open day and night”. As to where Lynk & Co will put its first store, London is a definite, according to Visser. “We don’t know where yet in London; we do have some ideas but we haven’t finalised a location. We’re looking at places like Soho”. Although Lynk & Co have revealed models 01, 02 and 03, with Visser confirming that he’s looking further ahead possibly with models 04 and 05, it’s the original 01 SUV that’s going to come to Europe. “We’ve only committed for 01 in Europe”, he said. “We don’t think we need a vast selection of a similar size, it may well be in the future, but we only have plans to launch in Europe with 01. And given our business model we think the fewer models we have the better. That business model means customers can subscribe to Lynk & Co with access to a car for as little as one month. “The fundamental difference with what we’re doing is that you can do it for one month”, said Visser. “You can do it for 12 or 24 months, but the minimum is one month. You take away the whole stress of committing to a car for the next 6 years of your life. You can get a brand new car for one month. Everything included”. The subscription also means you can access Lynk & Co cars in different locations, and make yours available to other subscribers when you’re not using it. Visser is also keen to stress the other subscription benefits, like access to special events and festivals. “Our target is to be a real lifestyle brand with an emotional attachment to the brand”, he said. Lynk & Co is already a success in China where customers are younger than average. “Our customers are very young. 50 % of our customers are under 35 and the average age of the 03 model is 28”, said Visser. “It’s the young, trendy, cool brand in China. It’s working, we’re growing at around 20 %”. “In 2018 we sold 120,000 cars and this year we’re heading close to doing 140,000 or 150,000”. +++ 

+++ NISSAN named the head of its Chinese business as its next chief, picking an executive known for close ties to top shareholder Renault and for a frank, straight-talking manner that has marked him as an outsider. By selecting senior vice president Makoto Uchida, Nissan’s board has gone with someone slightly at odds with its traditional corporate culture. He joined the automaker mid-career in 2003, unlike most top Japanese executives, who spend their entire working lives at one company. Known for his unflagging work ethic and relentless focus on cost control, Uchida was described by one long-time associate who spoke on condition of anonymity as a “foreigner with a Japanese face”: direct and to the point in conversations. He will be joined by newly appointed chief operating officer Ashwani Gupta, currently working for junior partner Mitsubishi, in trying to revive a business hit by plunging profits, management scandal and tensions with Renault. Japan’s second-largest automaker has been shaken by the arrest of former Chairman Carlos Ghosn last year on allegations of financial misconduct, which he denies, and the more recent departure of CEO Hiroto Saikawa after he admitted to being improperly overpaid. How the 58-year-old Uchida will turn the company around (particularly its business in the United States) and repair ties with Renault will now be a focus for investors. “Strong leadership is required”, Yasushi Kimura, Nissan’s chairman, told a news conference. “Group leadership, where they all support each other, will be more transparent”. One source close to Renault described the selection as “a victory for the alliance”, saying that both men knew the business and were ready to help Nissan recover. Before his ouster, Ghosn had been working on a plan for a full merger of Renault and Nissan, but had met resistance in Japan, which is concerned about French influence in the alliance. The French government is a major Renault shareholder. Relations were further strained this year when Renault held abortive merger talks with Fiat Chrysler Automobiles. Nissan’s former China chief Jun Seki, widely seen as one of the top contenders for the CEO job, will be vice chief operating officer, the company said. The new appointees will take up their positions by Jan. 1. The Uchida associate described him as a “Japanese person who isn’t really Japanese inside. Very direct in his language, to the point, easy to understand”. He is extremely proficient in English and worked with Renault, which owns 43.4 % of Nissan, on alliance procurement. Although he is steeped in cost control and rose through ranks in purchasing and procurement (2 key things for Nissan) there are other traits that mark him as an outsider. Unlike other top executives, he has not spent his entire career at Nissan, having joined from Nissho Iwai, now part of trading house Sojitz. He also graduated from Doshisha University in Kyoto, where he studied theology. Many top executives in Japan come from the University of Tokyo, and often study law. As such he is seen as a “tozama”, a lord who was considered an outsider in feudal Japan, the associate said. Directors at Nissan, including those from Renault, voted unanimously in favour of the 2 executives, a source familiar with the matter said. +++  

+++ The PEUGEOT brand will not have to pay fines on emissions for its European sales in 2020, its CEO said. “Our October production that will turn into registrations in January is already fully compliant with the average of 93 gram per kilometer of CO2 the Peugeot brand has to achieve next year”, brand CEO Jean-Philippe Imparato told. Imparato said paying fines is not an issue at Peugeot, which starting next year will check its average CO2 emissions against EU registrations every week. “We do not need to force self-registrations of high-emitting models by year-end because we are already aligning production with next year’s emissions needs”, he said. Analysts have warned that automakers could be hit with billions of euros in fines for missing the European Union’s fleet CO2 emissions reduction target, imposed to reduce the impact of climate change. The growing popularity of SUVs, which are less fuel efficient than hatchback or sedan equivalents, and bans on older diesels in some European cities are among factors hurting car companies’ ability to reduce emissions. In March 2018, PSA Group CEO Carlos Tavares said the French group would need electrified models (battery-driven cars such as the new Peugeot e-208 and plug-in hybrids) to account for 7 % of its sales while diesel would account for about 10 % to comply with the EU’s 2020 CO2 emissions target. Last month at the Frankfurt auto show, Tavares said that the decline of diesel is not as steep as he had feared 18 months ago, so he sees them accounting for 20 % to 25 % of PSA Group’s sales next year. Peugeot’s Imparato said the diesel share has declined by about 7 percentage points a year in the past 4 years: from about 60 % in 2015 to about 34 % so far this year. But he declined to say where he sees it going next year. “I have ordered a certain mix of diesels”, he said, “but I am not going to make it public”. Peugeot had planned to build about 10 % of its new 208 with battery power, but early demand for the EV (called the e-208) suggests that figure may be much higher, the French automaker’s CEO said. “Of the 40,000 qualified leads we received, half were for the e-208. A quarter of the pre-orders we got are for the e-208”, Jean-Philippe Imparato told. Imparato admitted that it is too soon to say whether e-208 volume would be much higher than what the company had initially planned or whether this higher mix comes just from the high percentage of early adopters that normally choose new technologies. “My work is based on facts”, he said, “and the only fact right now is that we can take the e-208 up to 20 % of the new 208’s production of about 300,000 units a year”. At its current planned 10 % of overall 208 sales, Peugeot will make money on the e-208, Imparato said. Consequently, he does not need to force the full-electric car’s volume to a higher percentage of the range’s total to break even. To lure customers to the e-208, Peugeot is focusing on the car’s total cost of ownership, which the company says is on par with a 130 hp 1.2-liter 208 gasoline version equipped with an 8-speed automatic transmission. On average, with a €3,500 deposit, an e-208 will cost less than €400 a month across Europe, the same as a gasoline model, Peugeot said. “One advantage of the e-208 is that residual-value specialists tell us it has a residual value €2,000 higher than a gasoline model”, Imparato said. +++ 

+++ Automobili PININFARINA ‘s new sales chief, Jochen Rudat, brings nearly 10 years of experience working with Tesla with him to the EV startup. Rudat joined the company this month. He and his team will be in charge of marketing the company’s growing lineup. Rudat most recently was Tesla’s director for central Europe. Prior to joining Tesla he spent several years as a dealer development manager at BMW Group Switzerland. Automobili Pininfarina is a fully owned subsidiary of the Indian conglomerate Mahindra, which also owns the Turin-based design house Pininfarina. Munich-based Automobili Pininfarina is looking to follow up its Battisa with a range of vehicles that could include a sedan and an SUV. In September, Automobili Pininfarina said it will develop a platform for high-performance electric vehicles in collaboration with its 2 new strategic partners from Germany, Bosch Engineering and Benteler. +++ 

+++ Newly indepenedent performance brand POLESTAR has announced a chassis upgrade package for its electric fastback, the 2. The Performance Pack adds €6.000 to the list price of the standard model, which will first be offered in a fully loaded Launch Edition, costing from €59,800 in The Netherlands. Included is a range of modifications aimed at enhancing the car’s dynamic appeal, in the same vein as Polestar Engineered versions of models from parent company Volvo. The 2’s front brakes gain four-piston Brembo calipers, while both axles receive adjustable Öhlins dampers and 20 inch forged alloy wheels over the standard 19 inch set. Added visual differences come courtesy of gold seatbelts, brakes and valve caps. Joakim Rydholm, chassis development chief at Polestar, said: “We spent a lot of time obsessing over the finest details of the Performance Pack chassis setup to find the car’s sweet spot; we call it the ‘Golden Ride’. Comfortable but focused, we want you to feel positively connected to the road, the car alive and communicative but balanced and predictable. It really is unlike most electric cars. It feels Polestar”. The 2’s 408 hp twin-motor powertrain goes unmodified, meaning the Performance variant is still expected to offer 500 kilometres of range and a sub-5.0 seconds 0-100 kph time. An entry-level version is expected to follow, priced from around €42,000 in The Netherlands, to strengthen the 2’s position against the Tesla Model 3. +++ 

+++ The next generation of SMART cars must take inspiration from the look of the first relaunched Minis, according to Mercedes head of design Gorden Wagener. Earlier this year parent company Mercedes-Benz sold a half-share in Smart to Geely, owner of Volvo, with the pair entering into a joint venture to run the city car firm, manufacturing electric cars only from a production base in China. The first cars built as part of the deal will be launched in 2022, with successors to the Fortwo and Forfour planned, plus a move up in size to launch a B-segment car. Mercedes will lead the design and styling of those future models, with Geely leading the engineering. “The key point is that sexiness sells and in that regard I look to those first Minis for inspiration”, said Wagener. “There was a simplicity, a voluptuousness that gave them unique appeal, and the challenge is to get those kind of shapes without growing the car too far or making it look too heavy. We are just at the start of the process now with Geely, but we know what direction we want to go in. Smart has grown up as a brand, it is no longer a child, and it can be justified in going in a sexier, sportier direction with its styling”. Until the new models launch in 2022, current Smart cars will continue to be made at Daimler’s plants at Hambach in France and Novo Mesto in Slovenia. Facelifted Fortwo and Fourfour models were revealed at the Frankfurt motor show, and will be sold from next year as electric-only models. +++ 

+++ The German electric van maker STREETSCOOTER has recruited executives from Tesla and Ford to help drive its international expansion. Peter Bardenfleth-Hansen, who was part of Tesla’s first European Tesla team, and Ulrich Stuhec, join the Streetscooter, have joined the company said in a news release. Streetscooter is a subsidiary of the German postal company Deutsche Post. Bardenfleth-Hansen will be chief growth officer and will be responsible for building up StreetScooter’s international sales organization. Stuhec will be chief technical officer. He will be responsible for product development, and a new platform and technology development, including autonomous driving. Stuhec worked for Ford for 17 years and had a leading global role developing Ford’s autonomous and electric vehicle technologies. He also worked for BMW and Rover Group before joining Ford. The executive will also be responsible for the China expansion of StreetScooter. Fabian Schmitt, the current technical chief, will take on a new role in the company. In September, Streetscooter said it had signed a memorandum of understanding with Chery Holding Group to begin producing electric vans in China starting in 2021. Chery will invest up to €500 million and plans annual production capacity in China of up to 100,000 vehicles. Ford started production of an electric van in Germany last year using technology provided by StreetScooter. The StreetScooter Work XL is based on Ford’s large Transit van and is equipped with a drivetrain and body designed with the help of StreetScooter. StreetScooter is expanding its activities despite a projected loss and a search by Deutsche Post for outside companies willing to invest or take over the unit. StreetScooter will make a double digit million euros loss this year, Deutsche Post CEO Frank Appel told. “We are in talks with potential partners and buyers”, Appel told in an interview. He said in the long run Deutsche Post wants to focus on its core business and does not want to own the electric delivery van unit. +++ 

+++ The rapid expansion of VOLKSWAGEN ’s new electric ID range will ramp up in 2020 with the launch of 2 SUV-based models, both of which will be offered exclusively in China. The country will play a key role in VW’s ambitious goal to sell one million ID-branded electric cars per year by 2023. Stephan Wöllenstein, VW’s China boss, said the country is “the driving force” behind the firm’s electric offensive, which began with the launch of the ID.3 hatch at the recent Frankfurt motor show. In fact, the success of VW’s heavy investment in full-electric technology is likely to depend on the country, and China poses several major challenges. About half of VW’s 6.2 million car sales were in China. With Chinese government incentives heavily pushing electric vehicles, it is also the world’s largest electric car market, with 1.2 million EVs sold there last year. VW wants to produce 22 million electrified cars by 2028, with more than half of those in China. This will involve electrified versions of existing VW models, followed by a range of ID models based on the VW Group’s electric MEB platform. As with VW’s current range, ID models in China will be offered through the firm’s Beijing-based import business and its 3 joint ventures: the long-established FAW-Volkswagen and SAIC-Volkswagen, and the new JAC-Volkswagen. All 3 are building plants purely to make MEB-platformed cars, with the FAW and SAIC factories due to open next year, each with capacity for 300,000 cars annually. “That is not everything we will do capacity-wise, but it will allow us to serve the market as it is growing towards really big numbers”, said Wöllenstein. FAW-VW and SAIC-VW will each launch its own ID model next year, likely similar-sized cars with different external styling, as VW has done with its recent SUV range. Wöllenstein likened the joint-venture partners to “a big family with 2 kids. You don’t always have to dress them the same, but you can’t give one double the toys of the other without creating jealousy”. Wöllenstein said the first ID models in China will be SUV-based. That’s likely to mean local-market versions of the ID.4 SUV (launched in concept form as the ID Crozz) previewed at the Frankfurt show, or the larger ID Roomzz. “We are going to introduce the ID.3 in China with local production, but it will not be the first one”, said Wöllenstein. “The first models will be more in line with what Chinese customers love, which is SUVs and sedans. We will likely start with an SUV-type car before we come in with sedan models and then the ID.3”. According to reports in China, SAIC-VW is working on 3 MEB models, including local versions of the Roomzz and one based on the Skoda Vision iV concept. Although the Chinese market represents a huge opportunity for VW (and other global car firms), it also presents unique challenges. The incentives the Chinese government has offered for producing electric cars has led to a huge EV market, with hundreds of start-up companies competing with large Chinese firms that already have proven products on sale. Wöllenstein likened the push towards EVs in China as “a bit of a gold rush” but noted that the market includes “some very serious competitors with rich experience, such as BYD, which produces more electrified cars than anyone else”. He added: “I’m pretty sure not all of the start-ups will succeed but they will have an impact on us. They will change expectation and perception from consumers on what an electric car should be”. Asked whether VW is playing catch-up in the Chinese EV market, Wöllenstein said: “Traditionally, VW is not always a pioneer, but when we go in with a well-thought-through idea, we have shown we are able to win customers. Maybe some of our competitors are not happy that we go in with such full throttle commitment”. But there is a question over how many customers can be won over. After years of massive growth, the Chinese car market has now slipped into decline, and the sales slump has started to impact on electric cars. Wöllenstein admitted that any downturn is a “short-term concern”, but added: “The long-term perspective is still towards 27 to 30 million cars annually. We are seeing our product offensive in China paying off and we’re actually gaining market share. We may be a bit lower on volume, but in difficult times, customers tend to go for the safe choice, and Volkswagen is a long-established safe choice in China”. +++

+++ VOLVO ’s rapid shift toward electrification put thousands of employees working on the automaker’s current range of internal combustion engines and hybrid powertrains at risk. To preserve those jobs while still charging at full speed toward a battery-propelled future, Volvo plans to merge its powertrain operations with those of parent Zhejiang Geely Holding Group. CEO Håkan Samuelsson explained the benefits of the move in an interview. What message do you want the news of this planned merger to convey? “That Volvo has taken another decisive step toward electrification by adjusting its business structure accordingly. Secondly, because half of our cars will be hybrids we are securing the necessary resources to further develop gasoline engines to make them excellent hybrids. We are also securing this supply at a better cost because we are combining the volumes of Volvo and Geely. We already have a combined 2 million car sales today and that will continue to grow rapidly in the future”. How much will this move save Volvo? “We haven’t quantified the saving, but it will be huge. We are at least doubling the Volvo volume and that alone results in a significant cost savings. What might be even more important is that we are safeguarding our development resources”. How so? “Our development engineers would have been at risk of having their budgets squeezed if we were to do this alone. We would need to prioritize electrification, which means it’s likely they would not have gotten the resources they need to maintain their high level of competency. With this change we avoid this. We will continue to have very exciting r&d jobs for our team”. Do you need to reconfigure your powertrain network or can plants such as your factory in Skovde, Sweden, also produce full-electric powertrains? “No, I would say that Skovde should continue building combustion engines that we can use in hybrid cars. I don’t see it as an alternative for our combustion engine factories to try to build electric engines. It’s a very different competence. It’s much more honest and credible to say, “Guys, we need the combustion engine so let’s combine it with Geely so we can have higher volumes and more resources to do the job”. How are the powertrains from Volvo and Geely being used currently? “The Geely side has one powertrain unit that supplies their brands, but Lynk & Co, for example, already takes more Volvo engines than Geely engines. We have 2 powerful powertrain units so the intention is to bring them together into one common supplier for Lotus, Lynk & Co, and so on. What’s also very importantly is that this unit is competitive. The best way to ensure you are competitive is to supply to third parties. We want to do that as well”. Why make this change now? “We believe we have an advantage by doing this very fundamental restructuring very early because the market for combustion engines will not grow in the future. We are doing exactly the right thing, which is utilizing synergies. That’s what you do when you are dealing with a shrinking market”. Will Volvo be the Geely Group’s center of competence for full-electric powertrains? “In a way, yes. Our role is definitely the electrification of the platform for our 60- and 90-series cars. If Geely wants advanced premium cars of that size, that’s the platform to use”. Will this new powertrain unit be listed? “It’s too early to say. Right now we are defining Volvo’s stand-alone combustion engine organization, which will have its own financial steering. The next step would be to bring the pieces together into one unit”. +++

Reageren is niet mogelijk.