Newsflash: Tesla Model 3 na Golf en Clio populairste auto van Europa


+++ 4 people who work at supplier Webasto in southern Germany have been infected with the CORONA VIRUS , and one of them contracted it from a colleague visiting their workplace in China, officials said. In one of the first cases of person-to-person transmission outside China, a Webasto employee apparently contracted the virus on January 21 during a training session with a Chinese colleague, Bavaria’s health ministry said. “A total of around 40 employees at the company have been identified as potential close contacts. As a precaution, the people concerned are to be tested on Wednesday”, Bavaria’s health minister Melanie Huml said in a statement. Webasto said in a statement that it is closing its headquarters in Stockdorf, Bavaria, until Sunday due to the virus outbreak. Employees have been offered the choice of working from home and the supplier has asked its employees not to travel both inside and outside Germany for the time being. An employee at the supplier’s headquarters had become infected after attending a training session hosted by the Chinese colleague earlier his month. The Chinese employee from Shanghai tested positive for the virus upon returning to China. The 3 other Stockdorf employees infected worked closely with their German colleague, health officials said. All 4 German patients are being monitored in an isolation unit in Munich. The cases raise concerns about the spread of the flu-like virus that broke out in the central Chinese city of Wuhan at the end of last year and has killed 106 people and infected more than 2.800 people. It spreads in droplets from coughs and sneezes and has an incubation period of up to 14 days. Confirmation of any sustained human-to-human spread of the virus outside of China, as well as any documented deaths, would bolster the case for reconvening the World Health Organization’s Emergency Committee to consider again whether to declare a public health emergency of international concern. The independent panel last week twice declined to declare an international emergency. Outside of China there have now been 45 confirmed cases in 13 countries, with no deaths so far, the WHO’s spokesman Christian Lindmeier told a briefing in Geneva on Tuesday. The WHO said a case in Vietnam involved human-to-human transmission outside China and a Japanese official has said there was a suspected case of human-to-human transmission there too. Andreas Zapf, president of Bavaria’s office for health and food safety, said on Tuesday the 33-year-old man lives in the district of Landsberg about 50 km west of Munich and had come into contact with a Chinese colleague on January 21. Zapf said the Chinese woman was from Shanghai but her parents, who are from the Wuhan region, had visited her a few days earlier. He added that she had arrived in Germany on January 19, appearing not to have any symptoms, but began to feel ill on her flight home. She sought medical treatment after landing and tested positive for coronavirus. When that information was relayed back to the German company, a male employee said he felt like he had flu over the weekend and was on Monday advised to get medical treatment. The head doctor at the clinic where the man is being treated told a news conference the patient was awake and responsive, and he did not think the man’s life was at risk. Health Minister Jens Spahn said the risk to people’s health in Germany from the coronavirus remained low. The chief executive of Robert Bosch, the world’s biggest auto components supplier, warned that coronavirus could impact its global supply chain, which is heavily dependent on China. “We are naturally concerned, but on the basis of the facts today, we have no disruption to our business or supply chain”, chief executive Volkmar Denner said at a meeting with journalists. Bosch is relying on China as a global manufacturing base for exporting electric motors, transmission and power electronics for electric cars. “We need to wait to see how things develop. If this situation continues, supply chains will be disrupted. There are forecasts that predict the peak for infections will drag on until February or March”, Denner said. “In Wuhan Bosch has two plants making steering systems and thermotechnologies, with around 800 employees. There have been no reports of infections”, Denner said. Bosch’s China plants have been shut for Chinese new year and the holiday has been extended to February 3, an extension which will not disrupt Bosch’s global business, Denner explained. Bosch has been in China since 1909 and has 23 automotive manufacturing facilities in more than 60 locations in the world’s largest auto market, which is home to the largest Bosch workforce outside of Germany. Bosch employs 403.000 people globally. Bosch makes multimedia infotainment systems in Wuhu, brake booster systems in Nanjing, automotive electronics for use in connected and automated driving in Wujin, 48 volt battery systems in Wuxi and builds electric vehicle motors, transmissions, and power electronics in Taicang. Bosch sales in Asia Pacific reached €22.5 billion last year, of which more than €10 billion came from China. Bosch expects global automotive production to fall 2.6 % to 89 million cars in 2020 due to a decline in demand in China, the United States and Europe. Renault will resume production at the factory it runs with Dongfeng Group in Wuhan, Hubei province and the epicenter of the outbreak of the corona virus, on February 10, a spokeswoman for the French carmaker said. The reopening of the plant will be 8 days after the end of the extended Lunar New Year holiday in China, the world’s top car market. Beijing added 3 days to the week-long holiday, which will now last until February 2 as it seeks to limit the spread of the corona virus, which has infected thousands and killed more than 100. Skoda has postponed business travel to its largest market China for an indefinite period due to the spread of a new corona virus but is not planning any staff evacuations, it said. Fears over the flu-like virus are growing as the death toll rose to 132 and countries warned their citizens over travel to China. The Czech Foreign Ministry recommended people only travel to China if it is absolutely necessary. Toyota’s production plants in China will stay closed through February 9, the Japanese automaker said in response to the spread of a new coronavirus following a sharp rise in fatalities. Toyota, which runs plants in regions such as the northern city of Tianjin and the southern province of Guangdong, said the closures after the Lunar New Year holidays were in line with transport lockdowns in some places, and as it assesses its parts supply situation. +++ 

+++ As usual, the Volkswagen Golf and Renault Clio were the bestselling models in EUROPE in December. But there was a big surprise at No. 3: The Tesla Model 3, which has quickly become the bestselling electric car in Europe in its first year on the market. Tesla sold 22.041 Model 3s in Europe in in December. Just 7.912 Model 3s were sold in November. The model went on sale in Europe in 2019, with vehicles exported from the United States. Tesla has announced plans to build a factory to serve Europe near Berlin. Electric vehicles took an 11 % market share in the month, the highest ever in Europe. The Model 3 was followed by another unexpected winner, the Ford Kuga as crossovers and SUVs took their highest market share in Europe, at 42 %. Matthias Schmidt, an independent automotive analyst in Germany, attributed much of the Model 3’s surge to demand from the Netherlands, where company car taxes for electric vehicles increased on January 1 to 8 % on cars under €45.000 from 4 % on cars under €50,000. Tesla sold 12.053 Model 3s in December in the Netherlands. In addition to the Dutch company car tax increase, the shakeup in the sales leaderboard was largely due to other “artificial” conditions, according to analysts. Europe’s new-car market showed big growth in December, with registrations up 21 % year-on-year to 1.26 million. Facing a new CO2 emissions fleet average of 95 grams per km for 2020, many automakers sought to register as many higher-polluting models as possible before January 1. That sales push included self-registrations. “The growth is most likely due to self-registrations from those hoping to resell the units as second hand in 2020”, said analyst Felipe Munoz. He cited Spain as an example, where total registrations increased by 6 %, but business registrations increased by 23 % and private ones fell by 7 %. “The December registrations are an indication of the ongoing regulatory challenges facing carmakers in the year ahead”, Munoz said, noting that overall CO2 emissions rose in the 4th quarter of 2019. December’s sharp increase was not unexpected. Peugeot CEO Jean-Philippe Imparato told last fall that he thought December would be a record-breaking month. The gain was also magnified by a decline in the 4th quarter of 2018, industry group ACEA said last week, as some automakers pulled uncertified models off the market after the WLTP deadline. With the unusual market conditions as a backdrop, some models recorded large gains. Ford Kuga sales were up 127 % to 22.045 for the month, with a redesign that Ford described as “friendlier” new to the market. In fifth place, the Dacia Duster was up 59 % to 20.933 sales. Other big gainers among the top 25 bestsellers were the Nissan Qashqai (up 47 % to 19.726 in 7th place), the BMW 3 series (up 127 % at No. 20), the Suzuki Vitara (up 133 % at No. 22) and the Smart ForTwo (up 174 % at No. 23). Electrified vehicles recorded big gains across the hybrid, plug-in hybrid and full electric categories. The new Toyota Corolla led among hybrids, whose sales increased by 41 % for the month, and plug-in hybrid sales were up by 80 %, led by the BMW 3 series. The Tesla Model 3 represented 43 % of battery-electric vehicles. “Tesla continues to have an enormous impact on registrations at the end of each quarter and the Model 3 has put sedans back in the spotlight”, Munoz said. “The question is whether this trend is sustainable, or will electric SUVs hinder the popularity of Tesla Model 3 in the coming months?” +++ 

+++ FORD will settle a class-action lawsuit with almost 2 million owners and former owners of Focus and Fiesta models outfitted with its troubled PowerShift dual-clutch transmission. The class-action lawsuit, first filed in 2012, shed additional light on the issue and last year, it was revealed that the American car manufacturer knowingly launched the 2012-2016 Focus and 2011-2016 Fiesta models with defective transmissions. The proposed agreement includes a guaranteed commitment from Ford of $30 million in cash reimbursement to consumers with a record of multiple failed transmission repairs within 5 years of buying their cars or 100.000 km. Additionally, Ford will need to simplify a buyback program for defective vehicles and establish an easier process for former owners and people who’ve leased defective cars to be compensated. Lawyer Tarek Zohdy of Capstone Law in Los Angeles who helped broker the deal said the Ford payout could exceed $100 million. “There’s no cap. The truth is, Ford is going to have to pay out claims until they’re exhausted”, he said. In my opinion, Ford will have to deal with these vehicles until people are done filing their claims. This settlement is entirely reliant on the consumers’ decision to file a claim. It’s up to the consumer whether they want to let Ford keep their money. They created a defective transmission and I wanted to help people get their money back”. In a statement, Ford spokesman T.R. Reid said “Ford believes the settlement is fair and reasonable and we anticipate it will be approved by the court following the hearing next month”. During recent court proceedings, Ford revealed that between October 2017 and the end of 2019, it had bought back 2.666 vehicles for $47.5 million. +++

+++ Following its debut in South Korea, GENESIS has introduced the GV80 in the United States. Looking virtually identical to its KDM counterpart, the US-spec model resembles a baby Bentley Bentayga and will go on sale this summer. In the United States, 2 engines will be available.  The company didn’t go into specifics, but confirmed choices will include a turbocharged 2.5-liter 4-cylinder with 304 hp and a twin-turbo 3.5-liter with 375+ hp. While Genesis needs the GV80 to be a success, the company didn’t say much else about the SUV.  However, they confirmed it will be offered with second-row heated, ventilated and power reclining seats as well as Remote Smart Park Assist. The latter is also available on the Hyundai Sonata, so you can tell your friends your luxury crossover has “Smaht Pahk”. Despite the lack of details, the US-spec GV80 should have a 14.5-inch infotainment system, handwriting recognition technology and augmented reality navigation.  We can also expect advanced noise cancellation technology, an air purification system and an assortment of driver assistance systems. The latter will likely include Smart Cruise Control with Machine Learning, Forward Collision-Avoidance Assist, Blind-Spot Collision Avoidance Assist and Rear Cross-Traffic Collision-Avoidance Assist. Of course, the million dollar question is pricing. Genesis models typically offer pretty good bang for the buck, but there’s no word on how much the model will cost or how nicely it will come equipped. +++ 

+++ GLOBAL AUTOMOTIVE PRODUCTION may have peaked, auto supplier Robert Bosch said, announcing job cuts and a review of its business to cope with a 44 % drop in full-year operating profit and a downturn in demand for cars. Global automotive production is expected to fall for the third consecutive year, by 2.6 % to 89 million vehicles in 2020, following a drop in demand in China, Europe and the United States, the Stuttgart-based car parts supplier said. “It could well be that we have passed the peak of automotive production”, Bosch CEO Volkmar Denner said. He also said he assumed the low level would remain constant and did not expected an increase in global automotive production before 2025, while the market would shrink by 10 million units in 2020 compared with 2017. Bosch said its full-year earnings before interest and taxes fell to €3 billion in 2019; a 44 % drop from the €5.4 billion in the year-earlier period and its profit margin contracted to 4 % from 7 % because of lower demand in China and India. Total revenue was stable last year, at €77.9 billion, as Bosch benefited from increased complexity in vehicles, which allowed it to sell more components and systems per vehicle produced. A shift to electric cars is expected to create opportunities longer term, but will impact jobs in the near term, Denner said. 10 workers are needed to make a diesel injection system, 3 for a gasoline system and 1 to produce an electric motor, he said. As a result, Bosch has said staff adjustments will be made where necessary, including shorter working hours, voluntary redundancy and severance packages, although Bosch declined to provide a global figure for headcount reductions. Already last year, Bosch reduced its headcount by 6.800 to 402.800, with 2.000 jobs cut in Germany and 3.600 positions reduced in Asia Pacific. Bosch hopes to exceed €1 billion in sales from electric car components this year, and has set aside €500 million for investments in electromobility for 2020, Denner said. Bosch will also start production of long-range Lidar, a new sensor category, and begin production of hydrogen fuel cells in 2022. +++ 

+++ This is a huge week for radical new models. In volume terms, the biggest new car is probably the Seat LEON . Seat was still something of a VW Group basket case before the third generation of the Leon arrived in 2012. It stitched together lots of the same chassis and engines as the likes of the Volkswagen Golf and the Skoda Octavia in a package which had, well, just a little bit more Latin flair than the German and Czech offerings. The result was a smash hit. Well over a million Mk3 Leons have been shifted over the past 7 years. Seat’s designers and engineers have done the logical thing and addressed the key issues of the outgoing model: namely, a few dodgy materials in its cabin and fairly cramped rear-seat accommodation. Is the new model’s overall shape as rakish as that of the car it replaces? Perhaps not quite. But it now offers much the same interior space as a Golf and pretty much the same tech in a good-looking body with prices that will almost inevitably be slightly keener. In lots of ways, in fact, the new Leon reeks of the influence of Luca de Meo, the sales and marketing specialist whose razor-sharp focus on delivering products that customers actually want has transformed the Spanish manufacturer’s fortunes in recent years. And it makes us wonder how big a blow de Meo’s recent decision to step away from Seat (who is now pursuing a career at the helm of Renault) will be for everyone in Barcelona. The new Leon looks set to provide further evidence of how far Seat has come. And leave us doubly curious about what the company does next. +++


+++ Electric pickup start-up LORDSTOWN MOTORS is pursuing a $200 million loan from a U.S. Energy Department program to retool a former General Motors factory in northeast Ohio, Chief Executive Steve Burns told. Burns met with Energy Secretary Dan Brouillette for about 1 hour and the company was holding additional talks with officials from the Energy Department’s Loan Program Office. “We think we are worthy of government help. We don’t want a handout: we want a loan”, Burns told. “It’s just going to be more jobs faster if we get it. We are viable without it”. Burns disclosed the company plans to unveil a drivable version of its electric truck at the Detroit auto show in June. It hopes to begin production by year-end. The Energy Department declined comment. Burns said the company hopes to receive funding from the Energy Department’s Advanced Technology Vehicles Manufacturing program that in 2009 awarded loans to Ford, Tesla and Nissan to retool factories, but has not issued loans since 2011. Nissan and Tesla previously repaid their loans. The fate of the sprawling plant became a political lightning rod after GM announced its planned closure in November 2018, drawing condemnation from U.S. president Donald Trump and many U.S. lawmakers. A bipartisan group of Ohio lawmakers wrote Brouillette last week offering “strong support” for the loan, saying northeast Ohio was dealt a “severe blow” by the plant closing. Lordstown Motors bought the plant and equipment for $20 million as part of its ambitious plan to begin building electric pickup trucks by the end of 2020. “It’s cool to bring something back to life”, Burns said. The company is working to raise additional funding and is in advanced talks with a large strategic investor, Burns said. GM last year agreed to loan Lordstown Motors $40 million to acquire and retool the plant. Burns hopes to repay GM’s loan “in a few weeks”. Burns plans to start crash-testing vehicles in July, hiring about 400 hourly workers in September and to begin production in November or December. Electric vehicle startup Rivian, backed by and Ford, plans to build an electric pickup and companion starting in late 2020. GM plans to build its first electric pickup starting in late 2021. Tesla plans to start building its electric Cybertruck in late 2021. +++


+++ NISSAN takes an ax to the house that Ghosn built with new cost-cutting measures. It is planning aggressive cost cuts to deal with an unexpected slump in sales as the expansionist strategy it inherited from fugitive former chairman Carlos Ghosn flounders, 4 people familiar with the plans said. Japan’s second biggest carmaker is set to eliminate at least 4.300 white-collar jobs and shut 2 manufacturing sites as part of broader plans to add at least 480 billion yen ($4.4 billion) to its bottom line by 2023. The moves come on top of a turnaround plan unveiled in July and are likely to include cutting Nissan’s range of cars and the array of product options and trims in each line, slashing jobs mostly at head offices in the United States and Europe, and reducing advertising and marketing budgets, they said. “The situation is dire. It’s do or die”, a person close to Nissan’s senior management and the company’s board told. Most of the planned cuts and measures to enhance efficiency were presented to Nissan’s board in November and received its general blessing. Under Ghosn, Nissan embarked on a global expansion, boosting capacity to add new models, driving more decidedly into markets such as India, Russia, South Africa and southeast Asia and spending heavily on promotions and marketing to hit targets. Now, many of those models are missing sales goals and executives at Nissan’s Yokohama headquarters estimate up to 40 % of its global manufacturing capacity is unused, or under-used. Some executives are worried Nissan, part of an alliance with Renault and Mitsubishi, could post another loss at its carmaking business in the last quarter of the 2019/2020 fiscal year, and possibly for all its operations in this period ending in March. 1 source said that would most likely hinge on whether Nissan books big restructuring expenses in its current financial year, or waits until the year ending in March 2021. In July, Nissan said it would cut 12.500 jobs from 14 sites around the world (from the United Kingdom to Spain, Mexico, Japan, India and Indonesia) and reduce its model range by 10 %. At the time, Nissan officials told that meant shutting 1 production line at each plant. Now, Nissan is considering shutting 2 plants permanently, on top of the reductions at the 14 other sites, people close to Nissan’s management and board with knowledge of the matter told. They didn’t say which 2 new sites were at risk. People familiar with the plans said the axe was also likely to fall at Nissan’s North American head office in Tennessee and its European headquarters in Geneva, as they were bloated with high-spending sales and marketing staff. 1 source with direct knowledge of the turnaround plan said Nissan’s marketing teams globally gobble up nearly 1 trillion yen a year, or about 45 % of Nissan’s annual fixed costs of 2.1 trillion. Nissan had been saddled with the excess, “thanks to Ghosn’s highly aggressive, expansionist volume goals, which we failed to achieve”, the source said. Ghosn told a news conference in Beirut on January 8 that Nissan’s poor performance since 2017 was down to Hiroto Saikawa, who formally took over from him as Nissan CEO in April 2017. “He was CEO and he was responsible for it”, Ghosn said. In addition to cuts in Nissan’s fixed costs, managers are also considering plans to kill off unprofitable models, accelerate the pace of new product development and reduce the average age of its line-up to 2,5 years from 5 years now. The new plans aim to add 480 billion yen to Nissan’s bottom line by the end of March 2023, with 300 billion from cuts in fixed costs and 180 billion from an array of cars to be launched in the next 3 years. Nissan is aiming to achieve an operating margin of 6 % on revenue of 14.5 trillion yen by March 2023, compared with 3 % from 13.0 trillion forecast for the year ending in March 2020, according to plans announced in July. But since July, Nissan’s operating performance has worsened by more than expected, making it likely its new management team will have to find savings significantly above the 480 billion yen currently envisaged to hit its targets, three sources said. To be sure, Nissan has plenty of cash in its coffers to cope with setbacks. According to quarterly results, it had 1.14 trillion yen in net cash at the end of September. Still, sources said Nissan was no longer adding freshly generated cash to its war chest, mainly because of its high fixed costs and the sales slide. Furthermore, it has expensive car launches in the next few years that could eat into reserves. “Even if we had 1 trillion yen in cash, that could be depleted in no time if we didn’t pay attention”, a person close to Nissan management told. 3 of the people said the collapse in Nissan sales around the world was a major factor in forcing the company to consider restructuring above and beyond the measures outlined in July. They said Nissan’s global sales would likely fall toward 5 million vehicles, or slightly above, way short of its sales goal of 5.5 million for its current financial year. The worse-than-expected downturn, which has forced Nissan to spend more on promotions to cushion the fallout, has created additional urgency to take more drastic steps, sources said. Of particular concern is the U.S. market, where sales fell 10 % in 2019, and the continued sluggishness of the Chinese market, which left Nissan’s sales volumes down 1.1 % from 2018. One especially troublesome issue for Nissan has been its sales efficiency. In 2018, it had 69 models and sold 5.2 million vehicles (or 75.000 on average per model line) and it was planning to expand its line-up to 73 by the end of 2022. Now, it is aiming to cut its range to 62 and boost average sales per line to 87.000; the equivalent of Toyota’s average last year, according to calculations and forecasts by the team formulating Nissan’s recovery plan. “We thought by now we would be selling 6 million cars a year. But the truth of the matter is our selling ability is about just north of 5 million”, one source said. People familiar with Nissan’s internal discussions said there was even some concern the new measures being considered, known as “Phase Two” cuts, might not be enough to achieve its 3 year turnaround goals if sales don’t recover fast enough. “Those Phase Two measures will most likely fall short”, said 1 person familiar with restructuring plans, making a point echoed by several people close to the management team and board. To make matters worse, the restructuring efforts have been disrupted by the political turmoil following Ghosn’s departure in 2018, his flight from Japan in December and subsequent accusations against former colleagues at Nissan. According to 5 sources, the upheaval rattled Nissan’s top management team so much that it paralyzed their ability to execute many of the planned restructuring moves smoothly. The latest turmoil lasted from December to mid-January, when the board curbed the influence of “anti-alliance” forces sabotaging the plans, 2 sources said, declining to elaborate. Nissan’s new CEO Makoto Uchida took the reins at the start of December with Ashwani Gupta, who has worked at Mitsubishi, Nissan and Renault, as chief operating officer. “Whoever the action was aimed at, the upshot is that Gupta is now completely freed from pressures from those anti-alliance forces to carry out all the planned turnaround measures”, one of the people said. “He should do so without hesitation as the board has cleared the way”. Nissan is offering voluntary separation packages to many of its U.S. workers as it tries to resize itself to match lower sales. The Japanese automaker wouldn’t say how many employees it is targeting to leave, how much money it expects to save, or give details of the severance offers. The offers are being made to factory and white-collar workers over the age of 52. Nissan’s U.S. sales were down almost 10 % last year, with the main brand down 8.7 % and Infiniti off 21.1 %. Many analysts expect total U.S. auto sales to drop this year. “To adapt to current business needs and improve efficiencies, Nissan will offer voluntary separation packages to eligible U.S.-based employees”, the company said. Company spokeswoman Lloryn Love-Carter said although she couldn’t give a specific number of workers the company is seeking to cut, it would not be in the thousands. She said the offers will be in the U.S. only. Earlier in January, Nissan made its U.S. employees take 2 unpaid furlough days. The company has more than 20.000 U.S. workers, concentrated mainly at its U.S. headquarters in Franklin, Tennessee, at factory complexes in Canton, Mississippi, and Smyrna, Tennessee, and a technical center in Farmington Hills, Michigan. Eligible workers will be notified and would leave later in the year. Not all applications will be approved, Love-Carter said. Nissan also said it would cut 2 sales regions and reduce the frequency of its sales reports to quarterly from monthly, following the lead of Detroit automakers. +++

+++ RENAULT has named Luca de Meo, the former head of Volkswagen’s Seat brand, as its next chief executive, as the carmaker looks to draw a line under a year of turmoil by finalising a long-awaited management shake-up. De Meo’s appointment fills one of the big gaps left at the French company after it cleared the decks following the 2018 arrest in Tokyo of former boss Carlos Ghosn, and as it seeks to reset its strained alliance with Nissan. Ghosn, who forged and oversaw the Renault-Nissan partnership for almost 2 decades, has since fled Japan to Lebanon, from where he has contested the financial misconduct charges against him and said the partnership was at risk of collapse. De Meo will start on July 1, Renault said in a statement. Clotilde Delbos, the carmaker’s finance chief who has been interim CEO since former Ghosn ally Thierry Bolloré was ousted last October, will then become deputy CEO. Italian-born De Meo had been hotly tipped for the job, but faced hurdles because of a non-compete clause in his VW contract. De Meo will have his work cut out to turn around the firm. He will take the reins under Renault chairman Jean-Dominique Senard, brought in last January from tyre maker Michelin, and who has so far emerged as the de facto senior figure in the Renault-Nissan alliance. Like rivals, Renault is grappling with a downturn in demand, and has said it expects a slight decline in the car market in Europe, Russia and China this year. The firm has also presented 2020 as a make-or-break year for the alliance with Nissan and is under pressure to deliver on cost savings and joint industrial projects. Automakers face pressure to meet stringent new emissions targets with less polluting models, and are also competing to produce innovations such as self-driving cars, which require large investments. De Meo, who speaks French, will be one of a growing handful of outsiders in senior company jobs in France. The 52 year old started his career at Renault and has worked at Fiat (where he was one of the managers who helped launch the Fiat 500 model along late boss Sergio Marchionne) and Audi among other brands. De Meo is credited with revitalising sales at Barcelona-based Seat, imbuing it with a more sporty image and accelerating projects that were already in the works. His portfolio will be markedly larger at Renault, however, whose brands include Dacia and Lada. De Meo faces a list of tasks ahead that will be far more complex than those he faced at Seat, Volkswagen Group’s small mass-market brand. Job No. 1 will be winning the trust of Nissan leadership and managers. After 20 years, the Renault-Nissan alliance still largely remains 2 separate companies (with the addition of Mitsubishi in 2017) with relatively few shared platforms. Notably missing is a common electric-vehicle architecture, even though Renault and Nissan were among the first automakers to introduce mass-market EVs. Nissan welcomed de Meo’s appointment. “We are all looking forward to working closely with him and our alliance partners in our efforts to support mutually profitable growth”, Nissan CEO Makoto Uchida said. De Meo lacks international experience however, having worked only in Europe during his automotive career. Analysts Evercore ISI said de Meo’s appointment brings 3 key questions: 1) whether he can restructure a business 2) if he has the profile to run a multicultural Asian/European business 3) if he does have “the political finesse” to handle French/Japanese relationships. At Seat, he attracted younger customers than VW’s other brands, but, like Renault, the Spanish nameplate remains largely dependent on the sluggish European market. De Meo’s appointment will bring stability to Renault, whose leadership has been unsettled since longtime CEO and chairman Carlos Ghosn stepped down a few months after his arrest in November 2018. But the challenges are formidable. Cash flow is looming as a potential problem. Nissan’s diminishing financial contribution to Renault, which holds a 43 % stake in the Japanese automaker, could affect the level of investment in r&d in critical areas like autonomous vehicles and electrification. Hoping to gain even more scale and synergies, Renault had agreed to pursue a merger last year with Fiat Chrysler Automobiles; a deal that fell apart at the last minute and drove FCA into the waiting arms of rival PSA. If the Renault-Nissan alliance does dissolve (Nissan managers have reportedly been planning for such a scenario) it would leave both companies struggling to compete for resources. Renault’s recovery might include rebalancing shares in the alliance among Renault, Nissan, and the French government, which still holds 15 % of Renault. Renault has a 43 % stake in Nissan, which has a 15 % share in Renault. France and Japan fell out over the treatment of the long-serving alliance leader Ghosn after his arrest in Japan in November 2018. Those tensions have only increased since Ghosn’s dramatic flight to Lebanon from Japan at the end of December. Aside from the alliance issues, the Renault brand is losing sales in some key markets, and the launch of the new generation Clio, its best-selling model, has been plagued with delivery difficulties, interim CEO Clothilde Delbos told investors in October. And Renault risks falling behind in EVs, once a market it had nearly to itself in Europe with the Zoe, as rivals like Peugeot, Opel and Volkswagen enter the market starting this year. New mass-market EVs are not expected until 2022. Delbos has said the company is pushing ahead with a wide-ranging review of its “Drive the Future” strategic plan devised by Ghosn in 2017, which has set ambitious targets for profits, production and platform-sharing. “Everything can be on the table”, Delbos said. Financial results will be announced on February 14, but third-quarter revenue at Renault fell 1.3 % and sales fell 4.4 %, largely due to weaker sales to partners, including Nissan. Renault’s full-year vehicle sales fell by 3.4 % to 3.75 million in 2019. The automaker’s sales rose 1.3 % in Europe but the gain failed to offset drops in other markets including a 19 % decline in volume in the company’s Africa, Middle East, India and Pacific region and a 17 % fall in China. +++ 

+++ SEAT has added advanced connectivity features and fuel-saving hybrid powertrains to its latest generation of its best-selling model, the Leon. The 4th generation is the brand’s first fully connected car and its most innovative product to date, Seat said at the model’s unveiling. The Leon will have an app that enables owners to remotely access data about their car. For example, they can set up speed alerts to be warned if someone using the car is driving too quickly. It also has voice recognition, Apple Car Play or Android Auto connectivity and an embedded Sim card. The number of in-car and online services will grow through the life of the vehicle as the digital ecosystem expands, Seat said. The Leon will offer mild hybrid and plug-in hybrid powertrains, along with gasoline, diesel and compressed natural gas engines. The mild hybrid option has a 48 volt starter-generator is offered with the 110 hp 1.0-liter and on the 150 hp 1.5-liter gasoline engines. The plug-in hybrid has a 1.4-liter gasoline engine combined with an electric motor powered by a 13 kWh battery. Total output is 204 hp. The Leon’s DSG direct-shift dual-clutch transmission now has shift-by-wire technology, with the gear selector connected to the gearbox through electronic signals. The Leon plug-in hybrid is 1 of 6 electrified models Seat plans to launch by early next year. It will join a full-electric version of the Mii, which is being rolled out to dealerships and the full-electric el-Born, Seat’s version of the VW ID3, which is due to launch later this year. The Tarraco will get a plug-in version later this year.The Cupra Formentor plug-in hybrid crossover is expected to reach the market before year end. Seat said it invested more than €1.1 billion for the new Leon, “mainly in the vehicle development and in the improvement of the production facilities”, said Carsten Isensee, the brand’s acting president. Design director Alejandro Mesonero said the Leon is “a bolder vehicle than the previous generation”. It has smooth flowing surfaces as Seat moves away from the straight edges and sharp angles of its current models. Seat has given the Leon new lighting features. It said the car’s the front LED headlights are set back to give “an eyebrow effect”. The new Leon is based on parent Volkswagen Group’s MQB Evo platform, which also underpins the new 8th-generation VW Golf. The car grows by 86 mm in length in its 5-door hatchback form and by 93 mm for the ST stationwagon variant. The car is slightly less tall and less wide than the current model. A 50 mm longer wheelbase for both variants adds more rear passenger room. The 380 liters trunk capacity stays the same in the hatchback and while the wagon’s cargo space grows by 30 liters to 617 liters. Sales of the Leon in Europe fell 3.5 % to 137.669 last year. The brand’s total European sales increased 12 % to 506.975. The Leon will have its public debut at the Geneva auto show in March. +++


+++ Buckle up. TESLA ’s quarterly report could be another wild ride for investors. The electric carmaker’s stock has more than doubled since Tesla’s previous quarterly report on October 23, when it posted a surprise profit that was viewed as a milestone for the company. Still, an analysis of Tesla’s and other luxury carmakers’ operating profit per vehicle (a metric closely watched by auto executives) shows Tesla still has a long way to go before reaching the steady profits of rivals Porsche, BMW and Mercedes-Benz. At an average of roughly $17,750 per vehicle, operating profit at luxury carmaker Porsche, for example, has been stable over the past 4 years. Mercedes’ and BMW’s profit per vehicle have been closer to $3,000. At Tesla, on the other hand, operating results fluctuated between a loss of nearly $20,500 per vehicle in the third quarter of 2017 and a profit of nearly $5,000 per vehicle in the third quarter of 2018. Calculating profits per vehicle allows for better comparison across the auto industry. Porsche, BMW and Mercedes were selected because their cars compete in similar price segments and for a like-minded customer base. Tesla’s rally in recent months has been fueled by its unexpected third-quarter profit, a production ramp-up at its new factory in China and better-than-expected car deliveries. While analysts on average expect Tesla to report another profitable quarter, it would be only the fifth such quarter since 2010. For the December quarter, analysts on average expect Tesla to post revenue down 2.9 % to $7.02 billion and adjusted net income of $305 million. Options traders expect more volatility after Tesla releases its 4th-quarter results. So far, Tesla options implied an 11 % swing for the shares in either direction by Friday. Over the last 8 quarters, the stock moved 9.5 % on average after Tesla reported results, according to options analytics company Trade Alert. Porsche last year released its first fully-electric sports car, while Mercedes and BMW have released their own electric vehicle versions. General Motors and Ford are gearing up to launch their own electric vehicles. While the German carmakers still largely rely on combustion engine-powered cars and are struggling to persuade customers to pay a premium for electric vehicles, they have a century of manufacturing and a well-developed global sales network behind them. As Musk’s nears the first tranche of a record pay package that depends in part on increasing Tesla’s market capitalization, the carmaker’s stock remains among the most divisive on Wall Street. While Tesla’s recent progress has cheered supporters, many investors remain skeptical of the company’s ability to consistently deliver profit and cash flow. As well as repeatedly missing targets in recent years, Musk’s mercurial behavior has come under scrutiny from financial regulators and shareholders. Tesla’s market capitalization must be sustained at or above $100 billion for both a 1-month and 6-month average in order to trigger the vesting of a $346-million tranche of options that are the first part of Musk’s record-breaking pay package. In the past 30 days, short bets against Tesla have decreased by almost $660 million to $14 billion, eclipsing the $12.9 billion worth of short positions against much-larger Apple and making Tesla the most shorted stock on Wall Street, according to S3 Partners, a financial technology and analytics firm. 9 analysts recommend investors buy the stock, 10 analysts have neutral ratings and 15 analysts recommend selling. +++ 

+++ The TRANSITION to electric vehicles will begin in earnest this year after 2019 saw a number of events, including the following, that marked the mainstream arrival of EVs in Europe: The Ionity network hit critical mass, with the world’s largest and fastest EV charging network set for completion in 2020 when the last of the planned 400 sites is expected to be operational. The Porsche Taycan was launched and with it the capability to add about 300 km of range within 10 minutes of charging. Tesla re-imagined the pickup of the future to great fanfare. Automakers continued to declare their intention to phase out internal combustion engines, with Daimler the latest to say it had no plans to develop a next-generation combustion engine, following rivals including Volkswagen Group. Along with these events came the acceptance of EVs as the next, logical step for people considering purchasing a new vehicle. Germany, for instance, recently overtook Norway as the leading nation for new EV sales, with a reported 9.1 % increase in sales to 57.533 last year through November. For fleets, this transition will begin in earnest in 2020 thanks to various schemes in place across the continent, from Portugal to Romania, as well as an increase in incentives tied to climate change initiatives such as Germany’s “environment bonus” for battery-powered vehicles. But incentives only tell part of the story. The coming year holds a lot more in the way of innovation with regards to the vehicles themselves and the infrastructure needed to charge them, and fleets across the continent stand to benefit. Research indicates that 88 % of the UK’s largest fleets, to cite 1 example, expect to order an electric car within the next 12 months. And as more of the mid-priced electric vehicles with more than a 320 km range become available, and as operators look at a vehicle refresh, I believe the EV fleet will really take off in 2020. There are significant drivers for this. The rise of low-emissions zones across Europe including those in the UK, Italy and Spain, to name just 3, will drive significant fleet interest as no operator wants to pay the costs of operating a combustion-engine fleet within a low-emissions zone. Additionally, EVs require less servicing, with fewer complex aspects to the motor. This lowers the overall annual operational expenditure for the entire fleet as well as the total cost of ownership for each vehicle. And with an increase in publicly available charging infrastructure, the average EV driver will be able to realistically switch to an EV from a combustion-engine vehicle without any trade-off to convenience. Within the year you will see a noticeable uptick in DC chargers made available within car dealerships, with an increase in easy-to-use and reliable chargers in-store. Why? Dealerships are always looking at ways to bring in additional sales beyond the initial vehicle purchase, and while it is estimated that foot traffic in-store is up, sales have reduced. A charger in a dealership is a way to increase that traffic and drive peripheral sales from the wave of EV drivers in need of a quick charge, and the installation and availability of 50 kW fast chargers will add about 100 km of range in 20 minutes for visitors. This 20-minute charge window is the ideal “sweet spot” as it is short enough to attract the driver with low wait times and to add enough range for their needs, and long enough for a salesperson to engage them meaningfully. During this time, salespeople can discuss everything from software and firmware upgrades to newer models. This will allow salespeople to build relationships with their customers that extend beyond the original sale of the vehicle, and with the threat of the online marketplace, this is a unique opportunity to attract loyal customers, including fleet operators and drivers. Contactless payments have revolutionized the point of sale experience for retailers across the globe, making sales and banking for retailers efficient and the customer experience seamless. There is something similar on the horizon for EV charging, known as Plug and Charge. Currently, the charging experience is based on membership programs, cross-network roaming, and RFID cards. But in 2020 this may become a thing of the past if, as I predict, plug and charge technology will begin to be rolled out across Europe and it will enable customer identification, authentication and billing; all via the charging cable. No more bank cards, no more RFID tags, simply a seamless experience. Think of the benefits for fleets? This will allow for easily manageable payments, simplifying the charging experience for fleet drivers by both streamlining and simplifying their interactions with the charging equipment. You will begin to see the first wave of this technology rolling out in 2020 and from there it will only be a matter of time before it takes off in the same way as contactless card payments for retailers. Watch this space. In 2020, spotting an electric vehicle on our roads will be a more commonplace occurrence and it’s simply a matter of time before EVs dominate the roads and bring with them a new era of zero-emissions driving. +++

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