Newsflash: Toyota komt met cross-over op basis van de nieuwe Yaris

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+++ The car-making ALLIANCE between Nissan and Renault is in tatters, according to the fugitive former boss Carlos Ghosn, who built up the Franco-Japanese partnership over 2 decades. “What we see today is a masquerade of an alliance that obviously with all the people involved is not going to go anywhere”, Ghosn said at a news conference in Beirut after fleeing charges of financial crimes in Japan. “I’m having a hard time seeing any strategic direction”. The former globe-trotting executive helped lead Nissan back from the brink following its rescue by Renault. As their alliance prospered (bringing in Mitsubishi in 2016) Ghosn made himself indispensable as the leader of all 3 companies. His shock arrest in November 2018 threw the automakers into disarray and brought infighting between Renault and Nissan into the open. In the subsequent months, the alliance came close to unraveling and communication between executives seized up. While relations have smoothed since amid changes in top management, Ghosn may have stirred up bad blood. He took direct aim at Nissan executives, whom he said were behind his ouster and legal quagmire in order to prevent a merger with Renault. Ghosn denied he was attempting to merge the partners, saying his plan was for a joint holding company and common board, with each keeping separate brands, headquarters and management. The former executive also ripped into his successor and former protege Hiroto Saikawa, whom he said led Nissan into decline despite starting out with a cash pile of billions and a leading brand. Ghosn named other Nissan officials Hari Nada, Hitoshi Kawaguchi, Toshiaki Onuma and Masakazu Toyoda as being behind a plot to bring him down. “The collusion between Nissan and the prosecutor is everywhere”, he said. “The only people who don’t see it are the people in Japan. How can it be legal?” Nissan reiterated an earlier statement that Ghosn was removed after a “robust, thorough” internal investigation and said it will continue to take appropriate legal action. The deterioration of relations between Renault and Nissan after Ghosn’s arrest has taken its toll on their stock performance. The French carmaker is trading near a 7 year low, while the Japanese automaker is at levels not seen in a decade. An industrywide sales slump and Renault’s failure to merge with Fiat Chrysler Automobiles (FCA) have also weighed on the stocks. Their financial performance is also hurting. “What I would do is completely different from what’s being done”, he said, without giving details. “There is no problem without a solution”. In addressing the media, Ghosn slipped back into his past leadership style as if he had not spent months in a Japanese prison far away from boardrooms and C-suites. “I can tell you that consensus doesn’t work”, he said. “You have to make sure that you force people to go for synergies. If you leave it to themselves, nothing happens”. Ghosn reserved some of his harshest criticism for the failure of Renault chairman Jean-Dominique Senard in June to merge with FCA, saying the automaker squandered an “unbelievable” opportunity. Ghosn claimed he was well-advanced in bringing FCA into the alliance fold. French rival PSA Group agreed last month to combine with FCA to create a global heavyweight, making Renault’s alliance with Nissan all the more crucial for both companies in the face of trade wars and an expensive shift toward electric and self-driving vehicles. To restore trust, both companies have since made changes in top management. Nissan replaced its CEO and Renault has embarked on its own CEO search after ousting Thierry Bollore, a former Ghosn protege. +++ 

+++ AUDI ’s new sales chief, Hildegard Wortmann, said the automaker is ready to win back ground lost to luxury-car leaders Mercedes-Benz and BMW, building on a revival in demand toward the end of 2019. Audi’s fortunes will be boosted by a young product lineup, a robust market for upscale autos and far-reaching restructuring program, Wortmann said. “We want to attack again”, said Wortmann, 53, who joined Audi 6 months ago from BMW. “Deep changes are needed, but I see great willingness across the organization to turn things around, and that makes me optimistic”. Audi, the biggest profit contributor at Volkswagen, is shuffling management and aims to trim its German workforce by about 15 % through 2025 to lift earnings by €6 billion and keep pace with a shift toward electric cars and digital services like ride-hailing. “Everyone kept talking for years about industry disruption. Now it’s here”, Wortmann said. Audi has been struggling to emerge from the turmoil of VW’s diesel-cheating scandal, with sales last year held back by production bottlenecks linked to more-complex WLTP emissions test procedures in Europe. The automaker wants to get profit margins back to about 10 % from the 7 % to 8.5 % forecast for 2019. The brand is seeking a fresh start after culling a third of its engine-gearbox combinations and ceasing production of the TT, to be replaced by a battery-powered successor. It may also terminate the R8 and make the flagship A8 full electric. “It’s a sign of courage to stop making icons like the TT that have shaped the brand and create new ones like the e-tron GT for a new era”, Wortmann said. There’ll be “stumbling blocks” along the way, she said, as Audi confronts the technical challenges of electric cars. The e-Tron, touted as a rival to the Tesla Model Y, was first delayed then hit by a recall just after its launch. Audi intends to boost its electric lineup to about 10 plug-in hybrids and 20 full-electric cars by 2025, more than at Mercedes-Benz and BMW. That will initially weigh on margins as combustion-engine autos still generate higher returns. Volkswagen in November announced another former BMW executive, Markus Duesmann, would join Audi as CEO. Duesmann starts in April, replacing Bram Schot, who succeeded long-time CEO Rupert Stadler after his arrest in connection with the diesel crisis, but failed to make an impression on the topmanagement of the Volkswagen Group. +++ 

+++ Volkswagen has created a sub-division named Volkswagen AUTONOMY tasked with developing self-driving technology for all of the group’s brands. Fittingly announced on the sidelines of the CES, the brand will be a standalone entity that will operate in Munich, Wolfsburg, Beijing and a city in Silicon Valley named Belmont. “Volkswagen Autonomy is the group’s center of competence for the development of autonomous technology”, explained Alex Hitzinger, the division’s CEO, during a media roundtable. He added its mission is to make self-driving cars a reality at a global scale, and create technology for the group’s brands. Designing a self-driving car is incredibly expensive, so scale is key. To that end, the tech startup Argo AI, which Ford and Volkswagen are both investing billions of dollars into as part of their burgeoning partnership, will bolster Autonomy’s development efforts around the world. The German automaker quickly pointed it’s not essentially taking over and renaming Argo, however; each entity will be responsible for a different part of the technology. “We need full control over the systems, because, as an OEM, we’re responsible for safety, and for the integration into our vehicles. Volkswagen Autonomy will do that. Argo will concentrate on core software”, Hitzinger said. Autonomy will reach the public in stages. Its engineers will notably develop the technology that will power the fleet of autonomous shuttles inspired by the ID Buzz concept that Volkswagen plans to roll out during the 2022 FIFA World Cup in Doha, Qatar. Hitzinger told engineers will be able to upgrade the technology packed in the vans in 2024 or 2025. That’s also when it will be ready for commercial applications. In recent years, many of the key players in the automotive industry have collectively adopted a more realistic stance about autonomous driving than in the beginning of the 2010s, and Hitzinger joined the chorus. Technology is advancing quickly, but there are some hurdles which will take much more than billion-dollar deals to clear. “Level 5, in my view, is a theory”, he said. “That means full autonomy, everywhere, at any point in time. That maybe will never happen; who knows? I always talk about Level 4”. +++ 

+++ Chevrolet is working on a plug-in hybrid CORVETTE . I don’t know yet what the gas engine’s displacement may be or even how many cylinders that engine contains. Prototypes sounded like a V6, but that’s not a lot to go on. Speculation on an electrified Corvette in the past has also included talk of all-wheel drive with an electric motor powering the front wheels and a traditional engine sending ponies to the rear. Back when the mid-engine C8 was first unveiled, General Motors president Mark Reuss suggested this latest Corvette worked into GM’s “strategy of 0-0-0: zero emissions, zero crashes, zero congestion”. Reading between those lines, I wouldn’t be surprised if a plug-in Corvette would be able to travel solely on electric power for short jaunts. But I also expect any electrification to contribute to the car’s overall acceleration, considering the Corvette’s role as GM’s high-performance flagship. +++ 

+++ “Uncertainty” was the watchword for car sales in EUROPE going into 2019, and that will again be the case in 2020, executives and analysts say. Last year, caution centered on Brexit, tariffs and the lingering effects of the Worldwide harmonized Light vehicle Testing Procedure ( WLTP ). None of those factors have completely disappeared, but the big unknown is how buyers will react to a wave of electrified vehicles needed to meet new EU emissions rules. “I think that 2020 will be a very interesting year, because we will see if the consumers are ready to buy electric vehicles, if the infrastructure that’s needed is in place, if the different use cases are working”, Faurecia CEO Patrick Koller said. “We will see”. Peugeot CEO Jean-Philippe Imparato warned of turbulence at the end of 2019 and the beginning of 2020, as automakers go from average fleet CO2 emissions of about 120 gram per kilometer at the start of 2019 to 95 g/km, the new EU standard, on January 1st. To count as a 2019 sale, cars had to have been registered before that date. Overall sales will be “stable” in 2020, Imparato told, but he expects there to be a “seasonal effect” on first-quarter demand because of the tougher emissions regulations. “I’m not sure all the automakers are ready for them”, he said of the new targets, which will apply to 95 % of all vehicles sold in 2020 and 100 % of those sold next year. “If you are not ready now in terms of product, production and stock management, you will be dead in January”. A 4-year post-recession run of sales growth slowed to a halt in 2018, with the European market slipping into negative territory, down by 0.04 %, and the Western European market down by 0.7 %. Final figures for 2019 are not available yet, but the overall market is expected to be flat. For next year, analysts are predicting that European sales will fall somewhat. LMC Automotive is forecasting a decline of 1 % in Western Europe in 2020. Jonathon Poskitt of LMC said in a note: “We are now a little more cautious on 2020, with overall volumes expected to be lower than this year. Economic challenges remain, particularly in light of the external trade environment and Brexit uncertainty”. He said that there is a risk that automakers may have to take action that could have an effect on total market volumes because of forthcoming CO2 targets. Moody’s is more bearish, predicting that Western European sales will drop by 3 percent in 2020, revising downward an earlier forecast. Factors in the slowdown include uncertainty around Brexit, and a weakening macroeconomic environment, especially in Italy and Spain. However, Moody’s noted that the European market has been at a high level of sales for several years, and that a slowdown in 2020 would return the market to 2017 volumes. Separately, IHS Markit is forecasting a 2 % decline in EU plus EFTA sales (Iceland, Norway and Switzerland). “We are seeing a slight decline”, said analyst Martin Benecke, noting that formerly strong growth markets in Central and Eastern Europe are now more closely tracking Western European countries. “On the economic side, the ongoing Brexit uncertainty is holding back investment, not only in the UK but in other nations”, he said. On trade issues involving China and the U.S, “It’s not clear what’s going to happen”, he added. But emissions compliance remains the main question around sales this year, Benecke said, for a number of reasons. Model portfolios will change as higher-polluting cars with older technology are pulled in favor of full-electric cars, plug-in and regular hybrids, and mild hybrids. This in turn will increase prices overall, possibly affecting demand, he said. Automakers could also push diesel sales, even though the future of the powertrain has been in doubt because of fallout from the Volkswagen Group cheating scandal. After several years of sharp declines, tied to a loss of consumer confidence, increasing cost of emissions compliance and the effects of current and future diesel bans, sales have stabilized somewhat. Benecke said IHS forecasts that the diesel market share in 2020 will be 31 %, just one percentage point below 2019’s figure. Nevertheless, the powerplant’s long-term future is in doubt, he said, because it is increasingly difficult to find further gains in CO2 emissions. Another unknown is how automakers will ensure that enough low-emissions vehicles are sold to meet fleet emissions targets. Benecke noted that manufacturers have many levers to pull because relatively few cars are sold to private buyers. Those tools include self-registrations, favorable lease terms for employees, and sales to short-term (car-sharing) and traditional rental fleets. Said Benecke: “They have a lot of power to bring these vehicles to market”. +++ 

+++ FIAT CHRYSLER AUTOMOBILES (FCA) Belvidere assembly plant near Chicago will be temporarily idled for 2 weeks as the company aligns production with demand. Normal output at the factory, which assembles the Jeep Cherokee, will resume the week of January 27, the company said. American sales of the Cherokee, Jeep’s No. 3 seller after the Grand Cherokee and Wrangler, fell 20 % last year to 191.397 units. Demand slid 30 % in the 4th quarter. FCA had 53.000 units of the Cherokee in inventory on January 1st, or a 97 day supply, up from a 91 day supply on December 1st. FCA invested $350 million in the plant, starting in 2016, to produce the Cherokee, which was moved from Toledo, Ohio. Cherokee production began in Belvidere in June 2017. The plant also briefly shut down in August to match production with demand. About 1.400 people were laid off at the factory last year when output was reduced to 2 shifts from 3. The plant employs around 3.700 workers. The UAW’s new contract with FCA calls for a $55 million investment in the factory. Cherokee production is slated to continue. Next-generation safety features will be added in 2020, according to details of the union’s new labor pact. Over the years, the plant has also produced models such as the Dodge Dart and Neon and the Jeep Compass and Patriot. +++ 

+++ A Lebanese prosecutor imposed a travel ban on former Nissan boss Carlos GHOSN , judicial sources said, after he was questioned over an Interpol warrant issued by Japan seeking his arrest on financial misconduct charges. Ghosn fled Japan to Lebanon, his childhood home, last month as he was awaiting trial on charges of under-reporting earnings, breach of trust and misappropriation of company funds, all of which he denies. The Lebanese judicial authorities also asked Japan for its file on Ghosn, including the charges against him, and will not question him again until the information is received, one of the sources said. Carlos Abou Jaoude, a Beirut-based lawyer for Ghosn, told Ghosn was “very comfortable” with the proceedings in Beirut. “He is very comfortable with the path”, Jaoude said, adding that Ghosn was also comfortable himself “especially after what he went through”. The decision issued by the prosecutor, Judge Ghassan Ouiedat, requires Ghosn to keep the authorities informed of his place of residence, the judicial sources said. Ghosn would surrender his French passport to the Lebanese authorities, 1 of the sources said after the questioning, which took place at Beirut’s Justice Palace, the headquarters of the judiciary. The Brazilian-born Ghosn said he had escaped to Lebanon to clear his name and was ready to stand trial anywhere he could get a fair hearing. Ghosn said he was ready to stay for a long time in Lebanon, which does not allow the extradition of its nationals, and a source close to the 65-year-old has said his legal team is pushing for him to be tried in the country. In addition to the Interpol warrant, Ghosn was also questioned over a formal legal complaint filed against him by a group of Lebanese lawyers who accuse him of “normalization” with Israel over a visit he made there in 2008. The prosecutor released him with the same condition, that he keep the authorities aware of his place of residence, the sources said. There was no immediate statement from the prosecutor’s office. In his comments, Ghosn’s lawyer Jaoude said a statement would be issued by Ghosn’s team later. Ghosn said he had made the trip as a French citizen and an executive of Renault to sign a contract with a state-backed Israeli firm to sell electric vehicles and had been obliged to go because the board had requested it. He has apologized for the trip and said he had not meant to hurt the people of Lebanon, which deems Israel an enemy state. During the visit, Ghosn met Israel’s former prime minister Ehud Olmert, who was premier at the time of the 2006 war between Israel and the Iranian-backed Lebanese group Hezbollah. Nearly 1.200 Lebanese, mostly civilians, died in the 2006 war and 158 people died in Israel, mostly soldiers. +++ 

+++ JAPAN ’s justice minister launched a rare and forceful public takedown of auto executive-turned-fugitive Carlos Ghosn after he blasted the country’s legal system as allowing him “zero chance” of a fair trial as he sought to justify his escape to Beirut. After his dramatic flight to Lebanon last month, Ghosn spoke in public for the first time, saying he had been treated “brutally” by Tokyo prosecutors. He said they questioned him for up to 8 hours a day without a lawyer present and tried to extract a confession out of him. In an effort to undo Ghosn’s attempt to sway public opinion in his favor, Justice minister Masako Mori followed shortly with a statement: “I decided to do this because defendant Ghosn was looking to justify his unlawful exit from Japan by propagating a false recognition of our justice system”, she said. “I felt that we needed to respond immediately to broadcast a correct understanding to people around the world”. Mori said Ghosn’s escape from his trial in itself “could constitute a crime” that would not be tolerated in any country. “My impression in listening to him was that there were few statements that were backed by any real evidence”, she said. “If he wants to prove his innocence, he should face fair trial proceedings here”, she added, stressing that the allegations against him concerned financial crimes in Japan. “That would be the mark of a first-class businessperson and good citizen”. Mori blasted Ghosn for violating his bail by fleeing the country “without showing a passport and breaking international rules that everyone in the world follows. It was a breach of faith that can’t be explained to our children”, she said. The spotlight on Japan’s justice system comes as Mori is set to host in April the United Nations’ Congress on Crime Prevention and Criminal Justice, held once every 5 years. Defending authorities’ jailing of Ghosn, Mori said that in Japan, a suspect can only be arrested with a warrant from the court upon review by a judge, unlike in some countries where detention is possible without a warrant. She added that indictments were only made in Japan when there was ample evidence toward a conviction, saying criticism of Japan’s 99 % conviction rate was therefore unwarranted. Mori repeated that Japan would try to find a way to bring Ghosn back from Lebanon. Interpol has issued an international arrest notice at Japan’s request, which Ghosn said his lawyers could fight. Ghosn, for his part, said he was prepared to stand trial in any of his three home countries of Lebanon, France or Brazil, none of which have extradition agreements with Japan. +++ 

+++ JEEP has wasted no time in making use of the new partnership between FCA and PSA by starting development on a new ‘ultra-compact’ SUV that will be pitched as a more rugged alternative to the likes of the Nissan Juke and Volkswagen T-Cross. It’s going to be offered as a fully electric vehicle, too. Senior Jeep officials have confirmed to us that the as-yet-unnamed model will be in showrooms by 2022. The small SUV is being developed with European markets in mind, because the segment is one of the fastest growing in a region where Jeep still sees significant scope for higher sales. When quizzed about the vehicle’s brief and styling, Marco Pigozzi, Jeep’s European Head of Brand Marketing, said the crossover would offer plenty of day-to-day practicality, but without compromising Jeep’s renowned off-road capability. “The car will be able to be used as a bad-ass Jeep, but it has also been designed to be used every day”, Pigozzi told. The forthcoming baby SUV will be around 4 metres in length, which will make it slightly longer than a Suzuki Jimny, but a few millimetres shorter than the recently-launched Juke. It will retain Jeep’s chunky styling cues and boxy proportions. Given Jeep’s recent push towards electrification (starting with the launch of plug-in hybrid versions of the Renegade and Compass), it’s almost certain that the brand’s new small crossover will feature some form of battery power. When asked about the possibility of electric drive, Pigozzi stated: “We have the capability to deliver the electrification we need”. That’s a strong hint that the car is almost certain to adopt the Common Modular Platform (CMP) architecture used for the Peugeot 2008 and DS 3 Crossback, among others. As well as being able to accommodate petrol and diesel power, the platform can also feature fully electric drive with a range of up to 340 kilometres on a single charge. Jeep’s short-term electrification strategy was sparked by the recent launch of the plug-in hybrid Renegade and Compass, both of which use a turbocharged 1.3-litre 4-cylinder petrol engine, a compact lithium-ion battery pack and an electric motor mounted on the rear axle. The system produces 190 hp and 320 Nm, and will give both models a claimed maximum all-electric range of around 50 kilometres. Pigozzi outlined to us the benefits of electric motors when driving off road. “The move from mechanical to ‘e’ all-wheel-drive is a massive improvement: it’s more capable than a conventionally powered Jeep”, he said. “The enormous torque on offer from the electric motor allows the car to easily crawl over rocks and obstacles. And the fact that it’s mounted on the rear axle means the car is pushed up hills rather than pulled”. Jeep’s rapid shift to electrification, with its forthcoming range of all-electric and plug-in hybrid models, should help the brand pull its average emissions below the forthcoming EU-regulated range average target of 95 g/km, which is being phased in this year and will come into force by 2021. +++ 

+++ Ex-Nissan boss Carlos Ghosn said that a surprise corporate move, orchestrated 5 years ago by French president Emmanuel MACRON , who was then economy minister, soured relations between Renault and Nissan and contributed to his ouster. Ghosn, the former head of the car alliance, said Nissan executives and Japanese officials were shocked by a 2015 decision by the French government to increase its voting rights at Renault. “This left a big bitterness. Not only with the management of Nissan, but also the government of Japan”, Ghosn told. And this is where the problem started”. In April 2015, as a 37-year-old minister with then-unknown presidential ambitions, Macron ordered a surprise increase in the state’s stake in Renault designed to secure double voting rights. The overnight move gave the French state a blocking minority in Renault, which in turn controlled Nissan via its 43.4 % stake in the Japanese firm. According to French and Japanese sources, that rattled the Japanese side of the Renault – Nissan alliance, which feared a national champion was falling under the control of the French government. In the ensuing 8 month boardroom fight between Macron’s ministry and Hiroto Saikawa, Nissan’s second-in-command at the time, Ghosn sees the seeds of what he says grew into a conspiracy to have him arrested and oust him from control of Nissan. “There started to be some kind of defiance from our Japanese colleagues, not only about the alliance but also about me”, Ghosn told. “And some of our Japanese friends thought: The only way to get rid of the influence of Renault on Nissan is to get rid of him”, he added. “Unfortunately, they were right”. Following Ghosn’s arrest in November 2018, Nissan executives said that governance had been eroded by Renault’s control. Saikawa subsequently contested Renault’s right to appoint executives and directors under the alliance master agreement. “President Macron himself has skin in the game”, Max Warburton, an analyst with New York-based asset manager AllianceBernstein, told in the weeks following Ghosn’s arrest. “He must recognize that his decision in 2015 to increase the French state’s holding in Renault likely impacted Japanese perceptions of the alliance and heightened concerns that Nissan was ultimately within the control of the French government”. Ghosn said that, partly because of the mistrust caused by the 2015 row, he had doubts about the future of the alliance. Asked if he felt let down by the French government’s muted response to his arrest, Ghosn replied: “How would you have felt in my place? Supported? Defended? Let down? I don’t know. I won’t state a view for now. I am a French citizen like any other. I’m not asking to be treated better than anyone else, but I shouldn’t be treated less well than others either. When the French president says ‘presumed innocent’, I believe him. But when French officials say ‘presumed innocent’ and have a body language that says ‘he is guilty’, I don’t agree with that”, Ghosn said. +++ 

+++ Daimler sold 2.34 million MERCEDES-BENZ passenger cars in 2019 for a 9th consecutive year of record sales, it said, putting the German carmaker in pole position to retain the title of biggest-selling premium car brand. Stuttgart-based Daimler claimed it had retained the title of best-selling luxury car brand. However, rival BMW, the brands of which include Mini and Rolls-Royce, has yet to give a breakdown of its global sales. As a carmaking group, BMW sold 2.52 million vehicles last year to beat Daimler’s 2.46 million Mercedes-Benz and Smart vehicles over the same period. Mercedes-Benz said it posted sales records in Germany, China and the United States thanks to strong demand for its sports utility vehicles and high-end limousines. Daimler said Mercedes-Benz sales rose 6.2 % in China, where local customers ordered the top-end Maybach Mercedes-Benz S-Class limousine at a rate of more than 700 vehicles a month. Audi said it had sold 1.84 million cars last year, up 1.8 % year on year, thanks to a 4.1 % jump in Chinese sales including Hong Kong. Audi said it sold 19.500 e-Tron cars in Europe last year while Daimler declined to provide a figure for how many Mercedes-Benz EQ C units it delivered to customers. +++ 

+++ Automotive exports from MEXICO fell for the first time in a decade last year, dragged down by weak demand from outside the United States, and Mexican carmaking is likely to suffer fresh reversals in 2020, an industry group said. Carmaking is a pillar of Mexican manufacturing, and a forecast by the outgoing head of Mexican automotive industry association AMIA that output and exports would decline again in 2020 does not augur well for Mexico’s stagnant economy. “It’s not a matter of the plants’ capacity, it’s about how much of this production the market is absorbing”, departing AMIA president Eduardo Solis told a news conference. “We’re seeing major falls at a global level”. Last year, Mexico’s auto production slipped by 4.1 % to 3.750.841 units, national statistics agency INEGI said. It was the second annual decline in a row, and the biggest since the recession Mexico suffered in 2009 after the financial crisis. Mexico has been struggling to stave off recession ever since President Andres Manuel Lopez Obrador took office in December 2018 pledging to increase economic growth. Only robust demand from the United States has prevented a bigger slowdown. The leftist Lopez Obrador’s economic decisions have unsettled some investors, while commercial disputes pursued by U.S. president Donald Trump have roiled international trade. Drawn-out and at times testy negotiations between Mexico and U.S. lawmakers over a new regional trade deal, the United States-Mexico-Canada agreement, also fed uncertainty about Mexican access to its principal foreign marketplace in 2019. Mexican auto exports fell by 3.4 % to 3.333.586 units last year, INEGI said, the first annual decline since 2009. AMIA data for the year through November show that while auto exports to the United States grew by nearly 5 percent over that 11 month period, shipments were down to Canada by 12.5 %, to Latin America by 28.6 % and to Europe by 20.1 %. Solis at AMIA forecast that in 2020, Mexican production would fall to about 3.5 million autos and that exports would be around 80 % of that figure, or about 2.8 million units. Mexico’s auto industry ended the year with a whimper, with auto output tumbling in December by 12.7 % and exports by 16.7 % compared to the same month a year earlier. Meanwhile, a monthly gauge of Mexican industry showed that activity in the manufacturing sector suffered its biggest contraction since at least April 2011. The weak data will add to fears that Mexican gross domestic product may have suffered its first contraction in a decade in 2019 when official figures are published in coming weeks. +++ 

+++ Conspiracy theories, government plots, prison escapes, billions of dollars of shareholder value up in smoke. If Netflix commissions a yarn based on the life of Carlos Ghosn they won’t lack for salacious material, judging by the ex-Renault boss’s eyebrow-raising press conference on Wednesday. Still, declining to substantiate conspiracy claims about his downfall is a MISSED OPPORTUNITY to make headway in the court of public opinion. In an animated gathering in Beirut, Ghosn mostly sought to impugn the Japanese justice system which held him for an alleged 130 days in solitary confinement, interrogated him for up to eight hours day or night without a lawyer present, prohibited visits from his wife and restricted the wealthy ex-head of the world’s second biggest car conglomerate to just two showers a week. All that, he argued, justified his daring decision to skip his $9 million bail and escape in a private jet to Lebanon. Maybe so. But having credibly argued that the Japanese were resentful about Renault’s outsized influence at Nissan, he then declined to substantiate the all-important claims about the collaboration between government and company executives to plot his downfall. Ghosn justified not naming names by not wanting to damage Japan-Lebanon bilateral relations. But given Beirut is expected to ignore an Interpol warrant for his arrest, these probably weren’t looking that hot anyway. What there was instead was over an hour of rambling rebuttals to Tokyo’s charges that Ghosn under-reported income and shovelled company funds to friends and family. Regardless of their merits, these were liberally sprinkled with foot-in-mouth moments which took in comparing the shock of his arrest to that experienced by the U.S. fleet at Pearl Harbor, and stressing that his style of leadership had been the subject of 20 books on management. He defended hosting a sybaritic party at French palace Versailles because it was “the symbol of the globalisation of France”. The assembled hordes of international press showing up in Beirut were more interested in the James Bond antics via which Ghosn had fled Japan. They didn’t quite get what they wanted. But nor did anyone wanting to nail down whether the corporate titan’s case has legal merit. +++ 

+++ In the United States, auto sales have gradually slowed from their peak during the boom years that followed the global recession, but NISSAN ’s rapid decline stood out even in a year when few high-volume manufacturers had much to be excited about. Of the ‘Japanese 3′, Nissan’s 2019 performance was by far the most troubling. Through November, when the company last posted its global sales figures, its volumes were down 8 % compared to 2019. In the United States, its full-year numbers were down 9.9 % in an industry that slid just a hair more than 2 % overall. Meanwhile, Honda managed a slight increase in U.S. sales (0.2 %) and Toyota, much like the industry in general, finished the year down approximately 2 %. Like Nissan, Honda and Toyota have remained committed to compact and midsize sedans, and have a comprehensive portfolio of offerings in the key SUV and crossover segments. On paper, Nissan’s lineup checks all the right boxes. From the subcompact Kicks up to the Armada, it has something for sale in virtually every possible nook and cranny of the people-mover segment, but almost all of these took a beating in 2019. Only the baby Kicks managed to improve on its 2018 sales, which isn’t saying a whole lot, considering it was barely sold in 2018 to begin with. In fact, the bonus volume contributed by Kicks helps obscure just how poorly some of Nissan’s key offerings performed last year. Combined Rogue (X-Trail) and Rogue Sport (Qashqai) sales slid 15 %; Murano was down more than 18 %; the Pathfinder and Armada managed to pace the general industry, dropping 2.8 % and 1.9 %, respectively, but the astute reader will note at this point that we’ve yet to single out any bright spots. The news was even worse on the truck side. Frontier was down 9.1 %. Titan? Down 37.5 %. Elsewhere, crossovers and SUVs are selling. Pickups, even from import brands, are also selling. Toyota’s mid-size Tacoma was up in 2019; both it and the full-size Tundra still more than tripled the volume of their Nissan competitors. Further muddying the waters, Honda managed its year-over-year volume increase without selling a full-sized pickup at all. What, then, is Nissan’s problem? To borrow an oft-used phrase, “It’s the product, stupid”. The most striking evidence of this issue is the Rogue, which competes in a segment where vehicles essentially sell themselves. The Rogue and Rogue Sport were in the running for segment best-seller for several years, but Honda’s CR-V slapped the Rogue twins out of a potential second-place play in 2019 with more than 380.000 sales. Toyota’s RAV4 is as dominant as ever, closing in on nearly 450.000 sold. The RAV4 is brand-new; the CR-V was introduced in 2016. The Rogue? 2013. The Qashqai (Nissan’s name for the Rogue Sport in other global markets) is just as old despite its late introduction to the United States. The Pathfinder’s steady-ish performance may seem like good news for Nissan, but holding its ground at 65.000 sales in a segment where Toyota is selling 240.000 Highlanders and Honda is selling 135.000 Pilots simply won’t fly. Oh, and the Pathfinder was new in, you guessed it, 2013. Age is just a number, some might say, and Fiat Chrysler Automobiles (FCA) has proven time and again that old products can still sell, but unlike Nissan, the Italian-American automaker has put serious effort behind keeping its products relevant despite their old bones. FCA’s Uconnect infotainment system, for example, has received praise from critics and benefited from frequent updates to keep its features current for a consumer base that expects robust and reliable connectivity. Nissan, meanwhile, is just now getting around to introducing Android Auto and Apple CarPlay, especially in its premium Infiniti lineup (2019 sales: down 21.1 %), which is finally showing the first signs of modern smartphone integration for the 2020 model year. Disgraced ex-Nissan CEO Carlos Ghosn commented about the automaker’s recent slide, pointing out that the management of the Renault – Nissan – Mitsubishi alliance managed to foul prospects for a merger with FCA, which would have created a tier-one international automotive powerhouse and given Nissan access to cost-sharing opportunities in the critical pickup and SUV segments in which its aging products aren’t keeping pace. This leaves Nissan to effectively go it alone, as it can’t count on its alliance partners to contribute much to the segments Americans want most. Such a precarious position is made worse by the company’s softening push into new technology. After starting strong with the all-electric Leaf, Nissan has remained content with offering incremental improvements to the small hatchback rather than expanding the concept to other segments. If Nissan can’t sell competitive cars in existing segments and refuses to explore potential growth opportunities in others, this leaves me wondering what exactly it can do, besides lose customers. 

+++ A surge in the value of TESLA ’s shares has seen the company become the most valuable American car maker of all time. With a market capitalisation of $82 billion, Tesla has beaten Ford’s 1999 record of $80.81 billion, and is now worth nearly as much as Ford and General Motors combined. Short sellers (traders who bet a company’s value will decline) are said to have lost over $8 billion in the last 7 months as Tesla’s stock has risen. Tesla is currently trading at $469 a share, up by more than $130 since the Cybertruck was revealed in November. Ford (market capitalisation of $36 billion) and General Motors ($50 billion) produce roughly 14 million vehicles a year between them, making Tesla’s record output of 367.500 last year; up 50 % on 2018, in line with projections, tiny by comparison. But as a dedicated maker of electric vehicles, Tesla has forged a path for mainstream manufacturers to follow, leaving giants like Volkswagen and Toyota to play catchup as consumer tastes and legislation increasingly favour electric vehicles rather than those powered by fossil fuels. And while enterprises like the Ionity charging network make inroads in the public charging sphere, as consumers are encouraged to switch to EVs, Tesla’s Supercharger network offers advantages that are hard for other firms to match. Similarly, Tesla’s battery tech (refined and improved continuously since the firm was founded in 2003) can produce ranges of more than 480 kilometres, greater than those typically offered by rival EVs. The firm also stole a march in the rush to reduce reliance on cobalt. Further market advantages include the fact that as a maker of EVs, Tesla is able to capitalise on the fact manufacturers of petrol and diesel cars are struggling to match European emission targets that mandate their cars must emit no more than 95 g/km of CO2 by 2021 or face billions of Euros in fines. In Spring last year, for example, Fiat Chrysler Automobiles (since bought by PSA) paid Tesla “hundreds of millions” of Euros so that Tesla’s CO2 ‘credits’ would count towards FCA’s official CO2 outputs. Tesla’s electronics are also said to be significantly more advanced than some car makers’. Sandy Munro from Munro & Associates (an American firm that conducts ‘teardown benchmarking’ of cars to determine how they are made and what costs are involved in their manufacturing) previously told that the Tesla Model 3’s circuit board design is highly sophisticated, and “like nobody has got”. “This is cellphone technology”, Munro said. “The technology we would see in really high-end computers … spectacular … the same kind of technology you would see on the flight controller for an F35. Everything here smacks of cellphone technology and defence technology”. Munro did, however, criticise the Model 3 build quality. Projects like Tesla’s solar panel manufacturing subsidiary SolarCity have been dogged by controversy, while critics have questioned whether the firm’s Semi (slated for production at the end of this year) will have large enough batteries to tow heavy loads meaningful distances. Safety experts have also criticised claims Elon Musk has made about the ‘self-driving’ ability of Teslas. None of these concerns have dissuaded investors from valuing Tesla above all other American car makers, however, even if the firm is still playing second fiddle to Volkswagen (market cap: $98.65 billion) and Toyota ($227.9 billion) on a global scale. +++ 

+++ TOYOTA is preparing a new small SUV that will give the company a rival for the likes of the Nissan Juke and Renault Captur, and it’s likely to arrive in dealerships within the next 18 months. The as-yet-unnamed model is designed to sit below the C-HR, despite the fact that the futuristic crossover is already slightly smaller than the likes of the Nissan Qashqai and Peugeot 3008. Toyota believes that having a car closer to the 4.0-metre length of most superminis will appeal to customers put off by the C-HR’s higher price. Toyota’s European executive vice-president Matt Harrison admitted the company was already considering expanding its SUV line-up at the smaller end of its range. “SUV segments in general are all continuing to grow”, he told. “The C-HR is playing in the very top end of what could almost be a sort of coupé-crossover C-segment SUV. It doesn’t really compete with other products like Qashqai or more practical offerings. If you look at the level of conquest we have with that car, it’s incredible, even from premium brands. But the way that area of the market is continuing to grow and sub-divide, there would definitely be opportunities for additional products. I don’t think for a minute that we’ve got it all covered with C-HR”. He added: “The traditional supermini hatch (like the Ford Fiesta and Toyota’s Yaris) is probably the most robust of the segments. It’s holding up better than saloons and larger hatchbacks against crossovers, partly because of affordability, I think. But the B-SUV segment is also growing, pulling customers down from the C-segment. So we’re looking, we’re evaluating, and we see an increasing number of players doing that. There may be opportunities in future. The platform is flexible enough to support something like that, for sure”. Indeed, the new small SUV has already received the green light from Toyota HQ in Japan and it’s certain that it will be based heavily on the technical underpinnings of the latest-generation Yaris, which made its debut back in October. That means that it will be the second car to use the TNGA-B architecture, mixing MacPherson struts at the front with a torsion beam at the rear. Expect the new model to be only a few millimetres longer than the Yaris, nudging it just over the 4-metre mark, and around 40 mm taller to give the higher seating position that customers in this market are after. Toyota may also choose to extend the Yaris’s wheelbase slightly, giving the SUV a little more rear legroom to counter the likes of the Renault Captur and in particular the Citroen C3 Aircross and Skoda Kamiq. The TNGA-B underpinnings mean that the new model will feature electrification at the heart of its range; indeed, given the slightly higher price positioning over the Yaris, Toyota may choose to avoid the supermini’s entry-level 1.0-litre petrol engine and make its new offering’s line-up entirely hybrid. That would mean using the same 1.5-litre petrol-based hybrid powertrain as the Yaris, with a total system output of around 115 hp and the ability to complete up to 80 % of urban journeys on electric power alone, thanks to a lithium-ion battery pack. A more conventional 1.5-litre offering, including a manual gearbox alongside Toyota’s familiar CVT auto, could also be made available according to market demand. But despite the fact that the vehicle can be offered with more sophisticated multi-link rear suspension and 4-wheeldrive (as with the Yaris, it may well get that option in Japan) European examples of the new arrival will be front-wheeldrive only, regardless of engine choice. Inside, expect the baby SUV to get the same infotainment set-up as upper-end Yaris models, with a 10-inch head-up display and a large central touchscreen incorporating Apple CarPlay and Android Auto. Toyota will reveal the new small SUV in the second half of 2020. Sales are unlikely to start until spring 2021 at the earliest. +++ 

+++ The VOLKSWAGEN Group said it delivered 10.8 million vehicles to customers last year; up 0.9 % from 2018. Its divisions include the VW, Audi, Skoda, Seat, Porsche, Bentley, Lamborghini and Bugatti car brands, as well as the Scania and MAN and heavy truck makers. VW Group CEO Herbert Diess issued the revised outlook during an investor presentation in New York. VW had earlier forecast that 2019 vehicle sales would be level with 2018. The group reiterated it expected an operating return on sales of between 6.5 % and 7.5 % before special items for last year. VW is due to release 2019 earnings on March 17. Global automakers scaled down production last year when sales started to decline in some regions due to slower economic growth and trade friction. VW’s higher outlook adds to evidence the slump may have been less pronounced than initially feared, at least for some companies. Demand for SUVs remained robust and sales of electric and hybrid cars accelerated. Some luxury automakers have also reported higher sales. VW Group also said that it would invest €7 billion to create a dedicated software organization to raise in-house software development to 60 % from 10 %. The software organization starts operation this month, according to the investor presentation. +++

 

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