Newsflash: Audi werkt aan elektrische stadsauto

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+++ The current ASTON MARTIN Vantage has lapped the Nurburgring Nordschleife in 7:43.92 in the hands of Christian Gebhardt. In the grand scheme of things, such a time isn’t particularly fast and places the Vantage 0.1 seconds behind the Honda Civic Type R and over 3 seconds behind the Renault Megane RS Trophy-R. It also makes it slower than super sedans like the Porsche Taycan, Panamera Turbo, BMW M5 and Alfa Romeo Giulia Quadrifoglio. It is very likely that as production of the current-generation Vantage continues, Aston Martin will steadily improve its performance. Most notably, the car manufacturer may decide to sell a variant equipped with the 5.2-liter twin-turbocharged V12 engine currently available in the likes of the DB11 and tuned for use in the DBS Superleggera. +++ 

+++ AUDI is planning a huge expansion of its e-Tron electric range over the next 5 years, and now a senior official at the firm has admitted that this wider range will stretch to a small car based on the VW Group’s entry-level EV platform. Known as MEB Entry, the architecture was revealed at the VW Group annual conference last spring. It’s designed to support vehicles of around 4 metres in length, about the same as a Polo or an Audi A1, while keeping down costs sufficiently for these models to be able to sold from around €20,000. Responsibility for the project (which is due to deliver its first model by the end of 2022) has been handed to Seat and its chief engineer Axel Andorff. The focus on cost-cutting has led to speculation that the platform will be restricted to cars from Volkswagen, Skoda, Seat and a Chinese sub-brand. However, Audi’s board member for product marketing, Fermín Soneira Santos, said that the premium brand intends to use MEB Entry as another element of an extremely broad EV portfolio: everything from supermini-sized models up to the e-tron GT super-saloon, which is based on the running gear of the Porsche Taycan. When asked if Audi is involved in the MEB Entry project with a view to launching a car based on it, Soneira Santos told: “It is on our horizon, yes. It’s not yet designed, but yes, we have a chance to have cars on MEB, maybe tomorrow on MEB Entry, then also the e-tron GT. We have so many different platforms to choose from and where we can have input into. If you would talk about segments, Audi is going to be the one with the widest portfolio over the next years, compared with our competitors. We can go smaller and higher with less investment than our competitors. It’s an advantage”. Sources have told that the cheaper nature of MEB Entry may leave less scope than usual for bodywork modifications; perhaps resulting in common profiles across more than one brand, as per the Volkswagen Up, Skoda Citigo and Seat Mii. Audi would then have to rely on more premium cabin materials and in-car technology to help differentiate its version. The new model could allow Audi to capitalise on an emerging sector of the electric-car market, where customers are willing to pay more for premium products with still-modest battery ranges. MEB Entry models are expected to have between 200 and 240 kilometres of range, but in theory this would be enough for the car to rival the recently launched Mini Electric and the Honda E; both cars that prioritise image and design over outright battery range. Audi’s first car on the regular MEB platform (which is set to make its debut with the Volkswagen ID.3 this summer) will be the Q4 e-tron. Soneira Santos told that more extreme ‘halo’ versions of that car are feasible, as Audi seeks to maintain enthusiast appeal during its transition towards a more electrified range. “There are ways we can do this through e-Tron”, he said. “I cannot tell you everything we have planned, and there are some things we haven’t planned to the end anyway. But you can just imagine a completely new platform, MEB, and it would make no sense to have just one derivative, the Q4 e-tron, with one certain range of powertrains. We will extend the portfolio and platform and have some emotional versions”. +++ 

+++ The BEIJING MOTOR SHOW in April will be postponed in the wake of the corona virus outbreak, an official announcement has confirmed. The show’s organisers said: “To ensure the health and safety of exhibitors and participants, we, on behalf of the Organizing Committee of the 2020 (16th) Beijing International Automobile Exhibition (Auto China 2020), have decided to postpone the event which was initially scheduled at the new and old venues of China International Exhibition Center (CIEC) in Beijing from April 21 to 30 this year. The rescheduled date will be notified separately”. This latest move follows the postponed Formula 1 race in Shanghai and the cancelled Mobile World Congress technology show in Barcelona. With travel bans in place, international flights on hold and the streets of Beijing being regularly treated with chemicals in an attempt to halt the spread of the virus, the decision makes sense. Postponement of the show will be a blow to a Chinese car industry that’s struggling to recover from 2 successive market drops in 2018 and 2019. China remains the world’s biggest market for new cars, with 22.3 million registered last year. Until 2018, it had enjoyed 20 years of unparalled growth since the last decline in 1997. The Beijing and Shanghai motor shows have both expanded to become internationally significant, and they alternate on the calendar. Beijing receives around 800.000 visitors each year (about 5.500 of them from overseas) and hosts some 1.200 exhibitors from 14 regions. The organisers of next month’s Geneva motor show say they are monitoring the situation but their show is going ahead as planned. “So far, there are no cancelations of an exhibitor or a partner”, said a spokesperson. “But of course we’re analysing the situation and discussing it with our medical advisors”. The Mobile World Congress (MWC), which attracts 100.000 visitors from 200 countries, was officially cancelled last week just 10 days before it was due to open. Even though the organisers announced a string of measures to reassure attendees, including a ban on visitors from Hubei province and passport checks for evidence of recent travel to China, major exhibitors started to pull out. “With due regard to the safe and healthy environment in Barcelona, MWC is cancelled because of global concern over the coronavirus outbreak”, said a statement from MWC. +++ 

+++ Auto sales in CHINA fell 18 % year-on-year in January; the 19th consecutive month of decline, and the country’s leading industry association expects the short-term prospects to be even gloomier, as the novel coronavirus outbreak continues. Carmakers delivered 1.94 million vehicles in January; 27 % less than in December. Passenger vehicles, which accounted for the majority of overall vehicles, stood at 1.61 million; down 20.2 % year-on-year. Sales of new energy vehicles plunged 54.4 %; down for a seventh month in a row. BYD sold a total of 25.173 vehicles in the month; down 42.7 % year-on-year. Its new energy vehicles saw an even deeper fall of 75.12 %. Great Wall Motors, China’s largest SUV maker, saw its January sales fall 28.6 % to 80.261. The association said the sales falls were primarily the result of the Spring Festival holiday, which meant there were only 17 working days in the month. It said the novel corona virus, which started to spread outside of Hubei province around January 20, had limited effects on the lackluster performance in January. However, the association’s poll of around 300 carmakers and auto suppliers showed they expected the epidemic to wreak more havoc in the short term on auto sales and production than the 2002-2003 SARS outbreak. China extended this year’s Spring Festival holiday, and local governments have imposed travel restrictions and warned residents to avoid public spaces. Many will work from home for several weeks before they go back to their offices. “It will have a lot of effects on the Chinese auto industry, which is undergoing a transformation. The epidemic will see slashed demand in the short run”, said Chen Shihua, deputy secretary-general of the association. Just a third of China’s 183 car manufacturing plants had resumed production. Hubei, the epicenter of the epidemic, is responsible for around 9 % of China’s car manufacturing. So far carmakers in the province have postponed all production. Some industry executives including Volvo CEO Håkan Samuelson said they could recoup lost production throughout the rest of the year. Ford said it is too early to estimate the implications of the novel corona virus on its business. A poll by the China Automobile Dealers Association showed that dealers in the country predicted China’s car sales to fall 50 % to 80 % year-on-year in February. Some 70 % of dealers polled said they had seen “almost no customers” since the end of January. Xu Haidong, vice-chief engineer of the CAAM, said sales in the first quarter will be greatly impacted but he expected a short-term rebound when the epidemic is over. Those who don’t have a car may decide they need a car in case of emergencies, he said. Xu added, though, there is little room for optimism for whole-year performance in 2020. The association warned before the outbreak that automakers need to get used to a new normal of “low speed growth” in China. It predicted last month that sales are likely to shrink 2 % year-on-year this year, after an 8.2 % fall in 2019 and a 2.8 % dip in 2018. Shi Jianhua, deputy secretary-general of the CAAM, said he does not believe the epidemic will have lasting effects on China’s automotive industry. “The auto industry will not be insulated from the novel coronavirus, but its long-term trend of stable growth will not change because the Chinese economic fundamentals are sound”, he said. +++ 

+++ The spread of the CORONA VIRUS could undermine almost every car maker’s plans to hit the European Union’s 2020 emissions targets, Kia Europe’s chief operating officer has warned. While all car makers have individual targets based on their product mix to hit, they must all achieve average fleet CO2 emissions of around 95 g/km for cars sold this year, necessitating that most sell significant numbers of hybrid, plug-in hybrid and electric cars unless they can find other ways to offset their figures, such as buying super-credits from rival car makers. However, Emilio Herrera highlighted that any production delays resulting from shutdowns as a result of the spread of coronavirus could undermine the plans laid down in advance. “Our planning to hit the targets has been many years in the making, but coronavirus is a curveball that of course nobody has factored in”, he said. “Today we don’t know the impact, but it could be that the whole industry is left in a position where it cannot fulfil the sales necessary and we have to go to the EU and plead for force majeure”. The virus outbreak has already led to factory closures across Asia, including in Kia’s home of South Korea, while European car makers have also warned of delays as a result of shutdowns among their networks of suppliers. “We are not at the point yet where our plans will be disrupted to a point where we can’t fulfil our promise to hit the EU target”. said Herrera, “but there is a potential worst-case scenario that we have to be prepared for. I just hope we don’t have to go there”. +++ 

+++ FORD has confirmed that the new Puma will be recalled, and deliveries have been halted, due to a potential airbag component problem. The Nissan Juke rival only went on sale late last year, with some buyers of the initially prioritised First Edition models taking delivery last month. However, Ford has stated deliveries have been postponed due to an airbag fault. Ford’s statement reads: “A number of Puma vehicles have been built with driver’s airbag retention springs that may be outside of Ford Motor Company manufacturing specification. Under certain conditions, it is possible that the airbag is not retained in the steering wheel after it has been deployed. The performance of the airbag in case of an accident with airbag deployment will still meet regulatory requirements and provides sufficient protection for the driver. Ford has issued a sales hold of all affected vehicles in dealer stock and will immediately exchange the airbag retention spring. A safety recall of all affected vehicles with customers will follow immediately”. It’s to yet clear how many examples of the Puma have been delivered to customers. +++ 

+++ GENERAL MOTORS ‘ decision to pull out of Australia, New Zealand and Thailand as part of a strategy to exit markets that don’t produce adequate returns on investments raised dismay from officials concerned over job losses. The company said in a statement that plans to wind down sales, engineering and design operations for its historic Holden brand in Australia and New Zealand in 2021. It also plans to sell its Rayong factory in Thailand to China’s Great Wall Motors and withdraw the Chevrolet brand from Thailand by the end of this year. “This is a very disappointing outcome”, said Karen Andrews, Australia’s minister for Industry, Science and Technology. She said it was unfortunate both because about 500 workers would lose their jobs, but also because “they only advised the government of this decision just before the announcement”. Dave Smith of the Australian Manufacturing Workers’ Union also expressed chagrin. Workers at Holden had thought they’d “been through the worst of it, and that’s not the case”, Smith said. “For many of them their long-term workers have been very loyal to the company. They’ve loved being part of the car industry, and now, it was such an iconic brand coming to an end; it’ll mean an end to their jobs”. GM has 828 employees in Australia and New Zealand and another 1.500 in Thailand, the company said. In Thailand, the decision to sell GM’s plant in Rayong, south of Bangkok, may well end up being good news for workers there. Great Wall Motors, a major maker of SUVs and pickups, said it intends to expand in Southeast Asia using the plant in Thailand as its base. “We will also promote the development of the local supply chain, research and development and related industries, plus contribute more to the exchequer of both the local Rayong and Thailand governments”, Great Wall’s vice president for global strategy, Liu Xiangshang. Liu said the Thai expansion was part of Great Wall’s global push, following the launch of a plant in Tula in Russia in 2019 and plans to acquire GM’s Talegaon plant in India. GM said it had analyzed the business case for future production at the Rayong plant, but low utilization of its capacity and low sales volumes “made continued GM production at the site unsustainable”. GM has struggled in Asia in the past year. Its International Operations, which include China, lost $200 million last year, including $100 million in the 4th quarter. GM’s CEO, Mary Barra, said the company wants to focus on markets where it can drive strong returns, scaling back operations in Australia, New Zealand and Thailand to selling niche specialty vehicles. GM will support its employees and customers in the transition, she said. GM is making the same moves in Japan, Russia and Europe, where “we don’t have significant scale”, she said. “We are pursuing a niche presence by selling profitable high-end imported vehicles supported by a lean GM structure”, International Operations senior vice president Julian Blissett said in the statement. GM said it will honor all warranties in the markets, and it will continue to provide service and parts. Local operations also will handle recalls and any safety-related issues, the company said. The Detroit automaker expects to take $1.1 billion worth of cash and noncash charges this year as it cuts operations in the 3 countries. GM has a long history in Australia with the Holden brand, where cars were designed and sold in the U.S. and other markets. The 2008 and 2009 Pontiac G8 muscle car, for instance, was designed as a Holden Commodore and built in Australia. But Holden’s market share, which was nearly 22 % in 2002, fell to just over 4 % last year. GM President Mark Reuss, who once ran the Australian operations, said the company explored options to continue Holden, “but none could overcome the challenges of the investments needed for the highly fragmented right-hand-drive market, the economics to support growing the brand, and delivering an appropriate return on investment”, he said in the statement. +++ 

+++ China’s GREAT WALL MOTORS said it had signed a binding agreement to purchase a car plant from General Motors in Thailand. According to a binding agreement inked by the 2 companies, the transaction and handover, which include a car plant and a power assembly plant in Rayong currently operated by the Detroit carmaker, are expected to be completed by the end of 2020. As a regional manufacturing center, the Rayong plant has produced nearly 1.4 million cars since it went operational in 2000. It will be the Great Wall’s 11th full-process complete vehicle manufacturing base globally, the third outside China, following a plant in Russia’s Tula region which was put into operation in June 2019 and another one in Talegaon, India, bought from General Motors earlier this year. Liu Xiangshang, the Great Wall’s global strategy vice president, said the purchase will boost the company’s development in the Thailand and ASEAN markets and help export products to other ASEAN nations and countries like Australia. “The ASEAN automotive market is developing with great prospects and potential”, Liu said. “Our investment will create more jobs for the locals, improve their skills and stimulate supporting, R&D and related industries there”. Headquartered in the city of Baoding, northern China’s Hebei province, the company owns several SUV and car brands like Haval, Great Wall, WEY and ORA. With more than 500 overseas branches, its products have been exported to over 60 countries and regions including those along the Belt and Road. +++ 

+++ Ralf Speth, the outgoing boss of JAGUAR LAND ROVER , can chalk up a career that transformed the British automaker. But Speth, 64, leaves behind significant challenges for his successor, who will be named this year. Chief among them: improving quality. Speth, a German-born engineer who was appointed an honorary Knight Commander of the Order of the British Empire in 2015, will step down from his role at the British automaker in September. He has been CEO since 2010 and has helped shape Jaguar Land Rover during its modern era under the ownership of India’s Tata Motors. Under Speth, JLR saw a stream of investments in product development and manufacturing. In the Speth era, JLR introduced the F-Type, Jaguar’s first true sports car since the 1960s. It took the Range Rover brand into a new segment with the compact Evoque, which propelled JLR to record global sales. It beat bigger rivals to market with battery-powered crossovers with the Jaguar I-Pace, which has garnered a number of industry awards. It approved an all-new version of the iconic Land Rover Defender, which is launching now. JLR became a global automaker by opening plants in China, Eastern Europe and South America. It began building its own engines again. But despite Speth’s achievements, the luxury automaker has continued to struggle with quality; something his successor will now have to face. Quality problems are a legacy that predated Speth, a former BMW executive. The issue goes back to Jaguar and Land Rover’s ownership by British Leyland in the 1960s, and later under Ford ownership, before their 2008 sale to Tata. But under Speth, fast-growing Jaguar Land Rover made little improvement in its quality ratings. Quality concerns hampered the company’s growth in China, where angry consumers were so frustrated with their vehicles in 2018 that they protested in front of the company’s headquarters in Shanghai. 2 years ago, JLR installed Nigel Blenkinsop as director of quality and automotive safety. JLR began making gains last year in the J.D. Power and Associates Initial Quality Study, but is still far behind on dependability, according to Power. Neither Jaguar nor Land Rover is close to the industry’s top tier, although that ranking is true of all European brands, according to J.D. Power. Ford used the slogan “Quality is Job 1” from 1981 to 1998 to reassure the public of its product quality. For Speth’s successor, a relentless focus on improving quality might require giving Blenkinsop whatever resources he needs to make sure that Jaguar and Land Rovers brake but don’t break. +++ 

+++ KIA aims for tough elegance with the redesigned Sorento, releasing first official images of the vehicle that reflect what the brand calls “refined boldness”. Photos released by Kia show a chiseled exterior with sculpted creasing and a plush interior centered around an optional 12.3 inch high-resolution instrument cluster. The brand’s trademark tiger nose grille also gets tweaked, wrapping widely around the front and enveloping the integrated headlamps on both sides. Kia said the headlamps also get a new LED daytime running light treatment that outlines the main headlight and imbues the “intense impression of the lines around a tiger’s eyes”. Kia designers also reworked the proportions of the upcoming Sorento to make it appear longer with shorter front and rear overhangs and a longer wheelbase. They also pulled the A-pillar back from the front axle, giving the cabin a more rear-slung stance. The next-generation Sorento makes its public debut on March 3 at the Geneva auto show. Expected to arrive for the 2021 model year, the redesigned Sorento is part of a wider push by Kia and its South Korean sibling brand Hyundai to prioritize crossovers and SUVs. The Sorento slots under the top-shelf, 3-row Telluride which was new for 2020 and is a linchpin of the automaker’s American 5-nameplate SUV lineup. U.S. sales of the outgoing Sorento fell 11 % to 95.951 units in 2019, but the U.S.-made SUV was still Kia’s No. 3 nameplate behind the Soul and Optima. Kia says it hopes to boost sales with a more refined interior, replete with the huge digital display. “One of the highest quality interior spaces found in any Kia to date”, Kia said, “the intuitive, tech-oriented cabin of the new Sorento retains the spaciousness and three-row versatility that has characterized the Sorento over its 18-year existence”. Sorento sales in Europe fell by 2.8 % to 9.980 last year. Kia’s overall sales grew by 1.7 % to 498.410. +++ 

+++ Count former GM, Ford and Chrysler exec Bob LUTZ among those who just can’t figure out why Tesla stock skyrocketed more than 250 % over the past 6 months. During a recent interview, Lutz argued that Wall Street’s brightest minds can’t figure this out either, saying that this is a psychology-driven phenomenon. “I talked to people at Goldman Sachs, who are usually the world’s greatest experts on explaining stock prices, and they’re now asking me whether I have any idea what the heck is going on with Tesla stock”, said Lutz. “Nobody can explain it, it’s so far beyond any fundamental return that any shareholder could ever expect”. With a market cap of $145 billion, Tesla is now worth more than Ford, Chrysler and GM combined. “It’s driven purely by psychology or almost a mass psychosis”, added Lutz, who also thinks that this bull run won’t last. “Ultimately, the share price responds to financial fundamental reality, and that day will come”. During the interview, Lutz couldn’t pass up another chance to take a swing at electric vehicles, saying that the shift from conventional cars to EVs is “somewhat of a fiction”, and that global demand for electric power is largely fueled by government subsidies. While Lutz is clearly not a big fan of the electric car industry, he did throw some praise at Tesla’s actual products, saying: “There’s nothing wrong with the car. It is one of the best-driving, best-performing, best-looking premium sedans in the world”. +++ 

+++ The roadmap to MASERATI ’s future has always been fluid. In 2018, the automaker set out to replace aging models with new ones while bolstering its lineup. But a year later, Maserati threw that out the window for a plan that saw refreshes instead of redesigns; at least right away. It was also our first hint the Italian automaker would introduce a new SUV for 2021, a year earlier than previously expected. Today, buried in Maserati’s announcement of a new electrified range, is news that the first pre-production models of its new SUV will roll off the assembly line by the end of the year, which solidifies 2021 as when we’ll see the new Maserati arrive. Details about the new SUV are still scarce though we do know the automaker will invest €800 million into the construction of the new production line. Construction on the new assembly line is scheduled to begin by the end of the first quarter of the year. We could see a concept or the production version of the SUV soon if Maserati is planning to have the first pre-production models rolling off the assembly line by the end of the year. And soon could be May. Late last year, Maserati teased that something could happen in May 2020. At the time, we hoped it’d be the long-awaited Alfieri sports car. However, it could be any new Maserati product – or products – the automaker is preparing to reveal. Though the May event could be something more significant, too, where “past and future will meet to place Maserati firmly on the world stage for the future of mobility”. The new Maserati SUV will slot below the Levante in the automaker’s lineup when it does arrive. Moving the SUV up a year was a smart move by Maserati as consumers continue to love crossovers and SUVs over saloons and sports cars. Maserati has felt a bit lost over the last couple of years, but it sounds like the automaker has big plans going forward, which we should see later this year. +++ 

+++ MAZDA has resumed operations at a vehicle plant in Nanjing in Jiangsu Province, China, following a suspension due to the coronavirus outbreak. Production, however, will be limited due to a shortfall of workers available, company officials said, adding that parts stored in inventories will be used for the time being. The Japanese automaker will temporarily halt production of some models in Japan, due chiefly to delays in parts supplies. The impact of the suspension will be small because the move does not involve a shutdown of production lines, a Mazda public relations official said. Mitsubishi has postponed the restart of operations at its vehicle plant in Changsha in China’s Hunan Province from the previous plan to February 27 or later, due chiefly to delays in parts procurement, informed sources said. There has been no impact on Mitsubishi’s production outside of China. +++ 

+++ NISSAN ’s new CEO Makoto Uchida doesn’t have time to work his way into the job. He is effectively on probation and has a matter of months to show he can revive the ailing automaker, according to three people familiar with the thinking of some on the company’s board. The mission: The new boss must prove to the board he can accelerate cost-cutting and rebuild profits at the 86-year-old Japanese giant, and that he has the right strategy to repair its partnership with Renault. The pressure intensified when Nissan, which has had a year of turmoil since the arrest and sacking of longtime leader Carlos Ghosn, posted its first quarterly net loss in nearly a decade and slashed its annual profit forecast. One of the people familiar with the intentions of some on Nissan’s 10-member board said an assessment of Uchida’s efforts and a decision on his future would likely be made toward the middle of the year. “Probation is more or less the right way to describe the situation Uchida is faced with, if not more serious”, the source said this week. “In the worst-case scenario he could be shown the door”. Uchida referred queries to Nissan about whether he had just months to demonstrate he could turn the carmaker around, whether board members were satisfied with his work, and his relationship with other senior executives. The company rejected suggestions of Uchida’s uncertain circumstances as having “no factual basis”. “Effectively or otherwise, Uchida is absolutely not on probation”, a Yokohama-based spokesman added. “There does not exist such a concept or system within Nissan to put a CEO on probation. He is CEO”. Some supporters also stressed that Uchida has only been in the top job for little more than 2 months, while Nissan’s business has been in decline since 2017. Executives and analysts have previously said the company’s current woes are not of Uchida’s making, but are the fallout from an aggressive and poorly executed global expansion under Ghosn and Uchida’s predecessor, Hiroto Saikawa. “Nissan is on the right path for recovery, although it might be a gradual process”, Uchida, formerly Nissan’s China chief, said in a video message to employees in October, shortly after being named CEO. Still, it has been a difficult start for the new CEO, who officially took the helm at the beginning of December and must act swiftly to counter a slide in sales that is accelerating in key markets like the United States and China. When he took the stage at corporate headquarters in Yokohama early that month, Uchida billed himself and his senior leaders (No. 2 Ashwani Gupta and No. 3 Jun Seki) as a tight “one team” that could deliver a bright new dawn for the automaker. Later in December, 2 board members sat down with Uchida (whose elevation has been opposed in some quarters) to tell him he needed to consult more with Seki and Gupta, stressing he had been given the top job on the condition that he worked closely with the pair, according to 2 of the sources. The “one team” hasn’t shown much unity, though. Seki resigned in late December and joined electric motor producer Nidec Corp. as president. Chief operating officer Gupta, meanwhile, has griped privately to colleagues about having a dysfunctional working relationship with the new CEO, according to 2 of the sources, but he is committed to work with Uchida to turn Nissan around. One source said the board would not brook internal squabbles or procrastination among Uchida, Gupta and the rest of the executive team: “The biggest problem is nothing getting done, at a time when we need to take decisive actions”. Gupta referred queries to Nissan, which said Uchida and Gupta were “cooperating closely, sharing information, and are engaged with executing the performance recovery plan and other reform moves, including fixed cost-cutting”. Nissan, Japan’s second-biggest automaker after Toyota, faces an array of structural woes, from high fixed costs to weak management to a strained partnership with Renault, which began unraveling after Ghosn’s arrest in late 2018. The problems come at a pivotal time when Nissan and other automakers are attempting to come to grips with a major, and costly, technological shift towards electric and self-driving vehicles. The carmaker posted a net loss of ¥26.1 billion ($238 million) for the October-December third quarter and it cut its annual operating profit forecast by 43% to ¥85 billion. Though Nissan expects to report a small profit for the year ending in March, some executives are worried it could post a loss, according to the sources, especially given the fact that the forecast does not take into account the impact on sales in China and beyond from the coronavirus outbreak. Uchida said, at the earnings media conference on Thursday, that Nissan was looking at the possibility of accelerating existing restructuring plans, as well as implementing additional measures, but he added the company would not be able to provide details of those extra steps until May. Uchida replaced Saikawa, who resigned in September after admitting to being improperly overpaid. His appointment was contentious, with some members of the board’s 6-strong nomination committee pushing for Seki or Gupta, according to 2 of the sources. Seki, in fact, garnered the most first-choice votes (3) but not a majority, leading to another round where second preferences were taken into account, Uchida received 5 second-choice votes so won the job, the people said. By mid-January, however, some board members were starting to regret the decision, said the sources. While Uchida had touted a fresh start in his speech in December, he has still not publicly spelled out specifics on strategy. Some members of the board complained that he was even sitting on some of the turnaround measures hammered out by Nissan executives last year, before he took the reins of the company, the sources said. A team led by Seki, and charged with formulating a series of turnaround measures, had proposed effectively pulling out of Indonesia, where the Nissan group’s market share fell below 2 % in 2018, according to a separate source close to that team. Under the plan, the company would ask partner Mitsubishi, an SUV powerhouse in Southeast Asia, to contract-manufacture Nissan cars and help market them in Indonesia, the person said. When Uchida became CEO, however, he struck a cautious stance and made no decisions on that proposed pullout, though the idea has more recently began gaining momentum after much prodding by Uchida’s subordinates and the board, according to the source. In November, Seki’s team also suggested Nissan go into a more intense “crisis mode”, significantly stepping up spending cuts, including sizable reductions in year-end bonuses for top executives, said the source, adding that the proposals had not been implemented under Uchida. +++ 

+++ With the POLESTAR 2 featuring a “vegan interior”, the Swedish brand decided to further focus its attention on full-circle sustainability for its vehicles in a bid to reduce weight, cut plastic content and lessen waste material by using natural and recycled materials. For example, Bcomp’s powerRibs and ampliTex technologies can turn natural fibers into lightweight interior panels for cars. Such a bio-material is said to be ideal for use in crop rotation programs. “It’s clear that to be truly sustainable we have to evaluate every element that goes into our cars”, said Thomas Ingenlath, Polestar CEO. “For Polestar, sustainability is not just about the electric powertrain. With the development of these innovative new solutions that we will introduce in our future cars we make a strong statement of our intentions”. For the seats, a 3D-knit material can be implemented in a way that reduces waste and promotes recycled material sources. This works thanks to a single thread being used to produce the three-dimensional individual components, while the base material is 100 % recycled yarn derived from PET bottles. Both the wine and fishing industries can contribute too, with cork and fishing nets being recycled and incorporated within car interiors. For example, waste material from the cork manufacturing process can be integrated into PVC interior componentry, while recycled Nylon 6 (derived from discarded fishing nets) can be turned into woven carpets. “Importantly, we don’t need to sacrifice design and luxury with these materials”, said Polestar design boss Maximilian Missoni. “If anything, they enable even more premium, cutting-edge, modern and stylish executions which elevate our design-led products. It also presents a positive challenge, giving new meaning to interior design. We are able to derive new aesthetics from new contexts and technologies, allowing society to move on”. +++ 

+++ Frank-Steffen Walliser is PORSCHE ’s head of motorsport, and he alluded to the idea that the manufacturer is seriously considering a battery-powered 718. We already know of plans to launch an all-electric version of the Macan, but it’s the first time a high-ranking Porsche official goes on record to talk about what could end up being called the E-718. The Porsche motorsport boss was recently interviewed in order to obtain information about the specifics of the company’s electrification plans. Walliser immediately denied the possibility that there will be a plug-in hybrid 718, arguing that it would make the brand’s entry-level sports car too complex, expensive and heavy: he said it’s only a solution for the Cayenne and Panamera (indirectly suggesting the 911 is not suited to becoming a PHEV either). He went on to say that an all-electric 718 would make a lot more sense, given that they could slot batteries in the middle of the car, in the space where the internal combustion engine would normally sit. Putting the batteries in the floor – a staple of pretty much all good EVs nowadays – is not really an option for an electric sports car, because it would compromise the low driving position, according to Walliser. Making the car would pose a challenge for the manufacturer, but he seemed optimistic about the prospect. The car would have a projected WLTP range of around 500 kilometres and weigh some 200 kilograms more than a petrol-burning 718, for a grand total of around 1.700 kilograms. Walliser adds that even with the extra weight, the car would still perform as is expected from a Porsche sports car (not that we needed any convincing, after seeing what the nearly 2.5-ton Taycan is capable of). Rear-wheel drive-only versions would be possible, but it also sounds like all-wheel drive is also in the cards for the E-718. Last point mentioned is that since the 718’s main market now is China, where it is bought almost exclusively by people who live in heavily polluted megacities, making it all-electric would definitely make sense. And since China is such a big market, one where EV uptake is rising rapidly along with citizens’ purchasing power, we just might see this model debut sooner than we expect – maybe this is what the Porsche engineer quoted by Chris Harris on Top Gear was talking about. +++ 

+++ RENAULT reported its first loss in a decade and cut its 2020 margin target, as it attempts to draw a line under the Carlos Ghosn affair and reboot its Nissan alliance. The French carmaker is trying to move on from the internal turmoil sparked by the scandal involving its former boss Ghosn with a management shake-up. Meanwhile, it is also grappling like other automakers, including Nissan, with tumbling auto demand in some key markets like China. “It has been a tough year for Groupe Renault and the alliance”, acting chief executive Clotilde Delbos told a conference call, adding that the broader autos downturn had hit the company “right when we were facing internal difficulties”. Renault posted a loss of €141 million for the group share of net income, in part as a result of charges linked to some of its Chinese joint ventures. The contribution from Nissan, in which Renault has a 43 % stake, also fell and it was hit by a French deferred tax charge. Nissan this week had its first quarterly loss in nearly 10 years and cut its operating profit forecast. Renault set a 2020 operating margin target of between 3 % and 4 %; down from 4.8 % in 2019, and sliced its proposed dividend against 2019 by almost 70 % from a year earlier. Luca de Meo, who used to run Volkswagen’s Seat brand, is set to join as CEO in July, taking over from Delbos, who is also Renault’s financial chief. She stepped into the CEO role on an interim basis after Thierry Bollore, a long-standing Ghosn ally, was ousted in October. Ghosn, who ran Renault and oversaw its alliance with Nissan, was arrested in Japan in late 2018 on financial misconduct charges, but fled to Lebanon in December. He has denied wrongdoing and hit out at his past employers, saying the Renault-Nissan alliance was all but dead without him. Renault executives repeated assurances that the Nissan alliance was on track. Delbos acknowledged that investors were still sceptical, but said that the firms would provide meatier joint goals by May. Carmakers have posted contrasting performances in an industry hobbled by falling global demand, squeezed by high investment costs for cleaner models, and now facing supply chain problems due to China’s coronavirus outbreak. However, Italy’s Fiat Chrysler Automobiles posted higher 4th quarter profit due to a strong North American business. Renault forecast that the global auto market would fall in 2020, with sales in Europe and Russia down around 3 %. It stumbled in several countries, including Argentina, and said it needed to fix its operations in China, where it has a partnership with Dongfeng on electric vehicles and with Brilliance China Automotive Holdings on commercial cars. Renault said its goals did not take into account possible impacts from the corona virus crisis in China, where it has a factory in Wuhan, the epicentre of the epidemic, which has been in lockdown to contain the spread of the virus. It has also suspended operations for at least four days at its South Korean subsidiary due to supply chain hiccups. Renault’s group sales fell 3.3 % to €55.53 billion in 2019, beating an average €55.24 billion forecast expected by 20 analysts. Sales were down 2.7 % at constant exchange rates. +++ 

+++ As Lincoln’s parent company Ford is simply following the crossover / SUV trend, the luxury brand is only left with 2 SEDANS in its lineup: the MKZ and Continental. However, the first one will be retired for good this year, while the flagship 4-door is tipped to live on until 2021. This will leave Lincoln without any sedans in its lineup, a situation that has annoyed dealers. Lincoln National Dealer Council chairman Tom Lynch said: “The Council continues to talk to the company about still needing to be in the sedan business. You only have to look at Tesla. If you have a strong product, people are going to want it, and they’re going to buy it. What that looks like for Lincoln going forward, I’m not sure of”. While the future looks dark for 4-door Lincolns, these haven’t been doing that well in the recent years. In 2019, U.S. deliveries of the MKZ saw an 11 % drop to 17.725 deliveries and the larger Continental did even worse: 6.586 units sold; down 25 %. That’s despite reviving the Coach Door Edition for the 2020 modelyear, which created quite a buzz. The number represents a small fraction of Lincoln’s sales last year, which was 112.204 vehicles; up from 2018’s 103.587. Even with the imminent demise of the MKZ and Continental, Lincoln would still be left with a strong SUV lineup that counts the MKC, Corsair, Nautilus, Aviator and Navigator. +++ 

+++ The respective ranges of the TESLA Model S Long Range and Tesla Model X Long Range have both been increased through some hardware and software updates. A look at the website reveals that the Model S Long Range is now rated at an EPA-estimated 628 km; a 4.6 % increase over the 600 km it was previously rated at. Similarly, the Model X Long Range now has an EPA-estimated range of 565 km; 7 % more than the 528 km previously. Taking to Twitter, Tesla chief executive Elon Musk said the increased ranges are due to “many small hardware improvements throughout the car that have been introduced gradually over past several months. Software just thinks the car is less efficient than it actually is”. Musk went on to add that 640 km might be achievable with a new set of wheels and tires Tesla could be developing for all previously-produced vehicles. There’s a strong possibility that the range of future Tesla models will be even greater than 640 km. After all, the second-generation Tesla Roadster has been promised to support a 200 kWh battery that will allow it to travel some 1.000 km on a single charge. Before that model hits the market, however, it is possible that Tesla could introduce a 120 kWh battery option for the Model S and Model X, as has been rumored in recent weeks. +++ 

+++ Europeans are not getting the TOYOTA Supra with its new 390 hp output. The stricter emissions regulations here mean that the company can’t offer the higher-output powertrain. The 3.0-litre inline-6 turbocharged engine continues to produce 340 hp in Europe. Toyota said that the changes to the engine included adding a dual-branch exhaust manifold with 6 ports instead of 2. The company also fitted new pistons. The improved power cut the estimated acceleration to 96 kph to 3.9 seconds, rather than 4.1 seconds previously. The 2021 modelyear Supra has more than just a power upgrade, and it’s not clear at this time whether these improvements would be available on the European model. Toyota tweaks the damper tuning and fits aluminium braces that connect to the strut towers to the radiator support. There are also programming changes for the power steering, adaptive suspension, stability control, and active rear differential. +++ 

+++ The lira crash came and went more than a year ago in TURKEY but it left behind a surprising hedge against inflation and falling interest rates in the form of a run on secondhand cars. Millions of Turks have been snapping up used cars, sending their prices surging at a time when inflation and currency depreciation were eating away at savings. Over the past 2 years, the average price of gasoline-powered cars more than doubled and went up 120 % for diesel vehicles, which are more popular in Turkey. The aftermath of a currency crash that erased almost a third of the lira’s value in 2018 gets the credit (or the blame, depending on the perspective) for the boom times. Not knowing when the crisis would end, businesses dealing in new cars did not make enough fresh orders to replenish inventories after depleting their stocks, according to Sami Nacaroglu, who runs a website that sells used cars. Once rates began to fall and demand from consumers surged, Turkey did not have enough new cars to go around. In December, used cars accounted for 95 % of all cars sold in Turkey. “I’ve been in the secondhand car business for 11 years and I’ve never seen anything like this”, Nacaroglu said. Turkish President Recep Tayyip Erdogan even boasted this week of gains in new car purchases as a sign the economy is back on track after a recession. But it’s secondhand cars that are going at a scorching pace, with 6.23 million units bought last year; a fifth more than in 2017, the year before the currency meltdown. By contrast, sales of new vehicles actually shrank by almost half in the same period to about 387.000. Financing is easy to get for anyone short on cash. The central bank has more than halved benchmark borrowing costs since Erdogan’s abrupt appointment of a new governor in July, dragging deposit and loan rates lower. The average annual rate on car loans has plunged by more than 20 percentage points since September 2018 to under 14 % at the end of January. In combination with a more stable lira, used cars are often the purchase of choice, even if it means buying into the price frenzy. Although prices of both new and used vehicles have crept higher, Turks are overwhelmingly opting for second-hand cars. The reason is partly because new cars require a bigger initial investment and then lose value more rapidly. The market is so distorted that second-hand prices have become comparable with the cost of brand-new vehicles. “Even with today’s high prices, I don’t think clients who buy used cars would lose money”, Nacaroglu said. “This may have indeed turned into an instrument to invest”. The bonanza may not last for too much longer. For now, the high price tags on new cars, and their scarcity, are driving up demand, said Toygun Onaran, head of equity research at Istanbul-based Oyak Securities in Istanbul. “However, it wouldn’t be right to see it as an investment tool”, Onaran said. “Should the prices of new cars be appealing and their supply increase, then we’ll most likely see a retreat in the used-car market”. +++ 

+++ Geely and VOLVO Cars, both subsidiaries of Zhejiang Geely Holding Group, are planning to merge their businesses, a move that is expected to create the country’s first truly global and most valuable carmaker. The 2 companies said on Monday they will create a joint working group to prepare a proposal for their respective boards but did not give a specific schedule. The merger would accelerate financial and technological synergies between the 2 companies and creates the scale, knowledge and resources for the business to become a leader in the ongoing transformation of the automotive industry, they said. “A combination of the 2 companies would result in a strong global group”, said Li Shufu, chairman of Zhejiang Geely Holding Group, in a statement. He said the goal is to strengthen synergies while maintaining competitive advantages and the integrity of each individual brand. After the merger, the new company will feature 5 brands: Volvo, Geely, Lynk & Co, Polestar and Geometry, covering affordable sedans to premium SUVs and electric vehicles. The plants and sales networks of those brands in Europe, China and the United States will mark the emergence of China’s first global carmaker. Analysts at Bernstein said, “Strategically the deal feels like, after years of deal-making, a first move by chairman Li Shufu to consolidate his sprawling automotive empire”. Li purchased Volvo from Ford in 2010. His holding group also owns London Electric Vehicle, a 49.9 % stake in Malaysia’s Proton, a majority stake in British sportscar brand Lotus and a 9.7 % stake in Mercedes-Benz parent Daimler. BOCOM International, the securities and financial service arm of Bank of Communications, said the merger will help Geely and Volvo cut research and development costs on new powertrain systems and other technologies. Last October, Volvo said it would merge its engine development and manufacturing assets with those of Geely, creating a division to supply Lotus, London Electric Vehicle Co, Lynk & Co and Proton, and also potential competitors with next-generation combustion and hybrid engines. BOCOM International said the merger will also improve the image of Geely vehicles in international markets thanks to Volvo’s reputation. The Swedish carmaker’s network resources can facilitate brands, especially Lynk& Co, to make forays into European markets. The 2 companies said the merged company will have access to the global capital market through the Hong Kong stock exchange and possibly in Stockholm as well. It remains unclear how much value would be added to the Hong Kong-listed Geely by injecting Volvo assets. Following the announcement, its stock price rose 5.7 %, with a total valuation of $19 billion. Volvo and its parent group had been discussing an initial public offering to value the carmaker at between $16 billion and $30 billion before they dropped the listing plan in 2018. Yuan Xiaolin, senior vice-president of Volvo, said on social media that the merger will create a company that will top the list of Chinese carmakers in valuation. So far the No 1 is Shanghai-listed SAIC Motor, valued at $35.72 billion yuan. He also expected the company to be one of the best-selling carmakers in the world. “One in every 30 vehicles sold globally will be from this new company”, he said. Geely’s sales started to surge from 2015 as its products began incorporating Volvo technology. It sold 1.36 million cars in 2019, as the best-selling Chinese passenger carmaker for three years in a row, and aims to sell 1.4 million cars this year. Volvo sold just over 700.000 cars last year; a record number in its 93-year history. Combined, the 2 sold 2.06 million vehicles, ranking 11th globally in 2019. +++ 

+++ The annual WORLD CAR AWARDS competition is a bit like a breathless horse race that gallops for months through some of the leading motor cities, from Europe and Asia to North America. There are dozens of hopeful runners and riders with varying degrees of talent, experience, energy or prospect of a class or overall win. Of these, we find fearless rookies such as Seat, Skoda and SsangYong; more traditional midfield veterans like General Motors / Cadillac and Ford; then the ‘clear favourites’: Audi usually being one of them because it has so far picked up more World Car trophies (10) than any other car manufacturer on the planet. Yet this company, or to be more precise the 4 cars it put up for contention, fell at the first fence in this year’s race, with no nomination for a class or overall win. America’s wobbly Ford and out-of-touch GM / Cadillac also crashed at the same inaugural hurdle, as did Seat, Skoda plus SsangYong. But it’s Audi’s unprecedented and worryingly early exit from the World Car programme in 2020 that leaves the firm open to question. Is it losing its way? And how come ‘lesser’ brands such as Mini, Peugeot, Toyota and Volkswagen confidently trotted through to the next stage when Audi couldn’t? Is Germany’s grip on the design and production of affordable, desirable, small to mid-sized cars weakening? With 4 German overall finalists, not quite, but Opel is out of the running, so things could be rosier. At the same time, is Japan also on the decline? Apart from Mazda and Toyota (the Supra is a World Performance Car finalist), it would appear so; not least because these are the only Japanese firms still in the running, having cantered through the Delhi Auto Expo at the start of this month before stopping at next month’s Geneva Motor Show, prior to the final furlong and prize-giving at April’s New York Auto Show. Embarrassingly, Honda, Lexus, Mitsubishi, Nissan, Subaru and Suzuki all failed to build new qualifying models for the world, so were (and still are) red-faced non-starters this time. Close neighbour South Korea boasts a different, more positive story because it has 3 Kias and 2 Hyundais in the tournament. The biggest World Car Awards prize is the overall World Car of the Year (WCOTY) gong, which is independently rated the No 1 automotive prize on the planet. And although Germany has 4 contenders in the WCOTY Top 10 (the Mercedes CLA and GLB, plus Volkswagen’s new Golf and T-Cross), South Korea has a credible 3 (the Hyundai Sonata, plus Kia’s e-Soul and Telluride), Japan 2 (Mazda 3 and CX-30) and Britain has just 1 (the new Range Rover Evoque). Yup, you read me right: as things stand, for everyday, just-about-affordable cars that hit the spot, the new world order comprises Germany, which clings to the top slot, South Korea that rises to second place, then Japan slipping into third, followed by Britain in fourth and France fifth. The once-great, now-troubled car-producing nation that is the United States of America is well and truly out of the race; in more ways than one. +++

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