Newsflash: Ford na decennia onttroond als marktleider in Groot-Brittannië

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+++ After dipping its toes in SUV waters with the Bentayga more than 4 years ago, BENTLEY is now looking at the future of motoring. Bentley’s head honcho Adrian Hallmark confirmed that it will make an electric car and that it will arrive on the market in mid-2020s. Why so late, when nearly every major automaker has already started experimenting with zero emissions mobility? Because of the high cost of batteries, which would significantly affect the price of the car, even a Bentley. “Batteries are 6 times the price of an engine and an engine is 20 % the cost of a car”, said Hallmark. Multiply 20 into 120 percent and the car has doubled in cost. EVs are very expensive today because batteries are expensive”. By Bentley’s estimates, batteries will become more affordable and smaller in 5-6 years and that’s when they’ll take on the task of building a “proper EV”, with “the right wheelbase, right amount of occupants, the right size and shape”. The first production EV could bear the Mulliner moniker and surprisingly it might have a low range but big price tag. Hallmark revealed that “we’ve been asked if we could ‘build a car exactly like an R-Type Continental that’s also fully electric, and I don’t care if it’s got 160 km range, thank you very much’. The answer is ‘yes, we could’. Do we really want to? We haven’t answered that yet”. A fully electric Bentley has already been previewed last year, via the EXP 100 GT Concept. The all-quiet GT packs 4 electric motors for a total system output of 1,340 hp and 1.491 Nm of torque, and a 0-100 kph in 2.5 seconds. At 300 km/h, top speed is worthy of the class and with the new battery tech, it’s expected to be charged to 80 % in just 15 minutes, and have a range of 700 km with a weight of 1.900 kg. On a different note, the British brand has become carbon neutral in their factory operations and wants to become the first in the VW Group and the luxury class to become fully carbon neutral, according to Hallmark. “As a Group we’re fully committed to the 2040 Paris climate accord and we’re committing tens of billions towards it as a group. We’re part of the Group, but we want to be the first there. We’re small, we don’t use a lot of resources. So for us to decarbonize from an organizational or industrial perspective is a way smaller challenge”. +++ 

+++ The BMW iX3 is not coming to the U.S. right now. “At this time we do not have plans to bring the iX3 to the U.S. market”, a BMW spokesperson told. “The next EV to come to the U.S. market will be the iNext, which goes into production in the middle of 2021, followed by the i4, which begins production towards the end of 2021”. However, BMW is currently unable to provide any reasons as to why its new all-electric crossover won’t be launching in the U.S. at this time. That leaves me to speculate. I received the most comprehensive information about the iX3 late last year with a sizable specs dump. Some of the information was a bit head scratching, like the plan to make it rear-wheel-drive-only at launch. American buyers have come to expect all-wheel drive in crossovers and not offering that would be a big sales inhibitor. BMW is also facing serious regulatory pressure in Europe to cut its fleet CO2 emissions and since the iX3 is the first of the new BMW EVs, it makes sense to prioritize sales on that side of the world. This strategy is similar to Mercedes’ EQC plan: that crossover is delayed and won’t launch in the U.S. until 2021. Mercedes claims that European demand for its new electric crossover is high, but it also has to live up to the same emissions expectations as BMW does, or face hefty fines. The iX3 is also being built in China, where we expect sales to begin this year, as production is said to start sometime in 2020. There’s also the question of the iX3’s competitiveness in the U.S. BMW fitted a 74 kWh battery pack to the electric crossover, a battery that’s smaller than both the Audi e-Tron and Jaguar I-Pace. A disappointingly low range number (440 km) would be a serious cause for concern. Keep in mind: that’s only speculation and Audi has gone ahead with the e-Tron with an even lower range. Until the iNext in 2021, it’s looking like there will be no new electric BMWs. More plug-ins will likely arrive between now and then, but the electric version of the hot-selling X3 isn’t on the docket. +++ 

+++ Passenger car retail sales in CHINA , the world’s biggest auto market, fell 80 % in February because of the coronavirus epidemic, one of the country’s industry associations said. “Dealers returned to work gradually in the first 3 weeks of February and their showroom traffic is very low”, the China Passenger Car Association (CPCA) said, adding it expects February’s sales drop will be the steepest of this year. The world’s biggest car market is bracing for further bad news as efforts to curb the spread of the corona virus, which has killed more than 2.900 people in mainland China, disrupts global supply chains and dampens consumer demand. General Motors, China’s second biggest foreign automaker, said the industry will face “serious challenges” in the first quarter this year, but anticipates the situation will ease in the second quarter, its China president Matt Tsien said. GM hopes China’s auto sales will report year-on-year growth in the second half of this year, Tsien added. BAIC sold 1.002 units in February; down by 65.1 % from a year earlier. BYD sold 5.501 cars last month; 79.5 % lower year on year. Geely said its sold 21..168 Geely and Lynk & Co cars last month; 75 % lower than a year earlier. General Motors’ Shanghai joint venture with SAIC Motor sold 7.612 units in February; down 92.2 % year on year. GM’s Guangxi-based venture with SAIC Motor and a local partner sold 11.800 units in February; down 88.1 % year on year. Honda, which has joint ventures with GAC and Hubei-based Dongfeng sold 11.288 units in China last month; down 85.1 % year on year. Volkswagen’s Anhui-based electric vehicle partner JAC sold 11.550 units in February; down by 63.4 % year on year. Nissan, which has a joint venture with Dongfeng, said China sales dropped 80.3 % year on year to 15.111 units in February. China’s biggest automaker SAIC Motor, which has joint ventures with Volkswagen and General Motors, said group sales dropped 86.9 % to 47.365 units last month. Toyota, which has joint ventures with FAW Group and GAC sold 23,800 Toyota and premium Lexus cars, 70.2 % lower year on year. Volkswagen’s Shanghai-based venture with SAIC Motor sold 10.000 cars last month; down 91.0 % year on year. +++ 

+++ The growing number of confirmed coronavirus cases in Germany has raised questions about the vulnerability of long international supply chains to such an epidemic. DAIMLER boss Ola Källenius warned against a return to economic nationalism as a response to the crisis. “These events show how fragile global supply chains are”, he told. “But a world without global work sharing would be less successful. We should protect that success while checking for vulnerabilities where we can bring more security into the supply chain”. He said Daimler was “gradually ramping up” production again in China after the Chinese New Year stoppage, which had been lengthened because of the coronavirus. But the disease would have an impact on company results. “We can’t yet say what the impact will be, but it is clear that both production and sales will be affected”, Källenius said. Germany reported 210 new confirmed cases of the coronavirus, the Robert Koch Institute said. The number of cases rose to 1.112; up from 902 reported earlier. The largest number of the cases, 484, were in the western region of North Rhine-Westphalia, Germany’s most populous state, boosting anxiety of the economic impact of the spreading epidemic on one of the world’s most trade-dependent economies. Western Europe’s most populous country has the second largest number of registered cases on the continent after Italy. So far, no deaths have been reported, though a transplant patient with a depressed immune system who had contracted coronavirus was in a critical condition. +++ 

+++ FERRARI says its Maranello factory is operating as usual, despite being inside the region of Italy placed under strict quarantine measures to prevent the spread of the corona virus. According to officials, 7.375 people in the country have tested positive for the Covid-19 disease. To try to control the spread, the Italian government has introduced strict measures on the Lombardy region and 14 provinces, impacting around 16 million people. The region includes Ferrari’s Maranello base. In a statement, Ferrari noted the measures allowed for “continued working activity” and said: “Ferrari has activated all of the measures necessary to allow their employees to conduct their working activity in the best possible condition and therefore, at this moment in time, confirms its operational continuity. This continuity is obviously subject to that of our suppliers with whom we are in constant contact. Ferrari remains in ongoing discussions with the authorities and is ready to adapt its security measures with regard to the evolving situation in the knowledge that the safeguard of the health and wellbeing of its employees is of absolute priority”. Ferrari commercial chief Enrico Galliera said that the firm had “taken very necessary actions to take all the protocols and precautions that we are required to, and in fact slightly more, to protect our employees and production”. Galliera said those steps included limited access to the factory, including a suspension of plant tours. He added: “Our supply chain is still in place and we’re carefully monitoring supplies. We don’t see any short-term problems. It helps that we don’t sell based on availability but based on our order book. That helps us to manage future production”. Meanwhile, Ferrari’s Formula 1 team says its plans for this weekend’s Australian Grand Prix in Melbourne are still “going ahead” despite the travel restrictions. It noted that part of its team and equipment were already in Australia for the event and that it was in contact with Italian authorities. It said: “Departures for the remaining members of the team are going ahead as programmed unless we receive communications to the contrary”. +++ 

+++ FIAT CHRYSLER AUTOMOBILES has announced it will transform an idled transmission plant in Indiana into an engine plant. The automaker will invest $400 million to repurpose the transmission plant to build the GMET4 2.0-liter engine. The Global Medium Engine inline 4-cylinder turbo unit is currently offered on the Jeep Wrangler and Cherokee. The investment will help retain 1.000 Indiana jobs and add nearly 200 new jobs to support production, bringing FCA’s total employment in the state to more than 8.300. The facility will become the source of all U.S. production for the 2.0-liter power plant, which is currently built in Termoli, Italy. The Indiana factory, which will be renamed Kokomo Engine Plant, is expected to start production in the second quarter of 2021. “The GMET4 will be a very important engine for us as we look to deliver on the promises we made as part of our 5-year plan in 2018”, said FCA North America chief operating officer Mark Stewart. “While the 2.0-liter is a current engine option on the Jeep Wrangler and Cherokee models, a significant number of new technologies can be applied to this engine, making it relevant for the future. It will play an important role in our plans to offer electric engine options across 30 nameplates that FCA will bring to markets around the world by 2022”, the executive added. FCA has built transmissions in Indiana for more than eight decades. Since record keeping began in 1974, the automaker has made more than 90 million of them. From 2009 to the present day, the company has invested nearly $2 billion in its four area plants to produce 8 and 9 speed automatic transmissions. In total, the group has committed to invest more than $14 billion in its U.S. manufacturing operations, creating nearly 30.000 new jobs since June 2009. +++ 

+++ New-car registrations in FRANCE fell by 2.7 % in February compared to the same month in 2019, with sales of electrified vehicles (conventional and plug-in hybrids, and full-electric vehicles) remaining at a high level under the EU’s new carbon dioxide emissions target of 95 grams per km. There were 167.784 registrations in February on 19 selling days, industry association CCFA said, the same as in 2019. Sales through February were down by 7.8 %, following a 14 % decline in January. Fleet emissions in France ticked up to 102 g/km from 96 g/km in January, however, as that month’s surge of electric and plug-in hybrid models faded somewhat. Hybrid vehicles overall had an 11 % market share; the same as in January. But plug-in hybrids lost market share to 2.3 % in February; down from 2.8 % in January. And sales of full-electric vehicles fell to a 5.6 % market share, compared to 8.2 % in January. Automakers purposely limited registrations of electric and plug-in hybrid vehicles at the end of 2019 to ensure maximum impact on their emissions in 2020. Vehicles with emissions of 49 g/km or under are eligible for EU “supercredits”, counting 2 two sales in 2020. Automakers that miss their targets will have to pay fines of €95 per gram over the limit, per car. The biggest winners among brands with significant volume were PSA’s premium brand DS, with sales surging 113 % after the introduction of the 3 Crossback last spring; BMW, up 37 %; Audi, up 31 %; and Hyundai, up 29 %. Conversely, large drops were recorded by Suzuki, down 37 %; Dacia, down 27 %; Ford, down 26 % and Fiat, down 25 %. Among French automakers, PSA Group sales were steady, with a decline of 0.5 %. The gains by DS offset a 6.2 % decline at Citroen and a 13 % decline for Opel. Peugeot sales increased slightly, by 1.7 %. The Renault Group lost 9.8 %, with the Renault brand down 3.1 % in addition to Dacia’s sharp drop. Asian automakers showed strong growth, with Hyundai Group up 16 % behind strong growth at Hyundai brand and a gain of 5 % at Kia. Toyota Group sales were up 14 %, with Toyota brand up 10 % and Lexus up 90 %, but at low volumes. Nissan sales rose 14 %. The picture was mixed for German automakers. The Volkswagen Group was up 1.4 %, with strong gains at Audi, Seat (up 10 %) and Skoda (up 6.8 %) offsetting a drop of 14 % at VW brand. The BMW Group was up 19 %, with BMW brand sales offsetting an 18 % drop at Mini. Daimler sales fell by 12 %, with Mercedes down 1.6 % and Smart sales falling by 84 % to just 113 units. SUV cars and crossovers made up 39 % of the French market; a gain of 2 percentage points. +++ 

+++ GENERAL MOTORS had announced an assortment of electric vehicles this week including a new Chevrolet Bolt and the range-topping Cadillac Celestiq. However, journalists who attended GM’s EV Day were given a sneak peak at several other upcoming models. While Cadillac confirmed the all-new Lyriq will be unveiled next month, it’s actually a concept which is “about 85 % true to the production vehicle”. As a result, it has some fanciful features which are said to include a 4-seat interior and massive 23-inch wheels. Those items likely be dropped for production, but we wouldn’t be surprised if the 34-inch display makes it as the 2021 Escalade has a 38-inch curved display which is broken up into multiple sections. Regardless, the Lyriq is said to be about the same size as the Tesla Model X. Cadillac is also slated to receive a large electric SUV which is roughly the same size as the Escalade. It will have 3 rows of seats and a digital display that spans the width of the dashboard. Moving on, the Hummer EV will have removable roof panels which can be stored in the frunk. This means the pickup will offer an open air experience similar to the Jeep Gladiator, but it remains unclear if the doors are designed to be removed. More interestingly, the interior will reportedly eschew leather for eco-friendly recyclable materials. The pickup is also slated to feature a large infotainment system, aluminum speaker grilles and accents featuring topographical maps of the Sea of Tranquility. The latter is where Buzz Aldrin and Neil Armstrong landed on the moon. What that has to do with Hummer remains unclear, but it could be a reference to the Lunar Roving Vehicle. Essentially the ultimate off-roader, the lunar rover was an electric vehicle that was developed with the assistance of GM. The crew cab pickup will have a 165 cm bed and will reportedly be joined by an SUV variant. Little is known about the latter, but it’s said to be about 229 mm shorter than the pickup. While GM confirmed plans for electric Buicks, the company didn’t go into specifics. However, those who attended the event were reportedly shown 2 crossovers. The models were “clearly farther from production than other designs”, but they reportedly shared the same wheelbase. That’s a bit perplexing, but it appears they’ll have radically different designs. Details are limited, but both are said to have sleek styling and a stylish front end that will become the “new face” of Buick. On the mainstream side of things, Chevrolet will reportedly launch a full-size electric pickup in 2025. The brand will also offer an electric 5-seat crossover which is said to be roughly the same size as the Blazer. +++ 

+++ In GERMANY , new-car sales fell 11 % to 239.943 in February as private customers stayed away from showrooms. Registrations from private buyers dropped 16 % while sales to business customers were down 7.8 %. Sales at Tesla fell 37 %. The electric-car maker had been gaining volume last year following the launch of the Model 3. Other brands that saw steep drops included Smart, which fell 81 % after the brand became electric-only and dropped its gasoline cars. Also seeing large declines were Honda, down 39 %; Dacia, down 37 %; Opel, down 21 %; Audi, down 20 % and Ford, down 19 %. Germany’s top-selling brand, VW, saw its sales drop by 11 %. Mercedes-Benz registrations fell 3.3 % and BMW sales were down 1.2 %. Among brands which saw big volume rises were Lexus, up 71 %; Volvo, up 25 %; Seat, up 23 % and Porsche, up 19 %. Despite Tesla’s sales dip, sales of electrified cars gathered momentum, boosted by European automakers adding more plug-in hybrid cars to help meet the EU’s CO2 reduction targets. Registrations of full-electric vehicles rose 76 % to 8.154. Sales of hybrid models rose 98 % to 30.000, including a 279 % increase to 8.354 for plug-in models. Sales of gasoline cars fell 22 %, resulting in a 52.1 % market share. Diesel sales dropped 13 % for a 31.6 % share. The 11 % fall in February sales follows a 7 % drop in January. The fall in registrations in the first 2 months follows an end-of-the-year buying frenzy in December when sales rose 20 % as automakers pushed sales of vehicles with higher emissions ahead of the European Union’s January 1st introduction of stricter CO2 limits. Through February, German sales are down 9 % to 486,243. The German market is undergoing an expected correction, the head of the VDIK importers association, Reinhard Zirpel, said in a statement. The VDIK forecasts registrations to fall 7 % this year to 3.35 million. Zirpel forecast that electrified cars will make a breakthrough this year and achieve significant market share. +++ 

+++ HYUNDAI reported its lowest monthly global sales in a decade in February as the corona virus outbreak hurt demand, in what is the first major indicator of damage to the broader auto sector from the epidemic. It turned in a preliminary sales figure of 275.044 vehicles for the month; 13 % below 315,820 vehicles sold a year earlier. Hyundai last reported sales lower than this in February 2010. Hyundai, which with affiliate Kia is the world’s No.5 car maker, is the first major automaker to announce sales for the month. Chinese and U.S. players will turn in their numbers in the coming weeks. The flu-like virus, which originated in China, has killed nearly 3.000 and roiled global financial markets as investors and policymakers brace for a steep knock to world growth. South Korea has the most cases of infections outside the mainland, with the total at 4.212. “Inside South Korea is now more urgent than China”, Korea Investment & Securities analyst Kim Jin-woo wrote in a note. “With sluggish consumption affecting demand on top of it all, means auto sales are certain to be hit in the first quarter, and the impact expected to continue until at least the beginning of the second quarter”. Hyundai was the first major automaker to flag a hit to its manufacturing outside China when it halted production at home, its biggest manufacturing base, in February due to a shortage of parts from China. While the automaker has gradually resumed output, virus-related uncertainties remain. Just last week, a worker at its factory complex in the southeastern South Korean city of Ulsan tested positive for the virus, prompting it to shut a factory. The plant resumed production on Monday, a Hyundai spokesman said. South Korean corona virus cases are concentrated in the fourth-largest city of Daegu and the North Gyeongsang province, home to about 20 % of auto parts suppliers in the country. +++ 

+++ ITALY ’s automotive industry is currently scrambling to maintain operations despite havoc caused by heavy government restrictions on both travel and public activities. The Italian government approved these new restrictions for the Lombardy region, which includes Milan, as well as parts of Veneto, Piedmont and Emilia Romagna. There have been over 6.300 confirmed Coronavirus cases in Italy, and 233 deaths related to the outbreak. Still, executives at Maserati, Ferrari and 3 vehicle parts suppliers currently working in the expanded “orange zone”, told that business will go on today, largely because their companies were given some leeway to operate. The document states that in cases of “proven working needs”, employees are allowed to travel to work, meaning that the restriction should not “lead to the blocking of production activities, work activities, and even less the blocking of transport and movement of goods from and for the perimeter areas”. Maserati said that starting today, only essential staff will go to work at its facilities in the Modena area, while all others will work from home. The Trident brand has roughly 1.350 employees at 3 different locations in the area. As for Ferrari, it will continue operations as long as it keeps getting the necessary components from suppliers. “Ferrari has activated all of the measures necessary to allow their employees to conduct their working activity in the best possible conditions and therefore, at this moment in time, confirms its operational continuity. This continuity is obviously subject to that of our suppliers with whom we are in constant contact”. Aside from the Maserati factory in Modena, all other FCA plants in Italy are currently outside the area affected by these new government restrictions, which will run until April 3rd. +++ 

+++ Sales of new automobiles in JAPAN dropped 10.3 % from a year earlier to 430.185 units in February, down for the fifth straight month. The sluggish sales can be attributed to the new coronavirus originating in China and lingering effects from the October 1st consumption tax rate hike, according to officials of the Japan Automobile Dealers Association and the Japan Light Motor Vehicle and Motorcycle Association. Some dealers saw a decrease in the number of customers as many people refrained from going out amid growing fears over the novel virus. +++ 

+++ In terms of pop culture, the MERCEDES G-Class has got to be one of the most iconic SUVs, usually shown as the go-to car for bad guys, mobsters, or rich, powerful individuals with a lot of money to burn. Okay, so maybe it’s just an image thing, but there’s something definitely imposing about the classic boxy shape, huge wheels, and if you happen to have the AMG version, the burbles and power from a high-displacement turbocharged engine. Get it in matte black and it’s clear why it has such a reputation. But what if you could have the looks and machismo without the guilt of emissions? Would that be something that a bond villain would go for? Probably not, but for those who are looking for a more environmentally version of their favourite bad guy SUV won’t have to wait too long, as Mercedes-Benz has announced that initial sketches and concept work have begun on the EV version of the G-Class. Daimler chairman Ola Källenius recently said: “The G-Wagen transcends all segments and almost the logic of the car industry, it’s like it is its own company you could say”. Yes, the G is going to go electric, we have kicked off the concept work for this, so in a few years you’ll be able to go electric with the G as well”. The news comes only a few months after the Daimler boss announced that an EV G-Class was on the way. 2019 saw an increase of global sales of the G-Class by an impressive 60 % (almost 35.000 units), shattering the 2017 record of almost 22.000. These sales figures go against the notion that there were talks about discontinuing the G-Class, a vehicle that’s been around since 1979. “We have made a very clear decision, as a general mental flicking of the switch, that modern luxury is going to be sustainable”, Källenius said. +++ 

+++ When it comes to sports cars, they have to be light, powerful, and feel fast, either through sound or tight performance. All the parts put into one have to be considered carefully, and shedding unnecessary weight and maximizing potential has always been a priority. In the case of creating sports cars that also happen to be electric, some manufacturers are having a trickier time than others and PORSCHE has been having just that: current batteries for EV’s are just way too heavy to put in their Cayman and Boxster. Porsche’s R&D team admitted this during their virtual press conference for the Geneva Motor Show. Head of their R&D team, Michael Steiner said: “We are running several electrified Boxsters to gain expertise and knowledge to see how an electric car performs as a two-door. But there is no final decision yet”. While heavier Gran Touring cars like the Taycan can deal with the added weight of batteries, Steiner has said that “the additional weight for a sports car, we are not satisfied with today. This is one of the reasons why our next electric car will be a small SUV, not a 2-door sports car”. He’s talking about the new Macan for 2021, which will be offered as a fully electric vehicle in some territories. The project to electrify more focused sports cars is active, but still far off, and with the slow but steady increase in breakthroughs with lithium-ion batteries, Porsche is waiting for bigger leaps in weight loss, such as solid-state batteries. We predict a 2-3 percent improvement year-by-year in lithium-ion battery improvement. “I am still not happy with the weight, though. But that does not mean there won’t be a sports car”. While all eyes are currently on the Taycan, Porsche has already been busy working on EV related tech for its more affordable range of two-seaters, despite not officially been given the green light to do so. So, for now, expect the Cayman and Boxster to keep conventional engines until the next generation. +++ 

+++ In SOUTH KOREA , local automakers’ sales plummeted last month as demand for cars continued to fall amid the coronavirus outbreak. The aggregate sales for Hyundai, Kia, GM Korea, Renault Samsung and SsangYong dropped 11 percent to 505.212 units, from 567.756 units during the same period a year earlier. Sales for Hyundai dropped 13 % on year to 275.044 cars. Sales by its sister company Kia fell 5 % to 187.844 units. GM Korea’s sales shrank 14 % to 28.126 units and SsangYong’s February sales dropped 27.4 %. Renault Samsung saw the largest drop, with sales nose-diving 39.8 % to 7.057 units. All 5 automakers blamed the coronavirus outbreak pulling down demand and prompting setbacks in production for last month. Throughout February, all of the country’s automakers had to suspend operations and temporarily close their assembly plants due to the supply crunch of auto parts from China. Hyundai closed some of its plants from February 5-12, as the extended Lunar New Year holidays from the coronavirus outbreak prompted longer-than-expected closures at Chinese factories. Hyundai and Kia halted all production at their plants in South Korea on February 7 and gradually started resuming operations. GM Korea closed its Bupyeong factory in Incheon for 2 days, while Renault Samsung Motors halted operations for its only plant in Busan for 3 days. SsangYong Motor had a 9 day shutdown at its plant in Pyeongtaek. To overcome sluggish sales, Hyundai and Kia said they are introducing a large-scale promotion to rebound car sales for this month. Hyundai’s promotion for the month of March will consist of discounts of up to 7 % on 4 of its best-selling models: Avante, Sonata, Kona and Santa Fe. Depending on the vehicle purchased, the discounts are the cash equivalents of 1 million to 2.9 million won ($840 to $2,400). Avante buyers will also be offered low-interest monthly installment plans. Kia is introducing discounts of up to 8 % on its new Sorento, while offering discounts of up to 2 million won for the Morning (Picanto), K3, Sportage and Carnival. The promotions follow a recent government decision to lower its special consumption tax on cars from 5 % to 1.5 %. The measure is in effect through June. +++ 

+++ New-car sales in SPAIN declined 6 % to 94.620 in February, hit by falling demand from private customers. Sales to private customers dropped 11 %; the 17th consecutive month of declines with the single exception of September 2019. In January, they fell 14 %. Sales to rental companies were down 1.6 % in February, while registrations by companies (which include self-registrations by automakers and dealers) declined 2 %. Spanish industry association ANFAC now expects the market to decline 4 % this year. 2 months ago, the body forecast sales would match those of 2019. Sales of gasoline-powered cars dropped 13 % in February for a 55.6 % share of the market; down 4.6 % from February 2019. Registrations of diesel-powered vehicles were down 12 % for a 28 % share; 1.9 % lower than February 2019. Despite this, the 28 % share is higher than the 2019 average of 27.9 %, highlighting the possibility that diesel demand might not sink any further. Sales of electrified cars, including full-electric and hybrid models plus vehicles powered by LPG and CNG, rose 56 % to a 16.5 % market share. Hybrid car sales grew 74 % for a 12.9 % market share. The recently launched Kamiq helped Skoda post a 37 % increase. Other brands within the Volkswagen Group also did well. Spanish brand Seat was up 1.7 %, VW gained 2.7 % and Audi 2.4 %. Porsche sales jumped 173 %. Within the PSA Group, Opel registrations dropped 27 %, Peugeot sales declined 9.2 % and Citroen was down 0.2 %. Renault brand sales were down 11%, while sister brand Dacia suffered a 34 % decline. Within Fiat Chrysler Automobiles, Fiat fell 17 %, Jeep registrations were down 34 %, while Alfa Romeo dropped 12 %. Asian brands had mixed results. Kia posted a 24 % increase, helped by the recently launched XCeed and by a 127 % jump in sales of the Stonic. Sister brand Hyundai had flat sales. Toyota’s sales increased 22 %, while both Nissan’s and Mazda’s registrations fell 23 %. Among other brands, BMW posted a 13 % gain while Mercedes-Benz sales suffered a 17 % drop. Ford sales were down 21 %. Through February, Spanish sales fell 6.8 % to 181.063. +++

+++ Automakers across the world face the possibility of extended SUPPLY CHAIN DISRUPTIONS as factories in China stutter back to life after closures due to the coronavirus outbreak. The car industry is especially exposed as Wuhan (the epicenter of the outbreak) is known as one of China’s ‘Detroits’, accounting for nearly 10 % of vehicles made in the country and home to hundreds of parts suppliers. Non-essential factories in Wuhan and other cities in Hubei province remain on lockdown. When they reopen on March 11, or whenever authorities give the go-ahead, it is not clear if companies will have the raw materials or workers to get back to normal operations. Automakers are concerned about their employees’ health and the uneven and unpredictable application of rules in different cities and regions that is making it hard for an industry that is used to uniformity to plan ahead. “In some cities, one worker gets infected, the whole factory where he works needs to be shut down”, said one official at Honda, which has a manufacturing hub and more than 100 suppliers in Wuhan and the surrounding area. “In Wuhan, that has not been clarified”, he said. “You don’t know what’s going to happen to your factory until you report an infection case to authorities. It’s hard to live with that kind of uncertainty when you’re running a massive factory”. Employees reported back to work at Honda’s other Chinese manufacturing hub, in the southern China city of Guangzhou, on February 10 and partial production restarted on February 17. Production there is still running well below capacity due to parts shortages and logistical delays, the company official said. Honda is expecting to reopen its Wuhan hub this week, after the lockdown is lifted or whenever authorities allow it. Together, Honda’s 2 China hubs have the capacity to produce 1.2 million vehicles a year, or more than 20 % of the company’s total global production. Like other manufacturers in Wuhan, automakers and parts suppliers are still dealing with partially blocked roads and health inspections on major transportation arteries, which are creating problems moving around raw materials and finished parts, according to Yohei Shinoda, personnel manager for Kasai Kogyo, a Japanese company with 4 plants in China producing interior door and roof trims for Honda and other automakers. “Even if we wanted to resume production, we can’t access the materials we need due to supply chain disruptions”, said Shinoda, whose firm has plants in Wuhan, Guangzhou, Kaifeng and Dalian. “On top of that, we’re facing staffing shortages at our plants”. A joint venture between U.S. company Cummins and truck maker Dongfeng, which makes diesel engines for big buses and commercial vehicles in the city of Xiangyang in Hubei province, may face problems. “The logistics between cities remains an issue, we expect it will take longer for us to get parts from upstream suppliers and send engines to Dongfeng plants in other cities”, an official of the joint venture told. The corporate damage in Hubei could be significant and long-lasting. A joint survey of 573 Hubei companies (including 12 involved in auto manufacturing) by Wuhan University and the Wuhan Federation of Industry and Commerce late last month showed more than 97 % of them halted or partially halted production due to the coronavirus outbreak. Nearly 60 % said they would be bankrupt in three months or fewer if operations are not restored. The picture in the rest of China is slightly better. More than 90 % of some 300-plus automotive parts suppliers outside Hubei say they have resumed production, with 80 % of workers present, according to the China Association of Automobile Manufacturers. However, the association said production rates were still not high, given the dearth of orders from manufacturers and logistics problems at smaller second- and third-tier suppliers. Chinese automakers and parts producers exported $53 billion worth of automotive components to the United States, Europe, Japan, South Korea and elsewhere last year. If plants do not get back up to speed quickly, vehicle assembly lines across the world are at risk of slowing or shutting down. General Motors chief executive Mary Barra said that the company’s North American car and truck plants have secured components to last “quite far into this month”. Normally, automakers have parts shipments lined up and assured for many months in advance. Companies are doing what they can to get back on track, but there is no guarantee against disruptions. U.S. drivetrain supplier Dana’s global purchasing team scrambled to get more than 200.000 facial masks for its plants in China to keep workers safe on the job. So far, Dana has avoided any significant disruptions, CEO James Kamsickas said. U.S. auto supplier Cooper Standard has 13 factories across China which have resumed production with 65 % of the normal workforce, said Larry Ott, Cooper Standard’s head of global human resources at the company’s headquarters outside Detroit. “That’s basically what we need right now to satisfy the customer demand”, he said. +++ 

+++ Elon Musk’s plan to turn a remote wooded lot in Germany into the home of a state-of-the-art car factory in less than 2 years sent an unequivocal message to local authorities: make it happen or lose it. Eager to host TESLA ‘s first European plant near Berlin (a potential €4 billion development) German officials assured the company’s CEO fast-track navigation through the country’s notorious bureaucracy. In recent years, onerous regulations have held up projects from a large train station in Stuttgart to Berlin’s first new airport since the end of the Cold War. Administrative red tape can cause the process of sorting out building permission to take as long as four years. Even something as simple as a mobile-phone mast can drag out for 2 years. That makes Tesla’s ambitious deadline a critical test case of Germany’s ability to adapt just as the powerhouse economy sputters. And even the U.S. automaker’s German rivals are cheering it on. “Bureaucratic hurdles shouldn’t decide the race between Tesla and Volkswagen, but the question who builds better cars”, Herbert Diess, CEO of the German automaker, said. “That kind of healthy competition makes Germany better and more innovative”. When complete, the Tesla factory will employ up to 12.000 people and churn out as many as 500.000 vehicles annually. Tesla is moving into Germany’s heartland to vie with Volkswagen, BMW and Mercedes-Benz as the country targets a massive increase in electric-car sales. Tesla was reminded of the risks when a court last month stopped work to clear the site in Grünheide, a rural community east of Berlin. The problem, though short-lived, sent shock waves through the capital, where Tesla’s factory has boosted confidence in Germany’s ability to attract international investment. The near miss, which could have delayed the factory by months, prompted Economy minister Peter Altmaier to pledge legislation to reduce red tape and he proposed setting up mobile planning task forces to expedite key projects. Important investments such as Tesla’s “only have a chance if we make decisions on time”, Altmaier said. German business is watching Tesla’s project closely, hoping the high profile of the investment will help remove hurdles holding up hundreds of projects up and down the country, from 5G wireless equipment to rail tracks and upgrades to the aging power grid. “Germany just can’t and won’t let this project snag on bureaucracy and litigation”, said Hubertus Bardt, managing director of the IW Cologne economic institute. “Too much investment reputation is staked on it”. Work resumed in late February on clearing pine trees on the 740-acre plot in the state of Brandenburg. Tesla is under pressure to finish the process before birds start nesting later this month. Missing the deadline could delay construction until the fall. The company wants the plant to be ready by mid-2021, when electric-car demand is likely to be bolstered by tighter emissions regulations taking full effect. Meeting the deadline requires quick approval for a highway connection and power-grid access. In a sign of how Tesla’s project is spurring change, Brandenburg is leaning on the investment to push the federal government to change energy regulations, according to the state’s Ministry of Economy, Work and Energy. The former communist state, desperate to secure attractive jobs, wants to help local businesses access Brandenburg’s affordable wind and solar power, which currently feeds the national grid. “Tesla should be able to use local green power”, the ministry said. To ease local concerns about the environment, the automaker set aside a number of trees on the plot that house bats’ winter quarters. The company has also volunteered to plant more trees than get cut down. If the next steps get cleared, including a public hearing on March 18, Tesla would be on track to officially break ground this month, a ceremony that Musk has said he’ll attend. For Germany, the project could unlock a path for other stalled developments, with project planners bogged down by hundreds of lawsuits, often tied to Germany’s wildlife and environmental protection regulations. Onshore wind park construction has ground to a halt, citizen groups in Bavaria are thwarting rail links with Austria and locals are blocking construction of about 1.000 mobile-phone masts. “If Tesla and government agencies get the project done on time, companies and infrastructure planners everywhere can take this as proof that projects can be implemented”, said IW Cologne’s Bardt. +++ 

+++ TVR has submitted a planning application detailing the refurbishment of a factory in Ebbw Vale, Wales that will handle production of the Griffith. This marks an important step in bringing the sports car, crippled by delays in recent years, to the production line. West Wales based Jones Brothers will carry out the refurbishment of the derelict factory and while no schedule has been publicized, work is unlikely to be completed by the end of the year. The site will initially employ approximately 80 people before the workforce swells to 200 as production of the Griffith is ramped up. In a newsletter sent to prospective owners last month, TVR chairman Les Edgar confirmed that work at the Ebbw Vale site has been slow. He also revealed that the original Griffith show car from 2017 has been road-registered in the UK and will be used for testing purposes and event participation. Of more importance is the fact that TVR is engaging in negotiations to use Ford’s latest 5.0-liter Coyote V8 engine that’s been updated to comply with current EU emissions standards. The engine used by the 2017 show car was fettled by Cosworth and delivered no less than 500 hp. Mated to this engine is a Tremec Magnum XL 6-speed manual transmission driving the rear wheels. TVR quotes a 0-100 km/h time of less than four seconds and a top speed exceeding 321 km/h. +++ 

+++ In the UNITED KINGDOM , new-car registrations fell 2.9 % in February to 79.594 as low consumer confidence continued to hit demand. Sales to private customers fell 7.4 % for a 42.8 % market share, while fleet registrations were flat, gaining just 0.1 %, to give them a 55.4 % market share, the SMMT industry association said. Sale of full-electric cars increased by 243 %, while registrations of full-hybrids rose 72 % and plug-in hybrids were up 50 %. Sales of diesel vehicles fell 27 % to give the fuel type a 21.9 % market share, while sales of gasoline cars fell 7.3 % for a 60.6 % share. The Volkswagen brand, the new UK market leader, saw its registrations rise 12 %, while former No. 1 Ford was pushed into second place as sales fell 19 %. Third-placed BMW’s volume declined by 3 % ahead of rival Mercedes-Benz, whose sales dropped 5.6 %. At fifth place, Audi fell 12 %. Brands that saw gains included Toyota, up 48 %; Land Rover, up 33 %; Fiat, up 15 % and Vauxhall, up 4.6 %. Brands with big drops included Renault, down 32 %; Jaguar, down 24 %; Dacia down 18 % and Jeep, also down 18 %. In February, the Volkswagen Golf took top spot with 3.457 registrations, ahead of the Ford Fiesta (3.123) and the Ford Focus (2.764). +++ 

+++ In the UNITED STATES , customers streamed into auto showrooms from California to Florida over the weekend, car dealers across the country said, shrugging off concerns that coronavirus worries might dampen sales. Industry analysts cautioned that a growing number of virus infections could deter Americans in March, and automakers face difficult calls on pricing and production. But dealers and analysts said there was no discernable impact on February car sales, a strong month for dealerships. Car makers are expected to give dealerships details of their consumer discount offers in the coming days. Changes to pricing offers could reflect a drop in supply of some Asian vehicles hit by supply shortages. Automakers could also cut prices to lure worried U.S. shoppers. Since the virus originated in China 9 weeks ago, demand for cars has plunged in Asian countries as dealerships were closed and consumers stayed home. To date, 10 U.S. states, including California, have confirmed presumed infections. California is the country’s biggest car market, accounting for more than 10 % of all U.S. sales. Larry Laskowski, executive director at the Independent Automobile Dealers Association of California, which represents the state’s roughly 6.000 used car dealers, said the coronavirus has not been an issue for members. In San Ramon, a city 35 miles east of San Francisco surrounded by counties that have reported coronavirus cases, dealership owner Greg Meier said his business was better than expected this weekend. “Some people were joking about the virus when they came in this weekend, but no one was panicked or scared”, Meier said. His remarks were echoed by dealership groups in Texas, Florida and New York. A spokeswoman for the National Car Dealers Association said the group reached out to dealers in various regions over the weekend and received no reports of a fall-off in foot traffic or a drop in sales. Total U.S. auto sales in February are projected to reach more than 1.3 million vehicles, according to JD Power; up 1.8% from last year. Tyson Jominy, the research firm’s vice president of automotive data & analytics consulting, said there was no reason to back away from that projection due to the virus. But he said analysts were closely watching changes to car makers’ incentives packages as an indicator of sales. Of particular interest are popular Asian models, such as Hyundai’s Palisade and Subaru ‘s Forester. Moves to increase finance interest rates or upfront down payments could point to tight supply. +++ 

+++ VOLVO has taken another big step on its journey toward having full-electric cars make up half of its global sales by 2025 with its first battery assembly line here. Ghent plant boss Stefan Fesser promised a “flawless launch” of battery system production at a new 5.000 square-meter facility, which is on the same campus as Volvo’s vehicle assembly plant. His promise comes despite recent reports that Volvo’s cell supplier, LG Chem, has had trouble meeting demand from other automakers, resulting in production stoppages at 2 rivals. Last month, Audi had to stop making the e-Tron at its factory in Brussels. Media reports blamed the problem on a shortage of cells supplied from LG Chem’s factory in Wroclaw, Poland. Jaguar Land Rover was also forced to reduce production of the I-Pace, which is made in Graz, Austria, due to battery supply issues from LG Chem’s Poland plant. Multiple Volvo executives at the battery line’s inauguration expressed confidence in the Korean supplier’s ability to provide it with enough cells to keep up with demand for the automaker first full-electric car, the XC40 Recharge P8, which goes into production in late September. “We don’t have any issues”, Volvo’s Jonas Engstrom told. “Everything is running according to plan”. Volvo’s new model launch manager, Peter Durie, also said that there has been no indication that LG Chem would have any issues supplying the factory, which starts test production this week. The aim is to have the line ready for serial output in time for the XC40 Recharge’s start of production. Volvo anticipates it will need a steady supply of cells because of strong demand for its first EV. “This car has exceeded all of our expectations when it comes to initial hand-raisers and orders”, said Engstrom, who is business owner for Volvo’s 40- and 60-series cars. When asked how many orders he said, “We have thousands”. He declined not to be more specific or share the battery line’s initial capacity. He did, however, say, “I would not be surprised if we, sometime in the future, revised capacity”. Durie said that the battery line would operate the same number of shifts as Ghent plant, which is three, or 24-hours a day. He declined to say how long Volvo believes it will take to complete a battery at its new facility. Volvo builds 1.000 vehicles a day in Ghent, where the XC40 is produced on the same line as the V60. Last year’s output was 225.000 vehicles, of which the XC40 accounted for 185.000 units. The assembly plant already has plenty of experience with electrified powertrains because one out of every nine vehicles off the Ghent line is a plug-in hybrid, said Geert Willems, who is head of final assembly. The Ghent plant will begin making mild hybrid versions of the XC40 and V60 in May but the big change comes this autumn with the move to producing full-electric models. To make that happen Volvo spent the last 2 years and millions of euros converting a former employee parking lot into a home for its 95-meter long, 9-station battery production line for the 78 kWh battery that will help provide the XC40 Recharge with more than 400 hp and 660 Nm. Volvo estimates the XC40 Recharge will have a range of 400 km and that the SUV’s battery can be replenished to 80 % of capacity in 40 minutes using a fast charger. Volvo invited the media and local politicians to Ghent for a final look inside the facility before restricting access to just 450 highly trained operators. They will work in a dust-free, high-voltage environment. Altogether, Volvo has invested €150 million into Ghent to add the battery line and equip the factory to make mild and plug-in hybrids, which Volvo says will account for the other half of its global sales by 2025. The investment also includes €24 million to provide training to the operators. Construction on a second battery line is scheduled to start at Volvo’s U.S. plant this autumn. That line will produce battery systems for the full-electric version of Volvo’s third-generation XC90. +++

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