Newsflash: Fiat 500 en Panda verkrijgbaar met D-Fence antivirus pakket

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+++ BMW ‘s M division has been on a roll as of late, and despite the coronavirus pandemic slowing things down considerably all over the world, there’s no denying that the performance-oriented line of the German manufacturer has seen a huge growth in just 5 years. Markus Flasch, CEO of BMW M, spoke about his plans for the future and the challenges that his brand faces. With almost half of all BMWs sold wearing an M badge (M trim and actual M cars included), there’s been some talk that the identity of the ‘M’ was starting to lose some credibility, in which he says that “M has never been a competing brand to BMW. M is the exaggeration of what BMW stands for in terms of driving pleasure. M supplements BMW, and it’s going to remain this way”. Much of this recent success has been attributed to its relatively modest M2, Flasch saying that the M2 is “the smaller, crisper, and rougher package” when compared to the M3 and M4. “These cars don’t compete with each other. I’m very happy with the set-up that we have and we’ll keep it this way”. In 5 years, the M brand has grown over 200 % and while sales are better than ever. There is still the question of whether or not driving customers towards aspirational and faster cars might be undermining BMW’s efforts in electric mobility. Flasch says that it’s all about balancing the portfolio and that M cars are as efficient as possible, stating that they aren’t at odds. And what about a hybrid or electrified M car?  “We won’t mess around or compromise the distinct character that our M cars have today”. he says. “An electrified car, whether it’s plug in the wall, battery-electric, has to take it up with the predecessor and I know that there are physical limits, but within physical limits of working dimensions, we are going to make it happen”. When asked about why power numbers seem to taper off in more recent M car generation gaps, he says he doesn’t recognise any gentleman’s agreement or limit, and that it’s all about offering a package that’s accessible for everyone. “Power is nothing without control, right? And if there isn’t something with too much power it’s just a question of how you tune in and hone into a car, and how you make it accessible”, he explains. “You look 10, 15 years back and if you imagined 625 hp in a saloon car, you’d probably be scared. Now, I can give an M5 this 625 hp and only drive to my mom, in winter, and she’d still be okay. It’s all just a question of how you incorporate it into a package that makes it accessible for everyone, and this is what M has always been brilliant in. Don’t expect a power limit”. +++

+++ Almost half of Brits are planning spending sprees once the CORONA VIRUS lockdown is lifted, according to new research. The study found new cars and holidays were among the items consumers were most likely to be holding out for. The survey of more than 2.000 people found 47 % of respondents had been spending more time browsing the virtual shelves for future purchases. Of these people, 22 % said they were looking for clothes, while 14 % said DIY products were top of their lists. However, a sizeable number said they were looking at bigger-ticket items to purchase once the lockdown is lifted. 6 % said they were looking at a new car, while almost 9 % said a holiday was in their sights. Of those looking to buy a new car, there was a clear preference for premium brands, with BMW and Audi models topping consumer wish lists. Almost 30 % of those seeking a new car were considering a BMW, while 27 % were looking at Audis. Ford was a distant third, with a 16 % share of the spoils. Analyst Vix Leyton said the data showed consumers were planning their post-lockdown futures. “With so much extra time on our hands, it’s no wonder we’re turning to browsing, in the absence of other distractions”, he said. “But alongside the small treats we remind ourselves we deserve because we’re not spending money out and about, it’s interesting to see people planning their post-lockdown future. Having a fixed end goal or purchase in mind is clearly helping people to cope with life in lockdown as we approach May and the third month indoors, while we all know this time is absolutely essential, we can still daydream about an escape to the sun or the freedom of a brand new car”. The news comes as the UK enters its 7th week of lockdown; a measure implemented by prime minister Boris Johnson back on March 23. Since then, Brits have been limited to leaving the house only for exercise or to buy essentials, although those who cannot work from home have still been allowed to commute. +++

+++ The union that represents U.S. hourly workers at DETROIT AUTOMAKERS gave its tacit approval for the companies to restart production amid the coronavirus pandemic, after Fiat Chrysler said it expected to reopen its North American plants on May 18. The United Auto Workers union has been negotiating with Fiat Chrysler Automobiles (FCA), General Motors (GM) and Ford over how and when to safely restart U.S. production after widespread lockdowns aimed at curbing the spread of the novel coronavirus. “We continue to advocate for as much testing for the disease as possible at the current time and eventually full-testing when available”, UAW president Rory Gamble said. “As for the start date, the companies contractually make that decision and we all knew this day would come”. FCA said as it reported its first-quarter results that it expected to restart its North American operations on May 18. GM and Ford have not announced restart dates, but the Detroit companies want to resume production so they can start bringing in much-needed cash. U.S. auto production ground to a halt in March as the number of cases of the novel coronavirus jumped. But with president Donald Trump pushing for Americans to get back to work and several U.S. states reopening their economies, the focus in the auto sector has shifted to when production can safely restart. Michigan governor Gretchen Whitmer previously extended the state’s stay-at-home order through May 15, but lifted restrictions for some businesses other than manufacturing. Neighboring Ohio allowed manufacturing to resume and Whitmer is facing increasing calls to follow suit. Tesla chief executive Elon Musk was highly critical last week of the various states’ stay-at-home orders, which have idled the electric carmaker’s California plant. He called the policies “fascist”. Ford said it had not determined when to restart North American production. “We are continuing to assess public health conditions, government guidelines and supplier readiness to determine when the time is right to resume production”, spokeswoman Kelli Felker said. Last week, Ford outlined the safety measures it will institute to restart its U.S. plants and said getting clearance from Michigan would be the last step. GM and FCA have instituted similar measures at their plants. Gamble, who had previously said early May was “too soon and too risky” to resume production, said his own family would be among those reporting to plants. His previous rule for automakers was asking whether they felt it was safe enough to send their own family members into plants. Ford chief operating officer Jim Farley said last week he would “absolutely” be comfortable having his family working at a Ford plant, given the steps taken to ensure employee safety. “We must implement and follow these guidelines and self-reporting procedures we have worked out”, Gamble said, referring to guidelines on worker health and safety. “And the UAW will fulfill its role to continue to actively monitor and aggressively respond regarding all issues impacting the health and safety of UAW members in whatever manner may be necessary as we return to the worksite”. +++

+++ When General Motors launched the EV1 over 2 decades ago, consumers cited 3 major problems with ELECTRIC VEHICLES : charging station availability, driving range and purchase price. Fast forward to today and guess what consumers say is the biggest problem with electric vehicles? Charging station availability, driving range and purchase price. While a lot has changed since the introduction of the EV1, consumers are still skeptical about electric vehicles according to a J.D. Power study. Even people who have owned electric vehicles cited charging station availability, driving range and purchase price as the 3 biggest barriers hindering adoption. To make matters worse, the company’s Mobility Confidence Index for electric vehicles remained at 55 out of 100 for the 4th consecutive quarter. In Canada, the number actually dropped from 59 to 57. While the study included owners of electric vehicles, it found that most people have little experience or knowledge about them. 70 % of American and 67 % of Canadian respondents have never been in an electric vehicle and 30 % of Americans said they know nothing about them. Despite the knowledge and experience gap, approximately 30 % of respondents said they might purchase an electric vehicle in the next 4 years. On the flip side, approximately the same percentage said they have no intention of buying one. More interestingly, some previous EV owners said they wouldn’t buy one again due to costs, limited range and performance in extreme weather (particularly cold). Consumers aren’t just wary about EVs as they’re even more skeptical about autonomous vehicles. The Mobility Confidence Index for self-driving vehicles fell from 36 to 35 for Americans and 39 to 36 for Canadians. There’s no word on what caused the drop, but declines in support are typically tied to high profile events such as accidents. Given the lackluster support, J.D. Power’s executive director of driver interaction and human machine interface research, Kristin Kolodge, said “We’re concerned for automakers” as “they’re pushing forward with technology that consumers seem to have little interest in”. Kolodge also said companies are “investing billions in these technologies but they need to also invest in educating consumers” as “lack of knowledge is a huge roadblock for future adoption”. +++

+++ FERRARI still expects to make more than $1 billion in core profit this year, providing a relative beacon of stability in an auto industry ravaged by the coronavirus crisis. The company cut its 2020 core earnings forecast, blaming a hit to motorsport revenues among other pressures, and warning of an extremely tough second quarter. But the Italian firm said it still expected to generate free cash flow this year, and its guidance contrasted with others in the industry (including Tesla, Daimler and Volkswagen) which have all suspended forecasting. “This extraordinary level of stability in an economic crisis takes top place at the podium”, Morgan Stanley analysts said. Ferrari, which on Monday restarted operations at its plants in Maranello and Modena, predicted a “harsh” reduction of revenues linked to Formula One, where races have been suspended, as well as reduced turnover from brand projects and lower engine shipments to Maserati. “Second quarter will be very weak”, Chief executive Louis Camilleri told analysts, as the company said it now expected adjusted earnings before interest, tax, depreciation and amortisation this year to edge down from 2019 levels to €1.05-€1.20 billion. In February, Ferrari had projected an increase in profit to €1.38-€1.43 billion. “While the Formula One hit to revenues and earnings is not an easy matter to digest, the good news is that the significant losses incurred should be short-lived and contained to 2020”, Camilleri said. The CEO said projections relied on Ferrari’s ability to retain a “very strong” order book, adding that as of now it had not received any “abnormal or untoward” cancellations. Ferrari, whose origins date back to 1929, said it now expected industrial free cash flow of €100-€200 million this year, compared with €400 million or more previously. The company, which like its former parent Fiat Chrysler Automobiles is controlled by the Exor holding company of the Agnelli family, cautioned its new guidance did not include a potential second wave of Covid-19 infections. In the first quarter of this year, adjusted profit rose 1.9 % to €317 million; broadly in line with a €322 million forecast in an analyst poll. Ferrari’s 2 plants, both located in Italy’s northern Emilia Romagna region, had been closed since mid March. Volumes rose despite delivery suspensions due to the virus outbreak, driven by 488 Pista and 488 Pista Spider models, along with the ramp up of the F8 Tributo, the company said. The margin on adjusted profit came in at 34 % in the first quarter; up from 33.1 % a year earlier. Ferrari said its total available liquidity at the end of March was €1.23 billion. Last month, it secured additional committed credit lines worth €350 million, with maturities up to 24 months, taking total committed, available and undrawn credit lines to €700 million, it said. +++

+++ FIAT CHRYSLER AUTOMOBILES (FCA) plunged to a first-quarter loss of $1.8 billion and warned of a “significant” loss this quarter, even as it prepares to reopen its most profitable North American truck plants on May 18 as coronavirus lockdowns ease. The Italian-American company, which has struck a binding merger deal with PSA to create the world’s fourth largest carmaker, said that work on the tie-up was “progressing incredibly well”. Chief executive Michael Manley said “the terms of the deal have not changed” and FCA remained “committed to completing the transaction by the end of this year or early 2021”. Car sales across the world have slumped as measures to contain the coronavirus pandemic forced production lines to shut and showrooms to close, leaving manufacturers scrambling to try to conserve cash. Manley said a planned €1.1 billion dividend was under review as part of FCA’s efforts. The company also scrapped its full-year earnings forecast. FCA has begun reopening plants in China and Europe, and said most of its North American ones were expected to reopen on May 18. Much of FCA’s revenue and profit comes from North America, where quarterly sales of its Ram truck brand were up 7 % from the previous year and its share of the full-size pickup market rose to 24 %. Capital expenditure was up in the quarter, driven by spending on the new Jeep Wagoneer and Grand Wagoneer, and redesigned Grand Cherokee models. But executives said full-year expenditure would be trimmed by €1 billion as key programme launches had been delayed by an average 3 months. FCA said it made a net loss from continuing operations of €1.69 billion in the quarter. That compared with a €508 million net profit a year earlier. “The pandemic has had, and continues to have, a significant impact on our operations”, the company said in a statement. However, FCA still made an operating profit, albeit 95 % lower than a year earlier. Adjusted earnings before interest and tax amounted to €52 million. The automaker said that due to the continued uncertainty related to the pandemic, it had withdrawn its full-year guidance and would update it when it had better visibility of the overall impact of the crisis. In February, the group guided for an increase in adjusted profit to more than €7 billion this year and industrial free cash flow of over €2 billion. In the first quarter, industrial free cash flow was around minus €5 billion. But FCA said it had available liquidity of €18.6 billion as of March 31, including a €6.25 billion revolving credit facility which was fully drawn down in April. Liquidity was further strengthened last month with a new €3.5 billion incremental bridge credit facility which remains fully undrawn. “We continue to assess all funding options”, FCA said. +++

+++ HYUNDAI has been making quite the buzz lately with its upcoming pickup: the Santa Cruz. The unibody pickup targeting the American market debuted its production form, albeit completely wrapped in camo, in a set of spy shots back in February. Thanks to a recently leaked image that shows the truck’s full-body, we have a lot less to wonder about. This leaked photo of the Santa Cruz gives us a clearer picture of what the Hyundai pickup will look like; at least from the side profile. The photo confirms the short bed, and the sloping C-pillar that we first saw on the concept photos. Look closely at the image and you also see a crease in the passenger door similar to that of the new Elantra. Otherwise, we’re left wondering how the rest of the puzzle pieces will fall into place. While the concept images provided a great first look at the Santa Cruz, I’m excited to see the production truck shape maintain the same basic recipe, with some design cues found in the rest of the Hyundai lineup. Hyundai will produce the Santa Cruz at its Alabama plant alongside the Santa Fe, Sonata and Elantra. There are no concrete details of late, but I do know that the unibody pickup will be exclusively sold to the American market, with an expected launch in 2021. +++

+++ The coronavirus pandemic has absolutely decimated the new car market and its impact has been felt around the world, perhaps nowhere more than in INDIA : no new cars were sold in the nation of 1.35 billion people in April. Strict lockdown measures in India have forced all car factories and dealerships to close their doors, meaning a grand total of zero new cars were sold last month. The only road-going vehicles being sold by automakers are being exported, and they are few and far between. Maruti Suzuki exported 632 of its vehicles in April, while Mahindra exported 733 units throughout the month. Among the only vehicles still being sold in India are the likes of tractors and other machinery required for the agricultural industry, which is plowing on (pun intended) as one of India’s essential sectors. Mahindra sold 4.716 tractors in April. “At Mahindra, we are working hand in hand with all stakeholders, especially our dealer and supplier partners, to get our ecosystem started, once the lockdown is lifted. The safety of all our employees will be of paramount importance to us while resuming our operations”, chief executive Veejay Nakra said. “We are hopeful that our dealerships will open soon and have stocks to cover the first few weeks of sale. In the export market we have sold 733 vehicles during April”. While lockdown measures will eventually be eased in India, that doesn’t mean car production can quickly re-commence. Some automotive hubs in the country, such as the Pune-Pimpri-Chinchwad belt, have been hit particularly hard by the coronavirus and that a lack of parts at factories located elsewhere in the country will have broad impacts. “It is going to be tough. Assembling a car is a very complex process and involves thousands of parts. If even one part is not available then the car cannot be made”, senior vice president and director of marketing and sales at Honda Cars India, Rajesh Goel said. “We are waiting for government directions and have started preparing ourselves internally. All I can say for now is it will be a lengthy and slow process. Nobody can say when the industry will reach the situation of business as usual”. Meanwhile, certain brands are already getting back to work. MG Motor began operations and manufacturing on a small scale at its facility in Halol in the last week of April, despite already having a backlog of 15.000 cars waiting to be delivered to customers. +++

+++ It’s no secret that JAGUAR is working on the next-generation XJ. It turns out the designers of the British company want to go big with the new luxury saloon. In an interview, chief designer Julian Thomson, who replaced Ian Callum in July last year, disclosed that the new XJ will be something special. Interestingly, both the former and current lead designers in Jaguar put their hands on the new flagship saloon from Coventry. “It’s a stunning car, it really is, and we’re all very, very pleased with it”, Thomson told. “It’s a very significant product. XJ was really, really significant when it was launched in 1968 and that car really rewrote the book on luxury executive cars, as they were then, and I think this one really does question the values of what F-segment luxury saloons are about. It’s a very different product, but a very refreshing product, in that way. It’s not a traditional business saloon”. Indeed: the new XJ will have a liftback form, rather than a conventional sedan shape. This, combined with design cues that will influence future Jaguar models, should create a modern and sleek saloon. At first, the British company will introduce the model with an all-electric powertrain and it is believed the big cat will feature as many as 4 electric motors and a range of 470 km between 2 charges. Riding on the Jag’s Modular Longitudinal Architecture platform, the XJ will eventually get electrified 3.0-litre engines, too. +++

+++ MOPAR is probably best known for high-performance special editions and rugged accessories for the Jeep Wrangler, but their latest package is a sign of the times. Introduced in Italy earlier today, the D-Fence package is a germaphobes’ dream as it promises to eliminate up to 99 % of the bacteria in the 500 and Panda Hybrids. In order to do this, the package includes a high-performance cabin air filter which forms a “border” between the inside and outside of the vehicle. Mopar says the filter stops allergens and particulate matter from entering the cabin. To clean the air that’s already inside the vehicle, the package includes an air purifier with a Hepa filter. This enables to it trap “micro-particles” such as pollen and bacteria. As an added bonus, the air purifier can apparently be removed and brought inside to clean your home’s air when you’re not driving. Last but not least, the package includes a UV light which promises to eliminate up to 99 % of the bacteria on surfaces. Mopar suggests people use the ultraviolet light to sanitize commonly touched surfaces such as the steering wheel, seats and gear selector. While the package probably won’t protect you from the coronavirus, Fiat president Olivier François said “The car will now, even more than before, be attentive to the well-being of those who use it”. He went on to describe vehicles as “even more protagonist” in the future of urban mobility. As we have previously reported, a number of automakers are exploring making ‘healthier’ cars in response to the coronavirus. A lot of that focus has been on air filtration, but security is also expected to be beefed up. Research has shown shoppers are putting a greater emphasis on healthy features. Back in a March, a survey revealed customers were far more interested in things such as antibacterial materials and germ filters than more high-tech features such as autonomous parking and autonomous summon functions. +++

+++ Tesla chief executive Elon MUSK appeared to qualify for a $700 million payday, just 3 days after he said the electric car company’s stock price was too high. Shares of Tesla jumped more than 8 % on Monday, putting Tesla’s market capitalization at $141.1 billion at the close. More importantly for Musk, Tesla’s stock market value reached a 6-month average of $100.2 billion. Hitting a 6-month average of $100 billion triggers the vesting of the first of 12 tranches of options granted to the billionaire to buy Tesla stock as part of a pay package agreed in 2018. Musk has already met two other requirements by hitting a growth target and far exceeding a one-month average $100 billion market cap. Each tranche gives Musk the option to buy 1.69 million Tesla shares at $350.02 each. At Tesla’s closing stock price of $761.19, Musk would theoretically be able to sell the shares for a profit of $694 million. Musk said on Twitter, “Tesla stock price is too high imo”, using an abbreviation for “in my opinion”. That tweet sent Tesla’s stock tumbling 10 %, shocking shareholders. Tesla, whose California factory is closed as part of the state’s coronavirus-related lockdowns, posted its third quarterly profit in a row last week. Musk, who is also the majority owner and CEO of the SpaceX rocket maker, receives no salary or cash bonus, only options that vest based on Tesla’s market cap and milestones for revenue and profit growth. A full payoff of all tranches would surpass anything previously granted to U.S. executives. When Tesla unveiled Musk’s package in 2018, it said he could theoretically reap as much as $55.8 billion if no new shares were issued. However, Tesla has since issued shares to compensate employees, and last year it sold $2.7 billion in shares and convertible bonds. Musk’s subsequent options tranches would vest at $50 billion increments of Tesla market capitalization over the agreement’s 10-year period, with the billionaire earning the full package if Tesla’s market capitalization reaches $650 billion and the high tech vehicle maker achieves several revenue and profit targets. +++

+++ Vehicle sales by NISSAN in China this month had almost recovered to the prior year’s level, after logging a coronavirus-related 44.9 % plunge in March, 2 sources with knowledge of the automaker’s preliminary data have said. The data reinforces growing optimism that the world’s biggest car market is stabilizing fast as businesses return to normal in China, making it a rare bright spot as most dealerships in Europe and the United States remain shut. Nissan’s vehicle sales in China, which include Nissan, Infiniti and China-only brands, as well as light commercial vehicles, contracted just “a few percent” in April from a year earlier when it sold roughly 121.000 vehicles, said the people who had seen the data. Sales of the Nissan brand alone showed a “small growth”, one of the people said. Nissan declined to comment on the April sales numbers but said the data would be made public on May 11. The people declined to be named as the data was preliminary and not yet public. The estimated results mark a sharp improvement from the 44.9 % drop in March and 80.3 % fall in February previously reported by Japan second biggest automaker. “We’re putting all efforts on China and the U.S. market to regain momentum”, said the other source, adding that Nissan was ramping up marketing and offering incentives to dealers. He also pointed to what he described as nascent signs of “changing views” on public transit and ride-hailing services resulting from the coronavirus outbreak, which might have encouraged some consumers to shun such services and opt to buy cars instead. In China, Nissan makes cars with state-owned Dongfeng Motor Group. The Japanese automaker said in January it aimed to sell 1.6 million vehicles in China this year. Nissan’s improving sales also follow upbeat data released by an auto industry group in China, cementing optimism that momentum building since the start of this month has gained a solid foothold. The China Passenger Car Association said this week that sales of passenger cars jumped 12.3 % between April 20 and April 25, helping to limit the drop in sales in the first 25 days of the month to 1.6 % compared to the same period a year earlier. China’s auto sales tumbled 43.3 % in March in their 21st consecutive month of decline, but improved from a 79 % plunge in February. A solid business recovery in China would offer much needed relief for Nissan, which had been reeling from falling global sales even before the pandemic due to an aggressive expansion plan pursued by ousted leader Carlos Ghosn. A third company insider said market share was a more critical focus for Nissan than volume as it deals with the effects from the Covid-19 pandemic. He said Nissan’s chief operating officer, Ashwani Gupta, who chairs the company’s internal China management committee, had already shifted Nissan’s strategy. “He wants Nissan’s China team to focus on market share without jeopardizing profitability, so when the market starts growing again, you get the volume, too”, the source said. The source added that such a strategy was critical as Nissan waited for new and redesigned products for the China market. The pandemic has piled on pressure to renew downsizing efforts and Nissan’s management has become convinced that the company needs to be much smaller, arguing for a recovery plan that will likely cut 1 million cars from its annual sales target. Nissan expected an annual operating loss of as much as ¥45 billion ($420 million) for the year ended March 31, which would be its first such loss since the 2008 global financial crisis. Nissan will restart phased production in early June at its northern English Sunderland factory, Britain’s biggest car plant, as the sector tries to resume operations amid the coronavirus outbreak. Output at the site, which made just under 350.000 vehicles last year and builds the Qashqai, Juke and Leaf models, has been suspended since March 17. “During this period the majority of plant employees will remain furloughed, and we are grateful for the government support that has enabled us to take this action”, the company said in a statement. Last week it began piloting safety measures involving around 50 staff at the location. +++

+++ Early versions of TESLA ’s new Model Y electric crossover are out, and like the Model 3 and other Tesla models before it, some customers are reporting problems with the factory paint job. The latest comes from Ryan Shaw, who says he discovered “very obvious paint issues” when he took delivery of his new Model Y, and especially after he took it to a Tesla Service Center, where it underwent more buffing and other supposed corrective work. So he takes his new red Tesla to Detail Union, a car detailing shop near Los Angeles that specializes in Teslas and other high-end vehicles, for a full detail, paint fixes and protective ceramic coating. What’s interesting are the measurements the detailer takes that found wider-than-normal variations in paint thicknesses on various parts of the vehicle, including places where there was no paint. Shaw said the detailers told him that Tesla uses good-quality paint, but suffers from quality control, which is a complaint we’ve heard before about Tesla. “You can clearly see a lot of adulterating, as the detail shop put it, as well as just swirl marks and all sorts of stuff that is basically Tesla trying to fix bad paint jobs”, he says. “And there’s a lot of evidence of it all around the car”. It’s similar to other accounts I’ve seen. Shaw says he recommends that everyone give their new vehicle the same washing, detailing and paint fixing procedures, since every new car will likely have some degree of paint flaws and needs help to keep looking new. But at this stage, available Long Range versions of the Model Y are selling for $52,990 and up. Shaw said he paid $990 for the ceramic coating and everything else, while another commenter claims to have paid $1,500 for the same process. Granted, we’re already talking about a level of consumer that isn’t exactly short on dough. But shouldn’t these problems be prevented in the first place? +++

+++ In the UNITED KINGDOM , new car sales slumped by an annual 97 % in April to the lowest level of any month since February 1946 as factories and dealerships shut due to the coronavirus outbreak. The collapse in car sales puts more pressure on the UK economy, which is on course for an unprecedented quarterly contraction of at least 7 %, a survey showed as the coronavirus crimps activity. Lockdown measures have been in place across Europe since mid-March to contain the pandemic, shutting many companies and limiting people’s movements, with prime minister Boris Johnson expected to detail this week how measures will be slowly eased. Sales to businesses in April accounted for 4 in 5 of the 4.321 new car registrations, according to the Society of Motor Manufacturers and Traders (SMMT), which further downgraded its full-year forecast to 1.68 million sales, on track for a near 30-year low. In January it had forecast 2.25 million sales. “Safely restarting this most critical sector and revitalizing what will, inevitably, be subdued demand will be key to unlocking manufacturing and accelerating the UK’s economic regeneration”, said chief executive Mike Hawes. Britain’s car industry, the country’s biggest exporter of goods, faces losing output worth more than $9.94 billion due to the coronavirus outbreak. Output in the industry has fallen 14 % so far this year and sales have dropped 43 %. The top-selling car in Britain, normally dominated by the likes of Ford, Volkswagen and Vauxhall, was the Tesla Model 3 in April, recording 658 purchases. In February 1946, just a few months after the end of World War Two, just 4.044 new cars were sold in Britain, which was still undergoing rationing and trying to rebuild after wartime destruction, under its first majority Labour government. +++

+++ In the UNITED STATES , Texas auto dealer Hayden Elder says March was his worst month in 42 years selling cars thanks to the coronavirus, but April brought days that were “almost normal” and he expects bigger customer discounts to help him sell more Dodge Ram pickups this month. The virus outbreak and resulting stay-at-home orders have clobbered the U.S. vehicle market. But from his corner of Texas, which pushed ahead with a phased relaxation of restrictions put in place to curb the virus, Elder sees enhanced incentives from Fiat Chrysler Automobiles (FCA) playing a big part in boosting sales. “I think that will open the door for a ton of orders for the factory”, said Elder, who owns 2 Dodge, Jeep and Ram dealerships in a rural eastern region of the populous state. His businesses have remained open as they are considered essential. With levels of unemployment not seen since the Great Depression (30.3 million Americans filed jobless claims from March 21 to April 25) it is difficult to predict the level of demand for new vehicles. Jeff Schuster, president of the Americas for consultancy LMC Automotive, said the market should rebound in the second half of the year, but 2020 sales could be up to 25% lower than 2019. “Until we get plants up and running and the economy restarted, we’re in uncertain territory”, he said. That uncertainty is even greater if America experiences a second wave of COVID-19 infections. Automakers have been burning through money while their plants are shuttered. Many industry experts agree that larger discounts could generate demand and cash flow when they reopen, even if they erode carmakers’ profit margins. Used cars have been piling up at auction lots since the coronavirus crisis began. New imported vehicles now clog major ports. Dealerships across much of the country are closed. Toyota said its sales plummeted 54% in April, while Hyundai and Mazda reported drops of 39 % and 45 % respectively. As states begin to reopen, the next months will be turbulent and the pace of recovery will vary by state, industry officials, analysts and dealers said. Some automakers have already taken advantage of cheap money to offer no-interest loans for up to 7 years. Auto retailer Sonic Automotive’s chief executive David Smith said this week that automakers’ current discounts were already unprecedented. They pushed sales higher in late April and will hopefully boost them further in the second and third quarters, he said. “I’ve never seen that level of incentives”, Smith said. Automakers in the United States can look to China for some inspiration. Sales there have rebounded since virus lockdowns lifted. “My belief is that demand will come back fairly well”, Ford chief executive Jim Hackett said during an interview. Industry officials have also talked about the need for Washington to help. “Certainly we believe that some level of government stimulus post crisis to help customers and the auto industry to recover would be appropriate”, Ford’s U.S. sales chief Mark LaNeve told last month. One wild card for the new vehicle market is the way the coronavirus has disrupted the used U.S. vehicle market, where about 40 million cars and trucks change hands a year. More than 4 million low-mileage, nearly-new lease vehicles are due to return to the market this year, at a rate of around 340.000 per month. That could push used vehicle prices down in the near term, hurting new vehicle pricing and demand, industry officials said. Scott Cooke, chief financial officer of Toyota’s U.S. captive finance arm, said the Japanese automaker does not have excess inventory on dealer lots, but is seeing a build-up of customers in lockdown states unable to return vehicles that have reached the end of their lease. Cox Automotive economist Charlie Smoke said late last month that “competition for these off-lease customers will be fierce”, with automakers dangling discounts for their business. Some automakers have extended consumers’ leases to keep their cars out of the used vehicle market logjam. As of late April, used-car auction house Manheim, a unit of Cox, was holding about 40 % more off-lease inventory for corporate customers versus a year earlier, rather than flood the market and undercut resale prices. George Augustaitis, director of automotive industry analytics at CarGurus, an online marketplace for new and used cars, said automakers’ captive finance arms have many tools to manage the used car glut – from discounts, to financing deals and attractive lease programs. “That can draw people back to the new market”, Augustaitis said. The risk for automakers that offer aggressive discounts is that customers will demand them for the long term, hurting margins, said Mark Wakefield, a managing director at consultancy AlixPartners. “Those things are hard to walk back”, he said. But back in Texas, Elder said that with the right attitude and well-placed discounts, the U.S. economy will come roaring back. “It’s going to be fun around here again”, he said. +++

+++ A German federal court judge cast doubt on VOLKSWAGEN ’s reasoning after the carmaker urged the court to dismiss a claim for damages brought by an owner of a diesel powered Sharan. Tuesday’s proceedings were the first time that Germany’s Federal Court of Justice, or Bundesgerichtshof, heard arguments from a plaintiff seeking damages from VW because it had sold vehicles with manipulated diesel engines. Any ruling in this landmark case will serve as a guideline for other cases. In the United States, authorities banned VW cars from roads after the Environmental Protection Agency discovered that engine management software had been installed to mask excessive levels of pollution, triggering claims for compensation. Volkswagen has argued that because European authorities stopped short of taking VW cars off the road, compensation claims from customers were without merit. European authorities insisted that Volkswagen update its engine management software to ensure that anti-pollution filters are activated and fined Volkswagen for fraud and administrative lapses. On Tuesday, presiding judge Stephan Seiters said several arguments brought forward by Volkswagen were not applicable and agreed that the sale of a vehicle with a manipulated diesel engine does provide sufficient grounds for a damages claim. The Volkswagen customer who sued the company had already been awarded €26,000 in damages by a lower court. He sought even higher damages since he spent €31,500 on the car. The court held that the car had lost in value since the customer was using it. VW has asked the court to dismiss the claim altogether. “Unlike the preliminary views of the Federal Court, we do not share the view that the purchase of a vehicle gives grounds for damages”, Volkswagen said in a statement. Because cars in Europe never lost their road worthiness certification, VW asked for the damages claims to be dismissed. Even before installing new engine management software, Volkswagen’s cars had emitted lower levels of pollution than many competing products, VW said. “Where the damages are supposed to have occurred is not apparent to Volkswagen”, the carmaker said. A ruling will be made at a later point in time, the judge said. +++

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