Newsflash: net als een kat heeft de Volkswagen Golf 9 levens

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+++ While General Motors appears to be pulling in the reins on its autonomous vehicle program as the corona virus shutdown drags on, Ford and Volkswagen are pushing ahead with their plans to COLLABORATE on self-driving and electric vehicles. The 2 automakers expect to close their deal to move past an initial partnership on commercial vehicles and midsize pickups, which was first announced at the 2019 Detroit auto show, by the end of the month. The news comes as Cruise, GM’s self-driving subsidiary, said it was laying off 8 % of its staff, including at an engineering team in Pasadena, Calfornia, that works on Lidar technology. With production still on pause across most of North America and unemployment soaring, automakers are preparing to restart production in what is almost certain to be a weakened market. Forecasting firm IHS recently said it expects the U.S. auto market will take the biggest hit from the coronavirus pandemic, lowering its 2020 forecast for light vehicle sales to 12.5 million units, a 26.6 % drop, and 22 % lower vehicle sales globally. As a result, many automakers have looked for ways to slow the cash burn by pulling back on spending. Many companies have delayed product or production launches, including Ford’s Lincoln division, which recently canceled its plans to develop an electric vehicle with Rivian based on the latter’s skateboard platform. Rivian itself has delayed the launch of production of its own first 2 models because of the Covid-19 outbreak. Autonomous vehicles, which still face steep regulatory, technological and consumer-acceptance hurdles, seem an obvious target for cutbacks. Volkswagen reportedly remains on track to invest about $2.6 billion in Argo AI, the self-driving vehicle technology startup, while Ford has delayed its plan to roll out fleets of self-driving robotaxis and autonomous delivery pods in the U.S. by a year to 2022. Yet ironically, the economic pressures may actually quicken the development of electric vehicles, despite the high cost. A Price Waterhouse Cooper auto analyst who said the industry will be forced to consolidate the number of powertrains they focus on developing, because automakers can’t afford to have multiple options going on at one time. Ford is still planning on developing a high volume electric vehicle for Europe in 2023 using Volkswagen’s MEB platform, with a target of 600.000 units using the EV platform over 6 years. +++ 

+++ If you were hoping to see a fully-electric FERRARI within the next 5 years, chances of that happening are slim to none, according to the brand’s commercial boss Enrico Galliera. In fact, it would seem that Ferrari aren’t interested in making an EV just for the sake of it, and will only launch one once they can also tie it to some type of pioneering EV technology. The Ferrari exec went on to say that this strategy will not be offset by the arrival of new luxury super-EV makers such as Pininfarina. “There are some competitors entering the market with new technology that we will look at, but will that be a problem to Ferrari? I think not, because of the specific niche Ferrari targets”, said Galliera. “And will that trigger interest in that market for Ferrari? No. We firmly believe that battery technology is not yet developed enough to meet the needs of a supercar. In the next 5 years, we do not believe the technology will be able to meet the needs of a Ferrari”. When asked whether or not his company would be able to continue selling cars in countries which plan a sales ban on internal combustion cars, Galliera said: “We will meet all the regulations that will come into force to compete in a market, and we don’t believe that such regulations will force us to make special plans”. Still, a Ferrari EV is definitely coming. It would be pretty difficult for any carmaker to stave off building electric cars indefinitely at this point and Ferrari knows this all too well, although their timeline for one is purely dependent on technical developments. “As soon as electrified technology is developed, that will allow us to produce a car that fits with our position. Then why not? But the key is the technology: we will not just make a Ferrari that’s electric for the sake of it. If we bring in new technology, then we need to bring something new to the market. That’s how Ferrari has always worked with new technology. The evolution of new technology is 100 % in the DNA of Ferrari”. It’s also a good thing that Ferrari customers are open to electrified drivetrains, as shown by the SF90 Stradale, which is a plug-in hybrid. While discussing the SF90, Galliera revealed that his company has clients “who love using EV mode early in the morning to leave the house silently, then can use the engine and hear the Ferrari sound on the road”. Speaking of engine noise, the Italian carmaker needs to figure out a way to make its EVs sound good and thankfully the company is already thinking about this conundrum. “We are working hard on this, but I will not say if we have yet found the solution or not. But when the time comes for Ferrari to do, it will have an answer and I promise you it will be an elegant answer”. +++ 

+++ FORD ‘s launch of its latest Explorer was a mess and Ford brass knows it. That model’s woefully slow and problem-plagued launch in Chicago in 2019 won’t happen again, per Ford’s message to shareholders today Ford’s 65th annual shareholders meeting that also sought to reassure stockholders about the impact of the pandemic. The meeting was once again held virtually, a practice for the last few years, but one made necessary this year as the world strives to slow the spread of the coronavirus. And while many of the presentations and responses to shareholder questions revolved around the impact of the pandemic that stopped vehicle production around the world, executives also focused on changes made to operations in general for when the industry resumes a degree of normalcy. Which brings us back to the Explorer and the lessons it holds for the future. A year after its bungled rollout, Ford is still lamenting how it went, the losses it incurred, the blot it put on the company’s ability to get vehicles out the door and into customer hands. The learnings are crucial as Ford prepares to launch a new Ford F-150 fullsize pickup, including a hybrid version, as well as the new Bronco and Bronco Sport, a Mustang hybrid and the new Mustang Mach-E. In the past, I was told some of the problems with the Explorer were because the automaker tried to launch the next-generation SUV with many trim levels, including a hybrid and the Police Interceptor utility vehicle, while simultaneously adding the new luxury Lincoln Aviator sibling which also comes as a plug-in hybrid. It was all being done in an old plant with no room to set up a pilot area to test assembly. Keep in mind, the new Explorer switched from the old SUV’s front wheeldrive based underpinnings to Ford’s new rear wheeldrive architecture and all the sheetmetal was changed.  All this was done while maximizing production of the outgoing Explorer right up to the end. Ford president and CEO Jim Hackett called it an over-aggressive effort to launch the revamped Explorer and new Lincoln Aviator. He denounced the decision to run pilot builds virtually and says the company has fixed that and will better manage launches now. Ford is also addressing higher warranty costs by reversing past decisions to develop some of its key powertrain components remotely around the world. All these lessons learned will hopefully make Ford stronger when the world regains some normalcy. In the interim, Hackett said Ford has delayed launches from the original plan but did not specify which vehicles have been affected. Some reveals have already been delayed because of the health crisis, including the new Bronco and Bronco Sport, both of which were to have been shown to media earlier this year. But Ford officials have said key products like the F-150 remain on track. Oh, and plants were shut down around the world. “We can now see in retrospect our action to close plants definitely helped flatten the curve in geographic hot spots”, said Hackett, referring to the common phrase for the mitigation of new coronavirus cases. While there are fears of new outbreaks, Ford has returned 90 % of its salaried staff to work in China and resumed production at all plants in that country, but production is not yet at full capacity. Plants are running again in Europe, too, with a second shift added at the Saarlouis plant in Germany. North American production resumes May 18. “We don’t know yet when we will be able to get back to full production”, said chief operating officer Jim Farley. Shareholders had a lot of questions about Ford stock. Executive chairman Bill Ford said he feels the company has the right metrics in place for the future and that it is in everyone’s interests, including the Ford family, to get the stock prices back up. According to Hackett before the health crisis, Ford was on track to meet or exceed its original financial guidance. “Never before have we had to close plants in a cascade around the world”. The impact was a net loss of $2 billion in the first quarter and Ford is bracing for even worse results in the second quarter. The automaker must emerge ready to build a brighter future, Hackett said, and the company is working to protect its cycle plan, product plan, launches and technical roadmap with a focus on the long game. In the next 2 years, Ford will put 40 hybrids and electric vehicles on the road and the China market will get 30 vehicles over the next 3 years, 10 of them electric. Ford will use its partnerships with Rivian and Mahindra will help accelerate the development of electric vehicles. To preserve cash during this economic crisis, Ford is cutting spending wherever possible to have the financial wherewithal to emerge as a stronger company. Tim Stone, chief financial officer, said Ford has identified billions of dollars in opportunities. It won’t be enough to recover from all production losses this year, he said, but Ford is doing what it can to make up for the losses as soon as possible. In the meantime, the company has suspended merit increases, top executives have deferred some of their salaries for at least 5 months, cost cutting is occurring in areas such as advertising and marketing, and in areas of non-essential spending. Ford has cut its capital spending in half to about a half-billion dollars. The dividend has been suspended and will be restored when Ford is able to strengthen its balance sheet and pay down its lines of credit. In other business at the annual meeting, 13 people were elected to the board of directors and the perennial request for equal voting rights for each share was turned down with 64.9 % against. The results are not a surprise, the whole point of the proposal is to give all outstanding stock equal weight. The dual-class share structure gives the Ford family 40 % control with a small percentage of shares while non-family shares get a single vote each. The request for equality is raised every year and has received more than 51 percent support from non-family shareholders since 2011. But every year the power of the Ford family votes shoots it down. Hackett said the Ford family has been a source of stability during the pandemic. +++ 

+++ FRANCE is seeking to bolster sales of cars with lower emissions as part of a support package to be announced over the next 2 weeks for an industry hard hit by coronavirus lockdowns, Finance minister Bruno Le Maire said. Some automakers, including Renault and the PSA Group, are starting to reopen plants after closures to control the spread of the novel coronavirus. But demand was already weak even before the impact of the pandemic, which has exacerbated the financial difficulties of companies and their suppliers. Le Maire, who met with auto industry bosses, told the government aimed to use any support package or scrappage scheme to encourage a shift towards less polluting vehicles. “I will announce a support plan in order to get consumption going again, in order to help this transformation towards a more sustainable model, with particular support for the cars that emit the least CO2”, Le Maire said. Electric vehicles were too expensive for many households, Le Maire said, without giving further details of the types of measures envisaged and whether they would include direct state support for some companies. Last week, Le Maire said Renault and PSA would be required to bring more production back to France in exchange for government support. In the auto industry, Renault is in particular focus. After posting its first loss in a decade last year before the pandemic hit, it is first in line in the industry for a state-backed loan, which should amount to around to €5 billion ($5.40 billion), Le Maire has previously said. Some suppliers have struggled to tap state aid schemes, which are funneled through commercial banks. Novares, which makes plastic components for cars, went into temporary receivership at the end of April after failing to reach a rapid agreement with its lenders to solve a cash crunch. +++ 

+++ GENESIS dealers in the United States have been clamoring for a SUV and their prayers were finally answered when the company unveiled the GV80 in January. It appears the model arrived not a second too soon as North America boss Mark Del Rosso told the company has already received nearly 10.000 reservations for the luxury SUV. That’s a huge accomplishment for Genesis as the company only sold 21.233 vehicles in the United States last year. More specifically, the 10.000 units are more than the combined American sales of the G80 and G90 sedans in 2019. The GV80 will go on sale in the United States this summer and pricing starts at $48,900. The entrylevel model features rear-wheeldrive and a turbocharged 2.5-liter 4-cylinder engine that develops 304 hp. The model also has LED lighting units, 12-way power heated front seats and leatherette upholstery. Buyers will also find piano black trim, a dualzone climate control system and an infotainment system with a 14.5 inch display. Buyers can also get all-wheeldrive and a twinturbo 3.5-liter V6 engine with 380 hp. In top spec, the GV80 has host of amenities including Nappa leather seats, a 12.3 inch digital instrument cluster and a power second row with heating and ventilation. While the coronavirus has impacted a number of upcoming models, Del Rosso said the GV80 is “100%” on track and they’re in a “perfect position from an inventory perspective”. However, he did suggest demand is exceeding expectations so they might have built “one too few”. +++ 

+++ General Motors’ February decision to shutter the HOLDEN brand in Australia by 2021 was a massive shock, but only the first. The aftershocks continue to whip up turmoil. The latest jolt comes courtesy of a federal government senator from the state of Queensland, James McGrath. For any who don’t know, Queensland could be compared to Florida in terms of antics, with a better accent and more panache. McGrath made an extraordinary speech in Australia’s federal parliament that included the lines, “General Motors may think the rich history of the Holden brand is worthless, but I think it’s priceless. If General Motors thinks the brand is worth nothing, then hand the brand back to Australia. Give it back to the Holden dealers. Indeed, I’m happy to purchase the Holden brand off General Motors for a dollar. I will send you, Ms. Barra (General Motors’ CEO, red.), a dollar in the post and you can give us the Holden brand back and we will give it to the Holden dealers”. First, a brief recap of how it got to that point. After the closure announcement, GM made a compensation offer to the 185 dealer groups operating 203 Holden storefronts in the country. The math was “based on each showroom’s average net profit from all new Holdens sold over 3 years from 2017 to 2019 (but based volume on the number of vehicles sold in 2019), that amount forecast over the remaining term of their franchise agreements which were due to expire at the end of 2022”, and took into account “unamortised costs of facilities such as showrooms and signage”. The dealers unanimously rejected compensation paying from $100,000 to $2.4 million depending on the store, roughly $1,500 per new car sold. Then they met with Australia’s prime minister over the matter and hired law firm HWL Ebsworth (HWLE) to handle their claims. HWLE ran numbers based on the dealers’ requests and came up with a compensation figure of $6,110 per new car sold, plus a lot of invective aimed GM’s way, including the bombshell that GM planned to close Holden at least 5 years ago but hid its intentions behind a smokescreen of investments. GM bashed the number, citing “a number of inaccurate claims, assumptions and costs allocations” and knocked back “baseless allegations of unconscionable and misleading conduct which are plainly wrong and unsupported by fact or law”. GM appointed PriceWaterhouseCoopers (PWC) to run an analysis, PWC finding Holden dealers are entitled to anywhere from $350 to $1.409 per new car sold, even less than the original offer. In the midst of all of this, Senator McGrath used plain-speaking North Queensland language to blast GM for having “the ethics of a granny-smacking purse-snatcher” in its negotiations with Holden franchisees. McGrath touched on that comment again in his parliament speech, doubled down with, “And nothing I have heard from Holden dealers throughout Australia since then has changed my view or that of my colleagues in this parliament”, accused GM of “American legal chicanery” by using the coronavirus pandemic to drag out negotiations and compel “further oppressive agreements”, called CEO Marry Barra “Gordon Gecko on steroids”, made the offer to send Barra $1 Aussie and closed with: “Australia and Holden dealers want a fair deal. They don’t want a special deal, they just want a fair deal”. If not Barra, we’re sure someone at GM would be thrilled to send McGrath one U.S. dollar, worth about $1.30 Aussie, and let him keep the change in order to be to done with Holden. We’re equally sure Holden dealers would consider that “the worst trade deal maybe ever signed anywhere”, with a dollar to split between them and the Aussie taxpaying public their only chance for compensation. In response to McGrath’s speech, a Holden representative told: “GM Holden firmly believes the compensation offer to its dealers is fair, and strongly disagrees with any assertion that it has acted improperly. We remain open to meet for a constructive purpose with dealers”. Calm for now, but the next shock can’t be far away. +++ 

+++ Daimler is suspending production at a MERCEDES-BENZ plant due to a shortage of parts supplied from Mexico. The Vance, Alabama, operation will not build SUVs next week, according to an internal notice. Workers are being given the option to use vacation time or go without pay and file for state and federal unemployment benefits. The Mercedes plant reopened late last month after idling for 5 weeks as much of the U.S. manufacturing base shut down to contain the coronavirus outbreak. Now, as U.S. automakers plan to restart their operations beginning next week, Mexico’s government has sent mixed messages as to how soon it will allow auto companies to reopen. After sending several conflicting messages over the past 3 days, Mexico said that plants can reopen before June 1 if they follow various safety protocols. Numerous automakers and suppliers are confident that their protocols will keep employees safe as they restart production throughout North America next week. Daimler representatives in Germany and the U.S. did not immediately comment. The company said in its internal notice to workers at the plant in Alabama that the factory will schedule makeup production for June 29 through July 1, a week that the factory had been slated for a summer shutdown. The facility builds the GLS and GLE. +++ 

+++ While president Donald Trump recently threw his support behind Elon MUSK ’s decision to resume production at Tesla’s California factory, that doesn’t mean the automaker is out of the woods just yet. On Wednesday, a lieutenant with the Fremont, California, police department visited the factory late in the afternoon to see if the company is adhering to safety protocols agreed to with the county. It is understood the lieutenant viewed employee screening and physical distancing measures while also confirming the universal use of face coverings. Tesla was notified of the police visit beforehand and findings will be presented to the public health officer for Alameda County, which will then determine compliance. On Tuesday evening, Alameda County issued a statement saying it had held discussions with Tesla representatives about their safety and prevention plans and agreed “that Tesla can begin to augment their Minimum Business Operations this week in preparation for possible reopening as soon as next week”. Curiously, this statement came more than a day after Musk said Tesla had already resumed production and after employees claim they actually started building Model 3 and Model Y vehicles last weekend. Musk has been an outspoken critic of the lockdown responses to the coronavirus pandemic and has pushed for the country to reopen. Despite appearing to blatantly and knowingly disregard stay-at-home orders in Alameda County in resuming production before given official approval, it seems unlikely Musk or Tesla will face any kind of penalty. Shortly after it was revealed that Tesla had resumed operations at its factory in Fremont, a handful of employees claim they feel pressured to return to work. One such employee is 25-year-old Jessica Naro. She works the night shift at the plant and was told she would need to report back to work. Her first thought was that doing so wasn’t safe, particularly due to concerns that she could be exposed to the virus and pass it on to her 6-year old child who has a condition that could have serious complications if he contracts Covid-19. In a recent email sent to employees, Musk said that if workers “feel uncomfortable coming back to work at this time, they shouldn’t feel obligated to do so”. However, Naro says that her supervisor told her over the phone that if she chose not to return to work, she could be terminated. In a subsequent email, there was no mention of possible termination, but she was told she would no longer be eligible for unemployment insurance and could use unpaid leave without being penalized if she decided not to return. 36-year-old Carlos Gabriel claims to be in a similar position. While assured that he won’t lose his job for not returning to the plant, Gabriel said he will be taken off furlough status. “I don’t think that’s a choice for me. I find my life to be a little more valuable”, Gabriel said. “You’re asking me to liberate myself from my home to go and risk my life? You call that freedom?” Another worker has told that he was called last week and told he’d be taken off furlough status if he didn’t agree to return to work. He chose not to. University of California, Berkeley law professor Catherine Fisk says employees are protected from retaliation, including firing, if they refuse to perform an unlawful act. If Alameda County, where the Tesla factory is located, prohibits the automaker from resuming operations, employees can lawfully refuse to work. “The problem for the workers is that it’s one thing to have a viable claim for an unlawful firing, and it’s another thing to have a job”, Fisk said. “Having a possible lawsuit does not pay the rent or put food on the table. And Tesla knows that. So the threat is very likely to intimidate some workers to force them to work”. It remains unclear if Tesla employees will be allowed to refuse to return to work as Alameda County recently said it will allow the company to resume operations at the plant. +++ 

+++ In the United States, the ‘Big Three’ planned to resume domestic manufacturing after the enforced hiatus and, with all hope, can begin piecing together firm timelines for many delayed orders of business. A couple of days ago, a leaked bulletin showed Ford waiting to open the order books for the new F-150 by a month, and holding off production by about 2 weeks at its Dearborn Truck Plant and Kansas City Assembly Plant. In March, Ford told: “Our proactive precautions have not impacted the scheduled launch of new vehicles at this time, including the Ford Bronco and F-150, although we have re-timed some media programs”. Much has happened in the meantime. The 2021 Bronco and MUSTANG MACH-E have also been placed in the queue, with manufacturing for each vehicle set back by 2 months, about as long as the shutdown has persisted. Ford lost $2 billion in the first quarter of 2020 and in April forecast a loss of $5 billion for the second quarter, the company forced to watch the financial conflagration while its profit-pumping fire trucks are stuck in the garage. With manufacturing back, Ford says it will spend the money it takes to get the trucks to dealers and customers. The head of product development and purchasing, Hau Thai-Tang, told Bank of America analysts, “We’re not going to do any additional delay to these launches beyond the impact of Covid-19 as a mechanism to conserve cash”, adding: “But we expect the launch delays to be commensurate with the duration of the shutdown period”. Bronco Sport production had already been pushed back 2 months, to September 7, at Ford’s Hermosillo facility. Based on the latest publicized timeline, the Job One for the F-150 happens in Dearborn on October 12 and in Kansas City on November 9. I had previously never gotten dates for Bronco and Mach-E production any more specific than “fall” and “availability late this year”. I know Ford’s Cuautitlan Stamping and Assembly Plant (CSAP) in Mexico produced pre-production Mach-Es in February. Also in February, Ford said the Mach-E would launch in Europe and the U.S. simultaneously, and in late April, Ford Norway sent customers an update that deliveries of the electric crossover would begin in November as planned. With a 2-month delay, that takes EV deliveries into January 2021. Production of the 2021 Bronco is likely in that October / November window as well. Ford has detailed a new over-the-air update system that will continue to enhance its Mustang Mach-E over the course of its life. The wireless software tweaks can be made anywhere and are said to be ‘virtually invisible’ to Mach-E owners, taking less than 2 minutes in some cases. Complex updates that require more downtime can be scheduled for a convenient time, such as the middle of the night. Ford expects the first round of over-the-air updates to be rolled out to Mach-E owners within 6 months of the first customer deliveries. Owners will be notified of the available update, which can then be activated using a wi-fi or cellular connection. +++ 

+++ NISSAN is in talks with alliance partner Renault to build 2 of the French brand’s SUV models at its Sunderland plant. The Kadjar and Captur, which share their platforms with Nissan’s Qashqai and Juke respectively, are currently built in Spain. However, the 2 brands are looking to consolidate production, as well as boost the fortunes of Sunderland, Nissan’s flagship international factory. A major reshuffle is expected to result in Nissan cutting its overall production capacity by 20 % in 2023, closing the firm’s Barcelona plant, which makes commercial vehicles for export. That plant had been running at just 30 % capacity, reports suggest. A decision to move production of 2 of Renault’s most popular models to the United Kingdom would likely secure thousands of jobs at Sunderland. The plant’s future had been in doubt following Britain’s decision to leave the EU, with Nissan warning that tariffs on exports into the EU would put it in jeopardy. The move would also point to a reunification between Nissan and Renault, a relationship that looked strained after the arrest and subsequent escape of former alliance boss Carlos Ghosn. Ghosn was instrumental in forming the alliance between the French and Japanese makers, which was at one time the world’s largest car-making group. Since then, in-fighting is said to have caused a rift between senior executives. The full strategy of restructuring Nissan’s European business will be outlined by new Nissan CEO Makoto Uchida on 28 May. The brand has struggled in the region, with problems being greatly compounded by the coronavirus crisis. +++ 

+++ Volkswagen isn’t shy of its future EV plans but now there’s a new report saying that the German carmaker will include turning the R BRAND into an electric performance brand. VW Group board member Jürgen Stackmann that future ‘R’ models will not only be exciting cars but will also go electric. “The future of R needs to be, and will be, electric”, Stackmann said. “We’re still working on what we started 2,5 years ago (which was obviously not electric, though exciting), but the work going forward is and will be electrified”. The electric future of the R brand has already started of course, as VW recently revealed the Touareg R, the first R model fitted with a hybrid powertrain. The range-topping version of the German SUV is powered by a plug-in hybrid powertrain that combines a 340 hp 3.0-liter V6 with a 130 hp electric motor and a 14.1 kWh battery pack for a combined 456 hp. And let’s not forget the ID.R, VW’s battery-electric missile which has destroyed a number of lap records across the world. Putting that R badge on it is a sign of things to come. However, friends and fans of the internal combustion engine will still get their fix from VW’s R division as the company is putting the final touches on the new Golf R. The range-topping version of the Golf family will continue to offer a turbocharged 2.0-liter four-banger strapped to an all-wheeldrive system and hopefully will retain the title of the best “one-car-to-do-it-all”. +++ 

+++ SUBARU posted a 15.7 % rise in annual operating profit in the fiscal year that ended in March as it recovered from a raft of product recalls last year, but warned that sales of its cars would take a hit from the coronavirus outbreak. Profit rose to 210.3 billion yen ($1.96 billion) for the year just ended, from 181.7 billion yen a year earlier under international financial reporting standards. It exceeded a consensus estimate of 204.7 billion yen profit drawn from 17 analysts. Global automakers are struggling to recover from the coronavirus, which has pummeled car sales as shelter-in-place orders in many countries clobbered car demand, while plant workers had been left unable to commute to work. Though Subaru and its rivals have begun to restart vehicle factories, anaemic demand, supply chain disruption and social distancing measures at factories are expected to limit output in the coming months. “We saw a limited impact of the coronavirus on our results for the year just ended”, chief executive Tomomi Nakamura told. “But although we have resumed production this month, we are only operating one shift in Japan, and the pace of U.S. output has slowed significantly. We see many uncertainties related to the virus”. As a result, the maker of the Outback and Forester declined to give an earnings forecast for the current business year, while it slashed its year-end dividend for the year just ended by 61 % to 28 yen per share. Some analysts believe industry-wide global auto sales could slump by a third this year and that any recovery will be slow and patchy as job losses and reduced incomes weigh on consumer spending. Subaru, which earns twothirds of its vehicle sales from the United States, acknowledged that it may take a hit in the coming months as its biggest market struggles get the coronavirus pandemic under control. The automaker saw a 3 % rise in global vehicle sales in the year to March to 1.03 million units, bouncing back from last year, when a defective steering component and measures to improve inspection tests had stopped output for 2 weeks at its sole assembly plant in Japan. The process to restart its U.S. plants would take time, Subaru said, and it expects to produce only around 5.000 units this month; a fraction of last year’s 40.000. The virus would result in a global production hit of around 150.000 units, it added. The automaker said it had secured a 200 billion yen credit line from its lenders to see it through the coronavirus. It has been improving its free cash position over the past year, but warned that its coffers would take a hit through June. +++ 

+++ TESLA has picked Austin (Texas) and Tulsa (Oklahoma) as finalists for its new U.S. assembly plant, a person briefed on the matter said. The person says company officials visited Tulsa in the past week and were shown 2 sites. It wasn’t clear if there were any other finalists in the mix. The person, who didn’t want to be identified because the site selection process is secret, said no final decision has been made. The new factory will be Tesla’s biggest so far. The electric car maker has said it wants the factory to be in the center of the country and closer to East Coast markets. The stakes are high for state and local governments, which covet auto factories because they have a lot of workers and normally pay well, generating income and property taxes. Tesla’s current U.S. vehicle assembly factory is in Fremont, California, which employs 10.000 workers. The company has a second U.S. factory in Reno, where it builds batteries for its vehicles and employs about 6.500 people. It also has a factory in Shanghai and another one under construction in Germany. Companies typically use proposals from finalists to bargain for the best package of tax breaks, site investments and other incentives. The new factory would build Tesla’s upcoming Cybertruck as well as be a second site to build the Model Y crossover. On the company’s earnings conference call in April, Musk said the site of the company’s third U.S. factory could be announced within a month. Musk calls his plants “Gigafactories”. The respective mayors, Steve Adler of Austin and G.T. Bynum of Tulsa, as well as Oklahoma governor Kevin Stitt, all declined comment on whether their cities are finalists for the plant. However, all reasserted their respective locales would be best suited for the plant site. Earlier this week, Musk threatened to move manufacturing and Tesla’s headquarters out of California in a fight with San Francisco Bay Area health officials over whether the Fremont plant could reopen after being closed to stop the spread of coronavirus. He defied an order to stay closed and the plant was running for 2 days before the Alameda County Public Health Department announced a settlement. The department said the plant could run above minimum basic operations this week and start producing vehicles, as long as it delivered on promised safety precautions for workers. It would be difficult for Musk to move out of Fremont, though, because Tesla would have to take its only U.S. assembly plant offline for months while it moved heavy equipment to another location. It also would be hard to move the headquarters in Silicon Valley to another state because software engineers and other technical workers likely wouldn’t want to relocate and could find work elsewhere in the area. +++ 

+++ When TOYOTA introduced 2 new vehicles, its executives didn’t brag about them from an elaborate stage inside a convention center. Instead, the new Sienna minivan (first photo) and a revived Venza midsize SUV (second photo) were shown online from the company’s nearly deserted U.S. headquarters and from the driveway of an executive’s home. Both were supposed to be unveiled at the New York International Auto Show in April, but the show was postponed until late August due to the novel coronavirus. That would have been too close to when Toyota’s vehicles would reach showrooms, so the company decided to go on its own. The move may be a sign of things to come for New York and other shows. Some automakers already were starting to pull out of auto shows, citing costs and the ability to do events on their own. That left fewer models for consumers to browse at the shows. Now doing it online could be a viable solution, possibly causing more automakers to leave the shows. In addition to Toyota, Nissan is planning to show an updated X-Trail, its top-selling model, at a virtual event in June. Ford has delayed the debuts of a new F-150 pickup and Bronco SUV, while General Motors held off on unveiling a new battery powered Cadillac SUV. Those, too, could be done online, although no one is sure if the virus will start a trend. “I don’t know if unveiling an all-new model from my house is getting back to a new normal, but let’s see how it goes”, Jack Hollis, head of the Toyota division in North America, said while showing off the Venza from his driveway. Sales chief Bob Carter unveiled the Sienna from the company’s near-empty U.S. headquarters in Plano, Texas. Yet even if there aren’t as many models, attendance by consumers is holding up at most shows. “What is often forgotten is that after press days are over, hundreds of thousands of people go to auto shows”, said Dan Bedore, who helped plan auto shows when he worked for Ford, Hyundai and Nissan and now works for a public relations agency. Mark Schienberg, president of the New York International Auto Show, notes that even though German luxury automakers Mercedes and BMW and Audi pulled out of this year’s New York’s show, the number of model debuts at the show has remained consistent at more than 50. The New York show, which Schienberg says consistently draws over 1 million people per year, will remain popular for both consumers and media, letting automakers get their message to the world. “It’s about the consumer. It’s about getting them excited about the vehicles. Seeing all the cars under one roof. That’s what makes auto shows unique”, Schienberg said. The auto show in Geneva was the first to outright cancel its event, which had been scheduled in early March when the coronavirus was spreading to more countries. Organizers of Detroit’s big auto show were also forced to cancel their June event. The Detroit show had a strong lineup of debuts this year and is expected to next year “despite whatever trends you are seeing or watching”, said spokesman Brent Snavely. Online events can’t match the in-person experience of seeing the vehicles, Snavely said. It’s still unclear whether the coronavirus will prompt more online events. “Things are so fluid right now”, said Curt McAllister, a Toyota spokesman. “You have to use technology to its full advantage at this point in time”. Both new Toyota vehicles will only be offered in gas-electric hybrid versions. The Sienna and the Venza will have Toyota’s electronic safety suite, including automatic emergency braking, as standard equipment. The Venza goes on sale this summer while the Sienna reaches dealerships late this year. Prices weren’t announced. +++ 

+++ In the UNITED STATES , the ‘Detroit Three’ automakers and their suppliers began restarting assembly lines on Monday after a 2 month coronavirus lockdown in a slow revival of a sector that employs nearly 1 million people in the United States. On a chilly and damp Monday morning, hundreds of workers at Fiat Chrysler Automobile’s (FCA) truck plant in Warren, Michigan began lining up before 4 a.m. to start the 5 a.m. shift. Signs overhead read: “Let’s restart”. “I’m a little nervous”, said Larry Smith (53) of New Baltimore, who works on wheel alignment away from the assembly line. “They made all the precautions and they’ve done everything they can to prepare us. I’m trusting in God”. Detroit automakers on Monday said there were no issues with absenteeism as the plants opened. FCA reopened 4 assembly plants on Monday, including Warren Truck, on a single shift, as well as 4 parts plants. The reopening of car plants will be a closely watched test of whether workers across a range of U.S. industries can return to factories in large numbers without a resurgence of infections. General Motors (GM), Ford and FCA have all been preparing for weeks to reopen their North American factories in a push to restart work in an industry that accounts for about 6 % of U.S. economic activity. Investors welcomed the gradual restart, sending GM’s shares up more than 9% on Monday. FCA shares rose 7.3%, while Ford’s were up 6.7%. Auto companies have redesigned assembly lines and retrained workers in an effort to avoid coronavirus outbreaks that could derail production again. Workers entering factories on Monday were checked by temperature monitors. Face masks or shields are standard protective equipment. Jobs such as installing seat belts that used to require two or more workers to get close together inside a vehicle have been redesigned to keep people a safe distance apart. Plastic screens have been installed along assembly lines to separate workers leaning in to the engine compartments of vehicles. Break areas have been reconfigured to keep workers six feet apart. The Detroit automakers have collaborated with each other and with the United Auto Workers to develop common coronavirus safety practices. Other automakers in the United States are adopting similar safety measures. Wearing a black Detroit vs Everybody face mask as he entered FCA’s Warren Truck plant early Monday, production operator Laruante Gary, a Detroit resident who installs doors on Ram pickups, said: “I expect to see things cleaned and safety protocols being observed, and I expect us to know something as far as the next steps for us”. Another production worker at the plant, Sean Reid (37) of Belleville, expressed concern over the earlier virus-related deaths of several U.S. auto workers, including one at Warren Truck. “I don’t know where people have been, I don’t know what they’ve been doing”, he said. “I don’t like it, but what can I do, really?” The Detroit automakers have many older workers in states such as Michigan that were hit hard by the pandemic. Theresa Segura, 61, of Lincoln Park, arrived for work at the FCA Warren plant but was immediately sent home after noting on an FCA questionnaire that she had been exposed to a family member who had just tested positive for the virus. Segura, who has worked at the truck plant since 1993, said she thought that it was in any case too soon to reopen “because there are still people sick out there”. “We’re risking our lives going in there”, said Segura, who works as a floater, moving from job to job at the plant as needed. Some non-union automakers in the southern United States reopened earlier this month. Tesla began building vehicles last week in defiance of a shutdown order in Alameda County, then stopped and agreed to reopen again Monday. For the automakers and their suppliers, many of which began reopening their plants last week, the restart is critical to ending the cash drain caused by a two-month shutdown forced on them by Covid-19. The emphasis is on getting assembly lines again producing such profitable vehicles as GM’s Chevrolet Suburban SUV, Ford’s F-150 pickup and FCA’s Jeep Wrangler SUV. “Ultimately we’re in this together. Because if we don’t build trucks, Ford is gone”, said Todd Dunn, president of UAW Local 862, the union that represents more than 14.000 hourly workers at Ford’s 2 Kentucky assembly plants, which build trucks and SUVs. The UAW’s Dunn said one question will be how many Ford workers punch in at his local production facilities this week given a lack of daycare in Kentucky, where schools are closed, as well as fear among those with underlying health conditions who are at greater risk. Ford has been hiring temporary workers to cover absenteeism, he said. President Donald Trump on Thursday will tour a Ford manufacturing plant in Michigan that has been repurposed to make ventilators and personal protective equipment, according to the White House. GM is reopening a number of plants on 1 shift, including 1.600 hourly workers making pickups in Flint and 1.600 workers manufacturing pickups in Fort Wayne. Another issue automakers will have to watch closely is the financial health of suppliers. As most suppliers get paid on average 45 days after they deliver parts, some will struggle to stay afloat as the industry slowly reopens, analysts say. +++ 

+++ Iconic VOLKSWAGEN nameplates such as the Golf, Polo and Passat could become extinct in markets that will at one point only allow sales of fully electric cars. In fact, some countries could ban internal combustion engines as early as 2030. When asked if the Golf still had a future alongside the ID family, the brand’s sales and marketing boss, Jurgen Stackmann responded by saying “Probably not”. Before that day comes, Stackmann still expects to see a 9th generation Golf. “I am convinced that you will see Golf IX coming. I think Golf will have a lot of interesting technologies until the boundary of full electric. The fully electric ID goes into the ID family and that decision is of a divide within the family”. “So for full electric, we want to have optimized platforms doing just electric and they will be called ID for the future”. The latest eight generation Golf will feature electrification too, but only in mild hybrid and plug-in hybrid form; the same goes for the Passat with its GTE derivative. However, while the likes of the Golf could cease to exist in future EV-only markets, VW’s iconic nameplates should still endure on a global scale. “Golf will remain as a strong effort of the brand in many places and I believe in Europe as well, but in many places outside Europe where they probably don’t have the capacity to go full electric so fast”, added Stackmann. “So I’m convinced that we will see a parallel run of the Golf 9 and the next generation ID. What technology the Golf IX will bring we will see. It will again be leading edge as we are now seeing with Golf VIII; whenever we come with next generation Golf, it will be a mark for the rest of the industry to beat for the next 5 or 6 years to come”. Yet, the VW exec kept leaning towards the Golf being forced out by something like the ID.3 when asked whether or not people will still be able to purchase a Golf when bans on internal combustion goes into effect.
“Probably not”, he said. “Because you would probably be a very happy ID.3 owner and we’d be very happy as well”. If I was in charge of Volkswagen, I would look at this as quite a big dilemma. Do you simply allow such an iconic nameplate like the Golf to become extinct just because certain markets will only allow for the sale of fully electric models? Sure, technically you’d have no choice if that’s suddenly the situation tomorrow. But there’s plenty of time for Volkswagen to regroup and come up with a fully-electric Golf, Passat or Polo. Of course, that would influence ID range sales so in the end, it’s a bit of a mess really in terms of marketing.
Would you be happy with a ID-branded product instead of a fully-electric Golf or Passat? +++
 

+++ Any scrappage-like schemes to subsidise sales of conventionally powered cars after the coronavirus crisis risk being “a waste of money”, the boss of VOLVO has argued. Håkan Samuelsson said that only restarting or enhancing existing incentives on electric vehicles would help manufacturers and respond to consumer trends. “If you do scrappage schemes then you should do what you would do anyhow”, Samuelsson told. “It’d be good to promote new technology: good for governments to support electric vehicles, which are more expensive in the first years”. He added: “I believe that after coronavirus it would be naive to expect everything to return to normal, to think that consumers will come back into showrooms asking for petrol or diesel cars. And if governments in some way subsidise a return to the old world, it’ll be a waste of money. They should use the money to promote new technology, as they were planning to do before coronavirus”. Samuelsson said that Volvo, which has restarted production at many of its factories, had been “encouraged” by the recovery of demand for cars in China. But he conceded that the global car market was running at a fraction of its regular capacity. “The problem is not production; the problem is the demand from customers”, he said. “We cannot produce more than we sell. So right now we have couple of days per week when we shut down and send people home”. He said that “revenge buying” could become a trend, where people exasperated at long periods confined to home are more ready to make purchases once lockdown has lifted. “People need to be able to move, come out of quarantines and to our showrooms”, Samuelsson said. “But based on the China experience it’ll bounce back quickly”. +++

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