Newsflash: Jaguar Land Rover zet vol in op waterstof aandrijving

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+++ China’s CATL will invest 19.07 billion yuan ($2.75 billion) in businesses in the upstream and downstream sectors to recover its competitive edge, the company said last week. The announcement comes 2 months after it lost the crown of the world’s largest power battery maker to LG Chem. The investment targets are Chinese and foreign companies along the industry chain, and the amount of money appropriated overseas could reach $2.5 billion, the Shenzhen-listed company said in a filing. CATL said the decision was based on the company’s “long-term strategic development” and the goal is to further enhance its competitive edge in the power battery sector. CATL has stakes in around 45 companies, 11 of which are wholly-owned. Most of them are companies in the battery materials and mobility industries. CATL shipped the equivalent of 40.25 gigawatt-hours of automotive lithium-ion batteries in 2019.The company is an industry leader with a global share of 28 %, according to South Korea’s SNE Research. Most of its products are sold in China, which is the world’s largest electric car market. Statistics from Soochow Securities show that CATL has a roughly 50 % market share in China. Major customers include Yutong, Nio, Great Wall Motors and WM Motor. Overseas, CATL has big names on its list of customers, including Daimler and Volkswagen. But their sales have been quite small. Panasonic is Tesla’s major battery provider. The coronavirus pandemic and falling sales of electric cars in China have hurt CATL. New energy vehicle sales started to fall in July 2019, and did not rise again until last month. Xu Haidong, vice-chief engineer of the China Association of Automobile Manufacturers, said sales this year could reach 1.1 million, down from 1.2 million in 2019. CATL’s installed capacity totaled 10 GWh in the first half of the year, down 28 percent from the same period in 2019. To make things worse, LG Chem overtook it as the world’s largest battery maker, with its installed capacity surging 82.8 percent to 10.5 GWh in the same period, according to SNE Research. At an industry forum, CATL founder and Chairman Zeng Yuqun said new energy vehicle sales surged 52 % in Europe but fell 44 % in China. “That means China may lose its No 1 position to Europe this year”, Zeng said. China overtook the United States as the world’s largest electric car market in 2015 and has held the title since then. “The idea of Europe surpassing China this year makes me sad”, Zeng said. CATL is thus speeding up its overseas business. Earlier this month, Mercedes-Benz said it has entered the next stage of a strategic partnership with CATL, which covers the full range of battery technologies, from cells across modules to entire battery systems. This agreement also involves CATL’s cell-to-pack design, which eliminates conventional modules and integrates the cells directly into the battery. “Working with CATL will see us accelerate our transformation towards carbon-neutrality”, said Markus Schaefer, a board member of Daimler and its subsidiary Mercedes-Benz. The 2 companies have started working on battery products that are to be featured in a number of vehicles within the next few years. The EQ S sedan, which is to be sold in 2021, will feature CATL cell modules. It will have a range of 700 kilometers and its charging time will be faster compared with current models. CATL is building a plant in Germany, which will make it easier for Mercedes-Benz to purchase their battery products. Zeng Duohong, a senior analyst at Soochow Securities, is optimistic about CATL’s prospects. In a research report, she estimates CATL’s overseas shipment could reach over 10 GWh in 2021, double this year’s level. The company’s shipment could reach 350 GWh in 2025, almost 9 times its figure in 2019, according to Soochow Securities. But Zeng said China will remain CATL’s major market. “In the long run, we estimate it has a 40 % market share in China and 20 % overseas”. +++ 

+++ CHINA ‘s 11 major auto producers saw their output expand in the first 10 days of August, industry data showed. The auto output of these carmakers totaled 473.000 units; up 11.2 % year-on-year, according to a report released by the China Association of Automobile Manufacturers. However, the figure marked a 24 % decline compared with that in the first 10-day period of July, the report added. In breakdown, the output of passenger cars rose 6.8 % year on year to reach 415.000 units in early August, while that of commercial vehicles surged 58.1 % year on year to 58.000 units, the data showed. Domestic automakers secured a market share of 35.1 % in China’s passenger vehicle segment in July; an increase of 1.7 percentage points from June, prompting cautious optimism from local industry insiders. In July, 585.000 Chinese-branded passenger cars were sold, a year-on-year growth of 4.5 %, the China Association of Automobile Manufacturers said. Over the first 7 months of the year, Chinese brands sold 3.43 million vehicles; down 25 % from the same period in 2019. “Recovery of sales of China-branded passenger vehicles signals purchasing power is being released after pent-up demand caused by the Covid-19 pandemic”, said Xu Haidong, vice-chief engineer with the CAAM. “However, explosive growth is not expected, which is instead determined by overall product competitiveness”. Xu added there is a serious polarization among Chinese automakers in terms of market share. The front-row players, including Geely, Great Wall Motors and Changan Automobile, have a much larger market share than many of their peers. Statistics show Geely sold 105.218 vehicles in July; up 15 % year-on-year. Great Wall Motors sold 78.339 vehicles last month, of which 23.723 were its H6 model, the automaker’s best-selling model. Meanwhile, Changan sold 123.548 of its Chinese-branded vehicles in July, up 49.9 %. The 3 automakers rank among the top 15 Chinese automakers in terms of sales between January to July, according to statistics from the CAAM. With total sales of 753.000 vehicles in the first 7 months of this year, Changan ranked second in the top 15 list, following SAIC Motor with a sales volume totaling 1.08 million. Geely, with a sales volume of 636.000 between January and July, took third place. Great Wall Motors ranked fifth, with sales of 404.000 vehicles during the period. In July, China produced 2.2 million passenger and commercial vehicles; down 5.3 % month-on-month. A total of 2.11 million were sold in July, down 8.2 % month-on-month. However, the figures were up 21.9 % and 16.4 % respectively year-on-year, according to the CAAM. A total of 1.73 million passenger vehicles were produced with 1.67 million sold in July. The figures were down 3.9 % and 5.6 % respectively month-on-month but up 13.2 % and 8.5 % year-on-year. From January to July, China produced 12.31 million vehicles and sold 12.37 million. It marked a decrease of 11.8 % and 12.7 % respectively from the same period of 2019. There were positive signs for new energy vehicles in July with 98,000 sold; up 19.3 % from the previous year, the first increase of 2020. In the first 7 months, China produced 496.000 NEVs and sold 486.000 units; down 31.7 % and 32.8 % respectively year-on-year. With the scaling back of government subsidies for NEVs since the second half of 2019, there has been a sales decline that has lasted for around a year, according to Xu. “After nearly a year of strategic adjustment, new energy vehicle companies are on the right track and individual consumption is dominating the NEV market. These are key factors to ensure the steady development of the market”, Xu said. “We estimate total NEV sales will reach 1 million units this year in China, excluding the sales of Tesla”. Chinese-branded vehicles have taken more than half of the domestic automobile market share, and 40 % passenger vehicle market shares, Fu Bingfeng, deputy secretary general of the China Association of Automobile Manufacturers, said. The country has topped the global auto market in sales for 11 consecutive years, and taken up one-third of the world’s market, Fu said, adding that the number of vehicles in China is set to reach 270 million units by the end of this year. Chinese-branded vehicles are benefiting from the country’s huge automobile market, he said. Wang Xiaoqiu, president of SAIC Motor, said the Chinese vehicle sector is rebounding rapidly thanks to the support of the government. Wang added that the rebuilding of the company’s brand was directed by younger consumers and the upgrading trend of consumption. Wang also noted that cooperation among Chinese brands is vital in tackling core technologies in key areas such as internet connected vehicles. The global automobile market has seen sales slump amid the coronavirus pandemic, while the Chinese market has rebounded since May, indicating market resilience and positive effect of policies, said Christoph Wolff, member of the executive committee at the World Economic Forum, who noted that the Chinese experience is referential to the global market recovery. The adjustment of industrial policies has provided more opportunities for multinational car makers in China, the report said. As the country lifted restrictions on foreign equity shares in new energy vehicle manufacturing, Tesla launched its first mega-factory in Shanghai and unveiled its China-made Model 3 in November last year. Volkswagen also closed its 1 billion euro deal in acquiring 50 % stakes of its electric-vehicle partner JAC Motor this May. The next 5 years will be the key period for the upgrading and transformation of China’s auto industry, Fu said, suggesting industry players should seize the opportunities and expand their footprints in both domestic and overseas markets. +++ 

+++ In South Korea, Hyundai’s premium brand GENESIS surpassed Mercedes-Benz in sales for the first time in four years in the local market, industry data showed. According to the auto industry, Genesis sold 60.005 vehicles in the January-July period this year, while Mercedes-Benz and BMW sold 41.583 and 29.246, respectively. Sales of Genesis jumped 65 % compared to the same period last year. Mercedes-Benz, on the other hand, increased 3 % and BMW rose by 35 %. In 2016, the year after the brand was launched, sales of Genesis (66.278 units) were ahead of Mercedes-Benz (56.343) and BMW (48.459). That year, the G80 with minor model changes and the EQ900 (G90) had sold 42.950 and 23.328 vehicles, respectively. However, Genesis yielded the top spot to Mercedes-Benz for the next 3 years. It also lost ground to BMW in 2017 and 2018. In 2019, Genesis managed to beat BMW (44.191) by selling 56.801 units. But, Mercedes-Benz still retained its top stop with sales of 78.133 vehicles. This year, the G80 and GV80 improved on the notable performance. In January, Genesis’ first SUV, the GV80, was launched and the third-generation G80 was released 2 months later. By July, the GV80 had sold 20.016 units, nearly reaching this year’s goal of 24.000. The G80 sold 28.993, surpassing its annual sales last year. Hyundai plans to introduce the GV70 and G70 with minor model changes in the second half of the year. Overall car sales in the Korean market have been strong, according to separate data released by the Ministry of Trade, Industry and Commerce. A total of 164.539 vehicles have been sold; up 8.9 % year-on-year. Hyundai saw a 28.4 % increase in sales due to new and popular models such as the Avante, Grandeur, G80, Santa Fe and Palisade. Kia managed to maintain the same level, as the Sorento, K5 and Bongo 3 drove domestic demand. GM Korea saw a 3.5 % increase on-year due to brisk sales of new cars, such as its Trailblazer. On the other hand, SsangYong Motor saw a 23 % decrease on-year due to an overall fall in demand. Renault Samsung’s sales also declined 24.2 % due to reduced sales of small and medium-sized SUVs such as the XM3 and QM6. As for imported car brands, sales of German brands increased while Japanese brands were sluggish. Sales of Japanese brands, including Toyota, Lexus, Nissan and Infiniti, dropped by 39.6 % on average. German brands increased 11.7 % due to new cars such as the Audi A6, Q7 and Q8, as well as Volkswagen’s Tiguan. +++ 

+++ Iit’s hard to believe that it’s coming up for 2 years since Carlos GHOSN was arrested for alleged improprieties in his running of Nissan. Harder still to believe just how far alliance partners Nissan, Renault and Mitsubishi have fallen since he left. But is their combined nosedive the consequence of outside circumstances or the cause and effect of removing the top man from the job? Could it be that Ghosn’s biggest talent was not so much big-brained forward planning as holding the partnership together at the seams? Was he the glue that bonded this band of misfits? Never one to play down his significance, Ghosn gave the French press his version of events earlier this summer. “I find the results of Nissan and Renault pathetic”, he surmised. “The 2 companies are looking inwards. There is no longer any real mix of management between Renault and Nissan, but a distrustful distance”. When he spoke, Ghosn was reflecting on the fact that Nissan’s and Renault’s share prices had fallen 55 % and 70 % respectively from when he was locked in a cell in November 2018 through to June 2020. In contrast, General Motors had had a 12 % dip and Toyota 15 %. There was the world crisis, and there was the Nissan and Renault crisis, and they were of very different magnitudes, he reasoned. Of course, you may argue that he would say that, given his arrest, the scale of the accusations of wrongdoing and his subsequent flight to dodge what he perceived as a flawed Japanese justice system, but subsequent events have suggested he may have a point. Certainly, the teetering triumvirate’s problems show little signs of slowing. Nissan has recently warned it will lose €4.2 billion this financial year, cautioning it is experiencing its lowest sales in a decade, Renault lost a scarcely survivable €7.5 billion in the first half of this year alone and Mitsubishi is predicting a €3 billion loss and its worst sales for 15 years. The response of all 3 has been, as Ghosn highlighted, to look within. Nissan has retrenched what it can back to Japan, scaling back its global ambitions. Renault likewise, with a renewed focus on Europe, putting profitability over scale. Mitsubishi, of course, has taken the most radical step of them all, pulling the pin on Europe entirely. At present, the alliance shows all the signs of being in limbo, each side so consumed by its own issues that they are unwilling to tackle their collective ones. From the sidelines, it’s hard not to conclude that it would be better to be full on or fall out, with history suggesting the former is the best solution of all. The pity is that the best solution might be what they had all along. +++ 

+++ JAGUAR LAND ROVER (JLR) is embarking on a serious hydrogen power research project with the aim of developing fuel cell-powered versions of its larger vehicles. Should the research effort (which is known as Project Zeus) prove successful, the fuel cell technology would most likely be ready for production use around the time of the next-generation Range Rover Evoque’s arrival in the middle of the 2020s and then be used for zero-emissions versions of larger models in the future. The British firm is currently working on several battery electric vehicles (BEVs) to join the existing Jaguar I-Pace, including a new Jaguar XJ. However, the hydrogen project could give it another powertrain option as the British government’s plan to ban the sale of internal combustion-engined vehicles by 2035 or sooner approaches. Project Zeus was described by JLR product engineering chief Nick Rogers in a recent online event as “really, really important”. He added that the company will soon reveal a driveable hydrogen fuel cell concept car. “We’re looking for the right propulsion systems; ones that see minimum interference to the environment”, said Rogers. “With hydrogen, we believe there’s a key place for it in our line-up. We’re developing and investing in that, and we’re getting great support to do that”. While it’s still early days and the focus is on developing the hydrogen powertrain technology, the first concept developed as a result of Project Zeus is likely to be an Evoque-sized SUV. The technology is being seriously considered for use in JLR’s large vehicles in the future, particularly within the Land Rover range. The Range Rover, Range Rover Sport and Range Rover Velar would all be natural choices for hydrogen power, given their large size and need for a long range and flexible usage. Hydrogen power could also be a strong option in regions and countries with limited BEV charging infrastructures where rugged off-roaders are popular. While Jaguar could also use the technology for its future models, possibly including the next-generation F-Pace, it’s likely to focus on battery-electric propulsion, given its cars’ generally smaller size and greater road bias than Land Rovers. Notably, JLR’s plans are similar to those of BMW, which is planning to put an X5-based i Hydrogen Next SUV into limited production in 2022, with plans to follow it with larger hydrogen models based on the X6 and X7. The timeframe for the start of the proposed United Kingdom ban on new Internal Combution Engine car sales, and similar plans in other countries, means JLR has no choice but to start now on a new zero-emissions strategy. This is particularly key for JLR, because most of its output is larger, heavier luxury vehicles, which are challenging to reinvent as battery-electric vehicles, given their weight and longer range requirements. Rogers said: “Hydrogen is an ideal application for the bigger vehicles in our line-up, because the bigger the car, you get diminishing returns when using battery packs. The amount of energy you can store in a battery for a given amount of weight means you’re in a position where you’re making the cars that are so heavy, they’re using a lot of energy just to cart that heavy weight about”. Project Zeus was revealed earlier this year, when the government announced that it would invest €85 million in ‘seeding’ various automotive projects to reduce CO2 emissions. JLR will work with Delta Motorsport, Marelli Automotive Systems and the UK Battery Industrialisation Centre on its hydrogen project. According to the Advanced Propulsion Centre, which issued the funding, the JLR-led project “will deliver a zero-tailpipe-emissions premium fuel cell SUV concept with Jaguar Land Rover attributes, such as long range, quick refill, towing, off-road capabilities and low-temperature performance”. JLR hired Ralph Clague as its new hydrogen and fuel cells chief in March 2019. Clague had been director of fuel cell research and development at Chinese manufacturer Great Wall since 2016. JLR was trying to recruit more hydrogen engineers early this year. JLR’s entry into hydrogen research comes as there’s a huge resurgence of interest and investment in the fuel, with numerous projects to manufacture ‘green’ hydrogen being announced across Europe in the past few months. The government recently established the Hydrogen Advisory Council “to inform the development of hydrogen as a strategic decarbonised energy carrier for the UK”. Much of the world’s hydrogen production is currently achieved by extracting it from natural gas, a process known as reforming. This can’t be regarded as ‘zero-carbon’, because the hydrogen comes from fossil fuels. However, hydrogen can also be created by using renewable electricity (from wind turbines, for example) to ‘crack’ seawater into hydrogen and oxygen through a process called electrolysis. According to recent research by forecasting specialist IHS Markit, “costs for producing green hydrogen have fallen by 50 % since 2015 and could be reduced by an additional 30 % by 2025, due to the benefits of increased scale and more standardised manufacturing, among other factors”. IHS Markit also noted that investment in hydrogen cracking is set to expand massively over the next few years, saying: “Economies of scale are a primary driver for green hydrogen’s growing cost competitiveness. The average size for ‘power-to-x’ projects scheduled for 2023 is 100 MW; 10 times the capacity of the largest project in operation today”. Despite all the faith laid in the improvement in EV battery power and storage, there has been a rapid shift in thinking across European governments. “In Europe, it’s now widely agreed that electrification alone can’t deliver the level of emissions reduction that many countries aspire to”, said IHS Markit’s Catherine Robinson. The European Union (EU) has put out a very ambitious plan for the roll-out of green hydrogen. It wants hydrogen production decarbonised by 2024 and wants to hit at least 40 GW of renewably powered hydrogen production by 2030. “Analysts estimate clean hydrogen could meet 24 % of world energy demand by 2050, with annual sales in the range of €630 billion”, the EU report says. It adds: “In regions where renewable electricity is cheap, electrolysers are expected to be able to compete with fossil-based hydrogen in 2030”. With a typical hydrogen fuel cell vehicle carrying around 5kg of gas, that would suggest a production cost of around €7.50 to fill today’s Toyota Mirai. Even factoring in tax, transportation and producer profits, that makes renewably sourced hydrogen power look cost-competitive during the next decade. There are a number of other reasons why hydrogen is now receiving massive interest as a zero-carbon fuel. First, authorities have realised that CO2-free heavy goods transport, including trains and shipping, can’t be achieved with battery-electric technology. Providing a hydrogen refuelling network for commercial vehicles would, of course, enable hydrogen passenger cars to flourish too. A major sticking point for hydrogen has also been the economies of scale of production, reflected in the high cost of the few hydrogen fuel cell EVs available, such as the Mirai and Hyundai Nexo. Greater commercial vehicle use could help to reduce that cost. Second, hydrogen could transform the geopolitics of energy. A likely future stand-off between China and the West could potentially cause the supply of batteries and the necessary rare-earth minerals to be restricted, so hydrogen made renewably would provide a significant and stable supply of green energy for Europe. Crucially, the issue of hydrogen storage in vehicles is also close to being solved. Currently, hydrogen has to be stored expensively at great pressure, and that requires relatively costly filament-wound tanks that are very hard to package inside a car. A team of researchers and scientists at Northwestern University in the US have developed a new material, described as a ‘metallic organic framework’, that will allow much greater volumes of hydrogen gas to be stored in a given space and, importantly, at a much lower pressure. The material is described as working like a sponge, able to soak up the gas and then release it under pressure. This technology could lead to hydrogen tanks fitting in the same space as today’s underfloor battery packs, making the technology an ideal retrofit into JLR’s upcoming MLA multi-fuel car platform. Compact hydrogen tanks are also being developed in Germany, while French parts supplier Faurecia is working on new thermoplastic hydrogen storage tanks that should have a factory cost of €400 per kilogram of gas stored. There are also significant engineering reasons of weight and cost that might mean hydrogen fuel cell technology will win out over battery-electric powertrains, certainly for larger vehicles at least. The 3 hydrogen tanks in today’s Mirai weigh 87 kg and offer a range of 500 km from 5 kg of gas. In stark contrast, the battery-electric Tesla Model S Long Range offers a best-conditions range of 510 km from a 95 kWh battery that weighs around 540 kg. This disparity demonstrates the huge weight advantage that hydrogen fuel cell electric vehicles could have over BEVs, even with the addition of a fuel cell stack and small battery. With current EV battery production costs at around €130 per kWh, a 95kWh battery pack is likely to have a factory cost in the region of €12.000. Even Faurecia’s limited-production-run (circa 30.000 per year) thermoplastic hydrogen tanks would cost just €2.000 for a similar range. Once seen as a dead end, hydrogen fuel cell technology could actually be the winner of the race to decarbonise the automotive industry, especially with the potential geopolitical and ethical trouble ahead for EV battery supply. +++ 

+++ In JAPAN , government officials tried unsuccessfully to bring Nissan and Honda together for merger talks earlier this year. The idea, first put to the companies at the end of 2019, was rejected before it reached the boards of both sides. Nissan, Honda and the prime minister’s office declined to comment. +++ 

+++ For all but 4 of its 72 innovative and sporadically successful years, progress at LOTUS has looked fragile. Even during its greatest racing days, those who knew the company behind the headlines were aware that it was often only a step or 2 from financial disaster, as if founder Colin Chapman needed a view of the financial abyss as a form of motivation. Since 2016, life has been quite different. In that year, Lotus was acquired by the Chinese Geely group, the successful and much-praised owner of Volvo and the London Taxi Company (now LEVC). Geely founder and chairman Li Shufu promptly signalled that €1.7 billion would be invested in the Hethel company over the long term to fund an ambitious development plan to replace the current range of UK-built sports cars in the UK and to create a brand new range of sporty SUVs in Asia. Late in 2018, Geely hired the high-achieving former Land Rover and Sunseeker boss Phil Popham to lead Lotus’s charge as CEO, building on improvements to sales and manufacturing efficiency begun by his mercurial ex-PSA Group predecessor, Jean-Marc Gales. One early, pleasant task for Popham came with the unveiling in July last year of the new Lotus Evija, a €2 million all-electric hypercar designed to grab worldwide attention for a brand that, in the new CEO’s words, has “high global awareness but low familiarity”. As a means of demonstrating the potential of modern Lotus, the Evija could hardly have been more effective, especially since other aspects of Lotus’s business were starting to go well. A backlog of overstocked cars had been cleared, sales were rising, dealer numbers were being carefully increased, quality was on the up and a skeletal, half-finished factory at Hethel (a monument to previous failures) was on the road to completion. Even so, when Covid-19 arrived early this year to knock Europe’s motor industry sideways, media pundits familiar with Lotus’s fragility expected some of the earliest bad news to come from Hethel. Only this time it didn’t. For once, others seemed to be doing worse. Lotus went into a well-organised survival mode, but its secure backing meant it could keep its eye on the long-term plan. Hethel goes back to basics with its Lotus Exige, which makes for a capable track day machine, but one less refined than its direct rivals on the road. Then, a couple of weeks ago, Lotus became the first important automotive player in the UK to stage an event intended to signal a return to normal(ish) life, choosing the Warwickshire driving enthusiasts’ haunt Caffeine & Machine, just off the Fosse Way, as a venue and bringing along a selection of its latest and best Elise, Exige and Evora models. Selected hacks drove the cars and enjoyed them but, on this occasion, it seemed more important to hear the latest from Popham, notably about progress with Vision 80, the 10-year plan he drafted soon after his arrival that sets goals for where the company aims to be on its 80th birthday in 2028. “At present, we’re running 2 businesses”, Popham explains. “There’s the long-term project that will transform us into a much bigger business at the end of the decade and there’s our current business. Vision 80 at present is about product development, finding the right people and setting up infrastructure for the long term, and because that’s currently funded from shareholder investment, it hasn’t been greatly affected by the Covid crisis. Staff have been working remotely and many will continue to do so. Our sports car business today is small in automotive terms but, until the crisis, it was growing steadily, helped by what we’ve done with the Evija. We’ve been getting more to front of mind with the media and potential customers. We’ve lately added new partners in 10 to 15 areas where we hadn’t represented, and we believe they’ll be around for the long term. And now we’re back to making sports cars again”. Popham estimates that Lotus has lost 10 weeks’ sports car business (so 10 weeks’ revenue) but still reckons the firm can match last year’s sports car volume of around 1.500 against an original sales goal that was supposed to get much closer to the 2021 target of 2.000 units. More importantly than the bald numbers, Lotus will keep pushing to make all sales profitable for dealers so that they will be encouraged to invest in the people and premises needed in future, with everything leading to the all-important unveiling of what Lotus people will only call “the new car” at the end of next year, with customer deliveries in 2022. The new core Lotus model is likely to come in both coupé and drophead forms and to use a bonded chassis of extruded aluminium sections, like today’s Evora (although designed for greater rigidity and better entry and exit, with the latter correctly identified as a buyer priority). Popham is determined to attract a new breed of customers who choose their Lotus for daily use (as Porsche buyers do) while retaining Lotus’s 1.500 to 2.000 annual sales to pure enthusiasts. No names have yet been mentioned for the new model, but both Esprit and Elan (but perhaps not Europa) would seem to be good candidates. Popham says there will be versions of Lotus’s new car that can fit all of the company’s existing price ranges, depending on specification, starting at today’s €62.000 and reaching €155.000 for the best-equipped and fastest. Existing models will be phased out in the medium term but will overlap “for a while” as Lotus monitors and shapes demand for the new car. It’s not yet clear whether a four-cylinder version will be offered, but Lotus looks certain to use the Toyota-sourced, Hethel-supercharged 3.5-litre V6, presently good for up to 430 hp, from current models. Popham says Geely’s willingness to allow Lotus to use rival group engines is “surprising” but very welcome. “The new car will be our last purely ICE-powered car”, says Popham, adding fuel to so-far-unconfirmed suggestions that sports cars beyond the new model will get another new-design aluminium platform. “All of our future cars will be specifically designed and engineered for electric offerings”, he adds. “It’s the future”. Meanwhile, Popham & Co have at last found an elegant solution to a decades-old Lotus problem: how to run an engineering consultancy specialising in cutting-edge technology (and thus dealing in other people’s secrets) when you have your own car-making business on the same site. The new solution is to move Lotus Engineering to a brand new advanced technology centre on Warwick University’s Wellesbourne Campus in partnership with WMG, the former Warwick Manufacturing Group, which is already well known as an international leader in collaboration between academic research, teaching, training and industry. Popham says 130 engineers will move to a region that he describes as “a rich pool of automotive talent”, but there will be jobs for many more as the division builds its portfolio of external projects. Rapid growth is expected. “Our engineering and R&D strategy is lock-in-step with the government’s vision and broader ambitions for a low-carbon future”, says Popham. Having always been a hotbed of advanced thinking but now with the security it deserved, the future at last looks bright for Lotus Engineering, too. When we call him Lotus’s most powerful link with the past, we have to hope that Gavan Kershaw doesn’t take offence. But it’s true anyway. Kershaw, Lotus’s director of attributes and product integrity, has the responsibility of ensuring that every new Lotus drives, feels and sounds like the kind of car that Lotus lovers expect. And those expectations have a direct lineage straight back to the special qualities Colin Chapman and his henchmen built into the Elans, Elites and Esprits of the 1960s, when Lotus single-seaters were also winning grands prix. Kershaw joined Lotus directly from school in 1988 as an apprentice, arriving on the same day as another high-achieving contemporary, Matt Becker, who is now at Aston Martin. “We met in the gatehouse on the first day, and we’ve been pretty good friends ever since”, Kershaw says. Kershaw was lucky in 3 ways. He had a motorsport background, because his father raced stock cars, his driving talent shone through from an early age and he moved into the orbit of the late John Miles, ex-F1 driver and brilliant chassis engineer. Through Miles, he still feels a link going back to Colin Chapman. Miles enjoyed working with his protégé so much he sometimes accompanied him to Yarmouth or Ipswich speedways to give hints on how to make the cars go faster. Nowadays, Kershaw’s job is to drive every car and “see what needs changing” if it’s going to feel like a real Lotus. “I spend a great deal of time in the cars”, he says. “The job is always to try to make things better, but the driver has to be the centre of everything: the hands, the ears, the fingers, the seat of the pants. That’s what makes a Lotus a Lotus, and it ain’t gonna change”. +++ 

+++ The new MERCEDES-AMG A45 S is the most powerful hot hatch on sale and, despite being built on a front-biased all-wheel drive platform, it does feature a Drift mode that allows the back end to slide. As a result, one might think that it is a proper track tool, with responsive steering and barely any understeer. However, for all its clever technology, it did not manage to pass the moose test. The challenge that replicates what happens when drivers swerve to avoid an obstacle in the middle of the road and then try to get back in their lane as quickly as possible proved too much for the A45 S, which could not complete it at 77 km/h. Engaging the Sport mode did not help, as it didn’t change the outcome. The driver had to lower the entry speed to 75 km/h in order for the hot hatch to not hit the cones, a result comparable to the much bigger Audi A7 Sportback. What’s interesting is that the BMW M235i Gran Coupe, which features a similar layout to the A45 S, also failed the test. With a whopping 421 hp and 500 Nm produced by its 2.0-liter turbocharged 4-cylinder, AMG’s ultimate hot hatch can hit a maximum speed of 270 km/h and does the 0-100 km/h in 3.9 seconds. +++ 

+++ As the global auto industry’s wheels came off due to the impact of Covid-19, one Chinese company ( SAIC MOTOR ) bucked the worldwide downtrend and zoomed ahead with impressive performance. China’s largest A-share listed automaker, SAIC Motor not only continued its overseas expansion amid the pandemic but posted a 17.3 % growth in overseas sales of its own brand vehicles in the first six months this year. “Our international team did not take a single day of break even when the pandemic was most severe in overseas markets. Our communications at work stayed regular as before”, said Yu De, managing director of SAIC Motor’s international business department. The company sold 132.000 vehicles in overseas markets in the first half, accounting for 34 % of overseas sales of Chinese automakers, and keeping its leading position in China’s auto exports. Up to 60 % of SAIC Motor’s overseas sales were contributed by its own brands, whose sales surged more than 17 % to reach 79.000 units. Its MG brand was the bestseller among China’s exported cars. Fang Yinliang, global partner and vice-president for China with consultancy Roland Berger, said Chinese passenger vehicle sales will fall by about 10 % this year due to the contagion. But, they will still outperform sales in US and Europe markets. SAIC Motor’s vehicle sales turned positive in June, and its quarter-on-quarter sales doubled in the second quarter, confirming the uptrend in the company’s performance and suggesting that sustained and consistent efforts will pay off sooner or later. SAIC Motor has spent years before taking the first step toward global development. “There are lots of challenges and bumps, and it is too early to celebrate any achievement, but the efforts are worthwhile. Like all major industries, the Chinese automotive industry will build its presence in the global market sooner or later”, said Yu. He divides SAIC Motor’s evolution over the past few decades into 3 phases. The first phase, he said, started from the middle of the 1980s through joint ventures. The second phase involved creation of its own brands and products around 2000. The third phase started in 2013 and is still on. Incidentally, it was in 2013 that the SAIC brand first sought to go global. The go-global plan necessitated enhancement of its operations and management capabilities, which may now hold the company in good stead, in the context of the post-Covid phase. The rapid recovery of business in China from the corona virus onslaught has helped put Chinese companies in a relatively better position for their overseas development. But they need to make breakthroughs and upgrade their products, branding, and innovative capabilities to become truly world-class, said Fang. “SAIC Motor is one of the earliest Chinese automakers that planned overseas development, beginning with technology upgrades and strengthened research and development capability. In contrast to its Chinese peers that first established marketing and sales channels to export their vehicles, SAIC Motor built its own factories locally in overseas markets as the group had resolved to become part of the global automotive industrial chain”. SAIC Motor is also China’s first automaker to have formulated a long-term go-global strategy. To date, the Shanghai-based company has set up 3 innovation R&D bases outside of China (in the United States, Israel and the United Kingdom), 3 overseas production bases in Thailand, Indonesia and India, and 12 regional marketing service centers in Europe, South America, the Middle East, North Africa, Australia, New Zealand, and markets of member countries of the Association of Southeast Asian Nations. SAIC Motor’s products and services are available today in more than 60 countries and regions where more than 750 outlets constitute its global marketing and service network. Thailand, the UK, Indonesia, Chile, Australia and New Zealand, the Middle East and India are the top 7 overseas markets whose annual sales volume exceeds 10.000 vehicles each. SAIC Motor’s 3 overseas tech R&D centers will customize products according to various local market requirements and customer feedback, Fang said. Agreed Yu. “We have one of the most comprehensive product models among all Chinese auto manufacturers, which enables us to provide the most suitable products in accordance with the unique requirements of each market”. About 16.000 units of the locally made MG Hector have been sold in the India market. More than 12.000 orders are going to be delivered from the factory at Halol in the western Indian state of Gujarat, according to Rajeev Chaba, managing director of MG Motor India. Back home, SAIC Motor had maintained its position as the nation’s top vehicle seller overseas for 4 years in a row (2016-19). It sold some 350.000 vehicles abroad in 2019 alone; up 26 % from 2018. “SAIC Motor’s recognition in the Southeast Asian market has reached the level of some Japanese automakers, while its outstanding sales in developed auto markets including the UK and Australia showed Chinese passenger carmakers are capable of competing in the mainstream market”, said Fang. The MG model’s overseas sales in the first half surpassed 70.000 units; up 37 % year-on-year. The regions that reported the most significant sales growth include the Middle East, Southeast Asia, Australia and New Zealand, and the UK. Yu credited the stellar performance to the company’s years-long efforts in exploring global markets and its ability to follow the latest trends in the automotive sector, including the gradual shift to electric, intelligent and connected vehicles, the concept of sharing economy as embraced by ride-hailing firms that are now among automakers’ biggest clients, and internationalization of auto companies. “We are confident that our MG brand will be able to reach annual global sales of more than 1 million vehicles by 2025”, said Wang Xiaoqiu, president of SAIC Motor. +++ 

+++ SSANGYONG ‘s auditors have refused to sign off on the carmaker’s half-year report, increasing the risk that the company could be delisted if the issue isn’t resolved by the end of the year. The Korean unit of Mahindra wasn’t given an opinion due to its liquidity crisis, according to a regulatory filing. “The company’s floating liability exceeds liquid assets by 447.9 billion won ($377 million), which puts the company’s future existence in question”, Samjong KPMG, the automaker’s auditor, wrote in the regulatory filing. According to the report, the beleaguered automaker posted a 215.8 billion won operating loss and 202.4 billion won net loss in the first half. Its debt stood at 1 trillion won while its assets were valued at a mere 537.6 billion won. SsangYong’s report at the end of the first quarter was also not signed off. As the automaker was refused an opinion in its half-year report, the company was designated as “administrative issue” by the Korea Exchange. Its shares have been temporarily suspended on the main bourse and will resume trading on Aug. 19 when the market opens. Being designated as administrative issue indicates that the company has failed to secure the liquidity required for a listed company. It is also a warning to investors that the company could soon be delisted due to the liquidity issue. Of the 4 audit opinions (unqualified, qualified, adverse and disclaimer) if the company receives either of the latter 2 in the year-end audit report, it could get delisted. SsangYong is in desperate need of new investors to revive its business. Its parent company Mahindra, which currently holds a nearly 75 % stake, said earlier this month that it would lower its ownership to under 50 % and give up its status as the biggest shareholder if new investors step in. Chinese carmakers including BYD and Geely and Vietnamese carmaker Vinfast are said to be interested in SsangYong, but nothing has been officially announced. If Mahindra lowers its ownership to under 50 %, foreign banks which have provided loans to SsangYong could immediately demand repayment as their condition for the loans included Mahindra having more than a 51 % stake in the Korean auto company. According to the regulatory filing, SsangYong has short-term loans worth 306.9 billion won as of the first half of this year, nearly half of which come from foreign financial companies including JP Morgan, BNP Paribas and the Bank of America. SsangYong has been on the edge of a cliff since early this year when its Indian parent company withdrew its initial plan to inject 230 billion won into the company, but agreed to inject a one-time emergency fund of 40 billion won. The Korean carmaker as a result resorted to selling off assets such as its logistics center in Busan for 20 billion won and its after-sales service center in Seoul for 180 billion won. It also cut down wages and welfare benefits to save about 100 billion won this year. It enabled the automaker to pay back 8.7 billion won of debt to KB Kookmin Bank. The Korea Development Bank and Woori Bank extended the maturity date of their loans, worth 90 billion won and 15 billion won respectively, until the end of this year. +++ 

+++ One of the many touted advantages of EVs over vehicles with internal combustion engines is the far cheaper running and maintenance costs, but are these cost savings really that significant? When the first TESLA models hit the market, in particular early Model S examples, it was unclear just how reliable they would be in the long run. After all, they were being built by a relatively young company at the time with limited experience in the automotive space. In the years since, Tesla sales have soared and some owners have put huge amounts of miles on their vehicles. One of them is Steve Sasman. In 2014, he purchased a used Model S P85 with 56.000 km on the clock for $79,000. He drove it extensively during his 5 years of ownership before selling it in August last year with 344.515 km under its belt. He even went on a road trip with it to 48 U.S. states and Canada. How much did all of this driving cost him in maintenance? According to Tesmanian, Sasman spent just $5,415 on maintenance, with the most significant costs being $2,215 for a new infotainment screen and $790 for a new charging port. He also went through 2 sets of tires, had to replace a door handle and the 12 volt battery, as well as a few other things. The Tesla’s current owner has continued to drive the Model S frequently and the EV recently ticked over the 48.000 km mark. During the last 140.000 km, maintenance costs have totaled “about” $5.000. All up, that comes to a touch over $10,000 for 480.000 miles of driving. Which, in my books, is pretty impressive. +++ 

+++ Demand for battery-electric vehicles is set to grow rapidly in the coming years due to the need to cut emissions, driven by both government legislation and changing consumer expectations. But the move from combustion engine to electric power isn’t problem-free, given the huge amount of cobalt used in lithium ion batteries. Cobalt is a key component of rechargeable batteries used in cars and smartphones, and around 60 % of the global supply currently originates from mines in the Democratic Republic of the Congo. Despite prices of the mineral soaring as demand surges, the estimated 255.000 miners in the DRC work in poor conditions, for €1.50 a day. According to reports, more than 35.000 of those workers are under the age of 14, earning around 70 eurocent per day. There are also concerns about illegal mining, human rights abuses and corruption within the country. Late last year, 14 Congolese families filed a lawsuit in the US against firms including Apple, Google parent Alphabet and Microsoft. The families claimed that their children were killed or serious injured working in cobalt mines, that the named firms had knowledge the cobalt sourced for their products could be linked to child labour, and that they failed to regulate their supply chains properly. In separate statements, Apple, Alphabet and Microsoft all said they were committed to responsible sourcing of materials. For car firms, ensuring cobalt and any raw materials obtained from third-party suppliers is ethically sourced is problematic, which is why VOLVO is turning to new technology to do so. Last year, the firm announced it would introduce blockchain technology to ensure it could trace the cobalt used in the batteries of future Volvo and Polestar EVs, starting with the soon-to-be-launched XC40 Recharge P8. The Swedish firm has worked with battery suppliers LG Chem and CATL on the introduction of the technology and recently invested in blockchain firm Circulor to aid the introduction of the technology. “We already work with a non-profit in the DRC to help protect workers there”, said Martina Buchhauser, Volvo’s procurement boss, in an interview. “We’ve had it on our agenda to trace down where the cobalt for our cars comes from for a long time, but until now, we’ve been missing the technology to really do so”. A blockchain is effectively a digital ledger consisting of a series of records, each linked to each other and protected by cryptography. It creates records for each transmission that cannot be altered, allowing for independent verification and auditing. In the case of cobalt, Volvo’s blockchain ledger will record the origin of the material, its weight and size, the chain of ownership and information that shows everyone involved met standards and guidelines. “We can use it to go all the way down the supply chain with our tier one suppliers”, said Buchhauser. “It means we can map every step in battery production, down to the individual mine the cobalt came from”. Although ensuring cobalt is ethically sourced may be the most pressing application, Buchhauser noted that blockchain tracing can be applied across Volvo’s supply chain, making the whole process “more visible”. In particular, the system will be a key tool in Volvo’s goal of becoming a climate-neutral company by 2040, by ensuring that the firm’s supply chain network is following suit. “We can track CO2 emissions all the way down to source”, said Buchhauser. She added: “When we made sustainability key to Volvo, we started to look into our supply chain and looking at how to reduce the CO2 footprint along it. It was funny when suppliers all said: ‘Oh, you really mean it’. But our suppliers now know exactly what we’re doing and understand. Using a blockchain, we can map the entire supply chain from the beginning and clearly this is something to go for”. According to Buchhauser, that process ensures suppliers can’t switch where they source materials from (for example, from one cobalt mine to another) without Volvo’s approval. She also said the firm will only work with suppliers willing to sign up to the process. Other car firms, including Ford and Volkswagen, are also investing heavily in blockchain technology. It won’t solve all the issues, but as the growth in demand for cobalt exacerbates the human rights issues that its production can create, blockchain technology can be a crucial tool for car firms to help protect workers in the DRC and elsewhere. +++

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