Newsflash: Renault komt met 2 elektrische SUV modellen

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+++ AUDI isn’t shy in stepping into the bounds of electrification, especially in Europe. In its home country in Germany, the automaker offers plug-in hybrid variants of the Q5, Q7, A6, A7, and A8. Extensive, yes, but understandable since emission regulations are getting really strict in the old continent. However, we have yet to see Audi equipping its RS models with electric motors. Not surprising since Audi RS models are cars for enthusiasts and just putting the word electric beside an RS could already spark some debate among purists. But that doesn’t mean that Audi isn’t open to the idea of adding hybrid variants into the RS range; that’s what a recent statement from Ekkehard Kleindienst, Audi’s head of Product and Technology Communications, implies. “These are really born and bred RS models, coming with a plug-in hybrid powertrain”, he said in an interview. Kleindienst continues on by explaining the benefits of hybridization, which include increasing efficiency (of course) and giving a new driving experience to customers. For him, it’s like hitting 2 birds with 1 stone: the combustion engine aims to provide emotional appeal, while the electric powertrain aligns with the electrification strategy of the brand. Although the mention of RS hybrid models was just in passing, we can’t deny that it could be in the pipeline. Then again, at this point, we might have to wait a few more years before we could officially see one from Ingolstadt. +++ 

+++ CITROEN has a new vehicle it hopes will reach a market most major carmakers have not tapped: drivers as young as 14. The French automaker’s tiny 2-seater Ami vehicle is powered by a modest 9 hp electric motor, so under French legislation it can be driven by someone as young as 14 and no driving licence is required. The vehicle has a 45 km/h top speed, its bodywork is plastic and it has a no-frills interior. But it has features likely to appeal to tech-savvy teenagers and is on sale alongside smartphones and video games consoles in a major chain of French electronics stores. In France, to buy the most basic version will cost €6.000. Citroen said it has so far taken 1.000 orders for the vehicle from customers in France. “The first client who came was a teenager and his dad”, said Olivier Garcia, head of products for French electronics retailer Fnac Darty. He said they were looking for a safer alternative to an electric scooter or a moped, the usual modes of transport young French people use to zip around cities. “So that’s a share of our customers that is not negligible”, said Garcia. +++ 

+++ After more than a year on the skids, Maserati has taken the wraps off a new high performance sports car which parent Fiat Chrysler Automobiles (FCA) will help turn the brand into the “crown jewel” of its merger with PSA. The sleek and super-lightweight MC20 offers acceleration from 0 to 100 km/h in under 2.9 seconds and a top speed of 325 km/h. Speaking at the launch in Italy’s auto city of Modena, FCA boss Mike Manley predicted Maserati would return to profit from next year and was destined to be a “CROWN JEWEL” for the new Stellantis group to be born from the PSA merger. He said work to close the merger by the first quarter of next year was progressing well, and his role in the new group would be announced by the end of year. Maserati, which made an operating loss of €199 million last year, is expected to deliver annual sales of more than 75.000 vehicles and a profit margin of more than 15 % “towards the end” of a 5-year period, Manley said. That compares with 26.500 vehicles and a margin of minus 12.4 % in 2019. “Maserati is at the very beginning of a very exciting journey”, Manley said, adding any speculation about a potential spin-off replicating what FCA did with luxury sports car maker Ferrari was premature before targets were reached. “A few years down the line we can have that kind of speculation, not right now”, he said. The MC20 is part of a fleet of new vehicles planned between now and 2023 to bolster FCA’s presence at the top end of the autos market. Stellantis’s combined portfolio has no other global luxury brand, apart from top-of-the-line Jeep and Ram truck models that sell for luxury prices in North America. However, competition is tough from the likes of Aston Martin, Ferrari, Porsche and Tesla. The MC20 will launch with an internal combustion engine and a starting price of €258.908 in The Netherlands, with a fully-electric version expected later. Carlos Tavares, the head of PSA, who will be CEO of Stellantis, has said he sees no need to scrap any brands after the merger. “I can imagine Tavares actually being quite keen on having the likes of Maserati as part of the wider group”, IHS Markit analyst Ian Fletcher said. Manley has committed to investing €2.5 billion in new Maserati models, saying its work on new technologies can benefit the rest of the group. “We are looking to keep Maserati at the forefront of where it needs to be to benefit downstream”, he said. Maserati earlier this year started selling a hybrid version of its Ghibli and plans to launch between 2021 and 2022 a new SUV and redesigned GranTurismo and GranCabrio models, the brand’s first fully-electric cars. +++ 

+++ The EUROPEAN COMMISSION will propose that the European Union further tighten its auto emissions limits, according to a draft document, prompting a pushback from Germany’s car industry, the region’s biggest. Under the proposal, by 2030 the average carbon dioxide emissions of new cars should be 50 % below 2021 levels. The bloc’s current plan calls for a 37.5 % reduction over that period. A spokeswoman for the commission declined to comment. Germany’s auto association VDA said it would firmly reject a further tightening of the targets. The draft document, due to be published next week, sets out the commission’s broader plan for the EU to set a 2030 target of cutting its greenhouse gas emissions by at least 55 % against 1990 levels, and how it can achieve this goal. The bloc’s current 2030 target is for a 40 % cut in emissions from 1990 levels. +++ 

+++ From the moment he was named chief operating officer and heir apparent to the top spot at FORD in February, Jim Farley has touted the growth potential of its commercial vehicles. But it’s not just more picksups and vans that Farley wants to sell. As Farley prepares to takes over as chief executive on October 1, he is betting Ford can transform its commercial vehicle business to generate recurring revenue through sales of services that take advantage of the software, data and connectivity in its F-Series pickup and Transit vans. “Think of it as a second F-150”, Farley told, referring to the U.S. automaker’s lucrative full-size truck business that generates $50 billion in annual revenue. “We have the F-150 everyone loves. There’s this other business out here that’s huge. Think of the data being more powerful than the fuel economy of the vehicle”, he added. Automakers like Ford have talked for a long time about generating post-sale revenue from connected vehicles, but they have struggled to deliver. As a result, Ford has been abandoned by growth-oriented investors, despite its lucrative F-series franchise. Ford now is trying to show it can grow, and build a competitive moat around its commercial vehicle business before electric car leader Tesla, other startups and larger technology players like Amazon.com Inc enter those markets. The U.S. market alone last year accounted for more than $58 billion in sales of commercial trucks and vans, everything from Class-1 regular pickups to Class-7 heavy-duty trucks like the Ford F-750, according to ACT Research. Farley is counting on a new hire to help build data-generated revenue from Ford’s commercial vehicle business: Alex Purdy, former head of agricultural equipment maker Deere & Co’s Silicon Valley office. At Deere, Purdy led efforts to deliver artificial intelligence (AI) on the farm through smart equipment and founded John Deere Labs to help build a “sticky” relationship with customers. Deere’s aftermarket parts and services business accounted for about 15 % to 20 % of $35 billion in sales last year. In his first interview since his May hiring to lead Ford’s commercial vehicle connectivity business, Purdy said he “helped transition an industrial goods business that thought about metal bending into a service business”. Among the products developed by Deere while Purdy worked there were the ExactEmerge planter that offers improved seed spacing at higher speeds, freeing up workers for other jobs; and the See and Spray distribution system that will use smart cameras to distinguish between healthy and unhealthy crops, allowing for reduced use of herbicides when it’s introduced next year. Purdy, a 35-year-old former investment banker and consultant, grew up on a farm in Okotoks, outside Calgary, Canada, and describes himself as “passionate about smart connected vehicles, automotive, artificial intelligence”. Ford is the leading commercial vehicle brand in the United States and Europe (with shares of 40 % and almost 15 % respectively) thanks to the F-Series trucks as well as its Transit vans. “Ford is the 900-pound gorilla in the commercial business”, said Rhett Ricart, a big Ford commercial vehicle dealer in Columbus, Ohio. “They’ve always had this competitive advantage”. Earlier this year, Ricart moved into a new 116.000 square-foot commercial truck facility that dwarfs the old 18.000 square-foot building, and said he looks forward to working with Ford as they roll out additional connected services. Purdy and other Ford officials want Ford’s commercial customers to regularly pay for services, creating a revenue stream that flows throughout the vehicle’s life, beyond a one-time transaction every few years. Ford officials talk about products as such geolocation services to optimize route planning and reduce gasoline usage, predictive products that allow for faster oil changes and fleet management operations. “When you measure time as a commodity like money, there are lots of those kinds of experiences that customers are willing to pay for because they’re in the productivity business”, Farley said. The goal for Ford is to lower the total cost of ownership for its commercial customers; raise productivity, such as increased package delivery; and reduce downtime for customer vehicles, said Ted Cannis, head of Ford’s North American commercial vehicle business. “So now the total addressable market, instead of being just new-vehicle sales is the entire process (parts, service, accessories, connected services)”, he said. Hans Schep, head of Ford’s European commercial vehicle business, said the shift in focus is playing out in meetings on quality. 5 years ago, those meetings were about how to reduce Ford’s warranty costs, he said. Now, the discussions are about how to keep its customers’ vehicles on the road. Ford’s push in commercial vehicles will work hand-in-hand with the push to electrify its vehicles, including the F-150 and Transit. As part of the efforts, Ford and Volkswagen said in June they would make up to 8 million units of mid-sized pickups and commercial vans over the lifecycle of the vehicles, starting in 2022. Farley believes the automakers’ alliance will allow Ford to use their combined scale to build its European commercial vehicle business even more. +++ 

+++ GENERAL MOTORS ‘ chief executive Mary Barra has reeled off 2 significant deals in the past week in response to investor concerns the No. 1 U.S. automaker is stuck in neutral while Tesla and other electric vehicle makers are leaving legacy automakers behind. But investors want her to go further. A 10 % jump in GM’s shares helped the stock top its post-financial crisis 2010 initial public offering of $33. Some investors want Barra to split up the company so its EV assets can be valued at headier levels like Tesla and other newly public EV automakers. Last week, GM announced a deal to take an 11 % stake in and build electric pickup trucks for Nikola, as well as supply the EV startup with electric batteries and hydrogen fuel cells. Last week, GM also announced a North American alliance with Honda to share vehicle platforms, including EVs, in an agreement that could save it billions of dollars. Barra called the Nikola deal a “strong validation” of GM’s strategy. “It’s a very strong proof point of our commitment to an all-EV future and really creating a platform that others can use that’s going to give us scale and help us drive efficiency costs down”, she told reporters on a conference call. Barra over the past several years has accelerated a strategy of using profit from internal combustion models to fund development of battery and fuel-cell powered vehicles for tomorrow. But prior to the recent deals, Morgan Stanley found that of 40 investors surveyed, 72 % believe GM will eventually spin off its EV or autonomous vehicle assets and about half thought such a move could be completed by the end of 2021. During GM’s July 29 quarterly earnings call, Barra said nothing was off the table and there was no impediment to such a move. A person close to the matter who asked not to be identified said the Detroit company is exploring its options. Morgan Stanley analyst Adam Jonas, who has pushed the idea of some kind of separation at GM for years, said whether it is a spinoff or some other structure, investors want “anything different” given GM’s lackluster stock price. “If there’s an opportunity to capitalize on these assets, strategically, they should do it because the market’s certainly not giving them much value for a very improved automotive business”, said Michael Razewski, a partner with investment adviser Douglas C. Lane & Associates, which owns GM shares. GM insiders, bankers and industry officials said GM has options beyond a full spinoff of its EV operations, or doing nothing. Other choices could include a spinoff of just GM’s Ultium battery operations; hiving off the EV assets into a fully owned but separately listed stock, much like GM did in its earlier history with Hughes Electronics and Electronic Data Systems; or breaking out the EV assets within GM as it did with the Cruise self-driving business. Deutsche Bank analyst Emmanuel Rosner said a spinoff was a “no-brainer” that would unlock shareholder value and create a company worth anywhere from $20 billion to almost $200 billion. Alastair Bishop, co-portfolio manager of BlackRock’s BGF Future of Transport Fund, declined to discuss GM specifically but said the auto sector stands on the brink of a transformation similar to the one that occurred with utilities when adoption of renewable energy began. Some traditional utilities spun off their renewable energy assets and others held on to them, but there was no rule for which companies thrived, he said. “If you look over the next 5 to 10 years, something very similar will happen in the automotive space”, Bishop said. “Not every new entrant will be a winner, just as not every incumbent will be a loser. It’s going to be a bit more nuanced”. +++ 

+++ Foreign automakers are seeking delays and exemptions to INDIA ’s planned new quality rules for imported auto parts, arguing the regulations will increase costs, hurt sales and disrupt supply chains, sources with direct knowledge of the matter told. Prime minister Narendra Modi is keen to reduce imports to boost local manufacturing to make India more self-sufficient and enable it to play a bigger role in the global supply chain. That said, the move is seen mainly aimed at slashing the amount of lower-quality imports from China. “There is short term pain but there is long term gain”, Commerce minister Piyush Goyal told an auto convention, saying India has become a dumping ground for low-quality goods by not having standards similar to other countries. New rules mandating stricter quality checks have been flagged in stages for various auto parts since early this year and tighter regulations for wheel rims could be introduced as soon as October, according to a draft government notice. All automakers will have to comply, but foreign premium brands such as Daimler’s Mercedes-Benz, BMW and Audi will suffer most as they have the highest ratio of imported parts, 4 auto executives told. “It’s just an additional compliance burden and will not lead to higher local production because the volumes for luxury are too small to achieve economies of scale”, said one of the executives. The sources declined to be identified, citing sensitive negotiations with the government. Luxury carmakers account for less than 1 % of India’s annual passenger car sales in terms of volume although they contribute roughly 10 % in terms of revenue. Executives from premium German brands as well as Volkswagen, Ford and Toyota have held several rounds of talks with government officials in recent weeks, sources said. Martin Schwenk, head of Mercedes-Benz India, said in a statement that additional requirements “will make low volume business unviable”. His company is requesting a “reasonable time line for mid to long term implementation, and exemptions for low volume manufacturers in the short-term”. Volkswagen Group’s India unit also said in a statement that for premium vehicles it was not possible to localise a “majority of components or spares as the total size of market is marginal”. Toyota’s India unit is working to meet the rules but the timelines are too short, a spokesperson said. It also wants an exemption for limited, direct car imports which the company says are typically made to test new models and technologies in the market before deciding whether to manufacture them locally. Automakers are also lobbying through the Society of Indian Automobile Manufacturers (SIAM) which sources say is seeking up to a year to comply with the rules for higher volume vehicles where parts can be sourced locally. The industry body is also seeking exemptions for low volume cars such as luxury models and for parts which automakers directly import as opposed to parts imported by trading companies and by vendors in the after-sales market, the sources said. In addition to those lobbying efforts, Volkswagen, Mercedes and BMW also held a meeting with the German ambassador in New Delhi in July to apprise him of the issue, sources said. The draft government notice for wheel rims calls for new rules to go into effect from October 1 and includes a requirement that there be an audit of the plant where the rims are made. That would be difficult with current travel restrictions in place due to the Covid-19 pandemic, sources said. It was not clear when the draft notice might be finalised. To receive a shipment of imported cars or knocked-down car kits an order needs to be placed with global headquarters at least 4 months in advance, executives at 2 automakers said. “If there is no clarity, the headquarters will not take new orders and sales will suffer”, said one of the executives. From April 1, 2021 similar rules will apply to windshields and other safety glass. In June, India also made it mandatory for companies to get a licence to import certain types of tyres. “This is against every tenet of ease of doing business”, said a senior auto executive, noting the new rules come at a time when the pandemic has hit revenue and demand, and could discourage further investment in India. “Much more than the cost it is the complexity which affects the willingness of global companies to continue selling affected car models in India”, the executive said. +++ 

+++ The Air sedan from LUCID MOTORS is an impressive, high-end luxury electric car with an astounding 1.080 hp and between 745 and 815 km of range in its top Dream Edition spec, but thanks to the company’s trick powertrain engineering, that figure may just be the beginning. Lucid CEO Peter Rawlinson gave us a little taste of what might be in store down the road in a media preview the company hosted earlier this month. During Lucid’s demonstration, Rawlinson gave us a sneak peak at a new rear subframe module for the Air. The way Lucid engineered its front and rear suspension modules allows them to be swapped, and thanks to the compact nature of the company’s electric drive units, these modules can accommodate additional motors. Yeah, we could theoretically get a 3-motor Lucid Air sedan with both a staggering amount of power and the potential for advanced torque vectoring across the rear axle. As if a 2.5-second sprint to 100 km/h alone weren’t enough, right? Besides the potential for an additional motor and torque vectoring, there also seems to be room for cranking up the power. See, Lucid’s drive units (the electric motors and their associated components) are capable of delivering up to 670 hp apiece, which we touched on the new EV’s trick powertrain layout back when Lucid first detailed its capabilities. However, the high-output Dream Edition, which has 2 motors, only makes 1.080 hp, seemingly leaving 260 hp on the table. The lower trim levels are expected to have power outputs of around 400, 620 and 800 hp, all of which are expected to be dual motor, thus having even more untapped potential. It’s when you take the power potential and the ability to add an extra motor that you can see the real performance potential: This chassis could theoretically employ 3 motors pushing a whopping 2.010 hp. +++

+++ The unveiling of the MASERATI MC20 at the Modena circuit was the opening event of a new era for the Italian brand. The company is planning an ambitious rejuvenation of its lineup. Anyone afraid that the merger of FCA and PSA into Stellantis might make Maserati marginalized within the huge automaker can breathe a sigh of relief. The Modenese company gives the impression of becoming more independent while also exploiting the many synergies within FCA. Maserati is making full use of its Italian resources and knowhow. As one of the first acts in the brand’s renaissance, it has the Nettuno V6 engine for the MC20. This is just the beginning of an industrial plan that includes as many as 16 launches, including 13 entirely new models and 3 refreshes between now and 2024. The renewal of the range began this year with the restyling of Ghibli, including the introduction of a hybrid variant. The company also introduced the V8 powered Trofeo models, confirming the brand’s desire not to neglect tradition and performance. Looking into the near future, a refresh is on the way for the Quattroporte. In 2021, Maserati will put a major focus on crossovers. The Grecale will give the brand a smaller offering in the segment. There will also be a hybrid version of the Levante. Then, a massive product offensive will take place in 2022. Maserati will get its first fully electric models with the debut of the Grecale and MC20 EVs. The new GranTurismo and GranCabrio will also arrive offering both combustion engines and electric powertrains. In 2023, the top of the range will get an overhaul with the arrival of the new Quattroporte and Levante. These two will also be available with combustion and EV power. Maserati calls its electric drivetrain Folgore, which is Italian for “lightning”. It consists of a 3-motor layout. 1 motor powers the front axle. The 2 at the rear have individual management of power and torque for each wheel to achieve active torque vectoring functionality. The system runs on an 800 volt system that uses a new generation of inverters with silicon-carbide (SiC) components. This is a similar solution as the hybrid and electric tech used in Formula 1 and Formula E. High-frequency switches let the SiC inverters improve the vehicle’s performance and range. The 800 volt electric system is also capable of handling high power recharges up to 300 kW. The brand’s rejuvenation is not just about new product. The historic headquarters of Viale Ciro Menotti in Modena gets a renovated factory for building the MC20. The building also houses the Maserati Engine Lab, a technological research centre applied to powertrain development whose first work is the Nettuno engine. For the last 80 years, the plant has churned out something like 90.000 road cars and over 400 racing cars. +++ 

+++ NIKOLA said it could take legal action against Hindenburg Research, a day after the short-seller issued a scathing report accusing the electric truck maker of being a “fraud”. Hindenburg had shorted the stock and said it had gathered enough evidence to show that Nikola founder Trevor Milton made false statements about possessing proprietary technology to form partnerships with large automakers. The short-seller also accused Milton of nepotism. “To be clear, this was not a research report and it is not accurate. This was a hit job for short sale profit driven by greed”, Nikola said in a statement. “We have nothing to hide and we will refute these allegations”. The Phoenix-based company said it intended to bring the actions of the activist short-seller, along with evidence and documentation, to the attention of the U.S. Securities and Exchange Commission. “The short seller hit job is character assassination on our chairman and founder Trevor Milton. There is no substance in it”, Chief Financial Officer Kim Brady said at the Cowen Global Transportation conference. Brady added that Nikola would have a response to the short-seller report soon. Hindenburg founder Nathan Anderson said in a statement that his firm would welcome a lawsuit by Nikola. “The company answered none of the 53 questions we raised in our report after promising a full rebuttal”, he said. “We are pleased that Nikola is engaging with the SEC and we are not surprised that Trevor Milton is not commenting further on advice of counsel”. Milton tweeted that Hindenburg’s questions are “easy to comment on”, and he will release a detailed response soon. Nikola said it had hired law firm Kirkland & Ellis to evaluate its options. Hindenburg’s report garnered support from other short sellers including Muddy Waters and Citron Research. “Congrats to Hindenburg for exposing what appears to be a total fraud with Nikola”, Citron tweeted, adding that the short seller will cover half of all legal expenses for Hindenburg. Nikola’s shares were last down 16 %, after closing down 11 % on Thursday. The stock has nearly erased all the gains since Nikola announced a partnership earlier this week with General Motors, which took an 11 % stake in the company. Nikola has said that it had been “vetted by some of the world’s most credible companies and investors”. Milton shared some pictures of work in progress at a company facility in Germany. GM said after the Hindenburg report that it stood by the comments it had made in announcing the alliance and it was “fully confident” in Nikola. +++ 

+++ After more than a decade on the market, the NISSAN 370Z is finally retiring. In its place comes the 400Z. Or at least that’s what we expect Nissan to christen the new Z. Unlike today’s sports car, the upcoming 2023 Z’s digits are not expected to represent the displacement of its engine but instead its outright horsepower. Don’t worry purists, the new Z won’t abandon its history of packing 6 cylinders under its hood. Nor will it lose its third pedal option. Anticipated to pack a stable of 400 hp, the upcoming 400Z is sure to have the power needed to properly compete with the likes of the Toyota Supra and the Porsche 718 Cayman sports coupes. Look for the new Z to rely on a twin-turbocharged 3.0-liter V6 for motivation. Cribbed from the Infiniti Q50 and Q60 Red Sport 400 models, the engine will likely pair with either the Infinitis’ 7-speed automatic transmission or a tried-and-true manual gearbox (take that, Supra). Like past Zs, power will get sent exclusively to the coupe’s rear wheels. Look for the new Z’s styling to ride the coattails of its predecessors. As such, buyers can anticipate retro cues that evoke the original Datsun 240Z’s round headlights, long hood, and stubby rear end. Even the car’s badging will embrace an old-school font. Similarly, we expect the new Z’s insides to combine modern technology with design elements that give a nod toward the past. Nissan is sure to fit the car with a trio auxiliary gauges atop its dashboard. I anticipate the new Z will reach dealerships before the end of 2022. Although Nissan will initially sell the new Z exclusively as a coupe (with a hatch to access the cargo area), it may resurrect the model’s convertible body style a year or 2 down the line. +++ 

+++ The average market share of new passenger PLUG-IN ELECTRIC CARS in Europe more than doubled in the first half of 2020 to 7.8% (from less than 3% in H1 2019). The average for the European Union is 6.9% (compared to 2.4% a year ago). 2-4 top countries highly inflated the average result. In 15 countries, share exceeded 5%. The top countries (above 10%) are: Norway – 68.5%, Iceland – 43.5%, Sweden – 25.9%, Finland – 15.4%, Netherlands – 12.7%, Portugal – 11.4%. In the case of all-electric cars, the average for the market is over 4.3 % (up from 2% in 2019). Only 2 countries noted double-digit BEV share with the unprecedented position of Norway, which stands out as a global phenomenon (no change here). So far this year, 7 countries are above 5%. The top countries are: Norway – 48.1%, Iceland – 25.5%, Netherlands – 9.2%, Sweden – 7.3%, France – 6.3%, Portugal – 5.6%, Switzerland – 5.5%. The average for plug-in hybrids is 3.5%; way up compared to just 1% in 2019. 4 countries noted double-digit PHEV share. The top countries are: Norway – 20.4%, Sweden – 18.6%, Iceland – 18.0% and Finland – 12.3%. +++ 

+++ RENAULT may have to cut more costs than initially planned to get out of the red zone and its cash-flow projections are alarming, the French carmaker’s new chief executive said in an internal memo. Luca de Meo, a former Volkswagen Group executive who took over as CEO in July, wrote in the memo to unions and staff that generating cash and restoring profitability was an immediate priority. “The aim is to get back on the right track and to resolve our most pressing problems as quickly as possible: treasury and costs. This means we will perhaps need to go further than planned with our cost-cutting efforts”, he said. Renault acknowledged in May that its global ambitions had been unrealistic and announced plans to cut about 15.000 jobs, shrink production and restructure French plants in a bid to save €2 billion. De Meo did not give a figure in his memo for how much more money the company may need to save. Asked to comment on the memo, a Renault spokesman said De Meo was working on a plan to transform the company by focusing more on profitability than sales volumes. Renault, like its Japanese alliance partner Nissan, is rowing back on an aggressive expansion plan pursued by Carlos Ghosn, its former boss-turned-fugitive. The pair were among the weakest global automakers going into the Covid-19 crisis, lacking a clear plan for using their alliance to emerge from the slump and share the burden of investing in electric vehicles and other technology. De Meo said Renault was in a “red zone” as the Covid-19 pandemic had exacerbated existing problems, including a downward trajectory in earnings since 2018, its ability to generate cash, falling sales and new models that were not profitable enough. “Our cash-flow projections are alarming. More than ever, we must redouble our efforts to reach sustainable profitability, and generate cash flow”, he said. De Meo said that Renault should model itself on the turnaround path followed by French rival PSA, which has focused on trimming costs and producing more profitable vehicle ranges in recent years. “In the next 5 years, we are going to do what PSA has done in the past 5 years”, he said. De Meo also said Renault’s brand had been diluted so it would need to cut back on the number of products within different ranges by about 30 % and could also raise prices for its B or C-segment cars, by 25% to 30%. The CEO called on staff to get behind his turnaround plan. Renault union members already staged sporadic strikes when the earlier round of cost-cutting was announced in May. “We will need to take decisions that are sometimes difficult, but are necessary and positive for the company. I would describe it as a revolution”, he wrote in the memo. “This revolution, which must be pushed forward by all the men and women of the company, I’m calling it a ‘Renaulution’ ”. Renault is preparing for a wide-reaching overhaul and model blitz and it’s pinning its revival hopes on 2 new electric SUVs and a renewed focus on C-segment models. The French brand’s new partnership arrangement with Nissan, announced earlier this year, will lead to a more extensive sharing of platform, technology and production resources to boost efficiencies. It will also result in Renault taking the strategic lead in Europe under De Meo, who has begun overhauling the brand’s product roadmap despite only starting his role in July. His aim will be to turn around a firm that recorded a €7.5 billion loss in the first half of 2020. The fruits of these shared resources have already produced the CMF-EV platform, which made its debut on the newly unveiled Nissan Ariya electric large SUV. That platform will also provide the basis for further Renault and Nissan electric SUVs in the coming years. Renault will spawn two models off the CMF-EV platform initially, with the first being a high-riding production adaptation of the Morphoz concept revealed in spring this year. Although it’s tipped to be similar in length and width to the current Renault Kadjar, it will sit lower to the ground than that car, as the concept previously indicated. This is because of the greater need for aerodynamic efficiency as Renault pushes for the maximum possible EV range to ensure that the model can cover a higher percentage of customers’ car usage in Europe. “We identified there was room below the Zoe but even more expectation above the Zoe”, said Renault’s electric vehicles boss, Gilles Normand. “People are realising that EVs are safe and enjoyable and can be taken on much longer trips than early EVs”. Normand cites a target range of up to 550 km for such a model. Whether that’s achievable remains to be seen. The Ariya’s longest quoted range (for the 87kWh front-wheel-drive model) is 500 km, and a similar-sized Renault would be unlikely to improve on that significantly. Renault also claims that the CMF-EV platform (along with the efficiencies enabled through the alliance) has enabled significant cost breakthroughs. “We have achieved a 30 % reduction on the platform cost. We have reduced the battery cost by 30 % and the e-motor by 20 %”, said Renault EV development director Jean-Paul Drai. That would result in Renault’s next generation of EVs being “very close to comparable vehicles with an internal combustion engine in total cost of ownership”, according to Drai. Although not yet officially confirmed, a second EV has also been hinted at by Normand. It will “be a crossover or SUV, rather than a hatchback”, he said, and the expectation is that the model would sit in a similar market position to the Nissan Juke and Renault Captur. Such a model is again expected to borrow design themes from the Morphoz concept, albeit in a toned-down form to differentiate between it and the pricier Kadjar-sized electric SUV. The dedicated EV platform (much like that found in Volkswagen’s new ID range) is expected to increase development and manufacturing costs over rival models that use a combustion-engined car adapted to offer an electric-only version (such as the Peugeot e-2008). The trade-offs, however, are benefits for both external design and interior practicality. “A dedicated platform allows us to push the boundaries of the proportions of the vehicle: to push the wheelbase to an extreme level”, Nissan’s product planning boss, Marco Fioravanti, told. “Doing so, we reconfigure the cabin. We get a fully flat floor and do not lose space on the rear bench. We think this investment is fully recognised by our customers”. Fioravanti has also debunked suggestions that the recent changes to the Renault-Nissan-Mitsubishi alliance will prompt Nissan to pull out of Europe and Renault to take control of the market. The group detailed a ‘leader-follower’ initiative in May under which Renault will lead development of European models, with Nissan focusing on Japan, North America and China. Fioravanti said: “Leader-follower does not mean that there is one dominating company and one ‘satellite’ of the first company. Nissan is still the leader on CMF-EV. Nissan leads on autonomous driving. It simply means we can avoid redundancies in development. For example, the next generation of B-segment vehicles will be led in Europe by Renault, so the next-generation Micra or Juke will be together with the Clio and Captur. Nissan will lead on a C-segment platform. We can avoid duplicating the job so we can get overall to a maximum level of efficiency”. Fioravanti’s apparent confirmation of a new-generation Micra is significant, given that rumours about the model’s future have been rife. The current supermini (launched in 2017) shares much with the old Clio but achieved only around 20 % of its French counterpart’s sales success in 2019 (65.000 Micras versus 317.000 Clios across Europe). The Micra is currently built at Renault’s plant in Flins, northern France, whereas the Clio is built in Turkey and Slovakia. A next-generation Micra could be tenable if it could be closely aligned with the Clio in terms of production and development, which could result in it becoming, in effect, a badge-engineered model. Uncertainty remains on the Renault side of the alliance over the future of the Mégane. Formerly a huge seller and core model for the French manufacturer, its volumes are now dwindling in a segment that has been under pressure for years; by ever-tightening profit margins and the relentless march of the SUV. The Volkswagen Golf rival finds itself in a relative no-man’s land. It shares its underpinnings with the hugely successful Nissan Qashqai but also with a number of models that have either been axed or are rumoured to face the chop in the medium term. Nissan’s equivalent, the Pulsar, was withdrawn from sale in 2018 due to poor sales, and the futures of Renault’s Talisman and Scenic appear bleak. However, in Renault’s recent first-half financial results webcast, De Meo confirmed that, within just a month of becoming CEO, he and his team had “substantially reworked the product plan”, focusing on the most profitable segments. This, he said, would return Renault to “our position at the heart of the European market, on the centre of gravity that is right now in the C and C-plus segments”. He recalled how the first generation of the Mégane and Scenic “changed the company, and we have to do the same again”. Whether this means the Mégane’s future is safer, or instead means that Renault’s C-segment SUV offerings will grow even further, remains to be seen. One possibility is that the Arkana, an SUV-coupé first launched in Russia, could be brought further west to expand the range. De Meo will reveal the full details of his plan for Renault early next year. The future of Alpine is less clear than that of other brands in the wider Renault Group, as the harsh realities of building a bespoke sports car in a global pandemic and economic downturn hit home. Renault’s latest official statement on the matter claims there will be an “open reflection on the reconversion of the Dieppe plant (Alpine’s hub) at the end of production of the Alpine A110”. That won’t be until 2023 or 2024, but the use of the word ‘reconversion’ suggests the plant (and likely Alpine itself) will undergo significant changes. The brand’s future hinges on how wide-reaching Luca de Meo’s transformation and cost-cutting regime will be. The French media is reporting that de Meo has discussed the A110 needing a sequel. However, he was candid about his views on sports cars during his previous role as Seat boss, telling last year he couldn’t “afford to drop a few hundred million on something where I sell 15.000 cars at a loss just for the sake of doing a sports car”. De Meo elaborated: “SUVs are called sports utility vehicles because they represent a new concept of sportiness. SUVs with a coupé look are for us what the 2-door was: an impractical coupé you could barely fit in, but it was fast, the handling was amazing because of a low centre of gravity and so on. These things are gone”. It remains to be seen if this school of thought will be transferred with De Meo (along with former Seat design boss Alejandro Mesonero-Romanos, who has followed the CEO) to Renault. A plan was devised under previous management to turn Alpine into an all-electric performance halo brand. That would allow the wider Renault Group to showcase sporting aspects of electrification and compete with premium rivals. With the decision resting on De Meo’s shoulders, some parallels can be drawn between such an idea and the formation of Cupra as a standalone brand while he was CEO of Seat. Cupra is designed to offer “premium performance” with a strong focus on electrification, and SUVs. That thinking could be brought to Alpine to create a high-riding, sporting EV, which was already strongly hinted at during the brand’s rebirth in 2016. Whether management can translate Alpine’s core values of driver appeal and, crucially, light weight to a battery-powered crossover model remains to be seen. +++ 

+++ SKODA plans to shift production of some high-earning models to other VW group plants in other countries, the carmaker’s trade union boss said in an article. Skoda is the central European country’s biggest exporter, but its success has sometimes caused friction within Volkswagen, whose labour boss has accused it of cannibalising sales. Jaroslav Povsik, Skoda’s trade union chairman and supervisory board member, said the company planned to move production of the luxury Superb and Kodiaq to Slovakia and Germany respectively, while another SUV, Seat brand’s Ateca, was set to go to Spain. “Isn’t this campaign against Skoda enough? Do we have to strip Skoda of all that is good and excellent that we have now?”, Povsik said in the article. “We will fight on all fronts: in the press, with the government, via the public, at Volkswagen, everywhere”, he said. Last year, Skoda made 29.298 Superbs, 101.586 Kodiaqs and 98.370 Seat Atecas at its plants in the Czech Republic. Globally, the company delivered 1.24 million cars in 2019, with China and Germany as its top markets. Like other carmakers, Skoda is battling to get back from shutdowns due to the coronavirus crisis and now faces uncertainty over demand. Volkswagen Group chief executive Herbert Diess told in July that Skoda (1 of VW’s 12 brands) needed to do more to compete with South Korean and French rivals. +++ 

+++ TESLA is in discussions with Canadian miner Giga Metals about helping to develop a large mine that would give the electric carmaker access to low carbon nickel for its batteries, three sources familiar with the matter said. Alongside its goal to reduce pollution from driving, Tesla is also striving to reduce its own carbon footprint. “Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way”, CEO Elon Musk said in July. Giga Metals’s low carbon nickel plans include turning waste from its mining operations into cement type rock using carbon dioxide in the atmosphere, and using hydropower. Giga Metals’s President Martin Vydra declined to comment on any talks with Tesla, but said: “Giga is actively engaged, and has been for some time, with automakers regarding our ability to produce carbon neutral nickel. The cost of developing our project, excluding bringing hydroelectric power to the site, will be less than $1 billion”. Used to store energy in batteries, nickel is expected to see a surge in demand over coming years as governments, companies and consumers seek to cut noxious fumes emitted by fossil-fuelled vehicles. Forecasts from Benchmark Mineral Intelligence suggest nickel demand for batteries will rise to 1.4 million tonnes in 2030, or 30% of total nickel demand, from around 139,000 tonnes and 6% respectively this year, as sales of electric vehicles soar. The problem for Tesla and other automakers is that most of the world’s new nickel production will come from Indonesia, where the process would involve disposing mining waste into the ocean, a major concern for environmentalists. Giga Metals’s Turnagain mine in British Columbia has measured and indicated resources of 2.36 million tonnes of nickel and 141.000 tonnes of cobalt, according to its website. Canada produced 180.000 tonnes of nickel last year. Giga plans to produce 40.000 tonnes of nickel and 2.000 tonnes of cobalt a year for 20 years. That would be enough to power thousands of electric vehicles. “The mine is in North America, so could secure supplies for Tesla’s Nevada Gigafactory”, one source said, adding Canada’s environmental regulations were among the most stringent in the world. Tesla could provide financing, possibly in exchange for equity, nickel and cobalt. It could agree to buy the nickel and cobalt, which would attract financing from others, the source added. Any deal would be for the life of the mine, which could be for up to 40 years, the sources said. Tesla’s current capacity is 490.000 electric vehicles in the United States and 200.000 in Shanghai, according to its website, which with its expansion plans will require vast amounts of battery materials in the future from many sources. The Financial Times recently reported that Tesla had agreed to buy cobalt here from commodity trader and miner Glencore. The sources said Giga Metals had also discussed the possibility of a deal with other automakers including BMW and Mercedes. The Turnagain deposit, at around a billion years old, is relatively young and clean of impurities, which would mean high recoveries of nickel and cobalt. Giga has access to hydroelectric power in British Columbia, but producing metal creates carbon emissions as it involves using diesel-fuelled machinery, trucks, heating buildings and blasting hard rock. However, the company is working on a process that would allow the tailings, or waste rock, to absorb carbon dioxide in the atmosphere and turn it into cement type rock, the sources said. “Mining and processing the ore at Turnagain is likely to generate up to 28.000 tonnes of carbon dioxide a year”, the second source said. “The tailings could absorb up to a similar tonnage of carbon, neutralising emissions from the mine”. +++ 

+++ TOYOTA ‘s research arm said that it would create an $800 million global investment fund. The fund called Woven Capital is to invest in companies in areas including autonomous mobility and smart cities, Toyota Research Institute-Advanced Development said in a statement. Earlier this year, the Japanese automaker unveiled a plan to build a prototype “city of the future” called Woven City at the base of Japan’s Mount Fuji, powered by hydrogen fuel cells and functioning as a laboratory for autonomous cars. +++ 

+++ A leading German magazine said VOLKSWAGEN ‘s new electric car, the ID.3, had fallen short of the carmaker’s usual standards of fit and finish, and had a limited operating range, when it reviewed the car ahead of its launch. “The inner side of the hood looks like it was painted with a spray can”, the publication said, lamenting the absence of Volkswagen’s trademark build quality in a pre-production model they were testing in this week’s edition. The criticism comes as Volkswagen chief executive Herbert Diess relinquished day-to-day management responsibility for the VW brand, following criticism by the company’s labor leaders over his management style. Uneven panel gaps, an infotainment system which takes a long time to fire up, and a navigation system which fails to work were other features which the publication help up for criticism. The powertrain and ride were good, but the operating range was only 359 kilometers, the publication said. Volkswagen’s labour chief criticised the company’s electric car programme for falling behind schedule. VW in March rejected the criticism but admitted that the cars needed last minute improvements. Diess last week drove the Tesla Model Y and praised the vehicle. “This car is for us in many aspects (not in all!) a reference: user experience, updatability, driving features, performance of the top of the range models, charging network, range”, Diess said. The VW brand plans to build 1.5 million electric cars by 2025. Volkswagen Group, whose brands also include Porsche, Audi, Skoda, Bentley and Bugatti, will launch 75 electric cars by 2029 and be capable of building 26 million vehicles. +++

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