Newsflash: Volkswagen werkt aan goedkopere elektrische auto’s

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+++ AUDI is partnering with China’s internet giant Alibaba to improve its in-car applications to better meet the demands of tech-savvy Chinese customers. In a statement, the German premium carmaker said they will work together to mainly focus on navigation and digital assistant services. “This strong alliance will surely enable Audi to better serve our Chinese customers. It is further proof of our ‘In China, For China’ commitment”, says Audi China president Werner Eichhorn. China is Audi’s largest market worldwide, accounting for over 40 % of its global deliveries. Despite the pandemic, Audi sold more than 580.080 vehicles in China in the first 10 months this year; up 5.4 % year-on-year. Audi’s cooperation with Alibaba’s navigation subsidiary NavInfo started in 2006. NavInfo said this time it will provide not only its products but also R&D support for Audi’s local innovations. New functions being developed include underground parking lot navigation, lane-level navigation and navigation specifically designed for new energy vehicles. “Since we are all facing the future of intelligent driving, we will for the first time to provide our full capabilities to Audi, not only including our next-generation navigation technology but most importantly the high definition map”, said NavInfo president Liu Zhenfei. Besides navigation, Audi is including Alibaba’s in-car digital assistant service Tmall Genie in the carmaker’s self-developed connectivity platform. Tmall Genie is a service-oriented smart assistant that aims to connect different terminals and platforms in the fields of automobiles, real estate, smart homes and hotels. Ku Wei, president of Tmall Genie, said:”Users can enjoy intelligent services simply with one ID. We will also explore more intelligent lifestyle options in the vehicle scenarios with our carmaker partners. We hope to help car owners enjoy high-quality services conveniently”. +++ 

+++ A new report commissioned by a number of car firms in the United Kingdom has questioned their government’s decision to BAN new petrol and diesel vehicles from 2030, calling for a broader approach to achieve net zero carbon emissions by 2050. Commissioned by manufacturers as diverse as Honda, Aston Martin, McLaren and Bosch, ‘Decarbonising Road Transport: There is no silver bullet 2020’ contains a number of recommendations, from decarbonising the legacy fleet to greater transparency on the part of OEMs with regard to their whole vehicle CO2 output. It stresses that a one-size-fits-all approach is unlikely to work. With 40 million vehicles on the road at an average age of 8.3 years, it flags up a concern that the emissions from the UK’s huge legacy fleet will need to be addressed in order to achieve net zero by 2050. While it acknowledges that tailpipe emissions are part of the problem, the report’s authors from Decarbonising Road Transport suggest that the government should focus on the wider aspect of ‘well to wheel’ in order to deliver a zero carbon transport network. It states that recent research shows that the process of manufacturing electric cars produces 63 % more CO2 emissions than a petrol or diesel equivalent. Polestar and Volkswagen come in for praise for their recent honesty. Both firms have published figures as to how much carbon is generated in the process of building their electric cars and then how much is saved by driving them. In the case of the Polestar 2, it would need to drive for over 80.000 km before its carbon footprint dropped below that of a regular Volvo XC40. Decarbonising Road Transport is calling for all manufacturers to follow suit. “We need to do more than just electrify the fleet”, said Andy Eastlake, managing director of the Low Carbon Vehicle Partnership. “We are still selling diesel and petrol cars, the engines of which could play out until 2050, so we have to look at decarbonising fuel”. Synthetic fuels and hydrogen feature as potential solutions, especially when it comes to both the legacy fleet and also HGVs. The latter has grown by 12.6 % over the past year and, while the latest Euro 6 diesel engines emit 95 % less NOx than a Euro 5 equivalent, the weight of batteries means electric lorries aren’t a practical solution as current technology stands. The report also suggests that synthetic fuels offer a solution for the comparatively small number of sports cars, something that companies such as Porsche are already investing heavily in. The overarching theme is that industry should be allowed to take the lead with support from the government, allowing countries’ innovators to design and develop the way to a cleaner future for transport. The report calls this a “technology-neutral approach”. Because no one size fits all with regards to transport, it believes the government shouldn’t be focused on a single solution to the problem. Matt Western, chair of the All Party Parliamentary Motor Group and one of the contributors to the report, said: “The UK is home to some incredibly innovative companies and research institutions. We should foster their creativity by taking a technology-neutral approach to our emissions-reduction ambitions, allowing the industry to do what it does best: innovate”. +++ 

+++ BMW has begun on-road testing of the updated version of its X7 launched just 2 years ago, ahead of an anticipated debut in 2022. The facelifted luxury SUV will retain the current car’s striking front grille, in line with the company’s commitment to its radical but controversial new styling direction. The restyling will instead focus on the headlights, which have moved lower down the front end and adopted a more rectangular shape, similar to those worn by a recently spotted prototype for BMW’s upcoming electric luxury saloon: the i7. There is also a reshaped lower bumper that appears to do away with the current car’s prominent side air intakes. Following the initial unveiling of the X7 and the updated 7 Series with which it shares its front end design, BMW design director Adrian van Hooydonk argued that the SUV’s prominent air intakes were in proportion to the rest of the car, and in fact smaller than those of its main rivals. He said: “Yes, the X7’s grille is bigger than other BMWs’, but so is the X7 bigger than any BMW before it. That one is in proportion. Don’t worry, I don’t want the brand to turn into an oversized kidney grille brand, but I believe we understand the reasons for what we have done with the 7 Series and that the issue will solve itself thanks to evolving tastes in the markets for which the grille was introduced”. It’s not clear if BMW’s move to visually link the i7 and X7 means the latter will gain an electrified variant. Previously, BMW has stated that any hybrid version of the X7 would need to offer an electric-only range of more than 80 km to comply with market regulations in China, a key market for the model. The plug-in X5 xDrive45e is officially capable of travelling 86 km on electric power, but its powertrain would need to be uprated to provide a similar range in the heavier X7. +++ 

+++ CHINA ‘s automobile imports and exports continued its growth momentum in October by gaining 48.9 % year-on-year, according to data provided by the China Association of Automobile Manufacturers (CAAM). Last month, the import and export volume totaled $15.33 billion, gliding by 2 % from a month earlier, said the CAAM, citing customs data. In breakdown, auto imports climbed by 73.3 % year-on-year to $8.33 billion in October while exports rose by 27.5 % to $7 billion during the period. In the first 10 months of the year, auto imports and exports totaled $118.37 billion, down by 8 % year on year but narrowing from the January to September decrease. China’s auto market, hit by Covid-19, began to recover in April thanks to unleashed pent-up demand and supportive policies, with sales rising by 4.4 % year-on-year, which ended the contraction streak over the previous 21 months. +++ 

+++ The enforced need to dramatically reduce the CO2 emissions of cars sold in the European Union this year has led to expensive stumbles from manufacturers including BMW, Ford and Jaguar Land Rover as new electrified technologies faltered at the crucial moment. The task to reduce average CO2 emitted to the 95 g/km required by the EU (although this differs slightly for each brand based on the average vehicle weight) was always going to be massive. The average was 122 g/km in 2019, and it had actually risen over the preceding 3 years as buyers ditched diesel for petrol. Many companies chose to wait until this year to roll out expensive new plug-in hybrids and electric cars to comply. They may have been costly but, under the rules, any car sold emitting less than 50 g/km not only helped to cut average CO2 but also counted as 2 sales under the supercredit system, which was designed to help car makers over the line in the first year of the new rules. Ford had pinned its hopes of reaching its specific target on its new 33 g/km Kuga PHEV. But then disaster: it had to recall 21.000 examples to replace their battery packs, due to the risk of contaminated cells causing a fire. To avoid missing its target and paying substantial fines, Ford paid Volvo an undisclosed sum to pool together the two brands’ average CO2 and take advantage of Volvo’s more successful roll-out of plug-in hybrids, which had put the Swedish firm below its target. The recall and hook-up with Volvo cost Ford an estimated $600 million and wiped out all of its third-quarter European profits. “We were on track for our CO2 target this year until the Kuga PHEV situation”, CEO Jim Farley said on a call with investors earlier this month. Meanwhile, BMW suffered similar problems and had to recall 26.900 plug-in hybrids, mostly in Europe. So far it’s confident that it will still reach its target and thus avoid fines. Not so fortunate is Jaguar Land Rover, which has set aside €100 million to pay fines after the launch of its key Range Rover Evoque and Land Rover Discovery Sport plug-in hybrid models was delayed due to problems with achieving the promised electric-only range. JLR halted sales while it worked to solve the issue, which it said was exacerbated by the UK’s first lockdown. Common to the affected plug-in hybrids of all 3 manufacturers were battery packs supplied by Samsung, although the Korean firm hasn’t commented on the delays and nor have manufacturers apportioned blame. Other marques have approached the targets in different ways. Fiat Chrysler Automobiles said in a recent earnings call that it had also suffered a financial loss for the third quarter of 2020, partly due to compliance costs; both rolling out new plug-in cars and paying Tesla to pool its fleet and thus avoid fines. The Volkswagen Group, meanwhile, had been expected to hit its target this year after launching the ID.3, but it unexpectedly announced in September that it had pooled with MG to take advantage of the Chinese firm’s strong-selling ZS EV. “This could suggest the Volkswagen Group is in fact struggling and requires the help of an outside party to get it over the finish line and avoid paying fines”, said independent analyst Matthias Schmidt. Suzuki, meanwhile, had definitely been struggling after the unexpected success of its new Jimny off-roader, which suffered relatively poor fuel economy for its small size. The solution was drastic: stop sales in most markets and reintroduce it as a 2-seat van, thereby subjecting it to less stringent CO2 targets. Suzuki also leveraged its new relationship with Toyota to launch both a rebadged Corolla Touring Sports hybrid, the Swace and a rebadged RAV4 plug-in hybrid, the Across. Others aren’t so worried. Renault has done so well with sales of its Zoé that it recently announced it would accept bids from any manufacturer that wanted to pool with it to take advantage of its surplus CO2 savings. Analysis from green group Transport and Environment (T&E) suggested that Zoe sales alone reduced Renault’s average CO2 emissions by 15 % in the first half of this year; a huge amount. And reports from France suggest that now Renault is certain of hitting its target, it has delayed releasing its E-Tech hybrids to ensure that it gets the technology right and doesn’t run into the problems others have faced. The PSA Group has also reportedly done enough to reach its target. Also looking good are Nissan, Toyota plus Mazda (another pooled pair) and Hyundai plus Kia, while banking company Bernstein believes Mercedes-Benz owner Daimler is at the greatest risk of missing its target. Next year will be even tougher in terms of emissions. The supercredit system for ultra-low-CO2 cars won’t be as generous and the exemption for the 5 % of most-emitting cars will be cancelled. JLR said in its most recent financial report that it expects to pay a fine. The high-profile hiccups of some car makers in the race to finish the year free of fines are blips in what has been an otherwise remarkable achievement to cut CO2. Sales of electric cars across Europe are expected to top 1 million; double the total for last year. T&E said in a recent report: “2020 was awaited by many as the year of the electric car in Europe. And while being overshadowed by the pandemic, the electric car hasn’t disappointed”. +++ 

+++ The arrival of 4.000 sheep in the Hubei province of China earlier this month may have passed you by, but the significance of the transfer shouldn’t. Gifted by Mongolian president Battulga Khaltmaagiin, they were a symbol of wealth and health; the offer to send them was first extended in February, when he became the first foreign dignitary to visit a post COVID peak China, their final destination the dinner tables of Wuhan. That the epicentre of the outbreak should now be in a position to celebrate its emergence from the crisis may well feel extraordinary to anyone back in lockdown in Europe right now, but it’s an indicator of the success with which China has dealt with and emerged from the pandemic. While infection and mortality statistics are hotly debated, there’s little doubt that the dragon economy is now surging again, almost certainly in better shape in global terms than where it was positioned at the start of the year. “The turnaround has been stunning”, says Bill Russo, CEO of Automobility, a Shanghai-based automotive consultancy. “The moment lockdowns lifted, there was a shift in behaviour, not just to pre-pandemic levels, but something else again”. Analysts have been pouring over the reasons why, looking for clues as to how China has achieved so much so soon. Governments the world over hope that it can provide a blueprint. In the initial months after the peak of the crisis, the recovery looked problematic; heavy industrial investment lifted the economy, but it wasn’t matched by a burst of consumer spending, as effective track-and-trace processes, abundant testing and rigorously enforced quarantines subdued the public mood. Crucially, though, these actions also suppressed the spread of the virus, so before long, even major cities were reporting days, then weeks and then months of no new cases. Then the spending began. European nations of course experienced similar, with the trough of the first lockdown followed by a summer surge of buying. However, these have now almost universally been cut down by further curbs. It helps too that China has a still-emerging middle class, especially outside of the major cities. Government subsidies and incentives have also been well-judged. In recent months, industrial spending has been up around 7 % year-on-year and consumer spending 4 %. Despite its economy shrinking by 6.8 % in the first 3 months of 2020, China is now predicted to be the only major economy to record year-on-year growth; forecasts suggest a 2 % rise, while the US will shrink 4 % and some European countries almost 10 %. At the heart of this has been the automotive industry, whose turnaround makes for remarkable reading. In October, the Chinese market posted its 6th consecutive monthly year-on-year rise in new car registrations; a stunning result, given that the figures in the world’s largest car market had been stagnating for almost 2 years prior, dipping for each of the preceding 21 months. While bumps are still expected in the future as a variety of stimulus packages are withdrawn (ranging from a €1 billion fund to drive EV uptake to the easing of restrictions put in place to slow car-buying in polluted cities), it’s predicted that 2019’s total registrations figure will be comfortably eclipsed by 2022. “It looks sustainable”, said Russo. “The new car figures are impressive, but this is about a whole-market move to mobility, including commercial vehicles, used vehicles and over forms of micromobility, such as e-bikes and scooters. It’s driven by a desire to escape the petri dish of public transport during a pandemic, but this is an upwardly mobile population that will want to keep enjoying the benefits of personal transport”. So it is that China’s position within the global car industry has strengthened again, with numerous Western companies’ fortunes intrinsically knitted into its fortunes. A measure of its importance, for instance, can be seen in the Volkswagen Group’s financial records. Its 12 brands posted profits of €3.7 billion in the third quarter of 2020, the figures driven most strongly upwards by strong Chinese demand for Audi and Porsche; it lost €1.4 billion in the first half of the year. At times in this tumultuous year, the Chinese market has accounted for upwards of 40 % of the German giant’s sales volume and 30 % of its profits. The flipside to that story, and a cautionary tale of over-reliance on what have long been rapidly evolving market tastes, is the ongoing catastrophe of the PSA Group’s sales collapse in China. Back in 2014, it recorded more than 700.000 registrations through its joint-venture partnership, eclipsing sales even in its native France. Heavy investment in manufacturing plants and retail sites followed but sales didn’t, as German and Japanese rivals eroded its advantage and Chinese firms got their acts together to sell cheaper, capable alternatives. This year, PSA is expected to sell fewer than 50.000 cars in China. Few doubt that the threat of this happening to other Western brands is growing, as local manufacturers continue their rise across the budget, mainstream and premium sectors, offering capable and cost-effective transport, with a heavy emphasis on eclipsing the more upmarket Western brands by offering superior electric range and connectivity options and by being more agile and ingrained in online sales and marketing techniques. At one end of the scale, the 2-door, €4.500 Wuling Hongguang Mini EV has recently become China’s best-selling EV, eclipsing the Tesla Model 3; and at the other, Nio, a premium EV maker with global ambitions that’s listed on the New York Stock Exchange, has enjoyed a near 600 % rise in its valuation since 2018. Back in March, Hui Zhang, Nio’s vice-president for Europe, told: “We have worked hard to engage audiences in lockdown and can see the pent-up demand is there”. While a full economic recovery for China is nigh-on impossible in the context of global depression (even this famously inward-looking market is reliant on export and export trade), there are even suggestions that the country’s relatively positive performance will accelerate both the launch of more Chinese brands into global car markets (Changan, Nio, Xpeng and others are all eyeing Europe, for instance) and raise the prospect of Chinese firms investing in or acquiring struggling Western brands. Geely, already the owner of Lotus, Lynk&Co, Polestar, Volvo and the partowner of Mercedes, Proton and Smart, tried to invest in Aston Martin before its sale to Lawrence Stroll, and Mercedes’ newly increased holding there has raised speculation that its interest could be piqued again. “The market valuation of Nio is now ahead of General Motors, BMW and more”, says Russo. “The next battleground is around smart, connected, electric vehicles. The most advanced Chinese car makers believe they have an advantage there, and they’re operating in the world’s largest car market, so they can grow scale and revenue quickly at home before looking to become global brands. The ingredients for success are there”. As is so often the case with contemporary Covid-related analysis, it’s impossible to predict where it will end, but few doubt that the Mongolian sheep are likely to do anything but remain a footnote in a tale of how the pandemic re-energised the Chinese car industry and accelerated China’s global authority. +++ 

+++ Hyundai and Kia overtook BMW to rank 4th in the global ELECTRIC vehicle market this year, data showed. Research company SNE Research said Hyundai and Kia sold a combined 130.000 EVs in the global market between January and September this year. The figure is up 40.7 % from the same period last year. The strong performance was driven by a surge in sales of the Kia Niro, Hyundai Kona and Kia XCeed Plug-in Hybrid. The companies’ combined market share rose to 7.2 % from 5.7 % in the same period last year. Tesla took first place due to the popularity of its Model 3. The company sold a total of 316.000 units in the January-September period of this year, with its market share reaching 17.5 %. During the same period, the Volkswagen Group sold 233.000 units, ranking second with a 12.9 % market share. Renault, Nissan and Mitsubishi ranked third with an 8.2 % share. +++ 

+++ Daimler and GEELY , the respective parent companies of Mercedes-Benz and Volvo, announced to collaborate on developing highly efficient powertrain systems for next-generation hybrid vehicles. The 2 carmakers are expected to work together on hybrid powertrain solutions, including engineering, sourcing, industrialization and efficiency measures to enhance their global competitiveness and create economies of scale. Both sides see efficient drivetrain technologies as central to the ongoing transformation of the automotive industry and will accelerate the transition to emissions-free driving. Daimler and Geely will use global R&D networks to work together on a next-generation gasoline engine specified for hybrid applications. It is to be produced at the companies’ powertrain facilities in Europe and China, which could be utilized by Mercedes-Benz together with its partners in China as well as the wider Geely portfolio of brands including Volvo. The export of the engine from China is also an option. Markus Schäfer, chief operating officer of Mercedes-Benz said: “Our ambition is a completely carbon-neutral new passenger car fleet. The consequent electrification of our powertrain portfolio therefore is an integral part of our drivetrain strategy. To this end, we are systematically converting our portfolio so that by 2030 more than half of our passenger car sales will be comprised of plug-in hybrids or purely electric vehicles. Together with Volvo’s internal combustion engine unit and Geely, we will further extend our synergies in the field of highly efficient drivetrain systems in China and the world. At Mercedes-Benz, the newly established unit Mercedes-Benz Drive Systems will spearhead the project and create cost efficiencies”. Geely president An Conghui said: “This project reflects the need for economies of scale and targeted research and development investment in clean and highly efficient powertrains and hybrid drive systems and their applications. Together with our partner, we will jointly develop the next generation of advanced technologies in order to remain at the top of the industry in times of wide-ranging change”. +++ 

+++ GENERAL MOTORS said it is reversing course and will no longer back the Trump administration’s effort to bar California from setting its own emissions rules in an ongoing court fight. GM chief executive Mary Barra said in a letter to environmental groups it was “immediately withdrawing from the preemption litigation and inviting other automakers to join us”. The about-face came as GM sought to work with president-elect Joe Biden, who has made boosting electric vehicles (EVs) a top priority. The Detroit automaker has laid out an ambitious strategy to boost EV sales and last week said it will increase spending on EVs and autonomous vehicles by 35 % from previously disclosed plans. The announcement reflects corporate America’s move to engage quickly with the incoming Democratic administration. Barra said she believes “the ambitious electrification goals of the president-elect, California, and General Motors are aligned, to address climate change by drastically reducing automobile emissions”. The White House and Justice Department declined to comment. Environmental Protection Agency (EPA) spokesman James Hewitt said of GM’s announcement: “it’s always interesting to see the changing positions of U.S. corporations”. In October 2019, GM joined Toyota, Fiat Chrysler Automobiles and other automakers in backing the Trump administration in its bid to bar California from setting its own fuel-efficiency rules or zero-emission requirements for vehicles. California and 22 other states and environmental groups challenged the Trump administration’s determination that federal law bars California from setting stiff tailpipe emission standards and zero-emission vehicle mandates. Barra was among corporate and labor leaders who met virtually last week with Biden. Barra said she was “confident that the Biden Administration, California and the U.S. auto industry, which supports 10.3 million jobs, can collaboratively find the pathway that will deliver an all-electric future”. Biden said in a statement: “GM’s decision reinforces how shortsighted the Trump Administration’s efforts to erode American ingenuity and America’s defenses against the climate threat truly are”. The Trump administration in March finalized a rollback of fuel-efficiency standards to require 1.5 % annual increases in efficiency through 2026, well below the 5 % yearly boosts in Obama administration rules it discarded. Other automakers, such as Ford, Honda and Volkswagen, which announced a deal with California in 2019 on emissions requirements that was finalized in August, did not intervene on the administration’s side in the California fight. GM’s announcement that it was withdrawing from the lawsuit caught off-guard automakers that had joined with GM in backing Trump, as they only learned of the decision minutes before the company made it public. Toyota said that “given the changing circumstances, we are assessing the situation, but remain committed to our goal of a consistent, unitary set of fuel economy standards applicable in all 50 states”. Other automakers backing the Trump administration include Hyundai, Mazda, Nissan Kia and Subaru. GM had drawn the ire of many California officials and environmental groups. Dan Becker, director of the Safe Climate Transport Campaign, said: “GM tried to prevent California from protecting its people from tailpipe pollution. They were wrong. Now the other automakers must follow GM and withdraw support for Trump’s attack on clean cars”. In September, California Governor Gavin Newsom said the state planned to ban the sale of new gasoline-powered passenger cars and trucks starting in 2035 in a bold move to reduce greenhouse gas emissions. California is the largest U.S. auto market, accounting for about 11 % of all U.S. vehicle sales, and many states choose to adopt its green vehicle mandates. +++ 

+++ GENERAL MOTORS KOREA and its labor union reached a tentative agreement on wages, 4 months after their talks began in July. According to GM Korea, the 2 sides came up with a draft agreement during negotiations. In the tentative agreement, GM Korea promised to offer an incentive of 4 million won ($3,600) to its workers as a message of encouragement amid the Covid-19 pandemic. As the labor union asked for the management to maintain operations at the 2 automotive plants in Bupyeong, Incheon, the automaker said it would continue operating 1 of the factories in accordance with market demand. For the other plant, the company said it would invest $190 million starting next year. While the company had asked to replace the current year-to-year deal with a 2-year agreement, this was not included in the draft. The tentative agreement has to receive a majority of votes from the employees to be finalized. The vote is expected to be held next week. GM workers had staged partial strikes for the past 15 days. +++ 

+++ Carmakers from around the globe are showcasing their latest models at the GUANGZHOU auto show, demonstrating their confidence of 2021’s growth potential. A total of 38 vehicles from brands ranging from Toyota to Mercedes-Benz made their global debut on Friday, the opening day of this year’s last major event for car aficionados in China. Chinese and international brands are presenting 980 vehicles at the event’s 220.000 square meter pavilions, according to the show’s organizing committee. Changan Auto unveiled its latest SUV called Uni-K, which is expected to hit the market in 2021. It is the second model of the Chinese brand’s high-end Uni series vehicles. Changan said it is 1 of 9 models that will be launched next year. In the first 10 months of this year, Changan sold 775.000 vehicles; up 22.6 % year-on-year. Chinese-Japanese joint venture FAW-Toyota unveiled 4 models at the auto show with 3 built based on the new platform, the Toyota New Global Architecture. Of them is the mid-sized sedan Allion (photo), which made the global debut at the event. FAW-Toyota President Hu Shaohang said it is a strategic model designed with the needs of Chinese customers in mind. Hu expects the model, together with the Avalon, to open up the mid-and-high-end segment in the Chinese market for the company. FAW-Toyota sold 635.000 vehicles in the first 10 months of this year, up 6 percent year-on-year. Hu said the company will introduce 12 models by 2022 including both gasoline and electrified ones. Jaguar Land Rover made the Asian premiere of its Defender and the facelifted F-Pace. It also launched the updated Range Rover Sport and unveiled the prices of the Discovery Sport plug-in hybrid, which is the carmaker’s first China-made new energy vehicle. Richard Shore, JLR president of sales, service and marketing in China, said the company’s sales in the third quarter went up 14.6 % from the second quarter this year. He expects the sales will grow steadily as the economy continues to rebound and supplies of overseas models are restored. In the past months, the pandemic affected Jaguar Land Rover’s overseas plants, so it exported only 3.000 vehicles a month to China. The figure has grown to 5.000 since September, Shore said. “With the introduction of new models, we believe the momentum in sales will continue throughout the year and 2021”. FAW-Volkswagen is presenting around 30 Audi models at the show, of which the Q5 Sportback is making the global debut. Marco Schubert, president of the joint venture’s Audi sales division, said the model is a new benchmark tailor-made for Chinese customers. In the first 10 months this year, FAW-Volkswagen delivered 580.081 Audi vehicles; up 5.4 % year-on-year. China is the largest market for Audi. Its sales in the country accounted for 43.6 % of global deliveries in the first 3 quarters this year. Mercedes-Benz launched 10 models at the auto show and made the global launch of its Maybach S-class sedan on the eve of the event. Hubertus Troska, Daimler’s board member responsible for China, said the country is the largest market for the S-class sedan, accounting for roughly two thirds of its total sales globally. The carmaker also plans to introduce more EQ series electric vehicles starting from 2021 to meet the demands of Chinese customers for e-mobility. It launched the first model, the EQC, late last year in the country. Porsche showcased its latest electrified models including the Taycan as well as the limited 911 Targa 4S Heritage Design edition. Jens Puttfarcken, president and CEO of Porsche China, said the year 2021 marks the 20th year of the German premium brand’s entry into China, and China’s economic growth has spurred Porsche’s popularity in the country. Since 2015, China has been the world’s largest market for Porsche. A total of 71.129 vehicles were delivered in the first 10 months of this year. Maserati held its own event on the eve of the auto show, where it showcased its latest models including the hybrid Ghibli. It did not offer the sales figure this year but said the sales so far were in line with the plan. Maserati expected its China sales to be better in 2021. Mirko Bordiga, managing director of Maserati China, told that the brand is to make the global debut of its second SUV in China in 2021, as a testament to the importance of the country for Maserati. Maserati has also partnered with Tencent, which has developed an on-board entertainment system. Among other things, Tencent’s QQ music is now available in Maserati models sold in China. +++ 

+++ Chinese carmakers are launching HIGH END NEW MARQUES as part of efforts to take on international rivals in the increasingly competitive auto market. Earlier this month, Changan Auto chairman Zhu Huarong said the company will unveil a new brand in partnership with Huawei and CATL, China’s biggest electric car battery maker. The first model will soon go into mass production. Zhu said vehicles of the brand will be built on a world-leading, independent and controllable smart electric platform. He said the brand will feature a smart lifestyle and an ecosystem involving people, cars and homes. Yu Chengdong, CEO of Huawei Consumer Business Group, said they will partner to sharpen the competitive edge of made-in-China products and technologies, and offer customers better traveling experience with their smart mobility solutions. It is not the first time that Changan, partner of Mazda and Ford, has tried to break people’s stereotype of Chinese brands. At the ongoing Guangzhou auto show, Changan unveiled an SUV called Uni-K (photo), which is expected to compete in the medium and high-end segment dominated by models from brands like Volkswagen and Toyota. Changan said it will launch 5 Uni-series models in 5 years, including both sedans and SUVs. Roy Lu, director of Gasgoo Auto Research Institute, said Chinese carmakers are starting to lead in terms of electrified and smart vehicles in the past several years, and good new local marques can be attractive to the Generation Z, as they don’t take it for granted that international brands are better. “For example, models from international brands, even premium ones, do not work well in terms of voice recognition, especially when it comes to dialects. Chinese brands, in collaboration with local AI companies, have done a better job”, Lu said. Changan is not alone. In the past few years, many Chinese carmakers including both State-owned and private companies are exploring their way out of the cheaper-model segment to seize a larger share in the market. Earlier this year, Wuhan-based Dongfeng unveiled an electric car brand Voyah. Lu Fang, CEO of the brand, said Voyah aims to become a leading player in China’s high-end premium electric vehicle segment. The brand has developed a platform called the Electric, Smart and Secure Architecture. Voyah said the architecture is designed to offer its vehicles multiple power choices, software updates and improved safety. Starting in 2021, Voyah will launch at least 1 model a year and have offerings in segments including sedans, SUVs and MPVs in 5 years. BJEV, a subsidiary of Beijing-headquartered BAIC Group, launched an electric SUV, which is the first model of its premium Arcfox brand, last month. The second model, a mid-sized sedan, is expected to hit the market in 2021. It said Arcfox conducts technical validation at a lab Daimler built with BAIC, which is also its partner for producing Mercedes-Benz models. Chinese technology giant Huawei provides connectivity and 5G-related solutions in Arcfox models. Magna has established 2 joint ventures with BJEV, one specializing in electric vehicle design and development, and the other a car-manufacturing plant. The joint venture brings together BJEV’s expertise in electrification and Magna’s vehicle engineering knowhow for the Chinese market, said BJEV president Liu Yu. +++ 

+++ HYUNDAI said it has signed a memorandum of understanding (MOU) with London-based chemical company Ineos as it continues to seek out new partnerships to expand its hydrogen mobility business. The 2 companies will cooperate on creating a stable hydrogen supply chain and develop related technologies. Hyundai and Ineos will also work on utilizing hydrogen as a new source of fuel for public facilities as well as for private businesses in Europe. Ineos is a multinational chemical company which produces some 300.000 tons of hydrogen per year. The company has recently expanded its hydrogen business. Under the MOU, Hyundai will supply its modular fuel cell system to Grenadier, a SUV currently in development by Ineos Automotive, the car manufacturing arm. The 4×4 is expected to hit the market next year. Hyundai’s hydrogen ambitions are not confined to just manufacturing cars powered by the eco-friendly energy. In September, Hyundai shipped its first batch of fuel cell systems to Swiss hydrogen solution company GRZ Technologies. “It is meaningful that a traditional chemical company like Ineos is advancing into the hydrogen business by developing green energy and hydrogen cars”, said Kim Sae-hoon, head of the Korean automaker’s fuel cell center. “When Ineos’ effort is added with Hyundai’s technology, it will create synergy”. On the back of Europe’s active support of hydrogen economy initiatives, Hyundai and Ineos will together cooperate with the European Union and each member state’s government as well as private business to look for business opportunities related to hydrogen. Ineos will be in charge of producing, supplying and storing hydrogen while Hyundai Motor will supply fuel cell systems. “The agreement between Ineos and Hyundai presents both companies with new opportunities to extend a leading role in the clean hydrogen economy”, said Peter Williams, technology director at Ineos. “Evaluating new production processes, technology and applications, combined with our existing capabilities, puts us in a unique position to meet emerging demand for affordable, low-carbon energy sources and the needs of demanding 4×4 owners in the future”. +++ 

+++ In JAPAN , the government plans to double the value of subsidies aimed at promoting electric vehicles, on condition that such vehicles are charged with renewable energy, including solar power. The maximum amount of subsidies given per vehicle will be raised to ¥800,000 from the current ¥400,000, according to informed sources. The government hopes to include related expenses in its planned third supplementary budget for fiscal 2020, the sources said. The move reflects the government’s resolve to further promote electric vehicles, which do not emit carbon dioxide, after prime minister Yoshihide Suga announced Japan’s goal of reducing its greenhouse gas emissions effectively to zero by 2050. The subsidies will not only cover electric vehicle purchases by individuals but also those bought by companies. The government assumes that the expanded subsidies will cover vehicles that are charged with energy generated through solar panels set up on the roofs of homes or with renewable energy-generated electricity purchased from power companies. The planned supplementary budget will also include subsidies handed out when people buy plug-in hybrid or fuel-cell vehicles that run on renewable energy, the sources said. The upper limit of the subsidies will stand unchanged at ¥200,000 for plug-in hybrid vehicles and ¥2.25 million for fuel-cell vehicles. +++ 

+++ Unionized workers at KIA began a partial strike to demand higher wages and bonuses amid the Covid-19 pandemic, the union said. The workers in the morning shift walked away from their production lines at 11:40 a.m. in a 4-hour strike while those on the evening shift plan to put down their tools at 8:30 p.m. for another 4-hour strike. The union will stage the partial strikes until Friday, after the company and the union failed to narrow differences over wages and performance-based bonuses in 14 rounds of negotiations, union spokesman Hwang Hyo-dong said. “Union leaders will hold a meeting early next week to decide on whether to extend the strikes. We will sit down at a negotiating table with the company if there is an offer this week”. The partial strikes affect production at Kia’s 3 domestic plants in Gwangmyeong and Hwaseong in Gyeonggi, and Gwangju. The 30.000-strong union originally planned to walk out starting Tuesday, but it held the 14th round of negotiations on the same day at the company’s request. The union demanded the company increase the monthly basic pay by 120.000 won ($104) per person, offer 30 % of its annual operating profit in performance-based pay and extend the retirement age from 60 to 65. But the company proposed a plan that consisted of one and a half months of merit-based remuneration, 1.2 million won in special Covid-19 allowance, 200.000 won in gift certificates and certain company stocks in lieu of freezing wages for the year, all of which was rejected by the union. +++ 

+++ LG CHEM has been chosen as the sole supplier of rechargeable batteries for Tesla’s Model Y set to be made in China from next year. Industry insiders said LG Chem and Tesla signed the contract recently. The Y is a SUV with cylindrical batteries that LG Chem manufactures in Nanjing, China. Industry watchers believe the deal to be worth W3 trillion a year. LG Chem’s plant already supplies batteries for Tesla’s Model 3. Industry watchers had expected LG Chem to be just 1 supplier among several such as CATL and Panasonic. But Tesla apparently decided that CATL’s lithium iron phosphate batteries are not powerful enough for high-end models. According to market researcher SNE Research, LG ranks first in the global rechargeable battery market with a share of 24.6 %, followed by CATL’s 23.7 % and Panasonic’s 19.5 %. LG Chem’s market share in China, the world’s largest market for electric vehicles, is expected to rise further with the latest deal. Chinese analysts expect EV sales in China to rise 76 % in 2021 to 880.000 cars, while Model Y sales are estimated at 360.000. +++ 

+++ The next-generation MINI Countryman, due to launch in 2023, will be built in Germany at parent firm BMW’s Leipzig plant. Both the combustion-engined and electric versions of the new SUV will be built at the facility in Saxony, where the BMW 1 Series and 2 Series Active Tourer, which will share a platform with the next Countryman, are currently produced. Leipzig will become the first plant in Germany to produce both BMW and Mini vehicles. The new Countryman will be a key part of the fourth generation of Mini models since the brand came under BMW’s ownership and will follow shortly after the launch of a new 3-door hatchback. Petrol versions of that model will continue to be built in the UK, with electric versions produced in China. Mini is also developing a new compact crossover that will be built in China. Every Mini model from 2023 on will be offered with an electrified version. Hans-Peter Kemser, the boss of the Leipzig plant, said: “Over the last few years, we have worked continuously to lead our plant into a successful future. This contract to produce the successor to the Countryman gives us another major milestone to work towards”. The Leipzig factory opened in 2005 and since 2013 has also housed production of the electric BMW i3. The German firm has recently invested around €300 million in upgrades to expand capacity to around 350.000 units per year, including both ICE and electric vehicles. BMW is planning a further €100 million in investment to add an e-drive components assembly facility, which is due to open in 2021 and will enable lithium ion batteries to be made there. Production of the second-generation Countryman, which was launched in 2017, is currently contracted out to VDL Nedcar’s plant in Born, the Netherlands. +++ 

+++ Huang Zhi, a NEW ENERGY VEHICLE (NEV) owner in Southwest China’s Chongqing municipality, is fascinated by the enjoyable driving experience brought by his car. “My friend said I wouldn’t miss traditional petrol-powered cars after driving a NEV. Now I’m a true believer!” said Huang, who had just bought a new NEV produced by Nio, a Chinese electric vehicle manufacturer. In China, more and more car buyers are opting for NEVs, which reflects the rapid development of the NEV industry in the country. The production and sales of NEVs in China have occupied nearly half of the global market. In September this year, the sales volume of NEVs increased 67.7 % year on year in the country. Despite the impact of the Covid-19 epidemic, many Chinese NEV enterprises have seen their production and sales rise as they are highly favored by the capital market. In mid-November, NIO’s share price was close to $50 and the market value of its stocks exceeded $60 billion, surpassing many internationally renowned car manufacturers. “Domestic brands have the ability to compete with foreign brands, which was difficult in the past”, said Gao Guohua, chairman of State Development & Investment. “Many enterprises have developed and used their own power assemblies, and some core components and application software have gradually been domestically produced”, Gao added. Li Bin, founder of Nio, said that since its establishment, it has invested about 20 billion yuan ($3.05 billion) in research and development and about 20 billion yuan in user service system construction and brand building. Now the company sells more than 10.000 cars every quarter. A number of high-tech Internet companies in China have also joined the auto industry to promote the integrated development of NEVs and intelligent vehicles. Alibaba, the Chinese Internet giant, and Chinese automaker SAIC Motor have jointly developed the Banma intelligent automobile operating system, which can provide intelligent and connected automobile solutions for the entire automobile industry. “We have great confidence in what the future holds”, Li said. +++ 

+++ Emerging markets switching from petrol and diesel engines to electric vehicles (EVs) could save $250 billion annually and slash expected growth in global OIL demand by as much as 70 %, an industry analysis shows. As more and more nations such as China and India look to grow their electric fleet, they are in turn reducing reliance on imported oil, with EVs forecasted to soon be cheaper to make and run than their fossil-fuel-fired cousins. An analysis of EV cost trends by industry watchdog Carbon Tracker found that a switch to EVs could save China (a world leader in the technology) $80 billion each year by 2030. Increased EV production would drastically reduce the cost of oil imports, which account for 1.5 % of China’s GDP and 2.6 percent of India’s. The analysis found that the EV revolution could essentially fund itself as component costs fall over time and governments turn away from fossil fuel infrastructure such as pipelines and refineries which risk becoming stranded assets as transportation gets greener. “This is a simple choice between growing dependency on what has been expensive oil produced by a foreign cartel, or domestic electricity produced by renewable sources whose prices fall over time,” said Kingsmill Bond, Carbon Tracker energy strategy and lead report author. “Emerging market importers will bring the oil era to an end”. Transport in emerging markets accounts for more than 80 % of all expected growth in oil demand by 2003. Analyzing the International Energy Agency’s business as usual emissions scenario, the report found that half of that growth is forecast to come from China and India. It calculated that by switching to the IEA’s Sustainable Development Scenario (under which EVs account for 40 % of car sales in China and 30 % in India) oil demand growth would be slashed by 70 % this decade. The authors said a fall of 20 % in battery costs in a decade had driven “huge new markets” for EV growth. Using industry baseline figures, the analysis calculated that the cost of importing oil to run an average car over its 15-year lifetime ($10,000) is already 10 times higher than the cost of the solar equipment needed to power an equivalent EV. Last year, EVs accounted for 61 % of China’s two-wheeler sales and 59 % of bus sales. “Factor in the war on plastics hitting petrochemical demand and rising EV penetration in developed markets, it becomes ever more likely that we have seen peak oil demand in 2019”, said Bond. +++ 

+++ SSANGYONG ’s new Rexton has returned, with a bolder look and enhanced driving assistance systems. Introducing the new Rexton after launching the previous Rexton G4 model in 2017, the automaker said it sought to create a young and trendy vibe for the upper-mid-sized SUV, targeting families that enjoy leisure activities. The company expects the upgrade to raise the popularity of Rexton, which has been preferred by those seeking abundant interior space and affordable price, the automaker said. After opening preorders on October 19, SsangYong said it received orders for 3.800 units before the official launch on November 4. Adding up all purchase contracts made up to November 11, the new Rexton has already sold 5.500 units, the company said. Replacing the Rexton G4 after four years, the latest Rexton embraced bold changes both inside and outside. For the face, the automaker introduced a new large diamond-shape radiator grille, riding on the trend for bigger grilles. The newest Rexton is equipped with a 2.0-liter diesel engine that can exert up to 202 hp; up 15 hp from the previous Rexton G4. The new Rexton adopted various advanced driver assistance systems from the entry trim, Luxury, including a blind-spot warning system and autonomous emergency braking systems. The latest Rexton maintains storage space of 820 liters without folding the second-row seats; a selling point for family travelers. The car would also be suitable for car campers, as the trunk space increases to 1.977 liters (enough to accommodate 2 adults) with the rear seats folded down. According to the automaker, the new Rexton has attracted more female drivers compared to the Rexton G4. While 15 % of Rexton G4 purchasers were women, the percentage rose to 29 % for the latest Rexton when looking at preorders. +++ 

+++ TESLA ’s planned German battery factory will eventually be “the largest in the world”, CEO Elon Musk told the recent European Battery Conference in Germany, but local media reports say its construction is running into significant opposition from locals and environmental campaigners. The hold-ups come at the same time as Tesla’s market share in a booming European EV market is faltering. According to a 12-month rolling sales report by EV analyst Matthias Schmidt, Tesla Europe sales flattened off in 2020, before being overtaken from the autumn by the Volkswagen brand in the wake of the launch of the ID3. Dubbed the ‘Gigafactory’, the new Tesla battery plant (located 30 km outside Berlin) will be built alongside a new production line that will be turning out the Model Y, and likely further models to come, from next year. Musk says the production plant should initially reach an annual output of 500.000 units once fully ramped up. Although work on the production line buildings at Grünheid has progressed at great speed, Tesla is facing problems getting permission to push on with the battery production plant itself. According to local press reports, after around 300 hectares of pine trees were cleared for the site, local opposition is now centred on the likely water consumption of both the battery production facility and the paint plant. The Gigafactory foundations and the shell of the plant are in place but further advances on construction were being held up by delays to construction permits, with much of the current building work completed via ‘advance permits’.It’s suggested this is a likely consequence of an 8-day hearing, held in late September by the local licensing authority, to consider over 400 objections from a wide range of parties. Local media reports say that the objections are both about the type of paint plant Tesla has planned for the site and how clearing the forest and replacing it with paved surfaces could reduce the amount of rainfall that seeps into the area’s natural reservoirs, affecting water supply to the local population. The reports also say that the local water company could ask Tesla to build its own artificial reservoir to serve the facility. At the beginning of November, Musk flew into Berlin to visit the Grünheid site and held a meeting with Brandenburg’s minister of economics, Jörg Steinbach. He said the hour-long meeting was about the hold-ups at the Gigafactory. “Of course, we also talked about the schedule and the approval process. Elon Musk asked for an explanation of what is possible and what is not possible because it would jeopardise the legal security of the project”. Plans to start installing production equipment onto the production lines have been held up, as has the overall ‘environmental approval process’ for the battery factory, calling Musk’s ambitious timetable for building cars in Europe by summer 2021 into question. However, Tesla continues to officially state that it remains on track for factoru completion in July. In the meantime, Tesla has begun exporting Chinese-made Model 3s to Europe. These cars are fitted with LFP batteries (lithium iron phosphate), which are said to be significantly cheaper than the NMC nickel-manganese-cobalt batteries used in American Tesla cars and contributed to Chinese retail prices of the car falling by around 10 %. However, multiple sources cite homologation details for the Chinese-made Model 3 that revealed the cheaper batteries are also a significant 200 kg heavier than the NMC units. The upshot is the vehicle’s overall carrying capacity has been reduced to around 300 kg, according to claims on the financial investment site Seeking Alpha. +++ 

+++ VOLKSWAGEN brand boss Ralf Brandstätter says the firm is fully committed to producing a small electric ‘people’s car’, with a target starting price of €20.000, as part of its fast-growing ID range. The German firm is currently rolling out a number of electric-only models on the Volkswagen Group’s MEB platform, starting with the ID.3 earlier this year. The recently revealed ID.4 crossover will go on sale early next year. Volkswagen continues to invest heavily in developing its electric technology and Brandstätter said developing a new MEB-Lite version of the platform, designed for cars featuring smaller batteries with a capacity of up to 45 kWh, remains a priority. Volkswagen intends to use the platform for a supermini and compact hatchback, likely carrying the ID.1 and ID.2 tags and intended to sit alongside the combustion-engined Polo and T-Cross respectively. The firm is aiming to sell the cars for between €22.000 and €25.000 pre-subsidy. Although it has yet to set a date for their introduction, they are unlikely to appear before 2023. The 2 new models will effectively replace the e-Up as the entry level of the Volkswagen electric range, with the smaller batteries reflecting their focus on lower-mileage urban usage. Brandstätter said Volkswagen will also work with its various Chinese joint-venture partners to offer “highly affordable” electric cars in that market and the MEB-Lite platform will also spawn a range of entry-level models from sibling brands Seat and Skoda. An entry-level affordable ID model has long been a major goal for Volkswagen and is considered key to helping boost uptake of electic vehicles to hit its long-term sales goals and emission targets. Speaking recently, Brandstätter said: “We’re working on these concepts. Of course, we have to take into account that lower segments will in the future be demanding EVs, and we’re preparing concepts”. In September, sibling brand Skoda confirmed that its Citigo-e iV electric city car had been discontinued to make way for larger models and new EVs, with its Volkswagen Up and Seat Mii siblings expected to meet the same fate. There’s no word yet on a replacement for the popular but unprofitable city cars, but Brandstätter said: “We’re working on concepts for smaller segments. We will discuss it soon. Cars in smaller segments are important and very interesting for us”. Seat will next year begin production of its new Minimó electric quadricycle. It’s not yet confirmed whether that will be sold under a different name by other Volkswagen Group brands, but Volkswagen is considering urban-focused mobility solutions. “At the moment, we’re focusing on electric vehicles”, said Brandstätter. “Of course, we have studied these last-mile proposals, and we have some concepts ready, but at the moment, there’s no decision taken going to the market”. Volkswagen is keen to emphasise the flexibility of its MEB platform, which underpins the ID.3 and ID.4 and will go on to provide the basis of the ID.5 coupé-SUV, ID.6 saloon, ID.Buzz van and an as-yet-unnamed model from new development partner Ford. A small electric sports car remains on the cards. Brandstätter refused to give details but said: “MEB is a very versatile platform. Year by year, we will inform you which kind of cars are possible”. Volkswagen’s ID.R electric performance car range is set to be topped by a Tesla Roadster-rivalling coupé/roadster arriving in 2025. Volkswagen’s commitment to building 26 million EVs by 2029 remains unchanged in light of the coronavirus pandemic, with planned investment in e-mobility across the Volkswagen Group now totalling €33 billion. The launch of the ID.4 represents the start of a shift to electrification for Volkswagen’s burgeoning SUV line-up. Boss of e-mobility for the brand Thomas Ulbrich said: “In 2015, we decided to push the SUV market and start our SUV offensive. The ID.4 is the next milestone in this transformation to e-mobility as Volkswagen’s first electric SUV. “The ID.4 stands for carbon-neutral mobility and will mobilise millions, because it’s a real global car. It will quickly become a top model, not in a niche, because the market segment is becoming more and more important”. The ID 4 will be built in 5 plants worldwide and sold across 3 continents but will receive subtle market-specific tweaks to its styling, interior and technological functions to meet different market tastes. Ulbrich said: “There are definitely regional preferences, so there will be some country-specific adjustments to the ID 4 depending on the region. But Volkswagen is really experienced doing that, as the Tiguan shows. In essence, the customer wants and gets the same great technology: sufficient range, fast charging and, in a nutshell, a dynamic electric car”. +++

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