Newsflash: export SsangYong komt vrijwel tot stilstand

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+++ Toyota president Akio Toyoda has warned APPLE that getting into the car-building business is a challenging endeavor. Speaking at a recent news conference hosted by the Japan Automobile Manufacturers Association, Toyoda said that the automotive industry is happy to welcome new entrants, “but after making a vehicle, I’d like them to be prepared to deal with customers and various changes for some 40 years”. While some within the car industry think Apple could disrupt it like it has done the technology sector for so many years, Volkswagen chief executive Herbert Diess told the media in February that Apple “won’t manage to take the car industry over overnight”. In his speech, Toyoda continued by saying that new technology firms have “the potential to breathe new life into the auto industry and give customers a wider range of choices”. He added that these companies will also need to be prepared to take responsibility for the entire life cycle of their vehicles, including maintenance and scrapping. Apple is expected to release an all-electric vehicle with advanced semi-autonomous technologies, although that probably won’t happen in the near future. The technology giant had held discussions with Hyundai about collaborating on the vehicle together but talks between the companies ended earlier this year without a deal being reached. Nissan was also reported to be interested in working with Apple, but the automaker’s chief operating officer, Ashwani Gupta, shot down those rumors last month. +++ 

+++ AUDI expects to grow its annual sales in China to 1 million units in 2 years, saying it is confident in the country’s prospects as the world’s largest vehicle market. In an online event, Audi China president Werner Eichhorn said the carmaker, with its local partners FAW and SAIC Motor, will scale up its sales to 1 million units in the country in 2023, up from around 720.000 units last year. Eichhorn said China’s premium vehicle market will grow from around 3 million in 2020 to around 4 million in 2030, and 40 % of them will become new energy vehicles. He said Audi will seize the opportunity to create a new ‘golden decade’ and return to the No 1 position in China’s premium vehicle market. Audi came to China in 1988, and was the country’s best-selling premium vehicle company for around 3 decades. But it was recently overtaken by rivals Mercedes and BMW. The carmaker has stepped up efforts to catch up. In June 2020, Audi chairman Marcus Duesmann announced that he would assume direct responsibility for its business in China. “The mobility of the future is developing rapidly in China”, he said in a statement. Audi is also speeding up to introduce new models into the country. Eichhorn said Audi will launch 6 electrified models in China this year, including the locally-produced electric e-Tron. He said the number of Audi models made with FAW will reach 12 by the end of 2021. Products from its second partner, SAIC Motor, are set to be introduced in 2022. Audi has also inked a deal with FAW to build electric vehicles based on a platform co-developed by Audi and Porsche. The joint venture, which is located in Changchun, Jilin province, will see the first model to roll off the assembly line in 2024. +++ 

+++ Global automakers in the U.S. have sent a petition to the U.S. International Trade Commission seeking leniency for Korean EV battery maker SK Innovation in a legal dispute over the misappropriation of trade secrets with rival LG Energy Solution. The automakers are afraid that any punitive measures taken against SK could seriously hurt their BATTERY SUPPLY . After the ITC’s preliminary ruling in favor of LG, which could force SK to shut its factory in Georgia, Volkswagen and Ford said they could face huge problems producing electric cars, and it would cost American jobs during the coronavirus pandemic. Battery demand is increasing exponentially as carmakers start shifting to electric cars, but suppliers of the cells have been unable to keep up. This has forced automakers to go all out to secure stable supplies of batteries. GM is currently building a joint venture battery factory with LG, which will be the second for the Korean company. This could raise concerns that GM is becoming too dependent on LG. But industry insiders say stable supplies are the prime concern. There are even rumors that LG had to turn down a supply request from another automaker because it was already at full capacity. The situation is expected to continue for a considerable time. Market analysts SNE Research said battery supply currently surpasses demand, and there is a dire shortage if Chinese manufacturers are excluded. It warned that demand will surpass supply until 2025 and a supply shortage will last until 2030. One U.S. automaker with a Korean supplier recently saw one of its electric cars catch fire. Such an incident would usually prompt the automaker to press the battery producer to compensate for damage. But the automaker is apparently hesitant to sue the battery maker for fear of a disruption in supply. Another problem is that China currently controls the supply of raw materials for lithium-ion batteries like nickel, cobalt and manganese. Africa’s Congo region accounts for 70 % of the supply of cobalt, which is the most expensive of them, and Chinese companies own the rights to 4 out of 7 cobalt mines in the Congo. China also accounts for 76 % of the global supply of precursors (a combination of nickel, cobalt and manganese). Aluminum, which is not a rare metal, is also necessary to produce anodes, and China controls 57 % of global aluminum output. It also accounts for 64 % of the global output of graphite and silicon, which are used to make cathodes. What is most troubling is that China accounts for 98 % of global output of rare-earth elements that are used to make permanent magnets for electric motors. China has the world’s largest reserves (44 million tons) of rare-earth elements. Its proportion of global output last year fell to 62 % due to checks by the U.S. and Australia, but the U.S. still relies on China, sending raw materials to the Asian country for processing and importing them again. Korea imports half its rare-earth elements from China. That means they can always be used as a bargaining chip by China in its trade war with the U.S. Last year, China passed a law authorizing the limitation of rare-earth-element production and exports. +++ 

+++ BMW is planning a facelift for the 8 Series Gran Coupe. The German brand’s updated rival for the Porsche Panamera and Mercedes CLS will be on sale with a new look next year. The 8 Series Gran Coupe is set to receive a new front bumper, revised headlamps and a tweaked rear diffuser. New tail lights are also expected, which carry the same U-shaped design signature as the 4 Series. Inside, revisions should be limited to trim and upholstery finishes compared with the exterior refresh. It will stick with the same 12.3-inch digital instrument cluster and 10.25-inch infotainment system as the current car, though with an updated version of the iDrive software. The current car’s engine line-up will also remain intact. At the entry-level, there’ll be a 340 hp turbocharged 3.0-litre straight-6 in the 840i. Above that will be the 320 hp 3.0-litre diesel in the 840d and, in the range-topping M850i, there’ll be 530 hp 4.4-litre V8. All 3 engines will come with an 8-speed automatic gearbox as standard, with the most powerful unit featuring 4-wheeldrive as standard. There’s no word yet on whether the 8 Series Gran Coupe will be available with any form of hybrid drive. The addition would certainly make the car a more well-rounded rival for the Porsche Panamera, but the packaging constraints of the sloping coupe body may make it difficult to squeeze in the extra technology. Either way, BMW’s CLAR architecture (on which the 8 Series is based) is compatible with the firm’s latest plug-in hybrid technology. The 3.0-litre powertrain used in the X5 xDrive45e could be a potential candidate and would give the 8 Series an output of 394 hp and 600 Nm of torque. +++ 

+++ Chinese electric vehicle startup BYTON said it will consider different ways to raise funds for its development, with a primary focus on ensuring its first model’s mass production in 2022. The announcement came after it was reported the startup, backed by Apple assembler Foxconn, is in talks to get listed as soon as this year, through a merger with a special-purpose acquisition company. A SPAC is a shell company that raises money through an initial public offering to buy an operating entity. Byton told that it won’t comment on market speculation, but added that it will consider different ways of financing for the company’s development. “Currently our primary focus is to ensure the volume production of the first vehicle, the M-Byte”, said a Byton representative. The startup was launched in 2017 by former BMW and Infiniti executives. Its investors include FAW Group and battery maker CATL. Byton has a car plant in Nanjing, capital of Jiangsu province. Byton has been facing cash flow problems since 2019, and the Covid-19 aggravated the situation and pushed the startup to the brink of bankruptcy in 2020. Last month Byton sealed a deal with Foxconn and the Nanjing Economic and Technological Development Zone, and said its first volume model will roll out in the first quarter of 2022. As part of the agreement, Foxconn will invest $200 million in the startup and will help build a supply chain for EV production to cut car manufacturing costs. SPACs have emerged as a quick route to the stock market for companies, particularly auto technology firms, and have proven popular with investors seeking similar benefits to that of Tesla’s high stock valuation. Electric car companies Microvast, Faraday Future and EVgo Services are some of the firms in the industry that have agreed to merge with SPACs so far this year. +++ 

+++ CUPRA is gearing-up to launch a new supermini-sized electric hatchback, based on the same MEB architecture as the Volkswagen ID.1. A launch date of 2025 is targeted for the new electric supermini, along with the recently revealed Formentor e-Hybrid, Cupra Born and upcoming Tavascan, will set the tone for the Spanish brand’s electrification drive. In the short term, Cupra aims for the Formentor e-Hybrid to account for 25 % of its total sales this year. Cupra’s main concern for its EV supermini project is making it profitable, as the technology is still quite expensive and the car will sit on the very bottom rung of the company’s line-up. Cupra president Wayne Griffths said: “When you look at the B segment, this is huge in Europe, particularly in Southern Europe. And this segment is going to change from combustion cars to electric cars. And this is the most difficult one to do it on. To do it with Porsche Taycans at the top end of the market is a bit easier, but small cars and making money is more of a challenge. It’s something that we’re working on. You have to find the synergies and efficiencies everywhere otherwise you don’t get to a price level that customers can afford”. These “efficiencies” will likely involve heavy parts sharing across all of the Volkswagen Group brands, as Cupra takes advantage of economies of scale. We’ve seen this already with the ID.3 and ID.4, both of which feature the same electric motor, the same infotainment technology and similar battery packs. Given the new EV’s compact size and target market, it would make sense for Cupra to carry the ID.3’s entry-level 148 hp electric motor onto its new supermini. However, as the new car will be shorter than the ID.3, Cupra will have to fit a smaller battery pack, meaning it won’t be able to match the car’s 420 km range. Cupra is aiming to build its new electric supermini in Spain, although the firm will need the financial support of the Spanish government and the European Commission to do so. However, Griffths thinks the project could give the local economy a boost following the hardships of the Coronavirus pandemic. He said: “Obviously, Spain has been hit harder than many other places by Covid-19. Not just in health terms but in the structure of the industry: a lot of it depends on tourism, and now there’s been no tourists here for a year. That’s had a big impact on the economy and on employment. We have a big youth unemployment of 40 % and, obviously, transformation of the car industry is important not only for building cars here in Martorell (the Seat plant situated North of Barcelona), but also for the whole chain: batteries, battery assembly, electric motor assembly”. Despite Cupra’s push towards clean motoring, the firm isn’t ready to ditch combustion power yet. Cupra has just launched a 390 hp 2.5-litre 5-cylinder version of the Formentor which doesn’t feature hybrid assistance and the R&D vice president, Werner Tietz, has confirmed a new combustion-only halo model is on the way. Cupra is now entering its third year of trading, hoping its planned new models will continue the sales successes it has enjoyed thus far. Last year, Cupra sold 27.400 cars despite the effects of the Corona pandemic. That’s an 11 % improvement over the previous year, but Griffiths thinks the brand can do better. He said: “Cupra has surprised everyone in these 3 years and has even continued to grow during the pandemic. These great results make us optimistic to push harder in 2021; this year we’re looking to double the sales volume of 2020”. +++ 

+++ FERRARI has announced that a special edition version of the 812 Superfast is on the way. The brand hasn’t yet confirmed any technical details about the car, but we expect it’ll feature a host of track-oriented upgrades that will make the super GT a direct competitor for the Mercedes-AMG GT Black Series. Enrico Galliera, Ferrari’s chief marketing and commercial officer, made the announcement in a short video which was only supposed to be seen by the brand’s most valuable clients, but the clip leaked onto social media. The video was filmed in Enzo Ferrari’s office at Ferrari’s Fiorano test track, and its release was timed to coincide with his birthday on 18 February. I expect the limited edition 812 Superfast will be powered by a tuned version of Ferrari’s 6.5-litre V12 engine. In the standard 812 the engine produces 800 hp and 718 Nm, so an output of around 820 hp could be feasible, with some suspension and chassis upgrades plus grippier tyres helping to control the extra power. The finished car will also get a different nameplate: the ‘Versione Speciale’ badge is just a placeholder. Although yet to be confirmed, there’s the possibility that Ferrari could revive its ‘GTO’ badge, which was last seen on the 599 GTO back in 2012. Like the 812 Superfast, the 599 was also a V12-engined grand tourer sports car. Ferrari hasn’t released a fixed launch date for the 812 Superfast Versione Speciale, but a spokesman for the brand said it could be within the next 3 months. The car is likely to be the swansong for Ferrari’s front-engined naturally aspirated V12 models. +++ 

+++ FISKER and Foxconn have signed a memorandum of understanding that is set to pave the way for a “breakthrough electric vehicle”. Codenamed Project PEAR, for Personal Electric Automotive Revolution, the mysterious model will be a “new segment vehicle” that is jointly developed by both companies. Foxconn will be responsible for building the vehicle and production is slated to begin in the 4th quarter of 2023. The model will be sold in major markets (including China, North America, Europe and India) and Foxconn is slated to build more than 250,000 units annually. While little is known about Project PEAR at this point, Henrik Fisker said the partnership will spawn a “vehicle that crosses social borders, while offering a combination of advanced technology, desirable design, innovation and value for money, whilst delivering on our commitment to create the world’s most sustainable vehicles”. That isn’t much to go on, but the companies released a sketch which “hints at the direction we are taking”. Unfortunately, there isn’t much to see other than a rakish windscreen, a gently sloping roof and a concave rear end. Fisker also cautioned, “It might be too futuristic for some!” The model will arrive approximately 1 year after the Fisker Ocean and the company reiterated plans to show a production-intent prototype later this year. Fisker also noted interest in the electric crossover is building at an “encouraging pace” as more than 12.000 paid reservations have been made globally. Fisker has abandoned plans to develop an advanced solid-state battery to use in its future production vehicles. The car manufacturer has been working on solid-state batteries for a number of years and in 2018, stated that its (since-abandoned) eMotion sedan would soon hit the market with a solid-state battery pack. Evidently, perfecting the technology has proven to be too difficult. “It’s the kind of technology where, when you feel like you’re 90 % there, you’re almost there, until you realize the last 10 percent is much more difficult than the first 90”, Henrik Fisker recently told. “So we have completely dropped solid-state batteries at this point in time because we just don’t see it materializing. So, as we got toward the end of this, or let’s put it, as we got close to understanding fully this technology, we realized that it was much more difficult than we had predicted and expected in the beginning as we were very excited about some of the early things we were doing”. According to Henrik Fisker, the company decided in late 2019 or early 2020 that solid-state batteries “are still very, very far out”, suggesting that they could be at least 7 years away from reaching high-volume production. Since scrapping the eMotion and its plan for solid-state batteries, Fisker has pivoted its focus towards the $37,500 Ocean that will use a lithium-ion battery pack. The company is also in the early stages of developing a new affordable model that it believes could revolutionize the EV industry. Production of the Fisker Ocean isn’t scheduled to start until the 4th quarter of 2022 and already, Henrik Fisker is planning the automaker’s next model. The chief executive believes the next Fisker vehicle will be a global game-changer. It will come to life thanks to a recently-announced partnership with Foxconn that will see the Taiwanese company build the vehicle from the 4th quarter of 2023. Upwards of 250.000 units could be produced annually. Speaking about the vehicle, Fisker recently told that the new model will cost “much less” than the Ocean. He added that despite its affordability, it will still be premium and have a design unlike any other car on sale. “I can tell you it will be a body style that is not quite a one-box”, he said. “It will have such unique proportions that it will not fit in a segment. It won’t be a sedan, and it won’t be a pickup truck because it has to be a vehicle that will be driven by a lot of people. It will be somewhat smaller than the Ocean. When you see the vehicle, you will immediately realize there is nothing like it. And I think some people might find it a little too futuristic and a little too different in the beginning, But I think that is necessary because we want to create a vehicle that goes across social borders. So we are not trying to make another traditional, slightly better-looking hatchback or something like that”. The company released early sketches of the vehicle in late February and while they don’t really provide us with much of an insight into its design, they do suggest it will indeed have a unique shape. +++ 

+++ HONDA boss Takahiro Hachigo is going to step down and will be replaced by Toshihiro Mibe, the carmaker’s head of R&D, on April 1. Hachigo, who became Honda’s CEO in 2015, will remain on the carmaker’s board until June when he will retire from the company. Mibe has been the carmaker’s head of R&D since 2019 after joining Honda in 1987. Mibe has been primarily focused on R&D, especially on Honda’s powertrain development, and since 2020 has been concurrently serving as the company’s Senior Managing Director as well. Hachigo has worked on structural reforms that helped Honda “solidify existing businesses” and “prepare for future growth”, according to the carmaker’s statement. Thanks to the outgoing CEO Honda has increased its efficiency and strengthened its operating structure. Hachigo has also expanded its collaboration with General Motors for the joint development of EVs and autonomous driving. As part of Honda’s 2030 Vision strategy, the carmaker wants new-energy vehicles -EVs, FCVs, and plug-in hybrids- to account for two-thirds of its global sales by 2030. Honda has already committed to ditch pure petrol and diesel models in the European market by 2023,  focusing instead on pure electric and hybrid powertrains and wants to become the first carmaker to mass-produce Level 3 autonomous vehicles, like the updated Legend. +++ 

+++ HYUNDAI has so far avoided a chip shortage that has plagued global automakers, largely maintaining its stockpile of chips last year and even accelerating purchases towards the end, 3 people with knowledge of the matter said. The shortage has forced production cuts worldwide, including at Volkswagen and General Motors, prompting Germany and the United States to ramp up efforts to resolve the shortage. Other than Toyota, which said this month it had enough chip inventory to last it about 4 months, Hyundai and its sister firm Kia are the only global automakers to have maintained a stockpile of low-tech chips that helped them keep up production. If it doesn’t ease soon, though, the shortage could hit Hyundai too, as tight capacity on factory floors starts pressuring production of even high-tech auto chips, said 2 of the people, who are familiar with the company’s purchases. The South Korean automaker kept buying chips even as rivals cut orders to reflect diminished demand because of the pandemic. Analysts said past events that roiled Hyundai’s supply chain and forced it to halt production have shaped this more conservative take on inventory, a departure from automakers’ typical just-in-time approach. “Like other automakers, Hyundai also planned to cut production at the beginning of the year because of Covid-19”, said 1 of the people with direct knowledge of Hyundai’s purchases. “But procurement read the trend of the semiconductor industry cutting auto chips production and said, ‘if we don’t buy them as well, we’ll be in trouble later on’ “, said the person, referring to a rush of buying by gadget makers that sucked up most chipmaking capacity. Chipmakers who supply auto companies outsource most of their production to contract manufacturers like Taiwan’s TSMC, which analysts say often prioritize orders from electronics clients who account for nearly all their revenue. Hyundai still bought fewer chips in 2020 than it did in 2019, said one of the sources with direct knowledge of auto chip production. But it sharply increased buying in the quarter that ended in December, the person said. The people declined to be identified because they are not authorized to speak to media. The fact that Hyundai’s domestic market was relatively solid through the pandemic most likely influenced the company’s plans, analysts said, as did its experiences with China and Japan. Hyundai took lessons from a diplomatic spat with Japan in 2019 that affected supplies of chemicals at South Korean chipmakers, and in early 2020, when the coronavirus was spreading in China, production was halted in Hyundai and Kia’s plants because of shortages of a part from China. A spokeswoman told Hyundai was collaborating with its suppliers to maintain stable production. Since Hyundai kept buying from chipmakers and global auto parts suppliers such as Bosch and Continental before the shortage worsened, they also managed to keep costs down. “This has allowed Hyundai to first, secure auto chips, and second, buy them when they were cheaper”, said Kim Jin-woo, analyst at Korea Investment & Securities. Hyundai also has more local suppliers than rivals. These suppliers (including Telechips, which contracts fabrication out to Samsung Electronics) are likely to prioritize Hyundai, from whom they get much of their revenue, analysts said. 1 person with direct knowledge of Hyundai’s purchasing decisions said the company has diversified suppliers for at least 1 chip since late last year. In a statement, Hyundai said it plans to halt operations at one South Korean factory for 5 days in March to adjust inventories of some models. A union official told the company was trying to save chips by adjusting production of its weaker-selling Sonata model. This car sold 67.440 units in South Korea last year versus 145.463 units of Hyundai’s most popular sedan Grandeur. According to an internal document, Hyundai expects the shortage to ease in the third quarter, and Kia said last month that since October it had been reviewing its supply chain to prevent production disruption. “We would not say we are prepared for the next 3 to 6 months, but we could tell you that we are not seeing any immediate production disruption”, Kia said on an earnings call last month. Still, there is rising concern at Hyundai, 2 of the 3 people said. The company is checking inventory more frequently and trying to lock down supply contracts earlier, one of them said. The union official said Hyundai had told the union this week that Hyundai “had secured a lot of chips” but that the situation was becoming “a bit difficult”. “Clients are trying to pull all they can, while suppliers are being strategic about which order they meet”, said the source with direct knowledge of auto chip production. “It’s going to get worse before it gets better”. +++

+++ JAGUAR LAND ROVER may find China even more important as the premium British automaker transitions toward electrification, according to experts. Based on a new dedicated platform, Jaguar will be a pure electric brand in 2025 as part of the company’s plans to become carbon neutral by 2039, as its CEO Thierry Bolloré outlined in a strategy. The other brand of the carmaker, Land Rover, will launch 6 pure electric models over the next 5 years, with the first to roll out in 2024. The company will build 2 new platforms for Land Rover. Yale Zhang, managing director of Shanghai-based consultancy Automotive Foresight, said that alongside Europe, China will be a crucial market for Jaguar Land Rover during its transition toward electrification. “Electrification is an inevitable trend, and it may present new opportunities for niche brands like Jaguar to catch up with more popular premium ones in China”, Zhang said. China is the world’s largest market for electric vehicles and plug-in hybrids. Last year, around 1.37 million units were sold in the country, up almost 11 % year-on-year despite the Covid-19 pandemic. The figure is expected to reach 1.8 million this year, according to the China Association of Automobile Manufacturers. Zhang said new electric brands should carefully consider their competitive edge, as the premium segment of China’s burgeoning NEV market is so far dominated by Tesla and local Chinese startups like Nio. He estimated that the status quo may continue for 2 to 3 years, as established carmakers including BMW and Mercedes-Benz have failed so far to come up with competitive alternatives. Bolloré did not elaborate on how Jaguar will take on rivals in the market but said electrification will boost its performance in China, which has been a major source of turnover and profits for the carmaker. Last year, Jaguar Land Rover sold nearly 430.000 vehicles worldwide and sales in China accounted for 23 % of the total. “In China we have great performances and even greater potential is left untapped”, Bolloré said. He admitted that Jaguar is less known in the country compared with Land Rover, whose products “the Chinese customers appreciate very much”. But Bollore said the company has specific plans for Jaguar’s development in China as it prepares for the renaissance of the brand globally. Jaguar Land Rover has been producing vehicles in China since 2014. Its Changshu plant in Jiangsu province has an annual production capacity of 200.000 units. The company has “a clear ambition and determination to make better use of it”, he said. The executive did not offer details on how much investment may be needed at the plant for the new strategy and when it will start producing electric models. Globally, Jaguar Land Rover plans to invest around €2.9 billion each year in electrification technologies, connected services and data-centric technologies. Carmakers worldwide are pursuing zero-emission strategies to meet carbon dioxide emissions targets. In November, Bentley said its model range will be fully electric by 2030 and last month General Motors said it aims to have an all zero-emissions lineup by 2035. +++ 

+++ LUCID MOTORS chief executive Officer Peter Rawlinson says that the luxury electric car maker plans to launch a rival to Tesla’s Model 3 in 2024 or 2025. The company led by the former Tesla engineer is following the same strategy as Tesla, starting with a luxury car to create a halo around the brand and then expand into the mass market. This week it announced plans to go public by merging with a blank check company, a move that indicated a market capitalization of $56 billion, before regular production of Lucid Motors’ first model has begun. Scaling up production of a mass automobile is a major financial challenge, Rawlinson said. “I can’t wait to do that”, he told, referring to the rival to Tesla’s Model 3, it’s least expensive sedan. But first Rawlinson said he would for now focus on the luxury, bigger car, which paradoxically takes fewer resources. “To make a smaller car requires more capital, because you need a bigger factory and more automation”, he said. Experts say it may be too late for Lucid to launch the affordable model as legacy makers like Volkswagen, Hyundai Motor and Ford are already introducing affordable models to challenge Tesla. “There is a question mark over whether there will be a market left for Lucid after 4 to 5 years”, Mel Yu, an automotive industry analyst, said. Lucid Motors’ first electric car, the luxury Air, won’t go in production now until late 2021, later than the spring 2021 launch initially planned. Rawlinson said that the carmaker expects production of a less expensive, sub-$70,000 version of the luxury sedan in 2022, followed by a SUV code-named Project Gravity in 2023. He said he is interested in developing pickups and commercial vehicles, but they are several years away and might be built with partners. “The world needs $25,000 cars urgently. Lucid can’t do it for another 8 years realistically”, he said, adding that even Tesla has not launched such a model yet. He also said 6 well-known automakers have reached out to him over the last month and expressed interest in Lucid Motors’ technology. Cooperating with another company could lead to making a $25,000 car in the next 3 to 4 years, he added. He also said it is too early for the company to make its own battery cells for now, adding that it has contracts with suppliers LG Chem and Samsung SDI. +++ 

+++ China’s leading electric car startup NIO said its sales in the first quarter this year would reach 20.000, which would be more than 5 times the figure in the same period last year. Nio gave the estimate when it released its financial statement for the year 2020, in which it delivered 43.728 vehicles. In the first 2 months of the year, its combined sales totaled over 12.000 vehicles. “Supported by competitive product offerings, outstanding services and innovative business models, we have won increasing recognition from our users”, said Nio Chairman and CEO William Li. Due to the Covid-19 pandemic, Nio sold only 3.838 vehicles in the first quarter last year. But its sales rose as the pandemic was under control in China and a government fund in Hefei, Anhui province, decided to invest in the company. Nio’s total revenue in the year hit $2.49 billion; up 107.8 % year-on-year, and the gross profit was $287 million. It was the first year for the startup to see positive gross profit. Its net loss fell to $813 million in 2020; down 53 % from the previous year. The startup’s research and development investment totaled $381 million; down 48.3 % from 2019. Nio said the decrease was mainly attributed to the decrease in design and development costs, driven by the company’s overall cost-saving efforts and the improved operational efficiency. “We are confident about the company’s long-term competitiveness and will continue to make decisive and efficient investments in products, core technologies and user service”, said Wei Feng, Nio’s chief financial officer. +++ 

+++ NISSAN plans to expand its portfolio of electric vehicles in the key U.S. market ,in line with demand for battery-powered versions of its mainstay cars and SUVs, the firm’s chief operating officer has said. “What’s very important is to do electrification on sedans and SUVs”, Ashwani Gupta said in an interview. “Our focus is on our core products”. The automaker, which was an early entrant into the EV market with the Leaf a decade ago, is working on next-generation SUVs with electrified powertrain options. Even so, Nissan isn’t rushing to join a stampede (by rivals ranging from General Motors and Ford to Tesla and Rivian Automotive) into battery-powered trucks, the executive said. Buyers of full-sized pickups such as Nissan’s Titan model aren’t clamoring for electrified trucks. Instead, they want features such as towing power that an electric truck may not be able to provide with current battery technology, according to the chief operating officer. “When I talk to customers from Texas who are driving my Titan, their answer is ‘no’ to electric pickups”, Gupta said. “When they will start asking for it? That’s the million-dollar question”. Nissan announced earlier this year that it plans to electrify all-new models it releases in major markets, including the U.S., by the early 2030s. Nissan is hoping to turn around its much-shrunken U.S. business with a slew of new models to update its aging lineup. It needs those after posting an 8th straight quarterly sales decline in the last 3 months of 2020, when U.S. sales dropped 19 %. Pandemic-depressed demand dragged down deliveries 33 % to 899.217 vehicles for the year; the lowest since amid a recession in 2009. A recovery hinges on demand for 4 marquee vehicles that Gupta expects will make up 75 % of U.S. sales: the bestselling and remodeled Rogue / X-Trail, the new Ariya and refreshed versions of its Frontier midsize pickup and Pathfinder SUV. The Rogue accounted for about 25 % of Nissan’s U.S. sales last quarter, but now accounts for one-third of volume, Gupta said. Nissan eked out a slim operating profit of ¥27.1 billion for the 3 months through December, aided by a recovery in the North American market, which was profitable due to improving quality of sales in the region, Gupta said. “We’re on the right track”, the COO stressed. “If we keep fixed cost optimized and focus on quality of sales (driven by value-pricing, higher credit score, higher customer profile) we’ll drive profitable growth”. +++ 

+++ The RANGE of electric cars is one of their biggest selling points: the longer the better. That is about to change, as such vehicles are becoming a common choice in the mass market and charging infrastructure is more accessible. Batteries are, so far, the most expensive part of electric vehicles. They account for around half a vehicle’s cost. The longer the range, the more the batteries cost. As electric vehicles are no longer toys of the rich, carmakers have turned to less expensive batteries that power a shorter but still decent range. Most customers are price-sensitive but few of them make long trips on a daily basis. Statistics from the China Automotive Battery Research Institute show that the installed capacity of electric batteries in 2020 rose 2.3 % year-on-year. It was primarily driven by the surge in lithium iron phosphate (LFP) batteries. Compared with the popular ternary lithium batteries, LFP ones have a shorter range but they are safer to use and, more importantly, less expensive. Last year, LFP batteries’ installed capacity totaled 24.383 megawatt hours; up 20.6 % year-on-year. They were the only battery segment that saw positive growth in the year, according to the institute. The surge had increased the share of LFP batteries to around 39 % in China’s battery market. But it still trails ternary lithium batteries, which accounted for more than 60 %. Tesla, whose vehicles are known for long ranges, started to launch vehicles featuring LFP batteries in China last year at a lower price. This, in turn, fueled the brand’s popularity. Another brand, Wuling, has driven the trend further. Its 2-seater mini Hongguang electric vehicle was the second-most popular model after Tesla’s Model 3. More carmakers are joining in, with some offering 2 types of batteries. As China is to withdraw subsidies by the end of 2022, more medium-range vehicles will feature less expensive LFP batteries, according to analysts. Audi CEO Markus Duesmann said long ranges will not be the trend forever. “Later on they will go down because charging infrastructure is denser and also the interior space experience of customers”, he said. “Battery sizes will go down again, because they make the cars unnecessarily heavy and unnecessarily expensive. And unnecessarily big, too”. By the end of 2020, China had 4.21 million electric cars on its roads and there were 1.68 million charging piles. It means around 2.5 vehicles can share a charging pile. The ratio will stay around the same this year, said Tong Zongqi, a senior executive at the country’s charging infrastructure alliance. Battery makers are devising methods to improve the range of LFP batteries. Last year, BYD unveiled blade-shaped LFP batteries. They are said to increase the energy density per unit of volume by 50 %. That means it enables a battery pack of the same size to power a range of 600 km from 400 km. BYD chairman Wang Chuanfu said the LFP batteries were mainstream products when the electric car sector was in the early stages. Customers’ preference for long-range vehicles prompted government subsidies on such vehicles, and that lured carmakers to ternary lithium ones. “But their widespread use has resulted in the rise of electric vehicle fire accidents”, Wang said. LFP batteries remain stable even when the temperature reaches 500 degrees. Meanwhile, ternary lithium ones will start to have a chemical reaction at around 200 degrees, said Sun Huajun, a senior executive at BYD’s battery subsidiary. Battery makers including BYD and CATL as well as their suppliers are stepping up efforts in LFP batteries. Statistics show that the prices of materials have gone up by 10 % from November as demand soars. Earlier this month, Huayuan Titanium Dioxide, a Shenzhen-listed company, announced a 12.1 billion yuan ($1.86 billion) plan to build a production line capable of producing 50 metric tonnes of LFP materials a year. CATL inked a 1.8 billion yuan deal with Shenzhen Dynanonic, which is a listed LFP material manufacturer, in January, in an effort to meet the growing demand for LFP batteries. Last year, sales of electric cars and plug-in hybrids went up almost 11 % to 1.37 million in China. It was the only rising segment in the auto market’s overall downward spiral because of Covid-19. Around 1.8 million New Energy Vehicles will be sold this year, according to the China Association of Automobile Manufacturers. Chinese authorities expect such vehicles to account for 20 % of new car sales in 2025. +++ 

+++ RENAULT SAMSUNG is minded to halt night shifts from next week after recording its first loss in 11 years last year and losing the bulk of its production orders. The automaker already started taking applications for early retirement last month, and around 100 workers have applied so far. If not enough workers sign up voluntarily, the company is expected to furlough its 4.200 employees on rotation. The automaker’s production plant in Busan manufactured 260.000 cars a year until 2017. But last year it made just 110.000, causing Renault Samsung a W70 billion deficit. Its production target for this year is only 100.000 vehicles. The crisis started in September 2019, when the production contract for the Nissan X-Trail ended. It accounted for half of the Busan plant’s annual output. The company put off allocating another model for production there when workers there went on strike in 2019 and 2020. Renault headquarters in France finally assigned the Busan plant the small XM3 (Arkana) for export to Europe, but production volume is only 30 % of the X-Trail. The French automaker recently announced restructuring plans to reduce its annual global output from 4 million to 3.1 million cars. It singled out the Busan plant as one of its least profitable overseas operations. There are rumors that Renault is considering pulling out of Korea altogether, raising fears that the country’s other foreign-owned automakers could follow suit. GM suffered cumulative losses of around W3 trillion over the last 7 years and Mahindra, which owns Ssangyong, suffered W1.8 trillion in losses over the last 13 years. The 3 employ around 300.000 people in Korea. +++ 

+++ SOUTH KOREA ’s exports of electric vehicles advanced nearly 66 % on-year in 2020, data showed, despite the overall slump in the automobile industry amid the COVID-19 pandemic. Outbound shipments of electric vehicles came to $3.9 billion in 2020, the first time the figure surpassed that for hybrid cars, whose exports came to $2.5 billion last year, according to the data compiled by the Korea International Trade Association. Electric vehicles accounted for more than half of the combined outbound shipments of eco-friendly cars, which were estimated at $7.1 billion. Europe was the largest destination for South Korea’s eco-friendly cars, taking 68 % of the total. +++ 

+++ SSANGYONG said its sales plunged 61 % last month from a year earlier on lower demand for its vehicles amid the Covid-19 pandemic. It sold 2.789 vehicles in February; down from 7.141 units a year ago due to a sharp decline in domestic sales and exports, the company said in a statement. Domestic sales fell 48 % to 2.673 units last month from 5.100 the previous year, and exports plummeted 94 % to 116 from 2.041, it said. SsangYong’s lineup consists of the flagship Rexton, as well as the Tivoli, Korando and Rexton Sports. Indian parent Mahindra is in the process of selling its majority stake in SsangYong to reorganize its investments amid the pandemic. In 2011, Mahindra acquired a 70 % stake in SsangYong for 523 billion won and now holds a 74.65 % stake in the carmaker. Debt-laden Ssangyong filed for court receivership in December, as it struggles with snowballing debts amid the pandemic. +++ 

+++ TOYOTA may have pioneered the just-in-time manufacturing strategy but when it comes to chips, its decision to stockpile what have become key components in cars goes back a decade to the Fukushima disaster. After the catastrophe severed Toyota’s supply chains on March 11, 2011, the world’s biggest automaker realized the lead-time for semiconductors was way too long to cope with devastating shocks such as natural disasters. That’s why Toyota came up with a business continuity plan (BCP) that required suppliers to stockpile anywhere from 2 to 6 months’ worth of chips for the Japanese carmaker, depending on the time it takes from order to delivery, 4 sources said. And that’s why Toyota has so far been largely unscathed by a global shortage of semiconductors following a surge in demand for electrical goods under coronavirus lockdowns that has forced many rival automakers to suspend production, the sources said. “Toyota was, as far as we can tell, the only automaker properly equipped to deal with chip shortages”, said a person familiar with Harman International, which specializes in car audio systems, displays and driver assistance technology. 2 of the sources who spoke are Toyota engineers and the others are at companies involved in the chip business. Toyota surprised rivals and investors last month when it said its output would not be disrupted significantly by chip shortages even as Volkswagen, General Motors, Ford, Honda and Stellantis, among others, have been forced to slow or suspend some production. Toyota, meanwhile, has raised its vehicle output for the fiscal year ending this month and jacked up its full-year earnings forecast by 54 %. The source familiar with Harman said the company, part of South Korea’s Samsung Electronics, was experiencing shortages of central processing units (CPUs) and power management integrated circuits as early as November last year. While Harman doesn’t make chips, because of its continuity deal with Toyota, it was obliged to prioritize the carmaker and ensure it had enough semiconductors to maintain supplies of its digital systems for 4 months, or more, the source said. The chips in especially short supply now are microcontroller units (MCUs) which control an array of functions such as braking, acceleration, steering, ignition, combustion, tire pressure gauges and rain sensors, the 4 sources told. However, Toyota changed the way it buys MCUs and other microchips after the 2011 earthquake, which caused a tsunami that killed more than 22.000 people and triggered a deadly meltdown at Fukushima’s nuclear power plant. In the aftermath of the quake, Toyota estimated its procurement of more than 1.200 parts and materials might be affected and it drew up a list of 500 priority items that would need secure supply in the future, including semiconductors made by key Japanese chip supplier Renesas Electronics. The repercussions of the disaster were so severe it took 6 months for Toyota to get production outside Japan back to normal levels, having done so at home 2 months earlier. It was a big shock to Toyota’s just-in-time system because a smooth flow of components from suppliers to factories to assembly lines (as well as lean inventories) were central to its emergence as an industry leader for efficiency and quality. At a time when supply chain risk is now front and centre in almost every industry, the move shows how Toyota was ready to throw out its own rule book when it came to semiconductors, and is reaping the rewards. A Toyota spokesman said 1 of the goals of its lean inventories strategy was to become sensitive to inefficiencies and risks in supply chains, identify the most potentially damaging bottlenecks and figure out how to avoid them. “The BCP for us was a classic lean solution”, he said. Toyota pays for its stockpiling arrangement with chip suppliers by returning a portion of the cost cuts it demands from them each year during the life cycle of any car model under so-called annual cost-down programs, the sources said. Inventories of MCU chips (which often combine multiple technologies, CPUs, flash memory and other devices) are held for Toyota by parts suppliers such as Denso, which is partially owned by Toyota Group, chip makers like Renesas and Taiwan Semiconductor Manufacturing, and chip traders. While there are different kinds of MCUs, those in short supply now are not cutting-edge chips but more mainstream ones with semiconductor nodes ranging from 28 to 40 nanometers, the sources said. Toyota’s continuity plans for chips has also cushioned it from the impact of natural disasters exacerbated by climate change, such as fiercer typhoons and rain storms which often cause floods and landslides across Japan, including the southern Kyushu region manufacturing hub where Renesas also makes chips. One of the sources involved in semiconductor supply, said Toyota and its affiliates had become “extra risk averse and sensitive” to the impact of climate change. But natural disasters and are not the only threat on the horizon. Automakers fear there will be more disruptions to chip supplies because of rising demand as cars become more digital and electric, as well as fierce rivalry for chips from makers of smart phones to computers to aircraft to industrial robots. The sources said Toyota has another advantage over some rivals when it comes to chips thanks to its long-standing policy of ensuring it understands all the technology used in its cars, rather than relying on suppliers to provide “black boxes”. “This basic approach sets us apart”, said one of the sources, a Toyota engineer. “From what causes flaws in semiconductors to gory details about production processes like what gases and chemicals you use to make the process work, we understand the technology inside and out. It’s a different level of knowledge that you can’t simply gain if you’re just buying those technologies”. There has been an explosion in the use of semiconductors and digital technologies by automakers this century thanks to the rise of hybrid and fully electric vehicles, as well as autonomous driving and connected car functions. Those innovations require even more computing power and use in part a new category of semiconductors called system on a chip, or SoC, which roughly speaking combines multiple CPUs on one logic board. The technology is so new and specialized many carmakers have left it to big parts suppliers to manage the risks. In keeping with its no black box approach, however, Toyota developed a deep in-house understanding of semiconductors to prepare for the launch of its successful Prius hybrid in 1997. Years before, it poached engineering talent from the chip industry and opened a semiconductor plant in 1989 to help design and manufacture MCUs used to control Prius powertrain systems. Toyota designed and manufactured its own MCUs and other chips for 3 decades until it transferred its chip-making plant to Denso in 2019 to consolidate the supplier’s operations. The 4 sources said Toyota’s early drive to develop a deep understanding of semiconductor design and manufacturing processes was a major reason why it has managed to avoid being hit by the shortages, in addition to its continuity contracts. 2 of the sources, however, said they were worried the Denso deal might indicate that Toyota was finally willing to ditch its no black box approach, even though the supplier is part of the broader Toyota Group. “We were okay this time, but who knows what awaits us in the future?” one source said. “We may be losing our grip on technology in the name of technological development efficiency”. +++ 

+++ VOLKSWAGEN , the namesake brand of the Volkswagen Group, expects half of its vehicles sold in China to be electric by 2030. This is part of Volkswagen’s strategy, called Accelerate, which also highlights software integration and digital experience as core competencies. China, which is the largest market for both the brand and the group, has been the world’s largest market for electric cars and plug-in hybrids. There were 5.5 million such vehicles on its roads by the end of 2020, according to statistics from the Ministry of Industry and Information Technology. Last year, 2.85 million Volkswagen-branded vehicles were sold in China, accounting for 14 % of total passenger vehicle sales in the country. Volkswagen now has 3 electric cars in the market, with another 2 built on its dedicated electric car platform to follow soon this year. The brand said it will unveil at least 1 electric vehicle every year to realize its new electrification goal. In the United States, Volkswagen has the same target as in China, and in Europe it expects 70 % of its sales by 2030 to be electric. Volkswagen started its electrification strategy in 2016; 1 year after it admitted to cheating on diesel emissions in the United States. It has earmarked around €16 billion for investment in the future trends of e-mobility, hybridization and digitalization up to 2025. “Of all the major manufacturers, Volkswagen has the best chance of winning the race”, Volkswagen CEO Ralf Brandstätter said. “While competitors are still in the middle of the electric transformation, we are taking big steps toward digital transformation”, he said. Carmakers worldwide are pursuing zero-emission strategies to meet carbon dioxide emissions targets. Last week, Volvo said it would become electric by 2030. “There is no long-term future for cars with an internal combustion engine”, said Henrik Green, Volvo’s chief technology officer. In February, Jaguar set a timetable to become fully electric by 2025. In January, General Motors unveiled plans to have an all zero-emissions lineup by 2035. Stellantis, the product of the merger between Fiat Chrysler and PSA, plans to have fully-electric or hybrid versions of all of its vehicles available in Europe by 2025. +++

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