+++ With its Beyond 100 plan in place, a strategy for 5 new electric vehicles in 5 years from 2025 and record annual sales in 2021, BENTLEY is on a roll. I spoke to chairman Adrian Hallmark during a seminar to find out more. Question: “You’ve confirmed Bentley’s first EV will be built in Crewe. Was it ever not going to be?”. Answer: “There was always a chance. But in this transition period between combustion-engine vehicles and battery-electric vehicles, there’s even more pressure than has been in the past to not invest in more infrastructure and to fully utilise capacities and facilities that are already there. But it’s our commitment to maximise the number of cars that we bring to the UK. It’s never guaranteed, but I’m delighted that we’ve convinced the shareholders to stick with us”. The announcement was part of a wider €3 billion investment. Q: Where’s the money coming from and what does it buy? A: “The most important thing for us is all of that investment comes from our own cashflow. We won’t borrow and we won’t go into deficit to fund this. We will do it from our own cashflow and reserves. “In terms of where it goes, let’s be honest: cars cost a lot more to develop than infrastructure. So I would estimate that about 15-20% of that will go into the site. We’ve already spent a lot to get some of the administrative and test facilities completely rebuilt. But the rest, 80% or so, is in the product. And each car, as we know, is a significant cost. It’s a four- to five-year development programme”. Q: How important is Crewe to Bentley? A: “How important is Bentley to Crewe as well? 75 years we’ve been here. We have 4.500 people who are at the peak of the skills in our industry and better than most suppliers out there, because we’ve kept wood, leather and trim as a core competence, and that will continue for the future. If we’re going to keep leadership in that space, those skills can’t be obtained overnight. And we see a great advantage of that being here. But it’s not just that. If you’re investing the kind of money that our customers do in buying a Bentley, it has to be authentic. It has to come from Bentley. So while we’re always in competition for certain parts of the production process with Volkswagen Group facilities, we will always fight to have the maximum here. So in the future with the EV, we intend to do the same. We don’t envisage a sheet metal and body shop on site; we do envisage a brand-new, state-of-the-art paint shop. We’re also changing the engineering prototype workshop and the launch quality centre, where we trial production before it goes into the factory. By doing that, we will empty the hall on the main site, which is as big as the current assembly hall that built our 14.500 cars last year. We will then completely renovate that hall and put in the new production system, with floor-mounted, autonomous, guided production trolleys and supplier components. The bodies will come in, we will paint them and go through the same added-value process that we do today, which is way more than any other UK luxury [car]manufacturer. And because the cost is effective, the quality is unbeatable. And it makes Bentley absolutely authentic”. Q: You’re very bullish about the future of the super luxury market. Can you tell us more about that? A: “The growth potential is so big that you wouldn’t know where to start. When the Continental GT was launched back in 2003, there were, according to Credit Suisse, six million people on Earth with more than $1 million free-floating in stocks, equities and other non-property investments. Today, that figure is close to 17 million, so it has trebled. In 2003, the market for cars like the GT and Flying Spur was about 3.500 worldwide. Last year, it was about 68.000. We’re seeing a steady and inexorable rise in that demand, and we expect that to continue. And with zero-tailpipe emissions cars and a totally sustainable supply chain, we think we can give another push and attract to luxury a new generation of buyers who don’t associate themselves with 12-cylinder engines”. How do you make software and charging luxurious? “We have a mission on what we call five usage cases, to have not just the best sound experience but the best other experiences in the car and that’s luxury. As autonomous driving kicks in and as people can do more in the car, even if they’re being chauffeured by a real chauffeur or a digital one, we want to take the experience in the vehicle to a completely different level. So it’s not about the look, the aesthetics or the way we do the icons on the screen. It’s about the functionality that we can build in. And we’ve got five fields of activity that we want to lead in. The good thing about software is that it’s not as expensive as hardware, especially in this space. What we’re working on, together with the group but also with some other start-ups, is charging solutions at home, whether that’s inductive or robotic. All of these things can be done at relatively low cost with a bit of innovation, and they can take the hassle away”. Do you see synthetic fuels or hydrogen fuel cells being part of the conversation? “You can look at the maturity of those technologies and when they can be fed into the market industrialised, certified, validated and safe. Hydrogen? Absolutely. If you look at it within a vehicle, it’s a viable option. But where do you get it from? You have to produce it, and to do so means huge amounts of energy. And if that energy isn’t renewable, burning fossil fuels to create a product to then burn that in an engine is worse than making oil. So hydrogen works only if it’s made with renewables. There’s also the dilemma, ethical and environmental, that if the whole system isn’t using renewable energy but you use renewable energy to produce hydrogen, you’re just substituting that from the core energy supply. So really for hydrogen to work from a total environmental point of view, the whole energy system needs to be green”. Q: How proud are you of your sales success? A: “They say that pride comes before a fall. Don’t get me wrong: do I feel great about 2021? Yes. But I would have felt greater if that had happened in 2020, which we were set up to do before Covid hit. It’s thanks to the performance and capability of this team that we’ve come through Covid and delivered this outstanding result. I will give you one other statistic. For me, it’s incredible. We started 2021 with the biggest ever order bank, we went through the year and we grew by 31 %. By the end of the year, we had 30 % more orders than we had on 1 January 2021. So that means we not only grew 30 %, but also the order intake was 30 % above that. I will be proud only when the EV products are developed, the first ones delivered and we start to see that shift towards sustainable carbon-neutral Bentley by 2030. Hopefully, our customers will come with us in the way that they’ve already said [they will]and we will be the leader and be sustainable”. +++
+++ Accelerating sales of ELECTRIC VEHICLES have fueled a scramble for nickel, cobalt and lithium, propelling prices of the battery materials to multi-year highs. Phasing out internal combustion engine (ICE) cars in favor of electric vehicles is part of the energy transition and efforts to cut carbon emissions. More than 6.36 million electric vehicles were sold last year globally compared with 3.10 million in 2020, data from Rho Motion shows. China accounted for half of the total last year and 40% the previous year. Shortages of nickel have led to draws on stocks in London Metal Exchange approved warehouses, which at 88.182 tonnes have dropped 65 % since April last year. More pertinent are stocks of bagged briquette, easily crushed into small particles and dissolved in sulphuric acid to make nickel sulphate for batteries, at 65.676 tonnes down 67% since last April. Analysts say most of this briquette has been shipped to China, which controls the electric vehicle supply chain. Wood Mackenzie analyst Andrew Mitchell estimates total nickel demand at 2.8 million tonnes last year, of which 69 % was used to make stainless steel and 11% to make batteries, from 71 % and 7 % respectively in 2020. Mitchell expects batteries’ share of nickel demand to rise to 13 % this year. “We are looking at higher average prices this year”. Nickel hit $24,435 a tonne last week, the highest since August 2011. It is expected to retreat later this year as supplies ramp up. Macquarie’s Jim Lennon expects nickel supplies to rise 14.5 % this year to 3 million tonnes and a surplus of 43.000 tonnes from a deficit of 159.000 tonnes in 2021. Coronavirus lockdowns in southern Africa created bottlenecks that delayed shipments to China from Democratic Republic of Congo, which accounts for more than 70 % of global supplies. “Chinese imports of cobalt hydroxide only increased 2.5% to 82.100 tonnes last year from 2020, meaning domestic stocks were drawn down considerably”, said Benchmark Mineral Intelligence (BMI) analyst Caspar Rawles. BMI expects total cobalt demand at 177.500 tonnes this year, of which 104.000 tonnes will be consumed by the battery sector. Cobalt prices at around $70.000 a tonne are at their highest since July 2018. Traders expect further gains as Chinese consumers restock. Deficits have pushed prices of lithium carbonate to record highs above $50.000 a tonne in China, according to BMI. Lithium carbonate is used for lithium iron phosphate (LFP)batteries. Sales of electric vehicles which use these batteries have accelerated in China. Lack of investment in capacity due to sliding prices in the 3 years to 2021 means deficits are likely for some years. “Supply is struggling to keep up with demand, given long lead times to bring first production from lithium resources to market”, said BMI analyst George Miller. Electric vehicle batteries can use lithium carbonate or lithium hydroxide. The industry typically talks of lithium carbonate equivalent (LCE) which contains both. BMI estimates demand for lithium carbonate equivalent at 610.000 tonnes this year, up from 490.000 tonnes last year, and a deficit of 26.000 tonne from a shortfall of 12.000 tonne. +++
+++ In December 2018, FORD submitted patent application to the U.S. Patent and Trademark Office for a Manual Transmission with Electric Clutch. The USPTO published the patent last November, Muscle Cars & Trucks discovered the paperwork this month. What we’re talking about is another version of the automated manual transmission, a technical milestone the automotive industry passed more than 70 years ago. What’s more interesting is the bit of MC&T supposition that comes with the patent discovery, that this transmission could find its way into the next-generation S650-series Mustang. Mechanically speaking, the basics are all here, including a set of gears to manually shift through, tweaked with the potential use of clever sensors in the shift knob. Without a clutch pedal, the powertrain would understand when to shift by noting when the driver has gripped the shifter and started to move it, operating like the everyday manual transmission in everyday use. However, according to the patent, electronic control of what might be “a dry friction clutch” can be fine-tuned based on how the driver applies his fingers or pressure to the shift knob. The patent says the shift knob shell “is flexible, at least in some areas, allowing the driver to slightly deform, i.e., crush, the knob.” In certain applications, the “magnitude of squeeze applied by the driver” could mimic working a clutch pedal, with harder squeezes decoupling the clutch further, softer ones doing the opposite. Another type of delicate, fingertip-controlled clutch operation would let the driver activate neutral by using a button or another kind of squeeze on the knob, instead of needing to shift to neutral. The patent claims the point of this innovation is to give “many people, especially driving enthusiasts, the increased driver interaction” of a manual, without “the negative attributes” of doing a calf raise every time a new gear is needed. This makes the Ford patent much like the Kia Intelligent Manual Transmission (IMT) that debuted in the European Kia Rio in 2020, which was developed for the same reason. The Kia IMT is designed for mild hybrids, using the electric bits of the powertrain to turn the engine on and off throughout a wider range of operation, possible since the car can control the clutch on its own. Ford’s idea is suited for longitudinally-mounted transmissions in rear- and all-wheel-drive cars. The 2024 Mustang will offer hybrid powertrains, it’s possible Ford had this in mind, too. The Bronco might also work. As we always say, though, it’s a long way from patent to production, so this could come and go no further than the Internet. +++
+++ FORD plans to suspend or cut production at 8 of its factories in the United States, Mexico and Canada throughout next week because of chip supply constraints, a spokeswoman told. The changes come a day after the Detroit automaker warned a chip shortage would lead to a decline to vehicle volume in the current quarter. Production at factories in Michigan, Chicago and in Cuautitlan, Mexico will be suspended. In Kansas City, production of its F-150 pickup trucks will be idled while one shift will run for production of its Transit vans. The Detroit automaker will also run a single shift or a reduced schedule at its factories in Dearborn, Kentucky and Louisville, while removing overtime at its Oakville factory in Canada. Ford shares slumped on Friday, after the automaker posted smaller-than-expected quarterly income and forecast a slower recovery in 2022 vehicle production than rival General Motors. However, the company said it expected vehicle volume to improve significantly in the second half. +++
+++ There’s a fun little challenge on social media where someone asks their worldwide audience, “Tell me X without telling me X”. If we were playing the game with GENERAL MOTORS , we’d say, “Tell me you’re killing the Chevrolet Bolt without telling me you’re killing the Chevrolet Bolt”. If you’ll remember, it was only a few days ago we surveyed opinions among CNN and Automotive News that Chevrolet has already bought a cremation appointment for the Bolt but doesn’t want to admit it. Those two takes were based on the fact that the Lake Orion Assembly plant that builds the Bolt is being converted to build GM’s coming electric pickups, all of which will be more popular and are on a different, better platform than the subcompact hatch, and the fact that GM wouldn’t say anything about how much life its lovely, tiny crossover has left. The loose prediction was that the coming, $30,000 battery-electric Equinox would replace the Bolt, offering more room and a better powertrain for less money. Now we have GM CEO Mary Barra’s comments during GM’s call with analysts to discuss Q4 2021 results. As part of her lengthy opening comments, Barra took a dig at startup EV automakers (Tesla, Lucid, Rivian, et al) and threw the Bolt under a GM Cruise autonomous taxi when she said, “The efficiencies created by the Ultium platform are a key reason why we will be able to deliver truly affordable EVs like the Equinox. Affordable EVs are part of the market that start-ups aren’t targeting, but they are key to driving mass adoption of EVs, which is a national and a global priority. That’s why we plan to follow the Equinox with an even more affordable EV”. Later in the call, answering a question from a Morgan Stanley analyst about why GM is launching so many EVs in such a short window, Barra re-emphasized how important it is to make EVs affordable for the folks with the leanest budgets. She replied: “And that’s why you look at the Equinox and how significant that can be, the more affordable EV that we’re going to be doing that really gets into another very important part of the market. So you have to have the proper market coverage”. At the time of writing, the Bolt (Opel Ampera-e) costs $32.495 after destination, before state-level incentives. To hammer home the point about this car’s death, the electric Equinox will be larger, less expensive, and run on the newer and more efficient Ultium internals as opposed to the Bolt’s BEV2 guts. An EV positioned underneath the electric Equinox, well, is the Bolt. Except that new EV will be Ultium based, making it that much more financially accessible than the Bolt, with better performance. +++
+++ MG is looking to significantly expand its product portfolio as the marque approaches its centenary in 2024, with the aim of attracting new buyers in new segments and continuing on its steep growth trajectory. In the 16 years since being acquired by the Chinese state-owned SAIC, MG has established itself as a leading maker of value-oriented yet well-equipped and safe family cars, selling more than 52.000 across Europe in 2021, far more than half of which were in the United Kingdom, its spiritual home. It plans to triple that figure in 2022 on its way to reaching one million sales across 100 global markets by 2024. Crucial to this goal will be the introduction of new cars. The 5 SW EV and ZS EV are already among the most popular electric cars in Europe, and MG will look to build on this success by appealing to younger drivers and enthusiasts with an all-new product line designated Cyber in reference to its five primary priorities: co-creating, young, beyond, evolution and recreation. The initiative was first outlined last year with the unveiling of the Cyberster concept: an electric roadster that at once nodded to MG’s heritage as a British sports car manufacturer and previewed the technical capabilities and functionality of its future cars. Cyberster production was approved after the Shanghai motor show as a result of a successful crowdfunding campaign in which more than 5.000 prospective buyers signed up to MG’s interactive Cybercube platform, allowing them to inform development of the production car. It’s now set to be launched as part of MG’s centenary celebrations. A brand spokesman said: “We are working on a surprise for you guys. Of course we know we were the affordable sports car brand in the past, and now we are the new electric vehicle brand, and we will surprise you. We will be in markets that nobody has been in before”. Indeed, no mainstream brand has yet launched an affordable, convertible electric sports car. While some of the concept’s more outlandish features will be lost, MG’s UK design boss, Carl Gotham, hinted that a toned-down version will make it to dealerships, calling it “a bold statement that looks strongly into MG’s future, touching on our heritage but more importantly building on our cutting-edge technology and advanced design”. Beyond its design, the Cyberster indicates the shift in priorities for MG with its new range of EVs. “Sports cars are the lifeblood of the MG DNA and the Cyberster is a hugely exciting concept for us”, said Gotham, suggesting that now MG has established itself with mainstream cars, it can afford to explore other segments. That said, the 2017 E-Motion sports coupé concept has yet to reach production, despite patents filed in 2020 revealing a seemingly road-ready design. The Cyberster sits on an all-new platform built around 2017 E-Motion coupé concept is supposed to become production car a ‘cell-to-pack’ battery, which does away with the conventional module structure used by current EVs in the name of increased production efficiency and power density. It’s claimed to yield an 800 km range. A single motor, using the same efficiency-boosting ‘hairpin’ wiring technology as the ZS EV and presumably mounted at the rear, supplies a sub-3.0 seconds 0-100 kph time. +++
+++ In the UNITED KINGDOM, new car registrations surged 27.5% year on year in the UK last month, shoring up optimism that the industry is on its way to recovery from heavily reduced volumes in 2021. The latest figures from the Society of Motor Manufacturers and Traders (SMMT) show that 115.087 new cars were registered in January, some 24.838 more than the same month last year, when dealerships were forced to close in line with social distancing restrictions. However, the SMMT notes, the ongoing chip shortage continues to restrict sales volumes, with registrations down 22.9 % compared with January 2020. The growth came chiefly from the private market, which the SMMT attributes to manufacturers prioritising individual buyers, rather than fleets, in light of reduced production capacity. Some 62.300 cars went to private buyers, a 64.1 % year-on-year increase and just 5.6 % down on pre-pandemic levels. Fleet registrations, by contrast, remained steady at 50.817 units, down just 0.4 %. It was another bumper month for registrations of electrified vehicles, with pure-electric cars, plug-in hybrids and full hybrids accounting for a huge 71.5 % proportion of the increase in registrations. Almost a third of all new cars registered in January were electrified, of which 9.047 were PHEVs and 14.433 were pure-electric. The SMMT says there are more than 140 plug-in models available in the UK, with 50 more scheduled to enter the market in 2022, but the trade body adds that uptake of such cars continues to be hampered by “perceptions of a lack of charging infrastructure, which must be built ahead of demand”. The body predicts that registrations of pure EVs will climb 61 % and PHEVs 42 % in 2022, amounting to a 25 % market share for plug-in cars by the end of the year. More generally, it forecasts a 15.2 % increase in registrations this year, which equates to 1.897 million units; down on an estimate of 1.96 million made in October as a result of the semiconductor shortage, and 17.9 % down on 2019. But, said the SMMT: “the recovery is expected to continue into 2023, with the market projected to climb above two million units for the first time since 2019”. Chief executive Mike Hawes said: “Given the lockdown-impacted January 2021, this month’s figures were always going to be an improvement but it is still reassuring to see a strengthening market. Once again, it is electrified vehicles that are driving the growth, despite the ongoing headwinds of chip shortages, rising inflation and the cost-of-living squeeze. 2022 is off to a reasonable start, however, and with around 50 new electrified models due for release this year, customers will have an ever greater choice, which can only be good for our shared environmental ambitions”. The Vauxhall Corsa topped the rankings in 2021 after an unusual year as the market was hit hard by the semiconductor shortage and ongoing upheaval due to the pandemic, with issues likely to continue into 2022. So in January, the bestselling models in the UK were: 1. Kia Sportage (3.458), 2. Ford Puma (2.608), 3. Kia Niro (2.372), 4. Mini Hatch 3dr/5dr (2.313), 5. Vauxhall Corsa (2.285), 6. Hyundai Tucson (2.236), 7. Vauxhall Mokka (2.194), 8. Ford Focus (1.822), 9. Volkswagen T-Roc (1.813) and 10. Toyota Corolla (1.767). +++