Newsflash: Mercedes-Benz heeft de CLE bijna klaar


+++ In CHINA , sales of local car brands jumped 81.5 percent year-on-year in the first quarter of the year, continuing to gain a larger share in the domestic market, industry data showed. More than 2.1 million Chinese-brand passenger cars were sold across the country in the period, according to the China Association of Automobile Manufacturers. The market share of these brands accounted for 41.5 percent in the Chinese market during the period, up 1.4 percentage points from one year earlier. In March alone, sales of Chinese brand passenger vehicles surged 71.4 percent year-on-year to 745.000 units, accounting for 39.8 percent of the domestic market. +++

+++ Chinese automakers warned they may have to put the brakes on production if strict COVID-19 curbs in Shanghai persist, with a top Huawei executive also sounding the alarm Friday about snarled supply chains. The restrictions have kept Shanghai’s 25 million residents mostly at home for weeks, forcing manufacturers to halt operations and making China’s GDP growth target of around 5.5 percent look increasingly difficult to achieve. Covid-19 outbreaks across the country and the associated reductions in economic activity have already hit the auto industry hard, with car sales dropping 10.5 percent in March. “If supply chain companies in Shanghai and its surrounding areas cannot find a way to dynamically resume work and production, all original equipment manufacturers may have to stop production in May”, XPeng chief He Xiaopeng said Thursday on social media. XPeng has been touted as a Chinese challenger to U.S. electric car giant Tesla, and its chief said that businesses were hoping for more support from the authorities to navigate the Covid-19 closures. A top executive at Chinese tech giant Huawei (which has started to work with domestic auto manufacturers in the intelligent vehicle sector) echoed the comments on Friday and warned the clock was ticking. “If Shanghai continues being unable to resume work and production, from May, all tech and industrial players involving the Shanghai supply chain will completely shut down, especially the auto industry!” Richard Yu, head of Huawei’s consumer and auto segment, said on the social media platform WeChat. Huawei sold its first 3.000 electric vehicles with the company’s HarmonyOS operating system in March. The group has been working with automakers to provide intelligent auto components, but does not make cars on its own. The Covid curbs have affected global brands as well, with Volkswagen saying it has been “severely hit by Covid-19 outbreaks in Changchun and Shanghai”, where the German titan’s Chinese joint ventures are located. The firm is “temporarily unable to meet high customer demand”, said Volkswagen Group China boss Stephan Wollenstein on Thursday, adding that he hoped the production delays could be made up in the coming months. China’s zero-Covid-19 policy has been increasingly strained as the country battles its highest number of infections since the start of the pandemic. Volkswagen said around 20 percent of its dealers were forced to temporarily close in March alone as a result of lockdowns. Tesla’s multi-billion-dollar “gigafactory” in Shanghai, which the company calls its main export hub, has also been reportedly shut. Chinese electric vehicle maker Nio said last weekend that it had suspended vehicle production, as business partners in virus-hit areas such as Jilin and Shanghai halted operations. +++

+++ KIA and South Korean last-mile delivery service firm Coupang announced Friday that they had signed an agreement Wednesday to develop all-electric vehicles for cargo delivery. The 2 companies plan to launch midsized and large electric cargo vans by 2025, with better storage, efficiency and safety than Coupang’s current 1-ton cargo truck. Kia said it would use its experience and technology in the automobile sector to offer diverse solutions and services requested by Coupang to come up with vehicles tailored to delivery services. The vehicle is likely to have sliding doors and lighter shelves, among other engineering improvements, to boost the work efficiency of delivery workers, Coupang said. According to Kia, the purpose-built vehicles will use a “skateboard” chassis as the basis for the battery-powered vehicle architecture. Kia and Coupang also plan to work on charging infrastructure and test autonomous driving of the vehicles. “We hope to make greater achievements in delivery efficiency, safety and convenience through cooperation with Kia”, a Coupang official said. Kia said the agreement was a step toward its goal of becoming the global leader in purpose-build vehicle market by 2030. “We will continue to offer diverse PBVs to our customers in logistics and retail, and enhance competitiveness in global PBV business”, Kia said in a statement. +++

+++ The new LEXUS NX is a completely redesigned model, and it’s a significant improvement across the board. But one area in which, fortunately, it didn’t change was crash performance. Just like its predecessor, the new NX has earned the top IIHS accolade: the Top Safety Pick+ award. It even outperformed the SUV it’s based on, the Toyota RAV4. Both the more conventionally powered NX and the plug-in hybrid receive the award, thanks to excellent results in every test IIHS threw at it. It earned the top “Good” rating for all crash tests (although the challenging new IIHS side impact test has not yet been adopted for ratings). The same rating applies to the NX’s headlight performance for all 3 designs offered by the SUV, whereas its RAV4 cousin has some weak performing lights that hurt its overall rating. The forward collision prevention system also received the top “Superior” rating for both vehicle and pedestrian situations, and the Latch child seat anchor access was rated “Good+”. The luxury SUV space the NX competes in features a number of other Top Safety Pick+ recipients. The Audi Q5, Genesis GV70 and Volvo XC60 all get the same high rating. The Mercedes-Benz GLC comes close with the regular Top Safety Pick rating. +++

+++ The MERCEDES CLE has been spied testing before, but now there are new images showing the BMW 4 Series convertible rival isn’t too far away. The midsize convertible is destined to replace softtop variants of the C-Class and E-Class. Autointernationaal understands the new model will be badged CLE; a nameplate the German brand has owned for a while but recently renewed its trademark for. Mercedes has preferred the use of a fabric roof in its convertibles of late and the CLE will adhere to this design. The test car spotted sits on 15-spoke alloys and features a dual exit exhaust system, suggesting it could be the AMG 43 version. At the front, it has a similar headlight design to the latest C-Class and the grilles are also likely to mimic that car’s as well. At the rear, there will be 2 air ducts behind the rear wheels, a common design trait on current Mercedes models. Unlike the C-Class and E-Class, the rear number plate sits on the rear bumper rather than the bootlid. The Mercedes portfolio has reached a high of 50 vehicles in 2020 and brand executives have spoken in the past of a need to reduce complexity, especially with the rollout of the all-electric EQ range. Speaking earlier in the year, Mercedes research and development boss Marcus Schäfer pointed to the brand’s convertible offerings as being “high density”, with the recently axed SLC, C-Class Cabriolet and E-Class Cabriolet all vying for space in a market that isn’t a big money maker. However, Schäfer admitted that from a branding perspective the coupé and cabriolet models are important; for a premium car company such as Mercedes, being in this space lays down an important marker. “We want to focus on these models”, he explained. “They have their niche and their purpose. That’s why we are going to tailor exactly the right vehicle in this segment. There’s more to come on the coupé and cabriolet side in this mid-segment but it’s going to take a little bit more time before we can speak about it”. The CLE is likely to be based on the same MRA-2 platform as the new C-Class and S-Class, rather than the SL’s new AMG-designed architecture. The flexibility of MRA-2 means that four and six-cylinder power is possible, appealing to the CLE’s likely buyer. The latest C-Class is a four-cylinder only affair and much of the CLE line-up will be too. The next C 63 model is anticipated to take on a new high-performance 4-cylinder hybrid engine derived from the M139 2.0-litre turbo engine used in the A 45 superhatch. The larger S-Class, also on the MRA-2 platform, could lend a 3.0-litre turbocharged straight-6 with 48 volt mild hybrid assistance, if Mercedes thinks a 6-cylinder option will be necessary. While the car spied here is a four-seat convertible, Autointernationaal expects there will also be a fixed-roof coupé version of the CLE, though the model line-up is likely to be capped at just 2, with no plans for a new midsize 4-door coupé to sit between the CLA and the CLS. +++

+++ Major Chinese carmakers are racing to explore opportunities in the booming NEW ENERGY VEHICLE (NEV) sector, which is expected to consolidate their head start in the volume car market. Changan Automobile is investing more than 80 billion yuan ($12.55 billion) by the end of 2025, primarily in NEVs, said the Chongqing-based carmaker last week. By then, electric cars and plug-in hybrids are expected to total 1.05 million units, accounting for 35 percent of its sales in the year. Wang Jun, Changan’s president, said the carmaker will launch 8 NEV models this year in the Chinese market. China has been the world’s largest market for NEVs since 2015. Most of the deliveries were from local Chinese carmakers, who started earlier than most of their international rivals in the sector. NEVs (Electric cars and plug-in hybrids) accounted for 41 percent of Chinese carmakers’ sales in March, according to statistics from the China Passenger Car Association. For international brands, including Toyota and Ford, NEVs seized a meager 3 percent in that month in China. In terms of NEVs, the country’s bestselling international carmaker is Volkswagen-yet its NEV deliveries in the first quarter stood at 38.700 units. It was a 67 percent surge from the same period last year, but accounted for less than 40 percent of BYD’s sales in March. In the same month, BYD, backed by Warren Buffett, stopped production of conventional gasoline cars. It is the world’s first carmaker to quit the fossil fuel-powered vehicle segment. Zhang Hong, an official at the China Auto Dealers Association, said BYD’s expertise is mainly in NEVs, and its plug-in models have been in short supply. “So, it’s not surprising for BYD to make the decision to quit the gasoline car business”. China’s largest SUV and pickup truck maker, Great Wall Motors, is electrifying its lineup. It expects vehicles with some form of electrification to account for 80 percent of its deliveries by 2025. Last year, the figure was nearly 11 percent of its total sales. In new overseas markets like Germany, Great Wall Motors is starting with electric cars and plug-in hybrids, instead of conventional gasoline vehicles. Most international marques are starting their electrification campaign in earnest as well. Japanese carmaker Honda said on Tuesday that it will introduce a total of 10 new electric vehicle models by 2027 into China. Globally, Honda aims to launch 30 EV models by 2030. It said the lineup will range from commercial mini-EVs to flagship models. Honda expects its global production to reach 2 million units annually by 2030. In China, it will build dedicated EV plants in Guangzhou, Guangdong province, and Wuhan, Hubei province, where its two joint ventures are based, respectively. GM will deliver the Cadillac Lyriq to Chinese customers in the third quarter of this year. It is the first model based on GM’s EV platform Ultium. The carmaker plans to launch more than 30 EVs worldwide using the Ultium platform by 2025. More than 20 of those will hit the Chinese market. By that time, GM expects to have produced 1 million EVs in China. +++

+++ Just like smartphones or any other tech devices, vehicles also receive software for new versions from their manufacturers via OTA (Over The Air) updates. Software updates are a significant part of the connected car experience because they include the latest feature enhancements, such as autonomous driving, as well as crucial security patches. Tesla has been offering OTA updates to all its cars since 2012. Rivals such as Stellantis, Mercedes-Benz and Volvo have also been quickly penetrating the market, which is expected to grow to be worth $8.2 billion in 2028. IHS Markit data shows that the number of vehicles worldwide equipped with OTA software functions rose to 32 million this year from 1.2 million in 2015. But carmakers in South Korea, including Tesla, are blocked from offering OTA updates due to the Motor Vehicle Management Act, which requires that all vehicles be repaired at designated service centers. Software updates are no exception because the Korean government views them as a kind of vehicle modification that is closely linked to driving safety. But due to resistance from the industry, the government has temporarily allowed carmakers to offer OTA software updates over the past 2 years, with a June deadline on the experiment nearing. In January, Hyundai introduced its first OTA software updates on electric models, starting with the GV60. The updates offered software improvements related to the navigation, heads-up display, brakes, steering wheel, suspension, air bags and advanced driver assistance systems, as well as the digital cockpit. Hyundai announced last week a plan to update its digital key via an OTA update, so drivers just carrying the phone would be able to open the door without even needing to tap the door. The carmaker already unveiled in March that its investment of 12 trillion won ($9.7 billion) over the next three years will be also put to developing OTA updates so all of its 23 models to be launched by 2025 will be offered with OTA update functions. OTA updates not only offer drivers the ability to comfortably have their vehicles updated remotely, but allows carmakers to save expenses because they can simply upload their software updates online. Market figures show that global carmakers will save around $35 billion this year through OTA service. Market insiders viewed that OTA updates have become a new way to increase profitability, as electric vehicles have narrow margins compared to combustion engine models. “Tesla’s stellar profit in 2020 just by selling 500.000 units but achieving market capitalization of $600 billion is based on its sales of a subscription-based OTA service called FSD”, said Koo Seong-joong, a researcher at Kakao Pay Securities. On Wednesday, Tesla CEO Elon Musk said that the company has secured 100.000 customers registered to their full self-driving program, a subscription program to OTA updates to receive advanced driver assistance features at $199 per month. “When Hyundai secures its OTA technology competitiveness and expands it to apply to future models, it can pivot to a subscription-based service for OTA updates as well, allowing more advanced connected car driving experiences such as autonomous driving”, he added. But others have also pointed out that OTA updates need to be addressed with more consideration and verification procedures. “Most global carmakers offer OTA updates, but usually only at an infotainment update level. It’s not necessarily because they lack technology development, but because they are careful about security aspects and chances of hacking”, said an official from Korea Automotive Technology Institute. The Transport Ministry still remains cautious about easing related regulations any time soon, citing no international standard set up amid the ongoing discussions globally. Separate from the government’s lukewarm stance, industry watchers say carmakers will continue to develop their OTA software features that are crucial to the future of connected vehicles and autonomous driving. +++

+++ The RENAULT Group is considering selling part of its Nissan stake, a move that could raise billions of euros for its shift to electric vehicles and ease long-standing tensions with its alliance partner, people familiar with the matter said. Nissan itself may be willing to buy some of the 1.83 billion shares in the Japanese automaker that Renault owns, according to the people, who asked not to be identified because the discussions are not public. Renault may also seek other acquirers for a portion of its 43 percent stake in Nissan, the people said. Spokespeople for Renault and Nissan declined to comment. By paring a stake worth 983.5 billion yen (7.1 billion euros), Renault would be walking a fine line: trying to rebalance a 23-year-old alliance without unraveling it. A lopsided cross-shareholding structure (Nissan owns just 15 percent of Renault and lacks voting rights) has been a pain point for factions of Nissan executives going back years. A sale could help finance major structural changes that Renault CEO Luca de Meo began to sketch out in February. The company is considering a breakup and separate listing of its EV business. Its legacy business could then join forces with a partner. One option would be China’s Zhejiang Geely Holding Group, which controls Volvo Cars, the people said. Renault reached a joint production deal with Geely earlier this year for a South Korean plant, and the 2 have said they may also cooperate in China. A representative for Geely declined to comment. De Meo, 54, was making strides turning Renault around before Russia’s invasion of Ukraine all but forced the company to begin exiting its second-largest market. The pullout will be costly: the automaker said it will take a non-cash charge amounting to the 2.2 billion euro value of its assets in Russia, which include a manufacturing plant in Moscow. It’s also assessing options for its stake in Lada maker AvtoVAZ and may try to transfer ownership to a local investor. Negotiations to reshape the Renault-Nissan alliance (which have not been discussed publicly) could take many months, the people said. Renault’s EV carve-out could include Nissan assets, the people said. Nissan also would be a partner in the French automaker’s legacy hybrid and combustion-engine operations, they said. The 2 companies are working with one another on Renault’s structural overhaul, chief financial officer Thierry Pieton told analysts Friday. “Nissan is in the loop”, Pieton said. “This is obviously something that we want to discuss with them”. Nissan would be in a better position than a year ago to buy back its shares, should Renault decide to sell. The Yokohama, Japan-based company has 2 trillion yen ($15.6 billion) in cash and equivalents on hand, and fiscal year operating profit is on track to be positive for the first time since 2019. Ashwani Gupta, Nissan’s chief operating officer and a former Renault Group executive, will travel to Paris next week for discussions with de Meo ahead of a broader meeting between Renault and Nissan’s executives in Tokyo next month. Tension surrounding the asymmetrical nature of the companies’ ties almost destroyed the alliance following the 2018 arrest in Japan of former chairman Carlos Ghosn. The automakers have since been focused on separate turnaround plans to get them past damage wrought by Ghosn’s ouster and the pandemic. Negotiations aimed at rebalancing the Franco-Japanese alliance, which also includes Mitsubishi, were held in 2019 but took a back seat to more urgent operational and management issues. They have been kept off the table until now. Reducing Renault’s stake to 15 percent, the same level as Nissan’s ownership of Renault, could yield about 4.65 billion euros at current sahre prices. It’s unlikely that Renault would sell the entire holding, as that would weaken the alliance. The operating agreement governing the partnership, known as RAMA, may also have to be amended with a change in shareholding, some of the people said. The accord has long been a source of friction between the partners, as has the French government’s 15 percent holding in Renault, which comes with double voting rights. The alliance outlined plans in January to strengthen operational ties and invest in electrification, potentially complicating any separation of Renault and Nissan’s EV businesses. Renault chairman Jean-Dominique Senard said then the companies’ closer links would be “totally unbreakable”. +++

+++ SAIC-General Motors-Wuling ( SGMW ), based in Liuzhou of South China’s Guangxi Zhuang autonomous region, reported strong new energy vehicle (NEV) sales in the first quarter of this year, said the company. SGMW, a joint venture between SAIC Motor, General Motors and Liuzhou Wuling Motors, registered NEV sales of 117.210 units in the January-March period; up 16 percent year-on-year. SGMW now produces NEV models including the Hongguang Mini EV, the Baojun KiWi EV, and the Wuling Nano EV. The Hongguang Mini EV achieved robust sales of 106,721 units during the period, up 9.4 percent year-on-year. Monthly sales of the Baojun KiWi EV hit a record in March, reaching 3.385 units. +++

+++ A takeover battle for SSANGYONG , the debt-ridden carmaker owned by India’s Mahindra Group, has kicked off between 3 rival bidders: 2 medium-sized enterprises and a private equity firm. KG Group, Ssangbangwool and Pavilion PE each submitted a letter of intent to acquire SsangYong to the lead manager of the deal, EY Hanyoung, industry sources said. After South Korean electric carmaker Edison Motors’ deal to purchase SsangYong Motor went up in smoke, Seoul Bankruptcy Court approved on April 14 for a new auction to take place. The EV bus maker failed to meet the deadline to make the full payment for the proposed takeover. As SsangYong faces a tight rehabilitation plan deadline on October 15, the carmaker will be adopting a “stalking horse bid”, according to market observers. It refers to a process in which a bankrupt company seeks a new buyer from a pool of bidders while already having an initial bidder in order to maximize the value of its assets. The new auction is scheduled to begin in May and SsangYong Motor aims to select a preferred bidder at the end of June. Market insiders see the chemical-to-financial conglomerate KG Group as the most feasible candidate to take over SsangYong, considering its stable cash flow, funding capability as well as know-how in managing a diverse business portfolio. KG Group has been seeking to draw up a consortium for the bid with private equity Cactus PE, which it previously partnered up with when it acquired Dongbu Steel in 2019. Ssangbangwool, a local innerwear maker, meanwhile, has secured 450 billion won ($364 million) in cash that would be used for a “stable financing route” to acquire SsangYong. It is reportedly forming a consortium with local construction company KH Group. South Korea-based Pavilion PE, making a second bid for acquiring the carmaker, is looking to form a consortium with financial institutions and conglomerates, according to reports. It is the second bid for Pavilion PE. In a consortium with electric vehicle company EL B&T, Pavilion participated in the bid to acquire the SUV maker but lost against the Edison Motors-led consortium. +++

+++ TESLA is looking to produce 1.5 million vehicles and over 50 percent growth over 2021 numbers, as the Shanghai factory has resumed production “at fairly high levels” following a month-long Covid-related closure. Admitting the automaker has lost “a lot of important days” for build volume out of Shanghai, CEO Elon Musk predicted Q2 production to be roughly on par with the first 3 months. “Giga Shanghai is coming back with a vengeance”, he told analysts during a call on Wednesday following the release of its first quarter earnings. “I think we will see record output per week from Giga Shanghai this quarter, albeit missing a couple of weeks”. He added production has also begun to resume among Tesla’s suppliers, and predicted a substantially higher output for Q3 and Q4. “So, it seems likely that we’ll be able to produce over 1.5 million cars this year; that’s my best guess”, he added. He also said the automaker’s new plants in Berlin and Austin are likely to see faster ramps because of experience from Shanghai and simplification of the production process for the Model Y. Tesla reported 310,048 vehicle deliveries for the first quarter. It reported $18.76 billion in revenue and $3.22 earnings per share in the quarter, beating market expectations. +++

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