+++ BMW and Mini are set to shift towards an agency distribution model throughout Europe, following the lead of Mercedes-Benz and Audi in moving to a direct sales program. BMW Group’s sales and marketing boss Pieter Nota confirmed the brand is speaking with European dealerships about the switch to the agency model. This confirmation comes a couple of months after insiders claimed that BMW would end its dealer system in Europe from 2024 for the Mini brand and 2026 for the BMW brand itself. Nota said the timing of the move has yet to be confirmed. Under the agency model, BMW would hold the inventory and invoice customers directly. Dealerships would then be tasked with delivering new vehicles and receive a fixed fee per vehicle sold. While dealers would make less money for vehicles through this model, BMW says they will reduce costs by not having to maintain an inventory and by slashing promotional expenses. Premium car manufacturers throughout Europe often offer dealer margins of 12 to 16 per cent. Sales commissions through the agency model will be roughly halved. BMW had launched an agency model when the i subbrand was first introduced. It later abandoned this model but re-introduced it across its entire range in South Africa in 2020. Nota says the agency model will only be used in Europe and not in China or the U.S. where many states prohibit car manufacturers from selling directly to consumers. It’s not just BMW, Mercedes-Benz, and Audi that are moving towards a sales model of this kind. Stellantis will follow suit in mid-2023 with its Alfa Romeo, DS, Lancia, Citroen, Fiat Professional, Opel / Vauxhall and Peugeot brands. The Volkswagen Group also sells its ID-branded EVs through an agency model. +++
+++ The American business unit of FIAT CHRYSLER AUTOMOBILES (FCA) has agreed to plead guilty to criminal conduct and pay roughly $300 million in penalties to resolve a multi-year emissions fraud probe surrounding vehicles with diesel engines, people familiar with the matter said. FCA, now part of Stellantis, has agreed to plead guilty to a criminal conspiracy charge arising from its efforts to evade emissions requirements for more than 100.000 older Ram pickups and Jeep SUVs in its U.S. lineup, the people said. The plea deal, negotiated with U.S. Justice Department officials, is set to be unveiled as soon as next week, though the timing could slip. The company would then enter its guilty plea during a subsequent hearing in a U.S. district court. The affected diesel-powered vehicles span model years 2014 to 2016. FCA merged with Peugeot SA in 2021 to form Stellantis. The plea deal comes 5 years after Volkswagen pleaded guilty to criminal charges to resolve its own emissions crisis affecting nearly 600.000 vehicles in a scandal that became known as ‘Dieselgate’. Volkswagen’s deception precipitated additional scrutiny that resulted in officials on both sides of the Atlantic cracking down on automakers accused of using illegal software known as defeat devices to dupe government emissions tests. European automakers relied on so-called clean diesel technology to make vehicles that could comply with tougher environmental regulations only for officials to find they were polluting more on the road than during the tests that certified them for sale. Automakers are now focusing efforts on battery-powered electric vehicles. Negotiations between FCA lawyers and U.S. officials to resolve the current probe dragged on for years and across presidential administrations as the two sides haggled over whether the company would plead guilty and, if it did, the exact details in any criminal charge, one of the people said. One of FCA’s employees is preparing to face trial on charges he misled regulators about pollution from the vehicles targeted in the investigation. Last year, the Justice Department disclosed charges against two additional FCA employees in the alleged emissions fraud. An indictment alleges the employees conspired to install defeat devices in vehicles so they could dupe government emissions tests and then pollute beyond legal limits on roadways. FCA has previously resolved related civil allegations while denying it deliberately attempted to cheat on emissions tests. +++
+++ FORD is targeting zero emissions for all of its vehicles in Europe by 2035, and it’s likely that its North American lineup will follow suit. However, it seems like the carmaker will still be embracing ICE powertrains for some time, at least indirectly. CEO Jim Farley said at the brand’s 2022 shareholder’s meeting that it has every intention of making hybrid vehicles right up until 2035. “Well, first of all, hybrid has been and will remain a very important piece of our lineup at Ford and we have the strongest hybrid lineup ever”, Farley said. “We sold nearly 88.000 hybrid vehicles in the U.S. alone last year, and we’ve already sold 36.000 just through April. This is really exciting for us to see the growth of not just our fully electric vehicles, but our successful expansion of PHEVs in Europe and China, and the HEVs, especially here in North America, like the very popular F-150 hybrid. This is a big change for us, but as far as hybrids and plug-ins, we’ve never been more committed and we continue to see our sales accelerate because of our investment in this technology”. The F-150 PowerBoost hybrid was all-new for 2021 and was instrumental in making last year Ford’s best ever for hybrid sales. In addition to the full-sized hybrid truck, Ford’s new compact Maverick hybrid is also experiencing a massive surge of popularity, so much so that the blue oval has had to stop accepting orders for the 2022 model year due to production limits. For Europeans, the Kuga PHEV is an extremely popular option. Ford has had a lot of success in the hybrid sector, with many of its vehicles far exceeding sales expectations. As a result, Ford will hybrid-ify a number of its upcoming vehicles, such as the Bronco Sport, Ranger and even the Mustang. +++
+++ LUCID MOTORS announced in May that it is recalling most of the Air sedans it has built since the new EV went into production in order to address a potential problem with their in-cabin display wiring harnesses. There may not be adequate clearance between the harnesses and steering column components, which can result in rubbing and potential chafing of the wiring harnesses. Over time, this could cause the harnesses to fail, rendering the Air’s primary screens ( including the speedometer and other cluster displays) inoperable. The recall applies to all Lucid Air models built up until May 3 (just 1.117 vehicles) and Lucid says the issue can result in intermittent display failures or flickering. The cars in question are so new that it’s unlikely that any customers will have to deal with the problem before having their cars repaired. “Lucid has determined that on certain 2022 Lucid Air models the harness containing the ethernet wiring for the center and left driver displays may not be secured properly,” Lucid’s defect notice said. “This could result in chafing of the harness due to contact with the steering intermediate shaft. Damage to the harness could lead to a potential loss of data communications to the displays. Loss of communication at these screens could interrupt updating of the speedometer, gear selection indicators, telltales and other in-vehicle notifications, resulting in noncompliance”. Lucid says the issue stemmed from slack in some batches of harnesses that was not adequately secured. The issue was fixed in production as of May 4, so any vehicle built after that date should be good to go. The company says it has not received any reports of display failures in the field and given how few Airs Lucid has sold, we expect that will remain the case. This is Lucid’s second recall for the 2022 Air sedan; the previous recall was for an improperly installed rear suspension component. +++
+++ HYUNDAI today laid out how it expects to become a mobility leader in the U.S. with a plan it says will cost it more than $10 billion. The automaker intends to invest in EVs, autonomous technology, robotics, and air travel in order to secure its future growth. The plan’s biggest component is a $5.54 billion plant that will become the first dedicated EV battery manufacturing facility in the state of Georgia. At it, the Hyundai Motor Group will build more than 300.000 units per year, starting in 2025. In addition, Hyundai says it has also allocated money for other investments in areas that are important to its future success. These strategic investments will allow it to offer diverse mobility products and services for greater safety and convenience. The growth of Boston Dynamics will be a key element of its plan as it hopes to expedite the mass production of future products. That will allow it to enhance its lineup of robotic products and offer a range of mobility solutions based on the wholly-owned company’s technology. The Hyundai Motor Group has also said that it will invest further in the field of autonomous driving. It has already established Motional, a joint venture created with Aptiv that is testing robotaxis on U.S. roads. The automaker says, though, that will cooperate with other American partners to accelerate its efforts to bring driverless technology to the public. It is also seeking more U.S. partners in the field of artificial intelligence in order to strengthen its competitiveness. With more money dedicated to AI, it hopes to broaden its business infrastructure, achieve carbon neutrality, and apply the technology throughout its business. Finally, it will also continue to work on making advanced air mobility a reality. With its company Supernal, the Hyundai Motor Group aims to make autonomous passenger drones practical in the near future. It is also working on an app that will plan an entire route for you, getting you to a vertiport and to your final destination. “We have come a long way and become very successful in a short period of time, but we are also preparing for our future”, said Euisun Chung, executive chairman of the Hyundai Motor Group, following his meeting with U.S. president Joe Biden in Seoul. “The Group will strengthen our partnership with U.S. public and private entities to offer innovative products and mobility solutions to our valued customers in the U.S. while supporting global carbon neutrality efforts”. +++
+++ It looks like the Hyundai Motor Group is having a spring clearance and all sedans must go. Following reports that the Hyundai Sonata is living on borrowed time, it is suggested the Kia K5 (Optima) will meet a similar fate. While nothing is official, an analyst believes the Sonata will be given one more facelift before getting axed in 2027 or 2028. However, Hyundai is downplaying rumors of the car’s demise as they finally responded to our original request for comment by stating the “Sonata remains and will continue to be an important part of Hyundai’s product lineup. Any rumors on its future are pure speculation”. That’s not exactly a denial and it would be surprising if the automaker confirmed the model was being killed 5 or 6 years before its eventual demise. However, Hyundai is focused on electrification and the company has already confirmed the upcoming Ioniq 6 will be roughly the same size as the Sonata so it could potentially serve as its replacement. We’ll likely have to wait a few years before finding out the fate of the Sonata and K5, but it appears the grim reaper is finally set to claim the KIA STINGER . The model’s death has been widely rumored, but an insider told that production will end after this quarter. That being said, a spokesperson told the “Stinger remains an important part of Kia’s award-winning lineup of vehicles and a powerful piece of our overall brand transformation”, Looking at the sales chart isn’t too enlightening as the K5 launched in the midst of the coronavirus pandemic and only has one full year of sales under its belt. That being said, the company sold 92.326 units in the United States last year and moved 23.376 units through the first 4 months of 2022. Those numbers aren’t terrible as the Optima generated 96.623 sales in 2019 and 101.603 sales in 2018. However, all of those numbers are a significant decline from the 150.000 units that were sold annually between 2012 and 2015. The Stinger, on the other hand, is a premium product with more modest volumes. Sales peaked shortly after launch, in 2018, when the company sold 16.806 units in America. They’ve been hovering around 13.000 units since then and the company has already moved 4.002 units in the first four months of the year. +++
+++ MASERATI will launch its forthcoming MC20 Folgore all-electric supercar as a convertible first, according to the firm’s Vehicle Line Executive Federico Landini. He told that “The BEV will come first as Cielo (a convertible). We are working on the coupe, but the Cielo fits with the BEV, the sky, the feeling, the performance, it really is like a full coupe with the roof up”. When it launched the MC20 in 2020, Maserati showed a chassis buck with the Folgore electric version’s battery packaged behind the monocoque where the ICE model’s 3.0-litre twin-turbo ‘Nettuno’ V6 engine would usually sit. While Landini didn’t comment on the size of the battery or the car’s intended range, he did confirm that the MC20 Folgore will use the same tri-motor powertrain as the brand’s forthcoming GranTurismo Folgore EV. The firm’s head of product planning, Francesco Tonon has previously outlined that the GranTurismo Folgore will feature “way more than 1.200 hp installed power”, so while the MC20 Folgore will likely be significantly heavier than its combustion-engined counterparts, it will also likely offer the strongest straight-line performance of any MC20 variant. Tonon has previously stated that a 0-100 kph time of less than 3.0 seconds will be possible for the GranTurismo Folgore, so the lighter all-electric MC20 should be even quicker still, rivalling cars such as the Lotus Evija. Landini pointed out that like the MC20 Cielo’s carbon fibre monocoque compared with the coupe, while the Folgore model’s chassis dimensions will be identical the types of carbon fibres used in its construction and how they are laid up will change again to account for the specific requirement of an all-electric model. So too will the car’s front and rear subframes. Maserati’s Grecale Folgore compact electric SUV will launch next year, followed by EV versions of the all-new GranTurismo and GranCabrio models in 2023 also. The MC20 Folgore supercar is set to make its debut by 2025, along with Folgore variants of the firm’s next-generation Quattroporte and Levante. +++
+++RENAULT has received several partnership proposals for the combustion engine unit it plans to create alongside one dedicated to electric vehicles and software, 2 sources familiar with the matter said. Renault plans to separate its electric and conventional car businesses, creating 2 entities to manage the shift towards fossil-free vehicles. “The group has already received partnership demands” for its internal combustion engine unit, one of the sources said. By bringing in partners on the combustion engine side Renault aims to free up funds to invest in electric vehicles, a technology in which it was a pioneer with Nissan and Mitsubishi, but in which it is now eclipsed by pure players such as Tesla. Renault intends to retain majority ownership of its electric division, which will employ about 10.000 people and which could be bourse-listed via an IPO in the second half of 2023. However, it will only remain a reference shareholder, not a controlling shareholder, of the combustion engine unit, which will have similar staff levels, said 2 other sources familiar with the plans. 1 of the sources said Renault may hang on to a 40% stake. Renault declined to comment. The carmaker at a capital market day this autumn will set out its plans for its electric arm based in France and the combustion unit headquartered abroad. That entity will include factories producing engines and gear boxes for gasoline and hybrid cars in Spain, Portugal, Turkey, Romania and Latin America. Among potential partners for its combustion engine business, CEO Luca de Meo in April mentioned Nissan, other automotive groups and long-term investors. De Meo is set to travel to Japan next month to discuss potential Japanese participation in its electric and combustion engine projects. Renault is undergoing a major restructuring aimed at restoring its finances and recently signed partnerships beyond its historical alliances with Nissan, Mitsubishi and Mercedes, such as with China’s Geely Automobile Holdings. This month it sold 34% of its South Korean unit to Geely, which owns Volvo Cars and is a shareholder in Mercedes. With Geely, Renault plans to develop hybrid vehicles which will be assembled in its plant in Busan, South Korea. +++