+++ The new ABARTH 500 EV is due to be unveiled in the coming weeks, but leaked images posted to Instagram look to provide an early glimpse of its more aggressive styling. It appears the Mini Electric rival will be distinguished from the regular Fiat 500 by a revised front end with more prominent air dams and a flat upper fascia. A neon green paint job with side striping, plus low-profile turbine-style alloy wheels help to further mark it out from the regular supermini. Spy shots of a camouflaged test car, which surfaced last week, also revealed a chunky rear spoiler. The car, officially being revealed on 22 November, will mark the beginning of Abarth’s transition into an electrified go-faster sub-division of Fiat. Other models will receive the treatment on a case-by-case basis. Brand boss Olivier François told earlier this year that he expects to have between 1 and 3 Abarth models at any one time. François said at the time: “A year and a half ago, I said it can’t be that hard to make an Abarth version of the electric 500. Electric cars are so fun to drive already. The good news is that we are actively working on it, and once it’s confirmed, it will be relatively quick. “The bad news is that it’s more complicated to deliver than I thought. If you want to do a real Abarth, it’s not the same electric powertrain. Once it has the power and torque you want, it’s no longer the same drivetrain, nor the same transmission or brakes. The whole thing has to be adapted”. He added that final test drives were under way ahead of official confirmation of the car: “It’s going to be fantastic. The sound is going to be very interesting. There will be a choice to be silent or not”. The Abarth fan community will play a crucial role in shaping the development of upcoming models, said François: “When it comes to marketing, it’s a totally different brand to Fiat. These Abarth fans would not buy a Fiat, and vice versa. It’s basically 1 car (the 500) and 2 totally different targets. We are going to leverage the community, involve them in the development. Social media is ideal for that”. The electric Fiat 500 has a 0-100 kph time of 9.0 seconds, a top speed of 150 kph and a range of 320 km. The upcoming Abarth version is likely to aim for that sprint in under 7.0 seconds with a top speed over 160 kph, but at the cost of some range. +++
+++ BMW will not leave the lower-priced segments it competes in during its transition to electrification. While speaking during a recent event in Berlin organized by supplier Robert Bosch, BMW chief executive Oliver Zipse noted that the lower-priced segment will prove important to the car manufacturer moving forward. “We are not leaving the lower market segment”, he said. “Even if you consider yourself a premium manufacturer, it is wrong to leave the lower market segment. That will be the core of your business in the future”. BMW’s stance differs dramatically from that of rival Mercedes-Benz. In May, Mercedes-Benz revealed that it will drop its entry-level models and instead focus future investments on higher-end vehicles that generate greater profits. “We are further sharpening the focus of our business model and product portfolio in order to maximize the potential of Mercedes-Benz even in challenging conditions”, Mercedes-Benz Group chairman and chief executive Ola Källenius said at the time. The automaker has confirmed it will cut its number of entry-level models from 7 to 4 and is looking to pursue growth in the AMG, Maybach, EQ, and G-Class brands. This strategy also prompted the creation of the Mythos series that will be dedicated to producing highly-exclusive vehicles. No less than 75 percent of future investments will be used to develop new luxury models. “Most luxury companies build their portfolio on the basis of 1 or 2 true icons”, Kallenius added. “Mercedes-Benz has the good fortune to have multiple iconic products and brands at the upper end of its portfolio, such as the S-Class, the SL, the G as well as the AMG and Maybach brands. We see great potential here to expand our ‘top-end’ portfolio with even more fascinating products for our customers”. +++
+++ CAR VALUES are all over the map right now. Used vehicles that were worth a small fortune earlier this year are now coming back to Earth, but the new vehicle supply remains tight. Prices are still elevated overall, but some models have seen more severe price drops. Depreciation strikes almost every model, supply constraint or not, though a few vehicles are leading the way. New research from analytics iSeeCars found that a handful of cars depreciated in the United States more than 50 percent over 5 years, with the BMW 7 Series dropping 56.9 percent and an average price cut of $61,923 over that time. Other vehicles with a high depreciation (or bad resale value) over 5 years were: Maserati Ghibli: -56.3%, Jaguar XF: -54%, Infiniti QX80: -52.6%, Cadillac Escalade ESV: 52.3%, Mercedes-Benz S-Class: 51.9%, Lincoln Navigator: -51.9%, Audi A6: -51.5%, Volvo S90: -51.4% and Ford Expedition: -50.7%. iSeeCars’ research showed that midsize pick-ups, sports cars, and fuel-efficient vehicles were slowest to depreciate over 5 years, while it’s clear that luxury brands tend to lose value much faster. As iSeeCars’ Executive Analyst Karl Brauer explained, used buyers don’t value high-end vehicles’ features as much as the first owners, so resale values tend to be softer. The tech and options that made the cars so expensive and appealing new don’t add the same value on the used market. Interestingly, electric vehicles also depreciated quite heavily, though they were just short of the abysmal numbers in luxury segments. The Nissan Leaf depreciated most among EVs, dropping by 49.1 percent. The average EV depreciation is 44.2 percent, with the Tesla Model S and Model X sliding in right under the bar at 43.7 and 38.8 percent, respectively. As iSeeCars notes, it’s important to be vigilant when car shopping and not let your emotions win over reason. Shiny new luxury cars look great in the showroom, but you could end up taking a bath when you try selling them a few years later on. +++
+++ Rivian, Lucid and Canoo all reported third-quarter earnings this week, and the results make clear that the ELECTRIC VEHICLE STARTUPS are still scrambling to fulfill large delivery backlogs, even as production ramps up. At the same time, the would-be “next Teslas” are still grappling with the challenges of ramping up manufacturing as their stock prices decline. Rivian and Lucid each made progress toward their production goals for the year and steadily increased customer deliveries. But both saw the gap between production and deliveries widen in the quarter. Canoo has yet to make any production vehicles. “The reality is, we’ve seen the continuation of how challenging this can be”, Pavel Molchanov, a Raymond James analyst, told. I gathered insights from Molchanov and 3 other auto experts about the third-quarter earnings and what they anticipated from these firms for the final months of what has been a difficult 2022. Here are their key takeaways: 1) Rivian reports more progress. Rivian produced 7.363 vehicles and delivered 6.584 in the third quarter, with a total of 14.317 built and 12.278 delivered since the start of the year. After it closed the gap in the second quarter, Rivian’s pace of deliveries again fell behind production by 779 vehicles. Claire McDonough, its chief financial officer, attributed this backlog to setbacks related to ramping up a second shift at the company’s Normal, Illinois factory and aligning a new production schedule with changes to delivery logistics and a slower holiday period. She expects the gap to close again early next year. “What we don’t deliver in Q4 rolls into the upcoming quarter, so you start to normalize over time as we ramp closer to the installed capacity”, McDonough told investors on the Q3 call. CEO RJ Scaringe told investors the addition of a second production shift in Normal should push Rivian toward its 25.000 vehicle goal by year’s end, but warned of challenges as the company ramps up production. “While the ramp curve is much faster than what we went through on the first shift”, Scaringe said, “it’s not as if it starts immediately at 100% output”. Experts saw Wednesday’s results as a sign that Rivian continues to make progress toward meeting its target of 25,000 vehicles this year. “We are cautiously optimistic that many of the headaches in the Rivian story are starting to be in the rear view mirror”, Wedbush analyst Dan Ives said in a note following earnings. One damper for experts was Rivian’s pushing the smaller, more inexpensive R2 platform launch from 2025 to 2026. “The company’s more material volume improvement will now not come until after 2025”, Deutsche Bank analyst Emmanuel Rosner wrote in a recent note. “While this may come as unwelcomed news, we believe the company is making the change to ensure appropriate time to go through the ramp-up phase”. 2) Lucid’s racing to the end of the year. Lucid reported it produced 2.282 cars in the quarter and delivered 1.398 to customers, with revenue of $195.5 million. In the first 3 quarters, it built 3.687 vehicles and delivered 2.437. This quarter signaled Lucid is getting closer to its current target of between 6.000 and 7.000 vehicles, about a third of what it planned to make going into 2022. Lucid had 34.000 reservations at the close of Q3, down from 37.000 in Q2. It also had $3.85 billion in cash on hand (down from $4.6 billion the previous quarter), and saw a net loss of $670.2 million. Though Lucid said it had enough cash to last another year, it announced plans to raise $1.5 billion. Lucid underwent some changes in Q3 following a rough second-quarter. Several operations-related leaders left the company. “We brought our logistics operations in-house”, CEO Peter Rawlinson said in a Q3 call. “We brought in exceptional leadership. We’ve addressed some of the gating factors impacting Q2 production”. Ali Faghri, managing director of automotive research at Guggenheim Securities, told that the progress is promising, but investors still have questions about Lucid’s ability to scale. “The fact that reservations are already declining before Lucid has even gotten to higher levels of deliveries will probably lead to more concerns from investors”, Faghri said. 3) Canoo’s got another new plan. Canoo reported it had yet to build any vehicles as of the end of the third quarter, and that it had $6.8 million in cash with access to $200 million through an at-the-market offering. It also saw a $117.7 million net loss. During a third quarter call, CEO Tony Aquila revealed his company’s new manufacturing plan, the latest of several he’s touted over the past year. First, Canoo was set to rely on partner VDL Nedcar for production. Then, it planned to build its own cars at its plant in Bentonville, Arkansas this year, and at its second factory in Pryor, Oklahoma in 2023. Now, Canoo says it is working with partners to start production on November 17. It announced it is buying an existing plant in Oklahoma, where it will ramp up production in the second half of next year. The Pryor location will come into play later. In the months since Canoo landed its deals with NASA and Walmart, the company signed binding agreements with fleet leasing provider Zeeba for 3,000 EVs and from work van rental company Kingbee for 9,300. “We’re taking a disciplined phased expansion approach to bringing on capacity based on committed orders”, Aquila told investors. “This is now proving to be a very good move for us since the economy is now more turbulent and it’s more difficult to sell vehicles one at a time”. +++
+++ The MERCEDES-AMG One has set a new fastest lap for production cars at the Nürburgring, eclipsing the previous record by almost 10 seconds. The 1.060 hp hypercar posted a time of 6 minutes 35.183 seconds around the 156-corner circuit, driven by Mercedes DTM driver Maro Engel on 28 October. This lap time also took the record for the super-sports car category. Dubbed a Formula 1 car for the road, the €3 million hypercar is the most potent Mercedes-AMG road car ever made, combining a modified version of the firm’s turbocharged 1.6-litre V6 grand prix engine with 4 electric motors. The previous production car lap record was held by the Porsche 911 GT2 RS Manthey-Racing with a time of 6 minutes 43.3 seconds. The outright Nürburgring Nordschleife lap record remains with the all-electric, one-off Volkswagen ID.R (6 minutes 5.336 seconds). “That was really an unforgettable experience”, said Engel, who took the record on a damp and dirty track. “I didn’t expect that we would be able to set such a lap time with these track conditions. In some crucial areas of the track, it hadn’t dried completely yet and was therefore tricky. That was a special challenge”. Engel added: “Like Lewis Hamilton and George Russell on their race weekends, I also had to deploy the electrical energy of the hybrid drive in the best possible way. That’s not easy, especially with this length of track. But that’s also a real Formula 1 feeling”. Mercedes confirmed that the car used to take the record was the same “standard” spec as the 275 cars being delivered to owners. Mercedes‑AMG chairman Philipp Schiemer said: “I’m proud of the whole AMG team: everyone who was involved in this project. We’re the first ever to have taken on the challenges of the Nürburgring with a super-sports car. That’s also what makes this project so unique and I’m very happy about this fantastic lap time”. The car is the result of a close collaboration between Mercedes-AMG’s regular road car operation and the UK-based Mercedes-AMG F1 team and AMG High Performance Powertrains division. It is available in 2-seat, left-hand-drive guise only. +++
+++ MERCEDES-BENZ chief executive Ola Källenius says China is far too important for the automotive industry for the country to be shunned. While speaking at the ESMT business school in Berlin, Germany earlier this week, Källenius said he was deeply convinced of the benefits of globalization and that it would be “absolutely inconceivable” to write off the country. Källenius made these comments shortly after German chancellor Olaf Scholz headed a delegation of business leaders to China. Scholz warned German businesses to diversify should the country’s relationship with China sour after President Xi Jinping extended his term as leader. “To back away from China because something might happen would be the wrong direction”, Källenius said. It comes as no surprise that the boss of Mercedes-Benz understands and appreciates the importance of the Chinese market to the German automaker. As a matter of fact, third-quarter sales results revealed that of the 520.100 vehicles delivered by Mercedes-Benz in the third quarter of 2022, some 206.800 were sold in China. China has become such a big market for Mercedes-Benz that it easily outsold Europe during Q3 where 152.700 vehicles were delivered and North America where 83.200 units were sold. Sales in China jumped 37 percent in Q3 from the 150.600 units sold during the same quarter last year but interestingly, Chinese sales were down 5 percent from the first 9 months of 2021 to 562.600 units. Sales of Mercedes-Benz models in China have been strong for quite some time, so much so that it sold 774.000 vehicles in the nation in 2020, despite the Covid-19 pandemic. +++
+++ President Joe Biden said Elon MUSK ’s relationships with other countries are “worthy of being looked at”, though he declined to say whether the world’s richest man was doing anything inappropriate. “I think that Elon Musk’s cooperation and or technical relationships with other countries is worthy of being looked at”, Biden said at a White House news conference Wednesday. “Whether or not he’s doing anything inappropriate: I’m not suggesting that. I’m suggesting they’re worth being looked at. But that’s all I’ll say”. Last month, people familiar with the matter said the Biden administration was discussing whether the US should subject some of Musk’s ventures to national security reviews, including his deal for Twitter and SpaceX’s Starlink satellite network. 1 element of the $44 billion Twitter deal was the presence of foreign investors in Musk’s consortium. The group includes Prince Alwaleed bin Talal of Saudi Arabia, Binance Holdings (a digital-asset exchange founded and run by a Chinese native) and Qatar’s sovereign wealth fund. Musk’s Tesla electric-vehicle company derives about 25% of its revenue from China. Musk, who once called Biden a damp sock puppet “in human form” has frustrated officials in the US and Europe and drawn praise from America’s rivals for tweets to announce proposals to end Russia’s war in Ukraine and threaten to cut financial support for Starlink internet service in Ukraine. On Monday, a day before the midterm elections, Musk urged Americans to vote for Republicans, arguing that “shared power curbs the worst excesses of both parties”. Once he acquired Twitter late last month, Musk embarked on a flurry of changes. After unseating top management and the board, he laid off roughly half the company’s workers, though some employees were asked to come back. +++
+++ RIVIAN missed Wall Street estimates for third-quarter revenue, but shares rose after hours as the electric-vehicle maker reported a smaller-than-expected loss and a higher number of preorders, and reaffirmed its full-year production outlook. The company, which went public a year ago, also said its smaller R2 vehicle family will begin production in 2026, a year later than previously announced, at Rivian’s planned $5 billion Georgia plant. The automaker ended the third quarter with $13.8 billion in cash, down from $14.9 billion at the end of the second quarter. “We remain confident in our ability to fund operations with cash on hand through 2025”, Rivian said in an SEC filing late on Wednesday. Shares were volatile in after-market trading, rising as much as 7% after falling nearly 12% in the regular session. In September, Rivian and Mercedes Benz said they are planning a joint venture to produce electric vans in a factory in Eastern Europe within the next few years. Rivian also has a contract to supply 100.000 electric delivery vans to its biggest investor, Amazon.com. The news has not been so good for Rivian’s rivals. British electric van start-up Arrival warned investors on Tuesday that it did not have enough cash to assure its survival through 2023. Lucid Motors on Tuesday reported a $670 million loss for the third quarter and said its order bank had dropped since the second quarter. Shares of Tesla, Rivian’s chief competitor, sank 7% to their lowest point in two years after CEO Elon Musk sold nearly $4 billion worth of Tesla stock following his purchase of Twitter. “While we think Rivian’s balance sheet is in better shape than most other upstart EV manufacturers from a liquidity standpoint, the company is far from reaching the scale needed to drive down its unit costs and move closer to profitability”, CFRA Research analyst Garrett Nelson said on Wednesday. CFRA estimates Rivian’s cost of goods sold at about $220.000 per vehicle versus an average selling price of $81.000 in the quarter. As they have for other EV makers, supply-chain disruptions have pressured Rivian, forcing the company earlier this year to cut its production forecast by half to 25.000 vehicles. In the third quarter that ended on September 30, the electric-vehicle maker delivered 7.363 vehicles, up from 4.467 units in the prior quarter. Production through 9 months is about 14.000. Rivian said it was adding a second shift at its Illinois plant. Quarterly revenue was $536 million, compared with analysts’ expectations of $551.6 million, according to Refinitiv data. The company’s quarterly net loss widened to $1.72 billion compared with a $1.23 billion loss a year earlier. Adjusted loss per share of $1.57 beat analysts’ expectations of an adjusted per-share loss of $1.82. Capital expenses in the quarter fell to $298 million, from $467 million a year earlier, as the company continues to conserve cash and push some spending back into 2023. Rivian lowered its full-year capex forecast to $1.75 billion, from its previous estimate of $2 billion. +++