+++ AUDI has already announced it will only introduce electric vehicles from 2026 and phase out models powered by combustion engines by 2033. Reaffirming its commitment to EVs, the Four Rings are planning to build zero-emission vehicles at all factories by 2029. It’s already happening at the Böllinger Höfe and Brussels sites, with Ingolstadt to follow next year when the Q6 e-Tron will begin to roll off the assembly line. Within the next 6 years, EV production will commence at the Neckarsulm, San José Chiapa (Mexico) and Győr (Hungary) plants. Audi says it’ll build new factories only in regions where additional production capacity is needed. To that end, a new manufacturing site is being built with partner FAW in Changchun (China) for PPE-based electric vehicles. Construction will be finalised by late 2024. At the same time, Audi will invest approximately €500 million by the middle of this decade to train its employees for EV production around the world. The luxury brand part of the Volkswagen Group has set an ambitious target to cut annual factory costs in half by 2033. Achieving this goal will be possible by reducing complexity with more EVs and fewer ICEs. A streamlined production process will be implemented right from the start. The Q6 e-Tron will be assembled on the same assembly line as the A4 and A5, with electric cars to gradually replace combustion-engined models in the coming years. Lest we forget Audi has already signalled the demise of 2 conventionally powered cars by revealing it doesn’t intend to renew the A1 and Q2 after the current-generation models run their course. In addition, the V10-powered R8 supercar is going away while the more affordable TT sports car is also on its deathbed. The flagship A8 is likely to transform into a flagship EV later this decade, with future electric cars to be moulded after Audi’s Sphere concepts. The next one, dubbed Activesphere, will premiere on January 26. +++
+++ BMW celebrates the 2 millionth 7 Series model produced at the company’s Dingolfing plant in Germany. The jubilee car is a black i7 xDrive60 with a cognac-painted interior made of a vegan leather alternative. The new generation 7 Series in combustion and electric forms has been on sale since the beginning of December this year and the manufacturer is now advancing with the production and customer deliveries. The Bavarian manufacturer has been producing the 7 Series in Dingolfing since the launch of the first generation of the luxury saloon in 1977. The original 7 was launched with some revolutionary features in the segment, including standard power steering, automatic transmission with 2 pre-programmed driving modes and an onboard computer. Over the next 2 generations, the premium saloon received goodies such as ABS, parking sensors, a navigation system, airbags and many others. In preparations for the start of production of the 7th generation 7 Series, BMW has invested more than €300 million in its vehicle plant in Lower Bavaria. The automaker is revolutionising the segment again with a process in which the vehicles drive themselves autonomously from the production line to the area where the final inspections are made. BMW proudly says it also produces electric motors and high-voltage batteries for the i7 in Dingolfing. “The BMW 7 Series is our top model”, Dingolfing plant manager Christoph Schroder comments. “In it, we combine progressive luxury and the latest technologies. Like no other model, it stands for automotive innovations and now also for our electric offensive in the luxury segment. What makes me particularly proud is that we have been producing it here since it was introduced 45 years ago”. BMW’s plant in Bavaria is one of the company’s more than 30 production sites around the world that are currently assembling vehicles for the global markets. It is the brand’s largest factory in Europe and it is also responsible for the production of the 4 Series, 5 Series, 6 Series, 8 Series and iX. The annual output of the factory is close to 250.000 units. +++
+++ The world’s third-largest carmaker isn’t from the U.S., Japan or Europe, at least not anymore. It’s South Korea’s HYUNDAI . While Toyota and Volkswagen vie each year for pole position atop the global automobile industry, Hyundai has quietly slipped in behind them, surpassing General Motors, the Nissan-Renault alliance and Stellantis in annual volumes along the way. Founded 55 years ago as a manufacturer of affordable vehicles for its home market, Hyundai’s international expansion only began in earnest in the 80s. After working for decades to shake its image as an upstart, Hyundai’s Genesis is now going head-to-head with other luxury car brands, while the carmaker is duking it out with Ford for second place in U.S. electric vehicle sales this year, behind Tesla. “We are on the right track and this year we were very strong”, president and co-CEO Jaehoon Chang, 58, said in an interview from a library at Hyundai’s Seoul headquarters last week. “Our supply chain management was key. We’re trying to be flexible, and optimize and protect production as much as we can in spite of the chip shortage”. With greater scale, however, comes bigger challenges, including the suspension of a large factory in Russia and new U.S. legislation that could hurt EV subsidies. The manufacturer also faces higher raw material costs, an ongoing chip shortage and allegations that Hyundai’s suppliers in Alabama hired underage workers. North America represented 21% of total sales last year, making it Hyundai’s biggest single market, while just 17% of revenue came from its home market. Hyundai’s global presence is rooted in the company’s strong manufacturing base in South Korea. At Ulsan, located at the mouth of the Taehwa River on the peninsula’s eastern coast, it operates the world’s biggest assembly plant with an annual production capacity of 1.4 million vehicles. From the vessels shipping cars abroad to the steel used in both, all are part of the same conglomerate, started by the grandfather of Euisun Chung, Hyundai Motor’s other CEO and executive chair. With another 9 factories spread across the globe, the automaker sold 6.6 million vehicles in 2021. This year, revenue is on track to expand 21% to 141.7 trillion won ($108 billion), the highest growth rate among major carmakers, according to the average of analysts’ projections. Critical to those gains, and its prospects going forward, is Hyundai’s embrace of electrification. While other carmakers take more deliberate steps, the South Korean company raced ahead, pushing out models such as the Ioniq 5 and affiliate Kia’s EV6 just as demand started to outpace supply. At the same time, Volkswagen has struggled to get its EV strategy on track, while Toyota is still hedging its bets, betting on hybrids and hydrogen fuel cells, as well as EVs. Emboldened by that success and backed by 19.4 trillion won in investments, Hyundai plus Genesis plans to introduce at least 17 battery-powered EVs by 2030, as well as 14 by Kia, which will be a “huge enabler” to reach the company’s goal of 1.87 million annual EV sales in 2030, Chang said. That would represent 11% of the U.S. market and 7% globally, according to the automaker. Leading the charge is the Ioniq 6, Hyundai’s latest EV. Introduced earlier this year, the sedan can travel as far as 610 kilometers. With a sleek, rounded body and interior lighting that can change color depending on the speed of the car, the Ioniq 6 is aimed at younger buyers. Ioniq 6 sales in South Korea began in September at prices starting at 52 million won, or $40,000. In Europe, home to some of the biggest EV-adopting countries, pre-sales for an initial allotment of 2,500 Ioniq 6s sold out in less than 1 day. It was “actually few hours, proven evidence of demand”, Chang said. The U.S. rollout will begin in early 2023. Genesis sales will expand 10% this year to 220.000 units, Hyundai forecasts. In a move that will pit it more directly against Tesla and legacy brands such as BMW and Mercedes-Benz, Hyundai plans to make its Genesis luxury line fully electric by the end of the decade. “This segment has a high barrier to get into, so that was very challenging once we started”, Chang said. “So we focused on design first, how we can be differentiated from others. We focused more on the drivers, more on the passengers, let them feel comfortable, to define luxury as comfort”. This week, Hyundai also unveiled the latest iteration of its Kona, designed first as an EV but also being made available with a combustion engine and hybrid variants. While Hyundai may be navigating the EV transition more smoothly than some peers, it also faces shared challenges. Asked whether Hyundai was close to any decision regarding the fate of its plant in Russia, where operations have been suspended since the start of the war in Ukraine 8 months ago, Chang said company had little choice but to “monitor the situation”. “It’s not easy for us, because of the scale of the plant”, he said. While Toyota and Nissan exited Russia in recent months, Hyundai has a much bigger operation in St. Petersburg that, together with Kia, assembled about 200.000 vehicles a year before the war, or around 4% of the automaker’s global output. Regarding China, where Hyundai is seeking to reposition itself as a more upmarket brand, Chang said “we need to sharpen our edge”. Car sales in what is the world’s biggest market declined 4.2% last month as Covid-related lockdowns kept buyers aways from showrooms. In Alabama, Hyundai is investigating allegations that 2 suppliers, Hwashin America, a Korean maker of chassis and auto-body components, and Ajin Industrial, a Korean auto-parts manufacturer, both employed minors at their plants in Greenville and Cusseta, Alabama. “Hyundai does not condone or tolerate violations of labor law”, the automaker said in an emailed statement. “We mandate that our suppliers and business partners strictly adhere to the law, and we take reports of alleged violations very seriously”. Another challenge for Hyundai is the U.S. Inflation Reduction Act, which requires that EVs be assembled in North America with batteries made from materials sourced from friendly trading partners in order to quality for tax credits. Hyundai has been working with the South Korean government to persuade the U.S. Treasury Department to tweak the bill or loosen enforcement as it works to finalize guidance. “This is a very critical moment”, Chang said. While the legislation requires carmakers to assemble their EVs in North America to receive the subsidy, Hyundai doesn’t yet have any operational EV plants, although it is seeking to build a $5.5 billion EV and battery facility in Georgia. “We’re expecting some flexibility in giving us more time to be fully ready for this”. +++
+++ MAZDA is lagging behind other automakers when it comes to the electrification of its vehicles and it has yet to officially announce the introduction of a new electric vehicle. It only sells the MX-30 as a full EV and it recently added the CX-60, its first ever plug-in hybrid, but a new report says it could be working on another BEV, a sedan about the size of today’s three-box Mazda 3. Mazda patent drawings clearly show the manufacturer has submitted a sedan that runs on electrons. This may not be immediately apparent, because the floor looks too thin to house an EV battery pack, but that’s apparently one of its unique features. We’ve not seen a battery pack this thin in another production EV and we have no details yet about where the manufacturer is sourcing the cells, who is building the pack and what technology is going to be used. Apparently the patent filing says that it is a conventional lithium-ion battery pack, although the source also mentions that it could be a solid state pack, which could be one explanation for the pack’s unusually low height. According to the patent drawings, it appears that the vehicle has been designed to be front-wheel drive, making the vehicle identical in its configuration to today’s Mazda3. However, the source says the patent states that a rear motor could be added to make the vehicle all-wheel drive. This is not shown in any of the patent drawings, though. There is a chance this may even be a direct (electric) replacement for the Mazda 3, one that is due closer to the end of the decade. It’s worth noting, though, that filing this patent doesn’t necessarily mean Mazda will actually build this vehicle. Automakers do this all the time and not everything they patent and trademark actually ends up being used in production vehicles. However, given that Mazda is falling behind other automakers that are offering more EVs, a vehicle like this small electric saloon would probably make a lot of sense for the company to launch in the near future. +++
+++ A prestigious award by Auto Motor & Sport Sverige, a leading Swedish car magazine, was won by the NIO ET7 . The editorial team awarded the Chinese electric sedan as Car of the Year and also as best in the luxury class. “A new brand is shaking up. Luxurious experience at a good price”, magazine comments. Last week Nio also opened the first Nio Space in Sweden in Westfield Täby Centrum, Stockholm. Since Nio entered the EU market in October, the ET7 sedan has collected 2 prestigious awards. First, it impressed Germany by winning the Golden Wheel award, and later ET7 became Technological Frontrunner of the Year in Denmark, beating the Mercedes EQS and Tesla Model Y. In December, Nio achieved second place in the Norwegian Car of the Year award. “Nice design, great space, high comfort combined with raw muscle power and good range are all ingredients that will undoubtedly lead to the NIO ET7 gaining many followers”, the jury said. The Volkswagen ID.Buzz was the winner. Norway was Nio’s gateway to Europe in late 2021 and has sold there nearly 1.300 cars since then, mainly the ES8 (a SUV). Nio follows its ’25 countries by 2025 plan’ and entered the first EU countries in October: Germany, Denmark, Sweden and the Netherlands. In the second phase, Nio will enter Austria, Belgium, France, Hungary, Italy, Spain and Switzerland. William Li personally confirmed that Nio aims for the US market in 2025, although it will be difficult. Nio already has US headquarters in San Jose, California, and recently signed a 10 years lease there. Nio also pushes for building infrastructure in Europe. On December 16, Nio opened its first EU Nio House in Berlin and its second in Europe after Nio House in Oslo. They also planned to have 20 PSSs in Europe by the end of 2022; this goal was later reiterated by Nio’s president Qin Lihong to 17-18 units. Nio currently has 9 PSS in operation in Europe, the latest being open in Apeldoorn, Netherlands. The 10th European PSS in Den Hoorn (third in the Netherlands) will open soon. The Nio’s goal for 2023 is to have 120 PSSs in Europe. Nio will unveil 2 new models on December 24 during the annual Nio day. One of them will be refreshed Nio ES8 2023 based on the new NT2 platform and the second car remains in mystery but based on recent spy shots, I assume it might be the Nio ET5 stationwagon. The deliveries of ET7 in Europe have already started; EL7 (ES7) will begin deliveries in February and ET5 in March. Originally Nio announced it would offer only a subscription base model in Europe; later, after a customer backlash, it was changed, and Nio showed a buyout option. +++
+++ TOYOTA is the world’s largest car maker by production and sales. Thanks to its commitment to quality, and the efficiency of its plants around the world, this Japanese car maker is known in every single country. It has a strong presence in all the 5 continents through production factories and design centres. A big part of the popularity of Toyota is due to its ability to offer the right vehicle in every market. Better than its rivals from Japan, USA and Europe, Toyota is quite good by creating cars for the taste of the markets where it operates; and they are usually global products. The Corolla, RAV4, Land Cruiser and Yaris are just 4 examples of a huge lineup that’s appealing everywhere. The other part of the explanation is hybrid engines. Toyota has been producing hybrid cars for more than 20 years with millions of units sold since then. The investment on this powertrain is paying off: the brand is ahead of its rivals in terms of fuel emissions and makes money with these cars. Despite the success and the positive image hybrid technology has given Toyota, some external factors are forcing the brand to accelerate the next step. They need to decide whether to continue improving the existing technology or shifting to zero emissions powertrains such as pure electric cars. The problem is that the second option is a bit unknown for Toyota. As their focus these past 20 years has been on the development and proliferation of hybrid cars, they allocated less resources and interest for electric cars. Today, Toyota is the world’s largest pure hybrid car maker, but one of the smallest EV makers. As emissions regulations get tougher around the world, it is clear that hybrids won’t be enough to meet the targets. They are already at the limit of internal combustion engines coupled with an electric motor. And although their impact has been quite positive on emissions, they would have never been able to take them to zero. The technology is the ideal solution for now, but not in 10 years. What will Toyota do? Will they continue to bet on this interesting, affordable, and easy-to-operate solution? Or will they finally give up and move to the electric solution? +++
+++ When VOLVO unveiled its new flagship model in early November, it only showed the EX90 with a 3-row layout and 7 seats. However, a potential expansion of the electric SUV’s lineup is possible courtesy of the newly developed SPA2 platform shared with the Polestar 3. In an interview, the Swedish automaker’s chief operating officer Javier Varela said the architecture’s modularity supports a 2-row variant. That doesn’t come as a big surprise considering the Polestar 3 doesn’t have a third row. Both come with a dual-motor setup with all-wheel drive and a combined output of 524 hp and 910 Nm of torque. However, there’s room for more as the dedicated EV architecture can be tweaked for a high-performance application. It would make more sense for the Polestar model than the Volvo, but it’s too soon to say when/if it’ll happen. At the other end of the lineup, a single-motor Volvo EX90 would be rear-wheel drive, according to Varela. A base model would undercut the sole version arriving for the 2024 model year as “well-equipped costing about €80.000”. Initially, the large electric SUV will be produced only in China before hitting the assembly line in 2024 at the upgraded Ridgeville plant. The Polestar 3 will also be assembled at both factories. Volvo is not giving up on the combustion-engined XC90 just yet since the Swedes aim to keep it on sale for an unspecified number of years in parts of the world where EV adoption isn’t that great. In the long run, the Geely-owned marque will come out with a more advanced electric-only architecture, dubbed GPA, which will have much quicker charging speeds courtesy of using an 800 Volt system. +++
