+++ The AUDI Q5 is a crucial model in the German brand’s line-up and was its best-selling model globally in 2023, which makes the arrival of the new third-generation Q5 later this year all the more significant. Since the current generation model was launched in 2017, BMW, Lexus and Mercedes have launched all-new or heavily updated versions of their rival premium mid-size SUVs, the X3, NX and GLC. Competition has broadened too, with similarly upmarket EVs like the Lexus RZ looking to take the spotlight from the internal-combustion engined Q5. There won’t be an electric version of the next Q5, with that role essentially being played by the all-new Q6 e-Tron. This will allow the new Q5 to focus on internal-combustion engines and various hybrid options, helping it appeal to existing Q5 customers as well as those not yet ready to make the switch to a full EV. The third-generation Q5 will get a set of subtle styling tweaks including a wider, flatter grille and slimmer headlights. We’ll also see the implementation of Audi’s 2-dimensional 4-ring logo on the front and rear, but the updated car is expected to remain a recognizable part of the Q5 lineage, rather than debuting a dramatic redesign. The side profile of the car suggests the windscreen rake may be a little sleeker to provide better aerodynamics and the angle of the rear window looks slightly shallower too, although a coupe-SUV Q5 Sportback body style will be part of the range as well. It’s inside where we’re likely to see the biggest departure from the old car. The third generation Q5 is expected to lift its cabin from the Q6 e-Tron, meaning a dual-screen layout for the infotainment and digital instrument cluster, plus an additional display ahead of the passenger. This third screen will come with an ‘active privacy mode’ to prevent the driver from being distracted at the wheel. Other tech highlights for the new Q5 are likely to include an augmented reality head-up display, plus a self-learning AI voice assistant. Safety will be paramount, of course, with the new SUV utilizing Audi’s full suite of assistance systems and semi-autonomous drive functions. The third generation Q5 will sit on Audi’s new PPC (Premium Platform Combustion) architecture. This setup will also underpin the brand’s A4 successor, which will be badged as the Audi A5 when it arrives in the summer. The Q5 will continue to be offered with petrol, diesel and TFSI e plug-in hybrid powertrains; the latter of which will most likely have a zero-emission range in excess of 100 km. That’ll help keep it competitive, though it’ll need an even bigger battery to match the quoted 130 km range of the latest Mercedes GLC 300e. A 400 hp Audi SQ5 will be shown at the same time as the standard SUV, though I’m of the understanding Audi will continue to refrain from offering its popular family SUV with an RS badge. +++
+++ The Neue Klasse aims to offer ‘ BMW driving pleasure ‘ at an even higher level. In this vehicle of the future, this will be ensured by 2 of the 4 completely new highly integrated electronic control units, working smartly together on what was previously processed separately. The first control unit integrates the entire powertrain and driving dynamics, with up to 10 times more computing power, based on a new software stack developed in-house by the BMW Group. The second control unit will enable the next quantum leap in automated driving. More detailed information on the other 2 highly integrated electronic control units (one in charge of connectivity and infotainment functionality, the other clustering more than 100 core vehicle functions, from the digital car key, to energy supply, to wire harness communications) will be provided at a later date. In addition to further improved e-drive units, this 6th generation of BMW eDrive technology also features new, now round, lithium-ion battery cells, with a volumetric energy density over 20% higher than that of the prismatic cells previously used. In combination with the transition to an 800 volt system, this will improve charging speed by up to 30%, allowing vehicles to charge sufficiently for a 300-kilometre range in just 10 minutes. The 6th generation of BMW eDrive also delivers up to 30% more range. At the same time, this new technology generation should significantly reduce costs: Compared to today’s Gen5 technology with a comparable range, the cost of the electric Gen6 system, i.e. the high-voltage battery with powertrain, should be 40-50% lower. When it comes to aerodynamics, the Vision Neue Klasse X boasts an impressive new top figure: Drag has been reduced by 20%, compared to a comparable model in the current line-up. New tire designs and a special brake system for fully-electric vehicles help boost the vehicle’s overall efficiency by up to 25%. The BMW Group already presented its vision of the future digital experience, both inside and outside the vehicle, with i Vision Dee, at the CES in Las Vegas in 2023. The new iDrive, now showcased in the Vision Neue Klasse X, is based on a highly integrated software architecture and relies on the next-generation BMW Operating System. In this vehicle, BMW Panoramic Vision projects key information across the full width of the windscreen. This will be complemented in the Neue Klasse by the enhanced 3D head-up display. In combination with a newly developed steering wheel with multifunction buttons, the new central display and the advanced voice control of the BMW Intelligent Personal Assistant, iDrive takes interaction between the driver and their vehicle to a whole new level. However, all these innovations and technological advances are not just designed to benefit the models of the Neue Klasse, but the whole BMW product line-up. The basis for this is the modular principle the BMW Group has established in its technology clusters. These technology clusters, covering the areas digital, drive train, driving exterior and interior, can be used across segments for most of our product line-up. They are scalable, can be used on all architectures and can thus be modified for different vehicle concepts and segments. “Our technology clusters give us important leverage for fast and efficient scaling of innovations and technological advances. In this way, we are able to ensure that we offer our customers the latest technology, regardless of the segment and the vehicle’s powertrain”, said CEO Oliver Zipse. These innovations will be making their debut in the Neue Klasse very soon. The first vehicles are currently completing test drives under extreme conditions. Series production will then ramp up in the second half of 2025 at the high-volume core of the BMW brand, with a SUV that is previewed in the Vision Neue Klasse X. This will be followed by a sedan in the current 3 Series segment, of which an initial glimpse was provided at the IAA MOBILITY. BMW intends to launch a total of at least 6 Neue Klasse models across the BMW Group’s global production network within the first 24 months of the start of production. The Neue Klasse will be launched in 2025 at the new BMW Group Plant Debrecen (Hungary), which will exclusively produce vehicles from this line-up. From 2026 onwards, Neue Klasse cars will also be built at the more than 100-year-old main plant in Munich, which is currently completing the necessary preparations to transition to BEV-only production from 2027. In the same year, series production of the Neue Klasse will begin at Plant San Luis Potosí (Mexico), while the production site in Shenyang (China) is also gearing up for production. +++
+++ HYUNDAI will reduce production costs for its electric vehicles (EVs) to counteract an ongoing price war sparked by Tesla in the global EV market, the Korean carmaker’s chief executive said Thursday. The company also unveiled its plan to pursue the transition of all models into software-defined vehicles (SDVs). SDVs refer to cars that can manage their operations, add functionality and enable new features primarily or entirely through software. During an annual general meeting of shareholders, Hyundai CEO and president Chang Jae-hoon said the company will be more flexible and agile, in order to cope with uncertain business environments and worsening consumer sentiment. “Triggered by the rival’s aggressive price reduction policy, competition has been intensified to secure cost competitiveness in the EV industry”, he told shareholders. “We will secure cost competitiveness through innovation in our manufacturing processes”. His remarks came as the carmaker’s shareholders raised questions about a deceleration in global demand for EVs recently. In order to attract consumers, Tesla, Ford and Chinese carmakers such as BYD have made aggressive price cuts for their EVs. The Hyundai CEO emphasized that the company will overcome the current difficulties by strengthening its value chain in emerging markets. “We are pushing ahead with the release of our electric SUV this year”, he added. For the transition to SDVs, Hyundai said it plans to integrate its R&D organizations by establishing a team in charge of advanced vehicle platforms. “We will accelerate mass production of SDVs through a chip-to-factory strategy, which embraces the production of small components and large vehicles”, Chang said. +++
+++ The automobile industry in JAPAN has reached a turning point. Honda and Nissan , Japan’s second and third-largest automakers, announced last week that they have agreed to begin a feasibility study of a strategic partnership mainly in the field of electric vehicles. They aim to be more competitive when it comes to costs by standardizing core components for EVs. With the auto industry entering a period of once-in-a-century transformation with the advent of Chinese automakers, a sense of urgency over lagging behind in the EV market pushed the 2 firms to consider joining forces. “Emerging companies are becoming competitive extremely quickly. We are aware that we might be shaken out”, Toshihiro Mibe, president of Honda, said emphatically at a press conference. Major Japanese automakers, including Honda and Nissan, have made sizable investments in storage battery plants and other facilities for EVs, but they have been struggling as Chinese automakers introduce low-priced EVs. In mid-January, Nissan began high-level discussions with Honda, which has remained independent in research and development. The announcement last week comes only 2 months after several rounds of talks between the 2 companies. Nissan president Makoto Uchida said: “If we take time to predict what things will be like 5 years from now, there is no time to waste”, Mibe said, “In order to remain leading players in the future, it was now or never to make a move”. Instead of worrying about the details, the 2 companies apparently decided to launch their partnership negotiations to make a breakthrough on their struggles in the EV market. Nissan leads the EV market in Japan but faces many challenges overseas. Nissan plans to reduce production capacity by about 30% in China due to sluggish sales. In Europe, Nissan has a mutual stake in Renault Group and has been working with a Renault-affiliated EV company. However, in Japan and the United States, the company urgently needs to build a cooperative partnership with other companies to reduce costs. Honda aims to have EVs and fuel cell vehicles (FCVs) represent all of its new vehicle sales by 2040, but the prospect of achieving that goal is unclear. In the United States, Honda has been collaborating with General Motors, but in Japan, it has been hampered by its stance of working alone in development and production. Sakura, a light EV developed and produced jointly by Nissan and Mitsubishi, has sold 60.000 units since it went on sale domestically in 2022. Meanwhile, Honda has not been able to launch a light EV, and its domestic sales of EVs was 286 units in 2023. Mibe said: “We will make the most of mass production efforts through the partnership”. If the partnership between the 2 automakers expands further in the future, it may alter the market share of top manufacturers in the auto industry in Japan. The Japanese auto industry has been structured as an alliance between Toyota, Subaru and Mazda; an alliance between Nissan and Mitsubishi Motors; and the independent Honda. Both Honda and Nissan presidents denied any talks of a capital tie-up for now, but they are expected to consider having Mitsubishi Motors, which has close ties with Nissan, join this latest partnership framework. However, many challenges lie ahead for the partnership. Honda has long worked by itself. Some say Honda was passive in forming the partnership and that the difference in corporate cultures will become a barrier. Coordination with a wide range of parts suppliers is also expected to be difficult. +++
+++ KG MOBILITY is facing a leadership vacuum after its former CEO Jeong Yong-won stepped down due to alleged corporate capital embezzlement and because the company is grappling with a decline in sales, analysts and company officials said Friday. The overnight decision by the automaker’s co-leader is feared to have dealt a blow to the company at a crucial time when the company was looking to achieve stable growth after achieving its first-ever surplus last year. The leadership crisis adds even more of a burden on KG Group chairman Kwak Jae-sun, who has served as co-leader of the automaker after the group took over SsangYong, the formerly cash-strapped automobile manufacturer in 2022. The recently rebranded automaker has since displayed signs of rapidly normalizing its financial soundness by revamping its overall growth strategy and focusing on a few strategic models, such as the Torres EVX. But this scandal is tainting its brand image once again, sparking concerns over whether the automaker will be able to proceed with its pending tasks ahead in a timely manner. According to data from the automaker, KG Mobility suffered a domestic sales fall of 44.8 percent in February from the previous year, hit hard by prolonged inflationary pressure and high interest rates. Sluggish demand for electric vehicles (EV) also comes as a lingering concern for most automakers, including KG Mobility. The stock price fell by around 20 percent at the time when police launched a search-and-seizure on the firm’s headquarters. Analysts said any embezzlement scandal, by top executives, affects a firm’s stock price, and this may result in a possible trading suspension. “An embezzlement scandal of a certain firm’s executives does affect its stock prices and financial authorities decide to suspend its stock trading if the embezzlement scale is big enough to pose a financial threat to its normal management”, Hwang Sei-woon, a research fellow at the Korea Capital Market Institute, said. A KG Mobility spokesperson said Jeong will keep carrying out his tasks, as he will not immediately leave the firm due to the embezzlement allegation. “He expressed his intention of resigning from the top executive position, but will work on his tasks”, an official from the automaker said. Jeong and a group of the firm’s executives face police investigation for allegedly embezzling hundreds of millions of won between 2016 and 2018 while signing service contracts with securities firms. KG Mobility issued official statements, saying that the scandal has little to do with the firm’s current financial circumstances, as the issue took place before KGM acquired SsangYong. “KG Mobility is now a clean company after completing the corporate rehabilitation processes while acquiring the formerly SsangYong”, the company said. +++
+++ Hyundai and KIA are advised to step up their strategic focus on Europe and Southeast Asia, as the local carmakers are feared to face harsher and less predictable trade barriers in the U.S. if former president Donald Trump wins the election later this year, experts said. The analysis came as battery firms and electric vehicle (EV) makers are the most vulnerable in the event of Trump’s reelection, as he threatens to abolish the Inflation Reduction Act (IRA) pushed by incumbent president Joe Biden. The IRA is the mainstream policy enabling Korean EV firms to receive huge tax credits when using batteries with critical materials that have been extracted in the U.S. or other countries that have free trade agreements with the world’s largest economy. At a Korea-U.S. trade forum hosted by the Korea Chamber of Commerce and Industry, experts voiced the dire need for local carmakers to be more flexible in diversifying their sales channels to other regions, so they can minimize possible repercussions from Trump’s possible return to power. “If Trump seizes power again, this will deal a severe blow to the EV industry, so carmakers here are urged to focus more on EV-friendly marketplaces such as the European Union, or adopt a strategy of expanding production and sales for hybrid vehicles”, Park Joo-hyun, a partner at Yulchon, said during the forum. Lee Ho-geun, an automotive engineering professor at Daedeok University, also underscored the importance for Korean carmakers to generate more sales in such regions as Europe, Southeast Asia and South America. “The U.S. market comes with unpredictable political risks, so local carmakers need to expand their sales channels into stable markets (such as Europe) and others with huge growth potential, including India, and a group of other countries in Southeast Asia and South America”, Lee said. But some other experts said Hyundai and Kia should never take their focus off the U.S. market. “Regardless of the results of the upcoming presidential election, the U.S. is undoubtedly the most important export partner for Hyundai Motor and Kia”, said Kim Pil-soo, an automotive technology professor at Daelim University College. Both carmakers should keep pushing ahead with their ongoing 2-track overseas strategy, under the 2 pillars focusing on the U.S. and other regions, as they can be more globally recognized only after being more widely recognized in the world’s largest economy, according to him. +++
+++ Chinese electric vehicle company LEAPMOTOR will begin production of a small car at the Stellantis (former Fiat) plant in Tychy (Poland), 2 people familiar with the matter have said. Production of the Leapmotor T03 small car will start as early as the second quarter of this year, using so-called semi-knocked down (SKD) technique, which consists of turning partially assembled kits into finished vehicles. The T03 is a compact battery electric vehicle (BEV) and is the least expensive of Leapmotor’s models currently on sale. On March 2, Leapmotor launched the facelifted T03 in China, offering 3 versions. Their CLTC ranges are 200 kilometers, 310 kilometers and 403 kilometers respectively. The T03 sold 35.454 times in 2023, contributing 24.6 percent of Leapmotor’s annual sales of 144.155 units. Leapmotor announced on October 26 last year that Stellantis would invest 1.5 billion euros in it for a roughly 20 percent stake, making it the EV maker’s largest outside shareholder. The 2 companies plan to form a joint venture called Leapmotor International to accelerate and expand global sales of Leapmotor’s products by leveraging Stellantis’ global resources, Leapmotor’s announcement said at the time. Stellantis will own 51 percent of the joint venture, with Leapmotor holding the other 49 percent. The joint venture will have the exclusive right to conduct export and sales operations to all other markets in the world except Greater China, as well as the exclusive right to manufacture Leapmotor products locally. Notably, Leapmotor chairman Zhu Jiangming said in a group interview with Chinese media that the company will begin selling vehicles in overseas markets in the third quarter of this year. +++
+++ RENAULT KOREA will invest 1.5 trillion won ($1.13 billion) for future mobility by 2027 for its transformation into a state-of-the-art hybrid and electric vehicle (EV) manufacturer here, the company said Thursday. Under a 3-year plan, the company will allocate 118 billion won for equipment renovation in its manufacturing facility in the nation’s southeastern port city of Busan. The investment will serve as a stepping stone for its production of its future hybrid and EV models. The carmaker also promised to hire 200 new employees there. “We will also invest 700 billion won for our Aurora project, and our total investment will amount to 1.5 trillion won after completing one for our next-generation EV”, Renault Korea CEO Stephane Deblaise said. Renault Korea is placing its strategic focus on the Aurora project. Renault Korea is scheduled to launch its Aurora 1 hybrid SUV sometime in the latter half of this year. The Aurora 2 mid-sized hybrid vehicle is also expected to make its debut next year. The Aurora 3 is Renault’s new EV model, which will be unveiled in 2026. The carmaker aims to rev up its sales with the new strategic model. The company did not release any new model for the past 4 years, so it seeks to regain customers’ spotlight by launching the Aurora 1, in line with a boom in hybrid vehicles. Renault Korea spoke highly of the investment plan, saying that it will help create jobs for 90.000 people directly and indirectly. The carmaker also clinched a partnership with the city government of Busan. The latter also pledged to spare no efforts in offering administrative and financial support for Renault Korea’s investment plan. Renault Korea is one of the group’s 5 global hubs. The firm’s Busan factory will be in charge of developing and producing its high-end mid-sized and semi-large-sized vehicles. +++
