Runtime: 9:12
0:31 Trump Proposes to Rollback Fuel Economy Rules
1:33 No End in Sight for Passenger Car Decline
2:03 Tesla No Longer a Niche Player
2:37 Ford Uses Motion Capture to Improve Production
3:17 Chevy Makes Towing Easier in New Silverado
4:23 Ferrari’s Stock Takes a Big Hit
5:04 GM Seeks Buick Envision Tariff Exemption
6:56 How OEM Bonuses Impact Car Dealers Business
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On today’s show…the Trump Administration officially unveils its proposal to rollback fuel economy standards…Toyota is selling its stake in Isuzu…and Ford is testing body tracking technology to help improve its manufacturing process. All that and more coming right up on Autoline Daily.
This is Autoline Daily the show for enthusiasts of the automotive industry.
TRUMP PROPOSES TO ROLLBACK FUEL ECONOMY RULES
Yesterday, the Trump Administration officially unveiled its plan to rollback fuel economy rules enacted during the Obama Administration. The proposal caps standards at 37 miles-per-gallon starting in 2020. That number would have risen to 47 MPG by 2025 under the previous plan. The Administration claims this will lower regulation costs for automakers and reduce car prices for consumers. It also claims the higher consumption of oil will have a minimal impact on the environment. Opponents to the plan obviously disagree and say it will accelerate climate change and increase fuel prices. The proposal also seeks to strip California of its power to set its own emission standards. Which has prompted 19 states to announce they’ll sue to stop the rollback. And that’s a nightmare scenario for automakers who want to see one standard across the entire nation. This fight isn’t over and it’s one we’ll have to keep an eye on.
NO END IN SIGHT FOR PASSENGER CAR DECLINE
Uh-oh, sales of passenger cars in the U.S. market have been dropping by roughly 63,000 cars a month. But as we reported yesterday, sales dropped by 86,000 cars last month. So it’s getting worse. We are now on pace to see sales fall by 760,000 passenger cars by the end of the year, which is a staggering number. At some point in time, this has got to bottom out. But so far there’s no end in sight.
TESLA NO LONGER A NICHE PLAYER
Speaking of sales, here’s a fascinating number that most people missed. WardsAuto reports that last month Tesla sold 9,517 cars in the U.S. market, up nearly 200% compared to last year. Tesla sold twice as many vehicles as Porsche. It sold more than Jaguar Land Rover, more than Volvo and nearly as much as Mitsubishi. And that means Tesla is no longer a little niche player. It’s now a full-blown member of the automotive manufacturers’ club.
| U.S. JULY 2018 SALES | ||
|---|---|---|
| Tesla | 9,517 | +193% |
| Porsche | 4,020 | +7.3% |
| JLR | 8,089 | -7.2% |
| Volvo | 8,622 | +28.9% |
| Mitsubishi | 9,950 | +29.2% |
| Source: WardsAuto | ||
FORD USES MOTION CAPTURE TO IMPROVE PRODUCTION
Ever see those motion capture suits with all the little sensors on them? Video game developers and animation studios often use them to record sports players and put their movements on screen. Now, Ford is planning on using this tech to design “less physically-stressful workstations,” on assembly lines, which they say will improve manufacturing quality. “Specially trained ergonomists” will collect data on employees’ postures, helping them to improve their posture and reduce stress on their head, neck, back, and more. All a worker will need to do is put on the suit and do their work while the camera tracks the motion sensors.
CHEVY MAKES TOWING EASIER IN NEW SILVERADO
With the 2019 Silverado, Chevy will try to make towing a little less of a headache. Buyers will be able to use an app that connects to their truck, called myChevrolet, to make towing easier. For example, drivers will be able to test the lights on their trailers through the app, meaning they will not need a second person to stand behind the truck and watch for them. There is also an optional Advanced Trailering System. This includes Auto Parking Brake Assist, which prevents the truck from rolling back after being parked and a tire monitoring system. An optional mirror-mounted camera is available as well. The 2019 Silverado goes on sale this fall.
Still to come…GM seeks to exempt the Chinese built Buick Envision from U.S. import tariffs.
FERRARI’S STOCK TAKES A BIG HIT
Louis Camilleri, the new CEO of Ferrari is in hot water with investors. Camilleri called the late Sergio Marchionne’s plan to reach earnings of $2.33 billion “aspirational.” And that caused Ferrari’s stock to take a big hit. It immediately dropped 12.5 percent. But Merrill Lynch says investors may have misunderstood Camilleri, that it’s merely a matter of semantics. It says the hit to Ferrari’s stock is actually a good buying opportunity. Ferrari dropped to about $125 a share, but Merrill Lynch is forecasting it will go back to $150 a share.
TOYOTA TO SELL ITS STAKE IN ISUZU
In 2006 Toyota purchased a stake in Isuzu Motors and the two companies agreed to jointly develop and produce diesel engines. But due to “changes in the market environment,” presumably the shift away from diesel to electric, Toyota and Isuzu are ending any sort of capital tie-up. Toyota is also selling its entire stake in Isuzu, which is 50 million shares. But the two will maintain current joint development projects in the area of basic technologies.
GM SEEKS ENVISION TARIFF EXEMPTION
The U.S. has slapped a 25% import tariff on Chinese-made goods coming into the country, but GM is seeking an exemption from the rule. The automaker filed a request with the U.S. Trade Representative to exclude the Chinese-made Buick Envision from the tariff. GM argues that because the majority of Envisions are sold in China, roughly 160,000 vs. 40,000 in the U.S., “assembly in our home market is not an option.” And it adds that sales of the Envision also generate funds “to invest in our U.S. manufacturing facilities and to develop the next generation of automotive technology in the United States.” But just in case it doesn’t work, GM did ship a 6-month supply of Envisions to the U.S. before the higher tariff kicked in, which should be enough inventory to last it until the end of the year.
Coming up next, a look at how bonuses from automakers, impact the way dealers run their business.
HOW OEM BONUSES IMPACT CAR DEALERS BUSINESS
Selling cars isn’t the only revenue source for car dealers, bonuses from automakers are becoming a significant portion of their revenue. On Autoline This Week, Brian Finkelmeyer from Cox Automotive says those bonuses can make or break how dealers run their business.
(The ATW preview is only available in the video version of today’s show.)
You can watch that entire discussion right now on our website, Autoline.tv or you can look for it on our YouTube channel.
But that’s it for today, thanks for watching, have a great weekend and we will see you again on Monday.
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John McElroy is an influential thought leader in the automotive industry. He is a journalist, lecturer, commentator and entrepreneur. He created “Autoline Daily,” the first industry webcast of industry news and analysis.
