AD #2529 – FCA Ok with Gladiator Stealing Wrangler Sales, Jaguar Land Rover in Trouble, Recycling EV Batteries

This is Autoline Daily reporting on the global automotive industry.

Hi I’m Sean McElroy. It’s February 11th, 2019. And now the news.

JAGUAR LAND ROVER IN TROUBLE
Wow, all of a sudden, Jaguar Land Rover is in trouble. And it all has to do with a big slump in China. Last quarter, JLR’s sales in China plummeted 47%. Interestingly, JLR says that’s because the Chinese government is boosting support for state owned companies, while JLR’s sales come primarily from private entrepreneurs. And the growth of private companies is dropping. Another problem is that 82% of JLRs dealers are in smaller cities in China, and it needs to tap into the big Tier 1 cities. So now JLR is going to lay off 4,500 employees on top of the 1,800 who left last year. And it’s going to take a $4 billion write-down. Even more, it has to raise another billion bucks over the next year at the same time it has to spend heavily on electric cars. JLR is doing well in almost every other market, but the problems in China are dragging the entire company down.

NIKOLA MOTORS TO OFFER ELECTRIC SEMIS
In a somewhat surprising development, Nikola Motors, a company that’s working on hydrogen powered semi-trucks, announced it will offer battery electric versions of its trucks too. Its Nikola Two and Nikola Tre trucks will be available to order with 500kWh, 750 kWh and 1 mWh battery packs. So why the move to batteries? The company says hydrogen-powered semis are ideal for long-haul trips while BEVs are more useful in cities and short haul deliveries. Nikola will show off the battery electric models in April.

TAKATA AIRBAG RECALL EXPANDS
The Takata airbag saga has been going on for years and there’s still no end in sight. Seven automakers announced additional recalls, totaling 1.7 million vehicles. This is on top of another 5 million vehicles that Ford, Honda, Toyota, and Fiat Chrysler will recall in 2019. In total about 10 million inflators will be recalled in the U.S. this year. The entire list of vehicles has been announced in chunks as not to put too much strain on the supply of replacement airbags or financial pressure on automakers. The last of the vehicles will be announced through the end of next year, which will bring the grand total to around 70 million in the U.S.

FCA expects the new Gladiator pickup to cannibalize sales from the Wrangler. But it doesn’t care. We’ll explain why right after this.

JEEP TESTING GRAND COMMANDER IN MICHIGAN
If the Jeep brand is missing anything from its lineup it’s a 3-row utility vehicle. We’ve reported Jeep will get the Ram-based Wagoneer, but could it add another 3-row as well? We spotted the automaker testing the 7-passenger Jeep Grand Commander in Michigan over the weekend. The vehicle is currently sold in China. But we’re not so sure it would make sense in the Jeep lineup. It’s built on a modified version of the same platform that underpinned the Dodge Dart and Chrysler 200. Meaning it might not live up to Jeep’s off-road heritage. We’ve seen rumors the Grand Commander could be sold as a Chrysler in North America and this spotting would add fuel to that speculation.

FCA OK WITH GLADIATOR STEALING WRANGLER SALES
Speaking of Jeep, it knows that the Gladiator is going to eat into sales of the Wrangler, since the Gladiator is based on the Wrangler. In fact, it fully expects the Gladiator to siphon off 10-15% of sales of the Wrangler. Moreover, production of the Wrangler will temporarily stop in the second quarter this year, as they make changes in the assembly plant to build a plug-in hybrid version of the Wrangler, which will go on sale early next year. But Mike Manley, the CEO of FCA, says even with all that, they expect the combination of Wrangler and Gladiator sales to be 50,000 units higher by the end of this year, so they’re not all that worried about any cannibalization.

FORD ADDS MORE PROTECTION TO POLICE INTERCEPTOR
Police departments face an increasing problem of people crashing into patrol cars parked at the side of the highway, after pulling over a speeder or investigating an accident. Cops are getting hurt and even killed. So Ford is now installing an X-shaped cross-member in the rear of the Explorer Police Interceptor that adds 160 pounds of steel. While all vehicles have to meet a federal standard for protection in a 50 mile an hour rear collision, the X-frame bumps that up to 75 miles an hour. So we here at Autoline want to remind everyone that when you see a patrol car on the side of the road, move over a lane, and if you can’t, slow down.

There’s a flood of electric cars coming to the market. But there’s also a problem with them. No one knows how to recycle the batteries. That’s coming up next.

RECYCLING EV BATTERIES
Automakers and governments around the world are going all-in with electric vehicles. While they will be greener in the long run than internal combustion engines, there’s still an issue about recycling the batteries. No one knows how to truly re-use the materials. On last week’s Autoline After Hours we were joined by Brett Smith, a powertrain expert at the Center for Automotive Research. And he explained how the issue is being tackled.

(The AAH 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 look for it on our YouTube channel.

But that’s it for today, thanks for watching and we’ll see you again tomorrow.