AD #2709 – Details of Ford’s New Labor Contract, Fisker Reveals More About SUV, Women at Higher Risk in Crashes

This is Autoline Daily reporting on all aspects of the global automotive industry.

MORE UAW CORRUPTION REVEALED
The federal investigation into corruption at the UAW took another step closer to snagging the president of the union, Gary Jones. The Detroit News reports that Jones and one of his aides embezzled $700,000 and split it between themselves. It also reports that former union president Dennis Willams embezzled more than $1.5 million. So far the UAW has officially supported Jones and Williams. But outside labor experts say that once members ratify labor contracts with Ford and FCA, Gary Jones will be asked to step down.

DETAILS OF FORD’S NEW LABOR CONTRACT
Meanwhile we’re learning a few details of Ford’s new labor contract. UAW workers will get a $9,000 signing bonus, while temporary workers will get $3,500. Surprisingly the contract allows Ford to close its engine plant in Romeo, Michigan. That will result in about 600 workers being offered jobs at other plants or a buyout package. Nonetheless, media reports say that workers at the plant were shocked to learn the news.

HOW GM WILL OFFSET HIGHER LABOR COSTS
We’ve also got some details on how GM plans to offset the higher labor costs from its new labor contract. It will reduce the complexity of options and trim levels. It’s doing to do a better job of designing vehicles for easier assembly and manufacturing. And it’s going to re-use more components rather than redesign them. GM also has a new quality program called built-in quality level 4. That means better first time through quality, with fewer vehicles needing any repair or rework. Analysts estimate that the new labor contract will cost $100 million more the first year, rising to $350 million more a year by 2023. But GM says it’s confident it can offset those higher costs.

COLLISION TECH FOR MOTORCYCLES
Motorcycle riders are vulnerable. That’s why an Israeli startup called Ride Vision created a low-cost solution, which can be retrofitted on bikes. Called Collision Aversion Technology, it uses standard wide angle cameras and a predictive algorithm to highlight potential threats to the motorcyclist. If one is detected, the system alerts the driver with visual and audio warnings. This is the first predictive system specifically for motorcycles to hit the market. Ride Vision also recently partnered with an Italian insurance company to offer discounts to riders who equip the system on their bikes.

FISKER REVEALS MORE ABOUT UPCOMING SUV
Automotive designer Henrik Fisker is back at it. He revealed more about his upcoming SUV called the Ocean. Fisker says he wants to cut the high cost of ownership and will offer a flexible lease through a mobile app, which launches on November 27th, even though production won’t start until the end of 2021. Fisker will also handle all the service and maintenance. The Ocean features a roughly 80 kWh battery pack with range estimated between 250 to 300 miles. A solar panel roof adds up to 1,000 miles of range per year. A unique aspect of the vehicle is a fixed hood, which cuts down on cost needed for sealing and latches. Under the hood area is a lot of the electronics and the air conditioning unit, which will open up interior space. The Ocean will be roughly the size of a Ford Escape or Chevy Equinox and Fisker is aiming for a starting price of under $40,000.

ROCKSTAR SHOWS OFF CUSTOM KONA FOR SEMA
Automakers often show off SEMA concepts that we wish they’d actually make and here’s another. Created by Rockstar, this Hyundai Kona has been given a baja-style vibe with yellow rally wheels, 30-inch Mickey Thompson tires and suspension upgrades by King. Ford also showed off a number of Mustangs and F-150s it will have at SEMA, which kicks off November 5th in Las Vegas.

NASCAR CAMARO GETS NEW DESIGN
Team Chevy is going to replace it’s NASCAR Camaro ZL1 with a Camaro ZL1 1LE for the 2020 Cup Series. Chevy created a track-themed monster by adding on to the existing ZL1, so it’s no wonder it’s modeling the next Cup car after it. The production and road-legal 1LE gets an upgraded aero kit and drops by 50lbs.

WOMEN AT HIGHER RISK IN CRASHES
Vehicle safety is too male-focused and it’s putting women at risk. That’s the conclusion of a recent Consumer Reports story. Men are currently represented by a 5-foot 9-inch, 171-pound crash test dummy that was first standardized in the 70’s and was a reflection of the average male of the time. A female dummy wasn’t added until 2003 and it’s a scaled down version of the male dummy as well as only representing the smallest 5% of women by mid-70’s standards. What’s more, the female dummy only sits in the driver’s seat for some side-crash test, the rest of the time it sits as a passenger or isn’t used at all. The design of vehicle structures are influenced by safety testing and because women aren’t a focus, they’re being put a greater risk during crashes. A study from NHTSA shows that women wearing a seat belt are 17% more likely to be killed in a crash than a man and another study from the University of Virginia found that seat-belt wearing women have 73% greater odds of being injured in a front crash than a man. We say, it’s time for a change.

WHAT POWERTRAIN IS BEST FOR AVs?
GM and Ford are taking a very different approach when it comes to the type of powertrain powering their autonomous vehicles. Ford is using hybrids because of the amount of electricity needed to run the technology. GM on the other hand, is using all-electric Bolts for its Cruise ride-hailing service. So which approach will win out? Recently on Autoline This Week, we were joined by two experts on autonomous technology and here’s what they had to say.

(Clip from ATW #2324 can only be viewed in the video version of today’s show.)

You can watch that entire show on our website, Autoline.tv or you can find it on our YouTube channel.

Now it’s time for You Said It where I respond to some of your comments. A few of you accused us of anti-Tesla bias when we reported that Tesla’s third quarter earnings dropped.

Dave Borinski says “More Tesla FUD. Ignorance or intentionally misleading? Sure US sales declined between 3Q19 and “a year ago”. No Model 3s were being shipped to Europe or China a year ago so all production was sold in NA. Now, all production is being sold but split between multiple continents. Obviously that will result in lower US sales. Very poor reporting Autoline.”

Dave, good point. Tesla has boosted sales overall. And you’re right, it did ship cars to China and Europe. But we also believe it had to. This suggests that demand in the US is softening. We’ll get a clearer story of what’s going on once Tesla opens its assembly plant in Shanghai and no longer has to divert U.S. made cars to China.

Jay Jay is of the same mind. “Poor journalism on Tesla. The reason Tesla’s revenue dropped in the US is because they were shipping cars to other markets! They are selling every single car they can make. Demand is massive in every market for the Model 3.”

Actually Tesla’s revenue did not just drop in the U.S., it’s total revenue dropped by $776 million. So how did Tesla manage to post a profit even though revenue dropped? It cut its selling expenses by closing stores. It cut its administrative costs party with layoffs. And it cut how much money it spends on research and development. EVen though that helped it’s operating profit dropped 37% and its net profit dropped 40%.

Lawnmowerdude is still very bullish on Tesla. “Tesla will sell more in the USA once they have a small SUV like the Y available. The most popular segment.”

We agree. With more models in its lineup Tesla has a better chance of appealing to more customers, especially in the crossover segment. The only question is, how many sales will the Y steal from the 3? Total sales will go up, but there will be some cannibalization.

Thanks for all of you who participate in the comments section on the Autoline website and on our Youtube channel. But that brings us to the end of today’s report, thanks for watching.