AD #3072 – April Sales Stronger Than Expected; BMW Making Fuel Cell X5s; Chip Shortage Drives Up Used Car Prices

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

APRIL NEW CAR SALES STRONGER THAN EXPECTED
Kabam! New car sales came in stronger than anyone expected in the American market last month. Wards Intelligence had forecasted that the SAAR, or seasonally adjusted annual rate, could come in at 18 million. Instead it came in at 18.5 million. In March it was at 17.9 million, so the market is gaining strength. Despite low inventory and a chip shortage, car dealers sold 1.5 million vehicles.

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U.S. Sales April, 2021
SAAR	18.5 Million
Sales	1.5 Million

Sales were up 111% compared to a year ago, but let’s ignore the year ago comparisons because that was in the middle of a pandemic. On a month over month basis sales were down 5.5% compared to March. That may sound confusing since the April SAAR was up compared to March. That’s because March’s sales came in higher than they normally do for that month.

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Sales Gainers
Porsche	6,800	+25.3%
Volvo	11,270	+11.0%
Kia	70,180	+5.5%
Honda	156,480	+5.3%
Hyundai	80,800	+3.1%

The only automakers that gained sales were Porsche, Volvo, Kia, Honda, Hyundai and Volkswagen. Hyundai and Kia were helped by the fact that they never cancelled their chip orders last year, so production was largely unaffected. The automakers that dropped the most were Mitsubishi, Tesla, Nissan, and Jaguar Land Rover. Passenger cars accounted for 23% of sales, while trucks accounted for 77%. Sales of electric cars fell 25% to just under 32,000 BEVs. That’s because Tesla’s sales were down so much, but that usually happens at the beginning of each quarter. Tesla always sees a big sales surge at the end of each quarter, so we expect it to make it up by the end of June.

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Biggest Drops
Mitsubishi	6,600	-50.3%
Tesla	20,000	-32.6%
Nissan	97,500	-24.4%
JLR	9,000	-10.7%

BMW MAKING SMALL BATCH OF FUEL CELL X5s
More investment continues to go into fuel cells. BMW announced it’s going to produce a small series of hydrogen-powered SUVs, based on the current X5. They’ll be called the i Hydrogen NEXT and are scheduled to come out sometime next year. It features the same electric motor as the iX3, which produces 275 kW or nearly 375 horsepower and is mounted on the rear axle. BMW didn’t reveal the battery size or range, but the vehicle is equipped with two tanks that combine to hold 6 kilograms of hydrogen. That’s a full kilogram more than the Toyota Mirai, which has a range of more than 400 miles. But as most of us know, fuel cells will never catch on unless a lot more refueling stations are built, which is going to take time and money. That’s why, like all companies investing in fuel cells, BMW is also calling on governments to help build out the infrastructure.

ZF’S MIDDLEWARE SOLUTION HELPS INTEGRATE HARDWARE & SOFTWARE
There’s no doubt vehicles are more complex than they used to be, so we need better, faster and smarter tech. So, the supplier ZF is launching a new middleware solution, which is an open software program that’s key function is ease communication between hardware and software. This simplifies integrating new hardware and software solutions into a vehicle and that cuts down on development time as well. This is good for things like autonomous systems because the data for the cameras, sensors and lidar are combined into one location, which speeds up communication and improves safety. ZF says its middleware solution will be available in vehicles by 2024.

CHIP SHORTAGE DRIVING UP USED CAR PRICES
Used car prices are at historic highs but hold onto your hat because they’re going even higher. The average price of a used car is now over $22,000, and they’re setting all-time records. You can thank the chip shortage. Inventory is so tight for new cars that the car rental companies can’t get enough of them. So now they’re buying used cars, something they have never, ever done before. And that is sending prices soaring. Prices for used cars at auction are now 50% higher than a year ago. Bloomberg reports that vacation and business travelers will be paying record rates to rent cars. They can run $100 a day in Florida, $200 a day in Hawaii and $600 a day in Puerto Rico.

GENESIS BRAND JUST NOW ENTERING EUROPEAN MARKET
Hyundai’s luxury brand, Genesis, is making its way to Europe. The company announced it will start selling its vehicles in the UK, Germany and Switzerland this summer. The G80 and GV80 will be the first models available followed by the G70 and GV70. Three battery electric models will also be introduced within its first year in Europe, including the electric G80 revealed last month. Genesis will sell its vehicles both online and at retail studios.

SAE UPDATES ITS LEVELS OF AUTONOMY
Since its introduction in 2014, the SAE’s Levels of Driving Automation or what’s officially called SAE J3016, have become the industry standard for categorizing different automated systems. The levels range from no driving automation at Level 0 to full driving automation at Level 5. But the technology has evolved since then so the SAE updated its Levels to include new terms along with refinement and clarification to clear up misconceptions. Some of the notable updates include more clarity on the differences between Level 3 and Level 4, including the role of the fallback-ready user, the possibility of some automated fallback at Level 3 and the possibility of some alerts to in-vehicle users at Level 4. Level 1 and Level 2 are now referred to as “Driver Support Systems” while Level 3 through 5 are called “Automated Driving Systems.” And if you want to check out all the changes just click the link in the transcript or description box.

HOW ARRIVAL’S MICRO FACTORIES ARE DIFFERENT
As you all know, most vehicles are built in giant assembly plants that take years to build at a cost of hundreds of millions if not billions of dollars. But UK commercial EV startup Arrival, is pioneering what it calls micro-factories to manufacture its vehicles. It says it can setup a manufacturing site in a warehouse in just six months at a cost of $40 to $50 million. Mike Abelson, the CEO of the company joined us on Autoline After Hours and explained how its micro-factories are different from traditional ones.

“The micro-factories are very different inside. We don’t use sheet-metal stampings in the micro-factory at all, our panels are a proprietary composite material and that’s important because it uses a low-pressure process and it uses in-mold color. So if you’re familiar with a traditional assembly plant, we don’t need a press shop and we don’t need a paint shop. And our analogy to the body shop doesn’t use any welding, it uses adhesives and mechanical fasteners. And then throughout the whole micro-factory, as you well know, a traditional assembly plant is built around an assembly line, which is essentially a serial process, every vehicle goes through the same stations in the same order and same speed, day after day, week after week. When I referenced software earlier and on the videos on the screen, you saw these little wheeled robots rolling around. We use those robots, which we developed in Arrival, we use those robots to carry parts as well as carry vehicles. And they don’t follow a prescribed path, the manufacturing cells are set up and the software controls what order the mobile robots go to which cells and which parts get delivered to which cells. So it basically gives us an infinitely flexible way to link the cells together, which gives us a lot of flexibility in maximizing the utilization of all the machinery as well as flexibility as what we build in the micro-factory.”

ARRIVAL SIGNS DEAL WITH UBER
And speaking of Arrival, it just signed a deal with Uber to develop a purpose built, electric vehicle for Uber’s drivers. Arrival will collaborate with the ride-hailing company’s drivers to make sure the vehicle fits their needs as well as their passengers. Arrival plans to reveal the final design of the vehicle by the end of the year and is aiming to start producing it in the third quarter of 2023.

But that brings us to the end of today’s show, thanks for watching.