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Runtime: 11:27
0:00 VW Could Cut 30,000 Jobs in Germany
0:53 Germany Says It’s Up VW To Be Competitive
1:10 Nio Interested in Buying Audi’s Belgium Plant
1:38 Mercedes Lowers Profit Outlook for Second Time
2:07 EU Auto Stocks at Near-Record Lows
2:55 Lucid Turns to Detroit For Help
3:29 Silverado & Tundra Beating Up F-150 & Ram
4:36 Ford & Kia Boost Exports Out of China
5:18 U.S. Invests More in EV Battery Supply Chain
5:59 GM Cruise to Resume Silicon Valley AV Operations
7:20 U.S. DOT Pushes V2X Technology
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This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
VW COULD CUT 30,000 JOBS IN GERMANY
As you probably know, things are not going well at Volkswagen. But just to give you an idea of how dire the situation is, the company is considering getting rid of 30,000 employees in Germany. That’s according to Manager Magazin, a German trade publication. Those layoffs would equate to 10% of VW’s employees in Germany and would include 4,000 to 6,000 R&D jobs. VW also plans to slash its capital expenditures by billions of euros over the next 5 years. But VW’s works council scoffs at that number of layoffs, saying they have no basis in reality. And so buckle up for what could be a major battle between VW and labor.
GERMANY SAYS IT’S UP VW TO BE COMPETITIVE
Germany’s economic minister says the government wants to help VW avoid closing plants in Germany. But beyond suggesting some incentives for EVs, he admits there isn’t a whole lot the government can do, saying it’s up to Volkswagen to structure the company to be competitive.
NIO INTERESTED IN BUYING AUDI’S BELGIUM PLANT
As we reported a couple of weeks ago, Audi is looking at closing an assembly plant in Belgium, and now media reports are surfacing that Chinese automaker Nio could be interested in buying it. That would help Nio avoid EU import tariffs on Chinese EVs. But we think if Nio decides it needs a plant in Europe, it will probably look to low-cost Eastern European countries, instead of high-cost Belgium.
MERCEDES LOWERS PROFIT OUTLOOK FOR SECOND TIME
The longer the year goes on, the worse things are looking for Mercedes-Benz. For the second time in two months it just lowered its profit outlook for the year. It’s also going to cut its capital expenditures as it expects its free cash flow to plummet. Mercedes is taking a beating in China, where it not only lags behind with electric cars, but now faces a backlash against any kind of high-end purchases that is affecting all luxury brands and not just cars.
EU AUTO STOCKS AT NEAR-RECORD LOWS
Put it all together and the stock prices of European automakers are at near-record lows. As a group, European auto stocks are now trading 60% below the overall Stoxx 600 Index. And some analysts believe those stock prices could drop another 10-20%. Maybe that’s why, despite the low prices, value investors are sitting on the sidelines, waiting for them to drop further.
LUCID TURNS TO DETROIT FOR HELP
Ford and GM have opened R&D offices in California to help develop EVs. But now, a Silicon Valley based EV startup is turning to Detroit to help develop its vehicles. Yesterday, Lucid Motors officially opened its first offices in the Detroit-area. It says it wants to tap into the local talent and suppliers as well as have access to the universities in the area. Lucid currently has 70 employees at its Detroit offices and it plans to boost that to 250 in the next three years.
SILVERADO & TUNDRA BEATING UP F-150 & RAM
If you had to put the top three full-size, half-ton pickup trucks in order of sales in the second quarter of this year in the U.S., I’d bet you’d probably say the Ford F-150 first, then the Chevy Silverado and third the Ram 1500. But that’s wrong. The Toyota Tundra has been chomping away at sales of the Ram 1500 all year and in the second quarter it rose to 15.2% share of the full-size, half-ton pickup truck market, versus 10.1% for the 1500. The Tundra is up from 11.6% share in the fourth quarter of last year, while the Ram is down from 17.4%, which is a big jump for both in a relatively short amount of time. There’s likely a number of reasons for the rise of Tundra, but what do you think is the biggest factor? Also, if you thought the F-150 was in first place, you’d be wrong there too. The Silverado had nearly 29% of the full-size, half-ton pickup truck market in the second quarter in the U.S., two points ahead of the F-150.
FORD & KIA BOOST EXPORTS OUT OF CHINA
Ford and Kia are taking a different path to combat their sales slides in China compared to other foreign automakers. Both have lost hundreds of thousands of sales over a roughly 8-year period, so like many Chinese automakers, Ford and Kia are turning to exports. Kia’s exports were up 125% last year and they’re up 65% so far this year. Last year Ford set a record for the number of exports from its Chinese factories and they’re up 45% this year, including the Mondeo, Equator and Lincoln Nautilus. Ford also started building the Bronco and Ranger in China as it phased out low cost models.
U.S. INVESTS MORE IN EV BATTERY SUPPLY CHAIN
The U.S. is way behind China in developing a battery infrastructure, but it’s making progress. The Department of Energy is awarding $3 billion to 25 projects across 14 states, to upgrade, expand and build new facilities for processing minerals, battery components, battery manufacturing and recycling. The projects will cover traditional and next-gen lithium-ion chemistries, as well as non-lithium-ion technologies. The Energy Department says its investment will generate $16 billion in total investment for the projects and create 12,000 construction and production jobs.
GM CRUISE TO RESUME SILICON VALLEY AV OPERATIONS
GM’s autonomous unit Cruise is heading back to the area of its most famous accident where one of its vehicles dragged a person that was hit by another vehicle. The way the incident was handled and the subsequent investigation into the company resulted in a complete shakeup of Cruise, including the departure of the CEO and co-founder. But now it’s headed back to the Bay Area of California with a small number of vehicles for testing. Five autonomous Chevy Bolts should be running around Sunnyvale and Mountain View by the fall. The company also launched test vehicles with backup drivers in Arizona in April. Now its plan is to restart fully autonomous test rides by the end of the year and then start charging customers early next year. But the shakeup at Cruise is also having an impact on GM’s partnership with Honda. They planned to test the Origin Shuttle this year in Japan and then launch a service in 2026. But GM has stopped production of the Origin and will focus on AVs developed off the Chevy Bolt instead. That means Honda isn’t testing any Origins in Japan right now and says it’s “currently examining the impact of the project.” It wouldn’t say if there’s any changes to the plans, but did add that it wants to start a robotaxi service in Japan as soon as possible.
U.S. DOT PUSHES V2X TECHNOLOGY
V2X technology, which allows cars to talk to each other and the infrastructure like traffic lights could be the biggest breakthrough in automotive safety ever. So, last month the U.S. Transportation Department proposed to equip three-quarters of the intersections in the country with V2X tech in about 12 years. The technology allows vehicles to wirelessly communicate with other vehicles on the road or with the road infrastructure to transmit speed, location, road conditions and other info. It can almost make it impossible for cars with V2X to crash into each other, and it allows cities to manage traffic flow more efficiently. While the technology is ready to go, it hasn’t been deployed on a widespread basis in cities. So, automakers haven’t had much incentive to equip vehicles with the technology. An analyst at ABI Research estimates that 70% of vehicles need to be equipped with V2X to have a 50% chance of effectively communicating with other cars and the infrastructure. And that’s why the Transportation Department is pushing to make it more widespread.
But that brings us to the end of today’s show. Thanks for making Autoline a part of your day and I hope that you have a great weekend.
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Interesting that Tundra is doing so well. I like certain Toyotas, the 4 cylinder hybrids, but if buying a big pickup, it would probably be a Silverado. Maybe the Chevy is doing better than Ford and Ram, because pickup buyers still want V8 engines. Could Ram sales be down because buyers want a “hemi,” even though the new six probably performs better and gets better mpg than the outgoing 5.7 V8?
Lucid is learning that the Detroit area has a variety of shops and talent to build tooling and equipment specific to the auto industry. Not that talent can’t be found elsewhere but the sheer number of suppliers and integrators in the area is why it’s called the motor city.
Kit- Only from personal experience what I hear is from truck buyers is yes, the tried-and-true V8 is a solid performer that can reach 200K+ miles easily while the smaller turbo engines cause some hesitation to those buyers that plan to keep their truck and run it into the ground. Not sure the confidence is there for the turbo or turbo engine to last as long. Upping the compression with forced induction does increase the stress on the internal components and what you gain in fuel economy you may sacrifice in longevity. However, Ford does seem to be performing well with their eco-boost engines but that doesn’t mean the public confidence is there yet. Too early to tell with Ram.
Kit, Ford has self-inflicted woes related to F-Series. They delayed shipments a long time for after-build quality checks. This frustrated customers who grew tired of waiting for their new truck. Of course, Ford’s General poor quality malaise is probably chasing some customers to the thermal nuclear ugly Tundra.
One would think that Toyota having to replace 102,000 engines in their 22 and 23 Tundra pickups would give buyers pause. I think the Ram issue really boils down to pricing. They raised their prices a LOT during the pandemic when they had production and GM and Ford were struggling to build pickups. When they launched the new Ram 1500, it came with no V8 option, a new, unproven and thirsty V6 turbo, and a sizable price increase. They have not been open to a price reduction and are trying to build sales volume with better lease deals and dealer cash to assist cash or financing buyers. With Ford having some quality struggles and the king of recalls for the third year in a row, Chevy and GMC with their proven V8 engines and relatively good quality appear to be the current winners. They are also willing to wheel and deal a little to press their advantage and achieve a rare market share gain. And, the bragging rights of outselling the F-150, even if its only for a short time.
Ahh, the poison pill of “diesel gate”.
Drew, yeah, maybe people turned off by Ford for various reasons still want turbo V6s, and Tundra has them.
GM Veteran, the Ram has a turbo inline six, not V6, and from what I’ve read, it is quicker and less thirsty than the V8 it replaces. Yeah, durability is a big unknown.
I know a number of people with pickups, most of which are Chevy and GMC. Some keep them a long time, and some get new ones every few years. If Chevy and GMC sales were combined, GM pickups would have frequently outsold F series, but since they keep both brands, Ford has decades of pickup truck “bragging rights.”
Great week of autoline,and some great comments as well
Sad to see that yet again, bad decision at the top, this time at VW, is being taken out on the workforce! From dieselgate, the craziness with their software issues and some would even say their move to EVs (personally I’m not one of them). With the number of ‘bodies’ that has been suggested of laying off, couldn’t they save as much money by removing the high dollar executives that made the decisions bad from the top?! Of course that will never happen and laying off personnel to right size the company, will make the stock rise and put more money in those executives pockets.
Another VW problem is awful operator interface, on the current version of what is historically their best seller, Golf. CR and Car and Driver agree that the infotainment of the current GTI is awful, and that is probably the case with “garden variety” Golfs where they sell them. VW needs to leave awful operator interfaces to Tesla, and use simple, user friendly controls on Golf, and on VW’s EVs.
I would what is actually at issue with software for their EVs? The infotainment is one thing, I don’t think that it’s the EV’s operating systems for, if it were, they wouldn’t have the EVs on sell that they do! I don’t think that it has to do with their EV’s efficiency either, as as being the MOST efficient has not not stopped OEMs with either IC engines, hybrids, PHEVs or full EVs. Personally, I think that it has something to do with their autonomous driving aspirations and attempting to keep up with Tesla and other, especially, Chinese automakers. Yet, to date nobody has level 5 autonomy and of those who do have some level of it, including Cruise and Waymo, how saturated is the market? Most vehicles, ICE or EV, sold today do not have or use any type of self driving systems, so if their next vehicles were sold without them, I don’t think that would be a deal breaker for their vehicles. I say that to say that, when you look at all the money they have lost over their software issues, if autonomous driving was the big issue, how much that money would have been better spent elsewhere! Especially, as that aspect of they industry is still has a long way to go and a lot of maturing to do.
…but as the saying goes, ‘hindsight is 20/20’!
The thing I’ve heard about the current GTI is that the controls are just “unfriendly,” with too many menus to go through, and too few physical controls. I haven’t been in one, so have no actual experience. I thought about checking out a GTI before ordering my ’23 Mini, but I didn’t.
When you think about a vehicle from say 1980’s and all the controls they had, and today’s vehicles are multiples of that with a touch screen that allows us to not only interface a phone with tons of apps, but we can now program the vehicle to change up displays and things like how long the lights stay on after locking it. Then you add in all the extra features and sensors and access to them can create the need for multiple screens. Yes, many of those features are locked out if the vehicle is in gear. But there are still many of features that often times require you to navigate multiple screens. This is where the distracted driving comes in. Anytime you cannot just look over and touch a button to achieve what your after it requires a second or third screen is too much time with your eyes off the road. Having to look over scan the screen notice what you’re after isn’t there. Select a button to get you to the screen you want then finding the button you want or sometimes even having to go one more screen in is dangerous. Seems the manufacturers answer is to just make bigger screens. Try and get everything on one screen which makes sense once you’re familiar with the car. But until it becomes second nature a driver will now be scanning a much larger screen looking for the button to toggle the feature they’re after.
As many have mentioned here before some things should just never be a button anyway. Nothing worse than getting into a car that the last driver was jamming to the radio really loud, and you can’t simply give a twist to a knob and turn it down. Nope you need to push push push the down button to get the radio down. Same goes for the fan control. I like being able to quickly twist it too high or low and not have to push a button 4 times to get the speed I want. Designing all these features in a safe and accessible manner I’m sure has to be tough. As features increase its only going to get worse. Some manufacturers defiantly do a better job than others.
At least the HVAC and radio volume controls are pretty good on my current cars. Tuning the radio, beyond the presets, not so much.
Ford exporting out of China may be very short sighted. I’ve been pretty loyal to gm products over the years but I wouldn’t look at the Envision that is made in China. That left me only the Tourx, made in Germany, which I am very happy with. I can’t be the only one who tries not to buy from China when I can avoid it. Building in China may offer more profit per unit but I think it can turn people away from the brand. Just my $.02.
I suspect a lot of Envision buyers (and Nautilus buyers) don’t even know their vehicles were made in China, even though the window sticker would say so.