Annnnnnd we’re back…AutoInfluence easing the month of May right out the door with this week’s current automotive news headlines. But first, let’s address the elephant in the room, the rumored merger of Ford and General Motors.
Unless you’re living under a rock, those of you who follow our weekly headlines in real-time are bound to have seen stories regarding FCA’s proposed merger with French automaker, Renault. We’ll get back to that in a bit, but discussion of that development seems to be fueling an inordinate amount of rumors regarding the potential of a reactionary merger between Ford and GM. Setting aside the endless buzz and relentless speculation, let us just say it again for the people in the back: this is not a real story. At least not now. Neither Ford or GM have declared their intention to join forces. And now that we’ve gotten that out of the way, let’s get on with the real news.
Ford
The Mustang has been a hot-button topic of conversation this week: first, in regard to justifying a difference in fascia when comparing the 2019 Mustang against the Shelby GT350 & GT500; and second, in regard to a questionable price increase for the limited edition 2020 Bullitt.
So, let’s talk about those front end differences. Having previously been written off by Ford’s statement that “the Shelby GT350 is the purist’s performance model” and that the team at Ford “focused their time addressing what customers wanted most”. Well, that’s a super-convenient way to avoid an explanation. Fortunately, it was further clarified that the Shelby models are fitted with a different front subframe, a Carbon Composite designed to stiffen the chassis and to reduce weight. In addition both the GT350 and GT500 are designed to accommodate special cooling and airflow needs. To re-engineer the design in order to align them with the 2019 would be costly and wasteful. Okay. That’s a much better answer.
That said, it’s been mentioned (more than once) that the appeal of Shelby models have compromised standard Mustang sales, with last year’s reported pony car sales ranking as the worst since 2011. Similar patterns have continued through Q1 of this year, echoed in some form or fashion across the entire segment. That said, Ford has received some criticism for implementing a $1215 price jump on the special edition Bullitt. While definitely one of our favorites, the fact that there’s no new kit to justify the price increase (on what is already a near $50,000 car, to start) feels a bit short-sighted. And judging by the number of articles we’ve seen with Ford being called out for it, we’re hardly alone in that opinion.
GM / Chevy / GMC / Buick
GM has announced they they will be investing another $24million to upgrade their Fort Wayne IN manufacturing facility, in order to increase production on both the Chevy Silverado and GM Sierra 1500 models. With sales up 20% over Q1, GM aims to meet growing customer demand, a goal that has remained at the forefront of the automaker’s focus with over $1.2 billion invested in the plant since 2015. And that number is only a smart part of the $23 billion that GM has invested in U.S. manufacturing since 2009.
Another announcement comes in the planned resurrection of the midsize Chevy Trailblazer for 2021, following it’s retirement after 2009. Slotting in between the Trax and Equinox (and priced accordingly) the unibody Trailblazer will be built on GM’s VSS small- SUV platform. The same could also be said for all-new Buick Encore GX, also announced this week. The Encore GX will find its home between the subcompact Encore and the compact Envision, and will become the brand’s fourth crossover.
Turning attention to the 2020 Silverado, Chevy let the cat out of the bag regarding available powertrains this week. Specifically, the introduction of the all-new 3.0-liter Duramax TurboDiesel which will be available on LT, RST, LTZ and High Country models. Serving up 277hp and 460 lb-ft of torque it will be one of the seven available engines. Also new, is the inclusion of the 2.7-liter Turbo, standard in the LT and RST models, and optional in the custom.
FCA / Dodge / RAM / Jeep
Which brings us back to, arguably, the biggest news of the week – FCA’s $40 Billion proposed merger with Renault, the French automaker best known stateside for their ownership of Nissan, Mitsubishi and Infiniti. Served up as a 50/50 split, the historic merger would create an 11-seat board split between the two automakers, and would place the new entity behind Toyota and Volkswagen as the world’s third-largest automaker, with nearly 8 million vehicles sold annually. It would also unite Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Fiat Professional, Jeep, Lancia, Maserati, RAM, Infiniti, Mitsubishi and Nissan under the same umbrella. If all parties involved decide to move forward, it’s expected that the merger will take 12-18 months to facilitate.
Honda
Honda has announced that the highly-anticipated (and recently named) Honda E will actually defy predictions by including (as a standard feature) the side-camera-mirror system as part of the actual production models. Pumping a live camera-feed of rear traffic to two dash-mounted screens, the intention is to improve visibility, while minimizing driver distraction. The view can be adjusted to extend or reduce the field of vision, and can reduce blind spots by up to 50%. That said, the design has benefits in terms of efficiency as well, reducing drag by 90% (when compared to traditional side-mounted mirrors) while offering a 3.8% improvement overall.
Renault / Nissan / Mitsubishi / Infiniti
Tying back to the earlier discussion of the proposed merger, FCA executives have requested the opportunity to meet with Nissan and Mitsubishi leaders with the intention of discussing the proposal. With Nissan President and CEO Hiroto Saikawa and Mitsubishi Chairman and CEO Osamu Mask having already met with Renault Chairman Jean-Dominque Senard on Wednesday, a meeting with FCA Chairman John Elkann seems both timely and appropriate. While Nissan has voiced that they were “not opposed” to the suggested merger, they also specified that there was “a lot to talk about”. Of course, a key topic would be each company’s role and relationship within the restructured organization. That said, its worth noting that Nissan doesn’t currently have voting rights in Renault’s decision, despite their 15% stake. This would, however, be remedied based on the wording of the proposal, as it currently stands. Renault of course, would benefit through exposure to the American marketplace; while FCA would bring their premium products to all new markets, and both would gain long-sought opportunities in China.
And after a six year stay in Hong Kong, luxury-brand Infiniti has initiated a pilgrimage back to Japan to “promote greater efficiencies and enhance collaboration with the core brand”. One of the major areas of focus, according to insiders, will be a focus on electrification with the intention of becoming an EV-focused brand, beginning in 2021.
Mazda
Owners of Mazda6 produced between 2011-2013 should be aware of a pending recall, applicable to any owners who operate their Mazda6 in “seasonal salt use states”. The recall, prompted by insufficient paint coating on the front cross member draws attention to (i) a risk of corrosion in the event of extended exposure to salt (ii) concern of deterioration and (iii) potential breakage or reduction in steering control caused by high-speed travel over potholes.
Tesla
Despite the expectation that global sales will be increasing (especially in China, where local production can be employed to help control cost) dwindling U.S. interest regarding the Tesla 3 has placed Elon Musk’s upstart automakers in Wall Street’s crosshairs. Brian Johnson, an analyst for Barclay’s is the latest to communicate a belief that Tesla is “stalling as a niche automaker” due to “stagnating demand in the U.S.” That said, Johnson is a mid-ranked analyst who has been traditionally anti-Tesla in his transactions – but his recommendation that Tesla focus on “fundamentals of demand, profitability and cash generation” seems to be echoed by plenty of his peers. Not that Elon Musk is listening. And with the kind of unprecedented operational autonomy that Tesla has been all-but guaranteed by the Chinese government in terms of operating his Gigafactory 3, whose impending completion will allow Tesla to service a 2-million unit premium market, it feels both penny-and-pound foolish to bet against Tesla.
VW Group / Volkswagen / Audi / Porsche
With the push for electrification full-steam ahead for most automakers, companies who have made sweeping declarations of a fully electric future are finding themselves hindered by restrictions in battery supply. And VW is no exception. Consider the recently unveiled ID.3 which met with 10,000 preorders within the first 24 hours. Now consider the fact that VW’s negotiations with Samsung have resulted in an estimated 75% reduction in the battery yield they can offer per year. This means that VW would only receive about 5x what they’d need to accommodate preorders alone. With a need of approximately 300-gigawatt hours worth of batteries to be produce each year, VW has expanded their supplier search on a global scale – while continuing R&D on solid-state batteries, alongside Audi’s experimentation with hydrogen fuel cells.
And here’s one for our European listeners, specifically those who are fans of Audi. Beginning June 5th of this year, you’ll now be able to purchase an Audi online! Beginning with the Audi TT Quantum Gray Edition, Audi is establishing this supplemental e-commerce pillar to support that of traditional brick and mortar sales. That said, it’ll be interesting to see how (and if) this plays out on a larger scale.
Over at Nurburgring, spy shots were captured of the 992 generation of the Porsche 911 GT3. Powered by a tuned variant of the 4.0-liter flat-six engine, output is expected to fall in closer to the 520 horses currently wrangled by the GT3 RS. We’ll be looking forward to the unveiling, which is likely to be in Frankfurt later this year.
And while there’s been no formal comment made by Porsche, a mid-day raid of their offices facilitated by 176 police officers and 10 lawyers was made public, declaring investigation surrounding allegations of ‘bribery’ and ‘breach of fiduciary trust’. Little-to-no information has been revealed other than the fact that one individual “is being probed on suspicion of having leaked confidential information to a tax advisor of Porsche AG in exchange for receiving favors”. We’ll follow up further on this as details becomes available.
Jaguar / Land Rover
With an Investor Day scheduled for next week, JLR finds themselves under some scrutiny after reporting an extra $1Billion of free cash flow – contrasting the aggressive cash-burn rate that they’ve experienced over the last two years, and which sparked their aggressive restructuring strategy. And while that surge in cash is the result of an aggressive working-capital management strategy, the long-term viability of JLR is questionable at best.
But, as previously reported here at AutoInfluence, JLR has been heavy-handed with their R&D pours – and leaked information regrind the long-promised, next-gen 2020 Defender seems to indicate their intent. With the expectation of a September reveal at the Frankfurt Motor Show, JLR plans to challenge the Mercedes G-Class, in the hopes of redefining themselves as a modern global player.
And in the more obscure areas of technological development, let’s talk about the heated steering wheel. Nothing new, right? Well JLR believes they’ve solved the problem of distracted features, in the form of a steering wheel that prompts drivers to turn, using a temperature change. Looking to split the difference between passive voice notifications and jarring vibrations cues, the sensory wheel is being pitched as a practical solution. That said, this is the same company who planned to put Googly eyes on an autonomous vehicle to make it less scary. So….
BMW
This week, BMW announced an update of the BMW X1 Sports Activity Vehicle for 2020. Starting with the exterior, updates include a full restyling to mirror the aesthetic of the X3, 5 & 7. This includes updated wheel design, new LED headlamps and L-shaped taillights, and a fresh take on the kidney grille as well as the front and rear bumpers. the addition of three colors (i) Storm Bay Metallic (ii) Jucaro Beige and (iii) Misano Blue Metallic (alongside the discontinuation of Estoril Blue). The most notable updates to the cabin experience include a two-tone “X1” LED welcome projection and decorative contrast stitching.
And that about wraps things us for this week’s automotive news, and for the entire month of May. That means that – Dad Jokes aside – we won’t see each other again until next month. And with humor like that, it’s easy to see why I always ask you to say hi to your mom for me.
