On today’s show…Trump’s MPG freeze will lead to fewer electrified cars…last week it was Tesla, this week the Saudis want to invest in another EV car company…and Robert Wickens survives a wicked accident in IndyCar racing. All that and more coming right up on Autoline Daily.
This is Autoline Daily the voice of the automotive industry.
MPG FREEZE WILL LEAD TO FEWER EV SALES
What’s going to be the impact of President Trump freezing fuel economy standards? Autoforecast Solutions has done some forecasting on this and it says there will be 400,000 fewer electrified vehicles sold in the U.S. by 2025. It also predicts that foreign automakers will now start making more crossovers in their U.S. plants instead of passenger cars. And it points out that Trump’s higher import tariffs on steel and aluminum have led GM, Ford and FCA to put out warnings that their profits will be lower.
CAR SALES RED HOT IN RUSSIA
Despite economic sanctions on the country, the Russian car market is red hot. Sales in July were up 10% and through the first seven months of the year, automakers have sold just under one million light vehicles, which is a 17% gain. AutoVaz, is by far and away the largest OEM in Russia. But we were shocked to see Kia at number two, with a solid lead on the Volkswagen Group. Hyundai is right on the heels of VW and Renault rounds out the top five largest OEMs in Russia.
| RUSSIA 2018 LIGHT VEHICLE SALES |
| July |
143,452 |
+10.6% |
| YTD |
992,673 |
+17.0% |
| TOP 5 OEMs |
| AutoVaz |
199,273 |
+19.5% |
| Kia |
129,722 |
+28.0% |
| VW Group |
103,844 |
+22.7% |
| Hyundai |
102,399 |
+23.1% |
| Renault |
81,362 |
+13.3% |
| Source: WardsAuto |
GM EXPANDS IN UZBEKISTAN
General Motors has sold off its operations in Europe, stopped manufacturing cars in Australia, Russia, Indonesia, Thailand and South Africa, and stopped selling cars in India. But now it’s increasing production in an unlikely area…Uzbekistan. GM currently makes 10 models in the country, which translates to sales of about 135,500 vehicles. As part of the expansion, the automaker will add a new version of the Chevrolet Tracker, as well as a new generation of the Cobalt. The move could help GM grow its awareness in expanding markets like the Middle East and Africa.
Robert Wickens is one lucky IndyCar driver and we’ll tell you more after this.
WICKENS SURVIVES WICKED CRASH
In racing news over the weekend, Alexander Rossi’s Honda-powered car dominated the IndyCar race at Pocono motor speedway in Pennsylvania. But the race was marred by a horrific accident when Robert Wicken’s car was launched into the catch fencing, spinning it violently and flinging the wreckage back on the track. Wickens is in the hospital with multiple injuries and will probably have to undergo surgery as part of his recovery.
BMW M8 WINS 1ST RACE
In IMSA racing, BMW took its first win with its M8 race car at the Virginia International Raceway in the GT Le Mans category. The twin turbo V8 survived a race that turned into something of a crash-fest. Another M8 finished third. We say, congratulations to BMW for the win and also because that is just one sweet looking car.
LUCID MOTORS IN TALKS WITH SAUDI WEALTH FUND
Electric vehicle startup Lucid Motors could soon get a large financial shot in the arm. Reuters reports the Saudi Arabian sovereign wealth fund is in talks with Lucid that could see it invest more than a billion dollars. And that could be bad news for Tesla. Elon Musk has said the Saudi fund could help with the finances needed to take Tesla private. But it seems like the Saudis want to keep investing in new areas. It already owns a stake in Tesla, is now going after Lucid and we would expect it to continue to do more of the same.
Coming up next, most people go to auto shows to look at the cars. But sometimes the displays can be just as interesting.
CREATING AUTO SHOW DISPLAYS
On last week’s Autoline After Hours, we were joined by Craig Erlich from the company George P. Johnson, which is well known for creating auto show displays. And in the following clip, he discusses that there’s a lot more people than you’d expect helping to make the displays.
(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 just look for it on our YouTube channel.
But that’s it for today, thanks for watching and please join us again tomorrow.
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Comments (15)
August 20th, 2018 at 11:39 am
Forecasts: Those who gaze in crystal balls eat broken glass, in the vast majority of cases, but today’s forecast is particularly ludicrous. It just says they will sell “400,000 FEWER” EVs. So how can you hold this forecaster accountable, even after the actual numbers of EVs sold come out eventually? Whatever they may be, the forecaster can say, with a straight face, “That’s right, we predicted it, and it was 400,000 fewer than if…”
B.
August 20th, 2018 at 11:43 am
Russian Car Sales: The correct title is NOT that they are.. ‘red hot’ just because they went up 10% (after falling who knows how much for years), but that they are TINY, VERY TINY at less than a million for 7 months, or less than 2 million a year. Are you kidding me? Even California has more car sales than Huge Big Russia!
On the contrary, China has already topped the US market as the biggest new car market in the world, by many millions of vehicles, and they are not the cheap junk most Russian sales are.
(Russian Sales- 2 mill a year at best, US Sales- more than 17 mill a year, China sales, 30 mill a year.)
AND despite the failed forecasts, these numbers will only GROW in the future. We’ll be here to check them out.
August 20th, 2018 at 11:48 am
Lucid: You are making a huge deal out of mere meetings being underway. Wait until they reach an agreement, and even then agreements can be canceled…I’d bet the Saudis do not waste their money on one of the 99 EV makers that will fail, but will invest it with the one who has succeeded. (Hint: TESLA)
August 20th, 2018 at 11:51 am
Sean, does Kia build cars in Russia, or are all of their Russian sales imported?
August 20th, 2018 at 12:35 pm
@Kit – Kia makes a number of models in Russia under contract with a automobile manufacturing company named Avtotor. From what I can find, the Picanto, Rio, Optima, Stinger, Quoris, Soul, Sportage, Sorento and Mohave are all made at the Russian facility. Avtotor also makes vehicles for BMW, GM and Hyundai.
August 20th, 2018 at 12:39 pm
@ #4… Depends if you want to call Sovakia a Russian Plant. It is one of few plants where multiple models can be built on the same line. 8 I believe.
August 20th, 2018 at 12:49 pm
With cars in Russia rebounding, that certainly is good news (for them); perhaps Red Hot is a little optimistic (but does get the point across and isn’t incorrect).
And the forecast that electrics will be fewer (by what-ever number); that is just an arbitrary comment as there are so many other variables (including the said moratorium on fuel standards) that it would be impossible to link what to which. Well, at least not a specific number (of sales).
August 20th, 2018 at 1:03 pm
5 Thanks for the info, Sean.
August 20th, 2018 at 1:14 pm
The Autoforecast Solutions prediction is fewer “electrified” vehicles. I assume that includes hybrids and plug-in hybrids, as well as pure EV’s. That forecast seems quite plausible, since OEM’s won’t make as many hybrids to increase their CAFE numbers. Of course, the car companies need to plan for the future, because Trump will be gone, fuel prices could increase drastically, and buying patterns could change for other reasons.
One change that could greatly increase sales of plug-in vehicles, would be a large decrease in battery prices. If battery prices go from the current >$200/kWh, to $50/kWh, electric commuter cars could be sold for under $20K. I suspect there would be a big market for such vehicles.
August 20th, 2018 at 2:18 pm
10% would be impressive and consequential if it was for the huge US or Chinese markets, but the Russian market is a tiny less than 2 million a year market, smaller than just California, and I bet the average price is much lower than cars sold in CA, given the many low-priced Russian-made models in the sales numbers given here.
August 20th, 2018 at 5:29 pm
EV technology continues to advance, rapidly, and Tesla has already conquered luxury sales. The smarter manufacturers are introducing their luxury EVs but late. Worse, they are pointed at where Tesla already stands.
In contrast, Tesla is expanding their product line in new areas. Their EV semi is already shuttling between Reno and Fremont. The roadster should undercut the supercar market and the Model Y will fill the sedan void. Then there is the pickup.
August 20th, 2018 at 6:30 pm
Tesla is, by far, the most successful “upstart” car company since WWII in the US, and maybe in the world.
As far as technology, EVs are mature technology, except the batteries. Anything that makes batteries drastically cheaper, or higher energy density, or ?, could change things completely, as far as EVs competing with ICEs.
August 20th, 2018 at 6:41 pm
In spite of the SUV craze, luxury cars still work to establish a brand. Mercedes started long ago with cars. Then, Lexus became established, and respected, with th LS400. Now, Tesla got “on the map” with the Model S that looks like a sedan, but is even better, because it’s a hatchback.
August 21st, 2018 at 2:53 am
13 I know you want to label it this way, but the Tesla S is not really a ‘hatchback’ in the sense the American Buyer understands the word, and this is why they can charge $100k for it, and not $20k, which is what buyers expect to pay for a hatch.
The Tesla S looks less of a hatch than even the Porsche Panamera, which is its closest (in shape), yet the S can take 2 extra passengers for a total of 7. I know of no cheap or expensive hatchbacks that can do that.
You can also call the Audi A7 and even the merc CLS (which I never thought was cute, but a ripoff) a ‘hatchback’ but buyers will not.
August 21st, 2018 at 7:37 am
14 The Tesla S is a hatchback, in the same way a Panamera, Prius, current Buick Regal, A7, 4 series Grand Coupe, and VW Golf are hatchbacks. Do you not know the definition of hatchback. “Cheap” is not part of that definition.
Yes, as I said, the Tesla S LOOKS LIKE A SEDAN, a good thing in that market segment.