AD #2605 – Tesla to Update Model S, Ferrari Reveals Its First PHEV, U.S. Could Carry Brunt of FCA & Renault Merger
May 30th, 2019 at 11:45am
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Runtime: 7:22
0:07 China Could Restrict Rare Earths
0:45 Tesla Model S Update Coming
1:12 Ferrari’s First PHEV
2:25 Chevy Confirms New Trailblazer for U.S.
3:06 Buick Confirms Encore GX for U.S.
3:37 Refreshed Lexus RX
4:45 U.S. Could Carry Brunt of FCA & Renault Merger
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CHINA COULD RESTRICT RARE EARTHS
The trade war with China is heating up. The Chinese government is now threatening to restrict sales of rare earth minerals to the U.S. which are used in a number of different car components. China dominates the global market for rare earths and accounts for 80% of U.S. imports. According to Reuters, there are three companies building rare earth processing plants in the U.S., one is expected to open next year but the other two won’t open until 2022 at the earliest. So if China does restrict sales, it would make it very difficult for companies to find different sources for rare earths.
TESLA TO UPDATE MODEL S
The Tesla Model S is a little long in the tooth but will soon be getting an update. CNBC reports it will get a full refresh, including a minimalistic interior, similar to the Model 3. It’s also gets the same seats as the high-end Model 3 and a battery that delivers 400-miles range, up from the current 370-miles with a 100 kWh battery pack. It should be out in September.
FERRARI SHOWS ITS FIRST PHEV
Ferrari is coming out with its first plug-in hybrid, the SF90 Stradale. It produces nearly 1,000 combined horsepower from a turbo V8 engine and 3 electric motors. Zero to 100 km/h comes in just 2.5-seconds. But the all-electric range is just a bit over 15-miles–not very impressive. The interior features an all-new steering wheel with a touchpad and a number of haptic buttons for controls. It also has the first application of a curved 16-inch display screen for the driver. And a first for customers–they’ll be able to choose from a standard version or a more sports-oriented model with race-inspired shocks, more carbon fiber and titanium parts and pieces, a different rear spoiler that creates more downforce and Michelin Pilot Sport Cup2 tires.
CHEVY ANNOUNCES ALL-NEW TRAILBLAZER FOR U.S.
Chevrolet may not be giving up on passenger cars, but it sure is going heavy with crossovers and SUVs. Right now it has 6 of those models in its line-up and it’s about to add another early next year. Meet the new Trailblazer which slots in between the Trax and Equinox. Chevrolet is not releasing any details at this time, but where it slots in suggests the base price will be about $22,600. It will also give Chevy two more crossovers than Ford, even after Ford comes out with the Bronco. One thing’s for sure, the Trailblazer sure looks a lot like the Blazer, and by the way it will be made in Korea.
BUICK CONFIRMS ENCORE GX FOR U.S.
Back in April, Buick unveiled a new, long-wheelbase version of the Encore, called the Encore GX. Now it confirmed the CUV will come to the U.S. market early next year. And it’s no wonder. Nearly 90% of all Buick’s sales in the U.S. come from its utility vehicles. The GX will slot between the current Encore and the Envision/Enclave. It’s said to have 5 more cubic feet of cargo space than the Encore and 3 less than the Envision.
LEXUS REFRESHES THE RX
Lexus took the wraps off the new RX and the three-row RXL. It’s styling has been refreshed with a sharper, more aggressive front-end but overall the look is similar to the current model. It comes standard with an 8-inch display screen but a 12.3-inch touchscreen is also available. It’s also the first Lexus model to offer Android Auto. The performance F Sport models now come with the latest active variable suspension system which is borrowed from the LC. A hybrid version is once again available which combines a 3.5L V6 with two electric motors. Fuel economy for the hybrid is estimated at 30 MPG combined and 29 MPG for the three-row model. The new RX goes into production in the third quarter of this year and pricing will be announced later.
Coming up next, John will be here to share some of his thoughts on the FCA-Renault merger. And he’s worried.
U.S. COULD CARRY BRUNT OF FCA & RENAULT MERGER
The FCA proposal to merge with Renault has me worried for the people in Auburn Hills, Michigan which is where Chrysler is headquartered. The merger will be a completely European deal, and there will be no American voice in the new structure, even though Chrysler generates most of the profits. FCA and Renault are in trouble in Europe. They claim that no one will lose their job with the merger, but they can’t make that promise for the long term. And when they start to look for synergies and efficiencies, they’re going to be mighty tempted to cut jobs at Chrysler. When Sergio Marchionne wrote his “Confessions of a Capital Junkie” one of the key areas he saw for cutting costs was eliminating all the overlap in powertrain. All the automakers make engines of the same or very similar displacement, and they make transmissions with the same number of gears. FCA and Renault will want to consolidate that, and I worry that they’ll start eliminating powertrain engineers at Chrysler. And it won’t stop there. The same goes for finance, HR, purchasing, and every other corporate function you can think of. They’ll also be tempted to get rid of Dodge and the Chrysler brand and feed that money into Alfa Romeo and Maserati, even though Maserati is in deep trouble, and Alfa has come nowhere near its promised potential. Also, Detroit is very lucky that FCA already announced it will build a new plant to make Jeeps in the city. Under the FCA-Renault merger, there will be enormous pressure to move manufacturing jobs to Europe. Look, it’s critically important for FCA to find a dance partner. I’m just worried that the U.S. side of the operation is going to carry the brunt of any cost cutting.
Have you ever heard of Yanfeng? It’s one of the world leaders in automotive interiors and on today’s Autoline After Hours we’ll be talking about future interiors for autonomous cars. If you have any questions of your own, send them to viewermail@autoline.tv, then make sure to tune in at 3PM eastern time when we go live.
But that’s it for today, thanks for watching and we’ll see you again tomorrow.
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Comments (28)
May 30th, 2019 at 12:01 pm
fca renault merger, this side of the pond keep your head down get back to work. other side of the pond needs money,and lots of it. we must fund the schlumperheinies on the other side of the pond.
May 30th, 2019 at 12:13 pm
If all you say is true John, and I have no reason to doubt you, it appears that Renault will finally succeed in ruining Jeep/Ram over here. An analogy might be like leaches (you know, a good bleeding has to be good for you, which was conventional wisdom in the dark ages); well too much parasitic drain eventually kills the host so we’ll have to see the strategy taken by Renault. I hope they still aren’t in the ‘dark ages’.
May 30th, 2019 at 1:08 pm
You’re absolutely right John. Consolidation means there WILL be plant closures and job reductions -even in engineering, there’s no way around it.. unless they plan to massively grow product lines while the industry is in a down cycle, which would be highly unlikely and unwise.
With the Agnellis still holding the largest decision making cards and John Elkann as Chairman, why should we expect any new product development on the US side? Only additional cuts and reductions to feed Italian coffers and pipe dreams.
Auburn Hills has essentially been trimmed to serve just Jeep and Ram, as there’s no new products confirmed for Chrysler or Dodge -which seem to have been sidelined.
And why even keep Chrysler and Dodge alive, if those customers could be served by Nissan (that is if Nissan doesn’t leave the group in protest)? Nissan already outsells the two legacy Mopar brands combined.
I dunno, this merger mess they’re cooking up sure doesn’t smell good to me..
May 30th, 2019 at 1:26 pm
Don’t be so paranoid John. When Renault saved Nissan, it had the same chance to gut Japanese production and transfer jobs to Europe … and it didn’t do it. If FCA and Renault want to survive long term, they have to make SOUND business decisions. The US is still the least expensive place to manufacture for US consumption.
May 30th, 2019 at 2:16 pm
I wonder if Obama’s restrictions on mining on federal lands put the USA behind on rare earths minerals
May 30th, 2019 at 2:59 pm
The styling of the new Trailblazer looks very similar to the Volvo XC 40. The grille seems to be the only point of difference.
Buick designers need to start working on some ways to add some “eyeball” to that Encore GX. Its current look is pretty boring.
May 30th, 2019 at 2:59 pm
I hope President Donald J. Trump weighs in on the Renault – FCA merger, since US taxpayers bailed out Chrysler twice in my life time.
The Trailblazer will be smaller than the Equinox? Bad idea Chevy! Build a Trailblazer based upon the Colorado with a totally enclosed passenger and rear storage compartment and seating for seven.
May 30th, 2019 at 3:13 pm
#7 Not only Chrysler, how about GM.Their cars are made in S Korea,, China & Poland! Screw all of these takers, I now own 2 Lexus cars, one of which is made in Kentucky.
May 30th, 2019 at 3:46 pm
8 All car companies manufacture, and buy parts from all over the world. GM, Ford, and Chrysler would have been long gone, and far beyond the possibility of being “bailed out” if they hadn’t started operating globally decades ago.
May 30th, 2019 at 4:00 pm
7 The Blazer is bigger than the Equinox, so smaller than Equinox would be the “hole” to be filled, if they really need another CUV.
If they want to revive Hummer under the Chevy name plate, or make something to compete with Jeep Wrangler, it should probably be based on the Colorado.
May 30th, 2019 at 4:05 pm
5 Most of these elements are mined in various places around the world, China dominates the processing. From the linked article:
“Although, according to U.S. Geological Survey data, China contains only a third of the world’s rare earth reserves, it accounts for 80% of U.S. imports of the group of 17 minerals used in military equipment and high-tech consumer electronics.
That is largely due to China’s domination in processing. Efforts to build rare earth processing plants in the United States are still in the early stages and lack unified support from Congress and the administration of U.S. President Donald Trump.”
May 30th, 2019 at 4:13 pm
8 Yeah the automotive industry is and has been global for many years. I find it hard to believe that people still think that brands like GM, Ford, Harley or Tesla are pure American. There is no such thing anymore. Component parts are sourced all over the world. Yeah its nice that GM, Ford and Tesla headquarters are still located in the US. But if everything used in their vehicles was American the tariff tiff going on would be of no concern.
May 30th, 2019 at 4:21 pm
These AV concept interiors with passengers lounging around remind me of a “bunch of jellybeans in a jar” for when you get hit unexpectedly! And the FCA joint venture scheme still sounds a lot of warning alarms for the US side (read the golden goose w/golden eggs)having any real chance of remaining in tact. The Europeans are always looking for the money flywheel to keep “them afloat”! UAW wake up!!
May 30th, 2019 at 5:32 pm
8, etc. I don’t know how it would affect Trump’s trade war, but for public perception, assembly is what counts. If GM, Ford, or Chrysler assembled all of their vehicles in the US, many car buyers would consider them “all American,” even if 2/3 of the parts came from China.
May 30th, 2019 at 6:13 pm
Isn’t the percentage of U.S. part posted on the window sticker of new cars? The last time I looked Honda had the most content. Is there any info on what brands generate the most $ kept into the U.S?
May 30th, 2019 at 6:42 pm
15 There was, and maybe still is a window sticker with that information. There used to be a government web site with that information, sortable different ways. Unfortunately, that went away a year or two ago.
Here’s info about American-ness for 2018 model year. Two on the list are now, or soon will be “orphans.”
May 30th, 2019 at 6:45 pm
https://www.cars.com/american-made-index/
May 30th, 2019 at 6:55 pm
Thanks Kit. You always seem to come through.
It may be too late, but I believe the need for unions ( UAW) is stronger than ever. It’s a damn shame the upper brass have ruined what a union should represent. If only they could only clean house and become a real voice of the workforce, maybe the could gain some credibility and clout to make change.
May 30th, 2019 at 7:19 pm
11 That’s funny kit how when it comes to the lack of rare mineral processing plants in the US you can even elude to it having anything to do with the Trump administration. The guy who is being blasted for cutting regulations and making mining grow in the US. You did get it right as far as not getting unified support from congress tho.
May 30th, 2019 at 7:32 pm
9 & 12 Every car manufacturer is global and I respect building cars in foreign countries FOR foreign countries. What I object to is they took our money on the pretense of saving American jobs by building cars here not overseas and bringing them here.
May 30th, 2019 at 7:45 pm
19 Huh? I just copied and pasted the part of Sean’s link relevant to our sources of “rare earth” minerals.
May 30th, 2019 at 8:16 pm
20 Car companies tend to build specific models where they will sell the most of that model. BMW builds X5, and M-B builds GLE in the US, where a majority of them are sold, but ship them all over the world. Ford builds Fiesta in Mexico, where they sell the most, at least in the Americas, and ship them to various counties in the Americas, including the US, until Ford decided to abandon the car market in the US. Many of the Honda and Toyota products assembled in the US are versions specific to the US market, but there are some that are exported. For good reason, car companies do not build car models in the US, when only 10% of that model will be sold in the US.
May 31st, 2019 at 4:21 am
I agree w John, FCA should not touch those losers at Renault with a 10 foot pole. Every time some fool in the US merged with these crooks in Europe (GM with Fiat, lost $ 4 bill!, or Chrysler w Daimler), they got the short end of the stick. Not only that, every time some fool (usually Ford) in the US bought one of these losers big or small there, they wasted tens of billions, and then wasted more billions to fix them (see Jag) and still they remained a problem case
May 31st, 2019 at 4:23 am
As for the pudgy Buick Encore, one of the ugliest crossovers out there, (same for its twin the Chevy Trax), the “L” version was a long awaited fix. But What will they call the Long trax? Isn’t it the Equinox already? (not that I care, I would be caught dead than driving any of these vehicles)
May 31st, 2019 at 8:32 am
24 From today’s segment just before the one about the stretch Encore, it sounds like the long Trax will be called TrailBlazer.
May 31st, 2019 at 9:52 am
I believe the real issue with rare earth minerals is the very dirty refinement process.
Lots of toxic and radioactive waste. Even rare earth minerals that are mined in California are sent to China for refinement.
May 31st, 2019 at 11:15 am
26 Ahh so we as Americans don’t want to be bothered with the messy or toxic types of processes so we let countries like China flourish and get a monopoly on the finished product rather than putting in the proper safeguards to operate a plant like that here in the US.
We will consume and buy batteries that generate toxic by-products as long as that mess is in another country. So we care about the environment or people as long as they live here?
Oh wait its because in China no worker that contracts cancer is ever going to sue their employer. I got it.
June 1st, 2019 at 8:28 am
I’ve always like the look of the Model S and more range is a good thing, but it is priced like an S Class, so interior appointments should, IMHO, be getting richer and not simpler! I understand that this flys in the face of the EV motif, because those appointments add weight and there by reduce range. There has got to be some type of balance (figuring out how to make those luxury appointments lighter, maybe?) that give an individual the luxury look and feel they want and the power and long range that the customer also demands.