Listen to “AD #2912 – GM Will Make Nikola's Pickup; Mercedes to Earn Billions from Data; Kia Closes U.S. Sales Gap with Hyundai” on Spreaker.
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Runtime: 8:37
0:07 GM Will Make Nikola’s Badger Pickup
1:07 Stock Market Likes GM & Nikola Deal
1:42 Mercedes Expects to Earn Billions from Data
3:05 Kia Closes U.S. Sales Gap with Hyundai
3:55 Parents Spend 4-Days/Year Getting Kids in Cars
4:59 Hyundai Developing Battery Ecosystem
5:54 Tesla & Volkswagen Collaborating?
6:47 Volvo Moving Sales Process Online
7:32 Wuling’s MINI EV Now Best-Seller in China
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GM WILL MAKE NIKOLA’S BADGER PICKUP
When Trevor Milton paid a visit to Autoline After Hours he said that Nikola would announce in a couple of months that a major automaker would build his pickup truck called the Badger. And in a bombshell of an announcement this morning, General Motors announced that it will build it. As part of the deal Nikola will give GM 11% of its shares worth $2 billion. The Badger will use GM’s Ultium battery pack and its fuel cell system that GM calls Hydrotec. In fact, GM is going to engineer, homologate and validate the Badger as well as make it. And GM will provide fuel cells for Nikolas semi trucks, the Tre, the Nikola One, and Nikola Two. It will also help Nikola engineer its electric off road side-by-side called the NZT. Nikola says the deal will save it $5 billion over the next 10 years, while GM says it will earn $4 billion selling engineering services, parts and EV credits.
STOCK MARKET LIKES GM & NIKOLA DEAL
One thing’s for sure, the stock market loved the news. Nikola stock shot up 31% in pre-market trading, while GM was up 6%. Meanwhile, Tesla stock took a hit when it was not included on the S&P 500 index. Investors had bid up the stock in anticipation that it would be included, because if it had, a lot of investment funds would have to buy Tesla. Many funds invest in the S&P 500 index, and that means they have to buy the stocks in that index.
MERCEDES EXPECTS TO MAKE BILLIONS FROM DATA MONETIZATION
They say that data is the new oil, and Mercedes is down with that. The electronic architecture in the new S-class finally brings Benz into the digital age of connectivity and over-the-air-updates. Ola Kallenius, the CEO of parent company Daimler, says this opens up a “new revenue and profit pool.” Mercedes already has an app store and is eager to sell customers more content. Mr. Kallenius clearly expects them to buy a lot more. He says Mercedes now earns over 100 million euros a year in data monetization and expects that to turn into billions of euros a year. For automakers, data monetization could be a pot of gold at the end of the rainbow. Profit margins on data are significantly higher than profit margins on cars.
KIA CLOSING U.S. SALES GAP ON HYUNDAI
Hyundai and Kia are part of the same company, but there is a healthy rivalry between both brands. Hyundai has always been the bigger of the two, but in the U.S. market, the gap is closing fast. Back in 2015 Hyundai sold nearly 136,000 more vehicles than Kia. But last year the gap fell to only 95,000. And based on how things are going this year, it looks like Kia will only be 32,000 vehicles behind Hyundai. While the Hyundai Group must be pleased to see how well Kia is doing, we think the sales and marketing people at the Hyundai brand must be feeling the pressure. It kind of reminds us of the old rivalry between Buick and Oldsmobile. Both were proud to be part of General Motors, but were sworn enemies when it came to selling cars.
Hyundai vs. Kia U.S. Sales | |
---|---|
2015 | 136,000 |
2016 | 127,000 |
2017 | 96,000 |
2018 | 88,000 |
2019 | 95,000 |
2020 | 32,000? |
PARENTS SPEND 4-DAYS/YEAR GETTING KIDS IN CARS
Trying to get kids in a car to go somewhere can be a real pain in the butt. There’s constant reminders to put on shoes, loading up bags filled with things for every conceivable scenario you might encounter and of course the inevitable “I have to go to the bathroom,” which comes only after they’re fully strapped in and you just got comfortable in your seat. And according to a new study from Spanish automaker SEAT parents from Spain, Germany and England have to lengthen their routines by an average of 20 minutes to accommodate for getting kids into the car. In some cases that’s still not enough. 55% of parents in Spain admitted to being late for work at least once a week. On average parents spend 96 hours a year getting their kids into the car. That’s four days! But like most parents, I’ll gladly take the extra time to make sure I have their favorite stuffed animal to avoid a meltdown or that my kids are properly strapped into their seats.
HYUNDAI WORKING ON BATTERY ECOSYSTEM
Electric vehicles cost more than their similar sized ICE counterparts because the batteries are expensive. That’s why Hyundai partnered with SK Innovation to create a sustainable ecosystem that covers the entire lifecycle of EV batteries. The two companies will collaborate on EV battery sales solutions and battery reuse and recycling. Batteries that are no longer useable in vehicles will be repurposed for energy storage systems. And recycling batteries will involve extracting valuable metals like lithium, nickel and cobalt. And if the companies are successful in creating the ecosystem, it should help bring the cost of batteries down.
TESLA & VOLKSWAGEN COLLABORATING?
Is there something going on between Tesla and Volkswagen? That’s the buzz after Elon Musk met with VW CEO Herbert Diess during a trip to Germany. The two drove around in an ID.3 and had a chat. Diess revealed that Musk was critical of the car’s available torque at higher speed, to which Diess replied, “Yes, we are on the runway (of an airport) – but no need for take off – its not a sports car.” With that kind of rapport, it does sound like the reports are true that the two talk on the phone regularly. However, the Volkswagen CEO came out yesterday and said, “there is no deal/cooperation in the making.” But what do you think? Supposedly their meeting lasted a couple of hours, and we don’t think they spent so much time together talking about the weather. So, are they just pals, or is there more to this?
VOLVO MOVING BUYING PROCESS ONLINE
Consumers are becoming more comfortable buying things online and they increasingly want to have the same experience when purchasing a new car. That’s why Volvo is looking to transition to sell more vehicles online. By 2025 it wants half of its global sales to be digital. To help make that happen, it is purchasing two dealer groups in Sweden, to merge with its own dealerships. This will enable the company to pilot a new online/offline buying experience in its home market. But it also points out it will do this with the help of its dealer partners. But Volvo will have to come up with a different strategy for the U.S. because it’s illegal for automakers to own their own dealer network.
WULING’S TINY EV NOW BEST SELLER IN CHINA
Wuling, a joint venture partner of GM’s in China, is already seeing success with its micro-EV, the Hong Guang MINI EV. While it only launched in July, the MINI EV is already the best-selling EV in China with 15,000 units sold last month. Highlights include a top speed of 100 km/h or 62 MPH, a range of up to 170 km or 105 miles and a price between $4,200 and $5,700. The next best selling EV is the Tesla Model 3 at close to 12,000 units sold, but the price likely helps explain the difference.
But that brings us to the end of today’s show, thank you for watching.
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John McElroy is an influential thought leader in the automotive industry. He is a journalist, lecturer, commentator and entrepreneur. He created “Autoline Daily,” the first industry webcast of industry news and analysis.