Listen to “AD #2997 – Chip Shortage Crippling Production; Ford Mustang Going Fully Electric; BMW's M Sets Sales Record” on Spreaker.
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Runtime: 9:29
0:07 Chip Shortage Crippling Car Manufacturing
0:42 Chip Shortage Comes at Worst Time for Industry
1:08 Pandemic Helps Cause Chip Shortage
1:42 GM Shows No Signs of Chip Shortage
3:14 Scania Ramping Up Electrification Efforts
4:31 Ford Mustang Going Fully Electric
5:12 Wild Custom Motorcycle
6:08 Tesla Suing Chinese Media Outlet
6:51 BMW’s M Division Sets Sales Record
7:25 BMW Updates Digital Key w/ Ultra-Wideband Tech
7:47 Small Barn Find Needs Identifying
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CHIP SHORTAGE CRIPPLING CAR MANUFACTURING
That chip shortage sure is crippling car manufacturing all around the world. Autoforecast Solutions reports that Mercedes cut production in Germany. FAW and SAIC were hit hard in China. Honda slowed production in the United States, England, and Japan. Suzuki, Subaru and Nissan also slowed production in Japan. Audi and Seat cut production in Spain. Mahindra cut production in India. Ford slowed production in the US, and so did FCA—whoops, we mean Stellantis!.
CHIP SHORTAGE COMES AT WORST TIME FOR INDUSTRY
This semiconductor shortage could not come at a worse time for the industry. Automakers lost a lot of production last year when they closed down for up to 8 weeks because of the pandemic. And they’ve been running on low inventory ever since. Wards Intelligence reports that North American production fell 20% last year, and says it could take several years before the industry can get back to previous levels.
PANDEMIC PLAYS ROLE IN CHIP SHORTAGE
So what the heck is causing the chip shortage? Bloomberg reports that when automakers closed down their plants last year due to the pandemic, they cancelled a lot of orders for chips. So the chip makers switched their production to consumer electronics, which were enjoying a sales boom because people in quarantine were looking for home entertainment. Then, car sales came roaring back far faster than anyone expected. But it was too late. That chip production was already spoken for, and we don’t know how long it will take to refill the pipeline.
GM SHOWS NO SIGNS OF CHIP SHORTAGE YET
But here is one very interesting side note. None of our sources show any slowdown at General Motors. In fact, Autoforecast Solutions says that GM is running 5 of its U.S. truck and SUV plants on overtime. Maybe GM will still get caught up in this shortage. But right now it looks like GM has one of the best purchasing and logistics teams in the industry.
SCANIA RAMPS UP ELECTRIFICATION EFFORTS
As we know, it’s not just passenger vehicles going electric, so are commercial vehicles. And since Scania thinks it was a little late to the EV bus segment, it’s accelerating the electrification of its truck lineup. It already has a plug-in hybrid and full electric truck, but Scania says in just a few years it will offer electric long-haul trucks that can carry 40 tonnes for 4.5 hours and charge back up in 45 minutes. By 2025, Scania expects 10% of its truck sales to be electrified and for that to jump to 50% by 2030. Scania also has investments in hydrogen technologies, but only sees a limited number of applications for them. It says a great deal of energy is lost through the manufacturing and converting of hydrogen fuel to electricity. In fact, three times as much renewable electricity is needed to power a fuel cell truck compared to a battery electric one. Repair and maintenance costs will also be higher compared to a BEV truck. However, Scania sees value in charging stations that use stationary fuel cells, especially for areas with lots of renewable energy.
FORD MUSTANG GOING FULLY ELECTRIC
Last week we reported that Mustang fans are going to have to wait a while for the next-gen version of the sports car because it won’t go into production until December of 2028. And there could be a good reason for the long wait. Autoforecast Solutions reports the standard Mustang is going fully electric as well. And it sounds like that will be the only powertrain setup. It’s also important to note the next-gen Mustang will be made at Ford’s Flat Rock, Michigan plant. To our knowledge, there hasn’t been a single other EV announced for that facility. So, it’s also going to take extra time to tool it up for electrics.
WILD CUSTOM MOTORCYCLE
BMW Motorrad showcased a number of custom bikes to highlight its all-new but old-school-looking R 18 engine and this one is just too wild to pass up. I don’t even know where to start to even try and properly describe it, but it looks like someone’s made up creation for a steampunk movie. It’s both beautiful and hideous and we can’t seem to keep our eyes off of it. The bike is the brainchild of Kingston Customs, which is known for some of its crazy designs. And surprisingly the customizer says it left the engine and frame 100% original.
TESLA SUES CHINESE MEDIA OUTLET
Tesla is suing Chinese media company, PingWest, over an article it published last month, accusing the EV company of having poor working conditions and quality issues at its factory in Shanghai. The claims range from the fairly innocuous complaints about the food served in the cafeteria, to very serious allegations that the company knowingly used defective parts to speed up production. PingWest says it received an indictment letter from Tesla over the weekend and will cooperate with the lawsuit. It has to submit any counter evidence by February 8th. Who knows if the allegations are true or what will happen? But this will be an interesting story to follow.
BMW’S M DIVISION SETS SALES RECORD
This next item proves that performance sells. BMW saw its sales drop over 8% last year but its M performance division fared much better. Despite the pandemic, BMW sold 144,218 M vehicles globally, which is a record. The performance division set sales records in the U.S. and China, which helped fuel its growth. BMW is launching three more M models this year, so it wouldn’t surprise us if it sets another record in 2021.
BMW UPDATES DIGITAL KEY WITH ULTRA-WIDEBAND TECH
And in other BMW news, the company introduced an updated digital key for iPhones that now uses Ultra-Wideband technology. It allows drivers to unlock or start the car without having to take their phone out of their pocket or purse. The new digital key debuts on the upcoming iX electric crossover.
SMALL BARN FIND NEEDS IDENTIFYING
We’ve got our first Barn Find of 2021, which comes from viewer Will Prudden. Will notes “A friend is contemplating purchasing some property with a barn and inside the barn was what appears to be a very small old car with wooden wheels. I was wondering if anyone might be able to identify it?” We’d say, it certainly is small. Too small, in fact, to be a production vehicle. It looks to us like the frame was cut and the rear end bolted further forward. We would guess this was used as a little runabout for all kinds of things around someone’s farm. But what do you think? Can anyone out there tell what kind of engine this is? Let us know in the comments section.
Have you ever heard of a supplier company called Gentex? No doubt a lot of you have. It started out as a little company on the west side of Michigan that made rearview mirrors. Then it cornered the global market on mirrors, and today it’s turning into a tech company that makes a lot more than mirrors. And on Autoline After Hours this Thursday we’re going to have Neil Boehm, the chief technology officer of Gentex, as our guest. So join John and Gary as they peel back the layers of how this industry works.
But that brings us to the end of today’s show. Thanks for watching and we hope to see you back here again tomorrow.
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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.