On today’s show…Ford and Daimler end their fuel cell partnership…could car sales drop by millions of units in the American market?…and Volkswagen is slapped with another fine over its diesel emission cheating scandal. All that and more coming right up on Autoline Daily.
This is Autoline Daily the show for enthusiasts of the automotive industry.
UAW ELECTS A NEW PRESIDENT
The UAW elected a new president yesterday, Gary Jones. And for the first time the union will be led by a certified public accountant. That may be the perfect background for the union, which is being investigated by federal prosecutors because of union leaders who funneled money that was earmarked for training into their own pockets instead. Hopefully, having a CPA as president will impose tighter financial controls on union leaders to lead them not into temptation.
GM’S CFO RETIRES
And in other management changes, General Motors Chief Financial Officer, Chuck Stevens, announced he’s retiring after 40 years with the company. He will be replaced by Dhivya Suryadevara, who is currently GM’s Vice President of Corporate Finance. She’s played a role in selling off Opel, acquiring Cruise and the recent Softbank investment into GM Cruise.
COULD CAR SALES DROP BY MILLIONS?
So far this year in the U.S. car market the SAAR is running at 17.1 million vehicles. But as part of its contingency planning, FCA is getting ready for a SAAR of only 14.4 million new vehicles in 2020. And it’s not the only one with a bearish outlook. Merrill Lynch is forecasting the SAAR will drop to only 13 million in 2021. In other words, we could see sales of new vehicles drop by three to four million units in just the next two to three years. And if that happens then we’re going to see which automakers and suppliers really know how to run their business.
Still to come…VW just can’t seem to shake its diesel cheating scandal.
GERMANY FINES VOLKSWAGEN
Volkswagen is still being punished over its diesel emission cheating. Germany just fined the company one billion euros for the scandal, which is one of the largest fines ever handed out by Germany authorities. But that’s just a drop in the bucket to the $25 billion in fines, penalties and restitutions the company has paid so far in the U.S.
FORD & DAIMLER END FUEL CELL PARTNERSHIP
Toyota, Hyundai and Honda sell a small number of cars powered by fuel cells. In fact, Honda and General Motors are developing fuel cells together. And Volkswagen is working with the Canadian company Ballard to develop fuel cells. But Ford and Daimler are abandoning their joint venture to develop fuel cells. They’re going to take that work in-house instead. Here’s our Autoline Insight. This sounds like a cost cutting move. Probably neither Ford nor Daimler see any near-term payoff making fuel cells. And so they’ll likely take that money and put it into battery electric cars.
FORD IMPROVES FUEL ECONOMY FOR FLEETS
And in other Ford news, the company is beefing up its hybrid and diesel line-ups for fleets. The taxi version of the Transit Connect is now offered with a 1.5-liter diesel that is expected to return a highway rating of 30 mpg. And the new Fusion Hybrid Taxi is projected to get a combined 38 mpg. In addition to the new taxi offerings, Ford also announced that the Police Interceptor Utility will now be available with a standard hybrid powertrain. The company estimates its EPA numbers will hit a combined average of at least 24 mpg, a 40 percent improvement over the current 3.7 liter V6 engine. Ford expects that the fuel savings could help law enforcement save $3,200 per vehicle in fuel each year.
Coming up next, GM explains how it’s Super Cruise system responds in a medical emergency.
HOW SUPER CRUISE RESPONDS IN EMERGENCIES
GM’s semi-autonomous Super Cruise system is a great feature but what happens if the driver suffers a major medical emergency, like a heart attack while it’s being used? Will the system just keep on going? On last week’s Autoline After Hours we were joined by Jason Ditman, the Chief Engineer of Super Cruise, and he explained how the system responds in those situations.
(The AAH preview is only available in the video version of today’s show.)
And don’t forget to join us for Autoline After Hours this afternoon. We’re going to have Lightning Systems in the studio talking about how they convert Ford Transits into electric vans. So join me and Gary Vasilash for some of the best insights as to what’s going on in the automotive industry.
But that wraps up today’s report, thanks for watching and we’ll see you right back here again tomorrow.
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Comments (16)
June 14th, 2018 at 12:10 pm
Car sales dropping by millions? So why? Is this indicating auto manufacturers moving towards people renting cars when needed versus owning/leasing? Is it because the idea of buying “new” cars losing its appeal and they see people keeping their cars for a much longer time? Could the price of new cars getting too high for many people to afford? Is the fact that cars lasting much longer when maintained convincing people to keep them for many years beyond what is the average now? What is behind this prediction.
June 14th, 2018 at 12:18 pm
It seems to me that fractional ownership should work for vehicles as it does for aircraft.
June 14th, 2018 at 12:33 pm
GM’s Supercruise is perhaps the biggest waste of $5,000, yet it’s the most honest of the self driving systems. It only works in select areas and then on limited access highways. You still have to be paying attention or the system shuts off. I think GM knowingly rushed this to market for bragging rights, but the admitted limits make it pretty impractical for most of us.
June 14th, 2018 at 12:43 pm
I hope that having an accountant lead the UAW works out better than it did for GM (Roger Smith).
June 14th, 2018 at 12:58 pm
I believe it be more cost effective for the Automotive Industry to combine their efforts instead of first towards Autonomous Driving and divert it’s attention to the adaption of what I call “Automatic Vehicle Braking”(AVB).
All this new technology in vehicles today contributes to distracted driving so the easiest way to combat this ill of modern technology is to remove it from the vehicles totally, which is now socially unacceptable.
Therefore the solution is AVB. Incorporate all available counter measure technologies which can be had at a far lower cost than Autonomous Driving Technology being introduced into every new vehicle. Automatic Vehicle Braking in both forward and rearward directions should eliminate many of the usual accidents and crashes on the roads currently and save many lives. Autonomous Driving Technology will itself reduce vehicle ownership due to it’s high additional cost. If mandated by government it will make vehicle ownership virtually impossible for many socio-economic groups in the country.
June 14th, 2018 at 1:34 pm
#5 I agree Lex however, I believe we are 10 or 20 years from any government mandate when it comes to AV. I mean the technology is developing quickly and has made significant improvements in just the last couple years, but its still only realistic to operate in preferential conditions. Getting a system to work in sunny California is one thing but a system that can operate in a Mid-west ice storm where your windshield turns to bathroom glass with ice build up, is a whole different situation. So again the government shouldnt mandate anything that only works part of the time and only under certain conditions or locations. We are certainly many years away from being able to overcome all types of conditions that northern winter drivers deal with.
June 14th, 2018 at 1:40 pm
Improved roads and embedded sensors is the future of real world self driving cars. Here is an article talking about this direction.. https://atelier.bnpparibas/en/smart-city/article/autonomous-vehicles-require-smart-roads
June 14th, 2018 at 1:49 pm
Could the drop in sales be caused by the massive borrowing that the government will have to do because of the tax breaks? This is wall street banks are predicting!
June 14th, 2018 at 1:50 pm
I often wonder if we wont see a significant increase in three wheel vehicle manufacturers. As long as their requirements are not the same as their 4 wheel counterparts it could. As all these advancements in EV, AV, and driver assist functions continue to increase car prices there may come a day where the middle class American can no longer afford a traditional vehicle. Three wheeled vehicles that offer just the basics without meeting all the safety and crash requirements would certainly be able to be sold much cheaper. Yea might only be slightly safer and drier than a motorcycle but I think many people would like to buy a new car for under 10K. Then SAAR may stay around the 17M.
June 14th, 2018 at 2:00 pm
Car sales WILL drop drastically in the future, but only for a couple of years. The reason will be that buyers will decide that it is too late to buy a conventional car, but too early to buy an electric AV. Prudent buyers will just decide to wait a few years for the situation to clear up.
PS With electric AV’s expected to offer cheap rides, why would anyone buy an non-electric AV or an electric non-AV?
June 14th, 2018 at 2:18 pm
1) Rising interest rates? Rising car prices, because of steel tariiffs and the rest of the Trump trade war? Also, there probably are fewer people who just want a new car, when they don’t need one.
June 14th, 2018 at 2:57 pm
Taxi HWY mpg?! Who cares about that? What’s the city number?
June 14th, 2018 at 2:59 pm
#11 Cars/trucks are many different things to many people. For some it was an extension of their personality and for some a status symbol. As vehicles move more toward being an appliance of transportation the love affair for the American car is diminishing. Along with that will be a lesser inclination to replace it. It becomes more and more like a washer and dryer. As long as it works and keeps running for 20 years why replace it? IMO the general public does not care or get excited about a new model like they used to. I could see this having an impact on sales too.
June 14th, 2018 at 5:47 pm
It is a shame to see the auto industry turning into transportation appliance business. I am glad I have lived my early years during the time when cars were fun to drive and easy to improve and repair. I guess the consumer computer/smart phone and gaming industry is the new fun thing for young people to get excited with and enjoy.
June 15th, 2018 at 8:13 am
I think that the story on car sales dipping to 13 million is a bit premature. Sure they may, but just as likely, they may stay steady or increase. Some of the latest predictions of monthly and quarterly estimates have been way off. Do I think that FCA should or shouldn’t prepare for 13/14 million SAR, well yeah; it is probably more prudent to be ready to de-escalate at a controlled pace than to have to ramp-up quickly. Doing some roll-back now, on their terms, seems the prudent thing to do.
June 15th, 2018 at 9:11 am
Ford is preparing for lower sales, by dropping all of their more efficient cars.