AD #3565 – GM Going Back to EU with EVs; Wuling Mini EV Now Only $2,850; McLaren Embraces IC Engines
May 11th, 2023 at 11:56am
Listen to “AD #3565 – GM Going Back to EU with EVs; Wuling Mini EV Now Only $2,850; McLaren Embraces IC Engines” on Spreaker.
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Runtime: 9:55
0:00 Greenpeace Warns of Idle ICE Plants
0:59 GM Forms New Commercial Vehicle Business Unit
1:44 GM Going Back to EU with EVs
2:21 Honda Expenses Rising Faster Than Sales
2:54 Nissan Earnings Looking Better
4:10 Lexus Teases New GX
4:38 McLaren Embraces IC Engines
5:20 Maserati Dumping V8s
5:50 Alpine Tweaks the R5
6:27 VW ID.7 GTX Gets In-House Motors
7:22 GM Cruise Heads for Houston, Dallas
7:49 Wuling Mini EV Now Only $2,850
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GREANPEACE WARNS OF IDLE ICE PLANTS
The ten largest automakers in China could see one third of their ICE assembly plants sitting idle by the end of the decade. That’s according to Greenpeace, which assumes New Energy Vehicles, or NEVs, will have 40% market share in 2030. But NEVs already have a 30% share, so that idle capacity could hit a lot sooner. Greenpeace is urging those automakers to convert ICE plants to EVs as fast as possible. But China already has a massive problem with overcapacity. Automakers have the capability to make over 40 million vehicles a year, however sales are currently running around 25 million. And this is a key reason why Chinese automakers are really ramping up exports.
GM FORMS NEW COMMERCIAL VEHICLE BUSINESS UNIT
General Motors is taking a page out of Ford’s book and is consolidating all its commercial vehicle operations into one business unit–just like Ford did with Ford Pro. Called GM Envolve, the goal is to make it easier for customers to purchase vehicles and sign up for services. Fleet buyers will only have to deal with a single sales representative, who will help them pick out a tailored set of services for both ICE and electric commercial vehicles. GM’s fleet business is going strong, with sales increasing for five straight quarters and it just posted its best sales for the first quarter since 2006.
GM GOING BACK TO EU WITH EVs
Speaking of GM, it’s getting back into the European market with electrics. At the moment, GM only sells high end ICE models in Europe, like Cadillacs and the Chevy Corvette. It pulled out of the mass market in 2017. But that will soon change. Automotive News reports that GM will first return this fall to Nordic countries, which makes sense because of Norway’s strong EV market. GM hasn’t confirmed which vehicles it will sell but it will include EVs across all of its brands.
HONDA EXPENSES RISING FASTER THAN SALES
Honda posted its financial earnings for its fiscal year, and the results are really mixed. It brought in $126 billion in revenue, which was up a solid 16%. But its expenses shot up 23%, which led to a 3.6% drop in operating profit of $6.2 billion. Fortunately for Honda, its net profit of $5.6 billion was virtually unchanged from last year, thanks to a big drop of income taxes.
NISSAN EARNINGS LOOKING BETTER
Nissan also posted its results for the end of its fiscal year. Even though its sales of 3.3 million vehicles was down 15%, revenue shot up nearly 26% to $79 billion. Its operating profit of $2.8 billion was up 52% but its net profit of $1.6 billion was only up 3%. Nissan expects to sell a lot more vehicles this year and is especially counting on the North American market to lead the way.
HOW LONG CAN LEGACIES LOSE MONEY ON EVs?
How long can legacy automakers afford to lose money on EVs? That’s one of the topics for Autoline After Hours this afternoon. John and Gary have Joe White from Reuters and David Welch from Bloomberg coming on the show and they are going to bring a treasure trove of info and insight. And you can join the action when the show goes live at 3 pm eastern time.
LEXUS TEASES NEW GX
The Lexus GX is getting some much needed upgrades. It’s been a while since it’s had truly significant changes, but Lexus is teasing the all-new model that it says is coming soon. The SUV is likely to retain its body-on-frame architecture and the design looks to be playing up its off-roadability with large bulges at the edges of the hood and fenders. And Toyota threw a little mud on the back end for good measure.
MCLAREN EMBRACES IC ENGINES
And next comes a tale of two sports car makers. One is embracing internal combustion, while the other is saying arrivederci. McLaren announced that it’s expanding its partnership with engine manufacturer Ricardo, a company that has built close to 34,000 McLaren powertrains since 2011 at its home in England. Ricardo is now going to make McLaren’s next-gen V8 that will power future hybrid supercars. And along with the V6s and V8s that Ricardo already supplies, McLaren says the agreement ensures it will have engines for both hybrid and non-hybrid applications.
MASERATI DUMPS V8s
And now we switch to Maserati who is getting rid of V8s from its lineup. It will stop making the Trofeo versions of the Levante, Ghibli, and Quattroporte at the end of this year. Those models featured a 572 horsepower twin-turbo V8. And the engine kill-off is only going to continue at Maserati. All models will have an electric version by 2025 and it will be fully electric by 2030.
ALPINE TWEAKS THE R5
Speaking of sporty electrics, Alpine will keep hot hatches alive in the EV era. It revealed it will get its own version of the new Renault 5, what it calls the A290 beta. Unfortunately, it doesn’t give any specs, but it has plenty of pictures that show rally car styling and a 3-seat layout like a McLaren F1; one central seat for the driver up front that is flanked by two seats for the passengers behind. Alpine says it will launch the production version of the A290 next year.
VW ID.7 GTX GETS IN-HOUSE MOTOR
And is Volkswagen going to finally have a truly sporty electric car? It touted its GTX models as such, but with a max of 220 kW or 295 horsepower, they’re really just all-wheel drive variants with black cladding. But the new ID.7 GTX has the potential to be something more. VW says it’s equipped with its latest drive generation. And the new, in-house developed electric motor in the rear-drive ID.7 has 210 kW or 281 horsepower. So, it’s nearly getting the same power out of one motor that the previous GTXs were getting out of two. Now, imagine if the ID.7 GTX gets two of those new motors? Not saying that it will, but like we said, it’s got potential.
GM CRUISE HEADS FOR HOUSTON, DALLAS
Plenty of people are skeptical that we’ll ever see autonomous vehicles becoming a reality, but Waymo recently expanded its self-driving ride hailing service and now GM Cruise is launching in more cities in Texas. It will start testing vehicles in Houston next week with a safety driver on board then will expand to Dallas. Cruise currently operates in Austin as well as San Francisco and Phoenix.
WULING MINI EV NOW ONLY $2,850
One of the most affordable models in China is about to become even cheaper. Wuling is going to offer a battery subscription for its Hongguang Mini EV and cut its price by nearly $2,000. That’s a huge price cut because a base model currently costs about $4,700 but if you opt for the battery subscription its price drops to $2,850. Customers will pay a monthly fee of $30 for 60 months for the battery, which means they can save nearly $300 after five years with the subscription. The Hongguang Mini EV is one of the best-selling EVs in China but sales have started to taper off with more competition coming into the market, so Wuling had to do something to try and boost sales.
But that brings us to the end of today’s show. Thanks for tuning in.
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Comments (22)
May 11th, 2023 at 12:28 pm
With all this excess capacity in China, I expect they will be approaching North America with a resolution to the high tariffs, offering to lower China’s in exchange for better access to the U.S., Canada and Mexico.
I hope our political leaders don’t fall for that. There are precious few big 3 vehicles that are wanted in China, but the low prices and wide selection from China will decimate the domestic auto industry; undoing all the efforts being done to reshore manufacturing.
May 11th, 2023 at 1:03 pm
I’ll admit I’m one of those AV sceptics and I’m not denying it works. My skepticism is that it has limitations. Dallas is a good location as they still get snow on occasion, and this will provide some insight on how well AV adapts to changing weather conditions. It’s really hard for a camera to follow road lines when the road is all white covered in snow. I dont believe AV can overcome this yet and it means anyone that counts on that technology to get anywhere, had better have a plan B when there is any minimal snowfall.
May 11th, 2023 at 1:10 pm
GM Envolve: good idea, terrible name. In addition to meaning nothing, its even hard to pronounce.
Its amazing over the years how Nissan has shrunk. They used to be a solid #2 to Toyota. Now they are far behind Honda in revenue. I knew they were smaller than Honda, but I did not realize the gap had gotten this large.
I think the VW EVs are okay. But, that’s a problem. Their styling is really vanilla. Not much to get excited about. Lots of other more interesting and expressive designs available.
May 11th, 2023 at 1:14 pm
1 – I agree. With the our domestic industry abandoning small cars and midsize sedans, and with the lowest MSRPs now in the mid-$30,000s, the Chinese companies have a big opportunity here. They could flood our market with good quality, inexpensive vehicles that would be attractive to strapped American family budgets. The quality perception would be overcome pretty quickly. Likely much faster than it was for Japanese and Korean vehicles.
May 11th, 2023 at 1:23 pm
Some real math wizards there at Greenpeace. China has the capacity to manufacture 40 Million vehicles and currently has a market of 25 million. Thats 62.5% So currently more than 1/3rd of the plants are already idle or below capacity. So not a real fortune telling breakthrough there Greenpeace. Oh and that has nothing to do with NEVs, that’s the current state.
Id say convert your ICE plants as demand requires not because Greenpeace does some obvious math predicting a condition that already exists.
May 11th, 2023 at 2:19 pm
#1 Agree 100% All one has to do look back . In the 1970s Japan dumped cheap cars on the US market and seriously put a hurting on the Big 3 and eventually helped kill off AMC . In the 80 and 90s it was the Koreans following the same play book and putting another dent in the Big 3 . Allowing China to dump low priced trash (let’s get serious it will be garbage they send here)Cheap disposable cars that will clutter the landscape the minute they break as it will be cheaper to replace than repair IF you could get the parts. Ask Chinese scooter owners if you’re not sure.
May 11th, 2023 at 2:22 pm
#3.) I agree that VW’s ID styling I vanilla and could do with something a little more exciting. I think that is why Ford went with a variation of the Mustang with the Mach-E. Yet, Toyota have none the sleeper design for years and done while with that, too! I just wonder what they what styling says “VW”, that would move the needle with potential buyers?
I hope the new GX does a better job of incorporating the ‘spindle’ grill then the last GX. IMHO, Lexus grill looks better on most of their sedans and smallest CUVs, then it does on the RX and the body on frame vehicles.
May 11th, 2023 at 2:32 pm
BYD is HUGE in China and yet they sell nothing here. Nobody is worried about any Chinese vehicles in the USA for now. Many are startup companies and most people would consider them far less than standard. BYD would certainly have started if it was feasible. Probably crash tests, tariffs and other factors holding them back. But it seems they certainly would have the ability.
May 11th, 2023 at 2:43 pm
8 BYD sells buses in the U.S.
May 11th, 2023 at 2:44 pm
So If Renault ever decides to send the new 5 to the US will they call it the Le Electric Car ?
May 11th, 2023 at 2:51 pm
6 There’s little reason to think that if China sells cars here, they would be trash. The Chinese Buick Envision has equal quality to GM car from the US, Canada, and Mexico. All of the smart phones and TVs from China have decent quality.
May 11th, 2023 at 3:20 pm
11 for sure,decent quality
May 11th, 2023 at 3:32 pm
The only reason the Chinese aren’t here in volume is the tariff.
May 11th, 2023 at 3:38 pm
Didn’t Peter D warn everyone when they were so anxious to get in bed with Chinese firms that they will regret it later?
May 11th, 2023 at 3:39 pm
11 A GM factory in China and a Chinese start-up is much different in my book. Having seen some of the crap that China pawns off in the US market, I dont have much trust in their quality. Yeah maybe they do make great phones or TVs when they are held to the quality standards of a parent company. But left to their own devices, and having experienced the knock-off designs or products with cheaply made internals. Toxic chemicals, lead based paints or just weak metals they make a lot of inferior products that are all about making it cheaper. You get what you pay for and I would be surprised if China hits the NA shore with a good quality product.
Even Korea had its struggles and makes a decent car now but they were no so great at first so maybe China took notes. We will see but I wont be buying anything from them.
May 11th, 2023 at 4:02 pm
15 BYD are selling cars in Europe, where people buy cars more for quality and performance, rather than by the pound, which many Americans do. I suspect tariffs would be used to mostly keep the Chinese out. Of course, they could get around that by building factories in North America. BYD already builds buses in the US.
May 11th, 2023 at 4:26 pm
15 Yep, the first Hyundai sold the US, the Excel two door hatch, was simple, basic, but unreliable. A friend had one.
May 12th, 2023 at 7:39 am
16 Honestly, I don’t care even if BYD or any other Chinese company does come to the US with a decent product. I still wont be buying it. I think the competition is good for business and forces all to be better. But much like the “buy local” sentiment to support your local farmer and small businesses my whole career has been in the auto industry and so it seems silly to not support the hand that feeds me. Sure the waters have been muddied by the foreign transplants and brands like Jeep that have changed hands from American to Diamler to Fiat to Stelantis. Some would point out that everything is global now with outsourcing even an American car can have more foreign parts than US content. So does it really matter? Maybe not, but I also feel like we are cutting our own throats by supporting the cheap labor of other countries. No one seem to mind exploiting the cheaper labor of Mexico until we saw so many manufacturing jobs leave this country. Then we did the same with India and just kept moving manufacturing to wherever the labor was the cheapest. We decimated our auto industry then our steel industry then even our computer industry. If we dont support building anything here well soon enough we wont make anything here and we will have a two tier society with the wealthy and the poor. We will have outsourced all are middle income blue collar jobs. Its already happening and no signs of slowing down. So for now I’ll stick with my gas powered American made vehicles and wait and see what my options are in 2035.
May 12th, 2023 at 8:02 am
18 I wouldn’t buy a BYD either, even if they are good products, and wouldn’t buy a Chinese Buick, given all of the alternatives. I do buy European cars, though. They do not compete by using cheap labor. They compete by making products I like.
May 12th, 2023 at 8:59 am
I am sure GM wishes that they had Opel/SAAB to release their electric drive cars. Re-establishing brands in Europe is going to be extremely expensive for many years to come. Far more money will be spent to reestablish a brand in europe then would have been needed to bring opel/vauxhaul/SAAB up to speed.
May 12th, 2023 at 9:56 am
20 Opel/Vauxhall were mainly lower end cars like Corsa and Astra. It won’t be easy, but newly establishing brands like Cadillac and Buick might be better for pricey EVs, than with Opel and Vauxhall, if they still had those brands.
Maybe GM still owns the SAAB brand, if they wanted to use it. That might make sense.
May 12th, 2023 at 11:12 am
On 13 June 2012, Saab Automobile AB and its subsidiaries as well as the Saab factory had been acquired by a Chinese consortium called National Electric Vehicle Sweden (NEVS)
In 2009 Production was suspended until late 2013, when the new ownership launched a limited run of 380 2014 model year 9-3 sedans.
So I dont think GM has any ownership in Saab anymore.