0:28 GM Ready to Mass Produce AVs
1:02 Porsche Sets Sales and Revenue Records
1:28 Audi R8 On the Chopping Block
2:14 PSA Hopes SUV Can Save DS Brand
2:55 Yellow Cars Hold Value
4:09 Ford Uncovered
On today’s show…Ford is all but abandoning the passenger car market…GM makes a major investment to manufacture autonomous cars…and Porsche puts a mountain of euros on the bottom line. All that and more coming right up on Autoline Daily.
This is Autoline Daily the show for enthusiasts of the automotive industry.
GM READY TO MASS PRODUCE AVs
GM keeps making significant progress with its autonomous technology. And now it’s investing $100 million to upgrade two plants to build self-driving Chevy Bolts next year in volume. Its Orion, Michigan plant will assemble the AVs, while its Brownstown, Michigan plant will make the roof modules with all the sensors. GM also makes battery packs at that plant. GM already made some autonomous Bolts at its Orion plant, but now it’s ready to mass produce the first ever production cars without steering wheels or pedals.
PORSCHE SETS SALES AND REVENUE RECORDS
Man does Porsche know how to make money. 2017 was a record year for the company. It sold over 246,000 vehicles globally, up about 4%. That pushed revenues to 23 and half billion euros, up 5%. Its operating profit jumped 7% to 4 billion euros and its net profit soared nearly 20% to 3 billion euros.
|PORSCHE 2017 EARNINGS|
|Operating Profit||€4.1 B||+6.9%|
|Net Profit||€3.1 B||+18.9%|
AUDI R8 ON THE CHOPPING BLOCK
Audi’s flagship sports car is on the chopping block. Car and Driver reports that Audi doesn’t have any plans to replace the R8 once the current generation ends. The company is working on a turbocharged V6 version, so it’s going to stick around for a few more years. But it looks like its long-term chance for survival is on life support.
Did you know that the color of your car can affect its residual value? That’s coming up next.
PSA HOPES SUV CAN SAVE DS BRAND
The PSA Group launched the more luxury DS brand in 2010, but it’s never really caught on. Sales dropped the last 5-years in a row, falling a whopping 39% just last year alone. But PSA says the sales slump will end this year thanks to its first proper SUV, the DS 7 Crossback. It’s a completely new model, developed from the ground up by DS and it went on sale last month. Orders for the vehicle are already ahead of expectations and that helped push sales up ever-so-slightly in February. The DS 7 is the first of a new-generation of DS vehicles that is being launched in the years to come.
YELLOW CARS HOLD VALUE
Dealers typically keep bland colored cars in stock, but if you want a more fun color it’s worth your time to wait. ISeeCars.com looked at sales of over 2.1 million used cars from the 2014 model year and found color played a big role in depreciation rates. The average vehicle depreciates at 33.1% over 3-years, but yellow vehicles are well below that at 27%. That means a yellow vehicle is worth over $2,200 more at the end of three years. Orange and green vehicles also beat out the average, but stay away from beige, purple and gold. They were at least 10% higher than the average depreciation rate.
Coming up next, we’ll tell you how and why Ford is going to drop most of its passenger cars.
Ford is pretty much going to throw in the towel on passenger cars. In a major media announcement yesterday the company said that in only two years’ time 86% of its sales in the U.S. market will be crossovers, SUVs and pickup trucks. Lincoln is also going to get 6 new SUVs, starting next week at the New York auto show with the Aviator which is based on the Explorer. Ford currently has one of the oldest lineups in the market. The average age of its vehicles is nearly 6 years old. But in the next two years that will drop to about 3 years old. Ford did not announce which passenger cars it will get rid of, but that percentage suggests the only cars it will keep are the Mustang, the Fusion and the Continental.
To protect itself in case gasoline prices go up, all those truck models will be offered as hybrids, including a plug-in F-150 hybrid. By 2021 Ford brags that it will sell more hybrids than Toyota.
It’s also going to make 4G LTE standard on all models by the end of 2019, it will start rolling out over-the-air update capabilities in 2020. And in 2020 it will also make a suite of safety equipment standard under the brand name Co-pilot 360. That includes automatic emergency braking, blind spot detection, lane keeping, a backup camera and automatic high beams.
Company execs also showed the media 9 new models that will come out in the next two years, but they did that on an off-the-record basis, so we can’t tell you what we saw. But we can tell you this. Car companies only show off future product when they’re in trouble. And while Ford is financially stable, its stock price has gone nowhere despite the strongest bull market in history.
Moreover, the company only talked about the U.S. market. We didn’t hear anything about its operations in Europe, Latin America or China. So much for One Ford. And we still don’t have any idea on how Ford is going to make money on autonomous cars or mobility services. Obviously Ford doesn’t want to tip off the competition about all its future plans. But yesterday’s event, called Ford Uncovered, sure left a lot of the company’s future all covered up.
And with that we wrap up this week’s reports. Thanks for making Autoline Daily a part of your day, we’ll see you next week and don’t forget to celebrate St. Patrick’s Day.
Thanks to our partner for embedding Autoline Daily on its website: WardsAuto.com
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.