AD #2457 – German Industry in Trouble? SKODA Readies All-New Hatchback, Honda Improves Intersection Safety

On today’s show… Volkswagen’s CEO says the German auto industry could be in trouble… Ford unveils an SUV designed and engineered in China… and Honda works to stop car crashes at intersections. All that and more coming right up on Autoline Daily.

This is Autoline Daily the voice of the automotive industry.

GERMAN AUTO INDUSTRY IN TROUBLE?
We’ve talked about how the auto industry is going through a transformative change with autonomy, connectivity, electrification and ride sharing. And that is causing concern at one of the largest automakers in the world. At a conference in Germany, Herbert Diess, the CEO of Volkswagen, told the crowd “From today’s point of view, the chances are perhaps 50-50 that the German auto industry will still belong among the global elite in 10 years’ time.” He says the shift to electrification will result in fewer jobs because it takes less time to build an EV since it has fewer components. Diess says this will cost about 14,000 jobs at VW by 2020.

AUDI SLAPPED WITH LARGE DIESEL FINE
EVs and AVs are not the only challenge the VW Group faces. The diesel emissions scandal is far from over. Audi was just slapped with a nearly $1 billion fine by German prosecutors for exceeding emission limits in six and eight-cylinder diesel engines. And Audi knows it’s guilty. The company says it accepts the punishment and will not appeal the fine.

FORD GAINS MARKET SHARE IN EUROPE
As we reported before, car sales fell off a cliff in Europe over the last few months. That’s because so many vehicles failed to meet emissions standards because of new test procedures, what they call the WLTP. But not all automakers failed the tests. While sales fell over 8% in Europe, Ford gained market share because its vehicles meet the standards. Ford’s SUVs were up nearly 9% in September and commercial vehicles had a healthy gain of 7%. Passenger car sales continue to slide. They were down nearly 15% last month.

FORD INTRODUCES NEW SUV FOR CHINA
But it’s a bit of a different story for Ford in China. An aging lineup and an increased tax on U.S. imports have crippled Ford’s sales in the country. To counteract that, it plans to introduce 50 new models in China by 2025, including a soon to be released all-new mid-size SUV, called the Territory. We reported on this model back in August and there’s not a whole lot of new information, unless you want to learn more about its infotainment and driver assistance technology. But it should help Ford gain ground. Sales of mid-size SUVs increased 102% in China between 2015 and 2017.

Coming up next, why Merrill Lynch is so bullish on Ferrari’s stock.

SKODA READIES NEW EUROPEAN HATCHBACK
SKODA is getting ready to debut an all-new model before the end of the year and is providing a few details about the car. It’s a compact hatchback, called SCALA, which is the Latin word for ‘stairs’ or ‘ladder’ and will ride on parent company VW’s MQB platform. Styling will take inspiration from the VISION RS concept that debuted at the Paris auto show in October. And it will also be the first SKODA model in Europe to have the brand name spelt across the tailgate, rather than feature the company logo.

CHINA’S NIO EXCEEDS EXPECTATIONS
Chinese EV maker NIO, which is backed by Tencent, revealed it delivered over 3,200 electric SUVs in the third quarter. The company says it’s on track to hits its delivery goal of 10,000 units in the second half of this year. That’s pretty good growth for a startup.

SHORT SELLERS GO AFTER ASTON MARTIN
Elon Musk complains bitterly about investors who short Tesla’s stock, but he’s not the only one in trouble with shorts. They’re also going after Aston Martin. Investors who short a stock are betting that the price will go down. And Aston Martin’s stock price is down 20% since the company went public last month, meaning anyone who shorted the stock has earned a tidy profit.

MERRILL LYNCH BETS ON FERRARI
Meanwhile, Merrill Lynch is adding Ferrari to its list of best investments. It predicts that Ferrari’s earnings will double by 2022, but could go even higher since those estimates do not include Ferrari’s upcoming SUV or new hypercar. Even though Ferrari’s stock fell sharply after the company’s CEO Sergio Marchionne died, Merrill Lynch says it represents a good time to buy the stock.

Wouldn’t it be great to stop car crashes at intersections? Coming up next, we’ll show you how Honda plans to do that.

HONDA TESTS V2X IN OHIO
Roughly 40% of all accidents in the U.S. occur at intersections and they’re the sight of 20% of traffic-related deaths each year. Connected and autonomous vehicles are expected to greatly improve safety, but due to obstacles in their way these types of vehicles will still encounter situations where they can’t “see” other motorists or pedestrians. So, Honda is testing a Smart Intersection in Marysville, Ohio and is showing how a connected vehicle might be warned of a potential conflict. And here Jim Keller, Chief Engineer of Research and Development at Honda describes how the system works.

(Clip from Honda Smart Intersection can only be viewed in the video version of today’s show.)

And if you’d like to learn more about Honda’s Smart Intersection you can watch that entire video on our YouTube channel. Just look for the Autoline Network.

And that wraps up today’s report. Thanks for watching and please join us again tomorrow.