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Runtime: 9:12
0:07 Geely’s Profits Plummet
0:34 Correlation Between Airbags and Heatstroke Deaths
1:31 Tesla Capex Spending Down as A Percent of Revenue
2:24 Hyundai Reveals i30 N Project C
2:53 Japanese Full-Size Trucks Are a Flop in The U.S.
3:38 Mercedes Struggling to Sell X-Class Pickup
4:23 Jim Dunne Was One of a Kind
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This is Autoline Daily reporting on the global automotive industry.
GEELY’S PROFITS PLUMMET
Sales of new cars are dropping in China and it’s starting to really affect the bottom line of car companies there. Geely, which owns Volvo and 10% of Daimler, reports that its sales fell 15% in the first half of the year. Its revenue fell 11%, but its net profits plummeted 40% to about $568 million. No doubt we’ll hear about this happening with other car companies in China.
CORRELATION BETWEEN AIRBAGS AND HEATSTROKE DEATHS
The number of children dying from heatstroke when they are left in cars is on the rise. Last year, 52 kids died. So NHTSA kicked off a Twitter campaign reminding parents to check the backseat before leaving the car. Amazingly, there is a direct correlation between airbags and kids getting left in cars. When airbags for front seat passengers were first introduced in the early 90’s, parents had to put their kids in the backseat, so they wouldn’t be harmed if the airbag deployed. Check out this chart from KidsAndCars.org. The airbag deaths are represented by the little red squares and heatstroke deaths are the yellow bars. As you can see, as airbag deaths fell, the number of children dying in cars continues to grow. Automakers have started to offer back seat reminders in vehicles which seems like a good way to help fight the problem.
TESLA CAPEX SPENDING DOWN AS A PERCENT OF REVENUE
Yesterday we reported that Tesla is lowering how much it spends on R&D as a percentage of its revenue. And the same goes for its capital investments in plants and equipment. Tesla’s spending is now more in-line with traditional automakers, though it could spend more as it borrows money in China to pay for its new assembly plant there. But it’s also likely that Tesla is spending proportionately less money on R&D and Capex to drop more money to the bottom line. Elon Musk promised shareholders that the company will be profitable by the 4th quarter of this year.
TESLA CAPEX SPENDING | ||
---|---|---|
Capex | % of Revenue | |
FY 2014 | $969 M | 30% |
FY 2015 | $1.6 B | 40% |
FY 2016 | $1.3 B | 18% |
FY 2017 | $3.4 B | 29% |
FY 2018 | $2.1 B | 9.8% |
H1 2019 | $529 M | 4.8% |
Source: Tesla |
HYUNDAI REVEALS i30 N PROJECT C
Hyundai is coming out with a limited-edition version of the high-performance i30 N that will make its debut at the Frankfurt auto show. Called the i30 N Project C, it will have carbon-fiber components, unique 19-inch wheels and aerodynamic upgrades. We’d also expect to see a few unique touches on the interior as well. Only 600 of the Project C will be made and it goes on sale in select European markets later this year.
JAPANESE FULL-SIZE TRUCKS ARE A FLOP IN THE U.S.
While Americans can’t seem to get enough of the mid-size pickups from Japanese automakers, they absolutely shun their full-size trucks. According to data from WardsIntelligence, the highest market share Toyota has seen with Tundra was 9.1% and that was in 2007. It currently hovers in the 5% range. It’s even worse for Nissan. The best the Titan was able to muster was 3.5% of the market in 2005. Today it’s at 1.5%. With the Detroit Three commanding 94% of full-size pickup sales this year, it might almost make more sense for Toyota and Nissan to share a large truck platform.
MERCEDES STRUGGLING TO SELL X-CLASS PICKUP
But if the Mercedes X-Class is any indicator, that won’t work either. It’s a rebadged and upgraded version of the Nissan Navara pickup and went into production in 2017. But sales have been so poor, it sold less than 17,000 units last year between Australia, Europe, Latin America, and Africa, that Mercedes could drop the truck altogether. The head of the automaker’s van division said it’s “looking at what we have and what we could have.” Meaning the truck could be headed for the chopping block in less than 3 years.
JIM DUNNE WAS ONE OF A KIND
Jim Dunne was probably the best-known spy photographer in the automotive business. Unfortunately, he just passed away, and in remembrance of him we want to show you this clip from Autoline This Week when Jim explained one of the tricks he used to get some of his best spy shots.
(The Jim Dunne clip is only available in the video version of today’s show.)
Jim Dunne was one of a kind.
And that wraps up today’s show.
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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.