Listen to “AD #2823 – Non-Union U.S. Plants Could Open First; Europe Passes China in Q1 EV Sales; Genesis G70 Impressions” on Spreaker.
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0:07 VW Group Ramping Up Production
0:58 Non-Union U.S. Plants Could Open First
1:50 People Staying Away From Mobility Services
2:52 China Continues to Slash EV Subsidies
4:00 Europe Passes China in Q1 EV Sales
4:50 Bentley Owners Not Happy with Continuation Models
5:41 Hyundai Gives Prophecy the Green Light
6:30 A Few Escalade ESV Details
6:58 MINI Changes Name of ‘Corona Spoke’ Wheels
7:14 Genesis G70 Impressions
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It looks like the virus crisis has peaked in Europe and automakers are slowly starting to open some plants.
VW GROUP RAMPING UP PRODUCTION
The Volkswagen Group is figuring out ways to ramp up production. We already reported how SEAT would test workers for COVID-19 in Spain and now VW is opening up its plants in Slovakia. VW says it’s employing about 100 protective safety measures to keep workers healthy. Next week it will open plants in Germany, Portugal, Spain, Russia and the U.S. And Skoda will restart production in the Czech Republic next week. On top of 80 safety measures, the company modified the way staff shuttles operate, changed procedures wherever people can congregate, like the factory gates as well as how working hours are recorded.
WILL NON-UNION PLANTS START FIRST IN THE U.S.?
Meanwhile in the ‘States there’s a split brewing over when production should restart. Toyota, Tesla, Hyundai and Volkswagen, announced plans to slowly ramp up production the first week of May. GM, Ford and FCA also want to resume production around the same time. They’re asking some workers to return next week to prep work areas for restarting production. However, UAW President Rory Gamble says it’s too early to restart production. About two dozen UAW workers have died from the virus and union leadership says it’s too risky to start so soon. This will be interesting to see how it plays out. If the non-union shops successfully get going with no additional virus cases, there will be enormous pressure on the UAW to allow production to resume.
PEOPLE STAYING AWAY FROM MASS TRANSIT
Could the coronavirus convince more people to buy a car instead of using mass transit or ride hailing? That’s what some experts think. With the pressure to maintain social distancing, and most people more than willing to do it, few people want to board crowded busses, trains or subways. Bloomberg reports that In the first two weeks of April, Cars.com found that 20% of people searching for a car said they don’t own one and have been using public transit or ride hailing. In the U.S., ridership on public transportation is down 70% due to the virus crisis. As we reported earlier this week, General Motors shut down Maven, its car sharing business.
CHINA WILL CUT EV SUBSIDIES EVEN MORE
China wants to dominate the EV industry, but it’s not going to do it with subsidies. Instead, automakers are going to do the subsidizing. Last year China cut EV subsidies and sales dropped immediately. Now, Bloomberg reports China will cut subsidies by another 10% this year, another 20% next year and 30% the year after that. Yet, it’s keeping its mandate in place for automakers to hit specific market share targets. So they’ve got to sell EVs, or else. And wait, it gets tougher still. The subsidies that remain will only apply to cars that cost less than $42,400, have a range of at least 300 kilometers, or have swappable standardized batteries. And China will phase out those subsidies once EV sales hit 2 million vehicles. Analysts say this will make it hard to sell EVs and could especially hurt Tesla and VW, since they invested so heavily to sell EVs in China.
EUROPE PASSES CHINA IN Q1 EV SALES
Here’s something we didn’t expect. Europe topped China in sales of EVs in the first quarter of the year. According to PwC, the top 5 European markets, Germany, France, Italy, Spain and the U.K., registered 79,300 EVs during Q1, which was about 2,000 more than in all of China. However, China’s sales dropped by more than half in the quarter due to coronavirus lockdowns, but those restrictions are easing, at the same time lockdowns in Europe remain in place, so PwC expects China to retake the lead in EV sales later this year. But over the next few years, analysts say it will be a neck and neck race between the two regions for the EV sales crown.
BENTLEY OWNERS NOT HAPPY WITH CONTINUATION SERIES
How do you piss off the rich? Mess with their money! Several Bentley owners, including Ralph Lauren, were none too pleased when the automaker announced last year that it would build 12 continuation cars of the 1929 Team Blower race car. Only 4 of the originals are around today and one sold in 2012 for about $7 million. But the owners are worried these new replicas will devalue their cars. Bentley points out it talked to a lot of people about the continuation cars and the vast majority were excited about the new cars. Plus, they’re not allowed to painted in the same schemes as the originals.
HYUNDAI GIVES PROPHECY THE GREEN LIGHT
We were smitten by the styling of Hyundai’s sleek Prophecy concept car, but figured it would never make it to production. Well we were wrong. It’s getting the green light. Hyundai’s head of global design, SangYup Lee told Auto Express, “There will be a production version of Prophecy coming after a production version of the 45 concept.” This is the 45 concept if you don’t remember, a wedge-y electric SUV shown last year. Both ride on a new EV platform that will spawn a number of vehicles. But Mr. Lee says they will all look and function differently from each other. The thing that will tie them all together is the lighting. The pixel lamp lights we see on the Prophecy will be used in some way on all the vehicles.
A FEW CADILLAC ESCALADE ESV DETAILS
Speaking of new vehicles, here’s the long-wheelbase version of the all new Cadillac Escalade, called the ESV. While it’s nearly 16-inches longer than the standard length Escalade they look pretty much the same. The accent behind the rear door rakes further forward and the rear doors are slightly larger. Cadillac says orders for the new Escalade can be made online today and they’re scheduled to start hitting dealerships this fall.
MINI CHANGES NAME OF ‘CORONA SPOKE’ WHEEL
I’m sure you’ve seen these wheels from Mini before. But did you know they are called ‘Corona Spoke’ wheels? That’s not really the best name in today’s environment so Mini is making a name change. This wheel design will now carry the name ‘Power Spoke.’
GENESIS G70 IMPRESSIONS
I’ve been test driving a Genesis G70 this week, and all I can say is watch out BMW 3-Series, Genesis has you right in its crosshairs. From a size, packaging and even styling standpoint the rear-drive G70 hits all the hot buttons that would directly appeal to a 3-Series buyer. There’s a reason this sedan looks like it was designed and developed in Europe. The top designers and engineers at Genesis are European. And this is not some kind of cheap knock off. It’s a well crafted car. The interior is a bit busy, but it also shows off the craftsmanship that went into this car. All the gaps between the buttons on the steering wheel, console and instrument panel are only 1 millimeter wide. The leather wrapping on the IP and steering wheel is meticulously placed. The diamond-shaped quilted seat and door insets are perfectly stitched. Even the lip of the cupholder bezel is intricately tooled and turned. Under the hood it’s powered by a 2-liter turbo, which is very well damped down from an NVH standpoint. It develops 252 horses and 260 pound feet of torque and that power is directed through an 8-speed automatic that bangs off shifts with alacrity. The G70 feels very well balanced between the steering, braking and chassis. It’s a car that encourages you to toss it into a corner. The base price of the G70 is about $36,500 and comes well equipped, the one I drove had the Prestige trim level, which adds almost $8,500 in options, including some things that I would expect to be standard, like heated front seats and parking distance warning. Put it all together, along with a nearly $1,000 destination charge and the price almost comes to $45,000. It’s rated by the EPA at 25 miles to the gallon, but surprisingly it doesn’t have a NHTSA safety rating. Maybe that’s because Genesis only sold 12,000 G70s in the US last year, about 1,000 a month, and NHTSA doesn’t crash test low volume cars. Overall I really liked this car, but question whether it will pry people out of their BMWs, Mercedes and Audis. After all, the G70 fits in the prestige segment, where brand heritage counts more than good design and engineering. And Genesis has a ways to go to burnish its brand image.
And with that we wrap up this week’s reports. Have a healthy and safe weekend, and we’ll be back here on Monday.
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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.