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0:07 Germany Offering Free Renaults with New Subsidies
1:04 European Sales Show Improvement
1:43 U.S. Manufacturing Up, But Not Back to Normal
2:18 Nissan Cutting Global Output 30%
3:47 PSA & FCA Announce New Name
4:20 VW Sells 50% of Seat Maker Sitech
5:47 Lordstown Reveals Endurance Interior
6:34 Porsche Details New 911 Turbo
7:34 First Popemobile with Glass Bubble
8:25 More Wisconsin Barn Finds
This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
GERMANY OFFERING FREE RENAULTS WITH NEW SUBSIDIES
Well no wonder sales of the Renault Zoe surged in Europe. Last week we reported registrations were up 107% last month, the bulk coming from France and Germany. We noted that was due to new EV incentives, but we didn’t realize how generous those incentives are. In France buyers get a 7,000 euro subsidy, while in Germany it’s 9,000 euros. And Bloomberg reports a dealer chain in Germany is advertising a lease for the Zoe that is entirely covered by subsidies. In France, the Zoe can be leased for 79 euros a month. That’s not the only screaming deal. The smart EQ is available via lease in Germany for under 10 euro a month. Most EVs will likely benefit from the incentives, but this also goes to show what we’ve been saying for a while; EVs need subsidies to grow sales. Without them, sales fall off.
EUROPEAN CAR SALES SHOW IMPROVEMENT
And speaking of car sales in Europe, the numbers are still weak but the auto industry is showing signs of improvement. According to the European Auto Industry Association, automakers sold more than 1.1 million vehicles in June, which is down 24% compared to a year ago. But that’s an improvement over the 57% drop in May. All countries in Europe saw sales fall except France, which posted a 1.2% gain thanks to incentives for low-emission vehicles. Through the first half of the year, sales are down about 40% in Europe.
U.S. MANUFACTURING UP, BUT STILL NOT BACK TO NORMAL
U.S. manufacturing output increased again last month. Reuters reports it was up 7.2% in June, after increasing 3.8% in May. Here’s our Autoline Insight. Automakers have been running a lot of overtime to make up for lost production and low inventory levels. In fact, total inventory in the U.S. is 1.3 million vehicles below where it was last year. And while automakers continue to increase production, output is still over 11% below where it was in February.
NISSAN CUTTING GLOBAL OUTPUT
In other production news, Reuters reports that Nissan is cutting its global output by 30% through December due to slumping sales. The automaker will produce around 2.6 million vehicles in that timeframe, down from 3.7 million last year. The automaker was struggling before the pandemic but it’s only adding to its woes. In addition to the production cuts, back in May it was reported that the company will cut 20,000 jobs, mostly in Europe and developing countries, in an effort to turn around its profitability.
What is Michigan’s chief mobility officer’s plans for electrification, autonomy and sustainability? Those will be a few of the topics we dive into on today’s Autoline After Hours. Pete Bigelow from Automotive News will also join John and Gary on the show. That’s today at 3PM eastern time on our website or YouTube channel.
PSA & FCA TO BE KNOWN AS STELLANTIS
Once PSA and FCA merge, the automaker will be known by a new name. The two companies announced that the corporate name of the new group will be called STELLANTIS. But don’t worry, the names of the car brand’s will remain the same, the STELLANTIS name will be used exclusively at the Group level. The name comes from the Latin verb “stello,” which means to brighten with stars. The 50:50 merger between PSA and FCA is expected to be complete in the first quarter of 2021.
VW SELLS 50% OF SEAT MAKER
Volkswagen is one of the most vertically integrated automakers. Like Tesla and Toyota, Volkswagen makes a lot of basic components in-house rather than outsourcing them to suppliers. But maybe we’re starting to see VW back away from that strategy. Up to now VW made car seats in-house with its subsidiary called Sitech which has 5,000 employees and 6 factories. But VW just sold 50% of Sitech to the German supplier Brose. That will allow the seat maker to start selling to other automakers, not just VW. Here’s our Autoline Insight. Vertical integration is nothing new. Henry Ford perfected it at the Rouge plant 90 years ago, where iron ore went in one end of the manufacturing complex and Model A’s rolled out the other end. By building everything in-house automakers can eliminate the profit that suppliers would have tacked onto the cost of their components. So it can be more profitable. But not always. These days, suppliers have become so large they often have higher manufacturing volume and lower costs than automakers. Also, vertical integration is very capital intensive. And VW probably decided it was better to invest money in EVs, AVs and connectivity instead of investing it into making seats.
LORDSTOWN SHOWS PRODUCTION ENDURANCE INTERIOR
Lordstown Motors revealed renderings of the interior of its electric pickup, the Endurance. It’s a bit simple, but it looks OK and it’s important to remember that this is a commercial truck. So, it’s likely designed to take some abuse, which translates into a more utilitarian look. Lordstown says reservations and letters of intent have surpassed its first year production goal of 20,000 units, but that deliveries will be pushed back from the beginning of 2021 to the summer.
PORSCHE REVEALS NEW 911 TURBO
On the heels of the 911 Turbo S, Porsche is now introducing the 911 Turbo. The interior and body styling are very similar, so we’ll stick to the big differences. The 3.8L twin-turbo six-cylinder boxer engine in the Turbo puts out 572 horsepower and 553 lb-ft of torque, which is funneled through an 8-speed PDK transmission. In the S that engine is tuned to 640 horsepower and 590 lb-ft. Despite that gap in power, the Turbo is only a tenth of a second slower zero to sixty than the Turbo S. Then add in that the Turbo is more than $30,000 cheaper and we wonder, why anyone would buy the Turbo S? Maybe that’s because I can’t ever imagine being able to afford a vehicle over $100,000, let alone $200,000.
FIRST GLASS BUBBLE POPEMOBILE
Here’s something we think you might enjoy. The first popemobile to feature a glass bubble is now on display at the Mercedes-Benz Museum. The G-Class was modified for Pope John Paul II’s visit to Germany in 1980. It features a bench seat that sits on a raised floor, which is surrounded by artificial glass so onlookers would be able to get a view of the Pope. It was changed to bulletproof glass after an assassination attempt a year later. Other features include integrated lighting, an extended wheelbase, a 75 kW or 102 horsepower 4-cylinder gas engine and a powerful air conditioning system, so the Holy Father wouldn’t get cooked. The vehicle is part of a broader collection of G-Classes, which celebrates its 40th anniversary this year.
AT LEAST IT’S NOT A NASH
And speaking of classic vehicles, here’s another Wisconsin Barn Find. We told you it wouldn’t be a Nash. While I don’t think this will be a hard one to identify, leave your guesses in the comments, I had a much different reaction to this Barn Find than any other that I can think of. I actually wished I owned it. I would fix up the brakes, engine, trans, suspension, things like that. But I wouldn’t change a thing about the exterior. I love the patina. What do you think?
But that’s it for today, thanks for watching and please join us again tomorrow.
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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.