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Runtime: 11:21
0:08 U.S. Car Sales Off to Solid Start
1:10 Car Sales Plunge in Germany
1:40 Kia & Apple Partnership Rumors Heat Up
3:57 Sandy Munro Sits Down with Elon Musk
7:00 Panasonic Expects Tesla Business to Be Profitable
7:32 Google Partnership Could Generate Billions for Ford
8:51 Ford Reveals Updated F-150 Raptor
10:01 GM Secures 2nd Customer for New BrightDrop Business
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U.S. CAR SALES OFF TO SOLID START
Car sales in the U.S. look like they’re off to a solid start for 2021. Ward’s Intelligence reports that automakers sold just over 1 million vehicles, up a fraction from a year ago on a daily selling rate basis. The SAAR came in at 16.6 million versus 16.8 million a year ago. For some automakers it was a fantastic month. Volvo was on a tear with sales soaring for all its models. Kia, BMW, and Mazda all enjoyed double digit growth. And Hyundai rounded out the top 5 gainers. But it was a terrible month for Mitsubishi, which dropped 40%. Tesla saw a 78% drop in sales of the Model 3 which dragged down its overall numbers. The Model Y failed to make up for that loss. JLR slid more than 10% while Nissan and Honda rounded out the top 5 losers.
| U.S. Light Vehicle Sales – January, 2021 | ||
|---|---|---|
| Sales | 1,095,000 | +0.3% |
| SAAR | 16.6 M vs. 16.8 M | |
| Top Gainers | ||
| Volvo | 8,300 | +40.7% |
| Kia | 45,000 | +16.1 |
| BMW | 22,200 | +13.7 |
| Mazda | 25,259 | +11.4 |
| Hyundai | 46,217 | +9.1 |
| Biggest Losers | ||
| Mitsubishi | 6,140 | -40% |
| Tesla | 17,500 | -13.6 |
| JLR | 8,120 | -10.2 |
| Nissan | 70,450 | -8.0 |
| Honda | 92,220 | -5.5 |
| Source: Wards Intelligence | ||
CAR SALES PLUNGE IN GERMANY
While U.S. car sales may be off to a decent start, they sure look bleak in Europe. Reuters reports that registrations for new passenger cars in Germany plummeted 30% in January. That’s because of a second coronavirus lockdown, plus tax breaks for consumers were phased out at the end of 2020. But it’s not just Germany. Economists are worried that the slow rollout of vaccines could push Europe into a recession.
KIA & APPLE PARTNERSHIP RUMORS HEAT UP
Kia’s stock jumped 10% on a newspaper report out of South Korea that it will make electric cars for Apple. The report says Kia will make 100,000 EVs a year for Apple starting in 2024 at its assembly plant in West Point, Georgia, and could ramp that up to 400,000. But we say, take all this with a grain of salt. Here’s our Autoline Insight. We think it’s more likely that Apple would sign a deal with Hyundai Mobis, which is the in-house parts supplier of the Hyundai Group. Mobis already makes the rolling chassis for the Jeep Wrangler and Gladiator right next door to the Jeep plant in Toledo. We think it would build a plant just for Apple, maybe next door to that Kia plant in Georgia. We’ll know more of what’s going on in two weeks. That’s when Apple and Kia will reportedly sign the deal.
SANDY MUNRO SITS DOWN WITH ELON MUSK
Our favorite tear-down expert, Sandy Munro had a wish come true and got to interview the richest person in the world, Elon Musk. Sandy posted the nearly 50-minute-long conversation on his YouTube channel and there’s a lot of great moments, like Elon calling seats in early Model S’s ‘stone turd stools’ and comparing current battery packs to sacks of potatoes. But we found Musk’s candidness about some of Tesla’s issues to be refreshing. As many of you know, the Model Y features a single-piece rear structure casting, which is way less than the 70 pieces in the Model 3, even though the vehicles are based on the same architecture. So, how did Tesla get to that Frankenstein’s mess? Musk explains:
(Video clip is only available in the video version of today’s show.)
Musk goes on to say that trying to seal up all those panels is probably the most painful job in the whole factory. The Model 3 will eventually get that rear casting but not until Tesla’s new production sites in Berlin and Texas are complete because it sounds like retooling the body shop for it would hurt the company’s profitability. The casting reduces the size of the body shop by 30% and removes 300 robots from the line. Musk says there will eventually be a front casting as well, which will remove another 300 robots, and that the front and rear castings will feature a structural battery pack in between. There’s even more great information in the video and we recommend giving it a watch.
PANASONIC EXPECTS TESLA BUSINESS TO BE PROFITABLE
After forming a partnership a decade ago, Panasonic says its Tesla battery business will be profitable this year for the first time and raised its full year operating profit forecast by more than half. Starting in April, Panasonic will begin test production for Tesla’s 4680 battery cells at the company’s factory in Nevada. The new battery is expected to cut Tesla’s battery costs in half and increase battery production 100-fold by 2030.
GOOGLE PARTNERSHIP COULD GENERATE BILLIONS FOR FORD
Maybe that story we reported yesterday of Ford and Google teaming up on connected car services is more significant than we realized. Auto analyst Adam Jonas at Morgan Stanley says that could generate $9 billion more a year in revenue for Ford and drop $5 billion to the bottom line. Here’s how he came to that number. Ford has 75 million vehicles on the road. If each one generated $10 a month in subscriptions, it comes to $9 billion. Jonas is estimating a 55% pre-tax margin to get to the $5 billion in profits. Obviously, it’s going to take Ford years to get there, and Adam Jonas is under no delusions. He says that Ford stock, which is currently trading just under $11 a share, will drop to $9.
FORD REVEALS UPDATED F-150 RAPTOR
Ford introduced the updated F-150 Raptor and styling falls right in line with that of the more standard truck, but still retains the Ford name in big block letters on the front and back. The biggest change to the Raptor is probably the new 5-link rear suspension setup that provides more wheel travel than ever before. It consists of extra-long trailing arms, a Panhard rod and 24-inch coil springs. The truck also features a new generation of FOX shocks, which have larger diameter tubing. It’s still powered by a twin-turbo 3.5L V6, but Ford made some tweaks to increase low-end torque and improved Raptor’s payload and towing capacity. Like the rest of the F-150 lineup, the Raptor will come with the SYNC 4 infotainment system, which allows for over-the-air updates and the ability to share trail maps with other users. The new F-150 Raptor will be available this summer, but not to be outdone by the Ram TRX, Ford says a Raptor R is coming out next year.
GM SECURES 2ND CUSTOMER FOR NEW BRIGHTDROP BUSINESS
General Motors has already secured its second major customer for its new Brightdrop EV600 electric commercial vans. Merchants Fleet, a fleet management company, is ordering 12,600 vans, which will enter its fleet starting in early 2023. FedEx is Brightdrop’s first customer and the delivery service will start receiving vans by end of this year. As we reported yesterday, GM will start producing the EV600 in September at its Warren Tech Center outside of Detroit.
We’ve got a great Autoline After Hours coming up tomorrow with Tony Roma, the chief engineer for Cadillac’s CT4 and CT5-V Blackwings. No doubt you’ve got questions about what could be the last hurrah for high performance piston engine cars from General Motors. So send your comments and questions to [email protected], or tweet them to us @Autoline.
But that brings us to the end of today’s show. Thanks for watching.
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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.
