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Runtime: 9:45
0:08 Toyota, Honda & GM Post Strong Earnings
1:27 Used Vehicles Help VW Finance Hit Profit Goal Ahead of Schedule
2:25 EVs Need More Maintenance During 1st Year of Ownership
4:13 U.S. July Car Sales Drop
5:11 Nissan Cuts LEAF Pricing in U.S.
6:00 Toyota Drops Avalon From U.S. Lineup
7:22 Nikola Cuts Annual Outlook
7:59 COPO Camaro Not Heading to China
8:24 Can You Guess What Car This Is?
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TOYOTA, HONDA & GM POST SOLID EARNINGS
We’ve got more earnings pouring in and today it’s Toyota’s, Honda’s and GM’s turn. Let’s start with the Japanese automakers, which posted first quarter earnings for their fiscal year. Toyota sold more than 2 million vehicles, brought in more than $72 billion in revenue and posted a healthy net profit of $8 billion. Honda sold just under 1 million automobiles, which helped its revenue reach nearly $33 billion and its net profit came in at $2 billion. Those are good numbers for the companies, however both are warning that chip shortage will likely impact earnings in the second half of the year.
| Toyota Q1 FY2022 | |
|---|---|
| Sales | 2,148,000 |
| Revenue | $72.1 Billion |
| Net Profit | $8.2 Billion |
| Source: Toyota | |
| Honda Q1 FY2022 | |
| Sales | 998,000 |
| Revenue | $32.9 Billion |
| Net Profit | $2.04 Billion |
| Source: Honda | |
General Motors first half earnings also look good. The company sold more than 3.5 million vehicles. Its revenue topped $66 billion and its net profit was just shy of $6 billion. GM attributes its strong performance to prioritizing production of its most popular models during the chip shortage and gaining market share in the full-size pickup segment in the U.S. And thanks to high used vehicle prices due to low inventories, GM Financial had record results.
.tg {border-collapse:collapse;border-spacing:0;} .tg td{border-color:black;border-style:solid;border-width:1px;font-family:Arial, sans-serif;font-size:14px; overflow:hidden;padding:10px 5px;word-break:normal;} .tg th{border-color:black;border-style:solid;border-width:1px;font-family:Arial, sans-serif;font-size:14px; font-weight:normal;overflow:hidden;padding:10px 5px;word-break:normal;} .tg .tg-amwm{font-weight:bold;text-align:center;vertical-align:top} .tg .tg-0lax{text-align:left;vertical-align:top}| GM H1 2021 | |
|---|---|
| Sales | 3,502,000 |
| Revenue | $66.6 Billion |
| Net Profit | $5.9 Billion |
| Source: General Motors | |
USED VEHICLES HELP VW HIT PROFIT GOAL AHEAD OF SCHEDULE
The global chip shortage is really putting a clamp on the production of new vehicles, which means there’s not enough inventory to fill dealer lots, which means many buyers are turning to used vehicles, which means prices for those vehicles are skyrocketing, which means good news for automakers with finance companies. According to Bloomberg, Volkswagen’s Financial Services arm expects to reach an operating profit this year of 4 billion euros, thanks to higher prices on used vehicles. That’s 4 years ahead of schedule. It originally planned on reaching that earnings target in 2025. And it hopes to keep the momentum going. While the chip crunch shows signs of waning, because used vehicles are still in such high demand, VW is able get an additional leasing cycle out of certain models.
EVs NEED MORE MAINTENANCE DURING 1ST YEAR OF OWNERSHIP
Electric cars are supposed to need a lot less maintenance and repairs than IC cars. But that’s not how it’s working out in the real world, at least so far. A company called We Predict that analyzes data from automakers and insurance companies found that EVs need more work during the first year of ownership. And some of its findings are shocking. After only three months of ownership the average Mustang Mach-E needs $98 of repairs or maintenance, the Audi e-Tron needs $366 worth, a Porsche Taycan comes in at $667 and the Jaguar I-Pace is at $834. We Predict found that the main problems involve the charger, and charger cables, wiring and wheels. The good news is that after two years of ownership, an EV is 27% cheaper to maintain and after three years it’s 65% cheaper.
| Cost of Maintenance/Repairs After 3 months | |
|---|---|
| Mustang Mach-E | $98 |
| Audi e-Tron | $366 |
| Porsche Taycan | $667 |
| Jaguar I-Pace | $834 |
| Source: We Predict | |
U.S. JULY CAR SALES DROP
Automakers posted sales for July and they’re as dismal as analysts were expecting. According to Wards Intelligence, the SAAR or seasonally adjusted annual rate, was 14.75 million, slightly better than last year but down from June’s 15.4 million SAAR. It’s the third month in a row it dropped due to tight inventories caused by the chip shortage. In total, automakers sold just under 1.3 million units in July, which is only a 0.3% improvement compared to last year and an 8% drop from June on a daily selling rate basis. And it looks like sales won’t recover this year. LMC Automotive cut its outlook from 16.9 million to 16.6 million sales this year due to low inventories caused by the chip shortage.
NISSAN CUTS LEAF PRICING IN U.S.
Nissan is cutting the price of the Leaf in the U.S. to make it more competitive. The base model with a 40-kWh battery pack has a starting MSRP a little over $28,000, including destination, which represents a drop of more than $4,000. And it’s more than $5,000-grand off the base Leaf S Plus with a 62-kWh pack. That’s before any tax breaks or incentives. In addition to the price cuts, all models come standard with a CHAdeMO Quick Charge Port and 240-volt charging cable, while some higher-grade versions come standard with more advanced technologies. The 2022 Leaf is on sale now.
TOYOTA DROPS AVALON FROM U.S. LINEUP
Toyota is giving the Avalon the old heave ho in the U.S. Despite arriving In the market in 1994, production will end after the 2022 model year. Toyota has sold a little more than 11,000 Avalons through the first six months of the year, which makes it Toyota’s worst selling sedan by a pretty wide margin, if you don’t include the Mirai. The Avalon is made at Toyota’s U.S. plant in Kentucky, so it’s departure should clear the way for something new.
NIKOLA CUTS ANNUAL OUTLOOK
Things are looking worse for EV truck startup Nikola. Due to supply chain issues, it slashed its revenue forecast for the year from a high of $30 million down to just $7.5 million and halved delivery estimates. It now expects to deliver between 25 and 50 trucks. And we wonder if it will even be able to hit those goals. The company says the indictment of former chairman Trevor Milton is a “potential distraction” and it’s stock was down more than 7.5% yesterday.
COPO CAMARO NOT HEADING TO CHINA
Turns out I was reading a little too deeply into the COPO Camaro being featured on GM’s China website. A spokesperson told us that the dragster will continue to only be sold through its U.S. dealers, but once purchased, the owner can take it wherever. And I for one would like to see a big block COPO in China.
CAN YOU GUESS WHAT CAR THIS IS?
All right Autoline viewers, you’ve been challenged. Someone wrote us an email with the title “Not Exactly A Barn Find But…” and goes on to talk about a piece of automotive history that “I am sure will stump all of your North American viewers.” Here’s the vehicle in question and a few basic details. It features an aluminum body over a steel chassis and is powered by a V8 engine. We already know what the answer is, but do you? The gauntlet has been thrown down. Pride is on the line, folks. Let’s show this person how deep your automotive knowledge runs.
But that wraps up today’s show. Thanks for watching and we hope to see you again tomorrow.
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Seamus and Sean McElroy cover the latest news in the automotive industry for Autoline Daily.
