AD #3580 – High Car Prices Could Open Door for Chinese; Expect More EV Launch Delays; Most Powerful Range Rover Sport

  

This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.

HIGH CAR PRICES COULD OPEN DOOR FOR CHINESE IN U.S.
New car prices have gone through the roof. The average car costs almost $50,000 and that’s pushing millions of Americans out of the new car market. It’s also opening the door for inexpensive Chinese cars, especially electric ones. People say Americans will not buy Chinese cars, but that’s what they said about Japanese cars and South Korean cars and European luxury cars. But foreign automakers now have half of the American market. With lower prices, the Chinese could take over entry level cars, just like the Japanese did forty years ago. And there’s the crazy part. If and when the Chinese come into the American market with cheap EVs the ones who get hurt the most will be the Japanese and Korean car companies.

AUTO MACHINERY ORDERS BARELY UP
Automakers and suppliers are spending billions to expand and build new manufacturing facilities. The U.S. in particular saw a wave of investments not long after the IRA was passed and a lot of the growth revolves around the transition to EVs. But despite all this expansion, orders for new machinery were barely up, according to data from the U.S. Commerce Department. And we think we know why.

OEMs PREFER REFURBISHING EQUIPMENT INSTEAD OF BUYING NEW
When a car company retools a plant, it usually yanks out the old equipment and replaces it with new. But not now. When it comes to IC powertrains GM, Ford and Stellantis are trying to reuse as much old equipment as they can and refurbish it. That still involves a lot of work. The old equipment has to be shipped to companies that do the refurbishing, who have to inspect it, clean it, repair it and bring it up to new and ship it back. Using the old equipment does save some money, but replacing it with all new machinery would be so much easier. So, why do they do it? Using the old stuff means the automakers don’t have to write it off, which is an expense that reduces their net income.

 

TOYOTA MARKETING HEAVILY TO MINORITY BUYERS IN U.S.
Toyota points out that this year is the first time that white 18 year olds are no longer a majority in the US. And it’s a key reason why Toyota is marketing heavily to Black, Hispanic and Asian Americans. It thinks it has a real competitive advantage there. Toyota claims it gets the highest percentage of those buyers, and it believes that demographic change is on its side. Because the fastest growing demographic groups in the United States right now are Asians followed by Hispanics. And so Toyota is zeroing in on those groups with its marketing and advertising. It knows that the demographics of this country are going to keep changing and so it’s laying the groundwork now in the hope that it will pay off for years to come.

LAND ROVER UNVEILS MOST POWERFUL RANGE ROVER SPORT EVER
Land Rover is adding the most powerful Range Rover Sport ever to its lineup. The model is powered by a new 4.4L twin-turbo V8 gas engine that cranks out 626 horsepower and 553 lb-ft of torque. That’s 51 more horses and 38 more lb-ft of torque than the previous-gen Range Rover Sport SVR’s supercharged 5.0L V8. The new Range Rover SV moves from 0 to 60 MPH in just 3.6 seconds and has a top speed of 180 MPH. It also features some weight savings. The available 23-inch carbon fiber wheels cut nearly 80 pounds compared to the standard 23-inch cast alloy wheels. And optional carbon ceramic brakes remove another 75-pounds. And to further help the driving dynamics the new Range Rover SV comes with a semi-active suspension system that features hydraulic dampers, adjustable air springs and pitch control. But the new model is initially going to be hard to come by. The first year of production will be available to select clients and by invitation only.

ASTON MARTIN UNLEASHES NEW DB12
Aston Martin Chairman Lawrence Stroll recently said it would come out with 8 new models over the next two years and here’s the first one. This is the new DB12, which is a major evolution of the DB11. The 12 is distinguished by new lights, a bigger grille, redesigned splitter and wider front and rear tracks. Under the hood is a 4.0L twin-turbo V8 that is supplied by Mercedes-AMG, but tuned in-house by Aston. It makes 671 horsepower and 590 lb-ft of torque. That’s an impressive jump over the V8 DB11, which made 528 horsepower. Guess that’s why Aston called the 11 a ‘Grand Tourer’ but calls the 12 a ‘Super Tourer.’ The engine is mated to an 8-speed auto and, a first for Aston, the 12 features an electronic differential, which helps lay down 671 horses for a 0-60 time of 3.5 seconds. Then to reel it all in is a set of standard cast-iron brakes, but carbon ceramics are also available. The center console of the DB12 extends all the way up, blending into the dash, which creates a separate cockpit area for the driver and passenger. It houses all the vehicle controls as well as the 10.25-inch infotainment screen, which is the first in-house developed infotainment system by Aston Martin. Previously, it stuck with the system from Mercedes. And by mounting the new screen down low, it gives the driver a better view out of the windshield. No word on pricing yet, but deliveries start in the third quarter of this year.

MORE EV LAUNCH DELAYS EXPECTED
As we said early in the show, OEMs are spending billions on new manufacturing, mostly for EVs. While automakers have been perfecting the art of building internal combustion engine cars for well over 100 years, making EVs is still new to them. And we’ve seen that reflected in vehicle delays and low production output. The hope is that will turn around quickly, but according to Michael Robinet of S&P Global Mobility there’s still going to be a learning curve.

(AAH clip is only available in the video version of today’s show.)

So, hearing that, does it turn you off from EVs at all? But really, I think this could have the biggest impact on the average car buyer. They’re not as forgiving of slow launches and quality problems, which could hurt adoption. And if you’d like to catch more of that show, we’ll be sure to provide a link in the transcript and description box.

But that brings us to the end of today’s show. Thanks for tuning in and I hope you have a great weekend.