AD #3597 – Lordstown Goes Bankrupt; Tesla Should Start Its Own Finco; Chinese Could Clobber Legacy OEMs

  

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

LORDSTOWN GOES BANKRUPT
Two years ago EV startups were all the rage on Wall Street. Today, it’s a different story. Lordstown Motors just filed for Chapter 11 bankruptcy. And it’s hoping someone will buy the company. It also filed a lawsuit against Foxconn, accusing it of breach of contract. It claims Foxconn is refusing to purchase additional shares in the EV maker as promised and that it misled the company about collaborating on vehicle development. The two companies signed a $170 million investment deal but so far Foxconn has only handed over $52 million. Foxconn says Lordstown breached their agreement when its shares fell below $1 and that’s why it’s withholding the rest of the investment. This will be an interesting court case, but it looks like the end of the road for Lordstown Motors.

TESLA SHOULD START ITS OWN FINCO
Last year Ford Credit, the in-house finance arm of the Ford Motor Company made a $2.6 billion profit. GM Finance made a $3.8 billion profit. In-house finance companies, or what they call fincos, can make a lot of money, which is why Morgan Stanley says that Tesla should start its own finco. Up until now many Tesla customers have paid in cash, but if Tesla wants to ramp up to its ultimate goal of selling 20 million cars a year, it’s going to have to go after customers who need to finance a car with monthly payments. Morgan Stanley says Tesla has the cash flow to start its own finco and could make a lot of money by offering financing to those customers.

LEGACY OEMs COULD GET CLOBBERED BY CHINESE
Legacy automakers better get rid of their legacy mindset or they’re going to get clobbered by the best Chinese EV startups. That’s according to Alix Partners, which says legacy automakers are too engineering driven instead of being customer focused and they’re slow to catch on to the things their customers really care about. For example, traditional car companies will delay a program to perfect ride-and-handling and NVH, which is important, but isn’t as important to customers as consumer-electronics technologies and driver assistance features. Alix Partners says the traditional approach to product development and sourcing has led to inflexible and slow product launches. Worse still, it says legacy automakers are asking traditional teams to develop software-defined vehicles, who have little experience in doing that. Alix Partners says the legacies better radically change their business model or they’re not going to be ready for Chinese-style competition.

TOP 10 GLOBAL SUPPLIERS
Automotive News released its annual rankings of the top automotive suppliers in the world. And Bosch is once again number 1 with over $50 billion in global revenue in 2022. Its followed by Denso, ZF and Magna. And thanks to the growth in electric vehicles, Chinese battery maker CATL made the top 10 for the first time, coming in at number 5. It made about $33 billion in 2022, which is more than double the year before. And rounding out the top 10 is Hyundai Mobis, Aisin, Forvia, Continental and Lear, which is the highest ranked American company. It made just under $21 billion last year.

TOYOTA’S NEXT-GEN C-HR
Toyota revealed the all-new, next-gen version of the C-HR. Styling of the small crossover is still fairly radical, especially the rear end treatment, but the front end design is much more similar to other new Toyota models, like the bZ4x and Prius. It’s also available with a two-tone paint job that accentuates the rear end as well as Toyota’s first flush-mounted door handles. Interior highlights include available dual 12.3 inch digital displays and we like how the dashboard wraps across the door panels, which draws your eye to the round air vents just below the A-pillars. The new C-HR is only offered as a hybrid. There’s a 1.8L and 2.0L hybrid available and a 2.0L plug-in hybrid option. Toyota didn’t provide much info about the setups, but it says the hybrid 2.0L will be offered with AWD and the 2.0L PHEV will automatically switch to EV-only mode when it enters a low-emission zone. Toyota says the new C-HR was designed and developed for Europe and will be exclusively built in Europe, so right now we don’t if other markets, like the U.S., will get the second-gen version.

CHIP SHORTAGE EASING, BUT STILL HURTS
The chip shortage is easing up, but it’s still hurting production. Autoforecast Solutions says automakers have lost 312,000 units of production this year and the total impacted volume for 2023 could hit 2.4 million vehicles. And since January of 2021 automakers have lost over 8.8 million vehicles in production globally due to the chip shortage. The biggest shortfall is in North America, which has lost almost as much vehicle production as Europe and China put together.

STELLANTIS TO LAUNCH EV CHARGING NETWORK
Stellantis is creating an EV charging ecosystem that will include home, commercial and public charging units. It will be operated as a separate business unit under the Free2Move brand and this new business will launch in the US and EU by the end of the year. Stellantis wants to aggregate a large number of public charging outlets with its partners, so a user can use any of them seamlessly with an app. But Stellantis also makes it sound like it will build its own public charging outlets, like the Jeep units located at some off road trails.

NO $40,000 SILVERADO EV
Chevrolet revealed it’s not going to offer a $40,000 version of the Silverado EV Work Truck or WT, which was its original estimated base price. But Chevy joins Ford, who started selling the F-150 Lightning Pro at roughly $41,500, but it now sits at nearly $62,000, and Elon Musk recently indicated the base $40,000 Cybertruck won’t happen either. Tom Moloughney, a recent AAH guest, reports on InSideEVs that Chevy says it will eventually come out with competitively priced versions that start at $50,000, which means with incentives it could push the price back into the $40,000 range. However the first versions of the Silverado EV WT to launch will be priced much higher. Already in production is a version with a bigger battery pack that offers up to 450 miles of range, which starts at roughly $80-grand, and another version will follow not long after with a smaller battery that knocks $5,000 off the price. Right now it looks like commercial versions of the Lightning and Silverado EV are priced pretty well against each other. The Chevy has a big range advantage, but the Ford has it easily bested in payload. Rivian doesn’t offer a commercial version of the R1T, but if you wanted to compare, it starts at $73,000, certain versions offer more towing capacity than both, about the same payload as Chevy, but Chevy beats it in range.

EX-AUDI CEO SENTENCED IN DIESELGATE
Former Audi CEO Rupert Stadler was just sentenced and fined for his role in the Volkswagen Group’s diesel cheating scandal. A German court handed him a suspended sentence of one year and nine months and fined him $1.2 million. He’s the first former VW Group board member to be sentenced for the scheme. Stadler originally denied the allegations but later confessed in order to avoid going to jail.

FORD SUPER DUTY CLAIMS BIGGEST PAYLOADS
When it comes to selling heavy duty pickups, bigger is better. And if you’ve got the biggest numbers you brag all about it. Ford wanted to make sure the media didn’t miss the fact that its Super Duty trucks have the highest payload and towing capacity, so they put giant numbers on display when it showed off the new trucks to the media. It loaded up 8,000 pounds of concrete in the back of an F-350, and hitched a 40,000 pound trailer to the back of an F-450. Journalists could then drive the trucks up and down steep hills at Ford’s proving grounds to experience it for themselves. And while the trucks handled the loads, you’re really aware that you’re hauling a heavy load.

       

VW SAYS NO NEW BEETLE, EVER
Volkswagen teased a concept version of an all-electric Beetle that will be featured in an upcoming kids movie, which had us wondering if it had something in the works. But VW Brand CEO Thomas Schafer says the Beetle won’t be making a comeback because Volkswagen doesn’t think it makes sense to bring it back and Schafer also threw cold water on the Scirocco saying it had its day in the sun.

BMW M BRINGS BACK WAGON
Performance station wagon fans will be happy to hear that BMW is bringing back a touring version of the 7th generation M5. It hasn’t had one since the 4th-gen launched in 2007. The new M5 Touring will feature a new powertrain that it says is partially electrified, but it didn’t give any technical stats. Both the sedan and station wagon versions are undergoing tests right now and should be out next year.

A programming note here. Autoline will shut down next week for our summer break, so there won’t be any Autoline Dailies or After Hours next week. But we’ll resume our normal schedule on the 10th of July.