AD #3616 – We Crawl Around GM’s Brightdrop EV; Lamborghini Catching Up To Ferrari; Toyota Ramps Up China R&D

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

CRAWLING AROUND GM’S BRIGHTDROP EV
I was out with a buddy of mine yesterday running some errands when we drove past a BrightDrop van just sitting in a parking lot. No one was around to talk to but since it’s based on GM’s Ultium platform, like the Hummer and Silverado EV, I was interested in taking a look around the van. One of the first things I looked at was fit and finish. The large body panels look like they’re made of some sort of fiber composite and it’s hard to tell if they’re painted, but the surface was very uniform. Overall I felt like it was pretty good for a commercial vehicle. But not all the exterior panels lined up perfectly, I’m not sure if this is final production quality for how the body is bonded together and there was a large gap at the base of the A-pillar that looked like it could use some weather stripping. I was surprised by how well the interior looks put together. The fit and finish is better than I thought it would be and there’s two digital displays for the driver. Most interesting to me was the fact that this van was AWD, you can clearly see the axle going to the front wheel in the picture, and the rear leaf spring setup. I’ve never seen a leaf spring shaped like this with an almost S-curve at the top. I think it was a composite, not steel, spring, but I foolishly forgot to tap on it to see. Anyway, those were the highlights, hope you enjoyed it as much as I did. And I’d love to drive one of these BrightDrop vans one day.

AUTO SUPPLIERS GET BIG LEGAL WIN
Automotive suppliers just got a big win in the Michigan Supreme Court. The judges ruled that automakers have to clearly stipulate how many components or commodities they’re going to buy from a supplier. The same applies to contracts that suppliers have with their suppliers. Up to now the language in the contracts was not explicit. So if production of a certain model dropped for whatever reason, suppliers could get stuck with excess capacity, and have little leverage to negotiate for an increase in prices. But Automotive News reports that the Michigan Supreme Court ruling is going to give suppliers more leverage in their negotiations. And that could be a real help since the supplier industry is under enormous financial pressure right now.

LAMBORGHINI CATCHING UP TO FERRARI
Slowly but surely, Lamborghini is catching up to Ferrari. It’s on track to sell over 10,000 cars this year. Last year Ferrari sold 13,200 cars. Three years ago, Lambo was selling about 7,400 a year, so it’s closing the gap. But there’s a danger here. When you get into the rarified atmosphere of exotic sports cars it’s critically important to make sure you keep production just below demand. You need to keep a few customers waiting in line so that pricing and residual values stay high. So far neither Lambo or Ferrari have crossed that line. Lamborghini just reported first half earnings, and it’s revenue jumped to €1.4 billion, up a healthy 6.7%. Its operating profit came in at €456 million, which gave it an operating return on sales of a jaw dropping 32.1%

MAZDA TO AXE MX-30 EV
If Mazda didn’t have to comply with zero emission mandates in places like California, there’s no doubt in my mind that it wouldn’t have a single electric vehicle in its lineup. And soon it won’t in the U.S. Mazda announced it will discontinue the MX-30 EV after the 2023 model year. But it was only available in California, Mazda has sold 66 units so far this year and about 600 over its lifetime in the U.S. It pulled the model off the market once before and then brought it back again, but it didn’t put out a press release about taking it away at that time. So, who knows if it will come back? Mazda instead says it’s going to focus on hybrids and plug-in hybrids in the U.S. market.

RENAULT & NISSAN KISS AND MAKE UP
Renault and Nissan are finally patching up their disagreements. Nissan was unhappy that Renault had more power in their alliance, even though Nissan is a bigger company. But that’s changing and now, Nissan will invest $660 million into Renault’s new EV and software division called Ampere. As part of their new agreement, each automaker will own15% of the other. Renault will transfer about 30% of Nissan’s shares worth about $4.2 billion into a French trust. And Nissan will get full voting rights in the alliance for the first time. The two companies will also collaborate to develop vehicles and technologies for Latin America, Europe and India.

NISSAN MAY NEED TO EXPORT CARS FROM CHINA
Meanwhile, Nissan is really struggling in China. Sales plunged nearly 50% last quarter. So to try and maintain some semblance of production, Nissan’s CEO says the company is considering exporting vehicles from China. But they haven’t decided where they’ll export them to. And as we’ve reported, China car exports are soaring because there’s so much overcapacity in the country. In the first half of the year, China exported 2.1 million vehicles, up 75% from a year ago.

TOYOTA RAMPS UP CHINA R&D
Toyota is facing two threats. It’s been slow to get serious about developing electric cars, and it too is losing sales and market share in China. So now it wants to make up for lost time. Not only did Toyota create an all-new business unit called the BEV Factory, it’s ramping up its R&D efforts in China. Part of that includes embedding EV engineers from Denso and Aisin at its R&D lab in China. Reuters reports that engineers from Chinese automakers FAW, Guangzhou and BYD will also be located there. The new R&D effort is being called IEM by Toyota. IEM stands for Intelligent ElectroMobility. It will concentrate on developing electric cars and smart cockpits.

MERCEDES CLA CAN GO BEV OR ICE 
Mercedes teased the all-new CLA that’s going to debut at the Munich auto show in September. It’s the first model that’s going to be based on the Modular Mercedes Architecture, which can support any combination of gas and electric as well as front- or all-wheel drive. Reports say electric versions will feature either lithium-ion or lithium-iron phosphate batteries. The new CLA will be made in China, Germany and Hungary. Sales kick off late next year and into 2025.

But that’s a wrap for today’s show. Thanks for joining us.