AD #4292 – Automakers Won’t Make Profit at Current Sales Rate; Lexus Gets 1st 3-Row EV; GM Works to Fill Skilled Trades Shortage

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

AUTOMAKERS WON’T MAKE PROFIT AT CURRENT SALES RATE
A little over a year ago car buyers in the U.S. rushed to the showrooms to get a new car before President Trump’s tariffs kicked in. And now we’re seeing the hangover from those sales being pulled forward. The Bureau of Labor Statistics says the SAAR, or seasonally adjusted annual rate, came in at only 15.5 million units for the year. That’s considerably weaker than analysts expected. And a general rule of thumb is that most automakers can be profitable at a 16 million unit SAAR. While the market is fairly resilient, it doesn’t look like sales are going to improve anytime soon. Car buyers are wary of high car prices, high gasoline prices and high interest rates. The University of Michigan’s survey of consumer sentiment dropped 6.6% last month, and that survey is usually a pretty good indicator of future car sales.

           

KIA SLASHES PRICING OF THE EV6
Kia does a decent job of selling EVs, but it’s trying to fix sales of the EV6. Sales in the U.S. bounced up a bit in February and March, but dipped down in April, and year to date they’re off more than 37%. So Kia is slashing the price. The base car gets a $3,400 price cut while the GT price drops by more than $5,800. It hopes that will bring some more people into the showroom, but remember, the people who already bought the car are going to see their residual values drop by at least the equivalent of these price cuts.

GEELY BUYING PART OF FORD’S SPAIN PLANT
Sure looks like Chinese automaker Geely is buying part of a Ford plant in Spain. According to a report from a Spanish trade publication, the two automakers are also discussing having Geely build a model for Ford. Geely did not immediately respond to requests ⁠for comment and a ​Ford representative called the news speculation. However, since neither company denied the report, we think it’s likely true. Building vehicles in Spain will allow Geely to avoid EU tariffs on China-made EVs and allow Ford to fill up some unused capacity. Even though European automakers are very worried about losing more market share, by saving plants and jobs, Chinese companies are a lot less likely to face pushback from governments and unions.

GM WORKS TO FILL SKILLED TRADES SHORTAGE
Even though UAW skilled trades workers are among the highest paid factory workers in the world, those positions are hard to fill. That’s why General Motors is making a big commitment to train future skilled trades workers, investing nearly $200 million in the past year. Last month, it placed 90 skilled trades apprentices across its U.S. manufacturing network. They’ll begin a four-year program, where they’ll receive hands‑on instruction, classroom training and on‑the‑job experience. At the same time, with vehicles becoming more advanced, GM is also investing to train technicians. It has several programs that blend classroom instruction with real-world training to build up skills in diagnostics, electronics and EV systems.

VW SETS RECORD FOR FASTEST FRONT-DRIVE CAR
Car companies keep duking it out to see who can turn in the fastest lap at the Nurburgring Nordschleife. Ford and Chevrolet, for example, keep bringing tricked out Mustangs and Corvettes to the famous German race track, trying to outdo each other. But Volkswagen just impressed us by turning the fastest time for a front wheel drive car with the Golf GTI. And it was a production version of the GTI. Well, mostly. It’s a 50th anniversary edition of the GTI that has 310 horsepower, is 20 millimeters lower, has a lightweight exhaust system, comes with 19 inch wheels, and ran on Bridgestone Potenza Race semi-slick tires. That combination produced a lap time of 7 minutes, 44 seconds and 5 tenths, which puts it right in the ballpark with the Bugatti EB 110 SS, the Pagani Zonda S, and the Mercedes SLS AMG.

TURKISH STARTUP PARTNERS WITH CATL ON EV PLATFORM
EV startup Togg, which is Turkey’s first domestic EV brand, is partnering with CATL to develop EVs on the Chinese battery maker’s skateboard chassis. Under the agreement, Togg and CAIT, a subsidiary of CATL, will co-develop three models based on Togg’s new B-segment platform, which will all utilize CATL’s Bedrock skateboard chassis. The chassis is integrated with the battery and electric drivetrain as well as the suspension and braking systems. It has up to 1,000-kilometers or 621 miles of range based on the Chinese test cycle. And it’s capable of adding 300-kilometers or 186 miles of range in just five minutes of charging. The first model will go into mass production next year.

LEXUS GETS 1ST 3-ROW EV
Lexus revealed its first all-electric 3-row SUV, the TZ. While this is basically the brand’s version of the new Toyota Highlander, it does offer a number of upgrades. It’s only available in AWD, instead of both front- and all-wheel drive, and it makes significantly more power, about 400 horsepower vs. nearly 340 horsepower for the Highlander. But that does impact range with the larger roughly 96 kWh battery pack providing an estimated 300 miles of range, 20 miles less than the Highlander. There’s also a 77 kWh pack, but no range estimates were provided. Other upgrades for the TZ include 4-wheel steering, better materials and, in our opinion, more expressive interior styling. No pricing was provided either, but Lexus expects the model to go on sale before the end of the year.

BMW IX3 STARTS AT $63K
Speaking of all-electric SUVs, BMW revealed U.S. pricing and range figures for the all-new iX3. It will start at nearly $63,000, including destination charges. Models come standard with an over 460 horsepower AWD system, a 112 kWh battery pack and 20-inch wheels, which provides up to 434 miles of EPA range. Of course there’s other comfort, sport, technology and wheel and tire packages that can add thousands more to the price, but the one we wanted is BMW’s new hands-free driving system, which looks like it’s a one-time fee of $2,500. The new iX3 goes on sale in the U.S. in September.

MERCEDES REVEALS PRICING FOR NEW C-CLASS EV
And in one last bit of EV pricing news, the new C-Class is now on sale in Germany with a starting price of just under 68,000 euros or about $80,000, including taxes. That’s for an AWD model with about 480 horsepower and a WLTP rated 762 kilometers or roughly 470 miles of range. But the company says more versions will follow, including rear-drive setups with about 800 kilometers or nearly 500 miles of range.

What’s it going to take for legacy automakers to be able to compete with China Speed? That’ll be on the list of topics for today’s Autoline After Hours. We’ll have Elizabeth Krear, the CEO of the Center for Automotive Research, on the show. She’s the former chief engineer on the Jeep Wrangler and Gladiator, and was the vice president covering electric vehicles at JD Power. So she brings a wealth of knowledge with her. Our colleague Greg Migliore will also be on the show, so join John and Gary when it all goes live at 3 pm eastern time.

But that’s a wrap for today’s show. Thanks for making Autoline a part of your day.