Follow us on social media:
Runtime: 10:00
0:00 Nissan Improves, But Still Struggling
1:04 VW Cancels Gigacasting Project
1:56 China Yuan Undervalued, But Strengthening
2:56 Ford Hires Ex-GM Execs
4:14 Finland Approves FSD, But Is That Enough?
5:03 Horse Ready to Sell V8s
5:56 Scion By Toyota, What’s That About?
Visit our sponsors to thank them for their support of Autoline Daily: AlixPartners; Bridgestone; CSP and Intrepid Control Systems.
This is Autoline Daily, the show dedicated to enthusiasts of the global automotive industry.
NISSAN IMPROVES, BUT STILL STRUGGLING
When Nissan named Ivan Espinosa as its new CEO back in April, he came in swinging an axe. He announced Nissan would cut 12 model lines, close 7 plants, lay people off, spend less on R&D and Capex and cut $3 billion from its operating expenses. Nissan posted its latest financial earnings this morning and they show the company is making progress, but still struggling. Nissan sold 709,000 vehicles worldwide over the last three months, down more than 8%. Even so, revenue grew 9.5% to $19.5 billion. And while it lost about $273 million, that’s nearly a $400 million improvement.
VW CANCELS GIGACASTING PROJECT
Volkswagen had a plan to slash manufacturing costs and compete with Chinese automakers by copying a lot of Tesla’s ideas at its main plant in Wolfsburg, Germany. VW called it the Gamechanger concept. It was going to use gigacastings, unboxed assembly, a new platform called SSP for Scalable Systems platform, and even dry coating of battery cells. But that would have involved a massive investment. And right now, VW is being squeezed for cash. So this morning it announced it’s scrapping the Gamechanger program. And that shows just how much trouble the company is in. When you scrap a plan to make yourself more competitive because you can’t afford it, you’re in really deep trouble.
CHINA YUAN UNDERVALUED, BUT STRENGTHENING
Here’s a development we’re really going to have to keep our eyes on. China’s trade surplus is running at an all-time record. It’s at $1 trillion for the first 10 months of the year. Economists say a surplus like that should be strengthening the yuan. The IMF, or International Monetary Fund, says the yuan is undervalued by anywhere from 17% to 25%. And that sure helps to explain why Chinese exports are so cheap. China controls its on-shore currency so it can deliberately keep it weak. Even so, its off-shore yuan, which is openly traded, is appreciating a bit. It’s up 4.6% against the dollar this year. And even that little bit of strengthening is hurting Chinese exporters. Geely lost money on its foreign exchange and analysts expect other automakers to report the same thing.
FORD HIRES EX-GM EXECS
We’ve seen Detroit’s automakers hire a lot of Silicon Valley and tech types recently. But Ford’s latest headhunting safari has seen it poach a couple of executives across town from General Motors. Marissa West, who sort of mysteriously stepped down as President of GM North America two years ago, and went to work at a French supplier called OPmobility as executive VP for North America, suddenly popped up at Ford as Vice President of vehicle programs. And Mike Albano, who worked 28 years at GM and was the director of director of communications is now at Ford as director of product and brand communications. Back in the day, if you were hired at GM or Ford, you were expected to be there for life. But these days employees don’t show that much loyalty to their company, because all too often their company is not loyal to them.
FINLAND APPROVES FSD, BUT IS THAT ENOUGH?
Another country in the European Union approved Tesla’s FSD system. Finland has granted provisional support for the technology, although its transport authority says its approval does not commit the country to supporting it in a wider EU vote that’s scheduled to take place in December. 11 countries have now approved the system in the EU but none of the region’s largest members have given it the OK. At the upcoming EU wide vote, Tesla needs at least 15 of the 27 EU member states, representing 65% of the total EU population to approve the system. But if the vote falls short of that threshold, it would invalidate the approvals already given.
HORSE READY TO SELL V8s
Horse Powertrain, the joint-venture between Renault and Geely, is revealing its first ever production-ready V8 engine. The four-liter unit produces 500-kW of output or 670-horsepower and 800 Nm or 590 lb-ft of torque. The engine was designed for hybrid vehicles and Horse also developed a special 8-speed dual-clutch transmission to pair with the new V8. The engine and transmission will make their world debut in the upcoming Lotus Type 135, the brand’s first-ever supercar. Besides sportscars, Horse says the engine is also ideal for pick-up trucks and off-road vehicles. Hint, hint. That means Horse is ready to sell this engine to anyone who wants to buy it.
SCION BY TOYOTA, WHAT’S THAT ABOUT?
While the numbers are small, Fiat has had some unexpected success with its Topolino microcar in the U.S. It shipped 300 Topolinos to dealers and they were quickly snapped up. And now another automaker is joining the small car segment in the U.S. Yesterday, Toyota unveiled a new brand called Scion by Toyota along with its first model, an ultra-compact truck called the KEI-01. It’s powered by a 660cc three-cylinder engine that’s mated to a CVT and it features four-wheel drive. The right-hand drive model has a payload capacity of 600 pounds in the bed but its speed is limited to just 25 MPH. The KEI-01 will be assembled at Toyota’s plant in Indiana starting in the second half of next year. It will initially be targeted at fleet customers and sold through select dealers in Toyota’s existing network. Two concepts were also revealed, an all-terrain vehicle called the SxS Concept and a two-wheeler called the BKE Concept. Toyota says these are meant to demonstrate the broad range of vehicles the Scion by Toyota brand will explore. In Japan, the KEI-01 sells for $7,000 to $9,000, but the U.S. version is expected to cost twice that amount.
And with that we wrap up today’s show, thanks for watching Autoline Daily and a special thanks to our Patreon and YouTube members who support this show.
Thanks to our partner for embedding Autoline Daily on its website: WardsAuto.com
John,
Good show. Your comments triggered a couple of questions in my mind.. Any idea why Nissan has not joined the HORSE joint venture? I would have thought that they need it more than Renault does. Also, it sounds like VW’s improvement plans would have made gains by requiring fewer employees. Did VW perhaps cancel the plans when they realized that IG Metal would never agree to the worker reductions? You have talked before about how the Big 3 could have reduced costs by sharing parts that nobody cares about, like 2 litre 4 cylinder engines. but that they needed to keep their V8s separate because people DO care about them. But what about V8 engine parts? Do GM and Ford share parts suppliers for V8 components or castings? I don’t know if there is such a thing as a low-volume engine these days anywhere in the world, but I would have expected that every OEM would be interested in offering at least one V8 model if their was someone like HORSE, Ford or GM that was willing to supply them with a proven unit.
Seems strange that Scion (aka, Toyota) will build the KEI-01 in the US with right hand drive. I’ve read elsewhere that the price will be more like $28k, which seems way out of line!
That is seriously strange that Toyota would built a handful of “golf cart rule” trucklets in the Indiana plant. The market will be theme parks, and maybe universities to run stuff around on-site. A few people in The Villages will buy them. The are probably going to be RHD so they can just bring “kits” of Japanese home market vehicles and assemble them in the Indiana plant. I’m sure some will be illegally de-restricted to go much faster than the 25 mph limit to be road-legal in the U.S.
That Horse V8 sounds pretty specialized, making 670 hp from a four liter engine. If it’s for pickups and off-roaders, they must be thinking of Ram TRX and Jeep Rubicon 392 competitors. Maybe they’ll make milder versions for mainstream trucks. It will be interesting to see who buys them. I doubt if they will end up in F-150s.
Kevin, there’s a lot of talk within legacy automakers about whether they should buy engines from Horse or split the cost of their engines with other automakers. So far, the powertain divisions in those car companies have found every reason in the book why this doesn’t make sense. But the cost savings are just too big to ignore, so at some point the dam is going to break. I think the first crack will be with range extenders for EVS. And if I’m reading the tea leaves right, I think Ford will go with a Horse range extender in the next gen Lightning.
Many people think that company loyalty was basically dissolved after the 2008 Great Recession. As Gov bailouts forced the removal of the job bank for factory workers. But even in the early 90s when companies saw a drop in profit the quick fix to save face at a shareholders meeting was to just cut heads. Quick fix to make the numbers look better. No one cared that these were real people and had major effects to families and communities. So that became the norm of operation. Even if the company made money but maybe didn’t hit the forecast that was targeted it would result in layoffs. So as workers and you see that a company will lay you off or just plain let you go at the drop off a hat. It’s kinds hard to have much loyalty to that company. Certainly those execs had signed a non compete clauses so maybe that’s the reason for the gap before Ford brought them on. Either way can’t be surprised that any workers will jump ship and even go to a competitor when you treat them as such. Respect and loyalty goes both ways.
John McElroy, I hadn’t thought of that, but range extenders would be the ultimate case of engine “character” being a non-issue. You just have a steady, and in some cases, an intermittent drone of the engine doing its thing.
That horse power train looks nice. Will be interesting to see which vehicles end up using it.