Discover more from Automotive Supply Chain Risk Digest
Elm Analytics - Automotive Supply Chain Risk Digest #177 - June 26 - July 2, 2020
Germany's e.GO Mobile has begun insolvency proceedings. In turn, it has halted production and development.
CHANGE IN MANAGEMENT
PSA Group has named GM veteran Christian Mueller as its new head of powertrain and chassis engineering. Mueller currently heads Opel/Vauxhall R&D.
New car sales for FCA and GM dropped by 39% and 34% for Q2 this year. A potential bright spot noted by FCA and GM analysts is that retail sales started to rebound in May and June.
The UAW is asking GM to close it's large SUV assembly plant in Arlington, Texas, due to the ongoing rapid rise of COVID-19 cases in the state. UAW Local 276 says the automaker should shutdown "...until the curve is flattened for the benefit and well-being of our members".
Austria is increasing financial incentives for consumers that buy EVs and bikes starting this week. As part of a joint effort with the car industry, EV buyers will now get $5,640, up from $3,371.
BMW announced this week that its EVs would use battery cells produced using renewable energy. The automaker said the use of green power would save around 10M tons of CO2 over the next decade.
After workers at two of its US plants stopped assembly lines last week over coronavirus concerns, FCA issued a letter stating that employees who instigated unapproved shutdowns "will result in zero pay." The automaker declined to comment further on the message.
German prosecutors searched Continental's offices this week over its role as an engine components supplier in the VW diesel emissions scandal. Prosecutor Oliver Eisenhauer told Reuters, "We are investigating employees of Continental for abetting fraud and for providing false documentation."
Ford, Volkswagen, Honda, and BMW have decided to stay neutral on any legal challenges to the Trump administration's decision to roll back the Obama-era fuel economy standards. Despite this, they plan to ask a US Appeals Court in Washington next week for permission to be heard in the court challenge "to ensure that any remedy imposed by this court is both appropriate and achievable."
The largest in its history, Volvo recalled 2.18M vehicles worldwide to repair a steel cable that can wear down and reduce the front seat belts' restraining capability. There are more than 400K affected vehicles in Sweden, over 300K in the US, and 178K in Germany.
MERGERS, VENTURES, ACQUISITIONS
Amazon is buying self-driving startup Zoox for over $1.2B. Amazon says that Zoox will help realize its vision for creating a passenger transport, or robotaxi, service.
Chinese EV startup Byton is suspending production and most of its operations from July to conduct a reorganization of the company in the wake of coronavirus. The automaker is aiming to "...lower employee costs and promote the company's strategic reorganization."
In the UK, car production took a 95% nosedive in May as the coronavirus outbreak kept some plants shuttered and others operating at reduced levels. Output for the first five months of the year is down more than 40%.
Toyota is ramping up production in Japan to support demand in the US.
Automakers largely had higher sales in 2Q than analysts predicted. Consumer demand jumped despite uncertainty.
The U.S.-Mexico-Canada Agreement began July 1.
Just hours before the USMCA went into effect, a senior US customs official said that automotive manufacturers would have until the end of the year to certify compliance.
Japan and Britain are hoping to reach a new trade deal by the end of July. Tokyo's chief negotiator Hiroshi Matsuura said: "We want at least the same level of tariff condition on autos with Britain as we have under the trade pact with the EU."
California regulators have approved new rules that would require at least 40% of tractor-trailers sold in California to be zero-emissions by 2024. Over 55% of medium-duty trucks will be zero-emissions by 2035, and 75% of delivery trucks and vans to be zero-emissions by 2035.