Good morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know on this spoooooooky day.
1st Gear: Toyota’s Boring Takeover Of The U.S.
We keep trying—we really do! We’re begging you. Buy more interesting cars! But no, beige sells and you, Americans, are beiger than Sandstone Firemist paint blasted onto an antelope’s bottom, and Toyota is profiting big-time off of your insufferable dullness, especially with its new RAV4. Bloomberg writes:
Toyota took 15 percent market share last quarter for the first time since 2009. Its RAV4 car-based sport utility vehicle is the industry’s most popular vehicle this year aside from the top pickups, outselling even its own Camry midsize sedan. It beat Ford Motor Co. each month of the third quarter, and analysts project it’s likely got a fourth month in the bag.
Crossovers are the new Camry. Beige just got even more dull—like silver. You know how many silver RAV4s I see out and about? Too many. You jabronis should’ve all bought manual Yarises and 86s in real colors. It’s not like Toyota doesn’t make interesting cars now! You’re all just boring.
Retail sales—specifically, those to actual humans instead of often-discounted sales fleets like those of businesses and rental companies—are what’s driving Toyota’s big boom, Bloomberg reports. Toyota’s total sales (including fleets) are 360,000 behind General Motors, putting it second highest in the U.S.—but they’re only 70,000 behind GM in retail sales. That means you peanut-hued sacks of novocaine are willingly driving beige-boxes.
Toyota is projected to post its biggest monthly sales gain for October after deliveries rose 4 percent, Bloomberg notes. Only Volkswagen and Audi are expected to make bigger gains than that as they continue to dig themselves out of Dieselgate’s mess.
The RAV4 isn’t the only vehicle that’s driving Toyota’s big sales push, according to Bloomberg. Toyota’s more upscale brand Lexus, a maker of slightly nicer beige paint and infuriating infotainment systems, is on track to be the U.S.’s second most popular luxury marque. And of course, there’s a new, redesigned Camry getting rolled out.
2nd Gear: Commuting Really Is That Dull
Who can really blame anyone for buying boring cars when our daily drives are enough to put us to sleep, though? All you’re going to do is sit in dumb traffic on the same dull roads you drive every day.
That’s exactly what pressed the Google-born autonomous car division at Waymo to ditch certain features that required human intervention in dangerous situations, Reuters reports:
Alphabet Inc’s (GOOGL.O) self-driving car unit stopped developing features that required drivers to take control in dangerous situations, its chief executive said Monday, as autopilot reliance left users prone to distractions and ill-prepared to maneuver.
The decision followed experiments of the technology in Silicon Valley that showed test users napping, putting on makeup and fiddling with their phones as the vehicles traveled up to 56 mph.
Yep. Someone actually fell asleep at the wheel.
Waymo had planned to follow other automakers’ leads by requiring drivers to take control in certain hairy situations, but found that users lacked awareness of what was happening around them when the car pinged them to take over in a series of filmed 2013 tests using Google employees. (Especially the napping guy.)
It makes sense, though. Ever have to pay attention to something you’ve not been paying attention to for a while? It’s disorienting, and it sucks!
As such, Waymo’s test Chrysler Pacificas running around Phoenix, Arizona, have only two “drive” buttons for users: one to start a drive, and one to request the car to pull over at its earliest convenience.
3rd Gear: Ramping Up Battery Production For All Those Model 3s
Get ready for the Tesla Model 3 (we hope). Panasonic in finally completing the automation of its production line at its $5 billion gigafactory it runs with Tesla, and that should allow them to eliminate some of the production “bottlenecks” Tesla blamed for Model 3 delays, reports Reuters:
Tesla earlier this month blamed manufacturing bottlenecks for limiting quarterly production of its mass-market Model 3 sedan to 260 vehicles rather than its 1,500 goal.
Panasonic Chief Executive Kazuhiro Tsuga said at an earnings briefing that delays to the automation of the battery pack production line meant some stages had to be completed manually.
“This process (for battery packs) will be soon automated, and then the number of vehicles to be produced will rise sharply,” Tsuga said. He declined to comment to what extent Model 3 production would be behind its targeted schedule.
Panasonic is the world’s largest manufacturer of lithium-ion batteries, and automotive batteries like the ones they’re producing at Tesla’s Gigafactory are a key part of its growth. The company’s next plan, however, is to expand into more facilities that aren’t tied to Tesla’s production schedule, Reuters notes:
Panasonic sees batteries as central to its plan to nearly double automotive business revenue to 2.5 trillion yen by the year through March 2022. To that end, it has been aggressively expanding battery production capacity globally.
It plans to start production this financial year ending March at a new plant in Dalian, China, and is adding production lines in Japan - steps that could allow it to reduce dependence on Tesla.
You know—just in case. Big batteries are big business.
4th Gear: Wall Street Doesn’t Have Much Faith In General Motors Right Now
General Motors stock fell 2.8 percent Tuesday after analysts questioned whether slumping U.S. vehicle sales can sustain GM’s future-tech plans before the latter is ready to hit the market, Bloomberg reports. Analysts claimed that the North American auto cycle is at its peak after seven years of growth, and GM’s autonomous taxis and other fun plans are too far off in the future:
The words of warning came from Goldman Sachs analyst David Tamberrino, who cited a peaking North American auto cycle in general and GM’s pickup truck changeover cycle in particular as he downgraded GM to sell from neutral. Consumer Edge Research analyst Jamie Albertine, who didn’t downgrade the stock, signaled that GM’s “strength of narrative” isn’t strong enough to support its premium while U.S. vehicle sales are slipping after a record seven years of growth.
While GM experienced 28 percent growth over the year through Friday and many laud the automaker’s forward-thinking plans, it was the pessimists who drove the drop in GM stock, as Bloomberg explains:
Bullish investors are betting that GM’s test fleet of self-driving electric cars can be converted into a lucrative robotaxi operation worth billions. A dimmer view says that advanced mobility businesses are a long way off and that profits from GM’s core business will suffer as vehicle sales slow in its home market.
GM spokesman Tom Henderson naturally disagreed with this dismal view in an email to Bloomberg:
We’ve repositioned our core business to be more resilient, and have made key investments to lead the future of personal mobility that will help us develop a healthy business model well into the future.
However, Goldman Sachs analyst David Tamberrino noted that competition from a new Ford F-Series truck, combined with GM’s current incentive spending and higher inventory numbers also influenced his rating.
5th Gear: To Beat The Germans, You Must Hire Them
Hyundai’s Genesis luxury brand has yet another hire away from BMW, Automotive News reports. New Vice President of Genesis Architecture Development Fayez Abdul Rahman’s job will focus on improving the quality and performance of the Genesis line, as well as set key specifications for the cars.
Rahman’s arrival—which comes shortly after Hyundai’s hiring of Albert Biermann away from BMW’s M division—is part of a big upcoming development push at Genesis:
Rahman, 58, is a German national who previously led concept and platform architecture development for several model lines at BMW, including the 7 series, X models and high-performance M brand vehicles.
The appointment comes as Genesis plans expand its three-sedan lineup to six nameplates by around 2020, next through the addition of crossovers.
I’m pretty sure “to beat your nemesis, you must become your nemesis” is a cheesy line in basically every kung fu movie ever. Rahman’s work will trickle down to other brands in Hyundai’s stable in a big push to beat—you guessed it—the European auto manufacturers.
Reverse: Toyota Goes Hollywood!
Neutral: Waymo Take The Wheel
Are you fine handling near-total control over to a self-driving car yet? Why or why not?