Geely has ambitions, Hyundai is getting more serious about EVs, Buick wants the Encore GX to perform, and a lawyer accused GM of McCarthyism. All that and more in The Morning Shift for August 10, 2020.
Geely bought Volvo a decade ago in a time when that deal was seen as ... sketchy at best, since Volvo wasn’t really on solid footing and Geely was an unknown. All Volvo has done since then is hit it out of the park, while Geely has been rising along with it. Geely is now sketching out plans to join the adults in the room.
Part of Geely’s ambition lies with its vehicle architecture developed with Volvo, as Reuters explains:
Chinese carmaker Geely plans to use a platform developed with input from Volvo to build new models in Malaysia for its partly owned Proton brand, a strategy that shows how it aims to accelerate its push to become China’s first global auto giant.
Senior Geely officials and engineers told Reuters that a project dubbed Compact Modular Architecture (CMA) will allow them to develop, design and build different types of compact cars with similar mechanical layout faster than before - and at lower cost.
They said CMA, along with a platform for smaller cars known as B-segment Modular Architecture (BMA) that Geely plans to roll out for Proton, allow them to harness the Swedish automaker’s technologies and Geely’s capabilities in cost control, supply chain management and local production.
This is one part of a broader plan to join the global elite.
In its pursuit of global automaker status, Hangzhou-based Geely is now holding talks to merge the Volvo Cars business with its Hong Kong-listed Geely Automobile (0175.HK) - worth about $22 billion by market value, bigger then famed industry names like Fiat Chrysler Automobile (FCHA.MI) and Nissan Motor (7201.T).
As well as the 49.9% stake it took in Proton three years ago, the broader Geely group - Zhejiang Geely Holding Group [GEELY.UL], led by Taizhou-born billionaire Li Shufu - now also comprises a 9.7% stake in Germany’s Daimler AG (DAIGn.DE) and a majority stake in British sport car brand Lotus.
And while giants from Toyota Motor Corp (7203.T) to Volkswagen AG (VOWG_p.DE) and General Motors Co (GM.N) have followed a similar shared platform projects for their respective brands, Geely’s strategy is a first for a Chinese company.
You already know Ioniq as the name of Hyundai’s electric and hybrid hatchbacks, but the company said yesterday that it was planning to make Ioniq an entire brand of electric vehicles. Between this and the Cadillac Lyriq I have no idea why companies think -iq is a great name for an electric car but that’s above my pay grade.
Hyundai says it wants to sell at least a million EVs by 2025.
From Automotive News:
The Ioniq 5 coming next year is based on the concept 45 vehicle from the 2019 Frankfurt auto show, the automaker said in a statement. The Ioniq 6 — to be launched in 2022 — is a sedan that takes its inspiration from the Prophecy concept shown in March. It will be followed in early 2024 by a large SUV, the Ioniq 7.
The naming of the vehicles is based partially on body style. Crossovers and SUVs will use odd numbers and sedans will use even numbers, Hyundai said in a press release. The current Ioniq vehicles will be known simply as Hybrid, Plug-In Hybrid and Electric.
The new Ioniq brand will be sold through the existing Hyundai dealership network.
Hyundai said that additional Ioniq models will follow after the first three are launched by 2024.
Also buried in this news is that Genesis will have an EV by 2022, which I think I’m more curious about than anything called Ioniq.
It has gotten rid of a lot of Encore trims in an effort to goose sales, but what it really wants is for the new Encore GX to take over. The Encore GX, which shares its platform with the Chevy Trailblazer, is bigger than the subcompact Encore. GM thinks it will be a big hit.
That’s thanks to what sounds like some sort of product planning jiu-jitsu, which surely will make sense to someone with an MBA or something but to me sounds like someone trying to impress their boss.
From Automotive News:
“We’re really focused on that space right between the premium small-SUV space and the lower end of the compact-SUV space,” said Rob Peterson, Buick marketing manager.
The GX — which is bigger than a Subaru Crosstrek or Mazda CX-3 but smaller than a Jeep Compass or Ford Escape — fits into a white space where General Motors believes the industry could add 1.5 million incremental sales, Peterson said.
“We think that we’ve got the right product to kind of squeeze in there and grab the necessary volume for Buick to be successful,” he said.
The Encore GX starts at $25,095 including shipping, or about $900 more than the Encore, which has been Buick’s top seller in each of the past five years. The GX offers three trims.
Buick just keeps persisting. I expect it to outlive me at this point.
Hyundai’s position here I somewhat understand, given that it makes reasonably-priced and well-made cars. Mazda I understand a bit less since it makes slightly more expensive well-made cars.
From Automotive News:
Both Mazda and Hyundai crashed into the red in March along with the rest of the industry. But since then, they have been two of the industry’s better performers. Hyundai was down 18 percent in the January-June period, and Mazda fell 7 percent compared with the first half of 2019. The light-vehicle industry as a whole was off 23 percent in the first half of this year.
This is, of course, because of SUVs.
“Our SUV sales continue to do all of the heavy lifting for us,” said Randy Parker, vice president of national sales for Hyundai Motor America. “SUV [retail] sales were up 16 percent in July, fueled by Palisade, Santa Fe and Kona. Tucson also did extremely well for us.”
The new Palisade three-row crossover, which debuted a year ago, nearly doubled its sales in July to 8,404. The subcompact Venue, a new model for 2020, added 1,620 sales and beat the Accent sedan it eventually will replace. Another crossover, the subcompact Kona, was new for the 2018 model year and sold 7,077 vehicles in July for an 11 percent gain over last year.
The new CX-30 crossover that went on sale in November was good for 20,743 sales in the first seven months of this year. That helped compensate for plummeting deliveries of the Mazda3 and Mazda6 passenger cars and the aging CX-3 subcompact crossover.
For the broader January-July period, Mazda’s sales are down just 5.5 percent to 152,954.
“Our marketing plans were interrupted by COVID-19, yet CX-30 is still seeing success,” Jeff Guyton, president of Mazda North American Operations told Automotive News. “In fact, July was our best month ever,” he said of the CX-30's results.
GM is still trying to push its lawsuit against FCA, which alleges corrupt union bargaining that hurt GM’s business and, more recently, offshore accounts. A lawyer for a former vice president at FCA, Alphons Iacobelli, who was named in the suit, said in a court filing Saturday that the most recent allegations against his client were “scurrilous.”
Iacobelli is one of 14 people convicted in the ongoing federal corruption probe. He’s currently serving a five-and-a-half-year sentence at a prison in West Virginia.
From The Detroit News:
In a federal court filing, defense lawyer Michael Nedelman faulted General Motors Co.’s legal team for leveling the unproven allegations. He likened their conduct to the late Sen. Joseph McCarthy claiming to have a list of government employees who belonged to the Communist party in the 1950s.
“GM has...taken a page from Sen. Joseph McCarthy’s infamous February 9, 1950 claim of having compiled ‘evidence’ of State Department employees who were allegedly members of the communist party,” Nedelman wrote. “Senator McCarthy never actually made the list public but garnered significant attention by promoting his claim that ‘I have here in my hand a list... of those supposed State Department employees.
A GM spokesman could not be reached immediately for comment Saturday. FCA officials have called GM’s lawsuit “meritless.”
McCarthyism! Sort of can’t believe that’s still a frame of reference.
I got nothing new to report. The thing about this pandemic aside from the massive avoidable tragedy of it all is that it’s also completely sapped everyday conversation. There’s never anything to talk about!