The United Auto Workers strike at General Motors goes on, the falling prices of used cars, Toyota’s bet on hydrogen, safety tech doing the opposite of what it’s meant to, and Renault’s new interim chief executive. All of this and more in The Morning Shift for Friday, Oct. 11, 2019.
1st Gear: The GM Strike Continues, As Do Tensions
The General Motors United Auto Workers strike is nearing a month, and the longer it goes, the more tense it gets. Bloomberg reports that GM’s chief labor negotiator now believes the UAW is “dragging its feet,” as Bloomberg put it, since the company apparently made an offer on Monday morning and hadn’t gotten a response as of Bloomberg’s Thursday publishing. Part of that delay, it seems, is that the UAW only wants to counter the offer after five committees sort through a “series if issues.”
That, like any disagreement over livelihood, could take awhile.
The reports are that GM is, of course, losing profit over the strike, hence why the company would want to get negotiations moving along. But workers, whose healthcare GM canceled when the strike began but reinstated after backlash, are fighting for things like job security and keeping plant activity in the United States.
Here’s the current situation, via Bloomberg:
“We object to having bargaining placed on hold pending a resolution of these five areas,” Sandefur wrote to UAW Vice President Terry Dittes in a letter obtained by Bloomberg. “As we have urged repeatedly, we should engage in bargaining over all issues around-the-clock to get an agreement.”
The letter marks a turning point for GM in the fourth week of a strike that’s halted production at 34 U.S. plants and disrupted output at factories in Mexico and Canada reliant on American parts. While GM publicly released details of its first formal offer to the union on Sept. 15, the day the UAW announced a walkout, the company has kept a lid on public criticism of union leaders, who themselves are dealing with a credibility crisis linked to a federal corruption investigation.
The general idea of union contract negotiations is coming to an agreement that both sides can live with—management and workers—and doing so can take a while, even when the tensions are high. It’s a battle of what’s most important, since neither side will win everything, and coming to a widespread agreement on that isn’t easy.
2nd Gear: The Ripple Effect Of Dropping Used-Car Prices
Prices of used cars are dropping in part due to an influx of vehicles returning from lease, Bloomberg writes, but that’s not only a cause for celebration. It actually has some negatives to it.
Bloomberg reports that auto analysts think falling used-car prices could be a long-term trend, with those prices affecting new-car sales and the ability for people to buy new cars in the first place. From the story:
Analysts have warned for years that a glut of off-lease vehicles was coming and would pose a risk to carmakers by making used autos look like better bargains than new ones.
“It’s only going to get more competitive for the new side,” Chesbrough said Thursday during a tour a Michigan auto-auction facility run by Manheim, which Cox owns. “If we continue to see used prices decline, it will provide another value option, another buying option for folks who are in the market.” [...]
Still, Jonas cautioned that if the value of consumers’ used cars drop, they may have trouble continuing to secure the financing needed to buy new vehicles in the coming years.
It’s always nice to look at the downsides of price drops on any products, isn’t it? We pride ourselves on optimism around here, you know.
3rd Gear: Toyota’s Bet On Hydrogen
While everyone seems to be leaning toward electrification and autonomy, a few outliers like Toyota have their eyes on hydrogen-powered passenger vehicles. And at Toyota, the future of hydrogen vehicles—which includes a rear-wheel-drive Mirai sedan, right now—looks pretty good.
But Toyota’s ideas for hydrogen, while they don’t go against the grain in terms of greener vehicles, are in another lane from the electrification route that most other carmakers are going. Even then, though, Toyota seems to feel pretty good about the approach. From Bloomberg:
The Japanese behemoth will begin sales late next year of the second-generation Mirai, its fuel cell-powered four-door, and ramp up annual production by 10-fold from the current model. Toyota’s bet that it can position a hydrogen sedan for more of a mass market flies in the face of rivals wagering on putting batteries into the bigger-bodied vehicles consumers are buying.
[...] While the company has pledged to offer an electrified version of every model in the next five years, and 10 fully electric vehicles by early the next decade, it’s also going to keep coaxing consumers to give hydrogen a try.
“Toyota won’t be putting all our eggs in one technology basket,” Doug Murtha, Toyota’s U.S. group vice president for corporate strategy and planning, said at a briefing in Greensboro, North Carolina.
Bloomberg has more on Toyota’s history with hydrogen, past iterations of the Mirai, and how the company’s technology has developed and gone global over the years here.
4th Gear: When Safety Tech Does The Opposite
Safety technology is the big thing right now, since everyone wants backup from the car in case something bad happens. But what happens when the safety tech makes things dangerous? Good question.
Automotive News reports that federal safety officials began a probe into the auto emergency braking system installed on more than 553,000 2017 and 2018 Nissan Rogue models last month—some of which, according to complaints, are braking when there are no obstacles. From the story:
More than 800 motorists have lodged complaints about false positive incidents with Nissan Motor Co. and NHTSA.
Fourteen crashes have been attributed to the braking malfunctions, resulting in five injuries. Those numbers perhaps pale compared with the benefits of automated emergency braking systems: In February, the Insurance Institute for Highway Safety reported that automatic emergency braking “reduces the frequency of property damage liability claims by 13 percent, rates of rear-end crashes by 50 percent and rear-end crashes involving injuries by 56 percent.”
Automotive News mentions that Nissan and 19 other car manufacturers came to a voluntary agreement in 2016 with the U.S. National Highway Traffic Safety Administration to have automated emergency braking as standard by September of 2022, which could mean a whole lot more systems like this one on the road. The website has more on the story here.
The future will be fun, kids.
5th Gear: Renault Names Clotilde Delbos As Interim Chief Executive
Renault is in the middle of a management shakeup, and in the meantime, announced that it’s named Clotilde Delbos as its interim chief executive. She replaces Thierry Bolloré, whose tenure as CEO ended “with immediate effect” after a meeting with the company’s board of directors on Friday.
The management shakeup is coming in the still-near aftermath of the Carlos Ghosn saga, and Automotive News Europe reports that sources told Bloomberg Delbos will be a candidate for the permanent CEO position. But the appointment of Delbos, even if temporary for now, makes her one of few women near the top of a major global automaker.
From Automotive News Europe:
Delbos is considered a steady hand at the embattled automaker, which has suffered a number of setbacks since former chairman and CEO Carlos Ghosn was arrested 11 months ago in Japan on allegations of financial misconduct, plunging the automaker’s relations with Nissan into crisis.
Renault will begin looking for a permanent replacement, according to the statement. One recruiting firm was already identified to carry out a search, said two people with knowledge of the matter. The company didn’t give a timetable for naming a permanent successor.
The story has more on her appointment here.
Reverse: The 100th Flight Of The Space-Shuttle Program
On Oct. 11, 2000, NASA launched the 100th flight of the space-shuttle program with the Discovery and STS-92, via its website. The first mission launched in April of 1981, the site said.
Neutral: How Do You Feel About The New Toyota Mirai?
It looks pretty good, doesn’t it? Yeah, it does.