Jaguar Land Rover is doing a bit better, as are the Germans, and Nissan is recalling Pathfinders again. All that and more in The Morning Shift for January 29, 2021.
Around this time last year, Jaguar Land Rover was cutting production because demand for its cars simply wasn’t there. That was just before the pandemic hit worldwide, after which things looked a whole lot bleaker, not just for Jaguar Land Rover but for everyone.
Part of the problem back then was sales in China were not so good; now JLR is seeing something like the opposite of that. And also attendant profits.
From the Financial Times:
The Range Rover maker edged into profit for its financial year so far after a strong three months at the end of 2020 boosted by Chinese sales and the faster rollout of its new Land Rover Defender.
JLR, owned by Tata Motors, turned a £439m pre-tax profit between September and December, about £121m higher than the same period a year earlier, and £374m higher than the previous three months, it said on Friday.
The group said it had recorded a pre-tax profit of £91m over the first three quarters of its financial year, which runs from April to March.
Chief executive Thierry Bolloré, who joined in September, said the result “is a credit to the outstanding efforts of the employees of Jaguar Land Rover to overcome many challenges this year”.
This is all not to say that JLR is out of the woods, and it remains sort of wild how quickly automakers are pivoting to electrification, and how important that is for a company like JLR going forward.
Daimler, BMW, and Volkswagen also were cushioned by sales in China. That’s probably a positive sign for elsewhere going forward, as vaccines are distributed and the whole long process of returning to “normal” kicks into gear.
Daimler reported 6.6 billion euros of preliminary earnings before interest and taxes for last year and 8.3 billion euros of industrial free cash flow, both better than consensus. The company will release detailed results and full-year guidance on Feb. 18.
The upbeat figures added to evidence the auto industry is sustaining a recovery from coronavirus disruptions. Daimler, BMW and VW each benefited from robust sales in China in the second half of 2020 and ended a tumultuous year on a positive note.
Daimler raised its profit guidance for the year in October after sales bounced back from the dramatic industry slump triggered by the pandemic. It expected earnings before interest and taxes to match the prior-year level after previously forecasting a drop.
Rating firm Standard & Poor’s raised its outlook for Daimler to stable from negative on Jan. 21, saying that it expects the company to increasingly benefit from “stabilizing demand, cost-efficiency measures, and favorable shifts in its product mix.”
A chip shortage has been disrupting the auto industry and now it has come for the Ford Explorer and Lincoln Aviator.
From Automotive News:
Ford Motor Co. will idle two shifts at its Chicago Assembly Plant next week because of the ongoing microchip shortage.
A company spokeswoman late Thursday confirmed the move. Local UAW officials first warned workers there of the potential layoff on Wednesday.
The temporary reduction in shifts will affect Ford’s production of the profitable Explorer, one of the company’s top sellers, and Lincoln Aviator crossovers. The plant employs about 5,800 workers.
There are some juicy details in this Reuters report from last night about a potential tie-up between Hyundai and Apple, which have been in a complicated dance for a while now over whether to team up on making an Apple-branded car.
“We are agonizing over how to do it, whether it is good to do it or not,” said a Hyundai executive aware of the internal discussions on the tie-up with Apple. “We are not a company which manufactures cars for others. It is not like working with Apple would always produce great results.”
Few details are known about the talks between the two companies. But people close to the discussions say the options considered included Hyundai or Kia acting as a manufacturer for vehicles designed by Apple and sold under its powerful, ubiquitous brand.
It seems, mainly, like Hyundai is wary of being consumed by the Apple machine.
“The Group is concerned that the Hyundai brand would become just Apple’s contract manufacturer, which would not help Hyundai in its effort to build a more premium image with its Genesis brand,” the insider said. Kia is also moving faster in terms of electric cars, and it has available production capacity at its Georgia factory in the United States.
Another executive at Hyundai said: “Tech firms like Google and Apple want us to be like (contract phone maker) Foxconn.
“A cooperation may initially help raise the brand image of Hyundai or Kia. But in the mid- or longer-term, we will just provide shells for the cars, and Apple would do the brains.”
Executives at both companies are likely DMing each other at this very moment to kvetch about who leaked and why. On one hand, I get Hyundai’s concern about the mid- to long-term potential damage for the Hyundai brand; on the other I look at Foxconn and the billions it rakes in and think, well, why wouldn’t Hyundai want in on some of that.
Some of them were already recalled once. The issue at hand is an odd one.
From the Associated Press:
Nissan is recalling more than 354,000 Pathfinder SUVs worldwide, some for a second time, because the brake lights can stay on all the time.
The recall covers certain Pathfinders from the 2013 through 2015 model years. The automaker says a stop lamp relay can get stuck in the on position. The problem can limit engine power and let drivers shift out of park or start the engine without a foot on the brake pedal.
The 2013 and 2014 models were first recalled in 2016. The latest recall has a new repair and adds the 2015 model year.
There is one crash blamed on the defects but no injuries. There is also something comic and highly dangerous about brake lights staying on all the time. Get your recalls done!
During his presidency, McKinley (who died from an assassin’s bullet in September 1901) took a drive in a Stanley Steamer, a steam-engine-powered auto built in the late 1890s by brothers Francis and Freelan Stanley. The Stanley Motor Carriage Company produced a number of steam-powered vehicles before going out of business in the early 1920s, after being unable to compete with the rise of less expensive gas-powered cars.
Another day in the United States of GameStop.