July Wasn't Entirely Terrible Unless You're Nissan

That’s a, uh, that’s, a Nissan... Maxima? Yeah. Maxima. Photo: Nissan
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In a surprise turn, things could be going better for the company that hasn’t debuted an interesting new car in, what is this now, eight or nine years? All this and more in The Morning Shift for Friday, August 2, 2019.

1st Gear: Foreign Brand Sales Up Across Board, Just Not Nissan

As we’ve covered ad nauseam here at The Morning Shift, this has been a rough year for new car sales. After almost a decade of massive growth following the recession, demand for new cars has greatly tapered off as of late in both the U.S. and China—the world’s two biggest car markets. Between that decline, Brexit, an anticipated economic downturn in the U.S., a looming trade war and uncertainty around autonomy and electrification, the future of the auto industry doesn’t feel like an especially rosy one.

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But hey, good news! Sort of. A few brands, particularly the Asian ones, had a pretty decent July in terms of sales. Brands except for Nissan, that is. From Bloomberg:

Honda Motor Co., Hyundai Motor Co., Subaru Corp., Toyota Motor Corp. and Volkswagen all reported July sales gains in the U.S. compared with a year ago. The exception was Nissan Motor Co., which posted another month of declines in what’s shaping up to be a painful year.

Ouch. How bad at Nissan, you ask?

Nissan continued to suffer from its annus horribilis in 2019, posting a 9.1% drop in sales to 98,880 vehicles.

Falling demand for mainstays such as its Rogue SUV and Altima sedan overshadowed a rise in deliveries of its lower-volume Kicks subcompact crossover and aging Frontier mid-sized pickup. The carmaker’s sales in the U.S. are down 8.3% so far this year.

The automaker plans to trim its global lineup and production capacity by 10% as part of a broad restructuring effort.

“We’re on the plan that we set out for ourselves,” Billy Hayes, division vice president for Nissan brand sales, said in an interview. “A lot of the decrease year-over-year was Altima,” reflecting inventory clearance for the sedan in 2018 ahead of the launch of a new version last fall, he added.

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Dammit, Altima! This is all your fault, isn’t it.

Anyway, analysts are quick to note that the good sales figures posted by some automakers are no reason to be optimistic long-term:

While those initial reports from July are upbeat, the enthusiasm from car-market researcher Edmunds is tempered at best. Automakers and their dealers had one more selling day last month than a year ago, leading analysts to caution that “this is not the first sign of a turnaround.”

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“Annus horribilis.” That really says something.

2nd Gear: Oh Right, Also Ferrari Is Down Somehow

This one will not make a ton of sense to non-businesspeople, but shares are down at Ferrari even though things seem nominally good for its operation of selling cars to human beings.

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As Reuters reports, sales of the low-end Portofino are up, though down on some of its higher-cost/higher-margin other vehicles. But that doesn’t mean that everything is good. Per Reuters:

Releasing its second quarter results, the company confirmed that it was on track for the higher end of the guidance range for all relevant figures.

However, there was some disappointment as many investors and analysts thought a potential upgrade was in store after a forecast-beating first quarter.

“The market was expecting them to raise their guidance for the year,” a Milan-based trader said.

Trading in the company’s Milan-listed shares was halted for excessive declines after a 6.9% drop. They were down 4% by 1135 GMT.

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It goes to show that being a car company means more than just making good cars that people want to buy.

3rd Gear: Trucktopia Still Keeping GM Up

GM might be still in the midst of a really messed-up period of plant closures and cut cars, but hey! Trucks!

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Via Reuters:

GM shares gained 3.3% to over a one-year high.

Virtually all of the No. 1 U.S. automaker’s profit came from North America, where it posted a profit margin of 10.7% and profits came in $400 million ahead of analysts’ expectations.

Evercore ISI analyst Chris McNally, in a research note entitled, “Truck, truck and away...,” said the rest of the year and 2020 could be the company’s “time to shine.”

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Wow this cannot ever blow back in GM’s face and will not be bad at all ever.

4th Gear: Tesla Sued For Another Fatal Autopilot Crash

Tesla could have it so easy. It makes desirable electric cars at a time when that’s exactly what automakers need to offer. And yet it still gets itself into trouble, particularly around its horribly-branded Autopilot system, which has now gotten it sued after another fatal crash in Florida, as Bloomberg reports:

Tesla Inc. was sued for the second time in three months by the family of a car owner who was killed in a crash while using the driver-assistance system Autopilot.

Jeremy Banner, 50, died when the Model 3 sedan he was driving failed to brake or steer to avoid a semi trailer that ran a stop sign on a Florida highway in March, according to the lawsuit, which also names the driver of the semi as a defendant.

Banner had engaged the Autopilot system about 10 seconds before the collision. Representatives for Tesla didn’t immediately respond to a request for comment on the suit, which alleges that the company knew its product was defective.

The National Transportation Safety Board issued a preliminary report on the crash in May and said data from the vehicle showed Autopilot was active at the time of the incident. The preliminary data indicated that neither the driver nor the Autopilot system executed evasive maneuvers.

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It was in Florida where Autopilot had its first fatal wreck, all the way back in 2016.

As ever, these transitionary systems between full autonomy and full human control will always be troubled.

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5th Gear: Premium Gas Expected To Get More… Premium

I mostly enjoy this story because of the angle that Bloomberg uses. “It’s going to get even more expensive to gas up your Maserati,” the outlet begins, noting that as the U.S. transitions to cleaner fuel, that will force oil companies to use more expensive additives to get high octane at the pump. Via B’Berg:

With change it will get harder for refiners to keep the octane high enough to meet the needs of high-performance engines. That’s boosting demand for a key ingredient, known as alkylate, and threatening to add to the cost of filling up a Mercedes or Lamborghini.

“We believe we’re seeing octane get more and more expensive,” Homer Bhullar, vice president of investor relations at Valero Energy Corp., told analysts during the companies second quarter earnings call.

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Of course what all this means is that your Lamborghini, which you definitely have because you are reading Bloomberg, will get costlier to run. Drat.

Reverse: One Of The Gnarliest Race Tracks In History Still Stands

AVUS is still around, and you can drive on it as part of the normal highway system, if you’re curious. Via 365 Days Of Motoring:

The AVUS circuit in Berlin staged a Formula One race, the German Grand Prix, for the first and only time (although it had hosted the German Grand Prix once before in the pre-Formula One era). Run over two 30-lap heats, Scuderia Ferrari claimed the first three places. British driver Tony Brooks was declared the winner ahead of American teammates Dan Gurney and Phil Hill. All three drove Ferrari Dino 246S.

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Neutral: When Will Nissan Have Turned It Around?

Let us assume that Nissan executives are in a daily scram to make the company better. I mean, they probably have been for a few months now, at least since Operation Ghosn has kind of blown up in everyone’s face.

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When do you think we will look back on this period as a moment in the past? And what new car or what new initiative is going to get it there? An EV SUV everyone can afford? A new Z that people can afford? More crossovers? An Altima/Maxima relationship that makes sense?

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About the author

Raphael Orlove

Raphael Orlove is features editor for Jalopnik.