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.
1st Gear: NHTSA Is One Step Closer To A Potential Ford Explorer Recall
The U.S. National Highway Traffic Safety Administration is expanding its investigation into potential carbon monoxide exposure to include 1.33 million Ford Explorer SUVs, Reuters reports.
NHTSA said 2,700 complaints and three crashes may be linked to exposure to carbon monoxide in 2011-2017 model year Ford Explorers. The government agency opened the probe in 2016 by investigating 638,000 vehicles.
NHTSA also upgraded the probe to an engineering analysis, which Reuters says is a step before the agency can formally demand a recall from the automaker:
The agency said it had “no substantive data or actual evidence,” such as a blood test “supporting a claim that any of the alleged injury or crash allegations were the result of carbon monoxide poisoning.”
But NHTSA has obtained preliminary testing that suggests carbon monoxide levels may be elevated in certain driving scenarios, “although the significance and effect of those levels remains under evaluation.”
The agency said it was examining vehicles used by the Austin, Texas, police department and “using professional grade detectors to monitors carbon monoxide under different driving scenarios.”
Austin police pulled 40 Ford Explorers from service after more than half a dozen officers became ill from exposure to carbon monoxide.
2nd Gear: Musk’s “Mass Market” Tesla Could Miss Mass Market
Elon Musk will host his much-anticipated Model 3 handover party for the first 30 customers of the model later today. Musk has repeatedly said this $35,000 sedan will bring Tesla to the masses, but analysts predict the car will actually cost much more.
“Thirty-five grand is going to get you a very basic model,” David Whiston, an auto analyst with Morningstar Inc. told Bloomberg. “The average Model 3 is going to be more like $42,000, and a fully-loaded one will probably be in the $60s. It’s not a mass-market car.”
We’ve talked about how the price sticker could decrease after federal and state tax incentives for going electric, but the price benefits wouldn’t help much if the car comes in at $60,000.
What the Model 3 ultimately costs will determine how many consumers make the jump from a refundable $1,000 deposit to the driver’s seat. For the youngest publicly traded U.S. automaker, pulling off the price point — and doing so at a profit — is critical in its bid to reach a substantial swath of consumers.
Musk has a habit of over-promising, and under delivering, on his long-awaited effort to bring Tesla to a mass market. We’ll see if he can pull this promise off.
3rd Gear: Wells Fargo To Refund $80 Million To Customers Overcharged By Auto Loan Insurance
Wells Fargo will reimburse $80 million to 570,000 that may have been unfairly charged high auto collateral protection insurance, Reuters reports.
Wells Fargo recently reached a $190 million settlement with regulators over complaints that its retail banking staff opened as many as 2.1 million unauthorized client accounts. The bank previously fired 5,300 employees for improper sales tactics over five years, but did not change its policies or procedures until recently.
“We take full responsibility for our failure to appropriately manage the CPI program and are extremely sorry for any harm this caused our customers,” said Franklin Codel, head of Wells Fargo Consumer Lending.
The bank said it had started a review of the CPI program in July 2016 and discontinued the program in September, based on the findings.
New York Times reported earlier that more than 800,000 people who took car loans from Wells Fargo were charged for auto insurance they did not need, and some of the customers were still paying for it. nyti.ms/2tIdyUE
About 490,000 customers had duplicate vehicle insurance coverage and about 60,000 customers did not receive complete disclosures from vendors, prior to CPI coverage, Wells Fargo said.
4th Gear: U.S. House Moves Forward With Landmark Self-Driving Law
The House Energy and Commerce Committee unanimously approved the Self Drive Act, the country’s first federal legislation that regulates the manufacturing, testing and deployment of driverless cars.
The legislation aims to eventually put 100,000 autonomous and semi-autonomous vehicles on public roads. The legislation started in one of the House Energy and Commerce subcommittees and was crafted by both Republicans and Democrats.
The legislation gives automakers guidelines for testing the technology and pre-empts states from establishing their own laws. Critics say the law doesn’t go far enough and could potentially lead to crashes.
Automotive News reports:
In a letter to committee members, a coalition of safety groups said states should not be restricted from establishing rules of the road for autonomous vehicles until the National Highway Traffic Safety Administration issues driverless vehicle regulations. They also reiterated concerns about the number of exemptions and that exemptions should not apply to crashworthiness standards.
The bill also represents a compromise to satisfy auto dealers’ concerns about franchise laws and how they apply to the sale or servicing of self-driving vehicles.
The bill includes new language requiring automakers to develop plans for protecting consumers’ data privacy since autonomous vehicles will collect and transmit massive amounts of data to facilitate safe operation and offer entertainment options for occupants.
5th Gear: Ford Brings Ride-Sharing Unit To NYC
Ford will bring its acquired shuttle service Chariot to New York City following expansions to Austin and Seattle earlier this year, the company stated on Thursday. Ford aims to expand to eight cities globally by the end of the year.
Chariot uses 12-seat Ford Transit vans and real-time traffic data to shuttle people between their homes and transit centers like train or subway stations, Auto News reports.
The shuttle service will launch in Manhattan and Brooklyn for a flat rate of $4 per ride at two planned service areas. Chariot will use 60 vehicles in New York by the fall.
The Italian race car driver Tazio Nuvolari wins the greatest victory of his career in the Grosser Preis von Deutschland (German Grand Prix) held on the Nurburgring racetrack in Nurburg, Germany on this day in 1935.
Known to his fans as “Il Montavano Volante,” or the Flying Mantuan, for his home city of Mantua, Nuvolari served as a driver in the Italian army before beginning his career racing motorcycles at the age of 28; he won the Italian championship in that sport in 1924 and 1928.
The German Grand Prix of 1935 is remembered as Nuvolari’s greatest victory, and arguably one of the most impressive auto racing victories of all time. An estimated 250,000 to 300,000 spectators turned up to watch the race on that rainy, foggy July day, and drama broke out from the beginning, when Nuvolari’s longtime rival, Achille Varzi, driving for the German Auto Union, hit an auto mechanic working the race.
Neutral: What Should The Model 3 Cost?
We car enthusiasts love to complain about how expensive modern cars are! So here’s your chance: what’s an acceptable price for the “mass-market” Model 3? What should it cost?
Updated July 28 2:34 EST: Ford provided a statement regarding the Explorer probe: “Safety is our top priority. A dedicated Ford team is working with police customers, police equipment installers, Police Advisory Board members and NHTSA to investigate reported issues and solve them. Customers with concerns about Explorers and Police Interceptor Utilities can call our dedicated hotline at 888-260-5575 or visit their local Ford dealership.”