Tesla's Tough Year In China Is Getting Worse

Tesla is facing yet more headwinds in the biggest car market in the world, Ford is now making more of the other Mustang, and Nissan's long-awaited electric vehicle that isn't a Leaf has seen another delay. All this and more in The Morning Shift for Friday, June 4, 2021.

Tesla's not-so-great year in China is not improving. The EV maker reportedly sold a little more than half the cars in May as it did in April in the country. That comes after a protestor shouted about faulty brakes in the Model 3 at the Shanghai Auto Show, the government alleged that the company's cars posed a national security risk, and Tesla-owning state officials were advised to drive something else.

A report from The Information on Thursday put Tesla's issues in China into perspective:

The company's monthly net orders in China dropped to about 9,800 in May from more than 18,000 in April, according to a person with knowledge of the data. The sharp drop reflected a drastic shift in Chinese consumers' appetite for Tesla, whose founder Elon Musk has celebrity status there. Orders spiked in January after the release of the Model Y SUV, and then slowly eased off before cratering last month. In March, Tesla had 21,000 net orders. Even on a week-over-week basis, orders so far haven't shown any signs of recovery, this person said.

Couple those controversies in China with brake- and seatbelt-related recalls here in the U.S., and the result has sent Tesla's stock sliding. It was down another 5.3 percent yesterday according to Bloomberg, after falling nearly 30 percent from its 2021 peak in January.

On Thursday, Stellantis held a gathering in Detroit to announce a $1 million investment in the neighborhoods surrounding its Jefferson North Assembly Plant and the new Mack Assembly Plant. The company reportedly aims to build an "education pavilion" and plant a thousand trees at Stormwater Park. It already set up an "ambient air quality monitoring station" in the area.

Some residents, however, remain unconvinced the automaker is actively doing enough to ensure the environmental wellbeing of its neighbors. "Roughly a dozen" people arrived on the scene to peacefully protest, The Detroit News reported.

"They put a Band-Aid on it," Robert Shobe, a 26-year resident of Beniteau, said of the actions the automaker has taken as part of its community benefits agreement with the city and impact-area residents. "This wouldn't happen in a non-Black community."

Another resident spoke about horrible smells and noise pollution, courtesy of The Detroit Free Press.

Tanisha Burton, 45, was among the protestors. She said she moved to Beniteau three years ago from Taylor and now requires daily treatments for asthma, something that she never experienced before. She's concerned about the health of her three grandchildren who visit her home every weekend and her 87-year-old grandfather who now lives with her.

She and others feel the company should do more for residents who live on Beniteau, which is separated from the plant by a large concrete sound barrier, which critics have compared to the U.S.-Mexico border wall. Murals have been planned for the wall, but they've been delayed because of the pandemic, according to the company.

Burton didn't focus on the wall during her remarks to a Free Press reporter. Instead, she was more concerned with issues such as noise and odor from the plant.

"I shouldn't smell it in my home. It's a foul smell," Burton said. "We hear noise that wakes us up."

She also referenced a key complaint of protesters, who want more money for home repairs or relocation. They say $15,000 to facilitate repairs is not enough. The company said $1.8 million has been provided for home repair grants in the area.

Burton "listed needed home updates like noise and air quality control and repairs to a cracked brick foundation since the expansion at the plant began," The Detroit News added. Yeah, $15,000 does not seem like it's going to put a dent in any of that.

Stellantis's efforts include measures like distributing rain barrels, creating solar-powered bus stops and other green initiatives — projects that sound nice on paper but probably offer little consolation to the people displaced and impacted by all the industrial development. Maybe spare the self-congratulatory back-patting and listen to the residents, for a minute?

It was only a matter of time before Ford reached a point where it was pumping out more electric Mustangs than gas-powered ones, and it appears that moment has come fast. Ford announced Thursday that it's manufactured 27,816 examples of the Mustang Mach-E so far this year, compared to 26,089 Mustang coupes. The Mach-E was the best-selling car in Norway through the month of May, but Automotive News reports Americans are still buying three Mustang sports cars for every single Mustang EV.

On the other hand, Ford likely passed this milestone sooner than it otherwise would have thanks to the trials and tribulations of 2021 manufacturing. Dearborn has apparently directed the majority of its resources toward its new vehicle launches, including the Mach-E, Bronco and F-150 Lightning, and that's left Mustang pony car production in the lurch. From Automotive News:

The global computer-chip shortage hobbling the auto industry played a role in the Mach-E surpassing the traditional Mustang. Farley said the company is prioritizing its newest models, such as the Mach-E and the Bronco SUV, as it distributes its scarce supply of semiconductor modules. Ford's Flat Rock, Mich., factory built no gas Mustangs last month, according to the production data.

"We have purposely protected our launches — Bronco, Bronco Sport, Mach-E, F-150," Farley said. "If we can switch a module over to one of those launch vehicles, we have. We're very protective of the launches because they are so important for our business."

Ford said its supply of gasoline-fueled Mustangs is down to 24 days, about one-third of what is considered a healthy inventory.

...but a rushed Ariya, especially when worldwide manufacturing is still running behind and semiconductor supplies are low, will make for a really frustrating launch. So Nissan has made the decision to delay the introduction of its first fully electric crossover in Japan to this winter, with sales in the U.S. and Europe beginning "around two months later," according to the company's executive vice president, Asako Hoshino by way of Automotive News.

The winter launch was decided due to the fact that the Ariya "is filled with innovative technologies that need to be checked thoroughly, one by one," Hoshino said.

"In some countries it's said Nissan has no face," Hoshino said. "Nissan is a technology company and with the Ariya we hope to embody that."

Nissan expects the chip shortage to impact about 500,000 units of its output this fiscal year. It is prioritizing production of its most popular models, and aims to recover around 50 percent of its lost output in the latter half of the year.

Call me what you like but I think the Ariya is a very attractive crossover, and Nissan has been going through a bit of a renaissance as of late. Not like, a wildly successful one where it's moving upmarket and making amazing stuff like Mazda, but the company's offerings have improved across the board. Between the Ariya, new Z, and heavily refreshed Frontier, there's a lot of Nissan worth looking forward to.

With the mini Formula E exodus of Audi and BMW following the end of the current season, both German luxury brands have had a rethink about where the future of their motorsport efforts will lie. Audi, like its Volkswagen Group sibling Porsche, will look to Le Mans and also the Dakar rally. Audi's sports car effort will come in the form of an LMDh entry, and it seems BMW may follow a similar path.

When asked where BMW's next marquee racing program will be based, BMW M boss Markus Flasch told Motorsport.com to expect more endurance racing:

"I know where we come from, where our roots are, and I think there is room on top of GT3 for BMW. We are looking into other formats than [those] we are currently involved in and there will be decisions quite soon."

Asked by Motorsport.com if the ability to race an LMDh in both the FIA World Endurance Championship and the IMSA WeatherTech SportsCar Championship from 2023 made it attractive, Flasch replied: "Yes it does. That is part of our analysis, absolutely."

Flasch also remarked that BMW is "very interested" in the FIA's new Electric GT category which was announced earlier this year.

"We have been in discussions with the FIA," he said. "If this series is going to be fast enough, spectacular, then we are going to be in it. [But] we are not pushing just because it is electric: it has to make sense for the fan."

It's hard not to construe that as somewhat of a dig at Formula E, which has had equal moments of hopelessness and glory since its inception six years ago. The series quickly became the domain of top manufacturers wanting to present a sporty yet sustainable and technologically forward-looking image, but it's still striving to be taken seriously. These days, manufacturers only have the money to invest in one, maybe two top-flight, factory-backed racing programs, and it's once again time for BMW to decide which those will be.

That was Henry Ford's name for the first gasoline-powered, four-wheeled vehicle he ever built, which he test drove for the first time 125 years ago today. The old story goes that Ford and his assistant, Jim Bishop, were ready to wheel the vehicle out of the shed they'd been working in when they soon discovered it wouldn't fit through the door. So Ford took an axe to the shed's walls and wouldn't you know, it rolled right out just fine.

If you ask me, Hyundai's doing pretty nicely. Its cars are competitive and popular, especially big SUVs like the Palisade and Kia Telluride; Genesis is producing some gorgeous stuff; and it might even launch a mid-engine sports car one day, if those rumors that gained steam last year are credible and the project hasn't been canned in the wake of the pandemic. It's also one of the only companies willing to sell you a hot hatch in North America anymore, which is a very likable quality for an automaker to have, in my book. But who do you think is making all the right moves these days?