The Renault Zoe Is Killing It

Illustration for article titled The Renault Zoe Is Killing It
Image: Renault
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The Renault Zoe is the EV champion, Volvo’s transition to electrification is coming along, Carlos Ghosn’s son apparently used cryptocurrency to helped Ghosn flee, and more issues with car manufacturing in Mexico. All that and more in The Morning Shift for July 24, 2020.

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1st Gear: The Renault Zoe Is Europe’s Electric Car Champion

Thanks to this week’s earning’s report, all eyes were on Tesla, though as Bloomberg points out, Renault also announced some exciting results this week: The Renault Zoe is an EV powerhouse.

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Yes, Tesla is clearly a higher-profile brand, but the numbers don’t lie; The Renault Zoe is, and has been for a while, Europe’s best-selling electric vehicle. This week’s results show just how well the car is moving off dealer lots. From Bloomberg:

The Zoe started plodding along three years [after the Frankfurt motor show unveiling in 2009]. A couple of reboots and redesigns slowly raised its profile with consumers. Then, within the past year, something clicked. At almost 38,000 unit sales in Europe during the first six months of 2020, the four-door hatchback bested Tesla’s Model 3, Volkswagen AG’s electric Golf and Nissan Motor Co.’s Leaf.

“It’s basically the same car that’s been around for a long time,” albeit with some improvements in range, technology and design, said Felipe Munoz, an analyst at auto industry research firm Jato Dynamics. “So the latest success is a bit surprising.”

The story goes on to mention incentives as a key role in the Zoe’s success (you might have read recently that, in Germany, folks are leasing Zoes for free, as the lease cost is entirely covered by government incentives). Again, from Bloomberg:

It’s not quite as astonishing when considering the incentives now available to car buyers who are willing to go electric in France and Germany. The French government is offering as much as 7,000 euros toward the purchase of an electric car, and a cash-for-clunkers program can add another 5,000 euros in subsidies. Germany is offering incentives of as much as 9,000 euros per vehicle.

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It’s a roughly 30,000 Euro hatchback with a 52 kWh battery that allows up to 245 miles of driving range. It looks cool and practical, and with decent range and affordable pricing backed by heavy incentives, I get the appeal.

2nd Gear: Volvo’s Transition To Electrified Powertrains Apparently Hasn’t Tanked Profitability

Electric cars are expensive to develop and manufacture (thanks largely to battery costs), so you’d think they’d offer automakers less room for profit compared to, say, an old diesel car using powertrain parts that have been around for decades. There’s obviously some level of truth to that, but—likely due, in part, to government incentives helping bring down costs for consumers—it turns out that Swedish automaker Volvo isn’t really struggling too bad as it transitions more towards electrification.

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This is according to an Automotive News story about Volvo’s plug-in hybrid sales, which are apparently going fairly well, and putting Volvo in line to meet its target of selling 20 percent electrified cars this year. Here’s what CEO Hakan Samuelsson said about the company’s profitability as Volvo transitions away from diesels towards electrification:

Samuelsson added that Volvo’s profitability has not suffered as it has transition away from a heavy reliance on diesels, which accounted for about 45 percent of Volvo’s European sales in the first half, down from nearly 60 percent during the same period last year.

“Revenues [from the sale of plug-in hybrids] have covered the material cost increase from moving to electrification,” Samuelsson said. “Long term, what would be really bad for your profitability is trying to sell those old school cars.”

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While we’re on the topic of Volvo and electrification, let’s look at what Robin Page, Volvo’s Senior VP of design, said to Auto Express about Volvo’s electric future. From Auto Express:

Speaking exclusively to Auto Express, Volvo’s Senior Vice President of Design, Robin Page, told us that in combination with the firm’s focus on electrification, Volvo’s future model line-up will be very different to what we see today.

[...]

Page said that electric vehicles and SUVs “contradict each other”, so the firm is looking at solutions for future models which will allow customers the models they want – SUVs – with the electric technology that is required to meet CO2 targets.

[...]

“How does the world look when you have people wanting that high position and all the usability of an SUV, balanced with the fact they want range? Clean aerodynamics.”

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More sleek EV SUVs are coming from Volvo.

3rd Gear: Volvo Is Reeling It Back In

But things aren’t perfect. We reported earlier this week on a Financial Times story about how Volvo seems to think the second half of this year is going to be pretty decent, sales-wise. But despite that, Automotive News reports, the company is reeling in its 800,000-car sales goal. Maybe it’ll happen in 2021, but not in 2020. From the news site:

“There will probably be a year delay,” CEO Hakan Samuelsson said. “Before the pandemic we were on track to reach that or come very close to that.”

Volvo would also fail to set a global sales record in 2020 because it won’t be able to top the 705,452 vehicles is sold in 2019, its seventh consecutive year of record volumes.

“In the first half we lost 21 percent, which is almost 71,000 cars,” Samuelsson told Automotive News Europe. “Therefore, even if we reach what we are forecasting for the second half, which is a return to the sales volume we saw last year, the year as a whole will be less than in 2019.”

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4th Gear: Carlos Ghosn’s Son Was Apparently Involved In The Elaborate Escape Effort

Nissan boss Carlos Ghosn escaped Japan after being detained on charges of financial crimes, and the flight wasn’t exactly conventional. It is said to have involved a music case, a former member of the U.S. Army Special Forces named Michael Taylor, and lots of money, with Reuters mentioning earlier this month that Ghosn transferred funds to a company run by Michael’s sons:

Tuesday’s filing in Massachusetts federal court shows wire transfers last October of $540,000 and $322,500 from a bank account in Paris to Promote Fox LLC, a company managed by Peter Taylor and a brother.

The filing does not say how much the Taylors were paid, but prosecutors said it reflects “additional evidence” that they have the resources to flee, and should remain detained as “flight risks.”

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Now we’re learning that it may not have been just Michael Taylor who got his sons involved. Carlos Ghosn’s son apparently wired more cryptocurrency to the Taylors’ company, with Reuters writing:

Federal prosecutors in filing late on Wednesday said the payments went to Peter Taylor after he and his father, U.S. Army Special Forces veteran Michael Taylor, helped Ghosn flee in a box and private jet to avoid facing financial charges.

The cryptocurrency, or digital currency, payments from Ghosn’s son, Anthony Ghosn, were on top of $862,500 Ghosn himself had wired to a company Peter Taylor managed in October, two months before his Dec. 29, 2019 escape, prosecutors said.

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This was a hell of a father-son project for these two dads.

5th Gear: VW’s Dealing With Union Negotiations In Mexico

Right now, automakers who build cars in Mexico (that’s quite a few companies) are dealing with all sorts of disruptions as the coronavirus continues to wreak havoc on the U.S.’s southern neighbor.

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Earlier this month, Ford’s President of the Americas and International Markets group Kumar Galhotra told Automotive News: “Due to COVID-19, the State of Chihuahua in Mexico has limited employee attendance to 50 percent, a region in which we have several suppliers... With our U.S. plants running at 100 percent, that is not sustainable.” The same news outlet also wrote this week about Volvo’s supply chain woes.

And then Ford faced supply chain problems as a result of a railway blockade, as we covered yesterday. From Reuters:

Over the past couple of days, members of the local the Yaqui indigenous community who are demonstrating for better land rights, have blocked railways used to move auto parts, as well as grains and steel, from Sonora to the United States.

“The recent blockade of the rail network in the municipality of Guaymas, Sonora, has affected operations at our Hermosillo plant,” Ford said in an emailed statement.

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Clearly, building cars in Mexico has gotten tricky for a number of automakers. And now Volkswagen, in addition to dealing with coronavirus-related restrictions, has to handle union wage negotiations at the company’s Volkswagen’s Puebla, Mexico plant. From Reuters:

After suspending operations in Mexico for more than three months to contain the pandemic, the automaker faces a contract negotiation in which its unionized workers in Puebla are seeking a 12 percent wage increase.

Workers could go on strike starting Aug. 18 if their demands are not met, the union told local media.

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The plant, which, according to Automotive news employs over 11,000 people, builds the VW Tarek, Tiguan, Golf, and Jetta.

Reverse: 1910: Alfa Romeo Is Founded

From Alfa Romeo’s official site:

24 June 1910. In Milan a new company is founded with the name of A.L.F.A. (Anonima Lombarda Fabbrica Automobili). A few years later, Neapolitan entrepreneur Nicola Romeo takes over the company and changes its name to Alfa Romeo.

From the 24 HP – the first model – to the green Quadrifoglio badge. From the mythical Tazio Nuvolari and Enzo Ferrari, to the legend of Nino Farina and Juan Manuel Fangio. From victory in the first motor racing world championship with the P2, to conquering the first Formula 1 championship with the Alfetta 158. From the Giulietta to the Spider, from the Giulia dynasty to the Tipo 33 project. Rediscover with FCA Heritage the achievements, the cars and the people that contributed to the Alfa Romeo myth.

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Neutral: Do You Want A Renault Zoe?

We don’t get them in the U.S., but do you want more cars like this? We have the Leaf and Bolt, but are you yearning for more cheap EV options?

Sr. Technical Editor, Jalopnik. Always interested in hearing from auto engineers—email me. Cars: Willys CJ-2A ('48), Jeep J10 ('85), Jeep Cherokee ('79, '91, '92, '00), Jeep Grand Cherokee 5spd ('94).

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Neutral: Do You Want A Renault Zoe?”

No, they explode frequently, cause cancer, and make you impotent. I would not consider this car.

- Elon.