It’s possible that things are doing just fine at Apple’s beleaguered car project and that Ford is just looking to nab a headline or two poaching the head of the tech company’s program. I mean, it’s possible. All that and more in The Morning Shift for September 8, 2021.
1st Gear: Head Hired By Ford
There are some dire pronouncements about this one popping in from experts:
Let’s look at the details, from Bloomberg:
The automaker said Tuesday that it’s bringing on Doug Field, who’s been a vice president in Apple’s special projects group. Field was a top engineer at Tesla Inc. between two stints at Apple and played a major role launching the Model 3 sedan.
Field joins the automaker as chief advanced technology and embedded systems officer, reporting to President and CEO Jim Farley.
F-1.37% reversed a decline on the news to close Tuesday’s trading up less than 1 percent to $12.95, while Apple closed up about 1.6 percent to $156.69, off its high for the day.
The Financial Times claimed this move “potentially spells the end of the iPhone maker’s automotive ambitions,” but another FT story points to another side of the deal:
Before the semiconductor shortage, sales of trucks and SUVs were solid. Ford’s hyped F-150 electric truck has secured 120,000 orders and its Mustang Mach-E is the second-best selling electric SUV in America. Ford’s shares have rebounded by nearly half in 2021, which gives it a market value of roughly $52bn.
This still trails Tesla and even Rivian. The latter Amazon and Ford-backed EV truck start-up is seeking a $70bn initial public offering, offering a pricier rival to Ford’s own models. Ford will hope hiring Field away from Apple can add some air to its own valuation.
That is to say, it’s hard to pinpoint exactly how much this does or does not affect Apple, but it is clear that the move is boosting Ford’s stock price. Maybe that’s all that’s really happening here. I might not bet on it, though, given the public failure that Apple’s relatively secretive program has gone through in the past year. Even Hyundai/Kia kicked it to the curb. Not the best look.
2nd Gear: Something’s Going On With Germany’s Eco Cars
The German government has a close relationship with the German auto industry for reasons of strict self-preservation. Cars represent Germany’s export industry, both in terms of finances and prestige, so it’s not surprising when you see Germany’s government going to bat for its automakers. More surprising is when there is conflict:
Things are yet stranger in this Financial Times story on the ongoing auto show in Munich. The German government is pushing hydrogen; its biggest carmaker scoffs at hydrogen:
On the eve of the show, VW’s chief Herbert Diess rejected claims it was slow-moving with its carbon reduction plans. “We are really fast . . . can we do it faster? No,” he said. “It’s impossible because this transition is so complicated, requires so much investment.”
Daimler’s chief Ola Kallenius said it was “not 100 per cent in the hands of the manufacturers to decide the speed”, pointing to the need for governments to invest in charging infrastructure to ramp up demand, while BMW’s boss, Oliver Zipse, said his company was focused on remaining profitable through the transition. “If you say that 50 per cent of the market in Europe will be pure electric in 2030, there is still the other 50 per cent, and if you say you will not serve [this 50 per cent] you are setting yourself on a course to shrink,” he said.
The three have also been unsupportive towards Germany’s push for greater use of hydrogen as an alternative fuel. “You won’t see any hydrogen usage in cars,” Diess told the FT emphatically in March.
I don’t know how this is going to resolve, but I’m going to keep my eye out for government pressure against dissenting automakers.
3rd Gear: VW’s In-Car Payments Program Sells Out
Speaking of VW, its in-car payment system is getting more investment, as Reuters reports:
JPMorgan has struck a deal to buy a majority stake in German car giant Volkswagen’s payments business ahead of a planned rollout of in-car technology that allows drivers to automatically pay for fuel or tolls.
The U.S. bank on Wednesday said it agreed to buy 75 percent of Volkswagen Payments for an undisclosed sum, subject to regulatory approvals.
The Luxembourg-based business was founded in 2017 and operates across 32 countries. It offers car purchase and leasing, in-vehicle payments, fueling and EV charging and subscription services such as insurance and in-vehicle entertainment.
4th Gear: German Carmakers Very Mad At Protesters
And speaking of German carmakers in general, they are not stoked with Greenpeace showing up to block traffic around Munich during the celebration of all things automotive, as Der Spiegel reports:
Representatives from industry and politics voiced criticism of the protests at the IAA in Munich . Of course, demonstrations and expressions of opinion are always possible, said Bavaria’s State Chancellor Florian Herrmann (CSU). But there is also a framework of laws for them. If other people were endangered by the actions, this cannot be tolerated.
ANZEIGE
“The IAA Mobility shows the way to climate-neutral mobility,” said Hildegard Müller , President of the Association of the Automotive Industry (VDA), which organizes the trade fair. “And we also discuss with those who disagree. Our offer for dialogue is in place. We reject violence and coercion. “
According to Der Spiegel, “[h]elicopters and alpine special forces were in action,” which sounds excessive.
5th Gear: China Has Lots Of EV Carmakers, Not A Ton Of Resources For Them
China’s EV boom might be forced into some level of bust, as Bloomberg reports that the government there is looking to “better target resources for EV production,” a weird phrase in its own:
The average production capacity utilization rate for automakers in China overall was about 53 percent last year, according to Bloomberg calculations based on a Jiangsu province submission to the NDRC earlier this year. China has around 300 EV makers, according to a Xinhua report in April citing official statistics.
Officials from MIIT and the NDRC said over the weekend that one key task for regulators is to ensure a good supply of the raw materials used in EV batteries, such as lithium, nickel and cobalt. The yearlong chip shortage has also curtailed production, further underscoring the importance of matching production capacity to demand.
I’m not so sure. One country having 300 car companies seems like a good and sustainable number.
Reverse: Here’s Some Fun Transportation History Spotting I Learned About From A Tweet
This is a cute little thread on bridge construction. I hope to use it soon to bore everyone around me.
Neutral: How Are You?
My cucumber plant has put out a few new flowers this morning. The first flowers of a new year!