Ferdinand Piëch’s legacy is being unmade, Toyota doesn’t think it’ll beat GM for long, and Vauxhall. All that and more in The Morning Shift for July 6, 2021.
Ferdinand Piëch was the worst/best kind of automaker chairman, a dumb old rich guy who does whatever he wants, thereby giving the rest of us conversation fodder. One of his dumb old rich guy ideas was to buy Bugatti, which everyone kind of just played along with at the time.
Bugatti, whose Chiron model starts at close to $3 million, will become part of a joint venture between Volkswagen’s Porsche unit and Rimac, a young Croatian company that has made a name for itself doing design and engineering projects for large carmakers.
Rimac will own 55 percent of the joint venture, known as Bugatti-Rimac, and Porsche will own 45 percent. Mate Rimac, the 33-year-old founder of Rimac, will be the chief executive. The companies did not disclose financial terms.
Oliver Blume, the chief executive of Porsche, acknowledged Monday that the deal removes a distraction for Volkswagen and allows the company to focus on more important tasks. Those include shifting to production of electric vehicles and overcoming the effects of an emissions scandal.
Volkswagen is out, but Porsche is still in. Porsche has both a 45 percent stake in Bugatti and a 24 percent stake in Rimac, which in turn has the remaining 55 percent of the Italian-French-German supercar maker. All we can really expect is it looks like Bugatti is going electric. Neat.
Toyota outsold GM in the second quarter of this year, which was a landmark of sorts but probably a temporary one, as The Wall Street Journal reports.
Between April and June, Toyota TM 0.31% sold 688,813 vehicles in the U.S., giving it a razor-thin 577-unit margin of victory over GM, according to figures from the two companies. It was the first time a Japanese car maker took the top position in the U.S., according to car-shopping website Edmunds.com, and came as the politically sensitive U.S. trade deficit is widening.
“Toyota thinks this was an unusual case due to production constraints and other factors,” spokeswoman Shino Yamada said. She called it a “short-term event for this quarter.”
Toyota bet earlier than most car makers on a recovering U.S. car market. As a result, the company cut production and parts orders less sharply than competitors, making it better prepared for the current surge.
This is in part because of experience Toyota has that GM simply doesn’t.
Toyota eased away from a strict application of its just-in-time production system, in which parts are delivered to factories right as they are needed. It has said it built up a four-month stockpile of chips and other key parts.
While other car makers were shutting down factories because of the shortages, Toyota was nearly unaffected, according to research firm LMC Automotive. Toyota’s factories have run at over 90% capacity so far this year, compared with 50% to 60% for most of its rivals, according to LMC data.
Vauxhall is a British marque that Americans never think about, and Britons think about maybe even less. It somehow still exists, and, as Reuters reports, Stellantis is going to put $140 million into a Vauxhall plant in England to make electric vans.
The future of Vauxhall’s Ellesmere Port factory had been uncertain since its owner said in 2019 that it wanted to make the new Astra car there, but it would depend on the outcome of Brexit, which was only settled in December 2020.
Stellantis said it had been “supported by the UK government”, having sought a binding commitment from the authorities to make fresh investment. Some car companies have received around 10% towards their investments.
“It’s a huge vote of confidence in our economy, in the people of Ellesmere Port and in our fantastic post-Brexit trading relationships,” Prime Minister Boris Johnson said in a video message.
Congratulations to Boris Johnson, whose core demographic is still mad about something.
I remain pretty skeptical that battery-electric trucks will be a thing when it comes to long-haul trucking — as opposed to fuel cell electric trucks, which are more likely the future there — but companies with a lot more on the line continue to act like battery-electric semis are the future. And I’m not talking about Tesla and its Semi, but Volvo, Traton, and Daimler, who said this week that they were going to invest hundreds of millions of dollars into a joint charging network.
“The key ingredient in the future rolling-out of electric vehicles will be the infrastructure. It will be the big bottleneck,” Martin Daum, chief executive of Daimler Trucks, to be spun off from Daimler later this year, told Reuters.
The three companies, which are all building electric trucks and are normally competitors, will jointly invest 500 million euros ($593 million) in the venture that they will own equally and that will start operations in 2022.
“And thereafter we are very open in all directions to let other parties partner with us and actually bring equity into the joint venture,” Traton CEO Matthias Gruendler said, adding he expected a lot of outside interest once the JV has been set up.
The aim is to install and operate at least 1,700 charging points within five years. The joint company will be based in Amsterdam and will over time seek further partners and public funding.
Jaguar is in the weird space now that Aston Martin was in about a year ago, in that it is an open question whether Jaguar’s long-term future is secure. That will probably be decided by how well Jag switches to EVs and competes with the likes of Tesla, Porsche, and everyone else. In the short-term, there is a chip shortage to worry about, according to the Financial Times.
The company said on Tuesday that chip shortages would be worse than anticipated in the second quarter of its financial year, but that the situation would improve in the second half.
“We now expect chip supply shortages in the second quarter ended 30 September 2021 to be greater than in the first quarter, potentially resulting in wholesale volumes about 50 per cent lower than planned,” the carmaker said in a statement on Tuesday.
Shares in Tata Motors, JLR’s Indian parent company, fell 9 per cent after the announcement.
Wholesale volumes, excluding a Chinese joint venture, came to 84,442 units in the first quarter of the financial year, about 27 per cent lower than planned because of the semiconductor supply constraints and the impact of the coronavirus pandemic. The company said that “this reduction had been broadly anticipated”.
I still aspire to one day get a Snapper lawnmower.
I went golfing on Sunday at Bethpage, which means, because I am in my late 30s, that I haven’t been able to move since. On the way back, on the Grand Central Parkway, it was dumb money car show. Several Ferraris, about eight million new M3s. I even saw an X6 M, easily the dumbest money.