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: The Insanity Comes To An End
In a lot of ways, the Volkswagen Group as a whole is the most interesting automaker in the world, and the one with the most diverse lineup by far. Rear-engined sports cars! Sixteen-cylinder hypercars! Diesel microcars! Expensive spaceship sedans!
But in the wake of the coming reorganization after the devastating diesel cheating scandal, Volkswagen will not only retool to focus on electric and hybrid cars but will dramatically scale back the number of models sold compared to what we saw under the reign of former boss Ferdinand Piech. That’s according to German newspaper Handelsblatt, cited in this Reuters report:
Citing company sources, Handelsblatt said the overhaul would also involve ceasing production of more than 40 models. Volkswagen currently makes about 340 car models across its portfolio, which includes brands such as Audi, Skoda and Seat.
A Volkswagen spokesman said, however, the number of models that would be discontinued had not been decided yet. “A decision on how many models will be phased out or ceased has not been taken yet,” he said.
How long can the Beetle Dune Convertible survive under the new regime? Or Ducati?
2nd Gear: While Dealers In America Wait And Lose Customers
Volkswagen could definitely stand to have a leaner lineup more focused on core products, particularly SUVs and crossovers for the U.S. market. Its selection here was never great, but Automotive News has more on how the now nine-month scandal has affected American dealers:
Fred Emich, general manager of Emich Volkswagen in Denver, says VW’s preliminary agreement in April to buy back the affected 2.0-liter diesels and provide owners a “substantial” payout has stalled customers as they await the official rollout of the offers. “They’re essentially frozen in the market because they’d be stupid to trade the car because they’re going to get significantly more from VW when they buy it back,” Emich said.
He says new-car sales at his dealership, where diesels accounted for more than a third of his sales pre-scandal, fell 40 percent last month. He’s selling an average of about 75 new cars a month this year, down from 100 last year.
Emich also says defections are on the rise. He estimates that between 10 and 15 customers each month are exiting leases without leasing or buying a new VW, compared with one or two a month last year, including both gasoline and diesel customers.
3rd Gear: Ralph Nader In The Automotive Hall Of Fame
Yes, there is an Automotive Hall of Fame. And it just inducted several people living and dead, including Bertha Benz, Ford GT40 godfather Roy Lunn, and Ralph Nader.
The induction into the hall (whatever that is, anyway) of the safety advocate who wrote Unsafe at Any Speed will definitely make some car enthusiasts apoplectic, but you can’t deny the influence Nader’s work had on the industry. Via The Detroit Free Press:
Demonized by many within the auto industry for decades, Ralph Nader made history with his 1965 book, “Unsafe at Any Speed,” which savaged the Chevrolet Corvair compact and the industry’s inattention to safety. His work gave birth to the consumer protection movement and began automakers’ evolution into an industry that treated safety systems as prized selling features rather than costs to be avoided.
I’d still daily a Corvair.
4th Gear: What’s The Most Valuable Dealer Chain To Own?
The results will... not surprise you. Via Automotive News:
The survey, conducted twice a year by the National Automobile Dealers Association, is a report card that focuses on three main areas: franchise value, company policies and the brand’s personnel. Results are shared with automakers in a series of meetings of top-level executives from the automakers, dealers and NADA.
Lexus, Toyota and Subaru held the top three spots, unchanged from last year. No surprise there: Lexus and Toyota are highly profitable franchises known for their high sales per dealership, while Subaru’s unit sales have set records for seven straight years. All three brands also are renowned for listening to and acting on dealer concerns.
At the opposite end, the bottom five included four niche players with weak sales and one suffering well-publicized recall problems: Fiat, Smart, Jaguar, Volkswagen and, dead last, Mini.
Poor Mini. People just aren’t buying things that aren’t giant SUVs at the moment. All those reliability issues aren’t helping either.
5th Gear: Warren Tech Center
And finally, the Detroit News has a rundown of all the big changes happening at the $1 billion renovation of General Motors’ Warren Tech Center in Michigan:
Driving much of GM’s upgrades are industry changes, Kelzer explains. GM and other automakers must meet new and more stringent carbon dioxide emissions and federal fuel economy requirements. Those changes are driving more lightweight engines and alternative propulsion systems at a time when the industry is also evolving with development of self-driving cars and services such as car sharing and ride hailing.
The company is renovating offices on the more than 300-acre campus into modern, collective work spaces. It is expanding some locations such as its Alternative Energy Center as the company increases employees and the company focuses on alternative powertrains, autonomous technology, connected vehicles and infotainment, Kelzer said.
Reverse: I’m Sure He Just Loved Doing That
Neutral: What VW Group Models Should Get Cut?
What would you put on the chopping block?