Nutson's Weekly Automotive News Digest - April 21-27, 2019
Ford 1Q Results $34 Million Loss But Optimistic, Mid-engine Corvette Second Shift, Japan Ghosn Saga Continues, Lexus Makes Smiles In Canada, Tesla Follies, Ford Makes EV Startup Rivian HAP-PY!, Hyundai Hires EX Nissan Exec As COO, Mazda Diesel Finally, Grid Shortcoming Coming, Airbag Concerns Hits 12.3 Million Vehicles, Waymo Motor Citys, BMW Recall, Tire Chalking Illegal, Indycar New Safety Device, RIP NASCAR MOM and Wife
AUTO CENTRAL CHICAGO - April 28, 2019; Every Sunday Larry Nutson, Executive Producer and Chicago Car Guy along with senior editor Thom Cannell from The Auto Channel Michigan Bureau, give you The Auto Channel's "take" on this past week's automotive news, in easy to "catch up" with news nuggets.
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Nutson's Weekly Automotive News Digest - "Don't Miss" Car and Truck News Made April 21-27, 2019
* Ford revealed its first quarter 2019 financial results this week showing a substantial gain in earnings before interest and taxes but a reduction in net earnings. The company has been restructuring many of its international operations resulting in losses that affect the net earnings. Performance in North America was strong bringing the EBIT to $2.4 billion. Outside the U.S. EBIT showed a $196 million loss. Overall, Fords financial position strong, they insist.
* Expecting an enthusiastic reception for the next-generation mid-engine Corvette, :GM is adding a second shift - about 400 jobs - to the Bowling Green, Kentucky plant. The official launch of the car will be in mid July. The plant has gotten more than $900 million in upgrades to make the new car. Enthusiasts have been teased with rumors of a mid engine Vette for decades, and we can say with confidence they’ll finally get it. The final C7 Corvette will be auctioned off in June to benefit the Stephen Siller Tunnel to Towers Foundation. It's a 2019 Z06 painted black, and will be the last of the front-engined Corvettes.
* And the beat goes on! Japanese prosecutors have again formally charged Carlos Ghosn, the former head of the Nissan-Renault auto alliance. This time its breach of trust, piling a new count of financial impropriety onto his existing charges in a move that adds pressure on him. Mr. Ghosn, who continues to maintain his innocence, has been in a detention center on the outskirts of Tokyo since April 4, when prosecutors swarmed into his apartment in an early morning raid. Late word is that Ghosn has again been released on $4.5 million bail.
* After many rounds of bad news for their auto manufacturing sector Canada finally got some good news this week: Lexus will be building their NX small crossover and the three row version of the popular RX midsize crossover at the Cambridge, Ontario plant beginning in 2022, according to reporting by Bloomberg. Within the last year GM and FCA have cut production and idled plants in Canada. The company is investing C$1.4 billion to prepare for the upgrades needed for those two vehicles and the new RAV4.
* We'll believe it when we see it. Tesla's Elon Musk has been blowing his horn a lot for what usally turns out to be false. Now, Musk said the company was on the verge of building cars that can drive themselves safely on any road. He also said the company would begin operating a fleet of driverless “robo taxis” by the end of next year. Most auto executives and analysts think Musk is being wildly optimistic. Cars that can drive themselves at all times under all conditions are at least several years away...perhaps ten years.
* Ford is partnering with other automakers as it develops electric vehicles investing $500 million in startup EV company Rivian to use their “skateboard” platform to develop a new EV. What kind of vehicle it will be has not been announced. Ford is also in discussions with VW about sharing their EV technology. Companies around the world are putting R&D resources in the development of EVs even though demand for them is still a tiny part of the total market.
* Meanwhile, this. Tesla said it immediately sent a team to investigate an apparent explosion of one of its cars that occurred in Shanghai. There are no known casualties at this time, the electric car company said in a Chinese-language post on Weibo, China’s version of Twitter. Tesla also said it is in active communication and cooperation with relevant departments about the situation.
* Former Nissan executive Jose Munoz, a Carlos Ghosn lieutenant who left Nissan as scandal engulfed his former boss, has been hired as COO and head of Americas operations at South Korean automaker Hyundai. Auto industry analysts view this move as a clear sign of change to come.
* Coming back to the recent 2019 New York International Auto Show, at long last we saw the arrival of Mazda's Diesel engine. The 2019 Mazda CX-5 Signature AWD features the 168 horsepower Skyactiv-D 2.2-liter diesel engine with 290 lb-ft of torque at 2,000 rpm. EPA estimated fuel economy ratings are 27 city mpg, 30 highway mpg with 28 mpg combined. Compared to gasoline engines offered on the CX-5 the ratings are 3 to 5 mpg better in the city, depending on the engine. With an MSRP of $41,000 pre-sales are beginning immediately.
* Joe White for Reuters reports, electric and plug-in hybrid vehicles account for roughly 1 percent of U.S. vehicle sales today, but consulting group BCG forecasts they will rise to 20 to 30 percent of new vehicle sales by 2030, requiring that electric utilities beef up the grid to handle the recharging load. U.S. EV and plug-in sales have been growing at a rapid rate, but from a very low base. The big test of all EV/PHEV sales forecasts is coming over the next five years.
* David Shepardson writing for Reuters reported that NHTSA said that it is expanding a probe into potentially defective air bags to 12.3 million vehicles. The agency said the air bags were installed in some vehicles from model year 2010 through 2019 sold by Fiat Chrysler Automobiles NV, Honda Motor Co, Hyundai Motor Co, Kia Motors Corp, Mitsubishi and Toyota Motor Corp. They were equipped with an air bag control unit initially produced by TRW Automotive Holdings Corp now owned by ZF Friedrichshafen. The agency said they could fail during a crash event.
* Waymo will lease an American Axle factory in Detroit to build Level 4 self-driving vehicles. Waymo will modify Chrysler Pacifica and Jaguar I-Pace vehicles and retrofit them with autonomous car technology. Level 4 is high automation, one step below full automation. That means the vehicles can't do everything and must operate under prescribed circumstances. The driver may have the option to control the vehicle.
* Automotive News reports that the Justice Department has opened a criminal investigation into Ford Motor Co.’s emissions certification process, the automaker disclosed two months after fessing up to an issue with its testing. Ford is fully cooperating with all government agencies, the automaker said in a regulatory filing. The company said that because the matter is still at a preliminary stage, it can’t predict the outcome or assure investors it won’t have a material impact on the company. Ford revealed in February that it had been taking a flawed approach to using road-load specifications to simulate how aerodynamic drag and tire friction can affect fuel economy outside testing labs. It hired an outside firm earlier this year to help conduct an investigation that could stretch into the summer.
* BMW is adding nearly 185,000 vehicles in the U.S. to a 2017 recall for possible engine fires. Two years ago the company recommended the vehicles be parked outdoors until problems are fixed. The expansion brings the total number of vehicles recalled for the problem to about 925,000. The recall expansion covers a dozen 3 Series, 5 Series and Z4 models from the 2006 model year.
* A Saginaw, Michigan motorist beat a parking ticket with a claim of unwarranted trespass. A three-judge U.S. Court of Appeals panel found that the practice of chalking tires violates the Fourth Amendment’s prohibition on “unreasonable search and seizure.” The young woman bringing the suit is described as a “frequent recipient of parking tickets.” The decision constitutes precedent throughout the 6th U.S. Circuit - Michigan, Ohio, Kentucky and Tennessee.
* IndyCar drivers will be using a new safety device starting at next month's Indianapolis 500. Seies officials announced that each car will be fitted with a 3/4-inch wide titanium debris deflector, which is intended to protect the driver's head in the open cockpit.
* Brenda Jackson, the mother of Dale Earnhardt Jr. and Kelley Earnhardt Miller, has died at the age of 65. JR Motorsports announced the news Monday afternoon, saying that Jackson had been battling cancer. Prior to her marriage to seven-time NASCAR premier series champion Dale Earnhardt Sr. in 1972, she was known by her maiden name, Brenda Gee. Her father was well-known NASCAR fabricator Robert Gee, who built cars for several stars of his era, including Earnhardt.