Trade News

A bill signed by Illinois Gov. JB Pritzker reinforces a requirement that automakers pay dealerships for warranty work at the same labor rate consumers are charged.

House Bill 3940, which will take effect Jan. 1, also establishes methodology for calculating the average labor rate and ends automakers' ability to refuse parts markups that they deem "unreasonable."

The current law says manufacturers have to pay dealerships no less than the retail rate for warranty work, adding this charge must be "reasonable" — defined as the market's "prevailing wage rates."

The bill drops those subjective terms and lays out a specific means of calculating the automaker warranty labor rate. This charge will be based upon the average of any 100 sequential customer-pay repair orders submitted to the manufacturer by the dealer. The repair orders must have occurred within 180 days of the submission and will not include "simple maintenance" repair orders.

"House Bill 3940…

TRAVERSE CITY, Mich. — The rise of electric vehicles is triggering big changes in the auto industry. But it will also bring about new innovations in how autos are made and how companies think about their operations, Magna International CEO Swamy Kotagiri told an industry audience Wednesday.

"We know that mobility is evolving fast and at an exponential pace, faster than ever before," Kotagiri said, kicking off the Center for Automotive Research's annual Management Briefing Seminars here.

"It's clear that the next generation of vehicles will be shaped by four simultaneous revolutions happening now: electrification, autonomy, connectivity and mobility as a service, called new mobility."

But he said getting there will cause automotive manufacturers to begin asking new questions about how they do business.

Kotagiri, a longtime Magna executive, stepped into the role of CEO on Jan. 1. The Canadian company is North America's largest auto supplier, with 20…

As Nissan prepares to introduce a second battery-powered model — the Ariya crossover — the automaker is giving its original EV a more than $4,200 price cut.

The 2022 Nissan Leaf starts at $28,375 and reaches $38,375 for the top trim. Pricing on all models includes a $975 destination charge but does not include government EV tax credits.

The Leaf, which launched more than a decade ago, also receives more standard EV-focused features for model year 2022, including a CHAdeMO Quick Charge port and a portable 240-volt charging cable for every model.

Additionally, eight features previously available in the Technology Packages for the SV PLUS grade, including ProPILOT Assist, will now be standard.

The price reduction sets up Nissan to launch the Ariya in the first half of next year. The new Rogue-sized crossover is built on a new architecture and offers up to 300 miles of driving range.

The two EV models “need to sit together well, you don't wa…

Lyft Inc. on Tuesday posted an adjusted quarterly profit three months ahead of target, seizing on a leaner cost structure as rides rebounded, but it warned of ongoing driver shortages and the spread of the delta coronavirus variant.

The company reported adjusted earnings before interest, taxes, depreciation and amortization for the first time in its nine-year history, and said it would remain profitable on that basis going forward.

Lyft shares initially gained 6 percent in after-hours trading following the announcement but pared gains when executives said during the company's earnings call that revenue per ride was expected to decrease on a sequential quarterly basis. 

The company said ongoing investments in driver incentives and a decrease in prices for riders would pressure revenue in the third quarter.

"The road still remains bumpy given the delta variant and consumer concerns," said PP Foresight analyst Paolo Pescatore.

Lyft on T…

Auto mechanics working at 56 Chicago-area car dealerships went on strike Monday after voting to reject a proposal for a new contract.

The employees in question work at stores that are part of the New Car Dealer Committee of Chicago for 2021, also known as NCDC. They also belong to Local 701, part of the International Association of Machinists and Aerospace Workers trade union.

After months of bargaining between the two organizations, NCDC offered a contract counterproposal Saturday, according to Local 701. The union rejected NCDC's offer during a meeting Sunday. About 97 percent of union members voted to turn it down, and 99 percent voted to begin a strike.

"Withholding labor until fair working terms and conditions are agreed to is a Union member's last resort and the decision was not made lightly," Local 701 said in a news release.

In 2017, a seven-and-a-half-week strike ensued after similar contract negotiation friction between the union and NCD…

Subaru of America is recalling 165,026 vehicles for a potential fuel pump defect that could cause an engine stall while driving, increasing the risk of a crash, the National Highway Traffic Safety Administration said.

There have been no accidents or injuries and Subaru will contact affected customers, according to Jessica Tullman of Subaru product communication.

The recall, issued July 29, includes certain 2019-2020 Ascent, 2018 Forester and 2018-2020 Impreza, Legacy and Outback vehicles. It also covers 2018-2019 BRZ, WRX and Toyota 86 vehicles.

The affected vehicles may have a low-pressure fuel pump that may include an impeller manufactured with a lower density.

Dealers will replace the low-pressure fuel pump in the vehicles free of charge. Owner notification letters are expected to be mailed Sept. 13.

New cars will be required to have technology to detect drunken drivers and a system to keep children from being accidentally left in vehicles on hot days under a series of long-sought safety measures included in the infrastructure bill awaiting a vote in the U.S. Senate.

Other provisions included in the 2,702-page bill are a mandate for automatic emergency braking and crash avoidance systems for new cars, and rear guards for semitrailer trucks to keep the passenger compartments of cars from being crushed in rear-impact collisions.

Jason Levine, executive director of the Center for Auto Safety, which lobbies for more stringent auto safety rules, applauded the inclusion of the measures but said more needs to be done and he hopes the House will beef up the provisions.

“There is little question our nation is long overdue for critical updates to our infrastructure especially when it comes to vehicle safety and the rising tide of preventable car crash deaths,…

As the large dealership software companies continue to gobble up smaller players, independent vendors are taking note of a changing playing field.

Kevin Singerman, CEO of AutoFi, a digital shopping and finance platform, told Automotive News last week that his company's continued sovereignty gives it an edge to pull forward in a market with few players of "any significant size."

"There is nothing wrong with having a great outcome and selling your business," Singerman said. "But we would be leaving so much on the table. Why would we exit right now, when this is finally coming to life?"

This year alone, major analytics firm J.D. Power purchased Darwin Automotive, one of the largest dealership finance software providers; Solera Holdings Inc. acquired dealership software provider DealerSocket; and dealership management system giants CDK Global Inc. and Reynolds and Reynolds Co. also made acquisitions, recently buying digital retailing vendors Roadster and Gub…

DETROIT -- General Motors on Tuesday said its three North American full-size pickup truck assembly plants would be shut down next week due to the global semiconductor chip shortage.

The idling of the plants in Flint, Mich.; Fort Wayne, Ind.; and Silao, Mexico, comes a week after the plants resumed production following an earlier shutdown related to the chip shortage.

"The global semiconductor shortage remains complex and very fluid," GM said in a statement. "The recent scheduling adjustments have been driven by temporary parts shortages caused by semiconductor supply constraints from international markets experiencing COVID-19-related restrictions."

"This period will provide us with the opportunity to complete unfinished vehicles at the impacted assembly plants and ship those units to dealers," GM added.

GM also said its plants in Spring Hill, Tenn., and Ramos Arizpe, Mexico, will resume production on Monday after being idled since July 19.

Shares of Nikola Corp., the pre-production truckmaker whose founder was indicted in federal court last week with misleading investors, fell after the company lowered its initial vehicle delivery projections and warned of nagging supply chain issues.

CEO Mark Russell told analysts on a conference call Tuesday the startup is facing “numerous” delays acquiring parts and CFO Kim Brady said Nikola would deliver as few as half as many vehicles as previously forecast.

Nikola’s shares fell 8.7 percent to close at $10.21 on Tuesday. They have fallen about 33 percent this year.

Investors focused more on the big-rig startup’s update about its path to full production than on its second-quarter loss of $143 million, compared with a loss of $116 million during the same quarter last year. Brady said the Phoenix-based company would deliver just 25 to 50 vehicles this year, down from a previous estimate of 50 to 100 vehicles.

Nikola, which has yet to sell a v…

Grumbling online in Rivian forums is at high volume this summer as the delayed arrival of the company's first consumer product, the Launch Edition R1T electric pickup, grinds on.

The first vehicles were promised late last year. The delivery date has slipped three more times in 2021. If there are no further setbacks, the first R1Ts could be in customers' driveways in about seven weeks. But if that date is missed, I say it's no big deal.

Rivian is doing the right thing by holding off on delivering the R1T electric pickup, while ramping up production and testing of the battery-powered delivery vans it is building for Amazon.

Rivian and Amazon this summer plan to test the vans in 16 cities to ensure that battery packs, electric motors, power electronics and build quality are free of defects. Vans are rolling now in San Francisco, Detroit, Denver and several other cities.

In a recent note to customers, CEO RJ Scaringe cited the chip shortage and linger…

Chevrolet has expanded its electric vehicle lineup with the all-new Bolt EUV, a longer version of the Bolt with more legroom. At the same time, the standard Bolt EV has been updated for 2022. Both are front-wheel-drive only and marketed as crossovers but operate and handle more like hatchbacks, with compact footprints and easy maneuverability. The two vehicles are built on the same architecture but do not share any exterior sheet metal, Chevy said.

The Bolt's chassis and powertrain remain the same but styling and the tech-focused cabin have been freshened for 2022. Safety and connectivity are enhanced as well, along with the quality and styling of the interior.

Most significantly, the Bolt has been reduced in price from $36,500 for the 2021 model to $31,000.

It is equipped with the same electric motor and 65-kWh lithium ion battery pack as before, with a range of 259 miles. The Bolt EUV looks similar to the standard Bolt EV but shar…