China to cut subsidies on EVs by 20% in 2021

BEIJING -- China will subsidies by a fifth next year on new energy vehicles such as electric cars, the finance ministry said on Thursday, as it seeks to combat pollution and cultivate home-grown champions in the auto sector.

China, the world's biggest auto market, has set a target for NEVs, including plug-in hybrids and hydrogen fuel cell vehicles, to make up 20 percent of auto sales by 2025, up from 5 percent now.

China’s EV market dwarfs that of other countries and the government is intent on further expansion amid commitments to reduce fossil-fuel use.

Global automakers such as Volkswagen Group, General Motors, Toyota Motor Corp. and Tesla Inc. are ramping up EV production in China. The are facing competition from domestic automakers, notably Nio, Xpeng and Li Auto.

Subsidies will be reduced by 10 percent on NEVs for public transport, including buses and taxis, the ministry added in a statement on its website.

China w…

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Ford New Year’s Day ad promotes mask-wearing

Ford Motor Co. has called an audible on its New Year’s Day college football marketing in a move to promote mask-wearing. The automaker will dedicate a significant portion of its media buy during Jan. 1 bowl games to a new ad called “Finish Strong,” which promotes mask-wearing and other safety measures, while foreshadowing better days ahead as vaccines distribution ramps up.

The spot is narrated by Ford spokesman Bryan Cranston and was created by filmmaker Peter Berg. It will air during the Citrus Bowl on ABC and the Peach Bowl, Rose Bowl and Sugar Bowl on ESPN, as well as during Fox NFL games on Jan. 3. Ford had originally intended to use its airtime during the high-profile sporting events to plug vehicles, including its top-selling F-150 pickup truck. But the automaker opted to use half of its buys for “Finish Strong.”

“We’re in this together and Ford’s goal since the pandemic started has been to try to help save lives,” Kumar Galhotra, Ford’s president …

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CarMax to spread the word about omnichannel

CarMax's long-stated goal has been to give customers the chance to transact when, where and how they want to — whether in the physical or digital realms or in both — a concept known as omnichannel retailing.

The nation's largest used-vehicle retailer has now transformed every aspect of its business to fulfill this goal, and it will let the masses know about it through a multimillion-dollar marketing push set for 2021, CEO Bill Nash said.

"We want customers to understand that CarMax offers the ultimate flexibility to shop and buy on their terms, their way," Nash said last month after the retailer reported higher earnings for its fiscal third quarter.

CarMax was set to launch the first ads in its multimedia marketing campaign in late December. The pitch, Nash said, is to highlight the differences between the sales platform offered by CarMax and the approach taken by traditional dealerships and online competitors.

The new campaign will run across …

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Kia brings a fresh team to lead 2021 push

LOS ANGELES — Kia Motors America has big plans for the coming new year, including five new or significantly redesigned vehicles as part of a yearslong product blitz. It also has a new COO and advertising lead to get those vehicles onto Americans' driveways.

In mid-December, the Korean automaker began preparations for the next phase of its product push by naming the new team to deliver it .

Bill Peffer was promoted to COO and executive vice president after serving as vice president of sales operations since July 2017.

Peffer, 50, is essentially taking over the role of Michael Cole, Kia's former president, who left in June to become CEO of Hyundai Europe. At the time of Cole's move, Kia said the president's post would be assumed by Sean Yoon, CEO of Kia Motors America and Kia Motors North America.

"This promotion is well deserved," Yoon said in a statement about Peffer's new role, "and with five all-new and significantly redesigned vehicles slated…

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UK automakers seek Brexit phase-in period to avoid border mess

UK carmakers offered faint praise for the country’s Brexit deal while warning border chaos will be unavoidable unless governments allow more time to meet new customs-related administrative requirements.

The accord reached last week with the European Union largely addresses the auto industry’s immediate concerns about tariffs, the Society of Motor Manufacturers and Traders said Wednesday. Still, the trade group said the agreement fails to deliver on key demands including regulatory cooperation and customs procedures.

“With no detail or time frame for implementing reform, immediate costs and friction are inevitable,” Mike Hawes, CEO of the trade group, said in a statement calling for a phase-in period that allows businesses to adapt. “Suppliers and manufacturers on both sides will face a significant administrative challenge that will undermine productivity and increase operating costs.”

The SMMT’s request echoes other business groups’ calls for a grac…

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DAILY DRIVE PODCAST: December 30, 2020 | 2020 in review: The Israeli factor 

Join Automotive News Publisher Jason Stein for a daily podcast series about the coronavirus crisis. He’ll speak with industry experts, insiders and Automotive News reporters about how the virus is impacting and reshaping the automotive industry.

Why is Israel a hotbed for automotive innovation? And what are some of the latest technologies being developed in the country? Daily Drive guests answer those questions and more in this special edition.

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Key F&I trends of 2020

The year 2020 altered the auto retail landscape in numerous ways. Dealers incorporated more financing steps in digital processes and dealership employees creatively navigated supply constraints. According to some of the nation's largest finance and insurance providers and administrators, 2020 is a year unlikely to be forgotten, one which galvanized change to the finance process. Here are a few notable trends that emerged over the past 12 months:

"Omnichannel" exploded: Digital retailing processes were by no means a byproduct of the coronavirus pandemic, though the adoption of these tools and processes by retailers this year certainly accelerated.

"We don't even know where the endzone is yet. Over the course of the last 10 months, technology has actually increased the business managers' value. You need somebody who can be versed front to back in a conversation with the consumer. We don't know yet what step of the process they're in [online]. Yo…

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COVID-19 dominates most-clicked 2020 stories

The coronavirus dominated the news cycle this year, roiling the U.S. auto industry and driving millions of Americans out of offices and into their homes.

Businesses big and small — including automotive retailers, suppliers and manufacturers — laid off thousands of workers as customer traffic dried up and manufacturing operations came to a temporary halt.

These disruptions galvanized the auto retail industry, prompting innovation, collaboration and widespread digital adoption, financial assistance and technical support.

Here were the top F&I stories of 2020:

GM launches broad plan to combat coronavirus impact: General Motors in March forged a comprehensive plan to mitigate business losses caused by the pandemic. The program included aggressive incentives for new-vehicles, 0 percent interest, 84-month loans and deferred payments of up to 120 days to customers in top credit tiers and free OnStar crisis-assist services…

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Brexit deal may be too little, too late for UK auto industry

The auto industry dodged disaster when the UK and the European Union sealed a post-Brexit trade accord, but not before automakers announced factory closures and called off plans to make several new vehicles in the country.

More damage may still be done even with last week’s deal. Automakers including Nissan might struggle to qualify some UK-assembled models for tariff-free export to the EU as they evaluate whether they source enough of their components locally.

Costs associated with having to switch suppliers and the burdens of customs declarations, certifications and audits could still leave car companies convinced that they are better off investing elsewhere.

“This is still a thin deal with major implications and costs for automotive,” said David Bailey, a business economics professor at Birmingham Business School. “Much will depend on the degree of flexibility allowed and the degree of phasing in.”

The stakes for the UK economy are huge. The c…

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Tesla’s dominant EV position in China could be threatened in 2021

Tesla Inc. is coming to the end of its first year selling China-made cars with a commanding position in the world’s biggest EV market, but Elon Musk shouldn’t rest on his laurels.

While Tesla regularly topped monthly premium EV sales tallies this year, helped by the sedans churned out from its multibillion-dollar plant opened to much fanfare in Shanghai last December, 2020 was also marked by rivals catching up. In 2021, the breadth of the competitive attack that Tesla faces will be greater than ever.

Whether Tesla can defend its lead in China will be key to its wider growth and earnings trajectory. While still in its infancy, China’s EV market dwarfs that of other countries and the government is intent on further expansion amid commitments to reduce fossil-fuel use. Tesla’s fate in China will also show whether it can grow into a truly global carmaker, an ambition investors are banking on after pushing the company’s shares up almost 700 percent this year.<…

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Tesla reaches five-year lithium deal with Chinese supplier

China's Sichuan Yahua Industrial Group Co. said on Tuesday it had signed a deal to supply battery-grade lithium hydroxide to Tesla Inc. for the next five years.

Yahua, which is based in southwest China's Sichuan province, did not provide tonnage figures but, in a filing to the Shenzhen Stock Exchange, put the total value of the contract at $630 million to $880 million over 2021-25.

Tesla, which started delivering the first vehicles from its plant in Shanghai in December last year, already sources lithium -- a key ingredient in EV batteries -- from China's Ganfeng Lithium, one of the world's biggest producers of the commodity.

Tesla did not immediately respond to a request for comment on Tuesday.

In May, Yahua put a 20,000 tons per year lithium hydroxide plant into operation, more than doubling its previous capacity, even as prices languished at multi-year lows amid oversupply and a knock to lithium demand brought about by the coronavirus pandemic.

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DAILY DRIVE PODCAST: December 29, 2020 | 2020 in review: Suppliers hanging in the balance

Join Automotive News Publisher Jason Stein for a daily podcast series about the coronavirus crisis. He’ll speak with industry experts, insiders and Automotive News reporters about how the virus is impacting and reshaping the automotive industry.

As suppliers continue to cope with challenges around the pandemic, Daily Drive guests provided a sobering perspective on what's ahead for suppliers and why the supply chain could become decentralized. 

How do I subscribe?

Can't wait to hear the next episode of "Weekend Drive"? Subscribe through a podcast app to receive episodes days in advance. If you don't have a podcast app already, here are some options. 

iPhone / iPad

“Weekend Drive” is available on the iTunes Store and through the ‘Podcast’ app pre-installed on all iOS devices. Click here to subscribe to "Weekend Drive"

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