Trade News

MUNICH -- BMW and Volkswagen are among European automakers rebooting their car factories to take advantage of easing coronavirus lockdown rules.

VW restarted production at its home plant in Wolfsburg on Monday, while BMW is cranking up engine manufacturing, also starting Monday.

BMW, VW and Daimler, are banking on Germany's ability to trace and contain the coronavirus, and a healthcare system capable of extensive testing to identify possible carriers of the disease.

Production capacity in the Wolfsburg plant will be at around 10 per cent to 15 percent to begin with, and reach around 40 percent of pre-crisis levels in the week after, said Andreas Tostmann, VW brand's board member responsible for production.

"The restart of Europe's biggest car factory after weeks of standstill is an important symbol for our employees, our dealers, suppliers, the German economy and for Europe," Tostmann said.

VW builds the Golf compact hatchback in Wolfsburg…

Europe's five largest automotive markets edged past China in electric vehicle registrations in the first quarter of 2020, as China battled the outbreak of the coronavirus and imposed shutdowns countrywide, according to a study by PwC and its strategy consulting subsidiary Strategy&.

Germany, France, the UK Italy and Spain collectively registered 79,300 full-electric vehicles between January and March, narrowly edging past the 77,256 in China, the study found.

Unit sales more than doubled in Europe in that period, compared with the first quarter of 2019. In China, sales fell by more than half in the quarter because of the lockdown.

The trend could see a reversal, as sheltering and lockdown requirements are expected to remain in place in most of Europe throughout the spring and restrictions in China are gradually lifted.

More than 80 percent of China's almost 84,000 confirmed coronavirus cases have been in Hubei Province, of which Wuhan is the…

The head of the nation's largest U.S. dealership group says "retail has changed forever" because of the coronavirus and that robust safety processes for AutoNation Inc.'s employees and customers will be necessary.

AutoNation CEO Mike Jackson told shareholders last week that the company has implemented numerous safety measures in its stores from spacing markers for social distancing to hand-washing reminders and bulletins for employees and customers. The auto retailer in recent weeks also implemented a nationwide "store-to-door" vehicle delivery service.

"We've taken significant steps already to ensure the safety of our customers and our employees," Jackson said during AutoNation's virtual annual meeting. "That includes providing masks, gloves, hand sanitizers, single-use pens, sprays, wipes [and] much-heightened level of cleaning throughout the stores, including all the high-touch areas such as keyboards, telephones [and] guest common areas."

AutoNation…

BEIJING -- Prices for Tesla Inc.'s two China-made model 3 variants rose after government authorities cut subsidies in the world's biggest auto market.

China cut subsidies on electric vehicles by 10 percent this year, effective April 23, but there will be a three-month transition period.

After the adjustment, the starting price for the company's Shanghai-made Standard Range Model 3 sedans will rise to 303,550 yuan ($42,900) from 299,050 yuan, while Long Range Model 3 cars, which Tesla plans to roll out starting in June, will be priced at 344,050 yuan versus 339,050 yuan, a company website showed.

Prices for those models before subsidies remain unchanged.

Tesla, which started delivering cars from its $2 billion Shanghai factory last year, saw China registrations rise to 12,709 in March from 2,314 in February.

The subsidies will apply only to passenger cars costing less than 300,000 yuan ($42,376) after the transition period. China will also i…

BEIJING -- Great Wall Motor Co. swung to a net loss in the first quarter after profits dropped 14 percent last year, as the coronavirus epidemic hit the world's biggest auto market.

The Baoding company, which has a joint venture with German luxury automaker BMW, said in a stock exchange filing Friday it reported a 650 million yuan ($92 million) net loss in the first three months of the year, down 184 percent from a 773.3 million yuan profit a year earlier.

Hit by the coronavirus epidemic, China's overall car sales fell 42 percent in the first three months compared with a year earlier. Sales of Great Wall, which is known for its popular SUVs, dropped 47 percent.

Great Wall said the epidemic's impact on auto sales and devaluation of the Russian ruble were the reasons for the profit drop in the first three months this year. Great Wall also builds vehicles in Russia.

It has agreed to buy two assembly plants in India and Thailand from General Motors an…

SAN FRANCISCO -- Tesla Inc. is calling some workers back to its lone U.S. vehicle-assembly plant starting this week, before San Francisco Bay area stay-home orders are scheduled to expire.

Supervisors told some staff in the paint and stamping operations of the factory in Fremont, California, to report to the facility on April 29. In messages seen by Bloomberg News, plant leaders ask workers to reply and say whether they plan to show up.

Tesla representatives didn’t immediately respond to a request for comment.

Tesla had previously communicated to workers that it expected to resume normal production at its U.S. facilities on May 4, the day after Bay area health measures are slated to end. The EV manufacturer clashed with Fremont officials last month over whether its factory was an essential business or otherwise needed to shut down to comply with an Alameda County order issued in mid-March.

The Fremont plant builds every vehicle currently in Tesl…

As automakers and suppliers prepare to restart North American production over the coming weeks, they'll have more to worry about than just how to keep their parts supplies coming and how to keep their factories sanitized.

Among them: When the nation and the world are flying by the seat of their pants trying to deal with a deadly new virus, what is an employer's liability exposure if something goes wrong?

Attorney Chris Reynolds — who also happens to be head of manufacturing for Toyota Motor North America — says the industry as well as other employers are about to discover the answer to that question.

"What is the liability standard for a situation that is unprecedented? We will surely find out," Reynolds said as he laid out plans Thursday, April 23, for Toyota's plants in the United States and Canada to return to limited production beginning May 4.

"Nobody has a good fix on it, if I put my legal hat on. But what our…

CarMax CEO Bill Nash once shared an anecdote he said perfectly illustrated the company's personalized retail strategy. A customer who had had a baby didn't want to trek 60 miles to a CarMax location, so the company delivered a car to her.

Less than a year later, millions of Americans are barred from going to dealerships because of stay-at-home orders during the coronavirus pandemic. And while some traditional dealers have been forced to adopt an arm's-length sales strategy basically overnight, the crisis also led used-vehicle industry leaders such as CarMax and Carvana to tweak their approaches.

CarMax launched contactless curbside pickup at most of its stores that are open nationwide. At press time, about a third of the company's 217 stores were open for curbside pickup and by appointment only, and about 35 were closed for retail operations. Most of CarMax's service departments remain open, deemed an essential service by states.

Nash alluded to…

Marta Hall’s long-simmering frustrations over intellectual property disputes with Chinese rivals reached a breaking point in February.

In a torrent of tweets, the chief marketing officer and former president of Velodyne Lidar Inc. decried the “blatant theft” of the intellectual property behind lidar, the high-tech laser sensors that help self-driving vehicles detect obstacles and perceive the road ahead. She castigated automakers for purchasing knockoffs of this pivotal technology and implored the federal government to better protect U.S. tech companies from patent infringement by international rivals.

“We’ve gone to Washington, D.C., to explain this, but Washington is very busy these days,” Hall told Automotive News. “What do they do about it? What can they do about it? Not much right now. Whereas the  Chinese government has given their companies a lifeline. They fund the Chinese lidar. There’s a lot of money being put into that. It’s almost like the Chi…

TORONTO -- Autoworkers, many of whom are nervous about returning to work, won’t be urged to do so by union leaders until their health and safety concerns have been addressed by manufacturers, Unifor President Jerry Dias said Saturday.

“We’ve taken the position with the Detroit 3 that if our members aren’t comfortable going back to work, then there’s no way we’re going to allow any company to force people back to work,” Dias said. “We’re not giving any green light at all unless our local health and safety people and our committees are 100-percent convinced that everything is OK.”

The Canadian union chief’s comments follow those he made on Thursday, when he said he was “cautiously optimistic” that Canadian auto plants would be able to resume production on the early May timetable put forth by much of the industry. That stood in contrast to a statement by UAW President Rory Gamble, who said it would be “too risky” for workers to go back on the job at that time. Read more

Hertz Global Holdings Inc. could run out of cash as soon as this quarter due to a precipitous decline in revenue and the collapsing used-car market, Moody’s Investors Service warned as it downgraded the rental-car company three steps further into junk.

“The company’s cash burn could exhaust its cash resources during the second quarter,” Moody’s analysts wrote Friday. Hertz probably needs relief from lenders, which may include asset-backed security creditors who fund its rental-car fleet, according to Moody’s, which dropped its rating to Caa3 from B3.

Hertz is seeking advice from restructuring bankers at Moelis & Co. on ways to boost liquidity and avoid filing for Chapter 11 bankruptcy, people familiar with the situation said Thursday. One of the options that’s been under discussion with bankers is raising cash by issuing new debt, Bloomberg News reported earlier. The maneuver would need an amendment to a secured debt facility, the people said, asking not to…

MEXICO CITY -- Volkswagen Group will extend until at least May 18 a suspension on operations at its Puebla production plant in Mexico due to the ongoing coronavirus pandemic, the company said in a statement on Friday.

The German automaker's Silao plant in Mexico is also temporarily down, and the company said it has not yet determined when it might resume operations.

The eventual restart at both plants will be "gradual and under strict hygiene measures," the statement added.

Volkswagen is among manufacturers worldwide who are responding to a steep fall in demand, as well as supply chain challenges following public health measures adopted by governments to rein in the pandemic.