Trade News

Subaru of Indiana Automotive is joining the growing ranks of automakers putting hourly plant employees on furlough due to the COVID-19 outbreak.

The Japanese automaker's only North America factory was initially idled on March 23. The shutdown was later extended until April 6 and again until April 20.

The company said the one-week furlough will begin Monday.

"While Subaru of Indiana Automotive was pleased to provide full pay for three weeks, next week will be unpaid for our hourly associates," a plant spokesman said via email. "The situation was no longer sustainable while production remains suspended amid health concerns, declining market demand and supply chain issues."

Plant employees, including temporary production employees with at least 90 days of service, are receiving full pay through April 10.

Subaru said health insurance and all other benefits will be retained. Hourly employees will qualify for unemployment benefits beginning on Ap…

The shelter-at-home orders and other government restrictions that have brought North American light-vehicle output to a halt are forcing a delay in the debut of one of the U.S. auto industry's newest upstarts.

Electric truck maker Rivian is pushing back plans to launch sales of a pickup and SUV assembled at a resurrected Mitsubishi plant in Normal, Ill.

The company planned to begin deliveries in late 2020 and now says customer shipments will begin in 2021.

"The world has changed a lot in these last few weeks," the company said in a letter April 1 to customers. "This evolving new reality is not without impact on our program timing. While we expect some level of delay, we are working to minimize the disruption to our launch schedule."

Rivian spokeswoman Amy Mast said the company can't provide more guidance on the sales launch beyond the 2021 window.

The delay was first reported by The Chicago Tribune.

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Michigan Gov. Gretchen Whitmer on Thursday extended her stay-at-home order to combat the spread of the coronavirus to April 30, emphasizing that the deadly threat of the virus to public health has not subsided enough to resume normal activity in the home state of the U.S. auto industry.

The governor's executive order "prohibits all businesses and operations from requiring workers to leave their homes, unless those workers are necessary to sustain or protect life or to conduct minimum basic operations."

A lifting of the the order on April 30 could pave the way for auto production to resume in the state on May 4 – Fiat Chrysler's target date for the reopening of some plants.

On the retail front, the extension included a key change: Employees engaged in online vehicle sales and deliveries have been added to the list of "critical infrastructure workers":

"Workers at motor vehicle dealerships who are necessary to facilitate remote and electronic sales …

Volkswagen of America said Thursday it will furlough production and maintenance workers at the automaker's assembly complex in Chattanooga, less than nine months after workers there narrowly defeated a second effort to unionize under the UAW.

The plant, idled because of government restrictions to help stem the coronavirus outbreak, employs 3,800 hourly and salaried workers.

The automaker said the "emergency furloughs" would go into effect Saturday, and are "expected to last no more than four weeks. During this time, the company will continue to provide health care benefits and coverage of premiums, paying both employer and employee contributions. Employees will still receive their first quarter bonuses as well as their March monthly bonuses."

Furloughed employees are eligible to receive state unemployment benefits as well as an extra $600 per week in federal compensation under the $2 trillion CARES Act passed last month. Volkswage…

Ford Mobility subsidiaries aid transit agencies during COVID-19

As the nation hunkers down to help slow the spread of COVID-19, cities are experiencing a decrease in traffic congestion and in some cases a decline in public transit use.

But people – especially critical personnel for essential industries – still need to get around, leaving transit agencies in major metropolitan areas to manage an unprecedented and sudden shift in operations.

Ridership and demand for services have fallen on some routes but increased on others.

Major transit systems also have been facing challenges with cleaning, staffing and other issues.

To help transit agencies respond to today's evolving rider demand and other challenges, Ford Mobility subsidiaries TransLoc, Ride Systems and DoubleMap are offering free consulting and rider demand response software. Transloc is a software provider for transit agencies. Ride Systems and DoubleMap provide automatic veh…

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Car-sharing service Zipcar expanded its Dedicated Zipcar vehicle program in response to demands brought on by the COVID-19 pandemic.

The program grew this week in the 10 cities it already serves and launched in 14 cities.

"The coronavirus crisis has created new needs for our members, especially essential employees, who rely on our convenient on-demand vehicles in urban locations," Justin Holmes, Zipcar vice president of marketing and public policy, said in a statement to Automotive News.

Standard Zipcar services allow users to book a vehicle by the hour or day. Dedicated Zipcar provides Zipcar members exclusive access to keep the same vehicle Monday through Friday.

Dedicated Zipcar rates vary by city and include a monthly membership fee, based on market and class of vehicle, plus a $0.45-per-mile fee. The monthly membership fee ranges from $199 to $349, according to Zipcar. A parking spot, gas and insurance are included.

The expanded servic…

PARIS -- Renault's board has decided to cancel its dividend on 2019 earnings in light of the coronavirus crisis, a source close to the matter told Reuters on Thursday.

Renault Chairman Jean-Dominique Senard and interim CEO Clotilde Delbos will cut their compensation by 25 percent in the first quarter and will do same in the second quarter if the coronavirus crisis continues, the source also said.

Several automotive companies such as Michelin and Ford have already decided to reduce or suspend dividends on 2019 earnings to preserve cash in the current crisis.

Renault, which is 15 percent state-owned, had earlier proposed to pay a 1.1 euro per share dividend that had already been cut by two-thirds from the 3.55 euro per share payout on 2018 earnings.

PARIS -- Working groups at Fiat Chrysler Automobiles and Peugeot's owner PSA are speeding up work on closing their merger deal despite the coronavirus crisis, PSA CEO Carlos Tavares said in an internal note seen by Reuters.

Tavares also said in the note the working groups were also speeding up work on synergies.

The crisis triggered by the new coronavirus has virtually wiped out demand for new vehicles in Europe and North America, pushing automakers to temporarily halt most production and leaving them needing cash.

Sales continued to slump in March at two major Chinese automakers, Geely Automobile Holdings and BYD Co., with vehicle demand subdued by the lingering coronavirus outbreak.  

Deliveries at Geely, the largest domestic Chinese carmaker, fell 41 percent to 73,021 last month, the company said. 

Crossovers, sedans and multipurpose vehicles accounted for 66 percent (48,414), 32 percent (23,593) and 1.4 percent (1,014) of Geely’s March sales, respectively, the company reported.

Geely’s first-quarter deliveries totaled 206,027, a decline of 44 percent from the same period last year.

Despite the huge impact from the viral outbreak, Geely is targeting sales to increase 3.5 percent to 1.41 million in 2020, CEO An Conghui said in late March when the company released 2019 financial results.

March sales at BYD, China’s largest electrified-vehicle maker, dropped 35 percent to 30,599 last month. The tally includes 12,256 electric vehicles and plu…

CarMax is furloughing about15,500 employees, effective April 18, while also slashing executive pay and other costs.

The cutbacks come as about half the company's 217 U.S. stores are ether closed or operating on a limited basis due to the coronavirus outbreak, and "consumer demand has progressively deteriorated in recent weeks," the retailer said in a statement Wednesday.

Affected employees are being given transition pay prior to the start of their furlough. They are not being paid by CarMax after their furlough date, a company spokesperson said in an email. CarMax said it will cover all affected employees' costs under the company's medical plan until further notice.

"This has been a very difficult decision," CEO Bill Nash said in a statement. "Each and every one of our associates are incredibly important to us. We will not rest until we can start pulling our team back together. I believe that these steps will help our company with…

Here For America, a coalition representing the U.S. operations of international automakers and original equipment suppliers, has named policy veteran Jennifer Safavian its first CEO, effectively immediately.

Safavian previously was executive vice president for government affairs at the Retail Industry Leaders Association. Before that, she spent nearly 20 years on Capitol Hill, where she held senior positions such as staff director and general counsel to the House Ways and Means Committee.

"Jennifer's strong bipartisan relationships and proven track record navigating complex trade and tax policy issues makes her an outstanding choice to lead this new organization," Here For America Chairman Brian Krinock said in a statement Wednesday.

"During these unprecedented times for our industry, we are confident she will advance our members' goals to foster an open and competitive automotive marketplace."

Here For America was created by the Association of Gl…