Hyundai’s eyeing a factory dedicated to electric vehicles right between its two American factories that aren’t, Ford is proud of itself for making one out of every five F-150 Lightnings affordable and a transmission giant is finding ways to stay relevant in this brave new world. All that and more in The Morning Shift for Monday, May 9, 2022.
We’ve known that Hyundai has been planning an EV manufacturing facility in the U.S. for almost exactly a year, but we didn’t know precisely where. Turns out it reportedly won’t be far from the company’s existing American plants — Kia’s in West Point, Georgia and Hyundai’s in Montgomery, Alabama. Unlike those factories, Reuters says this new one will serve both brands’ electric offerings, from the Ioniq 5 to the EV6.
“We are excited to announce a new EV plant plan in the United States soon, but we do not have details to share at this stage,” Hyundai said in a statement to Reuters when asked about its investment plans.
Hyundai has been in advanced discussions with state officials to build a dedicated EV facility in Georgia, three people with direct knowledge of the talks told Reuters. Details of the investment, including its projected cost and the number of jobs it would be expected to create, were not immediately known.
The new Georgia EV facility, if it is finalized, would serve both Hyundai and Kia as the brands move to roll out a pair of fully electric SUVs – the Ioniq 7 and EV9 – aimed at the U.S. market, the three people with knowledge of the plans told Reuters.
Apparently Hyundai was hoping to make this announcement upon President Joe Biden’s visit to South Korea, but Reuters may have spoiled the moment. Georgia itself is becoming a hotbed for EV and EV-adjacent production; in addition to this rumored Hyundai factory, battery supplier SK opened a new plant in Commerce, Georgia in January — which pushed out a drag strip, it must be said — dedicated mostly to filling orders for Volkswagen. That location will grow to supply Ford in 2023.
Meanwhile, the Montgomery plant will take on manufacturing for the Santa Fe hybrid and Genesis GV70 EV, something Automotive News reported three weeks ago. Those will necessitate a $300 million investment and generate 200 jobs, and the new facility will be part of a larger $7.4 billion allocated for American EV production by 2025.
You know who else is dreaming up a factory in Georgia? Rivian. After celebrating that deal with the state last week, the startup electric truck maker is facing headwinds again — this time thanks to Ford, which has reportedly decided to offload 8 million of its shares in the company following its 180-day post-IPO lockup. From Bloomberg:
Rivian Automotive Inc. sank 17% in U.S. premarket trading after a media report that Ford Motor Co. is selling 8 million of its shares in the electric-pickup maker at a discount.
The U.S. manufacturer owns about 12% of the electric-vehicle hopeful, or just under 102 million shares after taking a stake prior to Rivian going public last year. An insider lockup period expired Sunday after the November share sale that saw the company’s market value briefly top $100 billion making the developer more valuable at the time than Ford and General Motors Co.
Yes, back in November at the time of the manufacturer’s IPO, it was trading at about $180 a share. As of end-of-day Friday, it sat at $28.79. Bloomberg added that JPMorgan Chase is expected to sell somewhere between 13 and 15 million of its own shares at a 6.7 percent discount relative to Friday’s closing price.
Ford is of course not only a shareholder of Rivian but also a competitor, which makes this all very interesting. It’s in the unique position of sharing in its market rival’s success or potentially expediting its failure with a show of waning confidence, as we’re seeing today.
Cue the segue into third gear — this is a very smoothly transitioning Morning Shift for Monday — where Automotive News reports one in every five F-150 Lightnings leaving Ford’s factory is the sub-$40k Pro model, intended for commercial customers. Dearborn hasn’t wasted a moment to pat itself on the back for this, with an executive saying the company could make more money by exclusively concentrating on top-of-the-line pickups for the Lightning’s first run, but instead it’s throwing a bone to the everyman.
While automakers traditionally begin production of new vehicles with only the most expensive variants to maximize margins, Darren Palmer, vice president of electric vehicle programs, told Automotive News that Ford already is churning out plenty of base models aimed at carpenters, plumbers and other business owners. That contrasts with GMC’s decision to launch the Hummer EV with the $112,595 First Edition and with Rivian’s luxurious R1T pickup.
“Fleets we will look after; they are the core of our business,” Palmer said. “Even though we could sell more vehicles, more expensive, it’s not about the short-term profit. We launched with them right at the beginning and we’re giving them 20 percent all through.”
Palmer went on to say that a “really high mix” of retail orders has been for the Lariat trim, which starts a smidge below $70k. Sure, that’s not a $112,000 Hummer, but the two trucks aren’t exactly playing to the same crowd, either. A Lariat is what you’d buy if you wanted a Lightning on a par with a Rivian R1T anyway. Ford can get away with appointing itself the producer of practical EV workhorses for all, because nobody’s really challenging it on that front yet. But let’s be real — one of five doesn’t deserve a standing ovation, either.
If you’re wondering how companies like Aisin will make it when cars don’t need conventional transmissions, well — Aisin is wondering, too. Check this insightful story about a company and an industry in flux, courtesy of Automotive News:
The vexing question facing Aisin — like other legacy powertrain suppliers around the world — is not just how to shift to a new lineup of electrified products, but when to do it.
Shift too soon, and you could be left holding the bag on a lot of premature investment in technology for which the market isn’t ready. Act too late, and suppliers put their very survival at stake.
That delicate balancing act is playing out right now at Aisin, and the outcome is critical not just to Aisin but to Toyota. The automaker is Aisin’s biggest shareholder, with a 25 percent stake, and it relies on Aisin for the bulk of its powertrains. At the same time, Aisin relies on Toyota as its top client.
This situation means that Aisin President Moritaka Yoshida must continue promoting sales of yesterday’s internal combustion products to grow profits. But he must plow the proceeds into potentially risky future products geared around electricity, such as motors and regenerative braking.
Aisin’s certainly not doomed here; it makes plenty of other things aside from slushboxes. It’s the world’s largest supplier of electric water pumps, for example, and produces “e-axles” that combine motors, gears and inverters for forward-looking vehicles like the Toyota Mirai and bZ4X. It’s also courting at least nine other manufacturers that aren’t Toyota for EV-related components, which is a big deal because Toyota is both its biggest customer and part owner. That said, it’s hard not to read quotes like the following from the company’s president without some alarm:
“I need to put this company through a full model change,” Yoshida told Automotive News during a visit to Aisin’s global headquarters here in the suburbs of Nagoya.
“With a healthy sense of crisis, we must take steps forward.”
“A healthy sense of crisis.” That’s a new one and, to be brutally honest, sounds like a perspective my therapist would recommend. To that president of Aisin, I’d say simply, hey — whatever helps you get out of bed in the morning.
The reason is pollution generated from one of the Chinese automaker’s plants. That prompted a government investigation which, in turn, caused the company’s shares to slide on Monday. From Financial Times:
Investors had poured into BYD, backed by Warren Buffett’s Berkshire Hathaway, after blockbuster first-quarter results. But following the announcement of the pollution probe over the weekend, its Shenzhen-listed shares closed down 3.86 per cent on Monday.
On Saturday evening about 100 local residents protested outside BYD’s Changsha factory, a city known for its auto industry in central China’s Hunan province, and accused the company of releasing harmful emissions. City authorities announced an investigation late on Sunday, according to a post on the Communist party committee’s Weibo account.
The residents were from a housing compound within 1km from the factory in Changsha’s Yuhua district. Video clips circulating online showed parents holding pictures of children suffering nosebleeds alongside banners that read: “[BYD] spreads toxins day and night.”
BYD, which also produced face masks during the initial years of the pandemic, denied that its factory was causing the nosebleeds in a statement on social media, but declined to provide further comment, citing the government probe.
The article goes onto say that “locals, including children at a nearby primary school, had suffered nosebleeds, dizziness, nausea and persistent coughs.” Residents have began buying air testing equipment, only to find that “the indoor chemical emission levels were above national standard,” according to one individual who lives near the factory. In response, BYD has apparently “filed police reports alleging the complaints about nosebleeds are groundless and malicious,” per Bloomberg. Real classy carmaker you got there, Warren.
Picture it: It’s May 9, 2004 at the Circuit de Barcelona-Catalunya. Michael Schumacher is well on his way to his seventh Formula 1 Drivers’ Championship in one of the most dominant cars in F1 history, the Ferrari F2004. Its a beautiful day — probably. Then, this happens. Courtesy of 365 Days of Motoring:
During the warm-up lap of the Spanish Grand Prix at Barcelona, a man calling himself Jimmy Jump ran through the starting grid, only to be apprehended soon by the security. While he claimed to have many fans (due to his other performances at football matches), he was criticized for risking the lives of the drivers, even though the cars were still travelling at low speed at this point. The race was won by Michael Schumacher driving a Ferrari F2004.
Jimmy Jump has his own Wikipedia page. Bleacher Report found him four years ago living in Germany, where he recounted his life after he stopped interrupting global sporting events. It’s an incredible read — undercover police were watching his apartment at one point, and he was in over his head in fines. It’s quite depressing, but I’ll leave you with this:
The time he jumped Real Madrid’s former player Cristiano Ronaldo on the night of thunderstorms in the Camp Nou in May 2011 was the one that did for him. He was told he’d be tossed into jail the next time it happened. He was swimming in debt. The fines he owed totalled around €250,000.
He weighed up his options. He needed to clean his slate. A guy in the tax office advised him the best solution was to accept an administrative fine because it is a money-only fine and not considered criminal. That way he’d avoid going to jail. They told him to leave Spain and return after six years. At one stage, he ended up having to pay half his salary to tax authorities. He explained everything to his family and decided to move to Germany. He hit rock bottom.
“Coming to Germany changed my life,” he said. “I was in Germany and I didn’t know what to do. Everything was very difficult. It was a new life. I begged for money. I slept in churches in Berlin. I was having a bad time. I stopped jumping. I passed from being the best pitch invader in the world, a TV star, to being in Germany as an immigrant, working like a robot in a factory, making €1,000 a month. It’s s—t.”
I’ve got a Mazda3 Turbo this week, and you can look forward to my thoughts on it probably next week, or the one after that. Early impressions: It’s weird and I’m not entirely sure who it’s for, but also charming and nicer than it really needs to be. What I hadn’t realized until I got mine in the flesh was that Mazda has grafted a stupid chin onto the front of their handsome hatch that makes the car look like an asshole for no reason. Why would you do this?
Here’s how the normal, well adjusted one looks, for reference:
For the love of god, stop it with the angry cars. Please!