AD #3676 - Stellantis "Outraged" at UAW; Plant Utilization Could Fall; China Forces Germany to Be More Open Minded
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This is Outoline Daily, the show dedicated to enthusiasts of the global automotive industry.
It's day forty of the UAW strike, and it's crazy how fast this thing is moving. Information that is accurate one minute is not the next.
And shortly after recording yesterday's show, the union ordered sixty eight hundred workers at Stalantis's Sterling Heights plant in Michigan to go on strike. The plant, which
builds the RAM fifteen hundred pickup, is one of the companies most profitable, and not surprisingly, Stalantis is not happy, saying it's quote outraged. The
UAW says it's striking the truck plant because Stillanti's quote has the worst proposal on the table. One Wells Fargo analyst estimates that Stillantis will lose one hundred and
ten million dollars in operating earnings per week while the truck plant is shut down, and with it added to the mix, there are now more than forty thousand UAW workers on strike. GM is also feeling the pain and announced it's
dropping its profits and ev production targets for this year because of costs related to the strike. GM released its third quarter earnings and while revenue came in at
over forty four billion dollars, which was up five point four percent. Its
net income was down over seven percent. The company says the UAW strike cost
it two hundred million dollars in Q three, but with additional shutdowns, it's now running at two hundred million dollars a week, and the UAW could easily escalate that more by shutting down profitable plans like Arlington or Flint Truck. Would
that be enough to squeeze an even better deal out of GM. There's no
way to know for sure, but CEO Mary Baris says that the company has been offering record contracts for quote weeks now that don't put jobs or GM at risk, and accepting quote unsustainably high costs is something she will not do.
No doubt UAW President Sean Fain will use these words against GM, since it's also declared a quarterly dividend of nine cents per common share. This is something
Fane views as throwing money at Wall Street, money that should be going to members who helped generate those profits. One of the big things the UAW is
trying to protect against with record contracts is the shift to electrification. There's a
lot more EV models coming and evs need less people to assemble them, and the automaker's upcoming battery plans haven't been organized by the union yet either. However,
there's a number of indications that not enough people in the US want to buy an EV right now, and if that turns out to be true, there's going to be a lot fewer worker shifts at production plans right now.
Car plants in the US are on average, only making sixty six percent of the cars that they're capable of building. Eighty to eighty five percent is considered
the point when most plants start turning a profit. If EV demand doesn't pick
up more and the UAW strike draws out even further, plant utilization could fall even more behind, and one analyst says it could take as much as five years to turn around. Mitsubishi is going to stop making cars in China and
it's transferring its stake in its JV to its partner GAC. While it will
incur a one time loss for restructuring in China, Mitsubishi will save money by not building cars there anymore, and it announced it's investing up to two hundred million euros in Renault's EV division am Peer, which is expected to go public sometime next year. Mitsubishi says the move will help it to improve its EV
development technology and Renault will get more EVA manufacturing scale At Scheffler we Pioneer Motion Electrifying mobility manufacturing smarter, reducing CO two emissions, making energy production clean.
Scheffler Pioneer's Motion to Advance How the World Moves. Tesla revealed that the US
Department of Justice has expanded its investigation into the company. The DOJ had been
looking into its autopilot and full self driving features, but in its recent quarterly report with the Securities in Exchange Commission, Tesla disclosed that the investigation has expanded to include quote personal benefits, related parties, vehicle range, and personnel decisions.
It was also revealed that the DOJ has issued subpoenas for information instead of just requesting it. While the filing didn't provide more details, legal experts speculate
that the DOJ maybe investigating CEO Elon Musk and whether the company has been truthful about vehicle features. Great Wall Motor is the first Chinese EV maker to respond
to the EU's anti subsidy investigation into Chinese made evs. The automaker says it
formally submitted answers to the EU investigators while calling for fair and open trade.
Great Wall says Europe is a strategic market for the company and it also plans to build a plant in the region. But the EU is concerned about the
flood of low cost evs from China, so last month it launched an investigation into Chinese made evs, looking to exclude vehicles with a very carbon intensive energy mix. The EU claims the Chinese automakers are receiving huge state subsidies that keep
prices artificially low, and that could result in tariff being imposed on the evs if the EU concludes that they're hurting the European auto industry. The Inflation Reduction
Act has resulted in a lot of EV investment in the US because companies want to meet requirements to qualify for the EV tax credits, but other regions like Europe, South Korea and Japan were unhappy evs made in their countries one qualify for the subsidies and have lobbied to change the rule. So now The Nickkay
News reports that Japan is seeking more cooperation with the US and Europe over subsidies for electric vehicles, semiconductor chips and other critical materials. Japan wants the sides
to avoid adopting protectionist rules that would harm free trade, so it's proposing a set of standards for subsidies between the three regions and says it wants to start discussions as early as this year. Last week, Stilantis announced it's combining all
of its brands that sell commercial vehicles into one division called Stilantis Pro One, and now it's showing off twelve new van models, including electric and fuel cell from Stroan, fiat Opel, Pougeot, and Vauxhall for the European market.
The electric vans feature the company's new second gen BEV platform. The compact vans
have a range of three hundred and thirty kilometers or two hundred and five miles.
The mid size vans offer fifty or seventy kilowad hour battery packs which provide a range of up to three hundred and fifty kilometers or two hundred and twenty four miles, and the large vans feature a one hundred and ten kilowad hour battery pack that provides four hundred and twenty kilometers or two hundred and sixty one miles of range. As for the fuel cell vans, the mid size ones
have a range of four hundred kilometers or two hundred and forty nine miles and they launch in the middle of next year, while the large fuel sell vans have a range of five hundred kilometers or three hundred and eleven miles and also launch next year. Other features include updated interiors with a new ten inch infotainment
screen, new safety technology, and wireless connectivity. Stillants also revealed that in
North America it will introduce a new Rampromaster EV by the end of the year, the RAM fifteen hundred are EV in late twenty twenty four, and a fuel cell vehicle in the future. German automakers have typically made some of the
most desirable cars in the world, but the chief designer at Portion Volkswagen says because Chinese companies and startups like Tesla can do things completely different, it's forced German automakers to be more open minded. He says this is ultimately a good
thing because it forces the decision makers to also be more open minded, but to truly catch the Chinese and Tasla legacy auto makers are going to have to start moving a whole lot faster. That brings us to the end of today's
show. Thanks for tuning in. Aloline Daily is brought to you by Bridgetone
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