Thousands of VW luxury vehicles were impounded in the US due to forced labor concerns linked to a Chinese component, prompting VW to replace parts and negotiate ending ties with the implicated plant. Stellantis reported strong earnings despite a strike impacting US profit sharing and faces pressure from Italy to increase domestic production. Continental is cutting over 7,000 jobs amid declining ICE sales and EV demand. BorgWarner secured rights to BYD's Blade battery technology and expanded EV component deals in China. GM is expanding its Super Cruise network and planning an electric Corvette by 2028. Ford warns of Chinese automakers entering the US market with low-cost EVs, spurring its own cost-cutting EV projects. The episode also previews a discussion with automotive tech expert Larry Burns.
Topics:vw forced labor impoundmentstellantis earnings and italy productioncontinental layoffsborgwarner byd battery partnershipgm super cruise expansionelectric corvette plansford on chinese ev competitionautomotive technology trendsus auto industry challenges
- U.S. Impounds VW's Luxury Cars - Stellantis Did Really Well in 2023 - Italy Starts Courting Other Automakers - Continental Makes Major Job Cuts - BorgWarner Gets Rights to Build BYD's Blade Battery - GM Nearly Doubles Super Cruise Network - Electric Corvette Sports Car Coming in 2028 - Ford Thinks Chinese Are Prepping to Enter the U.S.
"...is particularly concerned about cars like the BYD Seagull, which has a base price under eleven grand in Chi..."
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Thousands of Porsche, Audi and Bentley vehicles have been impounded by US custom officials because they reportedly have an electronic component that was made with forced labor in China. VW says it's replacing the part and expects to get the vehicles delivered
to customers by the end of March. The Financial Times reports that the component
was made in western China, and it's against US law to import products that were made with forced labor in China's western shing Jiang region. The VW Group,
which those luxury brands are a part of, is under immense pressure to sever ties with a plant that a subsidiary of its joint venture partner operates in the region. As we reported yesterday, VW is in talks with SEIC about
ending its involvement at that plant because forced labor may have been used to build a test track near it. Stillantis reported its full year earnings, and we
think it did really well. It sold six point one million vehicles, up
five point seven percent. Revenues came in at one hundred and eighty nine billion
euros. Up six percent. It posted an operating profit of more than twenty
four billion euros with a twelve point eight percent profit margin, and its net profit was eighteen point six billion. It also generated free cash flow of nearly
thirteen billion euros, which gives the company a substantial war chest Globally. It
handed out nearly two billion euros in profit sharing to employees. UAW workers in
the US will get an average of thirteen thousand, eight hundred and sixty bucks, but that's down from last year's fourteen thousand, seven hundred and sixty dollars.
So why did UAW members get less profit sharing. It's because of the
strike that cut into Stalantas's US profits and cut nine hundred dollars from union members profit sharing checks. The Italian government is butting heads with Stalantis over building more
vehicles in the country. Italy wants Fiat, which is part of the Stalantis
group, to boost production to a million vehicles a year, up from seven hundred and fifty thousand last year, but Stilantis wants more subsidies and incentives to increase that production. Italy has set aside six billion euros to support domestic auto
production next year, and part of that funding is being used to lure another automaker to the country because of its battle with Stalantis. But in our mind
the only real viable options would probably be a Chinese company or Vinfest and many countries in the EU want to keep the Chinese out, but governments are also courting them because they want to bring in more jobs. And here's something you
should expect to see more of. German supplier Continental announced that it's laying off
seven thousand, one hundred and fifty workers to help cut costs. It's acting
seventeen hundred and fifty jobs in research and development, while the rest are administrative positions, and forty percent of the cuts are in Germany. It's also looking
at merging sites in Germany and elsewhere. Last year, the company said it's
looking to save four hundred million euros annually starting in twenty twenty five, and it needs to cut costs because IC sales are dropping. EV demand is slowing
and price cuts are forcing it to be leaner. Borg Warner expects to sell
a lot more EV parts this year by supplying to a lot more Chinese companies.
We think the most important is a partnership with a subsidiary of byd finn Dreams for LFP battery packs. Not only will Borg Warner get the cells to
make the packs, it's also getting the rights to its battery pack design and manufacturing process. Borg hopes to be the go to supplier of LFP packs for
class three and above commercial vehicles in Europe, North and South America, and parts of Asia Pacific. Another deal involves making electric motors for Xpong. The
motors have an operating range up to eight hundred volts and can produce up to three hundred kilowatts or just over four hundred horse power. Xpung will use them
on its X nine minivan and a new B class sedan. Borg's other deals
involve inverters. It formed a joint venture with Shanji Fast Auto Drive Group to
develop a high voltage inverter for the Chinese electric commercial vehicle market, and a deal with an unnamed major Chinese OEM to supply a more power dens inverter for plug in, high ybrid and range extended electric vehicles. For the whole year,
Borg Warner expects to sell twenty five to forty percent more E products than it did in twenty twenty three. In twenty twenty two, GM doubled its
Supercrews network, and now it's nearly doing the same. The last expansion took
it to over four hundred thousand miles of roads where the hands free driving technology works, and now it's going to a total of about seven hundred and fifty thousand miles by the end of next year. Many of the new roads include
minor highways that typically connect smaller cities and townships. The expansion has already started
going out to customers via an Ota update at no additional charge. In speaking
of GM, its first all electric Corvette sports car will likely go into production in twenty twenty eight. Auto four cast Solutions reports that the Corvette Stingray EV
will start rolling down the line at GM's Lansing Grand River plan in February of twenty twenty eight. But it's possible this won't be the first electric corvette.
The Corvette SUV could take that crown. It's supposed to launch next year sometime,
initially with a V eight engine, but it could also go electric.
The head of Ford's EV group warns that Chinese auto makers are preparing to enter the US market and they represent a massive competitive threat. Maren Jaja, the
head of Ford Model E, admits that Chinese auto makers have a technological lead, especially when it comes to electric cars. He predicts that they'll establish assembly
plants in Mexico to gain access to the US market without having to pay a twenty five percent import tariff. Ford is particularly concerned about cars like the BYD
Seagull, which has a base price under eleven grand in China. It estimates
that the BOM or bill of material of all the components needed to make the car is only eight thousand dollars, and that's exactly why Ford launched a top secret skunk works program to develop an electric car that significantly slashes costs. Maren
ja Ja says the US auto industry better get fit now or it doesn't have a future. He created the first ev skateboard, pushed the development of hydrogen
fuel cells, and was one of the pioneers of autonomous technology. So what's
he up to now. Larry Burns is the former head of R and D
at General Motors and is a fountain of information on the future of automotive technology.
He's also our guest on Auto Line after Ours today, and we invite you to sit in to hear what he has to say. Frank Marcus from
Motor Trend will also be on the show, so join John and Gary to learn about the latest tech trends in the automotive industry. But that brings us
to the end of today's show. Thanks for tuning in. Auto Line Daily
is brought to you by Bridgestone Solutions for your journey and by Intrepid Control Systems over the air engineering boost your game. We want to know what drives your
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