Automakers face ongoing challenges with declining sales and profits, highlighted by Mercedes Benz's earnings drop and GM's costly halt of its Origin robotaxi due to regulatory hurdles. GM may close excess plants in China amid falling sales but remains committed to the market. Stellantis plans production cuts and may drop underperforming brands. Chevy unveiled the powerful new Corvette ZR1 with over 1,000 horsepower. China boosts subsidies for scrapping old vehicles to promote cleaner alternatives. Meanwhile, Chinese EV makers are establishing European plants to bypass tariffs, and JD Power finds non-Tesla EVs now lead in owner satisfaction.
Topics:gm china plant closuresorigin robotaxi cancellationmercedes benz earnings declinestellantis brand strategychevy corvette zr1 revealchina vehicle subsidieschinese evs in europejd power ev satisfactiontesla charging warning
- Mercedes’ Q2 Earnings Drop - GM Takes $600 Million Hit from Cruise Origin - GM Could Start Closing Plants in China - Stellantis To Cut Production and Prices in North America - Tavares Warns Stellantis Could Drop Brands - Chevy Reveals All-New Corvette ZR1 - China Boosts “Cash for Clunkers” Incentives - More Chinese OEMs Set Up Shop in Europe - Legacy Automaker EVs Outperform Tesla in J.D. Power Study - Tesla Warns Against Wet Towel Charging Trick
"... vehicles in China, like suburbans and Speaker 2: corvettes that are imported from the US. As we reported yes..."
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Speaker 1: This is Outline Daily.
Speaker 2: The show dedicated to enthusiasts of the global automotive industry.
Speaker 2: As they put COVID in the chip shortage behind them.
Speaker 2: Automakers thought that twenty twenty four would be the year Speaker 2: when things sort of got back to normal, but it's Speaker 2: not turning out that way. Earlier this week, Testa reported
Speaker 2: a disastrous quarter. Yesterday we reported that Stilantis, Renault, Nissan,
Speaker 2: and Ford had sharp drops in earnings, and today we Speaker 2: can add Mercedes Benz to the list. It sold just
Speaker 2: over six hundred thousand cars and vans in the last Speaker 2: three months, down five and a half percent from last year.
Speaker 2: Revenue dropped four percent to thirty seven billion euros, and Speaker 2: its operating profit plummeted nineteen percent to four billion euros.
Speaker 2: While Mercedes Benz vans delivered a higher profit, its passenger cars, Speaker 2: including electrics and pehabs were down. Mercedes also blames a
Speaker 2: situation in China for the drop in its earnings. Earlier
Speaker 2: this week, we reported that GM is giving up on Speaker 2: its cruise robotaxi called the Origin. What most people don't
Speaker 2: know is that vehicle was already fully tooled up and Speaker 2: GM actually built dozens and dozens of them walking away Speaker 2: from that investment was costly. GM had to take a
Speaker 2: six hundred million dollar charge just to write it off.
Speaker 2: GM CEO Mary Barra blamed regulatory uncertainty. Since the Origin
Speaker 2: doesn't have a steering wheel or other safety components like Speaker 2: turn signal stocks, it doesn't meet FMVSS regulations or federal Speaker 2: motor vehicle safety standards. She says GM needs a legislative
Speaker 2: change before the Origin can be legal. We wonder if Teslo,
Speaker 2: Weimo or Zeukes believe that their robotaxis are illegal, but Speaker 2: we're willing to bet they do not. By the way,
Speaker 2: we want to thank Autoline Daily viewer Nick Thomas for Speaker 2: sending us these pictures of Origins parked outside of a Speaker 2: GM facility. And speaking of GM, is it going to
Speaker 2: have to start closing plants in China? In twenty seventeen,
Speaker 2: GM sold four million vehicles. Last year that was two
Speaker 2: point one million, and this year sales continue to drop Speaker 2: in China. We figure GM has at least four assembly
Speaker 2: plants too many in China. Mary Bara is reluctant to
Speaker 2: say what they will do because those plants are joint Speaker 2: ventures with SAIC, which is a state owned car company, Speaker 2: and with China's economy sputtering right now, it would be Speaker 2: highly embarrassing to the government if GM and SAIC started Speaker 2: announcing plant closings. But one thing's for sure, GM has
Speaker 2: no intention of abandoning the Chinese market. Barra points out
Speaker 2: that it's a significant export hub for GM to other Speaker 2: markets in South America and Central Asia, and she sees Speaker 2: a lot of opportunity with its Durant Guild retail brand Speaker 2: that sells high end vehicles in China, like suburbans and Speaker 2: corvettes that are imported from the US. As we reported yesterday,
Speaker 2: Stillantis had a rough first half of the year, with Speaker 2: a ten percent drop in sales and a forty percent Speaker 2: decrease in operating profit, and most of the losses came Speaker 2: from North America, which had been the most profitable part Speaker 2: of the company. So Stillanti says it will cut production
Speaker 2: in North America this quarter to get more in line Speaker 2: with demand, and it will also cut vehicle prices. It's
Speaker 2: planning five hundred million euros in savings across all of Speaker 2: its operations in the second half of the year, and Speaker 2: if some of its fourteen brands don't start performing better, Speaker 2: Stillanti's CEO, Carlos Tavares, says it's ready to start dumping them.
Speaker 2: During the company's first half earnings call, Tavarres said, quote, Speaker 2: if they don't make money, we'll shut them down. We
Speaker 2: cannot afford brands that do not make money. We think
Speaker 2: Chrysler and Maserati are two obvious choices to get rid of.
Speaker 1: Since their sales are so small.
Speaker 2: But what do you think what brands do you think Speaker 2: are on the chopping block?
Speaker 3: Trusting tires designed for the long haul, because you'll always Speaker 3: go the distance for friends. That's what really matters. Breached
Speaker 3: down a lens of tires with an eighty thousand mile Speaker 3: unted warranty.
Speaker 2: A split window Corvette is back for the first time Speaker 2: since nineteen sixty three. Chevy revealed the all new ZER
Speaker 2: one version of the VET, which it claims has the Speaker 2: most powerful V eight ever produced in America by an automaker.
Speaker 2: That engine is a twin turbo version of the five Speaker 2: and a half lead flat plane crank V eight found Speaker 2: in the Z six, but instead of producing six hundred Speaker 2: and seventy horse power, it generates over one thousand and Speaker 2: fifty horse power and nearly eight hundred and thirty pound Speaker 2: feet of torque. It dubbed it the LT seven and
Speaker 2: made changes to the heads, valve, train, intake system, cooling, Speaker 2: and more to make and handle all that extra power.
Speaker 2: The ZR one's eight speed dual clutch trans and braking Speaker 2: system also had to.
Speaker 1: Go through upgrades.
Speaker 2: In fact, the fifteen point seven inch carbon ceramic rotors Speaker 2: are the largest front brakes ever put on a corvette.
Speaker 2: Magnetic ride control dampers and a host of aero dynamic Speaker 2: improvements are standard as well on the ZR one, But Speaker 2: for those that want a little bit more, there's the Speaker 2: ZTK package. It adds more aggressive arrow including a big
Speaker 2: rear wing and underbody panels, different suspension tuning that comes Speaker 2: with stiffer springs and Michelin performance tires. Chevy claims the
Speaker 2: ZR one will do over two hundred and fifteen miles Speaker 2: an hour, which is three hundred and forty six kilometers Speaker 2: an hour, and it will run the quarter mile in Speaker 2: under ten seconds. It will be built in Kentucky and
Speaker 2: production starts sometime next year. China wants to get old,
Speaker 2: less environmentally friendly vehicles off of its roads, so it's Speaker 2: boosting subsidies for a cash for clunkers like program. Car
Speaker 2: buyers who scrap their old car for a new energy Speaker 2: vehicle now get a twenty eight hundred dollars incentive, double Speaker 2: what it was before. Subsidies for buying a new ice
Speaker 2: vehicle are now twenty one hundred bucks also double, and Speaker 2: there's incentives to upgrade old commercial vehicles, agricultural equipment.
Speaker 1: And buses as well.
Speaker 2: The vehicle incentives are part of a larger forty one Speaker 2: billion dollar program to upgrade large scale industrial equipment and Speaker 2: other consumer products in China. More and more Chinese automakers
Speaker 2: are setting up shop in Europe to avoid tariffs.
Speaker 1: On imported evs.
Speaker 2: The EU is trying to prevent a wave of cheap Speaker 2: Chinese evs from flooding the market and hurting European brands.
Speaker 2: But while they don't want imported evs, several European countries Speaker 2: are luring Chinese EV makers to build vehicles there. Cherry
Speaker 2: will soon start operations in Spain, Leap Motor is assembling Speaker 2: vehicles at a Stalantis plant in Poland, Buid is planning Speaker 2: factories in Hungary and Turkey, and Seic and Zeker are Speaker 2: also looking for production locations in Europe. This will allow
Speaker 2: them to avoid the import tariff on Chinese evs, which Speaker 2: is up to forty eight percent. EV's from legacy automakers
Speaker 2: outperformed Tesla. According to JD Power's Appeal study. It ranks
Speaker 2: owner satisfaction of new vehicle design and performance based on Speaker 2: a one thousand point scale, and this year, non Tesla Speaker 2: evs had a satisfaction rating of eight hundred and seventy seven, Speaker 2: which is an all time high and also beat Tesla's Speaker 2: score of eight hundred and seventy. And if Rivian had
Speaker 2: met JD Power's criteria for the study, it would have Speaker 2: come out on top of everybody else, no matter the Speaker 2: powertrain type, with a score of nine hundred. The average
Speaker 2: score for a luxury vehicle regardless of powertrain was eight Speaker 2: hundred and seventy, and it was eight hundred and thirty Speaker 2: eight for mass market cars. JD Power says improved battery
Speaker 2: range and better interiors is why other automakers passed up Tesla.
Speaker 2: But speaking of Tesla, it says if you're using a Speaker 2: wet rag on the charging cable to speed up the Speaker 2: charging rate, to stop doing it. It has nothing to
Speaker 2: do with water getting between the plug and connector rather, Speaker 2: it says, it can interfere with the temperature monitoring system, Speaker 2: increasing the risk of overheating and damage, and it can Speaker 2: make it harder for the system to determine if there's Speaker 2: actually a problem with the charging.
Speaker 1: That brings us to the end of this show and Speaker 1: this week.
Speaker 2: Thanks for tuning in, and I hope that you have Speaker 2: a great weekend.
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