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In case you missed it, the summer has been hot for auto news – Automotive News

by Oct 21, 2022Blog0 comments

In case you missed it, the dog days of summer have been anything but for the auto industry.
Automakers, suppliers and retailers have been slogging to untangle themselves from supply chain crises precipitated by COVID shutdowns in Asia and war in Europe. New-vehicle sales slumped in the first half of the year as automakers struggled to keep assembly lines running and dealer lots supplied.
Rising inflation now threatens future sales and profitability for carmakers and their retailers. And more instability lies ahead as new legislation driving EV adoption in the U.S. upends the EV manufacturing plans of global automakers and supply chain sourcing. Meanwhile, electrification plans rapidly unfold as automakers pivot from combustion engines to batteries.
Here’s a quick recap of the big stories from summer 2022.
President Joe Biden signed the Inflation Reduction Act into law in late August, designed to incentivize domestic EV production and reduce reliance on foreign supply chains.
The legislation, which alters the eligibility requirements of a long-standing $7,500 EV tax credit, has the auto industry scrambling to reshape complex production plans and supply chains to meet stringent sourcing rules.
To qualify for the federal incentive, automakers must now assemble EVs in North America. New restrictions on sticker price, buyer income, and battery component and critical mineral sourcing take effect Jan. 1.
Only about 20 EVs qualify for subsidies under the new rules, among them models from Ford and BMW and, starting next year, GM and Tesla.
The new law has caught the industry off-guard, including South Korea-based Hyundai Motor Group, which previously announced more than $10 billion in U.S. investments, including a $5.5 billion EV plant in Georgia.
Reuters reported South Korean officials have met with U.S. counterparts to express concerns, and the Financial Times reported Hyundai Motor Group Chairman Euisun Chung also headed to Washington.
“Our U.S. EV factory plan was to get subsidies in light of the growing EV market in the United States,” a company official told Reuters. “The new law negatively and directly affects us.”
Seoul has asked Washington to postpone the new rules until the completion of its Georgia factory in 2025 and noted the new law might violate treaties such as the U.S.-South Korea free trade agreement.
At the North American International Detroit Auto Show this month, Ford Motor Co. will reveal a redesigned, seventh-generation Mustang.
Code-named S650, the car is expected to begin production in the first half of next year. It should feature a carryover V-8 and four-cylinder EcoBoost engines.
A hybrid variant planned for mid-decade is now scrapped and the car isn’t expected to get a long-rumored all-wheel-drive configuration, instead continuing as a rear-wheel-drive sports coupe.
Ford considers Mustang one of its hit “icons” and has added several variants throughout the current vehicle’s life cycle, including the Shelby GT500 and Mach 1.
The Japanese automaker is taking the scalpel to its U.S. lineup as it focuses on higher-volume crossovers and revamps its portfolio for an electric future.
Production of the Rogue Sport will end in December. The crossover has failed to find its niche between the entry-level Kicks subcompact crossover and the higher-volume Rogue.
Nissan will ditch its full-size Maxima sedan next year. And Titan — the company’s attempt to take a sustainable share of the full-size pickup segment — will be discontinued before mid-decade.
Looking beyond, Nissan should bring an electric sedan in 2025. The automaker will invest $500 million in its Canton, Miss., factory to build that vehicle and other EVs.
The Leaf — which pioneered the EV segment with its launch in the U.S. in late 2010 — will be replaced with a new coupe-like electric crossover by mid-decade.
Further out, Nissan is said to be considering an electric pickup for the U.S. Last November, Nissan showed off a battery-powered pickup concept.
Inflation and higher interest rates are affecting the used-vehicle business plans and profits of auto retailers.
Faced with rising costs, consumers are tightening their purse strings, with many skipping new-car purchases for budget-priced used vehicles.
Getting more of those vehicles onto dealer lots is proving difficult, which contributed to a softer-than-expected first half in the used-vehicle business for traditional dealership groups and online used-only retailers.
Public dealer groups saw per-vehicle profits on used cars tumble sharply this past spring, with some groups pulling back on growth goals for their used-only ventures. Online used-only retailers have scrambled this year to slash costs because the vehicle-buying activity of consumers hasn’t matched last year’s fierce levels — leading to plunging per-vehicle profits and more profound net losses across the board.
“We’re seeing demand shift to lower price points,” Group 1 Automotive CEO Earl Hesterberg said in July. That shift is happening most prominently among middle-class consumers and those buying mass-market brand and used vehicles, Hesterberg said.
Asbury Automotive Group CEO David Hult said consumers who were “impulsively buying” six months ago are now being more deliberate in their selection.
“Of all the segments, I would say [used is] the one where it’s trying to find its footing to move forward,” Hult said in July. Still, he viewed Asbury’s used business healthy in the second quarter.
Online auction company ACV Auctions Inc. filed an antitrust lawsuit late last month against several major players in the physical auction sector, alleging they conspired to hinder ACV’s ability to compete in the market.
In the complaint filed in U.S. District Court in New York, ACV named auction giants Manheim and ADESA, plus smaller wholesalers ServNet Auction Group and Independent Auction Group as defendants.
ACV claims its rivals worked to prevent it from gaining necessary access to AutoIMS, a remarketing platform widely used by commercial consignors in the industry.
The suit also named Auto Auction Services Corp., a joint venture of those four companies and provider of the AutoIMS platform.
And ACV alleged the National Auto Auction Association — a defendant — inconsistently enforced its physical auction requirements in a way that it precluded membership “to certain digital-only platforms like ACV, which pose an existential competitive threat to NAAA’s controlling members.”
ACV asked for injunctive relief, including requests for the court to order NAAA to grant it membership, and for Auto Auction Services Corp. to be compelled to license AutoIMS to it. ACV also said it seeks monetary damages, including legal fees.
The industry is seeing growing interest in 3D scanning technology to improve how and where cars are made.
Toyota uses 3D scanners to supplement machine measurements and to check the quality of parts vendors supply. Engineers at the Japanese automaker also rely on scanners to create digital twins of equipment — even entire manufacturing facilities.
BMW Group said it plans to use 3D laser scanning technology to complete digital scans of its assembly plants by early 2023. Scanning will help create more efficient floorplans for future production facilities.
Ford previously used 3D scanning technology to restore historic Michigan Central Station, which the automaker plans to make the centerpiece of a “mobility innovation district” in Detroit’s Corktown neighborhood.
Ford said it used laser scanners to develop 3D models of various elements of the station that no longer exist, helping to re-create or repair items such as large cast iron windows, decorative trim and elaborate ceiling tiles.
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