In Europe, automakers including Volkswagen, Opel, Peugeot and Renault-Nissan are all either considering structural changes or facing a crisis
The European auto industry is in turmoil as it prepares for the Geneva auto show in March.
Automakers would rather be talking about sleek new vehicles and exciting technologies, but corporate drama will loom large.
Here’s an overview to help you recognize some of the players and their potential roles:
According to a confidential presentation obtained by the German business weekly WirtschaftsWoche, Handelsblatt’s sister publication, Telefonica is offering to sell customer information to retail chains and shopping centers. Documents intended for retail managers showed the company had mined specific “insights” about age, gender, origin and movement from its 44 million mobile customers.
Telefonica is the only German mobile operator selling customer data as a new branch of business. Deutsche Telekom canceled a pilot project on the analysis of customer data last year following privacy protests.
In Germany, public opinion is the greatest challenge to telecommunications companies looking to profit from big data. Citizens have long-standing concerns about spying, a legacy of the Nazi era and Cold War times.
Buying a car is only the beginning of the expenditures: there’s the hundreds of dollars in insurance each month, and then thousands more in maintenance over a car’s lifetime.
Tesla wants to change that. During its earnings call Wednesday, the company revealed that it wants to offer a pay-one-price model that will include both insurance and maintenance for the entirety of the vehicle’s lifetime.
Tesla has already been testing the business model in Asia.
Currently, existing car insurance companies underwrite the policies with Tesla paying for them upfront and then tacking the cost onto the car’s purchase price, but CEO Elon Musk made it clear Tesla would explore all options. “If we find that the insurance providers are not matching the insurance proportionate to the risk of the car, then if we need to, we will in-source it,” he said during the call, according to Elektrek. “But I think we’ll find that insurance providers do adjust the insurance cost proportionate to the risk of a Tesla.”
After the 2014 rollout of the Autopilot feature, which aids drivers during highway driving, Teslas were found to get in 40 percent fewer accidents, according to a report released by the National Highway Traffic Safety Administration in January. That study came in response to a fatal crash in May 2016, in which a Tesla vehicle using Autopilot crashed into a tractor trailer, killing its driver. Tesla concluded that the vehicle’s system had not noticed the white, reflective trailer against the sky. Months later, it released a software update that Musk said would likely have prevented the problem.
ALMOST 150 years after photovoltaic cells and wind turbines were invented, they still generate only 7% of the world’s electricity. Yet something remarkable is happening. From being peripheral to the energy system just over a decade ago, they are now growing faster than any other energy source and their falling costs are making them competitive with fossil fuels. BP, an oil firm, expects renewables to account for half of the growth in global energy supply over the next 20 years. It is no longer far-fetched to think that the world is entering an era of clean, unlimited and cheap power. About time, too.
There is a $20trn hitch, though. To get from here to there requires huge amounts of investment over the next few decades, to replace old smog-belching power plants and to upgrade the pylons and wires that bring electricity to consumers. Normally investors like putting their money into electricity because it offers reliable returns. Yet green energy has a dirty secret. The more it is deployed, the more it lowers the price of power from any source. That makes it hard to manage the transition to a carbon-free future, during which many generating technologies, clean and dirty, need to remain profitable if the lights are to stay on. Unless the market is fixed, subsidies to the industry will only grow.
Some Uber users trying to delete the app are getting a notification from the company specifically mentioning the allegations of sexual harassment detailed over the weekend in a blog post by former employee Susan Fowler Rigetti.
A screenshot of one such interaction, confirmed to Mashable as authentic by an Uber spokesperson, demonstrates the lengths to which the company is going to assure fleeing customers that “what [Fowler] describes is abhorrent and against everything Uber stands for and believes in.”
A report by IBNR Weekly, one of the most respected publications in insurance, alarmed many industry-insiders:
“In an attempt to better understand Lemonade’s “killer” pricing, we “applied” for renters insurance through the Lemonade and Bungalow websites… the pricing was dramatically different as Bungalow’s annual price was ~5.6x Lemonade.” (IBNR Weekly, September 29, 2016)
Incumbents find the idea of a 560% price gap unsettling. Understandably. Beyond self-preservation jitters, some raised concerns about Lemonade’s ‘killer prices’ looking a lot like ‘suicidal prices.’ After all, they reasoned, insurance companies pay out in claims over 40% of the fees they collect. So if Lemonade charges 80% less (same as saying others charge 5x more) Lemonade will be paying out in claims more than it receives in premiums! Lemonade must be recklessly naïve or worse, they surmised, and insolvency just a matter of time.
I get it. That’s why I’m writing this post.
To paraphrase Elon Musk, Silicon Valley is learning that “Making rockets is hard, but making cars is really hard.” People outside of the auto industry tend to have a shallow understanding of how complex the business really is. They think all you have to do is design a car and start making it. But most startups never make it past the concept car stage because the move to mass production proves too daunting. Even Tesla, the only successful automotive company to come out of Silicon Valley so far, made but 80,000 cars last year and it’s been in business for nearly 15 years.
In 2008 the anthropologist Daniel Miller published a book based on an intimate study of 30 households on a single street in south London. The Comfort of Things explored the different kinds of relationships people have with what they own.
Miller described a retired couple’s house, cluttered with furniture, framed photographs and knick-knacks accumulated over decades. Down the road, a self-employed man called Malcolm had rented a flat. Malcolm preferred a spartan existence: he kept his belongings in storage, the better to travel at short notice, and conducted as much as possible of his life online. His home was his email address. His central material possession was his laptop.
We were talking just the other day about how slow it is to change the automotive market because of its gigantic size. With around 2 billion cars on the roads around the world and an annual production capacity of roughly 100 million cars, it takes 20 years to update the global fleet. It means that once all new cars sold are equipped with a new technology, like electric propulsion, it can take up to 20 years to refresh the fleet.
Of course, some markets will get there before others. Electric vehicles currently have difficulties reaching 3% market share in most countries. Norway has long been the exception to the rule and it is now breaking more market share records.
“Europe is not only an incredibly competitive and crowded market, it’s also an incredibly complex market: 31 countries each with their own regulations and taxation regime,” Kia Europe operations chief Michael Cole told Automotive News, fresh from unveiling the brand’s next-generation Picanto mini-car here.
Questioned by European Union parliamentarians about the patchwork of car taxes, Finance Commissioner Pierre Moscovici admitted last March that the problem was a “source of high administrative burden for citizens,” but past legislative proposals to fix this “did not obtain the required unanimous support of member states.”
Financial reporting practices also differ: U.S. carmakers break out their results by region, creating instant yet often ugly transparency — particularly when losses in Europe ballooned in 2013. Many companies, however, don’t bother informing investors whether their operations in Europe are in the red, including potential Opel owner PSA Group. Volkswagen, for example, did away with regional accounting 10 years ago in favor of global results by brand, helping to conceal its chronic losses in North America.
When I first got in the Prius in 2001 the dealership kept me there for 4 hours “teaching” me how to drive and own the car as though it was some exotic device. It came with a plastic reference card to use if I valet parked the car. I had to watch video tapes. It was pretty crazy since by and large other than regenerative braking it was just a car.
The Bolt is totally different but they just send you off. I loved that. (OK, it is a Detroit car maker so I spent like 3 hours in the finance cave dealing with that, but I digress).
There are like 5 screens about energy usage. The biggest learning (and sort of a less than positive surprise) is that climate control is like 15% of energy usage. So you sit in the car in traffic having Apollo 13 moments by turning off features and seeing the car range go up or down. On a full charge I drop from a high of 238 to 216 by turning off the climate system and radio. This all reminds me of the first Prius owners that talked about driving without shoes so you could feel if the car was on battery or combustion. This craziness will pass as it did with Hybrids.
Total U.S. household debt climbed to a near-record $12.58 trillion by the end of 2016, a Federal Reserve Bank of New York report says.
February’s 33-page “Quarterly Report of Household Debt and Credit” shows that every category of debt measured — including mortgages, credit cards, student loans and auto loans — saw an increase. The total increase of $460 billion in 2016 was the largest in a decade. Mortgage balances, now at $8.48 trillion, made up 67 percent of the household debt.
Deaths resulting from motor vehicle crashes are at their highest in nearly a decade, according to preliminary data released by the National Safety Council on Wednesday. The increase for 2016 combines with the jump in 2015 to add up to the largest two-year increase in motor vehicle-related deaths in 53 years, an increase NSC President and CEO Deborah A.P. Hersman noted in a release is at least partly attributable to “complacency” on the part of drivers.
The preliminary numbers from the NSC aren’t final, and the organization says that it’ll experience slight increases or decreases as more data comes in and more analysis is performed. But the estimates usually don’t see dramatic shifts, so you can expect their early estimate of roughly 40,000 motor vehicle deaths in 2016 to remain consistent. The tally represents a 6 percent increase over last year, and a 14 percent bump when compared to the numbers from two years ago in 2014.
China’s ride-sharing boom was once seen as a path to prosperity for thousands of drivers. However, a government crackdown on an industry dominated by Didi Chuxing has brought that dream to a screeching halt.
In Beijing and other major cities, non-resident drivers are now banned. That’s left many struggling to pay off loans they’d taken out to buy cars.
Drivers must therefore take the risk of getting nabbed without the right permit by staying on the roads. Now struggling for money, many live in a drab row of concrete homes known by locals as “Didi village.” Its paths are filled with trash and there’s an outdoor toilet, but the rent is cheap.
Daimler has ambitious plans for electric vehicle production. It is among the few major automakers that not only have accepted the transition to fully electric propulsion in the auto industry, but who have also committed to converting production assets currently dedicated to internal combustion engine production. That’s a difficult move for large legacy automakers.
In one of its biggest move toward that goal, the company announced today plans for its major Untertürkheim plant to produce electric motors in a deal with workers.
A disused factory complex in the southern Chinese city of Shenzhen could hold the key to 21st-century carmaking.
The location, now being prepared at top speed, will be the headquarters and main production location for FMC. Remember the name: with the backing of three huge Chinese conglomerates, and led by two leading German auto executives, FMC—Future Mobility Corporation—wants to conceive and build the world’s first truly mass-market electric car. The future of mobility, they say, will be born in China.
“We want to be the Apple of the car industry,” says Carsten Breitfeld, FMC’s German chief executive. Some may scoff at the grandiose claims: FMC is less than a year old, has no factory, and hasn’t produced a single car.
Urbanites generally consider Austin the coolest city in Texas, if not America. It has a great university, great music, hip and trendy restaurants and bars, unique shops and a booming tech economy. It also has god-awful traffic for a city its size.
Metro Austin has 2 million people. All of them seem to be driving on Interstate 35 all the time. Getting across town east-west is even worse because there’s really no main route. Bus service is just OK, and there’s only one light rail line. (Voters shot down an expansion of the rail system a couple of years ago.)
No matter how cool it is — and how urban its core may be — Austin is really just an overgrown suburb. And it’s not the only one. Nashville has many of the same problems. Atlanta’s traffic problems are legendary. And in Southern California, Orange County may be an economic powerhouse, but it’s also a transportation backwater with the same population as neighboring San Diego but only half as many freeway miles.
Ford Motor Co. is investing $1 billion in a months-old startup founded by two pioneers in the nascent autonomous vehicle sector.
The Pittsburgh-based artificial intelligence company Argo AI will develop the brains — specifically, a virtual driver system — for the fully autonomous vehicles Ford has promised to bring to market in 2021. Founders Bryan Salesky and Peter Rander are former leaders of the self-driving car teams at Alphabet Inc.’s Google and Uber Technologies Inc.
“This is a unique partnership,” Mark Fields, Ford’s chief executive officer, said in an interview. “A lot of tech companies are looking for customers and a lot of OEMs are looking for technology partners. We are getting expertise, and Argo AI is getting a customer in Ford.”
Ford’s investment, planned for over the next five years, reflects how hot the race for autonomous vehicles is within an industry facing other seismic shifts including electrification and ride-sharing. Self-driving vehicle startups are emerging at a frenetic pace after General Motors Co. and Uber valued upstarts — each with just a few dozen employees — as worth hundreds of millions of dollars in separate acquisitions last year.
Salesky, who worked on the self-driving car project at Google, and Rander, who held a similar role at Uber, have no other backers. Argo AI will function as a subsidiary of Dearborn, Michigan-based Ford, though the startup will be independent and offer equity to engineers, said Raj Nair, Ford’s executive vice president of global product development and its chief technical officer.
* Avis Budget Group Inc – program will be initially launched in Boston Source text for Eikon: Further company coverage:
The point isn’t just to get giddy about Tesla again — the point is that it shows how effective and even critical this 100% electric, from-the-ground-up, high-end-models-first, full-EV-ecosystem approach has been. Where would the rest of the EV market be if Tesla hadn’t pushed it forward? Where would the rest of the market be if one of the most desirable cars in history wasn’t a fully electric car?
Similarly, the LEAF targeted a lower class when it was introduced in 2011, but the “from-the-ground-up” approach continues to carry it forward at the top of the electric car sales charts.
Everything, everywhere, will soon be continuously recorded and uploaded to the internet. This will start with dense, urban areas, but over time every single square meter of every part of the globe will be recorded. Advances in computer vision & AI mean this data will be usable at scale, which will revolutionise advertising, law enforcement, and bring us back to a pre-privacy world.
(and yes, you guessed it, the movie to pair this post with is Minority Report)
Automakers face a difficult challenge: They must strike the right balance between selling enough electrified vehicles (EVs) to comply with tightening regulatory fleet emissions and fuel economy targets, while preventing the incremental cost of adding costly battery packs to their vehicles from cannibalizing corporate profits. To compound matters, automakers cannot afford to lose focus on combustion engine models, which are often more profitable. Against this backdrop, our latest report provides fresh insights and potential solutions.
Within this report, McKinsey is releasing new findings from a global survey on consumer attitudes toward EVs that include plug-in hybrid and battery electric vehicles. Our analysis reveals current pent-up consumer demand for EVs with some stubborn and well known barriers, but also provocative and unexpected opportunities. The report highlights three key messages:
Robotic cars are great at monitoring other cars, and they’re getting better at noticing pedestrians, squirrels, and birds. The main challenge, though, is posed by the lightest, quietest, swerviest vehicles on the road.
“Bicycles are probably the most difficult detection problem that autonomous vehicle systems face,” says UC Berkeley research engineer Steven Shladover.
Nuno Vasconcelos, a visual computing expert at the University of California, San Diego, says bikes pose a complex detection problem because they are relatively small, fast and heterogenous. “A car is basically a big block of stuff. A bicycle has much less mass and also there can be more variation in appearance — there are more shapes and colors and people hang stuff on them.”
U.S. automakers’ failure to sell their cars in Japan has been a gripe for Detroit since the Carter administration. Another round of whingeing looks set to begin.”It’s not fair,” the Nikkei Asian Review quoted President Donald Trump as telling a meeting of chief executives at the White House Monday. “They do things to us that make it impossible to sell cars in Japan.”On the numbers, he appears to have a point. Ford Motor Co. announced last year it was pulling out of Japan, saying the nation was the most closed developed auto market in the world.General Motors Co. is an even smaller presence. Its mighty Buick marque typically sells fewer units in Japan than Morgan Motor Co., a family business based in an English spa town that hand-builds about 1,300 Jazz Age-styled cars a year.Only Fiat Chrysler Automobiles NV does better, with its Jeep brand selling more models in Japan than GM and Ford put together. But SUVs are a rare presence on Japanese roads, so that makes Detroit’s third player a decent-sized fish in a very small puddle.Prime Minister Shinzo Abe has a different explanation for U.S. automakers’ failure to compete: They’re simply not trying. They don’t advertise on television, exhibit at the Tokyo Motor Show, or even make much effort to build vehicles for Japan’s right-hand-drive market, he said Monday.They also have to battle consumer perceptions that they’re costly and poor quality, something for which the government can’t really be blamed.The truth is largely on Abe’s side. While the U.S. has a 2.5 percent tariff on all passenger car imports and imposes 25 percent on trucks, Japan removed its last levies on auto imports almost four decades ago.Imports are certainly a small share of the market, but they’re on the rise — going from about 4.5 percent of sales in 2012 to 5.9 percent last year.