AuthorTopic: 🚗 Official Death of the Automobile Thread  (Read 620 times)

Offline RE

  • Administrator
  • Chief Cook & Bottlewasher
  • *****
  • Posts: 39144
    • View Profile
🚗 Official Death of the Automobile Thread
« on: April 27, 2018, 01:32:16 AM »
I almost dropped this in the Death of Retail thread, but then I figured automotive was a special and big category that will start seeing more closures in both production and in dealerships.

Kickoff article below

RE

Ford is basically giving up on US car business, and GM is not far behind

    Ford's plan to reduce its passenger car lineup to just two models, and GM's difficulty selling passenger cars in the U.S. show how much tastes are drifting toward trucks, SUVs and crossovers.
    Ford will only update the Focus Active crossover and Mustang for the U.S. market, while GM called out a challenging passenger car environment.

Robert Ferris   | @RobertoFerris
Published 2 Hours Ago Updated 49 Mins Ago CNBC.com
      
      
2018 Ford Mustang V8 GT
Source: Ford Motor Company

So is it really the end of the American car on its home turf?

From the way Detroit's major executives are talking, it would seem so.

Ford said Wednesday it will only offer two new cars in North America over the coming years — its iconic Mustang and the Focus Active, a rugged-looking hatchback that has already debuted in Europe, and somewhat resembles the Subaru Crosstrek or the Buick Regal TourX.

GM is moving along the same lines.

"I think we have been on this path for a number of years," GM CFO Chuck Stevens said on a call with reporters on Thursday, after the largest U.S. automaker released first-quarter earnings.
Elon Musk's big ambitions may be killing Tesla
Elon Musk's big ambitions may be killing Tesla 
8 Hours Ago | 04:42

Many of Fiat-Chrysler's biggest successes have been SUVs in recent years, evidenced by the growth of its Jeep brand.

"Virtually eliminating Ford's NA car portfolio makes a lot of sense, in our view," said Adam Jonas, an analyst at Morgan Stanley. "No more Fusion. No more Focus. No more Fiesta. No more Taurus."

GM still makes quite a few cars. For now, Chevrolet alone still sells somewhere around 12 car models if you count Corvette, although there have been rumors and news it will cut or end production of at least some of those. Buick has some sedans and a crossover that looks a lot like a wagon, and Cadillac has so many sedans industry observers and dealers say it missed the crossover trend.

And despite the fact that American companies are reshaping their lineups, sedans will still form a substantial portion of the vehicles sold in the U.S. for the foreseeable future.

"Although passenger car segments have declined over the last number of years, they are still very important," GM's Stevens said Thursday. "Small cars are important internationally, and they still make up a chunk of sales in the United States."

But crossover sales were largely what drove GM's earnings beat on Thursday, and the automaker's income was down because it had spent a lot of time retooling its factories — to build more trucks. Buick's best-selling model is the subcompact Encore crossover, and Cadillac's biggest debut this year has been the XT4, a model the company is making to finally catch up with rivals already in the luxury crossover segment.

Throughout the rest of 2018, GM's crossover sales should be strong enough to support margins despite costs from new truck launches, CFRA analyst Efraim Levy said in a note Thursday.

By 2022, almost 73 percent of all consumer vehicle sales in the United States are expected to be utility vehicles of some sort, and about 27 percent will be cars, according to auto industry forecasting firm LMC Automotive.

By that same time, LMC automotive expects 84 percent of GM's U.S. sales volume will be SUVs, crossover and trucks. Ford will be at 90 percent, and Chrysler at 97 percent.

So sedans and other cars are expected to still form more than a quarter of all consumer vehicle sales in the U.S., but the overall trend appears to be that American companies especially are giving up trying to sell cars to Americans.

What will they sell instead?

Detroit is already strong in pickups and large SUVs, such as the Cadillac Escalade and Lincoln Navigator, which is enjoying remarkably brisk sales after its first complete redesign in more than a decade. The Big 3 control almost 85 percent of the domestic pickup market, according to LMC Automotive, despite competitive products from foreign brands such as Toyota and Nissan.

And Ford, for example, will also double down on "authentic off-roaders," Ford President of Global Markets Jim Farley said on a conference call Wednesday, after Ford reported first-quarter earnings. This includes trucks like the Raptor, and the upcoming reintroduced Ford Bronco, and an unnamed SUV. GM and Chrysler are entering this segment, too.
Ford Mustang is displayed at the 88th Geneva International Motor Show on March 7, 2018 in Geneva, Switzerland.
Ford beats the Street 
20 Hours Ago | 01:30

The second-largest U.S. automaker also plans to refresh its current lineup of SUVs and crossovers and create new products that fill "white spaces" in the market, essentially meaning the company will try to combine or tweak various designs or combinations of features to find new segments no other company is targeting yet. This means combining various elements of both cars and SUVs in ways that distinguish Ford's vehicles from what is already out there.

"We will have a very diverse passenger car business," Farley said on the call. "It just won't be traditional silhouetted sedans that tend to be commoditized."

In ditching cars and pursuing this strategy, Ford made a difficult choice, said Kelley Blue Book analyst Rebecca Lindland.

"I think this is one of the challenges that the Big 3 has faced, that they really had a tough time finding their way on the car side," Lindland told CNBC. "They have struggled for too long to be profitable, to be a full-line manufacturer, and they have made the hard decision to start over. The problem is they are so far behind."

Farley is very smart, Lindland said, and Ford has a catalog of vehicle platforms around the world they can search through to quickly develop some products. But it will be challenging.

"Even though they are starting fresh, they have to accelerate their timeline to get their products as soon as possible," she said. "I am driving a Toyota C-HR right now, which I believe is the kind of car they are thinking about making."
« Last Edit: April 27, 2018, 01:34:02 AM by RE »
Save As Many As You Can

Offline Palloy2

  • Global Moderator
  • Sous Chef
  • *****
  • Posts: 6097
    • View Profile
    • Palloy's Blog
Re: 🚗 Official Death of the Automobile Thread
« Reply #1 on: May 15, 2018, 04:01:16 PM »
https://www.zerohedge.com/news/2018-05-15/tesla-shutter-model-3-production-stock-extends-losses

Tesla Will Pause Model 3 Production, Stock Extends Losses

Tyler Durden
05/15/2018

Tesla share price continues to tumble down towards its bond price following headlines from Reuters, citing sources, that the car-making company will shutter production of the Model 3 from May 26th to 31st for "fixes to its assembly."

    TESLA PRODUCTION SHUTTERED FROM MAY 26-MAY 31, REUTERS SAYS
    TESLA IS SAID TO PAUSE MODEL 3 PRODUCTION FOR FIXES: REUTERS

Reuters notes that two sources confirmed that the next stoppage on the general assembly line at the Fremont, California, plant was scheduled for May 26-31.

The production-challenged electric vehicle maker previously warned of 10 days of temporary shutdowns this quarter as the company addresses manufacturing problems that have delayed volume production of the Model 3 sedan, which is seen as crucial to Tesla’s long-term profitability, Reuters adds.

This follows the previous production halt on April 17th to make "on-the-fly fixes", as well as a prior stoppage in February.  The April shutdown, combined with the upcoming one, would add up to the planned 10 days of stoppages.

    Tesla has been struggling to find solutions to manufacturing bottlenecks on the new assembly line that produces the Model 3, a sedan intended for volume production. An over-reliance on robots has complicated that task, Chief Executive Officer Elon Musk has acknowledged.

    Musk, Tesla’s billionaire founder, told employees it was “quite likely” the company would reach a rate of 500 Model 3s per day this week, or 3,500 a week, automotive news website Electrek reported on Tuesday, citing an internal email. Musk also told staff to alert him of “any specific bottlenecks” on the production line.

While Musk has said the planned stoppages are intended to give the company time to perform upgrades that will help it reach a goal of building 6,000 vehicles per week by the end of June, the market is becoming increasingly skeptical, especially since in order to meet the production goal of 6,000 cars per week by the end of July, Musk said last month that all Model 3 production would begin working around the clock.

Reuters learned that the teams working on general assembly have already switched to three shifts, a schedule that helps maximize capacity and flexibility; the news wire adds that teams working on the body of the vehicle - where the external shell of the car is assembled - are working in two 12-hour shifts.

Meanwhile, TSLA is extending losses:



Catching down to the bond's weakness...



 
"The State is a body of armed men."

 

Related Topics

  Subject / Started by Replies Last post
1 Replies
1762 Views
Last post December 01, 2013, 11:40:59 PM
by RE
37 Replies
6504 Views
Last post October 09, 2019, 05:13:16 PM
by Surly1
287 Replies
35755 Views
Last post Today at 08:01:28 AM
by azozeo