Auto File: Nissan’s Game of Thrones

Element 25

26/06/2023 16:15

June 26 - 
    Joe White 
    Global Autos Correspondent 
 

    Greetings from the Motor City! 
 
It is good to be back, even if just for a week. Really, what’s
going to happen in the summer when everyone is thinking about
cookouts and beaches? A Russian Revolution? Wait… what? 
 
We’ll leave Russia to the experts who inform the Reuters World
News podcast. There’s plenty happening in the World of Cars.
Let’s dive right in. Today - 
    *         Knives out at Nissan 
    * A reality check for second life batteries 
    * How China is winning the EV race     

 

    * A new power struggle at Nissan 
    Missing the drama of “Game of Thrones” and “Succession?”  
    Nissan’s got you covered. The automaker’s board has hired
outside investigators to determine whether CEO Makoto Uchida put
his deputy, Ashwani Gupta, under surveillance. Gupta, once seen
as a successor to Uchida, was abruptly bounced from the
company’s board last month and will leave the company later this
month. 
    Details of the accusations by Nissan senior adviser Hari
Nada, reported by Reuters colleagues Daniel Leussink, Nori
Shirouzu and Maki Shiraki, read like a treatment for HBO’s next
drama of intrigue and treachery in high places.  
    The Uchida-Gupta conflict surfaced just days after former
Nissan CEO and international fugitive Carlos Ghosn launched a $1
billion lawsuit against the automaker and vowed to fight “to the
end” to prove he was the victim of slander and false evidence
created by Nissan officials. (Nissan declined to comment on
Ghosn’s suit.) 
    Nada played a central role in the investigation that led to
Ghosn’s fall from power. 
    Nissan’s successive power struggles have a connecting
thread: Internal clashes over the troubled alliance with
France’s Renault. Whenever Nissan’s outside directors sort out
the Uchida-Gupta situation, they will still face the challenges
of catching up from behind in the race to compete with Tesla and
surging Chinese automakers.     
 

    * Essential Reading 
    *         Industrial unions want a bigger slice of the pie 
    * Wall Street says Tesla’s rally is overdone 
    * What if Tesla and Meta had a cage match?     

 

    * Second life batteries need a second look 
    The concept of a “circular economy” in which resources such
as electric vehicle batteries get a second life as energy
storage systems rather than being discarded or recycled has
gotten a lot of attention in the auto industry, and from some
investors.
    But reusing partially spent EV batteries turns out to be
easier in theory than in fact, Reuters colleagues Nick Carey,
Paul Lienert and Victoria Waldersee report. 
    EV batteries turn out to last longer than expected, and the
value of battery materials makes recycling more economically
attractive than using batteries for backup power.     
 

    * Aston, Lucid and Saudi Arabia 
    Saudi Arabia’s sovereign wealth fund is getting behind a new
consolidation move in the EV industry.  
    British premium brand Aston Martin said it has struck a deal
with luxury EV startup Lucid to use Lucid’s EV technology for
future Aston models. Lucid will get a 3.7% stake in Aston plus
cash. To oversimplify: Aston gets EV tech it badly needs. Lucid
gets some additional scale and revenue that it could use to
extend its runway after bruising losses. 
    Investors liked the deal: Lucid and Aston shares both rose
Monday. 
    A potential winner in this cost-sharing deal, seated on both
sides of the table, is the Saudi public investment fund, which
owns stakes in both struggling companies and recently agreed to
plow $3 billion more into Lucid.     
 

    * The ICE is melting, China is winning 
    Automakers who want to thrive as electric vehicles take a
greater share of global vehicle sales must look at how the best
of China’s EV manufacturers are winning.  
    That’s one takeaway from a comprehensive overview of the
state of play in the global auto industry released Monday by
AlixPartners, a consultancy with a wide-ranging automotive
practice. 
    Chinese EV brands could control as much as 58% of the
world’s largest auto market by 2030, AlixPartners’ Stephen Dyer
said during a call Monday. Add in Chinese internal combustion
brands, and 65% of the Chinese market will be owned by domestic
brands. 
    China’s EV brands are winning because they put a priority on
speeding new models and new high-tech features into the market,
worrying less about traditional car industry values such as ride
and handling, power and perfect quality, Dyer and Mark
Wakefield, co-leader of AlixPartners auto practice, said.
    Relying on profits from Internal Combustion Engine, or ICE,
vehicles is a short-term strategy, Wakefield said. 
    “We have an ICE melting situation,” he said. As sales of
combustion vehicles decline - more rapidly in China and Europe,
but inevitably in North America, too - automakers should look to
China’s automakers for lessons on how to survive.  
    The alternative is to wait for Chinese automakers to eat
their lunch in their home markets. China is on track to be the
leading vehicle export nation this year, AlixPartners said in
its report.      
 

    * Fast Laps 
        - The father of the lithium battery, University of Texas
Prof. John Goodenough, has died at the age of 100, UT confirmed
Monday.
    - Ford and Honda are wrestling with big recalls. Ford is
recalling Explorer SUVs with driveshafts that could disconnect.
Honda has 1.3 million vehicles with rear camera displays that
could go dark.
        
    - 
    Australian miner Element 25 will supply battery materials to
General Motors. Shares in Element 25 soared by 20%.
        - Ford will get $9.2 billion in subsidized loans from
the Biden Administration to underwrite construction of three
U.S. battery plants. But with the government’s helping hand
comes a healthy helping of backlash. The United Auto Workers
union blasted the Biden administration for subsidizing non-union
plants, and the conservative Wall Street Journal editorial page
said Ford will now have to dance to Washington’s tune.
        - Alpine Racing is going Hollywood. A group that
includes actors Ryan Reynolds and Rob McElhenney is taking a 24%
stake in the Formula One team.
        
    - 
    GM has dropped the promised $39,000 version of its electric
Silverado pickup truck. The initial electric Silverado models,
due to start production in a few weeks, will start at $77,905,
excluding shipping charges. They also will not have on-board
charging ports compatible with Tesla Superchargers. Those arrive
in 2025.     
 

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 (Editing by Andrew Heavens)