Auto file-Washington Tortoise, Detroit Hare
02/06/2023 15:00
June 2 -
Joe White
Global Autos Correspondent
Greetings from the Motor City!
It’s Friday, and I am looking forward to a road trip, and to
spending the weekend not checking my phone to see if the U.S.
government is going to default on its debts. Whew!
Washington’s struggle this week with the basic functions of
government overshadowed fresh demonstrations of how technology
is outrunning federal regulators and lawmakers. It’s not just
artificial intelligence. We’ll get into that, along with happier
news from the World of Cars. Today –
* Washington takes a big, late step on safety
* Toyota revs up its U.S. EV game
* VW brings the Buzz
Washington chases auto technology
The Biden Administration outlined proposals to require that all
new vehicles have automatic emergency braking (AEB) technology
that can anticipate a collision, and automatically apply the
brakes at speeds up to 62 miles per hour. The administration
also outlined new performance standards for pedestrian
protection AEB, including a requirement that the systems work at
night.
This is one of the U.S. government’s most significant new
vehicle safety actions in years. It also shows how slow the
government regulatory machinery is compared to the pace set by
automotive technology innovation.
Automatic braking technology has been on the market for years.
The European Union mandated that all passenger vehicles have AEB
as of last year.
Automakers in the United States agreed in 2016 to make AEB
standard equipment as of 2023. Some moved rapidly to equip
vehicles with automatic braking ahead of the deadline.
Others took more time. As of last year, about 27% of General
Motors vehicles did not have AEB, according to the Insurance
Institute for Highway Safety, which tests vehicles and gives
safety scores. Jaguar Land Rover, Maserati and Porsche had AEB
installation rates between 70% and 75%.
GM said it is on track to have AEB on all its EVs and 98% of all
models by the end of 2023.
Not all current automated braking and pedestrian protection
systems may meet the new National Highway Traffic Safety
Administration (NHTSA) performance targets. But automakers will
have three years from the time the rules are adopted to upgrade.
Bottom line: The IIHS/Highway Loss Data Institute estimates it
will take until 2045 for 95% of the vehicles on the road to be
equipped with collision-avoiding braking.
AEB is not novel technology. Nor are airbags – another
technology that NHTSA is struggling with. The agency this week
escalated an investigation into millions of airbags that could
explode. The airbag maker, ARC Automotive, is resisting a recall
order.
On Thursday, the Transportation Department’s inspector general
said NHTSA routinely fails to meet its own deadlines for
completing vehicle safety investigations.
Meanwhile, automotive technology keeps racing ahead. Automakers
are deploying automated driving technology with no regulatory
guidelines. Dashboard displays that can connect drivers and
passengers to immersive videogames, Zoom meetings and AI enabled
chat-bots are here, or just around the corner.
NHTSA has reacted to the tech tsunami on a case-by-case basis.
The agency ended an investigation of Tesla after the company
agreed not to allow passengers to access games while the vehicle
is in motion. It continues to investigate Tesla’s Autopilot
assisted driving technology after a series of accidents.
But comprehensive standards for automated or fully self-driving
cars are still a work in progress – even as robo-taxi operators
Cruise and Waymo and several robo-truck companies expand
deployment.
Essential Reading
* The backlash against “Mega-EVs”
* OPEC may not spoil your road trip after all
* Good news for Detroit: U.S. businesses are hiring
Stellantis, GM pay big fuel economy fines
Stellantis and General Motors paid a total of $363 million
in fines for falling short of U.S. fuel economy targets, Reuters
colleague David Shepardson reported exclusively Friday.
“The record-setting penalties include $235.5 million for
Stellantis for the 2018 and 2019 model years and $128.2 million
for GM covering 2016 and 2017, according to the National Highway
Traffic Safety Administration,” Shepardson writes.
The Biden Administration last year reinstated tougher financial
penalties on automakers that failed to meet minimum fuel
efficiency standards under the Corporate Average Fuel Economy
program.
VW catches a Buzz
Volkswagen made it official: An electric reincarnation of the
classic Microbus, now called the ID.Buzz, is on the way to North
America next year. Grateful Dead fans can rejoice. Few vehicles
have been promised, and then shelved, more often than a
successor to VW’s beloved 1960s-era microbus. The last version
of the vehicle was pulled from the U.S. market 20 years ago.
The Buzz will be one of several “three-row” electric vehicles
headed for the U.S. market (see the Toyota item above, and
Ford’s promise of a “personal bullet train.”) Now all that’s
needed is an automated designated driver to get everyone safely
back from the show.
Toyota amps up its U.S. EV strategy
Just ahead of a contentious shareholder meeting, Toyota said it
will launch a new EV at its Kentucky factory offering three-rows
of seating for families. Toyota is also expanding a North
Carolina battery factory.
Timely announcements, because Toyota Chair Akio Toyoda is under
pressure from shareholders, including California and New York
state pension trusts, unhappy with his cautious approach to
electrification.
EV/ICE parity: It’s only a decade away
The turning point when electric vehicles cost the same to build
as an internal combustion engine (ICE) car or truck may not come
until after 2030, Ford CEO Jim Farley told an investor
conference.
What’s more, Farley said, ICE/EV cost parity depends on
dramatically lower labor costs for assembling EVs – an unwelcome
message to United Auto Workers union leaders gearing up for
tough contract bargaining with the Detroit Three later this
summer. Farley’s determination to slash sales and distribution
costs for Ford EVs is equally jarring for Ford dealers.
ICE/EV cost parity is a sensitive topic for established
automakers such as Ford, which are losing money on their
low-volume EVs. Not so much for Tesla, which earns
industry-leading profit margins (padded by federal subsidies) on
its EV-only portfolio and is using those margins to undermine
rivals’ prices.
Elon Musk’s Excellent Chinese Adventure
Elon Musk’s private jet left China yesterday, according to
flight tracking data. Tesla’s Technoking had a fine time during
two days in the Middle Kingdom. He was feted in Chinese social
media, and got to meet Vice Premier Ding among other senior
officials – at the same time Chinese officials were snubbing the
U.S. Defense Secretary.
Musk also visited workers at Tesla’s Shanghai factory, but
mostly he kept quiet during his China tour. He was back on
Twitter early this morning, commenting on posts that had little
to do with cars.
Fast Laps
Lucid said it will raise $3 billion, mainly by selling more
shares to Saudi Arabia’s sovereign wealth fund. The Saudi PIF
already controls about 60% of Lucid’s stock. Other Lucid
investors were not thrilled at the potential dilution. Lucid
shares dropped 16%.
Tesla amped up its Q2 clearance sale, doubling discounts on
vehicles in its U.S. inventory. All Tesla needs to do now is to
post a GIF of a car dealer air dancer on its website.
General Motors and POSCO will expand a venture to build capacity
for battery cathode and anode material in North America. Key
words: Inflation Reduction Act subsidies.
Nikola is considering a reverse stock split to prevent its
shares from being de-listed by NASDAQ. The electric/hydrogen
truck maker is pleading with shareholders to approve an increase
in the number of shares.
Connected vehicle data company Wejo filed notice that it will
enter administration – bankruptcy under UK law. Wejo had A-list
investors – Microsoft, General Motors, insurer Sompo Holdings
and dark arts software company Palantir. Wejo went public via a
SPAC deal valued at $800 million. Now it is another casualty of
the deflation of the Connected-Autonomous-Shared-Electric
investment bubble. Automotive tech analyst Roger Lanctot has a
scorching take here.
Disgruntled Renault customers want to pursue a criminal
complaint in France against the automaker. At issue are faulty
engines lawyers for the customers say are unsafe. Renault said
it has been trying to resolve the issues.
A regular F-150 truck not powerful enough for you? For a list
price of $12,350, Ford will sell you a street legal supercharger
kit to boost a stock, 400-horsepower, 5.0-liter eight-cylinder
engine to 700 horsepower. Will it outrun a Cybertruck? Maybe
Elon Musk and Jim Farley will stage a drag-race to find out.
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(Editing by Mark Potter)