COVID-19 has disrupted supplies of Mexican made engines to Ford plants in the US
With resurgences of infections and hospitalisations surging again in locations such as the US, parts of Spain and even the city of Leicester here in England, we cannot yet say COVID-19 is beaten and on the wane. Bring on that vaccine (which is looking more encouraging by the day). Meantime, the virus still gets a namecheck in some just-auto stories but, as a peruse of our updated-daily summary story will show you, there is a little less of the virus in the news these days, seven months on from the initial outbreak in China.
But it’s by no means down and out. Case in point described in this week’s most-read news article: Ford in the US is facing production shortages due to COVID-19 production constraints at an engine plant in Mexico. Reports said the Blue Oval’s engine plant in (look away now, Mr Trump) Chihuahua was operating at just 50% capacity due to the coronavirus and Ford Super Duty truck production at Kentucky was in line to be impacted. Kumar Galhotra, president of Ford’s Americas and International Markets Group, pointed out the variance in current rates of capacity utilisation between its Mexico and US manufacturing operations. “Due to COVID-19, the state of Chihuahua in Mexico has limited employee attendance to 50%, a region in which we have several suppliers,” he said. “With our US plants running at 100%, that is not sustainable. While we do not expect any impact to production next week, we are continuing to work with government officials on ways to safely and constructively resume remaining production.” The news from Mexico serves as a wider warning to the auto industry – regardless of some slowly growing, optimistic news from around the globe – the COVID-19 pandemic is far from over and that international supply chains remain very vulnerable.
Having its own engine plant in the same country as most of its vehicle assembly plants, instead of timezones away, is likely paying off for Tata Motors’ Jaguar Land Rover which this week announced yet another variant of its modular Ingenium engine series, this time, a diesel, inline six (I6) with 48V MHEV technology. JLR also announced the Wolverhampton engine plant had passed the 1.5m unit mark, as it completes its long-running moves to in-house-made engines from powerplants bought in from former owner Ford.
Barely a day goes by now without EV news of some sort. One story which caught your eyes was BYD – best known here in the UK for its growing sales of all electric buses – launching the new Han EV series, its flagship competitor in the global mid to large luxury sedan segment and offered in three pure electric versions plus one hybrid. Sales begin in China. The extended-range version will sell at CNY229,800 (US$32,774), the extended-range variant of the premium model will be CNY255,800 and the 4WD high-performance version will cost CNY279,500. The PHEV, badged Han DM, will sell for NY219,800. BYD claimed the new line includes “the most advanced technologies in the electric vehicle industry” and boasts “formidable performance combined with stylish craftsmanship”. It’s the first mass produced model to use the automaker’s own, new, in-house made “ultra-safe” Blade Battery. The long range pure electric version has a claimed single charge range of 605kkm (376 miles) based on the NEDC test cycle. The 4WD high performance accelerates from 0 to 100km/h in just 3.9 seconds, making it China’s fastest production EV, while the DM (Dual Mode) PHEV does the same sprint in 4.7 seconds, making it the country’s fastest hybrid sedan. The automaker didn’t hold the hype, claiming the Han series will “create a new global standard for EV technology and quality, shaking up the traditional luxury car market while accelerating the global shift to electric vehicles”. It’s named after one of the most celebrated dynasties in Chinese history and also “demonstrates the country’s growing manufacturing prowess”. We’ve only seen the photos and read the blurb but it does look good. Should Tesla, and VW gearing up to build I.D. BEV products in China, be worried?
We do, as you know, keep an eye on suppliers. Tenneco has appointed Kevin Baird as chief operating officer, effective 3 August. He joins the executive leadership team and will head and support strategic and operations initiatives. Baird joins Tenneco from Guardian Industries, a wholly-owned subsidiary of Koch Industries, where he served since 2014 as president and CEO of its Guardian Glass business.
Our new and future products guru never stops keeping us up to date and this week, in a second article on BMW, he focused on SUVs, including some of the growing number of PHEV models from Munich. The third generation X1 is expected to appear in early 2022. It will use Frontantriebsarchitektur, a new platform derived from the existing UKL1 and UKL2. FAAR is BMW Group’s next generation front- and all-wheel drive architecture. There is speculation that the brand’s smallest SUV could be one of the models which BMW will manufacture at the Hungarian plant which it announced in July 2018. The factory is near Debrecen, the country’s second largest city, about 120 miles east of Budapest. Initial capacity will be 150,000 vehicles per annum. The rest – X2 to X8 – is well worth a read.
Waiting to buy a Level 5 autonomous car? It’s getting closer. Or not. As one of our own analysts noted, Tesla CEO Elon Musk said last week he believed the electric car company would have “basic functionality” for level 5 vehicle autonomy complete by the end of the year. He was speaking in video comments made at Shanghai’s annual World Artificial Intelligence Conference (WAIC). But we believe market-ready level 5 vehicles will not be available for several more years and have significant product development hurdles to clear before then. Level 5 is the highest level of vehicle autonomy as defined by the Society of Automotive Engineers (SAE). It refers to vehicles that can pilot themselves in all driving environments at all times with absolutely no input or oversight from a human. In many cases, concept level 5 autonomous vehicles don’t even include physical controls to permit a human to take over – instead, completely turning over the interior to passenger space. Level 5 may sound like an incremental step up from current semi-autonomous systems that can be bought today including Tesla’s own level 2 Autopilot system, but it is actually a very significant leap in terms of the complexity of the tasks it is required to handle. Currently, commercially available level 2 systems can navigate on highways or through traffic jams along with performing basic manoeuvres such as lane changing and entering/exiting a parking space. But they require constant oversight from a human driver because their safety cannot be guaranteed. Unlike level 2, level 5 vehicles must handle all those tasks safely enough to not require any human oversight. They must also tackle much harder driving environments such as bustling city centres, poorly lit country roads or driving in adverse weather conditions. These situations are orders of magnitude more complex for a self-driving system to handle due to the increased number of variables and unforeseen potential obstacles that may be encountered.
If you are in the US, in particular, you may have noticed Ford announced a new model this week. All 3,500 initial reservation slots for the most expensive launch version of the 2021 Ford Bronco in the US have already been taken, the investor website SeekingAlpha.com reported. The two-door model starts at US$59,305, nearly double the base Bronco’s price, and the four-door at $63,500. The report said the sales success was a good sign of demand for the retro SUV which is furthering Ford’s push into the off-road adventure category. The Bronco, of course, revives a nameplate Ford launched in 1965 and offered until 1996, and made (in)famous by the widely televised OJ Simpson freeway police chase in Los Angeles in June 1994. Ford, in fact, changed this week’s 13 July Bronco announcement date to avoid a clash with Simpson’s 9 July birthday after adverse publicity on social media. The revived model would contribute nearly US$1bn to Ford’s North American operations if sales reach 125,000 units, SeekingAlpha.com said. Good luck, Ford, it sure looks nice, is highly ‘personalisable’, and should wage a fine battle against FCA’s Jeep Wrangler.
FCA. What do you make of the new name? I could almost write a book on what was said on social media this week. As we reported: PSA and FCA have named the new group to be formed after their planned 50:50 merger ‘Stellantis’. The new corporate name for the merged entity – planned to be formed in Q1 2021 – will sit above the well known vehicle brand names in the marketplace. Stellantis is rooted in the Latin verb, stello, meaning to brighten with stars. “It draws inspiration from this new and ambitious alignment of storied automotive brands and strong company cultures that in coming together are creating one of the new leaders in the next era of mobility while at the same time preserving all the exceptional value and the values of its constituent parts,” said a PSA statement. “Stellantis will combine the scale of a truly global business with an exceptional breadth and depth of talent, knowhow and resource capable of providing the sustainable mobility solutions for the coming decades. “The name’s Latin origins pay tribute to the rich history of its founding companies while the evocation of astronomy captures the true spirit of optimism, energy and renewal driving this industry-changing merger.” The process of identifying the new name began soon after the combination agreement was announced and the senior management of both companies have been closely involved throughout, supported by Publicis Group.
Have a nice weekend.
Graeme Roberts, Deputy Editor, just-auto.com