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The automated industry unites to fight Trump's proposed car prices



Art: Jason Torchinsky
The Morning Shift All your daily car news in one place. Isn't your time more important?

Car manufacturers fight back against President Donald Trump's import tariffs, slumping March new car sales, we get some insight into Nissan during Carlos Ghosn and so much more for The Morning Shift Friday 29. March 2019.

1. Gear: The automated industry is fighting against Trump's proposed automobile import tariffs

For at least a year now, Trump has been advocating a heavy-possibly 25 percent import tariff on foreign cars, and as Bloomberg reports in a new story, much of the automotive industry believes This is a bad idea, and some execs think it can "creep a sector that is already facing a slowdown."

There has been lots of pushback from the car manufacturers up to this point, but now they are strengthening their game. From the story:

Groups representing many arms in the industry – car manufacturers, dealers, sub-suppliers and aftermarket businesses alike – are barred from new fees being considered by the White House, a rarity for an industry that often disagrees with important policies.

The news thread spoke to Subaru of US President and CEO Tom Doll, who was one of a number of Authorization Representatives who flew to Washington DC to listen to a potential fare on imported cars and automotive parts. From Bloomberg:

"I came up specifically to talk to our congressmen about these rates and the impact they potentially have on our entire distribution chain, and how it will ultimately work itself through the distribution chain into our pricing," Doll in an interview with Bloomberg TV on Tuesday. "This is something we get a lot of sympathy from the congressional people, so we hope this will solve itself."

History discusses what impact proposed tariffs may have on car prices, and not just those imported from other countries:

A 25 percent tariff on all cars and parts can increase new car prices by an average of $ 4,400 on average, according to a 2018 study from the Center for Automotive Research. The prices of imported vehicles can rise by $ 6.875 per car, and US-produced cars can see a $ 2,270 bump, according to the report, estimated that more than 700,000 US jobs can get lost too.

According to the article, Trump will look at the trade department's recommendations on the matter, and while technically until May 18 to respond to a decision, it may take longer. So who knows how or when this whole car import tariff will shake off.

2. Gear: Trading Voltage Can Also Damage Car Sales

Every month, business analysts report car sales figures, and in March it finally comes, it seems that the figures may be down for the third straight month, Automotive News reports. The news page says that four forecasters have predicted falling between 1.5 and 7 per cent compared with March last year.

According to an analyst from Cox Automotive, trade policy uncertainty can help reduce sales. From Automotive News:

Analysts say the decline is due to an unresolved regulatory framework, as well as concerns that vehicles are becoming cheaper for consumers.

Cox said stock market volatility, uncertainty about President Donald Trump's trade policy and concerns about the potential for a financial downturn could be daunting by some would be buyers. It noted that continued price inflation in combination with long-term incentives may also hinder sales.

But another interesting factor may be the lower tax returns people have complained this year:

Another factor that potentially hinders sales: tax reform. Cox noted that the tax law that came into force last year had positive consequences in 2018, but has led to lower repayments for some consumers this tax period.

In other words, smaller refunds can dampen new car purchases. Gosh, I've heard many complaints about this year's tax return.

3. Gear: Ghosn's Nissan Sees Like A Shitshow

Now everyone knows about Carlos Ghosn, the exiled former Nissan-Renault boss, who is facing the trial in Japan, over alleged financial failure.

But if you want to read about what corporate culture and excitement between Renault and Nissan were like during his government, the New York Times describes the detailed show, writes:

Mr.. Ghosn was, as a critical governance report revealed this week, "deified within Nissan", a leader whose decisions and activities were "considered impenetrable territory in the company." He was known to drive out leaders who disagreed with him. He shared authority – and his plans – with just a few loyal leaders.

History continues:

Some of the division was promoted by Mr. Ghosn himself, former Nissan leaders have said in interviews. The result was a toothless board, internal guard dog without the authority to investigate senior executives and, according to Nissan's new leaders and former employees, an imperial business leader.

The environment was ripe for resettlement – and now Ghosn has said that is exactly what happened to him.

An important part of the article is the description of tensions between Nissan and Renault – two companies that some thought at once had been assembled to form a smooth-sailing corporate partnership. It is further complicated by the French Government's partial ownership of Renault.

Among the tensions, the story describes how some people in Nissan worried about the brand that loses its identity by sharing so many parts with Renault:

"Drive rod," said Tetsuji Isozaki, a former Union leader who worked at Nissan engine development team and is now a member of the Japanese Parliament, describing how blur began. "Then the transfer. Then the next and then the next, until it came to a place where the car's identity was at stake. Someone began to ask," Isn't that going so far? ""

It continues to describe Ghosn's role on Renault and Nissan:

"He made sure all parts of the organization depended on him to work," said Takeshi Yamagiwa, a business consultant in Tokyo who spent three decades at Nissan, where he led vehicle development. " came to a point where only one clone of Mr. Ghosn would succeed him. "

But Ghosn's strong leadership was the key to keeping the Renault-Nissan partnership together, and now the Times refers to that partnership as a" split alliance "that both companies are actively trying to get back from the brink.

And yet, merger negotiations are back, and perhaps with Fiat Chrysler at the table too. Color us skeptically.

4. Gear: Lift valued at $ 24 billion in IPO, but the company's outlook is not clear

The pledge filed for an initial public offer early in the month, and on Friday it plans to sell for $ 72 per share, bringing the company's valuation to around $ 24 billion.

But should investors go out and turn stocks into droves? Maybe not. The Wall Street Journal describes some of the company's challenges, writes:

Lyft, launched in 2012, says the service is now available to over 95% of the US population, but only 1% of miles traveled in the US on riding company network. This discrepancy may indicate a great market opportunity for lifting outside the urban areas. But the fact that the on-demand sharing concept has been available for nearly a decade of so few miles logged is not a particularly encouraging sign of value proposition across the broader market.

With that company losing a worrying amount of money, investors have to hope that revenue growth will be sustainable with less marketing costs or grow enough to compensate for bleeding. It also does not seem likely in the short term.

History continues and says that Lyft and Uber both spend a lot of money on marketing to compete with each other, and ultimately conclude that the payout is uncertain.

More about this from us later today.

5. Gear: Giant Auto Supplier ZF gets even more gigantic

ZF Friedrichshafen – the German auto parts supplier that employs 146,000 people worldwide and makes various powertrains and chassis parts, including transfers, not just for cars, but also for boats , vehicles, motorcycles, helicopters and even wind turbines – have just announced that the last 7 billion dollars have been acquired by the Swiss headquarters WABCO.

Westinghouse Air Brake Company, founded in 1869 in the United States, is known for its active safety systems on commercial vehicles such as automatic emergency braking, as well as for air suspension systems and transmission automation systems. ZF says in its press release that the purchase of WABCO would bring commercial brake competence to ZF's portfolio for the first time – a key area for ZF, as it wants to turn up its automated driving game.

From ZF:

ZF expects automated driving functions to be primarily implemented for vehicles and in areas of low complexity and traffic (eg factory sites, airports, agriculture). The combination of both businesses is expected to further accelerate the development of new technology to enable autonomous vehicle features, making the ZF less dependent on the economic cycle of the automotive industry.

The planned strategic acquisition of WABCO is in line with ZF's goal of developing and delivering technology solutions that allow vehicles and vehicles to look, think and act to reduce emissions and increase road safety. Although the ZF already has sensor systems and computer technology for its "see" and "thinking skills", WABCO ZF will in the future complete the commercial vehicle technology portfolio to provide solutions that allow vehicles to "act".

Conversely, General Motors CEO Rick Wagoner is asked to resign from Carpocalypse

Per Michigan's MLive news site:

General Motors Corp. Chairman and CEO Rick Wagoner will go down immediately at the request of the White House, the administration manager said Sunday. The news comes as President Obama is preparing to uncover further restructuring efforts to save the domestic automotive industry. The officials asked not to be identified because details of the restructuring plan have not yet been published. On Monday, Obama will announce measures to restructure GM and Chrysler LLC in exchange for additional government loans.

Neutral: Are you on board with fares?

When will a car price make sense in your eyes?


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