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GM will resume production at its San Luis Potosi and Ramos Arizpe plants in Mexico the week of May 31, and production is scheduled to resume later in June for CAMI Assembly plant in Ontario and Lansing Grand River in Michigan, following shutdowns caused by the semiconductor shortage.
Due to the semiconductor shortage, Nissan announced downtime during unspecified dates in June for three plants in Mexico, and Stellantis will shut down its Toluca, Mexico, plant the week of June 7.
The auto industry needs to consider alternatives to the just-in-time manufacturing approach for certain key components such as semiconductors, according to Bloomberg.
The Biden administration signaled that it will act without Republican support if a bipartisan deal on infrastructure is not reached when Congress returns the week of June 7 after its Memorial Day break.
The Senate is scheduled to vote June 8 on a bipartisan bill that would invest $52 billion to bolster the semiconductor industry in the U.S. as part of a package to strengthen the nation’s competitive position.
Automakers, including BMW, Daimler and Ford, have established facilities in China to store data generated by vehicles locally in anticipation of increased regulatory scrutiny in the nation.
Fordannounced a new business unit, Ford Pro, as part of an initiative to increase revenue from its commercial business to $45 billion by 2025, from $27 billion in 2019.
Electric vehicles and low emissions technology:
Ford intends to investover $30 billion in EVs by 2025, up from $22 billion committed earlier this year, and 40% of its global production volume will be electric by the end of the decade. EVs represented 1.2% of Ford’s U.S. sales through April, and the automaker’s future electrification strategy emphasizes its most iconic brands, such as the Mustang, the F-Series and the Transit van.
J.D. Power and LMC Automotive forecast total new vehicles sales in the U.S. to reach 1.55 million units in May, representing a 39.6% increase from May 2020 and a 1.9% decrease from May 2019.The seasonally adjusted annualized rate (SAAR) for total new-vehicle sales is projected to be 16.7 million units. The same forecast predicts that U.S. retail sales could set a record for the month, while noting the risk of low inventory “is still the primary threat to maintenance of the current sales pace in the coming months.” Cox Automotive predicts U.S. new light vehicle sales of 1.54 million in May, representing a SAAR of 16.5 million units.
Senate Republicans have revealed a $928 billion infrastructure plan as a counteroffer to the White House’s most recent proposal that offered a potential package of $1.7 trillion. Democratic senators indicated they will pursue an infrastructure package “with or without the support of Republican senators.”
A bipartisan bill that would invest $52 billion to bolster the semiconductor industry in the U.S. is scheduled for a final vote on June 8.The potential funding is part of a proposal now referred to as “The U.S. Innovation and Competition Act,” which is intended to strengthen the nation’s position in science and technology to better compete with nations such as China.
The Senate Finance Committee will advance a $259.5 billion package of clean energy tax credits that include consumer incentives of up to $12,500 for EVs that retail for up to $80,000 if they are assembled in the U.S. at union-represented plants. The legislation faces Republican opposition due to its high costs and intent to end tax incentives for fossil fuels. There is also speculation the Clean Energy for America Act ultimately may not receive a full vote in the Senate, but elements of the proposal could be incorporated into another package.
The semiconductor industry in Taiwan could be negatively impacted by a shortage of COVID-19 vaccines in the nation; it’s estimated that only 1% of the population has been vaccinated. Taiwan is responsible for manufacturing over half of the global supply of semiconductors. Japan is reported to be considering sharing part of its stockpile of AstraZeneca vaccines with Taiwan and other countries.
Production cuts caused by the semiconductor shortage – Nissan’s Aguascalientes Plant 1 and its CIVAC plant in Morelos state will each shut down for seven days in June, with specific dates not provided, and the automaker’s Aguascalientes Plant 2 will also shut down for one day in June. Stellantis will shut down its Toluca plant the week of June 7.
GM will resume production at five of its plants following production shutdowns caused by the global semiconductor shortage. Its San Luis Potosi and Ramos Arizpe plants in Mexico are scheduled to resume production this week; the plants have been down since the weeks of May 17 and May 3, respectively. CAMI Assembly plant in Ontario will resume production June 14, after downtime since February. Lansing Grand River in Michigan resumes Camaro production June 21; however, Cadillac CT4 and CT5 production at this plant will remain down through the week of June 28. Bupyeong 1 Assembly in Korea resumes production May 31, after operating at 50% capacity since the end of April.
A grand jury in Texas was impaneled in relation to a Foreign Corrupt Practices Act investigation into Toyota over allegations the automaker bribed Thai judges to overturn a $350 million tax judgment.
GMwill partner with Lockheed Martin to develop lunar terrain vehicles capable of carrying astronauts and equipment for longer distances on the moon. GM’s area of focus will be expertise in battery-electric and autonomous vehicle technologies. The automaker has previously provided support for the Apollo moon program.
A recent editorial in Crain’s Detroit Business notes that within the automotive sector, suppliers will face the biggest disruptions and opportunities from the automotive industry’s transition to vehicle electrification.
Connected/Autonomous Vehicles and Mobility Services
The Tesla Model 3lost its Consumer Reports ‘Top Pick’ ranking after the company announced it would no longer have radar. Tesla is removing radar from its Model 3 and Model Y cars, relying entirely on visual sensors. This means it will temporarily deactivate some of the cars’ advanced safety features, resulting in the Model 3’s downgrade to ‘recommended’ by the magazine.
According to a recent article in The New York Times, fully autonomous vehicles could potentially require several decades of development before the technology is widely available, at a cost of billions in capital spending per company.
U.K.-based auto data developer Wejo will go public through a reverse merger with blank-check company Virtuoso Acquisition Corp. The deal will raise $330 million in proceeds for Wejo, and is expected to close in the second half of the year. Wejo’s clients include GM, Hyundai and Daimler.
Electric Vehicles and Low Emissions Technology
During its Capital Markets Day presentation last week, Ford announced it will increase EV spending to reach over $30 billion by 2025, from the previous goal of $22 billion, and set the target to reach a 40% global production mix of BEVs by 2030.According to the presentation, one-third of Ford’s full-size pickup segment will be fully electric by 2030 (800,000 units annually); as well as 70% of full-size vans and buses (300,000), and all of its European passenger cars. Ford hopes to have battery costs under $80/kwh by the end of decade, down from $140/kwh currently. Following the event, the automaker’s share price was up by 8.5%, reaching $13.90 in afternoon trading.
Separately, Fordannounced it would change the name of its Van Dyke Transmission Plant in Sterling Heights, Michigan, to the Van Dyke Electric Powertrain Center, to signal the automaker’s transition to electrified vehicles.
Lordstown Motorsexpects a 50% reduction in 2021 production volumes for the upcoming Endurance electric truck. The reduction was attributed to the need for more capital, as well as the negative impact of COVID-19, industrywide supply chain constraints, and “significantly higher than expected” spending on parts and expedited shipping.
GM and LG Energy Solutionrecognized workers’ rights to unionize at the companies’ upcoming Ultium Cells LLC battery plants in Ohio and Tennessee. The joint venture sites will employ an estimated 2,300 workers when fully operational.
Toyotadebuted a prototype hydrogen-burning engine in its Corolla H2 concept at Fuji Speedway May 22-23.This concept vehicle burns compressed hydrogen in a piston engine. Toyota does not have a timeline for mass production, but the automaker has previously signaled its emphasis on hybrid vehicles as an important tool to achieve carbon neutrality.
Prepared by Julie Dautermann, Competitive Intelligence Analyst
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