Japan Auto Group 'Profoundly Disappointed' by Trump's Import Stance
Automotive News reports that the Japan Automobile Manufacturers Association said it is "profoundly disappointed" by U.S. President Donald Trump’s declaration that imported vehicles and parts threaten national security, echoing a statement made just days ago by Toyota Motor Corp. "We are dismayed to hear a message suggesting that our long-time contributions of investment and employment in the U.S. are not welcomed," Toyota President Akio Toyoda said in a statement Tuesday. "As chairman, I am deeply saddened by this decision." Such language is unusual for Japanese companies, and reflects growing concern that Trump may trigger an all-out trade war ahead of U.S. elections next year. "Any trade restrictive measures would deliver a serious blow to the U.S. auto industry and economy, as it would not only disadvantage U.S. consumers, but also adversely affect the global competitiveness of U.S.-produced vehicles and suppress company investments in the U.S.," Toyoda said. Read more here.
3 Senators Question Delay on Volkswagen Tennessee Union Vote
Three Democratic U.S. senators are expressing concerns about delays to an election over whether Volkswagen maintenance and production workers in Tennessee should unionize, reports The Detroit News. Sens. Sherrod Brown of Ohio and Gary Peters and Debbie Stabenow of Michigan sent Volkswagen Group of America CEO Scott Keogh a letter Tuesday. It says any election delays further enable anti-union campaigns to target and intimidate workers. Volkswagen says it’s neutral on the possible Chattanooga unionization, respects the right to decide representation, and will respond to the letter. The senators question Volkswagen’s neutrality, saying they’ve heard Chattanooga supervisors are having anti-union conversations with workers. Earlier this month, the National Labor Relations Board indefinitely delayed election procedures in Chattanooga at Volkswagen’s request. Read more here.
Auto Industry Cutting Jobs at the Fastest Pace Since the Financial Crisis
Automakers are laying off employees at the fastest pace since the financial crisis, according to outplacement services company Challenger, Gray & Christmas Inc., as the industry struggles with evolving consumer demand and new technology-based competition. MarketWatch reports that the industry has announced 19,802 in workforce reductions this year through April. That’s more than triple — up 207 percent — than the 6,451 jobs cuts announced during the same time last year, and the most for the first four months of a year since 101,036 cuts were announced through April of 2009, according to data provided by Challenger, Gray & Christmas. Both Chrysler and General Motors filed for bankruptcy in 2009, Chrysler in April and GM in June. Add to that Ford Motor Co.’s announcement on Monday that it planned to eliminate 10 percent of its salaried workforce, or about 7,000 jobs, by the end of August, with notifications being sent out on Tuesday. Ford said the move is aimed at reducing its management structure by close to 20 percent. Read more here.
Automakers Still Looking for Top Price on Full-Size Pickups
Truck sales are booming, which is good news for automakers since they result in big profits. Only adding to their bottom-line delight is that the fastest growing area are the highly profitable “luxury” trucks with price tags zipping past $60,000, reports The Detroit Bureau. New full-size trucks in 2018 were 16 percent more expensive than those in 2015, and midsize trucks were 3 percent more expensive, according to CarGurus.com. In fact, the top end of the market has trucks passed the $80,000 mark, and the good news is that there is probably room for even more expensive pickups, according to one truck executive. GMC just introduced its new 2020 model year Sierra 1500 and, while not revealing pricing, has at least two models that either approach or exceed the $60,000 mark. Trucks pushing $80K are usually heavy-duty models, but the advances in safety and infotainment technology are pushing prices up for trucks across the board. Read more here.
Jeff Bezos Tells Employees He's 'Very Excited' About the Auto Industry
CNBC reports that at an all-hands staff meeting in March, Amazon CEO Jeff Bezos told employees that he’s fascinated by the recent developments in the auto industry, adding that it was one of the main reasons why Amazon led a $700 million investment in electric vehicle start-up Rivian in February. “If you think about the auto industry right now, there’s so many things going on with Uber-ization, electrification, the connected car — so it’s a fascinating industry,” Bezos said according to a recording of the meeting CNBC has heard. “It’s going to be something very interesting to watch and participate in, and I’m very excited about that whole industry.” Bezos’ comments give a rare glimpse into his interest in the auto industry, which Amazon entered in February through its investments in Rivian and another self-driving tech start-up, Aurora. Rivian is best known for its electric trucks and has raised $1.4 billion in funding so far, including $500 million from Ford in April. Aurora, a self-driving tech start-up run by former Uber, Google, and Tesla executives, is now reportedly worth more than $2 billion following its $530 million funding round in February. Read more here.
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