AIADA's Top Task: Get to Know Biden's Team
The American International Automobile Dealers Association is spending the better part of 2021 getting acquainted with the Biden administration and bringing to Capitol Hill a number of issues important to dealers, reports Automotive News. "This is the first time we've had a four-year turnover in a while, so it's getting to know some of the new players and adjusting to how things will be run — a lot differently, I expect," said Cody Lusk, CEO of AIADA. Part two of its main priorities for the year involves sorting through early Biden-era policies and executive orders and making sure the group's roughly 9,500 members are operating safely through the coronavirus pandemic. "There's a lot of stuff going on, and we'll see what transpires," Lusk said. "But I don't find there will be any shortage of issues to cover for the dealers." Lusk, 52, spoke with Staff Reporter Audrey LaForest about his outlook for the industry under President Joe Biden and how auto retailing may change post-pandemic. Read more here (Source: Automotive News).
Hyundai, Kia Say Apple Car Deal Off; See $8.5 Billion Wiped Off Market Value
Reuters reports that South Korea’s Hyundai Motor Co said on Monday it is not now in talks with Apple Inc on autonomous electric cars, just a month after it confirmed early-stage talks with the tech giant, sending the automaker’s shares skidding. Wiping $3 billion off its market value, Hyundai’s stock slid 6.2%. Shares in its affiliate Kia Corp, which had been tipped in local media reports as the likely operational partner for Apple, tumbled 15% - a $5.5 billion hit. The announcement brings the curtain down on weeks of internal divisions at Hyundai Motor Co Group – parent to both automakers – about the potential tieup, with some executives raising concerns about becoming a contract manufacturer for the U.S. tech giant in a tieup reminiscent of electronics firm Foxconn’s role in making device for Apple like the iPhone. Read more here (Source: Reuters).
Nissan Presses on with Portfolio Overhaul, Despite Obstacles
At the same time Nissan has been juggling slumping sales, a corporate financial crisis, dealer dissatisfaction, and the pandemic, it also has been orchestrating an ambitious portfolio reboot in the U.S. to deliver 10 new or updated models in 20 months. Automotive News reports that Nissan is on the tail end of a bet-the-franchise move that will take its product portfolio from one of the industry's oldest to among its freshest. Its key sedan and truck models — including the Sentra, Rogue, Pathfinder, and Frontier — get redesigns. Pulling off the reboot in the maw of a pandemic, while also navigating a sales strategy pivot, has been a planning and logistics challenge, said Michael Colleran, Nissan U.S. senior vice president of sales and marketing. "It's really a remarkable story of recovery, perseverance, dedication and resilience," Colleran, 59, told Automotive News last week. Read more here (Source: Automotive News).
Focus on Chip Shortage Hurting Production as Japanese Automakers Report Results
Japanese automakers Toyota, Nissan, and Honda report third quarter results this week buoyed by recovering demand in China and the United States, but a global chip shortage has clouded their earnings outlook, reports Reuters. A surge in demand for electronics as more people stay home due to the coronavirus pandemic has led to shortages of semi-conductors, forcing the carmakers to cut production just at a time when sales have recovered more quickly than expected. Compatriots Subaru Corp and Mazda Motor Corp have cut production as well, as have other automakers including Volkswagen AG. “Chip shortage seems to have a larger impact on Japanese and Europeans as the shortage is mainly caused by NXP Semiconductors and Infineon,” said James Hong, an analyst at Macquarie Capital, adding that Korean rivals have a larger number of local suppliers and a healthier chip stockpile. The supply shortages were exacerbated by the previous U.S. administration’s actions to curtail technology transfers to China, which hit Chinese chip factories, as well as by a fire at a chip plant in Japan and coronavirus lockdowns in Southeast Asia. Read more here (Source: Reuters).
Cancel Culture: Kia Joins List of Manufacturers Backing Away from Sedans
The Detroit Bureau reports that barely a year after revealing a major update for the Cadenza line, Kia now says it’s pulling the sedan from its line-up, along with what had been the brand flagship, the K900. The South Korean carmaker joins a growing legion of manufacturers retreating from passenger cars or pulling out entirely. Just a few weeks ago, Volkswagen confirmed that it will stop selling the standard Golf model in the U.S., though the Golf R and GTI variants will remain in showrooms – for now. “An important part of our growth as a brand is our ability to understand market conditions and recognize our customers’ needs,” Kia said in a statement. “To that end, as the auto industry shifts its focus from full-size sedans to SUVs … the K900 and Cadenza will be discontinued for the 2021 model year.” Though the automaker had an otherwise solid January, overall U.S. sales up 11% compared to the year-prior period, Cadenza sales plunged 72%, to just 55 of the sedans. The K900 was off 23%, dealers delivering a mere 20 of them last month. Read more here (Source: The Detroit Bureau).
Around the Web
Cars Under $20K Are Becoming Endangered Species. Here Are a Few You Can Still Get [MarketWatch]
Someone Just Bought the Oldest New Car for Sale in the U.S. [Car and Driver]
Dealerships Look Outside the Industry to Resume Hiring, But Slowly [Automotive News]
German Cars Are the Most Expensive to Repair: Report [Jalopnik]
