Subaru to Cut U.S. and Japan Output, Citing Chip Shortage

First Up 01/14/21

Subaru to Cut U.S. and Japan Output, Citing Chip Shortage

Subaru Corp. will cut output by "several thousand" vehicles this month in Japan and the United States, it said Thursday, citing a global shortage of semiconductors, reports Automotive News. Subaru will adjust production and reduce output at factories in Gunma, Japan, a company spokesman said without specifying exactly how many fewer cars will be made. The company later said that factories in Gunma will be halted temporarily for two days starting Friday because of supply constraints. Subaru will also reduce output at its Indiana plant, the spokesman said, adding that the company is examining whether further production cuts will be needed in February. Global automakers have been hit by a scramble for semiconductors as demand rebounds from the coronavirus crisis. Subaru rival Nissan Motor Co. plans to reduce production of the Note, a hybrid electric car, at its Oppama Plant in Kanagawa prefecture, Japan, while Honda Motor Co. said on Jan. 8 that its domestic output could be affected by a shortage of chips. Volkswagen, Toyota Motor Co., Ford Motor Co. and Fiat Chrysler Automobiles are among automakers who have had to adjust production because of the chip shortage. Read more here (Source: Automotive News). 

Auto Sales Gain Traction as Americans Avoid Mass Transit

Taxi business in New York City has dropped by 90% since the start of the pandemic, even as mass transit ridership has fallen precipitously, reports The Detroit Bureau. The situation, repeated across the country, reflects a variety of factors, including a huge increase among those working from home and a sharp decline in business travel. But even among those who must commute, there’s been a sizable shift away from mass transit and ride-hailing services to the use of personal vehicles. And that is leading not only to a surge in car sales, both new and used, but also in the type of vehicles American motorists are purchasing. Among new car buyers, in particular, motorists are ordering vehicles loaded with the latest in high-tech features, from smart safety devices to infotainment systems, as well as in-car WiFi and other technology, members of an expert panel agreed during a session at the virtual CES 2021. Read more here (Source: The Detroit Bureau).

Automakers Join Advisory Group to Speed Electrification Efforts

Ford Motor Co., General Motors, Kia, and Volvo are among 17 companies that have joined a new strategic advisory group that will support the deployment of EVs and charging infrastructure in the U.S., reports Automotive News. The Electrification Coalition Business Council was formed Wednesday in partnership with the nonpartisan group Electrification Coalition. The two groups will work "to advance policies and programs that support the deployment of electric vehicles and charging infrastructure on a mass scale in order to overcome the economic, public health and national security challenges associated with the American transportation sector's dependence on oil," according to a news release. "The United States' transition to an electrified transportation future isn't a question of if — it's when," Ben Prochazka, national director of the Electrification Coalition, said in a statement. The council "creates a strategic alliance that can supercharge support for the policies and actions needed to accelerate transportation electrification at a mass scale." Read more here (Source: Automotive News). 

Expect a Rebound in Used-Vehicle Sales This Year and Beyond

Auto Remarketing reports that after a downturn in 2020, the used-car market is expected to kick off a multi-year rebound in sales, with numbers expected to eclipse the 40 million mark in 2022, say analysts with Cox Automotive. According to Friday's Cox Automotive Industry Insights 2021 presentation, there was an estimated 36.7 million total used-vehicle sales in 2020. While that’s down from 40 million in 2019, Cox Automotive is projecting used sales to climb to 39.3 million this year and 40.2 million next year, before moving down slightly to 39.8 million in 2023. Cox Automotive estimated that used-car retail sales (those involving a dealer) fell from 20.8 million in 2019 to 19.5 million last year. But those used retail numbers are expected to climb to 21.2 million sales this year, 22.1 million in 2022 and 22.4 million in 2023. Read more here (Source: Auto Remarketing). 

U.S. Asks Tesla to Recall 158K Vehicles for Touchscreen Failures

The National Highway Traffic Safety Administration (NHTSA) on Wednesday asked Tesla Inc to recall 158,000 Model S and Model X vehicles over media control unit (MCU) failures that could pose safety risks by leading to touchscreen displays not working, reports Reuters. The auto safety agency made the unusual request in a formal letter to Tesla after upgrading a safety probe in November, saying it had tentatively concluded the 2012-2018 Model S and 2016-2018 Model X vehicles “contain a defect related to motor vehicle safety.” Tesla did not immediately respond to a request for comment but it must respond to NHTSA by Jan. 27. If it does not agree it must provide the agency “with a full explanation of its decision.” It is unusual for the agency to formally demand a recall. Automakers typically voluntarily agree to a recall if sought in discussions by regulators. The agency said it sought the recall after considering “Tesla’s technical briefing presentation ... and evaluated Tesla’s assertions.” Read more here (Source: Reuters). 

CNA National Celebrates 26 Years with AIADA

This month CNA National marks its 26th anniversary as AIADA’s longest-serving Affinity Partner. Since 1995, this relationship has benefited AIADA members by offering them F&I solutions specifically designed to increase dealers’ profitability and exceed buyers’ expectations. CNAN has also set the standard for claim service excellence, as reflected in its selection as a top provider for 16 consecutive years in the Dealers’ Choice Awards. “CNAN has been an industry leader for almost 40 years, and we are proud to be the preferred provider for AIADA,” said CNAN president and CEO Joe Becker. “Our company is well known for delivering superior service and has never wavered in our dedication to our dealers and their customers.” To learn more, call 800-345-0191 x 450 or connect with CNAN online.

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