Tesla, Toyota Spar with Ford, UAW Over EV Tax Bill
Toyota Motor Corp and Tesla clashed with Ford Motor Co and the United Auto Workers (UAW) union over a proposal by Democrats in the U.S. House to give union-made, U.S.-built electric vehicles an additional $4,500 tax incentive. Reuters reports that in a letter to Congress, Toyota said the plan discriminates against nearly half of American autoworkers who do not belong to a union and called on lawmakers to reject giving "exorbitant tax breaks" to wealthy buyers of high-priced cars and trucks. The bill, set to be taken up on Tuesday by the House Ways and Means Committee as part of a proposed $3.5 trillion spending bill, would benefit Detroit's Big Three automakers, which assemble their U.S.-made vehicles in UAW-represented plants. The proposal boosts the maximum tax credit for these electric vehicles to $12,500 - including a $500 credit for using U.S.-made batteries – from the current $7,500, which stays the same for all others. The bill also does away with phasing out tax credits after automakers hit 200,000 electric vehicles sold, which would make GM eligible again, along with Tesla Inc, although Tesla would not receive the higher credit. Read more here (Source: Reuters).
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Group 1 to Buy 30 Prime Automotive Stores for $880 Million
Public auto retailer Group 1 Automotive Inc. said Monday that it has agreed to acquire Prime Automotive Group, one of the largest privately owned dealership groups in the U.S. Automotive News reports that Group 1 said the $880 million purchase includes nearly all of Prime's assets, 30 stores, three collision centers and real estate. It said the platform of stores last year generated $1.8 billion in annual revenue and the stores sold more than 52,000 new and used vehicles. The acquisition of Prime, based in suburban Boston, will significantly boost the store count for Group 1, particularly in the Northeast. A closing is slated for late November. The Group 1-Prime transaction would be the second megadeal of the year for dealership buy-sells. In April, Lithia Motors Inc. bought Michigan's Suburban Collection, a group of 34 stores and 56 franchises. Read more here (Source: Automotive News).
Sales to Suffer While Chips Are Down, Cox Analyst Says
The “dreadful” sales figures for August probably won’t get much better through the end of 2021 and into the first half of 2022 because inventory shortages tied to computer-chip scarcity and the rise in coronavirus cases will persist, says Charlie Chesbrough, senior economist for Cox Automotive. “The concern now is that sales are completely restrained by inventory,” Chesbrough says in a Sept. 9 online presentation sponsored by AIADA. WardsAuto reports that the seasonally adjusted annual rate for total August light-vehicle sales was just 13.1 million, he says, and it was the fourth month in a row the SAAR declined from the previous month. The SAAR is an estimate of what sales would be for the full year at the current monthly sales pace. “That really surprised folks,” Chesbrough says of the low August SAAR. He admits Cox Automotive was surprised, too. The firm had predicted a SAAR in the low- to mid-14-million range for August. Read more here (Source: WardsAuto).
Green Steel Becomes a Hot Commodity for Big Automakers
Automakers are racing to find cleaner steel to build their cars, reports The Wall Street Journal. The industry’s approach ranges from low-tech—using more recycled steel—to less-proven methods, including trying to source the metal from hydrogen-powered mills instead of more conventional coal-fired ones. The steel industry is one of the world’s biggest emitters of carbon dioxide, and the auto sector is one of the largest users of steel. Steelmakers are seeking ways to produce their steel more cleanly. Automakers—pushed by regulators, investors and climate-conscious customers—are joining that search. European car makers and steelmakers are moving faster to develop and use lower-carbon steel, analysts say. Earlier this month, Daimler AG’s Mercedes-Benz signed a deal with Swedish steelmaker, whose Hybrit unit will produce low-carbon steel for the auto company beginning next year. Read more here (Source: The Wall Street Journal).
These Are the Cars and SUVs You Still Can Lease for Less Than $200 a Month
With production lines being halted because of the lack of key components, new-vehicle sales, which had been gaining steam after being curtailed by a period of COVID-19-related shutdowns, dropped by around eight percent last month. One solution is to lease a new model for two or three years until the industry’s manufacturing problems settle down and prices stabilize. Forbes uncovered a healthy list of new cars and SUVs that are being offered for less than $200 a month with nominal cash due at signing. The most-affordable lease Forbes could find that’s valid through the end of the month is on the full electric Nissan leaf, which is going for a mere $110 in the Northeastern part of the country, though with a fairly steep down-payment. Read more, and check out the list, here (Source: Forbes).
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