Toyota Will Spend $3.4B Through 2030 to Make Automotive Batteries in the U.S.
Toyota Motor’s North American unit said Monday it will invest about $3.4 billion (380 billion yen) on U.S. automotive battery development and production in the United States through 2030, reports CNBC. The world’s largest automaker by volume also said it plans to establish a new company and build a new U.S. automotive battery plant together with Toyota Tsusho, the automaker’s metals trading arm and a unit of the Toyota Group. The new plant, which includes a planned $1.29 billion Toyota investment through 2031, aims to start production in 2025 and is expected to create 1,750 new U.S. jobs. The funds are part of the $13.5 billion it announced in September it planned to spend globally by 2030 to develop batteries and its battery supply system. The largest Japanese automaker said in September it aimed to slash costs of its batteries by 30% or more by working on materials used and the way the cells are structured. Toyota said the new company will initially focus on producing batteries for hybrid vehicles. Read more here (Source: CNBC).
Selling Cars in the Era of the Chip Shortage: Online Chats and No More Haggling
The global chip shortage has slashed vehicle inventories and left dealers with few cars to sell. It has also left car salesmen and women with less to do on the dealership lot. For those who remain, the job has been transformed both by pandemic restrictions and an accelerated shift to online buying, reports The Wall Street Journal. Salespeople who once spent days prowling dealership lots offering test drives now wrangle online leads and explain the chip shortage to frustrated customers. It hasn’t been all bad, dealers and salespeople say. Short inventories have curtailed haggling, and fewer sales employees means some are earning more money in the job, which typically pays between $40,000 and $60,000 annually, depending on commission. The new normal could last for years, because dealerships are running fine with fewer people, said Marc Cannon, executive vice president of Fort Lauderdale, Fla.-based AutoNation Inc. Read more here (Source: The Wall Street Journal).
Consolidation of Dealerships Unlikely to Cool
With dealership buy-sell activity heading for a likely record in 2021 as industry consolidation heats up, dealers and a dealer lawyer say the frenzied deal pace shows no signs of letting up heading into 2022, reports Automotive News. The flurry of transactions is happening as dealers weigh whether they should sell, given high store valuations and industry shifts on the horizon, or join the consolidation trend and acquire to get bigger, they said during an Automotive News Retail Forum: Dealer Discussions panel last week. Dealership consolidation has accelerated this year with several megadeals announced as public auto retailers buy some of the country's largest privately owned dealership groups. Lithia Motors Inc. in April bought Michigan's Suburban Collection, adding 34 stores. Group 1 Automotive Inc. plans to buy 30 stores from Prime Automotive Group by late November, Sonic Automotive Inc. plans to buy RFJ Auto Partners Holdings Inc. in December, and Asbury Automotive Group Inc. plans to buy Larry H. Miller Dealerships by year-end. Read more here (Source: Automotive News).
New Car Loans Are Easier to Get Now Than Cars
Finding a car may be harder than in recent memory, but shoppers who do line up a new vehicle are more likely to qualify for a loan, reports MarketWatch. Cox Automotive found access to loans in September was 5.5% easier than during the same period a year earlier. Generally speaking, credit access from banks, credit unions, and captive finance arms at automakers is nearly back to pre-pandemic levels. However, only automakers have loosened up loans to the level where consumers are just as likely to qualify in October 2021 as they were in February 2020 before the pandemic took hold of the global economy. That doesn’t mean car dealers are flush with vehicles, however. Inventory levels remain at historic lows with little change in sight as automakers struggle to source parts needed to assemble new vehicles. Supply chain bottlenecks, compounded by the global labor and computer chip shortage, make new cars challenging to locate. Similarly, discounts on new vehicles — as well as incentive and rebate spending from automakers — are few and far between. Some automakers are now offering unusual spiffs, such as credit for accessory items, in place of rebates. Read more here (Source: MarketWatch).
Volkswagen's Skoda Auto Halts Production for Two Weeks
Skoda Auto started a two-week outage on Monday as the carmaker contends with the global shortage of chips and other components, the Vokswagen-owned company said. According to Reuters, Skoda wants to complete 10,000 unfinished cars during the outage, which will leave only one production line running, a spokesman said. "Skoda Auto has been struggling with a big shortage of critical components, which has forced it to limit production significantly in the past weeks," spokesman Tomas Kotera said. Skoda, the Czech Republic's biggest exporter, said on Oct. 7 that it would "significantly reduce or even halt" production from Oct. 18 until the end of the year because of the global shortage of chips hobbling the automotive sector. The Czech Auto Industry Association on Sunday said that Czech carmakers will produce quarter of a million fewer cars than expected this year because of the global microchip shortage, costing the automotive sector 200 billion crowns ($9.14 billion) in sales. Read more here (Source: Reuters).
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