Volvo Leaves U.S. Dealers Confused on Plans
Volvo's ambitious plan to pivot to a digital-only sales model could stall in the U.S. as some retailers balk at what they see as a factory assault on the franchised dealer model, reports Automotive News. The Swedish automaker this month announced plans to become an all-electric brand globally by 2030. To sell those vehicles, Volvo wants to use an online-only, factory-set price sales model — borrowing aspects of a strategy pioneered by Tesla that has become a template for a wave of electric upstarts. But dealer associations in two states — Virginia and California — have sent letters to Volvo warning it that the strategy might violate the automaker's dealer agreements or state laws meant to prevent automakers from competing with their franchises. The Texas dealer association is now seeking clarification from Volvo on the plan. Read more here (Source: Automotive News).
Transactions Surge as Buy-Sell Boom Rolls On
A fourth-quarter surge in the number of U.S. dealerships sold led to one dealer buy-sell adviser declaring 2020 a record year for transactions. And several experts expect the accelerated pace of stores changing hands will continue in 2021, reports Automotive News. Prices are rising, and while that's a boon for sellers, potential buyers such as dealer Scott Biehl have to factor in higher costs as they consider whether to acquire more stores. "Prices are going up, I think, every day," said Biehl, CEO of Triunity Automotive Group of Fresno, Calif., which acquired its second franchised dealership in January, a Jaguar-Land Rover store in West Hollywood, Calif., from Pendragon. Kerrigan Advisors, a sell-side firm in Irvine, Calif., counted a record 289 dealership transactions — deals that included a single store or multiple stores — for 2020 in its year-end Blue Sky Report. That pace was up 24 percent from 2019, and it included 103 deals that closed in the final three months of the year as profits soared. Read more here (Source: Automotive News).
Auto Industry Could Take on Water Due to Suez Canal Crisis
The grounding of mega-carrier Ever Given in the Suez Canal over the last week has halted traffic through one of the world’s busiest waterways — and the crisis threatens to compound the problems facing an industry already struggling to overcome supply chain issues, reports The Detroit Bureau. The Taiwanese-owned ship, capable of carrying up to 20,000 individual cargo containers, ran aground March 23 and shipping experts warn it could take “weeks” before it is freed up. The grounding brought traffic through the Suez Canal to a halt, including a number of car carriers as well as cargo vessels and tankers carrying auto parts and raw materials. The crisis comes at a particularly bad time, automakers worldwide already facing shortages of critical semiconductors and petroleum-based materials like seat foam. That has led to numerous plant closures in recent weeks, a situation that the canal crisis could worsen, experts warn. In turn, consumers could be looking at both higher prices and shortages of some popular products if the canal can’t reopen soon. Read more here (Source: The Detroit Bureau).
Hyundai Motor to Suspend Production in South Korea Due to Chip Shortage
Reuters reports that South Korea’s Hyundai Motor Co plans to temporarily suspend production at its Ulsan No.1 plant in South Korea due to chip shortage between April 5 and April 13, Korea Economic Daily reported on Monday, citing the auto industry. The affected Ulsan factory produces 311,000 vehicles annually including the Kona Electric and Ioniq 5. “No decision has been made on the reported temporary suspension of the facility,” Hyundai said in a statement to Reuters. The Korea Economic Daily said the production at Hyundai’s Ulsan No.1 plant is being suspended due to supply issues regarding chips and power electric modules. Underscoring the severity of the chip shortage crisis, Hyundai, until recently one of the automakers least affected due to prudent stockpiling, has become the latest automaker to halt manufacturing due to the chip shortage. Hyundai had been able to avoid a hit from the shortage so far largely because it maintained a stockpile of chips unlike its global peers, Reuters reported last month. Read more here (Source: Reuters).
Great Wall Bets on Hydrogen, Will Use to Power New SUV
Great Wall Motor Co., China’s biggest maker of sport-utility vehicles, plans to roll out its first hydrogen-powered SUV this year, reports Bloomberg. The company will also deploy its hydrogen-powered cars during the Winter Olympics in China next year, Zhang Tianyu, head of FTXT Energy Technology Co., a Great Wall subsidiary, said in the city of Baoding on Monday during a media briefing to outline the automaker’s hydrogen strategy. Great Wall has invested 2 billion yuan ($305 million) over the past five years to develop hydrogen power-related technologies that can be used for vehicles as well as marine and rail transport, Zhang said. Founder Wei Jianjun added that Great Wall will invest another 3 billion yuan over the next three years and plans to become a top-three seller of hydrogen-powered automobiles by 2025. “Development of the hydrogen-related industry will move forward as quickly as that for electric vehicles,” Wei said. Read more here (Source: Bloomberg).
Around the Web
Porsche Puts Taycan EV in Its Subscription Fleet [WardsAuto]
VW to Seek Damages from Former Executives for Diesel Scandal [The Detroit News]
Genesis Again Hints That It's Working on an EV Sports Coupe [Autoblog]
