Calif. Governor Signs Dealer Franchise, Data Privacy Legislation
California auto dealers will be able to recoup costs for warranty and recall work at rates closer to what retail customers pay, after Gov. Gavin Newsom signed an update to the state's dealer franchise law. According to Automotive News, Newsom on Saturday signed AB 179, changing the rate that automakers use to reimburse franchised dealers for recall and warranty parts and labor. The change was sought by the California New Car Dealers Association, which contends dealers generally can receive close to 40 percent less from automaker recall or warranty repairs than they can collect from retail customers. The dealer franchise law updates also prevent automakers from requiring dealers to upgrade their facilities within a decade of the last improvement and allow dealers to challenge automakers' performance standards before the state's New Motor Vehicle Board. Newsom also signed into law AB 1146, which carves out an exception to a new state data privacy law set to take effect in January so that automakers and dealers can notify customers about warranties or recalls. Read more here.
Toyota Plans 10-Fold Boost to Hydrogen Bet with Restyled Sedan
As other automakers plan battery-powered crossover SUVs and trucks, Toyota Motor Corp.’s vision for the future of driving remains a hydrogen-sipping sedan, reports The Detroit News. The automaker will begin sales late next year of the second-generation Mirai, its fuel cell-powered four-door, and ramp up annual production by 10-fold from the current model. Toyota’s bet that it can position a hydrogen sedan for more of a mass market flies in the face of rivals wagering on putting batteries into the bigger-bodied vehicles consumers are buying. Toyota has been slower than peers to embrace EVs, citing uncertain demand in key markets including the U.S. and technical hurdles that limit battery range and recharging times. While the company has pledged to offer an electrified version of every model in the next five years, and 10 fully electric vehicles by early the next decade, it’s also going to keep coaxing consumers to give hydrogen a try. Read more here.
UAW Strike Has Now Cost $2B, 'Could Bring GM to Its Knees,' Bank of America Says
The strike by General Motors workers has cost about $2 billion through the first four weeks, Bank of America estimated, saying that the beginning of week five means “everyone hurts.” CNBC reports that in a note to investors on Tuesday, Bank of America analyst John Murphy wrote, “A prolonged strike could burn significant cash and bring GM to its knees, but investors likely will also react negatively if management is perceived to have caved into labor’s demands and GM’s long-term competitiveness is threatened.” The strike by the United Automobile Workers union (UAW) is costing GM about $100 million in lost earnings before interest and taxes per day, Bank of America estimated. The firm also noted that the total lost profit has cost each GM worker as much as $4,000 in net take home pay. Negotiations are continuing between UAW leaders and GM. The union summoned local leaders to Detroit to meet this coming Thursday, for an update on the negotiations. Read more here.
Sedan is Still Top Choice Among Minority Buyers
Cars are still outpacing crossovers in popularity among minority consumers, and African Americans are a fast-growing segment of pickup buyers. Those are two revelations in IHS Markit registration data for the first half of 2019 that have significant implications for automakers as demographic shifts position ethnic and racial minorities to represent more than half of the U.S. population by 2042, reports Automotive News. IHS Markit Chief Diversity Officer Marc Bland, who has warned the industry in the past about basing its advertising to minority audiences on outdated assumptions, has spotted several trends that can guide manufacturers. For one, Bland said cars are not dead. Secondly, three pickups are among the 10 most popular vehicles among African Americans. "The industry has been marketing pickups to Hispanics for a long time. But what's new is that African Americans have this newfound, very strong affinity for pickup trucks," Bland told Automotive News. Asian Americans, Bland said, could be the next growth opportunity in the pickup scene, so automakers should create truck campaigns that speak to those consumers. Read more here.
VW's U.S. CEO Has Seen the Future and It's All About SUVs and BEVs
Few brands had the “cool” factor of Volkswagen back in the 1960s, when products like the Beetle and the Microbus won over millions of American buyers, young and old. According to The Detroit Bureau, the German automaker is hoping to rebuild its hip brand identity with an array of new SUVs and BEVs set to roll out during the next several years, Volkswagen Group of America CEO Scott Keogh said. While it’s far too early to tell how battery-electric vehicles like the ID Buzz microvan will fare in the market, there are signs that VW is regaining some of its luster. The automaker has defied the overall downturn in the U.S. market this year largely due to its expanding line-up of utility vehicles. Read more here.
Around the Web
McLaren 620R Spied Looking Cooler Than the Race Car [Autoblog]
5 Years of Change: It's a Wild Ride in the Auto Industry [Automobile]
Lamborghini Review Marks Step in VW's March to $220B [Bloomberg]
