Hyundai is pumping a bunch of money into its U.S. plants, the United Auto Workers is imploring General Motors to “take the high road” with organization at its new battery factories, and despite what you may think, Aston Martin says you don’t need manuals anymore. All this and so much more in this Friday edition of The Morning Shift for May 14, 2021.
1st Gear: You Name It, Hyundai’s Throwing Money At It
You see, these electric automobiles are a big deal, and Hyundai’s got a few in the works, like the Ioniq 5, Kia’s EV6 and a bunch we haven’t seen yet. On Friday, the South Korean automaker announced a plan to invest $7.4 billion in its U.S. production operation by 2025 to build them here.
But it’s not all about EVs for Hyundai — it’s still big into the whole hydrogen thing, too. From the company’s press release:
Hyundai Motor Group looks forward to working with the U.S. government and other business partners to expand the U.S. hydrogen energy ecosystem. The Group is committed to fostering a hydrogen society to create new business opportunities for a sustainable future.
Hyundai Motor Group signed an MOU with the U.S. Department of Energy in February 2020 to cooperate in hydrogen fuel cell technology innovation and global expansion. This included the installation of a hydrogen refueling station and providing NEXO SUVs.
Later this year, Hyundai will proceed on demonstration project in preparation for commercialization of fuel cell electric trucks. Hyundai Motor will also work with local partners to conduct a hydrogen refueling demonstration project for fuel cell electric trucks. and provide logistics between port and inland warehouses by utilizing fuel cell electric trucks.
It’s funny that while some automakers are waffling on whether to go all in on EVs or hedge their bets with plug-in hybrids, or maybe take a stab at hydrogen, Hyundai is here for all of it. Fuel cells don’t make a ton of sense for passenger cars, but they may be a viable solution to curtail emissions for commercial diesel vehicles. But of course, the infrastructure has got to be there first. Ain’t that always the catch?
2nd Gear: This Is What The Chip Shortage Is Costing The Auto Industry
$110 billion. That’s the revenue the automotive sector will have lost by the end of the year as a consequence of the ongoing semiconductor shortage, according to consultancy firm AlixPartners by way of the Detroit News.
That’s a lot of dough, but in case you need a rather disturbing analogy to fully grasp how bad it is out there:
“These (chip) plants are running full out,” said Dan Hearsch, a managing director in AlixPartners’ automotive and industrial practice. “There’s nothing to absorb the shocks, there’s no additional capacity, there’s no additional inventory ... all of the cushion has been taken out and you’re running on knees with no cartilage.”
In terms of vehicles, AlixPartners estimates this would translate to 3.9 million fewer cars produced by year’s end. But it’s not just about silicon; metals and foam are hard to come by, the key Renesas chip-making plant in Japan went up in flames earlier this year and the devastating winter storm that hit Texas particularly hard back in February set things back, too.
The industry is also reckoning with all of this to get new cars onto dealer lots, while used ones are drying up and getting more expensive, too. Welcome to 2021, where everything’s running out and supply chains don’t matter.
3rd Gear: UAW, GM Set To Face Off Over Battery Plant Unions
GM has two new battery production plants in the works — one in Lordstown, Ohio and the other in Spring Hill, Tennessee. They’re the product of a joint venture with LG Energy Solutions to build batteries, called Ultium Cells, LLC, and they’re expected to start activity in 2022 and 2023, respectively.
As a joint venture, however, the employees GM hires to work at these plants won’t automatically be represented by the United Auto Workers union. GM has said the workers will vote on whether to organize and has pledged not to interfere, but just in case it does, the UAW has issued a warning. From the Detroit Free Press:
“CEO Mary Barra and General Motors have the ability to recognize the union through a card check, not a flawed NLRB election, and recognize a wage that is comparable to what we have at our engine plants,” Estrada said. By not doing so, “GM is talking very differently from Biden when he said the EV jobs should be higher wages and union represented.”
An hourly worker at a GM engine plant currently can earn more than $31 an hour, Estrada said, versus what’s expected to be a $15 to $17 an hour wage.
GM can still “take the high road and say, ‘We’ll have card check, management neutrality and we will make these high-wage jobs,’” Estrada said. “If they choose the low road, we’re going to fight very strongly against that and so will our workers and our future workers because it’s bad for workers, it’s bad for the country and it’s bad for the environment.”
Basically, GM can either make organization easy, allowing employees to check a box on a card if they want representation, or force them down the long, drawn out route of mandating a National Labor Relations Board election. At the moment, GM’s pleading neutrality, but neutrality isn’t the same as support.
4th Gear: Boy, I Sure Would Like A Cheaper Volkswagen ID.4
And if you live in Europe, you can get one! Volkswagen just announced new ID.4 base models that have a 52 kWh battery pack, as opposed to the 77 kWh one that the U.S. version comes with. That will definitely hamper range — VW projects about 213 miles under the WLTP cycle — but that’s also kind of the point. These ID.4 variants are labeled “City” and “Style,” and they’re intended for short distances, with pricing to match. From VW’s press release, by way of Automotive World:
These latest trims fit below the existing ones in the ID.4 line-up, with the City Pure having the additional bonus of being eligible for the Government’s Plug-in Vehicle Grant, thus starting at an eye-catching £32,150 OTR (with PIVG deducted). The City Pure Performance is priced at £36,030, the Style Pure at £38,150 and the Style Pure Performance at £39,530 (all OTR, recommended prices). Beyond those are the ID.4 Life, Family and Max models, with the 204 PS and 77 kWh ‘Pro Performance’ powertrain.
The first-edition ID.4. with the 77 kWh pack starts at £40,800, so the City model offers a sizable savings of more than £8,000, or about $11,000. Of course, pricing never directly translates between regional markets, but it’d be great to see Volkswagen lower the barrier of entry to the ID.4 on this side of the pond for those of us who aren’t beset by range anxiety.
5th Gear: Aston Says Manuals Had A Good Run
You’ve heard it before, and you’ll hear it again. The manuals are dying, and recently Aston Martin CEO Tobias Moers said the British brand won’t shed a tear as they wave goodbye. Courtesy of Australia’s Motoring:
“You have to realise sports cars have changed quite a bit,” he told Carsales at a roundtable interview with journalists.
Specifically referencing the manual developed internally by Aston Martin, the ex-Mercedes-AMG boss said: “To be honest, it was not a good journey.
“We did a few assessments about that car [manual] – you don’t need it anymore. And you have to maintain it with the new regulations, year-by-year with the emissions because it’s a bespoke powertrain. It makes no sense.”
Moers also shrugged off his predecessor’s logic of positioning the company as the last sports car-maker in the world to offer the coveted third pedal by pointing out that the current Porsche 911 GT3 comes with a manual transmission option, and that Aston Martin buyers overwhelmingly prefer an automatic.
Aston had previously pledged to be the final automaker to ditch the three pedal song and dance, but that was before switching executives. As it stands, the V8 Vantage AMR figures to be the last Aston to have a stick.
Reverse: Let’s Take The Reatta
On this day in 1991, frequent Nice Price Or No Dice star, the Buick Reatta, officially ended production. Of course, GM officially named the factory in Lansing, Michigan where it was built the “Reatta Craft Centre.” The British spelling really gave it that air of luxury, didn’t it?
Neutral: Allergies
It’s been going on for a week or two now, but we’re firmly entrenched in that time of the year where I have to weigh my desire to do things and have a life outside my home against my desire not to become a sneezing, sniffling, groggy, eye-watering mess. I drove with the windows down for like 10 minutes the other day and it wrecked me. Yeah, well fuck you too, pollen. Hope my fellow allergy sufferers are making it through.