Happy Thursday! It’s March 14, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Fisker Sure Seems To Be Getting Ready To File Bankruptcy
Running a car company, when you haven’t been doing it for 100 years already, is a difficult endeavor. Fisker, for one, has never had an easy time with the whole “making cars” thing, and now a report says things could be taking a turn for the worse. From the Wall Street Journal:
Electric-vehicle startup Fisker has hired restructuring advisers to assist with a possible bankruptcy filing, according to people familiar with the matter.
Fisker, which recently warned that it risked running out of cash this year, hired financial adviser FTI Consulting and the law firm Davis Polk to work on a potential filing, the people said. The car company reported last month that it had $273 million in sales last year and more than $1 billion in debt.
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Shares of Fisker fell more than 46% in after-hours trading Wednesday after The Wall Street Journal reported the company’s hiring of the restructuring firms.
The Manhattan Beach, Calif.-based company in late February delayed the release of its full financial results for last year, because it lacked a sufficient number of experienced accounting professionals, according to a regulatory filing.
Tesla is a truly rare success story in the car-startup world, and most of the folks trying to replicate its success are — statistically — likely to fail. Maybe building cars with fewer issues would help, though. Just a thought.
2nd Gear: Ford Wants To Sell In-Car Driver Tracking Software
If there’s one thing companies love, it’s ensuring that their workers don’t spend five minutes a day doing anything other than work. Ford, apparently, sees this as a path to additional profits: Selling driver-tracking software to fleets. From Reuters:
That may annoy some employees, but it is good news for Ford Motor Co’s (F.N), opens new tab commercial vehicle unit, Ford Pro, which has placed a big bet on software-related services. Ford Pro hopes selling connected-vehicle services such as driver monitoring systems to small and medium sized fleet operators will help generate as much as $1.8 billion in annual profit within two years.
Ford CEO Jim Farley has urged investors to think of Ford Pro’s bundle of software and vehicle sales, not Tesla (TSLA.O), opens new tab, as the “future of the automotive industry.”
Companies including Geotab and units of Verizon (VZ.N), opens new tab dominate the market for telematics services provided to large vehicle fleets, said Mike Ramsey, vice president at technology consultancy Gartner.
But Ford “can get all the guys buying Ford Transits for their plumbing business,” Ramsey said.
Small and medium-sized business fleets in North America and Europe constitute a large enough market that Farley has told investors Ford Pro could earn 20% of its pre-tax profit from selling software and services within two years.
Sure, modern workers are far more productive than just about any time in history. And, no, they aren’t paid commensurately. But, consider, what if you watched them constantly and without rest every day to see if they ever looked at their phone for two minutes? How productive could they be then?
3rd Gear: Chinese Manufacturers Are Opening More Factories Abroad
Much of the world is pushing back against Chinese-manufactured EVs, imposing tariffs and other regulatory obstacles to stop the often-cheaper cars from showing up on their shores. China, now, is doing what everyone else does in this situation: Building its cars somewhere else. From Reuters:
Chinese automakers seeking global growth are building more car factories in overseas markets, as foreign regulators mull imposing measures against imports of China-made electric cars.
Chery Auto is holding talks with the Italian government to manufacture there, Reuters reported on Wednesday. Should the talks succeed, Chery would be among the first Chinese automakers with a European manufacturing presence.
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Here’s what Chinese automakers are planning:
BYD
The world’s largest EV maker has been building car factories in Thailand, Brazil, Hungary and Uzbekistan.
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SAIC has built three overseas car plants in Thailand, Indonesia and India. It also has a so-called knocked down (CKD) assembly plant in Pakistan where it puts together cars from parts delivered to the site.
Same as it ever was. Even Harley-Davidson dodges tariffs with construction abroad — if anyone expected Chinese automakers not to try the same tricks, they haven’t been paying attention to how this all works.
4th Gear: Stellantis To Pay Just $84,420 For Polluting Factory
Way back in September, Stellantis came under fire for a plant in Michigan that polluted the air more than the legal amount — filling the surrounding area with volatile organic compounds. Now, the fix is in: One up-spec Wagoneer worth of fines. Yep, that’ll do it. From the Detroit News:
Stellantis NV must pay $84,420 in fines to the state of Michigan under a deal finalized Monday to resolve repeated air quality violations at the company’s Jefferson North Assembly Plant paint shop.
The consent order, signed by Stellantis and Michigan Department of Environment, Great Lakes and Energy officials, was due to the company releasing more volatile organic compounds, or VOCs, than it was allowed from September 2022 through September 2023.
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Under the agreement, FCA US LLC, the U.S. division of Stellantis NV, agrees that if emissions go above 4.8 pounds per paint job on average for a quarterly period, the company must submit a mitigation plan, explain the reason for the higher emissions, and document how it plans to reduce them. The company also will pay fines up to $4,000 per month when it misses the emissions limit.
That’ll show ‘em! If you pollute the air around your factories, even for just one single year, you’ll have to pay one middle-manager’s entire salary worth of fines! Wait, why is everyone laughing?
Reverse: Smart Guy
Neutral: Happy Riding Season!
My GS is back out of the garage this week, after a couple of months spent stored as poorly as possible: No stabilizer, partially-full fuel tank, tires touching the ground. Yet, with the help of a charger to freshen up the battery, it fired right up without complaint or issue. Gotta love resiliency, right?
On the Radio: Caroline Rose — “Soul No. 5″
