Hyundai and Kia are (still) ahead of Tesla

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Photo: Hyundai

Hyundai and Kia to have their sights Teslas first place EV sales figures, Honda can get it supply chain from China, and Tesla wants California to have a lawsuit against racial prejudice against the company. All that and more in the morning shift in front of August 242022.

1st Gear: Tesla’s Shrinking EV Lead

Hyundai and Kia have officially taken over the car number two in electric vehicle market share in the US. The only company for them now is Tesla. It is also a similar story in Europe. The two Korean car manufacturers market share in Europe is now at 12 percent. The company took the most EV market share of any company last year.

Excluding China, Hyundai and Kia are the world’s second largest electric vehicle manufacturer. Together they have 14 percent of market part. That follows Tesla, which has 27 percent of the share. Still, Hyundai and Kia have a lot of work to do. From Financial times:

The gap reflects the competitive advantage Tesla has achieved in the more than a decade that it has maintained its leadership position in the market. Tesla’s cool factor — brand studies have called it the “coolest” automaker among millennials — is hard to replicate. So are the fast-loading network, remote software updates and massive amounts of data from the drivers that, when combined with machine learning algorithms, are constantly improving the software.

The latest boost for Tesla came in last week. The list of car models eligible for tax credits from President Joe Biden’s newly signed Inflation Reduction Act includes all four Tesla models currently on sale, but none made by Hyundai and Kia.

A more accurate comparison can be made by looking at the margins. Tesla’s lightweight business model means it has a chunky operating margin of 16 percent, more than double Hyundai’s 6 percent — which has broader product lines and must reckon with a strong union.

The long term trends for Hyundai and Kia are good though, and the FT says it’s no different than Samsung fresh Apple approx 2010.

Samsung’s share of the global market was less than 6 percent, compared to Apple’s lead of more than a fifth. It took just two years after the launch of its more expensive Galaxy smartphone series for Samsung to overtake Apple in terms of global handset sales.

In the second half of 2013, Samsung’s global smartphone market share was nearly three times that of Apple’s.

2nd Gear: Honda’s Supply Chain Decision in China

Honda is considering getting its non-domestic supply chain from China to reduce its dependency On the land. This would be a huge step for the company, and the reasoning is twofold. Production output from China has been choked by COVID lockdowns, and there are some concerns about the impact of tensions between China and the United States, Reuters reports, via Sankei.

About 40 percent of Honda’s car production was in China in fiscal 2021. While the non-domestic production may leave the country, Honda would still make Chinese domestic vehicles there. From Reuters:

A Honda spokesperson said the Sankei report is not something the company has announced, adding that it has been working to review and cover its supply chain in general.

“The review of the supply chain from China and the hedging of risks are elements to consider, but it is not quite the same as the purpose of decoupling,” the spokesperson said.

The government had previously provided incentives for companies to bring manufacturing back to Japan, although its adoption seemed moderate, with some executives and analysts saying it would be difficult for Japan Inc to suddenly move away from a market where it has been steadily growing manufacturing. and logistics hubs.

Mazda is already a bit ahead in the field of decoupling with China. The Japanese company said it would ask parts suppliers to increase inventories in Japan and produce more components outside of China.

3rd gear: Tesla wants race bias lawsuit to go away

Tesla lawyers try to convince a California judge to dismiss a lawsuit from the state’s Department of Civil Rights. That lawsuit accuses the car manufacturer of racial discrimination in an assembly plant.

Despite facing a number of other employee discrimination lawsuits, Tesla says the case is politically motivated. From Reuters:

In a complaint filed in February, the DCR said Tesla’s flagship factory in Fremont, California, was a racially segregated workplace where black workers were harassed and discriminated against in terms of job assignment, discipline and salary.

Tesla, which has denied wrongdoing, and his lawyers did not respond to a request for comment Tuesday. Nor the DCR, which until last month was called the Department of Fair Employment and Housing.

A state judge in April reduced a jury verdict for a black worker who alleged racial harassment from $137 million to $15 million. The plaintiff rejected the reduced award and opted for a new trial, scheduled for March 2023.

In its motion to dismiss the DCR’s case, Tesla says the agency has violated its obligations under state law by filing the lawsuit without first notifying the company of all claims or giving it an opportunity to to arrange.

The agency replied that before filing a lawsuit, it had followed all of its internal procedures, including giving Tesla the option to mediate.

earlier this sum, Tesla has filed a complaint with the State of California alleging that the DCR’s alleged flaws are widespread. The company also says the agency’s procedures are not legal. One thing is certain, many lawyers will make a lot of money before this is all over.

4th gear: Toyota is ashamed of Hino

Hino has had a rough time lately. The company is involved in a number of Striking emissions and scandals about fuel efficiencyand now Toyota is kicking the truck maker out of a Japanese commercial vehicle consortium.

Just over a year ago, Hino joined the group to accelerate the switch to electrification. It now raises a big question mark about what will happen next for the company. From Automotive News:

Toyota and Hino announced the decision on Wednesday to expel Hino, with Toyota saying Hino’s “misconduct” was incompatible with the group’s “ambition and goals”.

The world’s largest automaker hosted the founding of the Commercial Japan Partnership Technologies Corp., or CJPT, in April 2021 to help Japanese commercial vehicle manufacturers transition to battery-electric, hydrogen fuel cell and self-driving technologies.

It initially brought together Toyota, Hino and Isuzu, with Toyota agreeing to take a 4.6 percent stake in Isuzu as part of the partnership. Toyota already had a 50.1 percent stake in Hino.

“We are extremely disappointed with the company’s misconduct,” Toyota president Akio Toyoda said of Hino. “Hino has long committed misconduct in engine certification and the company is in a situation where it is not recognized as one of the 5.5 million individuals in the Japanese auto industry.”

Hino employees reportedly false tests on engines used in more than 640,000 vehicles in the past. Now 66,817 are being recalled.

Toyoda added that Hino’s participation in CJPT will make the other members of the group “uncomfortable” as they work on electrification. Woof… talk about a disappointed parent.

5th gear: CATL is doing well

CATL is the world’s largest manufacturer of EV batteries, and it’s kind of killing it right now. The company said on Wednesday that it More than doubled its profit in the second quarter of 2022. The news comes as the Chinese government rolls out new incentives to boost electric vehicle sales. The move is intended to absorb the blow of COVID lockdown during that period.

CATL’s customers include Tesla, Volkswagen, and BMW at the moment. The company reported net profit of $974.64 million (6.68 billion yuan) from April to June this year. Reuters says that’s a 164 percent increase from just a year ago. Not too shabby.

From Reuters:

The company said a COVID outbreak during the period, which included lockdowns in several cities, including Shanghai, had some impact on the domestic market. However, demand remained strong as local authorities rolled out incentives to promote EV sales and companies launched new models.

EV sales growth countered a general trend of weakening auto sales in key markets of China, Europe and the United States, which were hit by COVID and supply chain problems, CATL said.

In China, electric vehicle sales rose 120% in the first half, while overall car sales fell 6.6%, according to the China Association of Automobile Manufacturers.

CATL said it has taken steps including signing long-term contracts with suppliers, recycling materials and negotiating a dynamic battery pricing schedule with automakers to ease pressure from rising costs.

CATL also said it is accelerating its expansions in overseas markets. It has new contracts to supply batteries to Mercedes-Benz, BMW, and Ford.

Overall CATL’s global market share for EV batteries is at 34.8 percent for the first half of 2022, 6.2 percent more than a year ago.

Reverse: a real cock move

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