GENERAL MOTORS BATTERY JOINT VENTURE

General Motors Co and South Korea's LG Chem said on Thursday they will invest $2.3 billion to set up an electric vehicle battery cell joint venture plant in Ohio, creating one of the world's largest battery facilities. The plant, to be built at a new site near GM's closed assembly plant in Lordstown in northeast Ohio, will employ more than 1,100 people, the companies said. Construction is to begin in mid-2020 and the plant will have an annual capacity of more than 30 gigawatt hours with the flexibility to expand.

Source: Reuters

GM AT CENTER OF MPG, ELECTRIC-VEHICLE TAX CREDIT FIGHTS

General Motors Co. is at the center of a political fight in Washington about gas-mileage rules and the future of tax credits for electric vehicles as Congress gears up for an end-of-year push. The Detroit manufacturer is one of the loudest voices lobbying for an extension of a federal tax credit that provides up to $7,500 to buyers of electric vehicles, but GM has angered some Democrats by siding with President Donald Trump in a fight with California over fuel-economy regulations.

Source: The Detroit News

TOYOTA'S BIGGEST PROBLEM IS KEEPING HYBRID CAR MODELS IN STOCK

Toyota Motor Corp. has a problem with selling its hybrids – it can't get enough of them. While many of its competitors are walking away from hybrids and plowing billions into battery-powered cars, the Japanese automaker has seen demand surge for its 14 gasoline-electric models. Toyota's hybrids accounted for 13% of total Toyota and Lexus brand sales in the U.S. last month and made up nearly a quarter of the volume for its top seller, the RAV4 compact SUV.

Source: Bloomberg

GM SETS FINAL ASSEMBLY DATE FOR OSHAWA

General Motors Canada says it expects to cease production at its Oshawa, Ont., assembly plant the week of Dec. 16, but adds in an email to Automotive News Canada that "final dates are yet to be official." The automaker will no longer produce the Cadillac XTS and Chevrolet Impala. It will also stop final assembly of the outgoing Chevrolet Silverado and GMC Sierra in Oshawa, which were being shipped from Indiana for final assembly in Oshawa. The end of production will leave about 2,300 workers unemployed.

Unifor, the union representing hourly employees at Oshawa, said in an email it had expected assembly to continue to Dec. 19 but said it now has been informed that production will end Dec. 17. The union said it was preparing a public statement for "later this month." About 300 workers will remain employed, stamping parts for GM and, potentially, suppliers. The automaker has made a10-year commitment to build parts, such as quarter panels, trunks, doors and hoods at the plant.

GM has already broken ground on a 55-acre (22-hectare) test track at the site. Part of a $170-million investment at the plant, the track will be used to test autonomous- and connected-vehicle technology. The circuit, to be on the site of a plant that was once one of the largest auto factories in Canada, will be linked to the two-vehicle development sites GM has in the country.

General Motors said in November 2018 that no more vehicle production would be allocated to Oshawa beyond 2019 as part of a larger corporate restructuring.

Some Oshawa workers are eligible for retirement incentives of up to $150,000. Packages for workers with 30 years of service or are of retirement age are among workers eligible for an "enhanced retirement incentive," which includes $130,000 for non-trades workers and $150,000 for skilled-trades workers. Those workers would also receive a $10,000 vehicle voucher.

Workers with under 30 but more than 26 years of experience can opt to enter a "Leave to Retirement Program," which would place the worker on leave while receiving 65 per cent of their wages during that time. They would receive retirement incentives of between $55,000 and $95,000 depending upon their job and years of service, as well as a $10,000 vehicle voucher, upon reaching 30 years of seniority. Those workers can also choose to immediately retire, with retirement packages ranging from $90,000  to $115,000, as well as a vehicle voucher.

Full-time workers with seniority who are less than 50 years old but have 10 or more years of experience and will turn 50 within three years can elect to be placed on layoff before collecting early retirement benefits at age 50. They can also elect to take a buyout of $130,000 ($150,000 for skilled-trade workers) and a $10,000 vehicle voucher. Those with less than 10 years of seniority will be offered lump sum payments ranging from $10,000 to $40,000 depending upon their experience.

A union notice on retirement previously said senior members could apply for up to $6,000 in retraining funds, while temporary, part-time workers can receive up to $3,000. GM Canada has said it would set up a "Jobs Action Centre" to help workers find new employment in the area and in related fields.

Source: Automotive News Canada

GM TRUCK PLANT GOES TO 7 DAY WORK WEEK

After a 40-day strike depleted stocks of Chevrolet and GMC pickups, General Motors Co. assembly plants are working nearly non-stop to restock dealer lots and prevent loyal customers from shopping for a Ford or Ram. Mandatory Sunday overtime has been invoked through Dec. 21 at GM's Flint Assembly plant, which builds heavy-duty Chevrolet Silverados and GMC Sierras. That plant already was running three shifts, six days a week.

Source: The Detroit News

HONDA'S HACHIGO SEIZES THE WHEEL AS QUALITY CRISIS HITS PROFITS

At a two-day gathering for Honda's suppliers in March, Chief Executive Takahiro Hachigo sounded the alarm. At the Hotel Higashinihon in Utsunomiya, Hachigo told them the Japanese automaker was facing a crisis after a string of costly recalls and other quality blunders and it needed to plot a new course, according to two people who attended the meeting. Since then, Hachigo has been quietly working on reforms to centralize decision-making by bringing Honda's standalone research & development (R&D) division in-house and cutting some senior management roles, according to three Honda insiders.

Source: Reuters

NISSAN FACES $22 MILLION FINE FOR UNDERREPORTING GHOSN'S PAY

Nissan Motor Co. is set to be fined 2.4 billion yen ($22 million) for underreporting former chairman Carlos Ghosn's compensation, Japan's securities regulators said.The Securities and Exchange Surveillance Commission made the recommendation just over one year after Ghosn's arrest, which shocked the auto industry and triggered turmoil at the Japanese automaker and its alliance partner, Renault SA.

Source: Bloomberg

VW CHARGED WITH VIOLATING CANADA'S VEHICLE EMISSION STANDARDS

German automaker Volkswagen on Monday was charged with importing nearly 128,000 vehicles into Canada contravening the country's environmental legislation, a Canadian government agency said. Volkswagen was charged with 60 counts of breaching the Canadian Environmental Protection Act by importing vehicles that did not conform to prescribed emission standards, Environment and Climate Change Canada said. The charges include 58 counts of contravening the Act between January 2008 and December 2015. The charges also included two counts of providing misleading information, and a court hearing is scheduled for Dec. 13 in the Ontario Court of Justice.

The company did not immediately respond to a Reuters request for comment. In 2015, the agency launched an investigation into the importing of certain vehicle models allegedly equipped with a prohibited "defeat device". In this case, the device was software that reduces the effectiveness of the emission control system during normal vehicle use, according to the agency. "Environment and Climate Change Canada's enforcement officers conducted a very comprehensive, thorough and meticulous investigation. Officers gathered an extraordinary quantity of evidence and information from foreign and domestic sources related to the suspected violations of federal environmental legislation," ECCC said in a statement. "This involved collecting all relevant information possible, while working within different international legal environments. They then spent months poring over the information, analyzing and preparing the evidence for Public Prosecution Service of Canada review."

News in 2015 that Volkswagen had used such devices to cheat emissions tests has so far cost the company about 30 billion euros (US$33 billion) in fines, vehicle refits and legal costs, and also triggered a global backlash against diesel vehicles. Because all charges are currently before the Court, Environment and Climate Change Canada said it will not comment further at this time.

Volkswagen previously lost a pair of class-action lawsuits filed in Canada surrounding the "defeat devices."

Source: Financial Post and Automotive News Canada

AS FORD, CHEVY EXIT SEDAN MARKET, ASIAN MAKERS GAIN SHARE

A year after Ford and Chevrolet abandoned the compact-car segment to prioritize SUVs, buyers are abandoning those makes and shopping for cars made by Hyundai, Toyota and Honda. Some 42% of Ford Focus and Chevy Cruze compact car owners have stayed in the compact car segment with a significant percentage buying competitors' vehicles, according to an industry study by Edmunds that finds a deterioration of market share for the Detroit makes, and a decline in brand loyalty.

Source: The Detroit News

INDEPENDENT DEALERS PINCHING USED-CAR SHOPPERS FROM FRANCHISES

Customers in the top credit tiers are choosing used vehicles in their highest numbers since the Great Recession, the latest Experian report says, due to an increased availability of late-model vehicles and a growing chasm in new- and used-vehicle pricing. But franchised dealers should take note — more shoppers in these tiers are headed to independent stores for their next used car.

Experian's third-quarter State of the Automotive Finance Market study noted that independent dealerships saw an increase in prime and superprime financing — credit segments that made up more than half of all used-vehicle loans last quarter. Prime customers, according to Experian, have credit scores between 661 and 780. Superprime customers have scores between 781 and 850.

Shares of prime and superprime auto loans originated at independent dealerships leaped in the third quarter, rising 1.88 percentage points and 1.17 percentage points, respectively, since last year at this time. Experian includes companies such as CarMax in its definition of independent.

Franchised car dealerships, meanwhile, lost shares of those loans in the third quarter, as prime loans fell 1.1 percentage points and superprime dipped 7 basis points.

Though credit scores have been rising for all credit tiers, the average credit score of an independent used-car shopper has steadily climbed over the past several years. In the third quarter, the average score was 630, compared with 609 in third-quarter 2015, Experian says. The average score for franchised stores' used-vehicle shoppers dipped slightly from last year, falling to 681 from 683.

Franchised dealers should monitor the competition from used-only stores in their area, and pay attention to the inventory increasingly sought by prime and superprime shoppers. Rather than taking customers in higher credit tiers for granted, franchised dealers should double down on marketing used-car inventory to buyers who have historically purchased new.

Source: Experian

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