Don't call it "Audi", auto job cuts, Lyft fights back Uber on AVs and Xpeng unveils an EREV system

💡 This Week In The Mobility World

🏭 Factories/Manufacturing/Recalls

The automotive industry faced a tough week, marked by numerous job cuts.

• Nissan will cut 9k jobs and reduce global manufacturing capacity by 20% to save $2.6B this fiscal year amid weak sales in China and the US! The plan highlights the ongoing struggles of Japan's third-largest automaker, which has faced challenges since the 2018 exit of former chairman Carlos Ghosn and a scaled-back alliance with Renault. Following a 6% decline in Tokyo trading on Friday, the shares experienced a significant 21% increase after activist investor Effissimo acquired a stake in the company!
• Stellantis is also facing challenges, with waning momentum in sales and several recalls impacting the group in recent months. Now, Stellantis plans to lay off 1,100 employees at its Jeep plant in Toledo, Ohio.
• And it doesn't end there for the car manufacturers, with one more for the road, Lotus, that is cutting up to 200 UK jobs as demand wanes. While production of the Evija and Emira continues, the focus shifts to fulfilling existing orders.
• While the current crisis is affecting automakers, it is obviously also having an impact on their suppliers. Michelin will close its Cholet and Vannes factories in France before 2026, impacting over 1,250 jobs, due to a sharp decline in business. The company’s CEO has reassured employees that support will be provided during this challenging period.

• On the same day, Schaeffler, the German automotive parts manufacturer, announced plans to cut 4,700 jobs in Europe after a nearly 50% drop in Q3 operating profit due to “the difficult market environment, the growing intensity of global competition and the ongoing transformation, particularly in the automotive supply industry”.

🤖 Tech

• A blow for HERE Technologies: Volkswagen Group, one of its shareholders, is switching providers and has chosen TomTom to supply CARIAD with a connected navigation solution, customized for the needs of electric vehicles. Audi will be the first to roll out the new system, though no launch date has been shared.
• Facing headwinds in its core market of autonomous agricultural tractors, U.S.-based startup Monarch Tractor announces a 10% workforce reduction, following a prior 15% cut last summer that already happened right after its $133M Series C funding announcement, reports TechCrunch. The company is now refocusing on its farm management AI and licensing its off-road autonomous driving stack to other niche players.

• After Uber’s AV shopping spree, it’s now Lyft’s turn to announce a few partnerships. First with Mobileye, with whom Lyft will work to deploy autonomous vehicles at scale, by rolling out “Lyft-ready” vehicles equipped with Mobileye technologies. Then with May Mobility, which announced it will use Lyft’s platform to offer its commercial services starting next year in Atlanta with a fleet of Toyota Siennas equipped with its own technology. This agreement will expand to other cities over the coming years.

🧙 New Car Reveals

• Don’t call it Audi: introducing the AUDI E Concept for China. Audi swaps its iconic four rings for an all-uppercase name in its new sub-brand exclusive to the Chinese market. Slightly confusing, perhaps, but a clever way to balance the heritage of the iconic German brand with new, boundary-pushing products featuring a host of Chinese technologies sourced from SAIC. The styling leans more heavily toward new influences, with only subtle nods to its German parent. But this new formula makes sense and will serve as a barometer for the survival capacity of European players in the Chinese market.

⚡️ EVs

• Rivian confirms its delivery outlook for 2024 (50-52k vehicles). Its efforts to optimize manufacturing processes and costs are showing results: the company is still losing money but reports being on track for a positive gross profit in Q4, also thanks to a sales shift toward more premium variants. Additional bright spots include a new U.S.-made battery cell supply contract with LG Energy Solutions, the introduction of a Tri-Motor variant for the R1, and strong conversion rates from trial to subscription for its Connect+ services package. However, caution is warranted: with a $1.1B loss in Q3, Rivian is operating on a cash runway of a few quarters, which may heighten its dependency on Volkswagen.
• No surprise here: Bentley is taking a cautious approach to electrification. The company has extended its EV transition strategy, now targeting 100% BEV by 2035 instead of 2030, giving its PHEV engines an extra five years of life. Bentley has also announced its first electric model, an urban SUV, set for 2026.

• Surprise! Xpeng has unveiled a new Extended Range EV system during its 2024 AI Day, an announcement that could set a trend among Chinese newcomers: Firefly, Nio’s sub-brand, is also suspected of preparing a similar launch. On the menu: an ultra-quiet combustion engine that continuously charges an electric battery, which can also be recharged very quickly (0-80% in 12 minutes for 430 km of range) and an EREV mode range that can reach up to 1,400 km. The motivations are clear: to meet cooler demand in more rural areas, but also to flood the European market with electric vehicles more easily without incurring excessive customs duties, as EREVs (and PHEVs, hence SAIC’s push with MG hybrids in Europe) are exempt. For Nio, it’s also a matter a decreasing the investment requirements from its battery swap stations for any new market entry.
• Also at Xpeng’s AI Day: an update on its always more powerful AV chips, a new AIOS onboard system that integrates OpenAI’s GPT-4o, a first public flight for its eVTOL already planned for this month, with pre-orders starting next month, the release of the Xpeng P7+ and last but not least, its AI Robot Iron, an humanoid robot developed for 5 years and already customized to internal operations in its plants and stores. In short: Xpeng isn’t slowing down on the tech front, investing in robotics like Tesla to revolutionize its manufacturing processes, and potentially finding in EREV a key to boost its sales… and fund this wave of ambitious tech projects.

💰 Investment/Financial/Legal

• A stark symbol of the challenges European players face in staying competitive in capital-intensive advanced innovation fields: German eVTOL startup Lilium is now up for sale after filing for insolvency several weeks ago. This impacts 1,000 jobs, despite Lilium’s order book of over 700 flying taxis. Lilium’s stock has also been suspended on the NASDAQ.
• Meanwhile, its California-based competitor Archer, heavily funded by transatlantic group Stellantis, continues to thrive, with its order book now valued at over $6 billion following an additional $500 million order from a Japan Airlines subsidiary.
• Mixed results for Daimler Truck in Q3 2024: while 2024 targets are maintained and U.S. results show slight growth, the German group’s volumes have dropped by 11% compared to Q3 2023, and earnings before taxes fell by 12%. These declines are largely attributed to challenging market conditions in Europe and Asia.
• According to Bloomberg, French car-leasing firm Ayvens, majority-owned by Societe Generale, is attracting takeover interest from Blackstone, Brookfield, and CVC Capital after a decline in its shares. Ayvens' stock surged 8.7% Thursday, valuing the company at €5.8B ($6.2B). Societe Generale, holding a 53% stake, might consider a privatization partnership as the company faces financial pressures from IT overruns and weaker EV values. Industry player JA Mitsui Leasing is also reportedly interested, but discussions remain preliminary.
• VinFast will receive $3.35B in funding by 2026 from its founder Pham Nhat Vuong and parent company Vingroup to support its push toward breaking even. Vuong plans to contribute $1.97B, with Vingroup lending $1.38B and converting existing loans into preferred shares. Although VinFast has already secured $13.5B in funding since its founding in 2017, it continues to report significant losses, including a net loss of $773.5M in the second quarter alone, as it faces demand challenges and intensifying competition. These difficulties have also led to the delay of a $2B North Carolina plant project, now set for 2028.

🗞️ Bookmarks

Baseline vulnerable road user injury risk in multiple U.S. dense urban driving environments by Waymo

Waymo published a new study, available online since November 1st, focused on improving the safety of vulnerable road users like pedestrians and cyclists. By analyzing hundreds of real-world crashes, Waymo aims to enhance its AV technology and set new safety standards!

Here is the result of the study: “vehicle speeds at the time of impact ranged from 0 to 39 mph, and VRU speeds rangedfrom 0 to 27 mph. In general, vehicles were traveling at lower speeds at the time of impact whenturning in comparison to straight travel. Nearly all events (95%) were associated with MAIS3+ injuryrisk estimates below 10%. Collisions involving a potential occlusion or the vehicle responding tosurprising behavior by the VRU were associated with higher estimates of injury risk than thosewithout occlusion or with the vehicle initiating the conflict. Based on accumulated risk for eachevent, it can be estimated that approximately 55 persons could be moderately injured (MAIS2+) andapproximately 6 persons could be seriously injured (MAIS3+).”

See you next Monday!