Good morning! Today is Wednesday, July 3, 2024 and this is Morning shiftYour daily digest of the top auto headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: Winners and Losers in U.S. Auto Sales
American automakers are out shouting about their latest sales figures This week after the second quarter of the year ended last weekend. Light vehicle sales across the US fell one percent in three months due to computer problems The ability of car dealers in the US to sell cars.
Despite sluggish sales nationwide, some automakers have weathered the period better than others, with a report from Car News highlights the performance of GM, Honda, Subaru and Mazda, all of which reported increased sales in the quarter. However, fortunes were not as bright for the likes of Toyota, Stellantis, Hyundai, Kia and Nissan, all of which reported declines in sales for the three months. As Car News explain:
The U.S. new-car market lost some momentum in the second quarter as affordability, rising prices and higher borrowing costs continued to weigh on consumers, even as dealers scrambled to salvage sales after key software was hit by a coordinated cyberattack and shutdown.
General Motors, which is riding high on higher demand for large trucks and electric vehicles, reported a slight increase in U.S. sales in the second quarter. GM and other automakers said some shipments may be delayed or recorded in the third quarter after a late June cyberattack at CDK Global upset results at the end of the month.
Biggest sales for period at General Motorssold 691,680 vehicles in the quarter. It was followed by Toyota, which sold 621,549 vehicles, and Hyundai-Kia, which sold 438,602 vehicles.
The biggest percentage gain this quarter, however, came from a rather unexpected place, as Fiat recorded triple-digit growth due to 500 all-electric car launched in the US.
Despite some positive stories from filings this quarter, the mood was dampened by a computer glitch that affected dealers’ ability to sell cars since June 19. Car News more:
The new-vehicle market, which grew 5.6 percent in the first quarter, is on track for a more modest gain in June, with a widespread cyberattack at CDK weighing down final volumes. Many of the sales will be recorded or offset in July.
The shutdown, which began June 19, has hampered deliveries during what is typically the industry’s strongest time for new-vehicle sales — the end of the month. Many automakers and dealers are also rolling out promotions during the summer and the Fourth of July holiday to attract traffic and generate sales.
However, things now appear to be stabilizing and the power outage will be a distant memory when Q3 sales figures are released in a few months.
2nd Gear: Elon Musk Just Made Another $10 Billion
Tesla has had a rough few weeks. with its flagship Cybertruck causing all kinds of headaches, Their car sales are slowing down. and automakers are facing a relentless battle to justify $56 billion payment wanted to give to its big boss Elon Musk. Now, despite the difficulties, the automaker just made Musk another $10 billion despite the fact that it did nothing.
Yesterday, Tesla shared its latest sales and delivery figures for the previous quarter, which runs through June 2024. In the filing, deliveries fell for the American electric vehicle maker, and its lead in electric vehicle sales is now rapidly shrinking. Despite the bad news, sales were not as low as experts had predicted, and that sent Tesla shares soaring. Forbes report. As the website explains:
Tesla shares jumped to nearly $229 around 11:30 a.m., adding to the company’s nearly 25% gain since its stock price fell below $183 on June 24.
The value of Musk’s stake in the company, about 12%, rose from about $150 billion to $160 billion at the market’s close on Monday, while a week-long rally added about $30 billion to the stock’s value.
You read that right, although sales are down nearly five percent from last year, Elon Musk earns another $10 billion for his work at Tesla. Tesla’s stock price and Musk’s net worth spiked after Tesla beat analysts’ expectations for the quarter, in which the company expected to sell about 439,000 vehicles.
Tesla did slightly better than that, however, selling 444,000 vehicles in Q2 2024. That represents a 14.8 percent increase over the brand’s Q1 sales, but marks a 4.8 percent year-over-year decline as it faces more intense competition from other car manufacturers around the world.
Gear 3: The Dealers Are Back, Baby
One of the big stories this week was the impact of computer outages across the US on auto sales after the CDK Global Computer Services Provider was hit by a cyberattack in June. The outage left many dealerships unable to sell cars at the end of the month, but the company now says it is ahead of schedule. repair your network after a power outage.
CDK Global now says “most” of its dealerships are back up and running and able to sell cars again after a cyberattack crippled its systems. CNN reportThis means that nearly 15,000 dealerships across the US have now had their systems restored following the outage on June 19. As CNN reports:
CDK Global said “nearly all” of the nearly 15,000 auto dealerships using the company’s software across North America are back up and running with core management systems, nearly two weeks since a network outage caused the software to go offline.
“We are pleased to announce that we are ahead of schedule,” said an automated message on CDK’s customer service phone line.
Auto dealers use CDK’s software to manage everything from scheduling to record keeping.
The update will be good news for U.S. dealerships, which have been struggling to update inventory, process repairs, and even sell cars for more than two weeks. In fact, CNN estimates that the CDK outage could cost dealerships nationwide as much as $944 million in lost business.
Those losses could come back to bite CDK Global, which is now facing a slew of lawsuits from customers and agency employees over the system outage. The company is currently facing up to eight different lawsuits related to the outage, report Car News. As the website explains:
Ten customers from Arkansas, Michigan, Oklahoma and Texas who purchased vehicles from CDK Global dealerships have joined together to sue the software provider following a cyberattack on June 19.
Their June 27 complaint in the U.S. Northern District of Illinois joins other federal lawsuits filed by consumers against the dealership management system company. It also seeks class-action status, in this case defining the group as anyone whose information “actually or likely was accessed or obtained” in the recent CDK incident.
Well, you know what they say: there’s no such thing as a complaint unless there’s a problem.
Gear 4: Rivian won’t build cars for VW
The world watched with mild interest last month as the auto giant Volkswagen says it will spend millions of dollars into US electric vehicle startup Rivian, which has major backing from the likes of Amazon. Many thought this meant VW may start using Rivian technology in its vehicles, or Rivian could even assemble VW models in the US to take full advantage of tax breaks here.
However, after German media reported on the partnership between Rivian and VW, the American company quashed any rumors that it would start producing electric vehicles for the German giant. Reuters report. As the website explains:
German newspaper Handelsblatt reported Tuesday, citing people familiar with the matter, that the expanded partnership could include production of Rivian’s smaller and cheaper R2 SUVs at VW’s South Carolina factory currently under construction.
“There are no plans to produce vehicles with the Volkswagen Group,” a Rivian spokesperson said in an email to Reuters. Volkswagen declined to comment on the media report, saying its clear focus was on the joint venture.
The move comes after a $5 billion investment VW invests in Rivianannounced by the two companies last week. As part of the deal, the two companies will share electrical and software architectures with each other.
The move follows similar partnerships between EV startups and traditional automakers that have so far seen Aston Martin partners with Lucid And Stellantis takes over Chinese electric vehicle maker Leapmotor under its wing.
Conversely: Are we the bad guys?
On the Radio: Olivia Dean – ‘Diving’
