Good morning! It’s Tuesday, April 30, 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: Entire Tesla Supercharging Crew Cut By Musk
Tesla CEO Elon Musk dismissed two senior executives at the automaker, and he apparently plans to lay off hundreds more employees. This is all happening because he’s reportedly frustrated over falling sales and the pace of job cuts so far. Keep in mind that Tesla laid off at least 10 percent of its entire staff earlier this month.
Along with Rebecca Tinucci, senior director of Tesla’s Supercharger business, and Daniel Ho, head of the new vehicles program, Musk is also laying off 500 employees who work under Tinucci in the Supercharger group. This is, of course, happening right as other automakers get widespread access to Tesla’s Supercharger network. From Reuters:
“Hopefully these actions are making it clear that we need to be absolutely hard core about headcount and cost reduction,” Musk wrote in the email, the report said. “While some on exec staff are taking this seriously, most are not yet doing so.”
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Ho joined Tesla in 2013 and was a program manager in the development of the Model S, the 3, and the Y before being put in charge of all new vehicles, while Tinucci joined in 2018 as a senior product manager, according to their LinkedIn profiles.
Two other senior leaders — Patel and battery development chief Drew Baglino — announced their departures earlier this month, when Tesla also ordered the layoffs of more than 10% of its workforce.
Tesla is in the midst of dealing with sales falling sharply and an intense EV price war. It led to the Austin, Texas-based automaker posting a quarterly revenue decline for the first time since 2020.
Only time will tell how laying off a huge chunk of the staff from one of Tesla’s more ventures will go. If I had to hazard a guess, it will not be good.
2nd Gear: NHTSA Turns Its Attention To Ford Blue Cruise
The National Highway Traffic Safety Administration’s Office of Defects Investigations said on April 29 that it has opened a preliminary investigation into Ford’s BlueCruise hands-free driving tech. The U.S. auto safety regulators were made aware of two incidents involving Mustang Mach-E electric crossovers that crashed into stationary vehicles. From the Detroit Free Press:
Both the collisions occurred during “nighttime lighting conditions,” and each resulted in at least one fatality, according to the NHTSA.
ODI’s initial investigation of the incidents confirmed BlueCruise’s engagement in each of the vehicles right before the collision.
BlueCruise is only available on certain roadways and uses a camera-based driver monitoring system to determine driver attentiveness.
The investigation will evaluate the system’s performance on the dynamic driving task and driver monitoring, the NHTSA said.
BlueCruise was introduced in model year 2021 vehicles and at present is there in a range of Ford and Lincoln vehicles.
This isn’t the first NHTSA probe into hands-free driving technology. Just last week, NHTSA opened an investigation into whether Tesla’s recall of over 2 million vehicles back in December to install new Autopilot updates was good enough following a series of crashes.
The safety regulator received reports of 20 crashes involving Teslas that had the new Autopilot software updates. Not good.
Following this news, the whole vibe I’m getting from hands-free driving is that it just is not ready for primetime, and maybe automakers should take a step back for a moment and think about if this is the best use of their time.
3rd Gear: Volkswagen Had A Rough First Quarter
Volkswagen Group is holding strong to its 2024 revenue targets despite the fact it posted a 20 percent drop in first-quarter operating profit because of lower sales and higher costs as it readies new models. From Reuters:
“As expected, our first quarter results show a slow start to the year,” finance chief Arno Antlitz said, adding that rising orders in March would have a positive impact on its second-quarter results. “We expect additional momentum over the course of the year from the launch of more than 30 new models across all brands.”
In particular, the German automaker’s luxury brand Porsche reported a 14.8% operating margin decline on higher model revamp investments and lower demand for premium cars in China. The company’s earnings were also hampered by delivery delays at its luxury Audi brand.
Volkswagen said last week it aims to keep its Chinese market share roughly stable until the end of the decade, betting on heavy investment to support sales despite a raging price war with local electric vehicle (EV) rivals.
The automaker said its order book remains stable versus the end of 2023 and orders for fully electric vehicles more than doubled in the first quarter versus the same period last year.
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VW’s vehicle sales fell 2% year-on-year, totalling 2.1 million units in the quarter.
Despite the dip, Volkswagen said it still expects 2024 sales revenue to rise up to 5 percent, and its full-year operating profit margin will rise between 7 percent and 7.5 percent.
Earnings before interest and taxes (EBIT) came in at $4.92 billion for the first three months of 2024.
4th Gear: Stellantis’ Q1 Wasn’t Much Better
Stellantis said its revenue fell 12 percent in the first quarter of 2024 because of lower volume, a shitty product mix and foreign exchange dynamics. Shipments were down 10 percent in the first three months of the year to 1.335 million units. From Automotive News:
CFO Natalie Knight on Tuesday said shipments and revenues were affected by the transition to the group’s new product portfolio, based on new platforms, and that Stellantis was reducing inventories “to reinforce our strong relative pricing ahead of our new or mid-cycle product launches this year in key regions.”
Key model transitions in Europe include new generations of the Peugeot 3008 and 5008 compact and midsize SUVs, including EV versions of both, and Citroen C3 and C3 Aircross small car and SUV, also with low-cost EV options.
Net revenue was €41.7 billion ($44.6 billion) in the January-March period, short of analyst expectations of €42.6 billion, according to a Reuters poll.
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In the enlarged Europe region, which includes Turkey and Eurasia, shipments were down 6 percent to 615,000, while net revenue was down 13 percent to €16.1 billion.
The lower volumes were mainly due to sales declines for the Peugeot 3008 ahead of the new model launch, the Opel Mokka small SUV and the Fiat 500, Stellantis said.
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Analysts at Jefferies said in a note the below-consensus revenue was mostly due to the quarterly performance in Europe, where both volume, price and product mix were worse than expected. Net pricing capacity was “more resilient” in other regions, they added.
Stellantis, following European regulations, does not report full financial results in the first and third quarters.
Stellantis does expect the times to change rather soon, though. Knight said the automaker is confident its plans to launch 25 new models or facelifted vehicles in 2024, including 18 electric vehicles, would help Stellantis “improve its growth and profitability” for the rest of 2024.
She said “blockbuster” product launches like the Ram 1500 and Ram Rev electric truck will build momentum for the automaker as the year goes on.