Good morning! It’s Thursday, May 9, 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: Tesla Deletes Over 3,400 Job Listings
Tesla just cut over 3,400 job postings in North America, leaving just three positions currently open. The roles, based primarily in California, Texas and Nevada, were listed on Tesla’s official career page as recently as Tuesday.
The hiring freeze comes right after Tesla dealt with one of its shittiest quarters ever and rolling layoffs that have spanned over four weeks at this point as part of CEO Elon Musk’s edict to get “hard core” about job cuts. During the same time, at least six executives have fled the company. From Business Insider:
Even the three US roles that remain don’t appear to be full-time jobs, although they’re labeled as such. They’re for Tesla’s “manufacturing development program,” a seven- to 16-week training program at community colleges in Texas and California that gives applicants an “opportunity to transition into a full-time Production Associate.” The Nevada version of the program is marked as an internship and is only four to six weeks, according to Tesla’s website.
Tesla revoked summer-internship offers last week, just weeks before start dates.
There are 28 jobs listed in Europe on Tesla’s website, mostly in Tesla’s Brandenburg Gigafactory in Germany. There are none posted for any other regions.
But Tesla’s career page and its LinkedIn don’t seem to be in sync.
On LinkedIn, the company advertised 35 openings on Thursday, including the three in the US and the 28 in Europe, but also some roles in the Dominican Republic — these roles have been listed in Mandarin.
It’s hard to say when the job cuts will really end, and I’m not totally sure about the strategy of “freeze hiring and lay people off until we figure out how many people should work here.”
2nd Gear: Rimac CEO Thinks The Rich Are Out On EVs
Rimac has yet to sell 150 examples of its electric Nevera hypercar, and that may be why any replacement that comes later probably will not be an electric vehicle. In fact, Rimac has only managed to sell about 50 units so far. Mate Rimac, CEO of the Croatian automaker attributes that to a decline in demand for ultra-high-end EVs. From Autocar:
“We started to develop [the] Nevera in 2016/2017, when electric was cool,” he told the Financial Times Future of the Car conference in London.
Since then, he said, the market environment has evolved, with tastes changing as legislators and mainstream car makers seek to make electric cars the mainstream.
“The regulators and some OEMs [manufacturers] push it so much that the narrative has changed. They’re pushing stuff on us that we don’t want, so people get a little bit repulsed by it, this whole forced application.
“I’m always against it. I think everything has to be based on merit. So the product has to be better.”
The Nevera was developed partly as a showcase of what could be achieved with motors and batteries in an era when the technology was still in its nascence and had yet to be fully embraced and rolled out by mainstream manufacturers.
“At that time,” Rimac said, “we were thinking electric cars would be cool in a few years – the best cars, or with the highest performance and so on.
“We notice 1715263864 that as electrification is becoming mainstream, people at the top end of the sector want to differentiate themselves.”
Rimac told Autocar that buyers are sort of returning to a desire for more analog vehicles, at least as far as supercars are concerned.
During the interview, he turned his attention to the company’s partnership with Bugatti.
He added that “if we did an electric Bugatti, we would have sold an amount of them, for sure, because of the brand”, but that amount would have been “nowhere near” the estimated amount it will sell of the V16-engined Chiron successor.
Rimac said he doesn’t see demand returning for electric hypercars because, while in the mainstream car segments there will be little prevailing loyalty for individual brands and powertrain technologies, the high-end car segments demand a high level of differentiation and “analogue” appeal. […]“Rimac isn’t exclusively electric; it’s doing whatever is most exciting at the time,” he said, citing LPG, hydrogen and even diesel as potential fuels that could be used in this set-up.Meanwhile, he said he sees “no reason” for Bugatti, which Rimac acquired from the Volkswagen Group in 2021, to stop selling ICE cars in the near future.“We have developed a new V16 engine, and we want to use that engine for a while, and maybe some other engines, and I can’t see a reason why it would be impossible.”
You don’t usually hear the heads of other electric vehicle-only (for now, at least) brands speaking like this. No one knows what Rimac will have up its sleeve next, but one thing is for sure: it’ll be damn fast.
3rd Gear: Toyota Braces For Annual Profit Drop
Toyota is projecting a drop in its fiscal-year profit, blaming higher costs. Because of this, the Japanese automaker announced a share buyback after it posted a stronger fourth-quarter net profit. From the Wall Street Journal:
The Japanese carmaker said Wednesday that net profit increased 80% from a year earlier to 997.6 billion yen ($6.45 billion) for the three months ended March. That beat the estimate of Y752.85 billion in a poll of analysts by data provider FactSet.
Fourth-quarter revenue rose 14% to Y11.073 trillion, supported by a weaker yen and strong sales growth in North America and Europe despite a sales slump in Japan due to certification issues at subsidiary Daihatsu Motor and affiliate Toyota Industries.
A weaker yen lifts earnings for Japanese carmakers, as it makes exports more competitive abroad and boosts the value of profits earned overseas in yen terms.
Toyota is also benefiting from a shift among consumers in the U.S. and some other markets to gasoline-electric hybrid vehicles from fully electric vehicles. More car buyers, worried about charging problems and higher prices, are choosing hybrids as a fuel-efficient option.
Chief Executive Koji Sato said that the argument for battery EVs had been excessive and that customer convenience is now getting more attention.
“Something would be lost in a transition that takes place at an excessive pace,” Sato said.
For the fiscal year that began in April, Toyota projected a net profit drop of about 28 percent to Y3.570 trillion. That’s being blamed on the higher cost of materials, labor and R&D expenses. In a bit of good news, revenue is supposed to be slightly up.
It also forecast that group vehicle sales will fall to 10.95 million units from the 11.09 million units it sold the previous fiscal year.
Toyota and its luxury brand Lexus expect to sell about 4.7 million hybrid vehicles this fiscal year, up from the 3.7 million units sold the previous year, and about 171,000 battery EVs, compared with about 117,000 units a year earlier.
Sato said the automaker should take steps so as not to get caught in the fierce price competition in China, adding that demand for plug-in hybrid cars is getting stronger there.
Toyota said it would be buying back Y1 trillion of its shares by the end of April of next year. That’s apparently partly being done to respond to any divestment plans from its stakeholders. It may buy back up to three percent of its outstanding shares.
4th Gear: Hyundai, Kia Settle Illegal Service Member Car Repos
Hyundai and Kia’s American financing unit will pay $334,941 to settle charges that it illegally repossessed U.S. military service members vehicles. From Reuters:
According to papers filed in Los Angeles federal court, Hyundai Capital America violated the Servicemembers Civil Relief Act between 2015 and 2023 by repossessing 26 vehicles whose owners had begun paying off their loans prior to active duty.
The Justice Department said the law required the financing arm to obtain court permission before repossessing vehicles.
It cited as an example the 2017 repossession and sale of Navy Airman Jessica Johnson’s three-year-old Hyundai Elantra, after the financing arm determined that she was on active duty but “not deployed.”
Johnson still owed $13,796 on the car, and Hyundai Capital America realized in 2020 it should not have repossessed it, court papers show.
“Members of our Armed Forces should not have to worry about having their cars repossessed while they are in military service,” Assistant Attorney General Kristen Clarke said in a statement.
Without admitting wrongdoing, Hyundai Capital America will pay $10,000 plus lost vehicle equity to each of the 26 service members, and repair their credit. It will also pay $74,941 to the U.S. Treasury “to vindicate the public interest.”
In a statement, Hyundai Capital America said it takes pride in supporting military families, and it has “already taken steps” to further its compliance with all SCRA requirements.
Over the past few years, the Department of Justice has settled several claims under the servicemember law against financing companies, including General Motors, Nissan and Wells Fargo’s financing unit.