Mazda Looks To Build EVs In Mexico But It's Not Rushing Into Things

Good morning! It’s Friday, July 14, 2023, 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.

What Car Should You Buy? | Cruze into a Mazda

1st Gear: Mazda’s Master Plan

Mazda has a multi-year plan toward electrification that will ultimately culminate in the manufacturing of EVs in North America, like everyone else is trying to do now. But that part of the plan isn’t likely to come to fruition until between 2028 and 2030, CEO Masahiro Moro told the media Friday. And when it does happen, it’s likely to occur in Mexico. From Automotive News:

Mazda is planning two varieties of full electrics, Moro said.

One kind will be an EV based on an existing architecture that also accommodates internal combustion and hybrid powertrains. The other will be a dedicated EV platform. Both will be introduced in the 2025-2027 stage two, Moro said. But production is expected to begin in Japan.

Mazda has only two production bases in North America.

It has an assembly plant in Salamanca, Mexico, that makes the Mazda2 and Mazda3 small cars as well as the CX-3 and CX-30 compact crossovers. It also has a joint venture plant with Toyota in Huntsville, Ala., where Mazda makes the CX-50 crossover.

Mazda has capacity to build 150,000 vehicles a year in Huntsville.

But Moro said Mazda wants to focus Huntsville on ramping up output of the CX-50 through the end of the decade. The company has already said, for instance, that it plans to introduce production of a hybrid version there. U.S. sales of the CX-50 reached only 21,466 through June.

Mazda must also consult with its partner Toyota before introducing an EV there, he said.

“At this point, we’re not thinking about it,” Moro said of making EVs in Alabama.

As our friends at Auto News point out, Moro understands the American market. He used to be chairman of the automaker’s division in this neck of the woods. But Mazda doesn’t have the muscle to compete with the largest players in the EV space yet. Hell — it’s only recently helped itself to the benefits of having a big SUV in the range.

When the brand’s electrified platform is ready, all production will happen in Japan for the first several years. This is probably a prudent move, even if the automaker will miss out on incentives over that span. Its partner Toyota currently ships the bZ4X from Japan; so too does Nissan, which can’t yet build its new Ariya SUV in the States, like the Leaf was. If everything’s going well, four in 10 cars Mazda sells globally will be EVs in seven years’ time.

2nd Gear: VinFast Slowing

Investors of a special-purpose acquisition company that planned to merge with VinFast to get the nascent EV maker listed on U.S. stock tickers have cashed out more than 80 percent of their shares, Reuters reported Friday:

The move represents a new setback for VinFast, which had initially planned a U.S. listing on its own and has struggled to start production and ramp up sales outside Vietnam.

Vinfast earlier this year delayed plans to build a $4 billion U.S. electric vehicle factory in North Carolina. It pushed the start date for the plant to 2025 from 2024.

The Hong Kong-based SPAC’s shareholders have not yet voted on the proposed merger with VinFast, but have exercised their right to redeem shares by Tuesday this week.

Black Spade Acquisition (BSA) said that redemptions amounted to approximately $147 million. “Following the redemption (…), the amount of funds remaining in the trust account is approximately $28.56 million,” the SPAC said in a statement.

This is yet another setback, of which VinFast has had many lately. But when you consider how high the company was shooting, it’s really no surprise:

VinFast, which was founded in 2017 and began selling EVs in California this year, previously filed for an initial public offering in the U.S. to list on the Nasdaq under ticker symbol “VFS” in December last year, aiming for a valuation of about $60 billion.

For reference, $60 billion was considered the low-end for what Porsche’s initial public offering would be valued at. That one landed at $72 billion. Porsche!

3rd Gear: From Porsche To Rivian

Speaking of Porsche, former North America head Kjell Gruner left the company last week, and it seemed to come as a shock to everyone. We now have some insight as to the reason why. Gruner was lured away by Rivian, according to sources in contact with Auto News:

In his relatively short tenure as CEO, Gruner steered Porsche’s U.S. business through the pandemic and set the brand on track to hit a three-year sales high this year.

Porsche told dealers it expects U.S. sales to hit 80,000 next year, up nearly 15 percent from 2022.

Gruner’s role at Rivian is unknown, but the executive is not likely to replace founder RJ Scaringe as CEO.

With a marketing, operations and strategy background at established auto brands, Gruner could help the EV maker in various capacities. Before his most recent role, Gruner was Porsche AG’s chief marketing officer and global vice president of marketing.

Gruner joined Porsche in 1999 from Boston Consulting Group. In 2004, he left Porsche for Daimler, where he rose to director of strategy for Mercedes-Benz Cars before returning to Porsche in 2010.

Gruner is well-suited to a public company because of his background in marketing, a Porsche retailer said.

“He’s attuned to ever-changing consumer trends and knows which variants and models are likely to move,” said one of the sources, who asked not to be identified.

Rivian, of course, is also doing very well these days, and may be finally moving out of those early startup doldrums that cut short so many EV makers’ ambitions.

4th Gear: Mitsubishi Is Done With China, For Now

Business in China has been unkind to many foreign makes as of late, but it’s been particularly unkind to Mitsubishi Motors. Things are so bad that Mitsubishi has decided to suspend operations in the country indefinitely and lay off staff, while it prepares a slate of EVs with an eye toward a possible return into the market someday. From Bloomberg:

The Japanese automaker said that China’s transition away from gasoline cars to cleaner vehicles had hit its existing line up and seen sales fall far below expectations, according to a July 12 company memo that was circulated on Chinese social media.

“In the past few months, management and shareholders have tried to the best of our ability, but due to market conditions and with great reluctance and regret, we must seize the opportunity to transition to new energy vehicles. The company will resurrect after going through trials and tribulations,” the memo said. […]

The decision to shutter Mitsubishi’s China operations comes production at the Changsha plant in Hunan province was suspended in March. Chief Executive Officer Takao Kato said in May the company would try to overcome difficulties in China in response to speculation the carmaker would exist the market.

Mitsubishi saw its annual China sales peak in 2019 at around 134,500. The company produced 34,575 vehicles in the country in 2022, a rate that dwindled to 1,530 in January and then to zero in April. Mitsubishi has one electric SUV in China, the Airtrek, which only sold 515 units last year.

That’s quite the drop. Here in North America, Mitsubishi’s fortunes are looking up, because it decided to actively market the first competitive SUV it’s had in decades.

Reverse: The Day That Awesome Photo Happened

Photo: Pascal Rondeau/Allsport (Getty Images)

On this day in 1991 — 32 years ago — Nigel Mansell stopped during his victory lap at the end of the British Grand Prix to pick up Ayrton Senna and taxi him back to the pits, after the McLaren driver had run out of fuel.

Neutral: This Was A Good Speech

This has nothing to do with cars (well, it does a little bit). Fuck it, it’s Friday. By now you likely know that SAG-AFTRA has joined the Writers Guild of America in striking against the Alliance of Motion Picture and Television Producers. But if you haven’t seen SAG-AFTRA president Fran Drescher’s speech yesterday afternoon, you should watch it, because it was fired up. Which it needed to be, because the AMPTP’s plan is apparently to wait until writers and actors start losing their homes. Give ’em hell, unions.