China’s Automakers Are Ready To Take Over
Happy Friday! It’s August 11, 2023, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are all the important stories you need to know today.
Take A Lap With Us In Honda’s ‘The Beast’
1st Gear: Out With The Old
It’s no secret that the Chinese auto industry is booming right now. NIO is out here making electric vehicles with swappable batteries a reality, BYD is about to take over Ford’s old factories in Brazil to boost production, and Geely is now the brains behind legacy companies like Volvo and Lotus. Now, automakers in the country want to take this momentum and run with it.
At an event this week, BYD claimed that it was time to “demolish the old legends” while celebrating a production milestone for Chinese automakers. According to Reuters, BYD founder and chairman Wang Chuanfu stood in front of an image of 12 Chinese automaker logos and proclaimed that “the time has come for Chinese brands.” Reuters reports:
At its event on Wednesday, BYD released a video marking the founding of a dozen rivals from state-run automaker FAW Group in 1956 to commercial EV startups Xpeng, Nio and Li Auto in the past decade.
The video shows historical footage, sweeping vistas and cars being loaded for export. “Our stories are different from each other but share the same direction,” the narrator says, adding in reference to overseas markets: “There’s no distinction between ‘you’ and ‘me’.”
It ends with a call for China’s automakers to “demolish the old legends and achieve new world-class brands,” under the slogan, “Chinese Autos”.
All very rousing, I’m sure you’ll agree. Understandably, that’s been met with both praise and criticism from across the industry. Some claimed the messaging made them feel proud to be Chinese, while others warned that it could lead to increased scrutiny and regulatory risks for Chinese automakers operating overseas.
But what do you think, at the rate they’re growing could companies like BYD and NIO one day outsell Ford and GM here in the U.S.?
2nd Gear: VinFast Becomes A Real EV Startup
And speaking of growing automakers, let’s discuss Vietnam’s rising star VinFast. Despite facing some troubles along the way, VinFast is checking off all the essential steps for the modern EV startup. It’s had some fun concept cars, been hit with a few delays, and finally begin shipping cars to the odd customer. Now, it’s ticking off the final box and will launch on the stock exchange following a SPAC merger.
Merging with a special purpose acquisition company (SPAC), has proven to be a popular way for EV startups to raise capital in recent years. In recent years, we’ve seen Polestar take this tact, Lucid managed to navigate the process successfully and Harley Davidson even managed it for its electric bike brand LiveWire. Now, Automotive News reports that VinFast will do the same.
According to the outlet, VinFast plans to start trading on the Nasdaq next week after it merged with the Black Spade Acquisition Co on Thursday. Automotive News reports:
Black Spade Acquisition Co. shareholders on Thursday signed off on the combination with the manufacturer. VinFast expects to debut on the Nasdaq on or around Aug. 15 under the symbol VFS. The deal values the company at about $23 billion, a statement last month showed.
The planned Nasdaq listing, confirming an earlier Bloomberg News report, caps VinFast’s years-long efforts to become a publicly traded company. The manufacturer is selling made-in-Vietnam EVs and is currently building a factory in the U.S.
The funding raised from the flotation will be vital to recoup some of VinFast’s ever-growing costs. The company is hoping to expand its global footprint, which takes a lot of money to do right, and has already had to fork out on recalls of the cars it shipped to America.
3rd Gear: We’re Still Talking About The Chip Shortage
You know what we haven’t discussed in a while, the crumbling supply chain that’s hitting the auto industry as a result of Covid-19 and Russia’s invasion of Ukraine. Well, guess what we’re going to talk about now?
After chip shortages dominated the headlines in 2021, delaying new cars, causing backlogs at dealerships and leading automakers to scrap features from some models, the rush for silicon is back in the news. According to a report from Reuters, the effects of the shortage of computer chips essential to new cars could impact the industry for up to a decade.
Reuters specifically looked into Germany’s auto industry, which is home to companies like VW, Audi, BMW, and Mercedes. It found that the supply of semiconductors across the country has “created bottlenecks for Germany’s car industry” that could take “years to resolve.” The site reports:
“It takes years, after all. It’s about billions of dollars being invested,” Renate Vachenauer, head of procurement at Volkswagen-owned Audi, was quoted as saying by Augsburger Allgemeine newspaper.
Vachenauer said carmakers could ease the bottlenecks by reducing the varieties of chips used from the 8,000 different types in vehicles today.
In an effort to ease the strain on its automakers, lawmakers in Berlin have been offering subsidies to some of the world’s largest chipmakers to encourage them to set up shop in Germany. According to Reuters, chipmakers Intel and TSMC have so far announced plans to build factories in the country.
4th Gear: We Need Better Air Filters
Anyone that’s been driving around the Pacific Northwest, America’s northeast, or areas of Canada this summer will have noticed that, try as you might, it’s incredibly hard to stop wildfire smoke from creeping into your car. No matter how far in advance you set your car to recirculate, the smell of smoke seems to always find a way.
Well now, a report from Bloomberg found that air filtration systems in most cars might not be up to the task of filtering pollutants from the air we breathe. And in order to make better filters that are up to the task we should look to one specific automaker: Tesla.
According to the report, global carmakers are now playing catchup with Tesla in the air filtration race, which might be one of the least exciting competitions in the car world right now. But it’s an important one, as Tesla’s ridiculously-named Bioweapon Defense Mode recirculates cabin air through a HEPA filtration system that can cut PM2.5 pollution by up to 40 percent. That’s important, as exposure to this kind of pollutant matter can trigger things like coughing, stinging eyes and breathing difficulties.
After people were encouraged to mask up when smoke from Canadian wildfires brough PM2.5 matter into the U.S., automakers began to take note. Now, Mercedes is reportedly working on better filtration in models like its EQS sedan anbd EQE SUV, which was even put to the test during the worst days of smoke this year. According to Bloomberg, the car’s filtration was able to cut the outside air quality index from an eye-watering 350 down to just 23 inside the cabin.
Clearly, if these are events that we’re going to have to live with while the planet warms and changes, we’re all going to need a way to drive around town safely.
