Stellantis Eyes Joint Venture To Take On China

Good morning! It’s Thursday, August 24, 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 today.

1st Gear: Stellantis Has Its Sights Set on China

It’s no secret that global automakers want to succeed in China, which is the largest car market in the world, filled with local brands that are bringing the fight to established players. Now, automakers that haven’t had a footing there in the past are seeking tie-ups with Chinese brands to find a way in.

In recent years, firms like BMW and Toyota have deepened their ties with China, and now Stellantis appears to be making similar moves. According to a report from Reuters, the Jeep owner is investigating a tie-in with Chinese electric vehicle (EV) maker Zhejiang Leapmotor. The site reports:

Considerations for a tie-up are ongoing and no final decisions have been made, the report said, citing people familiar with the matter.

Global carmakers, including Germany’s Volkswagen, have also expressed interest in a potential tie-up with Leapmotor, the report added.

A deal with a company like Zhejiang Leapmotor would allow Stellantis to offer its cars in China, as a mandate requires foreign automakers to set up joint ventures with domestic car companies if they hope to produce and sell their models in China. A cap of 50 percent is placed on foreign automakers’ ownership of Chinese businesses.

China is now the world’s largest car market and remains dominated by local brands like Great Wall Motors and Wuling Motors.

2nd Gear: The UAW Is Already Practicing Picketing

There’s just three weeks to go until the United Auto Workers union’s contract with America’s Big Three automakers is set to expire. Both parties are stuck around the negotiating table trying to secure a new deal, but things aren’t looking too promising as it stands, with the automakers and unions disagreeing over things like pay, working hours, and benefits.

Now, as the union carries out its strike authorization vote, members of the UAW have started to get their laps in as they practice picketing at Ford, GM, and Stellantis sites in America. According to the Detroit Free Press:

As UAW members marched on Detroit’s east side Wednesday under an overcast sky following earlier rains, their chants and signs echoed many of the same themes that union leadership has been preaching for months:

“Equal work for equal pay. All the tiers must go away.”

“Record profits. Record contracts.”

It was a stream of members wearing red, the color of solidarity, and marching along Conner, near Stellantis’ Detroit Assembly Complex-Mack plant. It was also the first of three practice pickets announced by the union this week as the United Auto Workers union continues bargaining with Ford Motor Co., General Motors and Stellantis, which owns the Jeep, Ram, Chrysler, Dodge and Fiat brands. Pickets are also scheduled on Thursday and Friday near Ford’s Kentucky Truck and Louisville Assembly plants, respectively.

The UAW contract with the Big Three is due to expire at 11:59pm on Thursday, September 14. After that point, members will be hoping a new contract has been reached, or they will be ready to strike – depending on the result of the ongoing strike ballot. The vote to authorize a strike was called last week, and CBS News reports that the results of the vote could be announced later today.

3rd Gear: GM Cuts 940 Jobs in Arizona

While UAW members are fighting to improve their jobs at the Big Three, General Motors has been making cuts to its workforce across other areas of its business. According to a report from Automotive News, the Chevrolet owner has cut more than 900 jobs and will close one of its facilities in Arizona.

According to the site, GM is preparing to shutter the IT Innovation Center in Chandler, AZ, in October where it currently employs 940 workers. Automotive News reports:

Most of the roughly 940 workers at the center are on GM’s corporate IT support team. Some employees will continue to work in Arizona on software-defined vehicle technology, Kelly told Automotive News. Employees whose positions are terminated can apply for open positions until the end of October, [company spokesperson Kevin Kelly] said.

The IT facility, which opened in 2014, is one of four such sites operated by GM, with the three others being in Warren, Michigan; Roswell, Georgia; and Austin, Texas.

The decision to close the Arizona site and cut the 940 jobs that are based there comes shortly after GM announced that it was cutting 200 engineering jobs from its sites across the country. Those cuts, GM claimed, were all about “reduce complexity” at the automaking giant.

4th Gear: Plug-In Hybrids Might Be Around For A While

By now, everyone knows that pretty much every automaker out there is making the pivot to EVs. We’ve got an electric VW bus, a battery-powered Escalade and even a plug-in Lamborghini all on the way. And in all this excitement, it might have seemed like plug-in hybrids were the forgotten middle child of the car world.

However, a new report from Reuters suggests that the plug-in hybrid might still have some life in it yet, with experts suggesting that it could be a staple of the car world for at least the next five years. Reuters reports:

Interest in hybrids is rebounding as consumer demand for pure electrics has not accelerated as quickly as expected. Surveys cite a variety of reasons for tepid EV demand, from high initial cost and concerns about range to lengthy charging times and a shortage of public charging stations.

S&P Global Mobility estimates hybrids will more than triple over the next five years, accounting for 24% of U.S. new vehicle sales in 2028. Sales of pure electrics will claim about 37%, leaving combustion vehicles — including so-called “mild” hybrids — with a nearly 40% share.

The rebound comes as Ford outlines its ambitions to “quadruple” its sales of hybrids over the next five years. At present, the Blue Oval’s lineup of plug-in models includes the Escape and the Fusion. Stellantis is also set to join the plug-in party, which at present is mostly dominated by cars from Toyota.

Reverse: Pluto Gets Demoted

On The Radio: The Vaccines – “I Can’t Quit”

The Vaccines – I Can’t Quit (Official Video)