Volkswagen's Scout Wants To Be As American As Apple Pie

Good morning! It’s Tuesday, May 30, 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.

The Ford Explorer Goes All-Electric, But Not For America

1st Gear: Volkswagen Of, For And By America

Volkswagen may be a big company, but as far as its business in America is concerned, it hasn’t taken many big swings in recent years. There was that attempt to compete with Toyota on a volume level with a cut-rate Jetta and Passat for a hot minute, which was promptly undone by Dieselgate. Since then, the brand has kept things under the radar. But a new strategy has emerged — one that The Wall Street Journal summed up perfectly in the first paragraph of a story published this past holiday weekend: “After decades of trying to sell German engineering to Americans only to end up with a tiny slice of the world’s most profitable car market, Volkswagen has a new strategy: Pretend it is American.”

The article goes into Volkswagen of America’s efforts to build Scout by itself, with a surprising degree of autonomy allowed from HQ in Wolfsburg. VW’s chief executive shakeup last year temporarily left the project in doubt, and garnering the new boss’ support wasn’t guaranteed:

Scout was one of the main projects launched under VW CEO Herbert Diess. So when Diess was ousted and replaced by Oliver Blume, the chief of VW’s sports-car brand Porsche, last September, Keogh’s plan was thrown into question.

Blume has said he wants to strengthen VW’s U.S. business, and as VW board member he had been part of the discussions about Scout. But as the new CEO, he had already begun to scrap some of his predecessor’s projects.

Last November, Keogh said, he and his team met Blume in an old warehouse on the sidelines of the LA Auto Show. Keogh showed Blume the promotional video, called “America’s Next Shot,” created by San Francisco ad agency Venables Bell & Partners.

It opens with images of wheat fields, a cowboy riding a horse on the plains, steelmaking, American flags and archival footage of Scout vehicles scrambling up hills and dirt roads. The narrator talks about the revival of American manufacturing and the Scout, saying: “It is America’s next shot. And we do not intend to miss.”

“We spent four to five hours with him in Los Angeles at the motor show and gave him a deep dive on everything as to where we are. And…he has been a powerful supporter,” Keogh said.

Former Volkswagen of America chief-turned-Scout CEO Scott Keogh appears to have found the right recipe for currying local favor as well:

Having picked a site near Columbia, S.C., Keogh and several top VW executives in February attended a working dinner hosted by South Carolina Gov. Henry McMaster at his Civil War-era mansion with a commanding view of the Broad and Saluda rivers.

Guests included South Carolina Sen. Lindsey Graham, the state’s Commerce Secretary Harry Lightsey and Richland County officials. The governor’s English bulldog Mac wove his way through the crowd, settling next to Keogh, according to participants.

Keogh showed his video and made a 15-minute pitch describing Scout as the embodiment of the American dream, McMaster recalled in a recent interview.

“It was a combination of rugged individualism, can-do spirit, American patriotism and an excellent vehicle,” the governor recalled. “Those things can climb walls. It particularly appeals to South Carolinians.”

A month later, South Carolina lawmakers approved $1.3 billion to help VW build the plant.

Scout’s TV spots are going to be really weird, aren’t they?

2nd Gear: Hyundai, Kia Still At Risk Of Theft

After the software updates, the Clubs and the insurance company freakouts, you’d hope that Kia and Hyundai owners are having an easier go of it these days. Unfortunately, the situation doesn’t appear to have significantly changed for the better — at least not yet. Again, courtesy of The Wall Street Journal:

It has been an unnerving experience for car owners such as Shanaya Dias. Her Kia Sportage was stolen last month, even after it had received the antitheft software, she said, citing service records and a Los Angeles police report. It was the third time thieves made off with the car—first in August, and again in December.

Hyundai and Kia said they are running broad campaigns to get word to customers, retailers and law enforcement about the free antitheft software, including phone calls and digital ads. But the problem continues to plague car owners, and has become a costly embarrassment for the affiliated South Korean automakers. Hyundai owns a nearly 34% stake in Kia, and the companies’ vehicles share many parts.

As of early May, around 7% of the roughly 8 million cars in the U.S. identified as having the vulnerability have received the software upgrade, although the number of fixed vehicles is growing quickly, the companies said.

Hyundai is pointing its fingers at TikTok through all of this and refusing to issue a formal recall because it’s technically not against the law to make your cars excruciatingly easy to steal. That’s pretty weak, but then Hyundai is a car company, and car companies will go to the greatest lengths not to admit fault or issue wide-ranging, expensive recalls.

The “service bulletin” course of action isn’t getting the same attention from owners, which is why there are still so many affected cars on the road with outstanding updates. But the new software itself isn’t a perfect solution, as Dias’ experience illustrates: it merely prevents the ignition from functioning if the doors are locked. So if you forget to lock your car, or auto-lock isn’t equipped on your vehicle, the patch won’t make much difference.

3rd Gear: NHTSA Ends Tesla Gaming Probe

At the end of 2021, the National Highway Traffic Safety Administration opened an investigation into Tesla’s support for video games on the central infotainment display while in motion. The probe had the intended effect, forcing Tesla to quickly issue a patch that deactivated games unless shifted into park, so the department has consequently concluded the effort. Per Reuters:

Shortly after NHTSA opened its investigation into Tesla’s “Passenger Play” in December 2021, Tesla agreed to stop allowing video games to be played on vehicle screens while its cars are moving. NHTSA said Tuesday it was not seeking a recall of the vehicles but said its analysis of data provided by Tesla “produced significant concerns about driver distraction during the time that it was available.”

NHTSA said in closing the investigation without seeking a recall it was not indicating “a finding by NHTSA that no safety-related defect exists. Furthermore, it does not foreclose the agency from taking further action, if warranted.”

Tesla, which did not immediately respond to a request to comment, told NHTSA that no consumer complaints or collisions had been reported concerning the use of Passenger Play in the subject vehicles during a year of use.

NHTSA said that a month after Tesla voluntarily disabled Passenger Play capability with an over-the-air software update it reported a 97% completion rate. NHTSA’s investigation covered Tesla vehicles sold since 2017 that had the feature.

NHTSA said “apparent driver use of Passenger Play while not in Park in approximately a third of the trips in which the feature was in use demonstrates the importance of affirmative technology-based lockouts over administrative controls such as labeling or disclaimer screens.”

That’s right: a third of the time someone was playing a game in a Tesla prior to the update, the car was moving.

4th Gear: Stellantis Must Construct Additional Pylons

Stellantis CEO Carlos Tavares said Tuesday that if the company is to reach its global production target of 400 gigawatt-hours by 2030, it needs another two battery plants in North America, where two are already in development. From Reuters:

Speaking to journalists at the inauguration of a so-called gigafactory in northern France, Tavares said the Franco-Italian carmaker would need more similar plants in North America, where it already announced plans for two sites.

The U.S. Inflation Reduction Act had created “very favourable” investment conditions in the country, Tavares added. […]

It has already announced a plant in Canada and one in the U.S. state of Indiana, on top of three European gigafactories with a total capacity of 120 GWh.

“Need” is a strong word though. How many EVs will Chrysler, Dodge, Jeep and Ram actually have by then? The Airflow doesn’t appear to be getting here anytime soon, after all.

5th Gear: Toyota, Daimler Truck Join Forces

Believe it or not, Daimler Truck owns almost 90 percent of Mitsubishi Fuso — Mitsubishi only owns the remaining 10. Toyota, of course, operates Hino. The two companies will pool resources to command the commercial truck market in Japan, they announced this week. Courtesy Reuters:

Under the memorandum of understanding (MOU), the businesses of Daimler-owned Mitsubishi Fuso Truck and Bus Corp and Toyota subsidiary Hino Motors Ltd would be combined under a holding company, they said in a statement.

The shares of the new company are expected to be listed on the Tokyo Stock Exchange’s prime market.

The companies see the tie-up as an opportunity to achieve the scale they need to make technological advances, Daimler Truck CEO Martin Daum told a press conference in Tokyo.

“We are accelerating towards zero emissions, but there is one major challenge and this is the required funding,” Daum said. “There is only one way to make this parallel tech development work: economies of scale.”

The sales organisation globally will remain separate, but the two companies will pursue joint development, procurement and production, he said.

Daimler Truck and Toyota will invest in the company equally and cooperate on the development of hydrogen and other technologies in areas such as connectivity and autonomous driving, their statement said.

Hydrogen would be the “future” of automotive mobility, as it was the solution to carbon neutrality, Daum added.

A “definitive agreement” is to be signed in early 2024, before the holding company is created and the two brands are together under one roof by the end of the year.

Reverse: First Kiss

On this day in 1911 — 112 years ago — the inaugural Indianapolis 500 was held. Technically, this didn’t mark the first kiss of the bricks: that actually came in 1996 when Dale Jarrett won NASCAR’s Brickyard 400. From History.com:

Neutral: Did You Catch Any Racing This Weekend?

I was on top of a mountain with no TV or internet. It was nice! But it felt weird missing Indy for the first time in some years.