Good morning! It’s Friday, November 22, 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: Automakers Don’t Want Trump’s EV Cuts
Before Tesla boss Elon Musk came onboard as a donor, president-elect Donald Trump made no secret of his disdain towards EVs, repeatedly bashing the tech and making all kinds of claims about its shortcomings. Since having his pockets filled by Musk, Trump has softened but still wants to cut support for EVs, slash tax breaks to help EV buyers and reduce investment in the space. That’s not a future America’s automakers are particularly excited about, it turns out.
Car companies across the US have plowed millions into electric vehicles in recent years: updating factories, expanding battery plants and rolling out a raft of new models designed to encourage America to turn to battery power. If Trump gets his way and scraps EV tax credits or slashes strict emission rules, all that investment could go to waste.
To try and prevent that from happening, EV makers have banded together and plan to campaign Trump against backtracking on America’s electric vehicle targets, reports Reuters. Brands including General Motors, Toyota and Volkswagen have all urged the incoming president to retain key tax credits for electric vehicles, as the site reports:
The Alliance for Automotive Innovation in a previously unreported Nov. 12 letter to Trump also raised concerns about vehicle emissions rules citing “federal and state emissions regulations (particularly in California and affiliated states) that are out-of-step with current auto market realities and increase costs for consumers.”
The automakers did not specify how they want the rules revised but said they support “reasonable and achievable” emissions regulations. The Trump transition team did not immediately comment.
The letter, signed by the group’s CEO John Bozzella, said automakers face unfair competition “from heavily subsidized electric vehicles and technologies exported from China” and also noted that China was implementing a regulatory framework to support deployment of self-driving vehicles.
Trump’s team reportedly wants to ax the $7,500 tax credit that’s available for electric vehicle purchasers across the U.S. Automakers have warned that doing so would stall the adoption of battery-powered models across America, however Tesla boss Musk says it wouldn’t harm his company as much.
Without support like this in place, car companies would fall well short of the targets set out by the current administration, which require 35 percent of new car sales across the country to be made up of EVs by 2032. This is thought to be the EV mandate that Trump keeps talking about, but that was also placed on the chopping block by the convicted felon.
2nd Gear: Strikes Loom At VW
The troubles continue at Volkswagen this week, after the company was given just a few years left to turn around its fortunes and even warned that factory closures were on the horizon. Now, workers at the automaker’s German plants have signaled that strike action could be coming.
Workers in the IG Metall union are currently in talks with VW about the future of the company, but talks have not yet yielded much progress, reports Automotive News. As such, the union has recommended that its members go on strike from December 1:
The IG Metall had asked VW to take a “big step” in a third round of negotiations but said the talks ended on Nov. 21 with their positions still far apart.
VW’s management had refused to rule out the prospect of factory closures in Germany, the IG Metall union’s negotiator, Thorsten Groeger, said. He added that talks would continue on Dec. 9.
Management asked questions on the plan put forward by the union to save 1.5 billion euros ($1.6 billion) through measures including reduced working hours and forgoing bonuses but did not put forward new proposals of their own, the union said.
Thousands of employees had gathered as the talks were held over wages for 120,000 of VW’s 300,000 staff in Germany, employed at six plants.
Volkswagen says it needs to make a 10 percent cut to company wages in order to remain competitive, while union members have proposed forgoing bonuses for two years to help manage labor costs at VW. The union also recommended a cut to shareholder dividends in order to help turn around fortunes at the automaker.
The suggestions were welcomed by management, but VW reportedly added that it needed “sustainable” change in order to survive. This sparked the recommendation for strike action, which could see thousands of workers walk off the job.
The escalation comes as VW continues to threaten the closure of three plants in Germany, including facilities that assemble the T-Roc, ID3 and ID4 electric SUV. The sites employ more than 10,000 workers, whose jobs are now at risk.
3rd Gear: Ford Adjusts Bronco Production As Sales Struggle
After reducing shifts at the plant building its F-150 Lightning electric pickup truck, Ford is now cutting staff at the plant that builds another of its icons: the Bronco SUV. The cut in workforce at the plant assembling the rugged SUV comes as sales of the model begin dropping, reports the Detroit Free Press.
Ford will “reassign” 400 workers from its Michigan Assembly Plant, which currently produces the Bronco SUV and Ranger pickup truck. The workers will be redistributed to the Blue Oval’s other plants in the area, as the Free Press reports:
The Dearborn-based automaker confirmed Wednesday that about 400 workers will be relocated to either the Dearborn Engine Plant or Monroe Parts Depot in the first quarter of 2025.
The action comes as Bronco sales have declined this year. Sales of the SUV are down 10% in 2024 through October.
Ford spokesperson Lars Weborg noted, though, that sales of the Bronco have rebounded in recent months.
“We are encouraged by the momentum heading into the end of the year, which, along with this production adjustment, should further balance inventory of model year ‘24 vehicles as we head into the launch of model year ‘25,” Weborg said in an email.
Ford hasn’t released data on how this will hit production of the Bronco in terms of numbers, but it’s sure to be in line with dropping demand so the automaker’s inventory doesn’t mount and spark sharp price cuts.
The cut in production of the Bronco follows similar news out of Ford Europe, where lower than expected demand for EVs is hitting Ford’s output of Explorer SUVs and production of the revived Ford Capri.
4th Gear: Mercedes Needs To Slash Costs
Volkswagen is cutting labor costs, Ford is reducing production of its most iconic models and now Mercedes-Benz has joined the party with experts warning that the automaker will slash billions from its production in the coming years.
The German automaker is hoping to cut its costs by “several billion Euros” per year, reports Euro News. The company hasn’t revealed how the ambitious cost-cutting will take shape, but it’s not expected to have a massive impact on jobs:
The company has not specified exactly how these costs will be cut. Details about potential job losses, as well as information about which departments or locations could be most impacted, has also not been revealed.
However, it is likely that most of the company’s German employees will be able to hold on to their jobs, even if these cost-cutting measures are implemented. This is mainly because of a Mercedes-Benz policy known as ‘Zusi 2030’, which protects employees from compulsory redundancies until the end of 2029.
Previously, other newspapers such as Stuttgarter Nachrichten and Stuttgarter Zeitung reported that Mercedes-Benz senior management had backed the implementation of stricter austerity measures, in a conference call.
The call to cut costs further came after the German company revealed that it had already managed to shave its fixed costs down. Now, the automaker is hoping to ramp up “sustainable efficiency,” reports Euronews, which should make the company more competitive in the changing landscape that is the car world in 2024.
