#Strategy

Ford will be scaling down future investments in China, as the company’s chief executive has suggested that there will be “no guarantee” Western automakers can compete with local electric-vehicle rivals. This should have been obvious to American manufacturers who have historically been required to engage in partnerships with Chinese corporations just to sell within the region. But it also speaks to hardships Ford has endured while trying to break into the market.

Ford Motor Company is tweaking plans in China and seeking to turn around financial losses after five years of lackluster sales within the region. The new strategy will be focused on exporting to other countries, commercial product, and reinforcing the necessary supply chain for all-electric vehicles.

General Motors has an important investors meeting coming up this week and the keystone item will be explaining how profitable its planned shift toward electric vehicles will eventually be. Details of GM's presentation have leaked and, if the claims are true, leadership should be spending a substantial portion of November 17th explaining exactly how EVs will become money-makers for the business by 2025.

BMW Chief Executive Oliver Zipse has said that despite the automaker’s status as a luxury carmaker it would not be abandoning lower-priced segments while it swaps over to electric vehicles. Though the general trajectory for the Bavarian marquee – and the automotive industry in general – over the last several years has been to chase higher margins by focusing on pricier, often larger, vehicles and clever packaging.

Hyundai Motor Group – which includes Hyundai, Kia, and Genesis – has announced a comprehensive plan for its products from 2025 onward with the key components being perpetual connectivity, subscriptions, and software-defined automobiles. It sounds benign but actually represents a major shift in the way the company operates by calling for widespread platform standardization and leaning into novel revenue streams reliant on vehicles existing on its corporate network.

Stellantis has announced a new business unit dedicated to fostering a “circular economy” that should help it reach carbon neutrality by 2038. The arm is also supposed to net the automaker a breezy €2 billion ($1.95 billion USD) in revenue while setting itself up to have more direct control of its products in the future.

Tesla executive Martin Viecha has reportedly shared some of the automaker’s short-term goals with investors during an invite-only Goldman Sachs tech conference held in San Francisco on Monday. As the company rarely engages in any form of public outreach and scrubbed its PR department in 2020, leaks from the event immediately became newsworthy.

Nissan and Renault opted against a full merger on Wednesday, but neither side seemed to feel now was the time to disband the alliance and see how they might fare as a solo act. Every member of the Renault–Nissan–Mitsubishi Alliance took time to address financial concerns last year, encouraging further product integration as a cost-mitigation strategy. Despite Nissan shareholders and staff clearly losing interest in the French-led confederation, the brand seems to understand that leaning upon its allies might be the only way to get through a period of increasing economic uncertainty.

Mitsubishi slashed its 2020 financial forecasts ahead of the coronavirus pandemic by over $500 million while the other two issued numerous profit warnings in the latter half of 2019. Now the world is exiting lockdowns and assessing the economic damage they caused. Obviously, this is not the time to be burning bridges, even if some alliance partners aren’t enthralled with what’s probably waiting on the other side.

A struggling Nissan sees the U.S. market playing a bigger role in the company’s sales future. Ahead of the release of its near-term recovery plan, expected later this month, the automaker sees new product as the key to firming up its flagging U.S. presence.

Elsewhere, a report out Friday claims Nissan’s new plan will see the U.S. account for a third of the automaker’s global volume. With all of this in the works, it’s perhaps no surprise that the company’s North American arm saw a sudden resignation.

Nissan’s new restructuring plan, due out at the end of the month, is coming together, and it seems the document will spell out which members of the Renault-Nissan-Mitsubishi alliance will go where. In the interests of efficiency and not stepping on each other’s toes, sources claim the plan will see each automaker pour themselves into key markets, rather than competing against each other.

This will have the effect of making maximum use of resources.

For the Nissan brand, that means North America, China, and Japan will become its main stomping grounds.

General Motors offered up a peak at its electric vehicle strategy in Warren, Michigan Wednesday, pulling the sheet back on a product plan that seeks quick profits as well as CO2 reduction.

Underpinning GM’s drive for domestic EV supremacy is a piece of modular architecture and a new battery type that should proliferate through divisions and segments in the coming years. The company claims these vehicles will not be the equivalent of the defunct, unloved Fiat 500e, a compliance vehicle that late Fiat Chrysler CEO Sergio Marchionne once warned consumers not to buy. Despite the EV game carrying steep costs and significant risk, GM’s not in the business of losing money if it can help it.

Oh, and that upcoming Cadillac crossover now has a name.

One of the bigger stories this year, albeit one that occurred mostly in the background of splashier news, concerned a fun-to-drive compact car that did pretty well for itself over the past decade. For 2019, that car got a makeover and a push upmarket, aligning it more closely with other models in the lineup. That car was the Mazda 3 — and the 2019 model year brought big changes not only to its content, but also its price.

Gone was the American-market’s base 2.0-liter engine and most of the model’s manual transmission availability, and these omissions played an obvious role in inflating the model’s entry price by roughly three grand. Looking back on the sales decline that marked the new 3’s entry to the market, Mazda’s leadership is expressing regret.

Volkswagen Group has decided to increase spending on the development of electric and digital technologies over the next five years to 60 billion euros ($66 billion USD). The automaker estimated the revised strategy amounts to slightly more than 40 percent of its investments in property, plant and equipment, and all research and development costs during the planning period.

Of that sum, 33 billion euros are expected to go directly toward the development of new electric vehicles. The increase allocates roughly €12 billion annually for hybridization, electric mobility and digitalization. The old plan set aside 8.8 billion euros per year.

The man who once helped outfit Mitsubishi’s lone American assembly plant will soon head the company he joined back in 1984. He also wonders what can be done about the brand’s existence in the United States.

Takao Kato, 57, steps into the shoes of outgoing CEO Osamu Masuko on June 21st — a move that comes as the automaker’s membership in the Renault-Nissan Alliance faces uncertainty in light of merger overtures from Fiat Chrysler. In a news conference held before the merger news, Kato mused about the company’s limited presence in North America, promising changes ahead.

Mitsubishi has quite the storied history, but for car lovers things don’t really kick off until the 1970s, when the company spun off Mitsubishi Motors from its Heavy Industries division. With help from Chrysler, the Japanese company managed a foothold in North America and started escalating volume. Before long, Mitsubishi was delivering economically minded vehicles to the American masses while fleshing out its lineup to include sporting models.

By the 1990s, Mitsubishi was the underdog option for discerning import enthusiasts. But all of those spectacular models gradually started to vanish. The 3000GT disappeared from the market, the Eclipse morphed into an overweight cruiser without the option of all-wheel drive, the Galant lost its excellent VR-4 variant, and the company never bothered to replace any of its previously discontinued performance models to pick up the slack. Eventually, Mitsubishi even abandoned the beloved Lancer Evolution due to hard times.