#Suppliers

Volkswagen CEO Herbert Diess shot down rumors of a potential investment in electric car maker Tesla on Thursday, shortly after a German magazine claimed the VW boss was hot for the idea.

Manager Magazin, whose English translation is unknown, reported that the American automaker’s battery and software prowess had Diess thinking of a share buy, with an unnamed VW manager claiming the CEO “would go in right away if he could.”

ZF Friedrichshafen has agreed to supply Fiat Chrysler with its second-largest order to date. While top honors belong to BMW, FCA will be using the same eight-speed automatic transmissions sourced for the Bavarian-based applications. “Optimized for electrification” as per ZF’s press announcement, the gearboxes are designed for longitudinally mounted engines ⁠— including those utilizing hybrid systems.

Already a pioneer in hybrid drive technology, Toyota’s recent push towards fully electric cars has birthed a joint venture with one of the world’s premier battery makers, potentially opening up a massive revenue stream for the automaker.

On Tuesday, the company announced the creation of a joint venture with Panasonic to supply other automakers with a “stable supply of competitive batteries.”

By all accounts, the Hyundai Kona Electric is a zippy little crossover endowed with surprising range and the same basic utility as its gas-powered sibling, minus the whole all-wheel drive thing. However, a battery shortage afflicting the Korean automaker has added uncertainty to a model arriving on American shores this year.

Will it actually show up when a customer wants one?

Don’t worry about that, Hyundai’s telling dealers. There’s a plan to get Kona Electrics to America.

A key goal of Fiat Chrysler Automobiles’ financial fitness regimen, started under former CEO Sergio Marchionne, has come to pass under his successor, Mike Manley.

On Monday morning, FCA announced the sale of its Italian parts unit, Magneti Marelli, to Japan’s Calsonic Kansei, itself owned by KKR & Co. The deal, worth $7.1 billion, sees the parts unit don the name Magneti Marelli CK Holdings. It’s likely very good news if you’re an FCA shareholder.

Agreements forged between automakers and suppliers aren’t etched in stone, and shaky financial ground has a way of altering how and when those suppliers are paid. Look back to the recession for prime examples of that.

However, a memo sent from Tesla to a supplier shows the electric automaker wants to recoup a portion of its previously spent cash — a request designed to help Tesla finally turn a profit.

As the United States considers imposing new tariffs of up to 25 percent on imported automobiles and parts, the industry has rallied together to stand against the proposal. Manufacturers already made individual cases for themselves and are now dropping very bleak-sounding industry projections on the U.S. Commerce Department in the hopes of changing the administration’s mind.

However, President Donald Trump continues to promote the imposition of tariffs to force a sort of economic justice. For years, China’s protectionist policies regarding automobiles forced American manufacturers to build inside its borders and partner with Chinese firms for years. That’s something Trump claims could be a national security risk. China also recently upped its tax on American-made autos to 40 percent, shortly after promising to lower them. Meanwhile, Europe still holds a consistently higher tariffs on imported cars than the U.S., except for light trucks.

Commerce Secretary Wilbur Ross seems aware that China may have gamed the system in its favor, but appears less convinced that it’s a matter of national security. On Thursday, during a hearing on the probe into the industry, he said it was “too early” to say what the United States would do. Meanwhile, auto groups continue to make their terrifying case. (There’s also quite a bit of rolling PR in downtown D.C. today, as you’ll see below.)

Yesterday’s post about Nissan’s struggle to adapt its novel e-Power system to larger, American-friendly vehicles reminded this writer of a product Bosch unveiled last year. Called the eAxle, the compact, lightweight unit is comprised of an electric motor, associated electronics, and transmission.

Basically, it would allow an automaker to easily and cheaply convert a vehicle to electric drive, or include it as part of a gas/electric hybrid offering. Outfitted with an eAxle in the rear, a car could actually become two wholly distinct vehicles — a conventional front-drive, gas-powered vehicle as well as a rear-drive battery electric vehicle. A 201 horsepower eAxle apparently weighs less than 200 pounds installed, and Bosch claims it can downsize and upsize the unit to deliver between 60 and 400 horses.

Intriguing. After reading about it last year, I entertained fantasies of switching off my car’s ICE while stuck in traffic and going gas-free rear-drive, then switching back while on the highway. Or maybe I could turn my lowly economy car into a gas/electric all-wheel-drive monster.

How would you put the eAxle to work?

Not if you’re planning on leasing a Clarity Electric, of course, though future iterations of Honda’s greenest model could use what General Motors is pushing. Which is: a far more energy dense battery.

On Thursday, the two automakers announced a partnership to develop smaller, longer-ranged batteries for use in electric vehicles, primarily those sold in North America. Once the two achieve a breakthrough, GM will become Honda’s supplier.

Toyota Motor Corp. says it had reached an agreement to consolidate all of its core electronics component operations within Denso. The move should allow Toyota to free up resources to compete more effectively in the new vehicle technology field.

Japan’s largest automaker noted it still has to discuss the logistics of transferring production of parts produced at its Hirose plant, near Toyota’s global headquarters, before the end of next year. But Denso, the company’s largest supplier, has already agreed to the core concept of the deal. By 2022, Denso will have taken over the mass production of all electronics components used in Toyota’s vehicles.

Mobileye, the Israeli company that supplies camera-based driver assist technology to a host of automakers, just received a black eye.

While one of its Ford Fusion Hybrid testbeds cruised through the streets of Jerusalem to show off its autonomous driving abilities, the sedan, equipped with 12 cameras (three of them forward facing), four advanced EyeQ4 chips, and a television audience, drove merrily through a red light.

It’s technically not the car’s fault, Mobileye said. It’s the TV crew’s.

It was a drama “worthy of a James Bond script,” the Detroit Free Press‘ sensational headline announced. Ford spokesman Mike Levine provided a hashtag-heavy rundown of the operation’s timeline via Twitter. The automaker even felt it worthy of a lengthy media release.

Never has a supply chain disruption provided a car company so much positive PR.

As we told you yesterday, Ford announced it will temporarily halt production of the F-150 and Super Duty after a fire at Meridian Magnesium Products of America knocked out a key supplier. While the Blue Oval isn’t the only automaker affected by the supply shortage, as General Motors, Fiat Chrysler, BMW, and Mercedes-Benz also report the likelihood of production interruptions, Ford has the most to lose.

Taking the company’s most profitable vehicle out of the mix for a few weeks is a big deal. During a bad month, Ford might sell around 50,000 F-Series trucks in the United States. But a good month can see around 90,000 deliveries, so an unplanned idle probably has the automaker tugging at its collar a little. Fortunately, Ford currently has a 84-day supply of F-series pickups. That doesn’t mean it won’t feel the pinch if the wait on parts takes longer than expected.

The factory shutdown affects F-150 production at the Ford Kansas City Assembly Plant, which Ford said will last until at least May 14th. Super Duty lines at Kentucky Truck and Ohio Assembly have also shut down. Ford’s Dearborn Plant is expected to go down temporarily in the near future.

So, how far have the ripples spread?

Car building will soon fire up again at Fiat Chrysler’s Brampton, Ontario assembly plant after employees at a just-in-time seat supplier called of their week-long strike. Late Friday, workers at Lear Ajax ratified a four-year wage contract with their employer.

Brampton Assembly, which builds the Chrysler 300, Dodge Charger, and Dodge Challenger, cancelled both shifts on Thursday after exhausting its limited seat supply. The new agreement between Lear and its Ajax workforce not only keeps seats flowing to FCA, it also keeps Lear from closing its doors for good.

Fiat Chrysler Automobiles cancelled both shifts at its Brampton, Ontario assembly plant Thursday, stemming the flow of Chrysler 300, Dodge Charger, and Dodge Challenger models.

Blame the work stoppage on a lack of seats. Brampton’s just-in-time supplier, Lear, saw its workforce go on strike last weekend after failing to reach a collective-bargaining agreement. However, a new wrinkle in this relatively commonplace labor action is that Lear plans to close its plant.