Aston Martin's first utility vehicle key to sales growth plans
Aston Martin CEO Andy Palmer said the company's first utility vehicle arriving later this year will be crucial for the British luxury-car maker, which is trying to revive sales growth and rebuild investor trust.
The DBX will add about 4,000 units to annual deliveries after its launch in late 2019, Palmer told reporters in Tokyo. The automaker cut its overall sales target for this year by 11 percent last month to a minimum of 6,300 cars.
The DBX will be the biggest step yet in Palmer's campaign to win over buyers and regain investor confidence in the Gaydon, England-based automaker. Waning demand in the U.K. and Europe have left Aston Martin's stock valued at a quarter of its initial public offering price just 10 months ago -- the worst-performing new listing on London's main market in more than two years.
"The key, of course, is DBX," Palmer told reporters at the brand's dealership in central Tokyo. "When you see DBX, when you hear DBX and when you drive DBX, it should shout Aston Martin at you."
Palmer didn't rule out raising more funding should Aston Martin need to replenish its declining cash pool. The company generated about 900,000 pounds ($1.1 million) of cash from operations in the first half, the lowest since it started to disclose earnings, according to data compiled by Bloomberg.
"In a public market in the U.K, probably the investors would prefer that you had more cash," Palmer said. "If we felt that we needed more money, then we would step to an instrument which we understood, which will be to go to the debt markets and raise more debt."
The DBX will compete with the Porsche Cayenne and Macan, the Bentley Bentayga, and the Lamborghini Urus. Adding a utility vehicle is a tactic that's worked for Bentley, which has doubled production numbers with the Bentayga, and for Porsche, whose $50,000 Macan is the company's best-selling vehicle.
While Palmer said the stock-market reaction doesn't change Aston Martin's plan of introducing seven new models in seven years since 2016, analysts are downbeat. They lowered the average one-year target price for the stock by 43 percent in the past three months, with Credit Suisse's Daniel Schwarz recently slashing his estimate by more than two-thirds.
Meanwhile hedge funds have taken record short positions in both Aston Martin's debt and equity, the Financial Times reported, citing data from IHS Markit. The cost of borrowing the company's sterling-denominated bonds has risen to the highest of any U.K. corporate debt, according to the report.
"Short-sellers are taking the opportunity of 2019 being an increasingly difficult year -- wholesale not quite enough, difficult market in the U.K. and Europe," Palmer said. "And because Brexit moved -- used to be end of March and now it's end of October -- it's not reasonable to assume that somehow the market is going to come back."
Honda, Hyundai Join Growing List of Automakers Electrifying Motorsports Programs
While battery power is still struggling to gain traction in the consumer market, it is accelerating fast on the race track as a growing number of motor sports series - and automaker race programs - adopt various forms of electrification.
Two of the newest manufacturers set to plug in are Hyundai, which will preview an all-electric race car at the Frankfurt Motor Show next month, as well as Honda, which says it will return to next year's IndyCar series with a hybrid-powered racer delivering "more than 900 horsepower."
"Racing has long been a crucible for the development of new technologies and people at Honda and this direction will enable us to promote a technology through racing that is essential to the future of our automobile business," said Ted Klaus, president of Honda Performance Development.
The two announcements come just weeks after the conclusion of the fifth season of the Formula E series. That's an all-electric program that has gained significant momentum over the last several years.
Earlier this month, IndyCar announced that it will switch to hybrid technology with the launch of the 2022 series. Both Honda and its arch-competitor Chevrolet will join in on the switch.
Hyundai offers a tease of what its hybrid race car.
As with a conventional hybrid vehicle, the powertrains for the open-car race series will pair an internal combustion engine with an electric drive system though, in this case, that will be one specifically developed for motorsports using a "multi-phase motor, inverter and electric storage device that will create energy recovery from the car's braking system."
Currently, IndyCars can produce as much as 700 horsepower. That will jump to 900 with the hybrids, but that could understate the boost batteries will give since electric motors can generate 100% of their torque the moment they switch on.
IndyCar actually is a belated entry into hybridization, following both Formula One - which introduced the kinetic energy recovery system, or KERS, to racing - and the Le Mans endurance race series.
What is unclear is where Hyundai plans to take the all-electric race car it says it is developing, and which it will introduce at the Frankfurt Motor Show a month from now.
Honda is returning to IndyCar with a 900-hp hybrid.
There is speculation that the project could be teaming Hyundai with battery supercar company Rimac. The Korean automaker in May announced it would invest $90 million in the Croatian start-up, though it was vague about what their plans were beyond developing an EV model that would become part of Hyundai's new "N" performance sub-brand.
While offering a brief teaser of the car - which looks to be a small hatchback - Hyundai has little to say beyond a terse statement noting, "The move to electric continues the growth of Hyundai Motorsport, which has become well established in rallying and circuit racing since its inception in 2012. The multiple rally-winning WRC team, now in its sixth season, is currently leading a closely fought Manufacturers' Championship."
The Formula E series wrapped its season with two races on a makeshift track in Brooklyn.
Could Hyundai be targeting the World Rally Championship or perhaps even setting up a series of its own for the upcoming all-electric racer? That wouldn't be unique. Jaguar set up the I-Pace e-Trophy series to pair with Formula E.
"I think (all auto racing series) will have to go electric or they will have no relevance," Alejandro Agag, the founder and organizer of Formula E told TheDetroitBureau.com last month.
While few motorsports analysts expect to see battery-cars completely take over anytime soon, what's clear is that, as electrification becomes more the norm than the exception, both automakers and auto racing organizers are looking to stay ahead of the curve.
Look up the array of cars and SUVs BMW is selling these days, and it will blow your mind if you are a BMW fan who has driven the same ride for the last 20 years and want to re-up.
It used to be the 3 Series, 5 Series, 7 Series, the X5, a Z sports car, M Cars, and each had a handful of engine and body style derivatives. Today, the models are like balls in a McDonald's ball-play room. The 2 Series, 4 Series, 6 Series, 8 Series, X1, x3, X6, X7, M cars, the i-Electrics, special edition models. It is complexity on wheels, and a bunch of these models just don't sell.
BMW, though, is replacing its Chairman of the Board of Management Harald Krueger with Oliver Zipse, and when he sits in the chair come the middle of August, he'll have the hedge trimmers out. According to Automobile Magazine, management is canceling the convertible version of the 2 Series, the standard-wheelbase 7 Series, the X2, the coupe and convertible variants of the 8 Series, and the next-generation Z4. That's a start.
BMW is becoming more of a true sport-utility brand. BMW has reportedly, according to Automobile, an SUV X8 that will have a plug-in EV option with up to 60 miles of electric range. An X8 M is also in the pipeline, which of course would come with a serious performance package.
BMW is faced with enormous challenges, like other companies, even more so perhaps. The company has long been associated with a sporty driving experience-The Ultimate Driving Machine-and the coming world of electrification is not seen as glamorous and cool as the internal-combustion-engine (ICE) world of BMW's engines and stiff chassis.
Of course, that is largely perception. While EVs are still hampered by range issues for most companies, EVs can go zero-to-sixty faster than ICE vehicles. BMW largely has the technology to make EVs every bit as fast and sporty as Tesla EV vehicles, but it must navigate the transformation in a way that does not put too much investment ahead of the consumer and the marketplace, while guarding quarterly profitability.
BMW lost money on its automotive business in the first quarter of the year after it was hit by a 1.4 billion euro ($1.6 billion) charge for an antitrust case and by higher upfront costs for new technology. The financial services and motorcycle divisions kept the group in the black. Both the BMW and MINI brands are both feeling enormous competitive pressure.
Still, BMW knows that EVs are growing, in China, Europe and the U.S. Thus, the company has set a goal of having 25 electrified models in 2023-two years ahead of its previous schedule. It said it expects sales of its electrified vehicles to double by 2021. The company is focusing on plug-in hybrids to achieve it.
BMW and Daimler, which are arch rivals in the luxury car market, are in the midst of a strategic partnership focused on highly-automated and autonomous driving. That is an area that is still developing and won't pay real dividends until after 2030, so the two companies are investing $1 billion in a new venture to develop services including ride-sharing and charging systems for electric cars. Companies are writing a new playbook for cooperating with rivals to lower costs without compromising competitive edge.
One of the drains on BMW's earnings is Trump tariffs on vehicles built in Spartanburg, South Carolina, and shipped to China. China has been a good export market for the German brand, but China has retaliatory tariffs on tariffs that Trump layered onto good going from China to the U.S.
Honda and Amazon are teaming up to offer consumers a level up in customer experience and convenience: the ability to receive their Amazon packages in their vehicles.
As of July 23, Honda started offering its U.S. customers the Key by Amazon In-Car Delivery service for subscribers of its HondaLink Remote Services connected-car system. It is unclear when the service will be offered to Canadians, but the move is a big step in the direction of modernizing the customer experience and meeting the needs of today's consumers.
"The addition of Key by Amazon In-Car Delivery to our HondaLink Remote Package of in-vehicle services comes at no additional cost to subscribers, (and is) yet another way we are creating new value for Honda customers," said Daniel Tiet, project leader, connected business development for American Honda Motor Co., Inc. "This latest addition to HondaLink provides a new service, heightening the Honda owner experience in this increasingly connected world."
Through the Key by Amazon app, owners of certain Honda vehicles with compatible HondaLink Remote Package and Amazon Prime membership can choose to have their packages delivered to their vehicles. The vehicles in question include the Accord, Accord Hybrid and Insight sedans, Passport and Pilot SUVs, and Odyssey minivan, depending on the trim and a HondaLink Remote Package subscription.
"Customers must also be Prime members and located in one of 50 cities and surrounding areas supported by the Key service," said Honda in its news release. "Members download the Key by Amazon app to their smartphone, log-in with their Amazon.com account information, and then select the year, make, and model of their Honda. The Key by Amazon app requests the user's HondaLink credentials, which enables Amazon delivery agents limited use of the remote features through HondaLink."
Customers can then shop on Amazon and select the "In-Car" delivery option at checkout. The day their package is due to arrive, the vehicle owner must park within two blocks of the delivery address they selected. They then have a four-hour delivery window and will receive an "Arriving Now" notification when the package is on its way to the vehicle.
Cars with advanced safety technology features encourage drivers to use cell phones more often while driving, according to report from insurance company State Farm.
Drivers of cars with lane-keeping assistance are twice as likely to video chat.
Half of all drivers keep their eyes off the road during the time it takes to travel 100 yards.
Here's a scary thought for those who take to the highway. As cars become safer, with new and more advanced features, drivers use them to engage in ever more risky behavior. One such activity: taking your eyes off the road for the "length of time it takes to travel a football field," or even longer.
A new survey by the nation's largest auto insurer, State Farm, entitled "Are We Driving Dumber in Smarter Cars?" found that drivers with cars equipped with adaptive cruise control or lane keeping assistance said they were almost twice as likely to use video chat while behind the wheel compared with those whose cars didn't have this advanced technology.
"These systems are meant to assist drivers, not replace them," warns State Farm Assistant Vice President Laurel Straub, who handles research for the insurer. "These innovations are designed to make our roadways safer."
But that's not always the way it's working. In fact, the percentage of inattentive drivers rises when it comes to other bad behaviors like engaging with cell phone apps, manually entering a phone number and holding the handset while talking. More than half of all drivers with high-tech cars admit to doing this. As for reading and sending text messages, the percentage of drivers with advanced safety tech who get away with it jumps to 62%.
State Farm also asked 1,023 registered drivers 18 and older who participated in the survey if they would take their eyes off the road "for less than five seconds." Half said they would. However, when driving 65 miles per hour, it only takes 3.2 seconds for your car to go the length of a football field. "Anything can happen in 100 yards," said Straub.
Unlike ordinary cruise control, adaptive cruise control not only sets your car's speed but automatically adjusts it to the speed of the vehicle in front of you to maintain a safe distance behind it. In most instances, lane keeping assistance enables a car to stay within its lane.
But they create a sense of "misplaced trust," said Straub. "The driver thinks the car can do more than it should."
Far less than fully automated
The Society of Automotive Engineers characterizes these safety features as Level 2, which is much lower than Level 5 that signifies full automation. "There will have to be more tech advances before we see fully automated vehicles on the highway," said Straub. "And it won't happen anytime soon."
But even a fully automated vehicle isn't safe all the time. Such was the case when an self-driving Uber SUV killed a pedestrian in Arizona in March 2018.
State Farm recommends that drivers:
Never enter destinations into a phone's GPS while driving
Put your phone in the glove compartment or a purse so you aren't tempted
Ask a passenger to make a call or send a text
Program your phone to automatically reply while driving
Coupes get a bad reputation for having rear seats that feel like afterthoughts. Sure, they have seat belts and adults can squeeze themselves in, but the back seats on most coupes are pretty much best suited for children or your bags. However, there are stylish coupes that can fit two adults in the back without discomfort. Here are 10 examples that range from affordable to extravagant.
The least expensive two-door in Mercedes-Benz's lineup has a flavor for everyone. From the well-rounded C300 to the 503-hp C63 S, the C-Class Coupe covers all of its grounds. If you're in search for rear-drive fun out of a Mercedes-AMG product, the C63 is one of your last choices because most AMG vehicles have transitioned to a performance-oriented all-wheel drive system.
The Dodge Challenger is one of the last remaining true muscle car on the market. It's also the only coupe currently available with a three-position rear seat, allowing it to accommodate five passengers. Need the most potent Challenger? The 797-hp Hellcat Redeye should rocket you and your friends in less than four seconds--provided you launch it properly and get it to grip.
As one of the last remaining affordable compact coupes on the market, the Honda Civic gives you plenty of style and generous seating for four (or five in a pinch) for not much money. It features cool full width LED taillights, and a short rear deck to give the car a swoopy side profile. Opt for the available 1.5-liter turbo-four for a nice balance of sportiness and efficiency. For those who want the most potent two-door Civic, the 205-hp Si gets you a sport-tuned suspension with adaptive dampers, a limited-slip differential, and optional summer performance tires.
Need a coupe with a nice shot of retro funkiness? Consider the Volkswagen Beetle, which offers room for four and plenty of character to go with it. It also comes standard with a 174-hp 2.0-liter turbo-four, giving it respectable power to get around. If you're looking to get one, you might want to head to your nearest Volkswagen dealer for a Final Edition Beetle because 2019 will be its last model year before it officially ends production.
Conservative but tasteful design defines the Audi A5 family even in its sleek coupe body style, which can hold four adults without issue. In addition to the standard A5, Audi offers two performance models, the S5 with its turbocharged V-6 and the fire-breathing RS 5, a 444-hp twin-turbocharged all-weather sports coupe to rival the BMW M4 and Lexus RC F.
Essentially a coupe version of the 3 Series sedan, the BMW 4 Series offers ample room for four and two potent engines to choose from. You'll also enjoy driving the 4 Series thanks to its excellent handling and strong acceleration. For those living in places that have four seasons, the 4 Series can be had with all-wheel drive.
The Mercedes-Benz E-Class Coupe blends cutting edge technology and luxury in a stylish package with seating for four. It retains its predecessor's pillar-free design, giving it plenty of greenhouse for you to see out of. For the first time, an AMG-badged variant joins the lineup in the form of the E53, which uses a mild hybrid 3.0-liter turbo I-6 good for 429 hp and 384 lb-ft. Check off the available active exhaust system for maximum aural pleasure via backfires and burbles.
For a truly Italian grand touring experience, the Maserati GranTurismo offers high levels of opulence and space for up to three friends to indulge in the car's well-appointed interior. Featuring a 454-hp, 4.7-liter V-8 built by Ferrari that comes with an intense soundtrack, the GranTurismo will sing a lovely song for you and your passengers as you devour the road ahead.
Not many coupes can rival the Mercedes-Benz S-Class Coupe when it comes to being able to do everything well. However, this massive two-door is at its best devouring long highways while you and your three passengers enjoy the comfortable, well-insulated interior. Should you need to get to places as quickly as possible, the 603-hp S63 and 621-hp S65 are the Autobahn cruise missiles for you.
If nothing but the most exquisite grand touring car will satisfy you, choose the Rolls-Royce Wraith. Essentially a plush four-seat coupe you can have custom-built to your exact specifications, the Wraith is the One Percent's personal luxury barge. It comes standard with a 624-hp, twin-turbo V-12 with 590 lb-ft of torque for effortless acceleration at any speed.