Good morning! It’s Friday, February 16, 2024, 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: Ford Finally Fixes Form
In recent years, Ford has had a nightmare when it comes to build quality and reliability. The American automaker has faced countless recalls relating to faulty windshields, battery issues and mechanical problems, leading it to top the list of automakers with the most recalls not one, not two but three years running.
Now, however, Ford boss Jim Farley says the Blue Oval is finally getting on top of the issues. According to a report from Automotive News, the American automaker is getting to work tackling various “inefficiencies” in its production and “dysfunctionality within Ford.” Automotive News reports:
One way Ford is working to fix quality issues, Farley said, is by tying employee bonuses to improved scores. When he became CEO, he noticed a vast majority of managers received full bonuses even after the company led the industry in recalls — a U.S. record Ford has held now for three consecutive years. He quickly changed that.
“You have to set up a culture shift — a performance reward system where every engineering manager, purchasing component manager and plant manager is fully accountable for the quality and cost of their work,” he said.
Now, the company CEO says there has been “real progress” in terms of turning around quality at Ford. In fact, he claims there’s been a 10 percent increase in quality at Ford, however that’s measured, after bonuses for bosses were more closely tied to performance.
However, Ford is still awash with recalls, with its latest coming just last month when more than 100,000 Focus models and cars fitted with EcoBoost engines were called in for repairs. The massive recall was not a good start to this new and improved year.
2nd Gear: U.S. Spends Millions On Other Peoples EVs
There’s no two ways about it, electric vehicles are pretty expensive in America right now. Thankfully, there’s a payout from the government to alleviate some of the costs of EV ownership, but it’s costing the taxpayer an awful lot of money.
Now, a report from Reuters has revealed just how much the U.S. has spent on other people’s EVs, and it’s enough to buy more than 4,500 brand new Nissan Leafs. As Reuters explains:
The Internal Revenue Service has received more than 25,000 time of sale reports, including more than 19,500 – or 78% – with advance payment requests and approximately $135 million has been paid to dealers since Jan. 1, Treasury said in disclosing the previously unreported figures.
“One month into implementation of this provision, there is strong demand for this new upfront discount, which will continue momentum in growing this industry in the United States,” Deputy Treasury Secretary Wally Adeyemo said in a statement.
For 2024, the U.S. government changed the way it would pay out EV tax credits, with buyers of qualifying vehicles able to transfer the credit directly to their dealer. This new process effectively lowers the purchasing price of the EV, rather than forcing buyers to claim the credit back once the new car was on their driveway.
3rd Gear: Mercedes Is Going For Volume, Again
Remember two years ago when Mercedes killed off the A Class in America and said it was targeting luxury clients stateside? Well, it’s backtracked on that and says it’s now going to focus its attention back on volume and value here in the land of the free.
This story comes from Automotive News, which reports that Mercedes is backtracking on its post-pandemic pivot to luxury and high-priced EVs. Now, the site reports that the German automaker will change tact this year to focus on lower-priced models that can help it hit sales of 300,000 units in the U.S. Automotive News reports:
At a dealer meeting in Las Vegas this month, Mercedes said more affordable bread-and-butter models will drive sales in 2024, partly because of the product cycle, sources at the event told Automotive News.
The automaker will deliver 25 new and updated models to showrooms this year, including entry and mid-segment models such as the redesigned E-Class, a new CLE coupe and convertible, and a GLC plug-in hybrid crossover.
According to the site, the pivot will also see Mercedes-Benz move away from its push to popularize EVs, and instead the automaker will introduce more gas-powered and hybrid models. The new strategy, Mercedes hopes, will deliver “double-digit percentage” sales growth in the U.S. over the course of 2024.
4th Gear: Russia Starts Building Citroёns At Abandoned Plant
When Russia launched its invasion of Ukraine in 2022, automakers around the world pulled production and sales from the country almost immediately. Now, in an effort to maintain a supply of new cars to people across the country, Russian officials are taking over abandoned factories to start up production once again.
According to a report from Reuters, Russian manufacturers are partnering with Chinese automakers to begin building Citroёn cars at a plant that was shuttered by Stellantis following Russia’s invasion of Ukraine. As Reuters explains:
In December last year, Russian company Automotive Technologies imported at least 42 car kits for assembling the Citroёn C5 Aircross model at the Kaluga plant, which is still majority-owned by Stellantis, customs records drawn from a commercial trade data provider showed.
It is not clear if the kits from China contained parts that fall under the scope of Western sanctions on Russia, to which Beijing is not a party, and there is no suggestion from the customs data or sources that Stellantis knew about the imports.
As well as highlighting Russia’s dependence on China after it was shut off from western Europe, the findings show the lack of control global brands have over their products in Russia. In fact, Stellantis even told Reuters that it had “lost control of its entities in Russia.”