Skoda plans to build a new plant in Europe
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Skoda plans to build a new plant in Europe
- Skoda (the Czech subsidiary of the Volkswagen Group) plans to increase its production capacity in Europe, as the production volume in recent years is gradually approaching the saturation level of the current plants in the Czech Republic. In addition, the launch of the new Kodiaq SUV (D segment), Karoq (C segment) and ??? (B segment) should logically increase Skoda’s sales and therefore increase production.
- There are several possibilities for Skoda: either increase production capacity at its two existing plants in Europe (MladaBoleslav and Kvasiny), or build a new plant in Europe, probably outside the Czech Republic.
- The first solution seems to be compromised since the unions have so far refused the introduction of additional teams in the two Czech factories, which would have produced an additional 100,000 vehicles per year.
- Another solution had been studied, that of making the Superb model in the German Emden plant (where the VW Passat is produced), but the introduction of the VW Arteon in this plant put an end to this option.
- Therefore the only possible solution now is the construction of a new factory in Europe. Due to the scarcity of manpower available in the Czech Republic and Slovakia (given the number of factories present), Skoda could direct its choice towards Poland or Hungary, or even Bulgaria or Romania.
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GM, Ford, Chrysler market share remains at its lowest in US market
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GM, Ford, Chrysler market share remains at its lowest in US market
- GM, Ford and Chrysler's market share remains at its lowest level in 2017, standing at 44.4%, virtually the same as the lowest level in 2009 (44.2%), at the most difficult moment of the financial crisis.
- Yet the market share of the three major US manufacturers exceeded 80% in the 70s, before falling to 70% in the 80/90s. This share remained practically stable until 1999, when the Japanese manufacturers started production on American soil under Reagan's presidency, between 1983 and 1990. At the same time, we can see on the bottom right graph that the GM group has suffered much more than Ford or Chrysler in those years. Indeed, GM lost 15 market points between 1980 and 1999, while Ford gained 5 and Chrysler 7, hence the marginalization of brands Oldsmobile, Pontiac and Buick that have been discussed last month.
- The market share of GM, Ford and Chrysler declined again between 2000 and 2005, from 70% to 60% of US registrations, then to 52% in 2007 and finally 44% in 2009. Since that date, this market share stagnates between 44% and 47%, and is at 44.4% in 2017. In the light of announcements from US manufacturers regarding their gradual withdrawal from the sedan segment, it is highly likely that their market share will fall to 40% over the next four or five years, and this, despite the desire of President Trump to revive the activity of American manufacturers.
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What strategy for the Fiat-Chrysler Group?
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What strategy for the Fiat-Chrysler Group?
- The discontinuation of the Fiat Punto, and the concentration of Fiat production on the 500 and the Panda, adds to other decisions of the FCA group which resulted in the discontinuation of the Chrysler 200, Dodge Dart and Dodge Viper. The production of the Dodge Caravan, which stopped in August 2017 to shift volumes to the Chrysler Pacifica, resumed abruptly in December 2017 to meet customer demand. The discontinuation of the LanciaYpsilon, and of the Lancia brand overall has been confirmed. The sales ambitions of Alfa-Romeo and Maserati have been dashed. The shutdown of Fiat's production in China and India, two of the largest potential markets, completes the picture.
- In 2017, the FCA Group moved from seventh to eighth worldwide, behind Honda. The group's various attempts to associate with other OEMs have all failed. As a result of these failed attempts, the FCA Group can not develop the most modern technologies, such as modular platforms, hybrid and electric engines or the hyper-connected and autonomous car alone, while at the same time the FCA group has decided to stop the production of diesel cars by 2022. Only LCV will continue to be equipped with this type of engine.
- The situation of the FCA group seems very fragile today, especially since its strategy shows little initiative or offensive. Perhaps the new leadership that will take office in 2019 will adopt a different strategy.
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The new brand organization at GM, Ford and Chrysler
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The new brand organization at GM, Ford and Chrysler
- With the Buick brand disappearing from the North American market this year, the structure of the former Big Three, GM, Ford and Chrysler, has a whole new look.
- Indeed, each of the three manufacturers has only one general brand (Chevrolet for the first, Ford for the second and Dodge for the third) and a luxury brand (Cadillac for the first, Lincoln for the second and Chrysler for the third). Intermediate brands like Oldsmobile, Pontiac, Mercury and most recently Buick have all disappeared.
- This brand structure is reminiscent of Japanese manufacturers based in North America, such as Toyota (Toyota, Lexus), Nissan (Nissan, Infiniti) and Honda (Honda, Acura).
- There are also the light trucks brands (GMC for GM, Jeep for Chrysler) which are still very much alive. Ram is actually the LCV of the Dodge brand, although recently the FCA group has been considering it a separate brand.
- General brands Chevrolet, Ford and Dodge are not directly threatened, especially thanks to the presence in their range of large pickups Silverado (Chevrolet), Series F (Ford) and Ram (Dodge) which have the highest registrations in the US. The situation is more difficult for the luxury brands, Cadillac, Lincoln and Chrysler, which have been marginalized by the German (Audi, BMW, Mercedes) and Japanese (Lexus, Infiniti, Acura) Premium brands.
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The VW New Beetle will not be replaced
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The VW New Beetle will not be replaced
- The Volkswagen Group confirmed at the 2018 Geneva Motor Show that the New Beetle will not be replaced. Sales of this model, launched in 1998 and updated in 2011, did not meet VW objectives of 150,000 units per year, of which 100,000 in Europe.
- Indeed, the New Beetle sold only 60,000 units in 2017, compared to 90,000 in 2014 and 110,000 in 2013. The first generation launched in 1998 and marketed until 2011 sold 1,165,000 units in 13 years, or 90,000 units a year. The second generation launched in 2011 sold 522,000 units as of the end of 2017, and Inovev estimates that sales of this model will reach 150,000 units between 2018 and 2022, when the model is likely to be discontinued. This second generation will therefore have sold 672,000 units over its 11-year life cycle, or 60,000 units per year.
- The results achieved by both generations of the Volkswagen New Beetle are therefore far removed from VW’s 150,000 /year objectives. In Europe, sales of the first generation of the New Beetle have never exceeded 45,000 /year, and that of the second generation 35,000 / year. The New Beetle may have suffered from the ”internal” competition of the VW Golf which has a better set of features and benefits than the New Beetle, which has been condemned to being a niche vehicle.
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