Ford supplier costs, Tesla Optimus robot, S. Korean President visits Biden

Inside Automotive:

Bloomberg’s Kevin Tynan reviews new car supply data, affordability issues, and inflation
Inventory and pricing data from August is in, and once again, on Inside Automotive, we’re joined by Kevin Tynan, Bloomberg Intelligence‘s Senior Automotive Analyst, to give us an update on the market. Inventory has “kicked up,” Tynan says. Automakers see what’s happening at retail with their pricing, and as much as an extra million could enter the fray. Consumers could face the “pay sticker” situation, and processes improve by ordering online. The increase in inventory, however, is still a fraction of what it was in 2019. Tynan says that manufacturers are trying to find the “sweet spot” with pricing. Watch the complete segment here.

Headlines:

South Korean President Yoon Suk-Yeol is set to make his first official visit to the United States this week to meet with the UN General assembly and President Joe Biden in New York. On the list of topics is South Korea’s opposition to the newly passed Inflation Reduction Act and US subsidies for EVs. The new law eliminates federal tax credits for EVs made outside North America, making companies like Hyundai and Kia no longer eligible for subsidies. Government officials in Seoul have complained about the law, labeling it a betrayal of Biden’s vow to boost bilateral economic ties. In light of this development, Kia recently announced plans to start producing EVs in the US in 2024. Read More

Ford Motor Company announced this week that supplier costs could be $1 billion higher in the third quarter than expected due to inflation and supply chain issues. The company said supply shortages have resulted in a backlog of thousands of assembled yet incomplete vehicles, most of which are high-margin trucks and SUVs. Ford shares fell 5.49% in after-hours trading after the announcement. Other automakers are facing similar issues. In August, Rivian said it expects to lose $5.45 billion due to supply chain issues, and GM reported a second-quarter net income of $1.69 billion, 40% less than the previous year. Despite the rise in supplier costs, Ford is keeping its projected 2022 adjusted earnings at between $11.5 and $12.5 billion. Read More

Tesla CEO Elon Musk has said the company’s Optimus humanoid robot project, or Tesla bot, has become a top priority and requires reallocating Tesla’s autopilot team to work on the robot. The news is leaving many concerned that the company is spreading itself too thin, especially considering Tesla is selling autopilot and full self-driving packages before they’re ready. Some impatient customers are filing lawsuits against the EV maker for not delivering on its self-driving promises. The company is expected to unveil its first working prototype of the robot at Tesla AI Day 2. The company will also showcase an updated version of its “Smart Summon” and autopark features at the event. Read More

Subaru and Lexus topped the 2022 Automotive Reputation Report, which measures customer feedback to help businesses improve their customer experiences. The report analyzed around 20,000 dealerships, 33 brands, and 5 million customer reviews to come up with the rankings. According to the report, Subaru has the best reputation among US mass-market auto brands, and Lexus took the top spot for luxury brands. Both brands moved up from second place positions last year, overtaking Nissan and Infiniti. The report also awarded AutoNation and Hendrick Automotive Group with top spots in their respective rankings. Read More

News & Opinion

AutoNation, Hendrick Automotive Group score top marks in Reputation report
The 2022 Automotive Reputation Report results are in, and Subaru and Lexus top the list for brands with the best reputations. Subaru came first for non-luxury brands, and Lexus was top of the list for luxury brands. Meanwhile, AutoNation came in number one in the Public Dealer Group category, and Hendrick Automotive Group got top honors for best privately owned dealership group. The report is compiled by Reputation, a company that uses customer feedback to help businesses improve customer experience and satisfaction. Dave Mingle, Reputation’s Global Head of Customer Experience, said input is essential no matter where it comes from. Read More

Auto dealers have room for improvement when it comes to the tire market
J.D. Power’s 2022 US Original Equipment Tire Customer Satisfaction Study highlights the experience of car owners with tires that their vehicle was equipped with from the factory. The study also analyzes trends in tire replacement and the effect tires have on loyalty. This year, the tire study identified that while a great number of car owners expressed satisfaction with their vehicle’s OEM tires, only a small segment considered expert insight when purchasing their next set of tires. Read More

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