BMW China Battery Investment

BMW Makes HUGE Investment In China For Electric Vehicles – iX3 And Mini Electric

– $4.7 billion investment announced towards battery production with CATL

– BMW iX3 crossover to be built exclusively in China with BMW Brilliance Automotive

– Mini electric to be made in Oxford (UK) and China with Great Wall Motor

BMW have decided to make the iX3 and the Mini electric in China and made a massive investment towards the development and production of their future electric vehicles. The manufacturer has been sourcing batteries from Samsung but a new deal with China’s CATL might change that. CATL are China’s largest battery manufacturer and they’re also setting up a plant in Europe to cater to the European carmakers.

According to Electrek.co, The German automaker’s investment was earlier believed to have been $1.16 billion towards CATL’s cause. But, BMW have confirmed that the deal is worth $4.7 billion. This will help grow CATL’s production capacity, which currently stands at 17.5 GWh and will soon be at 24 GWh.

The iX3 was unveiled only a few months ago while the Mini electric concept was revealed almost a year ago in 2017. BMW’s joint venture in China, BMW Brilliance Automotive (BBA) will commence production of the iX3 crossover in 2020. The made-in-China Mini electric will come out of BMW’s 50:50 joint venture with Great Wall Motor. The two manufacturers haven’t revealed a timeline for production but the Mini electric will start rolling out of BMW’s Oxford plant next year. It is also backed by the Chinese and the German governments which shall enable BMW to build over half a million vehicles in China next year; and exclusive production rights for the BMW iX3 electric crossover SUV.

About the development, Harald Krüger, chairman, BMW board of management, said:

“Today’s signing represents a new chapter in the success story of our BMW Brilliance Automotive joint venture. Our agreement sets a long-term framework for our future in China – a future involving continued investment, further growth and a clear commitment to the development and production of electric vehicles. The next chapter of our cooperation has the potential to go beyond our existing motto – in China, for China. The all-electric BMW iX3, produced by BBA from 2020, will find customers around the world.

The strategic partnership (with Great Wall Motor) is a clear win-win, enabling us to contribute to China’s ambitious plans to ramp-up new energy vehicles and reduce emissions in the mobility sector,”

Chinese Automobile market has clearly gained great importance from the BMW Group among other automakers, as the company reportedly sold almost 560,000 vehicles there last year alone, making it the single largest market for the Bavarian Luxury carmaker. BMW already has a battery factory in China, hence full-scale electric vehicle production is a logical next step.

(The article is written by Mahesh Yadav. He is a car enthusiast and always look forward to new tech. He loves it when a great blend of the two shows up.)

Global Commercial Vehicle Market (2007-2017)

After 2007 sub-prime crisis, demand for CV plunged and de-growth continued till 2009. During tough financial times several Governments had put monetary and fiscal stimulus in place (Keynesian Economic Theory) and market demand regained, and by 2011 it was again back to 2007 level. 2011 onwards global demand had gained traction and is growing at steady pace now.

The USA is by far the biggest CV market. Global CV growth is always in line with the US market growth trajectory, thanks to American’s love for pick-up (Light commercial vehicles).

However, global growth hasn’t been homogenous, as several countries have gone through strained financial condition in last 10 years, coupled with tepid demand owing to inherent cyclical nature of CV industry. India too is case in point, by 2011 India reached #4 rank but then slipped to #6, followed by shallow recovery.

Top 30 Country-Market of 2017

Data Source : OICA CV sales data (Commercial vehicles include light commercial vehicles, heavy trucks, coaches and buses)
  • The USA has lion’s share in the global market
  • Top 30 countries account for 95% of global CV sales
  • Out of top 30 countries, almost 11 have witnessed ‘0’ or negative growth in last 10 years due to stagnation or declining economic activities in respective countries

High Growth Region (2007-2017)

  • These are the countries having substantial base year market size and sustained growth rate of 5% and above over a decade
  • These are the key markets and CV OEM need to watch out these countries as their future growth engine
  • Economic recovery in Brazil & Russia, which suffered economic recession in recent past, now have high chances of better growth in coming years as oil and commodity prices have started hardening

Declining Major Markets (2007-2017)

  • Crude Oil price crash of 2015 was a major setback for Russia and Saudi Arabia and the reason for declining CV market
  • Spanish and Italian market witnessed massive decline at the height of European Sovereign Debt crisis around the year 2012, since then both are on recovery path
  • In last 4 years Japanese market growth rate has been almost flat, it is more like a saturated market now

Continent

  • Canada and the USA are growing at healthy rate in line with their economic growth trajectory
  • After 2010, Asian market growth has remained largely flat
  • Overall European market has contracted in last decade

North America

Africa

Central & South America

Asia

Europe

‘Move Dealers’ Focus From Customs to Customers’ – MD Volvo India

A couple of months ago, Volvo India had inaugurated its first warehouse in India. Located in the outskirts of Mumbai, this new step allows Volvo to prepare for an assault as the company hopes to double its market share in India by 2020. Generally, volumes are inversely proportional to the cost of the car and the launch of the all-new XC40 crossover will help Volvo post some healthy numbers this quarter.

Once that happens, more and more owners of Volvo cars will come to expect a turnaround time for repairs that is comparable to the ‘big three’. The new warehouse will help in that regard. It must be noted that the German carmakers have been around assembling cars in India for much longer while Volvo only commenced operations in October 2017. But, they’re marching forward with a noticeable aggression.

Benefits for Volvo dealers:

– Zero investment required towards maintaining inventory of slow-moving parts
– No paperwork and dealing with customs
– Easier to satisfy customers with quicker turnaround times
– Overnight shipping from Volvo’s Bhiwandi warehouse

Benefit for Volvo car owners:

– Dramatically shorter timeframe for repairs

While speaking with AutoPunditz, Charles Frump, MD Volvo Cars India, said:

“It has a big impact on our dealers. They’ve done a great job of maintaining a good inventory of parts so far.

Instead of investing a lot of capital and energy into maintaining an inventory, the dealers can expect a better profitability, maybe they can advertise more. Or have the same employees who used to handle the customs paperwork to work with the customers and help them.

If it’s a fast moving part then the dealer will obviously have adequate stock to serve the clients. Everything else they can have it shipped overnight from our new warehouse. This doesn’t sound as exciting as the launch of a new car but it helps the dealers and our customers at the same time. The dealers are definitely very excited about this.”

(The article is written by Mahesh Yadav. He is a car enthusiast and always look forward to new tech. He loves it when a great blend of the two shows up.)

The Swedish Attack! – Volvo Cars registers YoY 33% growth

Volvo Cars finishes H1 with record sales, registers a robust 33% growth

Volvo Cars announced a record 33% growth in volumes in Jan-June 2018 versus last year. The robust sales performance of 1242 units is spearheaded by the XC60 which contributed 25% of the total volume. Successful addition of S90 to local assembly, aggressive network expansion and exemplary brand engagement programs led to the best ever H1 sales performance for the company. The rest of the year looks even brighter with the launch of XC40.

Charles Frump – Managing Director, Volvo Car India shared, “We are extremely happy with our growth pace and intend to keep up the momentum for the rest of 2018. The recently launched XC40 is our first offering in the entry level SUV segment and we expect the XC40 to build a new customer base for us and drive sales.”

The design language of Volvo has evolved enormously and has helped the Luxury Car maker gain higher acceptance amongst its buyers. Internationally renowned for its safety, the cars are now one of the best looking vehicles as well in their respective segment. With the way the OEM has expanded (both in network and lineup of cars); it seems the Swedish Auto major is here to dominate.

Volvo XC40 Luxury Crossover Launched in India!

The introductory price of the Volvo XC40 is Rs 39.9 lakh ex-showroom for the fully-loaded R-Design variant with a diesel engine. According to the senior officials, this pricing is not sustainable so a revision is expected soon. The timeframe for the price hike is not decided yet and neither is the final price tag that’ll make this crossover profitable for the company.
Impossibly Affordable
For now, Volvo appear to have put their margins on the line as there’s no way the XC40 can undercut its locally-assembled rivals while being a CBU import. Local assembly will help cut those losses while a price revision will make it profitable. But, all that will depend on the volumes this crossover can bring in. Volvo may even speed up to get the local assembly commenced if the demand justifies. The local assembly of the XC60 will begin this quarter and, given the strong demand for SUVs and crossovers, we believe the XC40 won’t stay on the CBU path for long.
The compact luxury SUV segment is said to be the most lucrative of all churning out ~6,000 units per year in India. That’s a big pie and even a small slice of that will result in a sizable growth for the Swedish carmaker.
Flexible Frame Can Take A Variety Of Powertrains
The newest Volvo stands on the brand new Compact Modular Architecture platform — CMA for short. Just like the bigger SUVs’ SPA platform, this one is capable of accommodating a petrol engine, a diesel engine, or a petrol-hybrid engine with front-wheel drive as well as all-wheel drive. This will allow them to rapidly deploy hybrids should the need and/or demand arise.
New Parts Warehouse
Along with their most affordable luxury crossover, Volvo also announced that they now have a warehouse for spares in India. This will result in faster turnaround times for customers. At the same time, it benefits the dealers as they no longer have to worry about:
1. locking up their capital
2. holding the spares onsite
3. dealing with the customs and paperwork
New Dealerships This Year
By the end of this year, Volvo will have 5 more outlets, thus helping them expand their reach and add more customers to the Volvo family. The manufacturer has witnessed steady growth, both, in India and worldwide, since the redesigned models started hitting the showrooms. The trend is expected to continue as XC40 makes the brand even more accessible for buyers looking to stand out. The manufacturer delivered 5,71,577 units worldwide in 2017. With 3,17,639 models already moved this year, it looks like a target of 6.5 lakh units for 2018 is very much within reach.
Here’s a gist of XC40’s notable features:
– Biggest footprint in its class
– Boxy proportions for a rugged SUV look
– Best-in-class power and torque (190hp/400Nm)
– All-wheel drive is standard (Sourced from Haldex)
– Only diesel engine for now
– 8-speed automatic (Sourced from Aisin)
– Radar-based safety features
– Traffic sign recognition and warning if you exceed the speed limit
– Automatic full emergency braking
– Large animal detection
– Adaptive cruise control (maintains a safe distance from the vehicle in front and moves automatically; no acceleration of braking input required
– City traffic assist (Automatically manages the acceleration and braking at low speeds)
– Lane keep assist
– Semi-autonomous driving (On well-marked and open stretches of road, the XC40 can drive for short durations without requiring any driver inputs, not even for steering)
– Panoramic sunroof
(The article was contributed by our fellow pundit Mr. Mahesh Yadav)

Sales of Hatches, MUVs & Cross in June’18

Hatches win matches! – Yes, this rule holds true in the Indian Automotive space for the OEMs. Maruti has been successful with this strategy since day 1 and is still holding it’s fort. Even Hyundai has grown to this proportions with the success of its erstwhile Santro (which is planned to be relaunched), i10/Grand. Renault’s baby Kwid did big wonders to the company and even Tiago has elevated Tata to the No.3 Spot in the Top OEMs!

Let’s see how the hatches fared in June’18 –

Best selling hatches of June’18
  • Swift overtook Alto sales by over 100 units and was also the second best selling car of June’18
  • Grand i10 has now become the third best selling Hyundai and sells lesser than Creta/i20!!!
  • Tiago’s YoY growth was an impressive 53% and it’s evident that the hatch is more accepted than its rivals Celerio/Kwid.

Premium Hatchback Sales in June’18 –

  • Baleno with a YoY growth of 97% is the undoubted champion in the segment
  • i20 stands the test of time and still easily sells >10k units per month
  • Polo has now become an enthusiasts car and the numbers are limited accordingly
  • Jazz facelift is expected to be launched in July’17. Can it work wonders similar to the New Amaze?

Cross-Hatch sales in June’18 –

  • It is now a virtually dying segment and the volumes are consistently sloping down. However, Ford has made a bold move with Freestyle and what works for Freestyle is the ‘pricing’. Hope it continues to do more than 2.5k units average/month to sustain itself.

MUV sales in June’18 –

  • The most expensive offering in the segment is also the Best selling car in the segment! It is seldom this kind of scenario is seen in any category. However, only Toyota has the mettle to do so!
  • New Ertiga launch is on the cards and shall improve the sales even further for the marque.
  • Hexa sales is well below 1000 nos and is not as expected by the brand.

SUV Sales for June 2018

SUVs have been a craze in the Indian Passenger Vehicle space and almost all OEMs have an offering in the segment. To highlight the significance of the SUV segment – Kia & MG are planning to launch their first product on the Indian soil which shall be a SUV! Also though the overall Passenger cars sales grew by 37% in June’18; the SUV sales were up by an hefty 63!

As usual, value matters the most in the segment – Ex: Creta sold more than the much cheaper & smaller Brezza; similarly Fortuner & Endeavor sold more than the cheaper Captur! No wonder the Creta sibling shall be launched by Kia as Tusker (SP Concept) as their first model in the portfolio.

Let’s see the Top sellers in the Compact SUV & SUV space –

Best selling Compact SUVs
  • Brezza stands unbeatable in the segment and has made Maruti as a formidable player in the SUV space
  • Nexon overtook Ecosport & WRV to become the second best selling car in the Compact SUV segment
  • Even with TUV Plus, the overall sales for the marque was only 1811 units
Best Selling SUVs
  • The New Creta is now consistently on the Top 2 selling cars in the Hyundai’s portfolio!
  • S-Cross sales has jumped pretty significantly post the facelift and has now settled between 4-4.5k units
  • Compass sells more than the Duster – another example of how the consumers perceive value!
  • Tiguan sales have shot up – No specific reason on how it’s happened.

Sedan Sales for June 2018

Sedans have got sudden attention in the recent time  and a lot of promising launches happened in the past 2 months (from the Japs – Honda & Toyota). The 3-box car was an erstwhile favorite for the Indian consumers, but the SUV onslaught had slowed down its pace. However, the OEMs have not given up yet on the segment and the consumers are responding positively too for the new models. Let’s see how the models fared in the Compact Sedan & Sedan category –

Top selling Compact Sedans for June 2018
  • The No.1 selling car in India comes from this segment. The Desirability of Maruti’s Dzire is now unparalleled and the car registered a sales of impressive ~25k units in June!
  • Honda’s earnest effort has found good numbers of takers in the Indian Market and the Amaze has taken everyone by surprise with the volume garnered in the first 2 months of its launch. It registered an offtake of >9.1k units and it alone contributed to ~52% of Honda Cars sales in India for June’18!
  • Other models fared average and it clearly shows that the competition now shall be between Dzire v/s Amaze.

 

Top selling Sedans of June 2018
  • It is a roller-coaster ride for the models in this segment as the competition is the most fierce here. No one model has emerged as a clear winner in this category in 2018 & with Yaris the game has gone even tougher.
  • However, Verna emerged as the No.1 seller in the segment and it did close to ~4k units. It was just 19 units more than the next-best selling City.
  • Yaris is now showing initial signs of struggle and the sales have already dropped to <2k mark. Toyota needs to act fast to capitalize on the initial launch fanfare.
  • Ciaz sales sloped down to 1579 units in June’18 – It was particularly due to the upcoming Ciaz facelift. Nexa Ciaz is now gearing up to become a more formidable offering in the category.