Elon Musk wants to buy Twitter, Toyota wants to make a Crown SUV, and Volkswagen. All that and more in The Morning Shift for April 14, 2022.
1st Gear: Crown
The Toyota Crown is in its fifteenth generation, having been manufactured since 1955 in one form or another, the car of Japanese government officials, a shining diamond in the Toyota stable, a sedan that even Mercedes and BMW might be jealous of. So why not cash in all of that history and make an SUV Crown? It sounds like that is exactly what Toyota is planning.
The SUV – which will come in hybrid, plug-in hybrid and full-electric models – marks an attempt to bring the 67-year-old Crown more in line with market trends as consumers shy away from sedans, the people said, declining to be identified because the information has not been made public.
Sales of the hybrid are expected from the summer of 2023 and will include exports to China and North America, while the plug-in hybrid is intended for the domestic market, they said.
The electric model is due to launch in early 2024 and the automaker has yet to finalise export plans, two of the people said.
As part of the overhaul, Toyota will also roll out a fully remodelled sedan version of the Crown from this summer, the people said.
Both the SUV and the sedan will be manufactured at factories in Toyota City, Japan.
The Crown was sold in the U.S. until the mid ‘70s, and then we got the Corona Mark II, and then we got the Cressida, and then Lexus confused everything and we ended up with the Avalon. It seems perfectly fitting that when we get the Crown again it will be a big dumb SUV. I hate it.
2nd Gear: Elon Musk Wants To Buy Twitter
Tesla CEO and Twitter user Elon Musk offered to buy Twitter on Wednesday, news of which broke Thursday, in a deal that is worth around $43 billion. Just last week, news emerged that Elon had bought a substantial stake in Twitter.
The filing with the Securities and Exchange Commission is slightly unusual, though amusing in its casualness. For example, in these messages apparently sent to Bret Taylor, the chair of Twitter’s board:
[SEND VIA TEXT]
As I indicated this weekend, I believe that the company should be private to go through the changes that need to be made.
After the past several days of thinking this over, I have decided I want to acquire the company and take it private.
I am going to send you an offer letter tonight, it will be public in the morning.
Are you available to chat?
1.Best and Final:
a.I am not playing the back-and-forth game.
b.I have moved straight to the end.
c.It’s a high price and your shareholders will love it.
d.If the deal doesn’t work, given that I don’t have confidence in management nor do I believe I can drive the necessary change in the public market, I would need to reconsider my position as a shareholder.
i.This is not a threat, it’s simply not a good investment without the changes that need to be made.
ii.And those changes won’t happen without taking the company private.
2.My advisors and my team are available after you get the letter to answer any questions
a.There will be more detail in our public filings. After you receive the letter and review the public filings, your team can call my family office with any questions.
“Have your people call my people” is a classic for sure. I hope the sale goes through and then it finally kills Twitter for good. Some have used — what else, Twitter — to suggest that this is some kind of pump-and-dump scheme, but I don’t think Elon is thinking that far ahead. This is purely rich guy goes to a playground, quite enjoys it, decides he also wants to buy it.
3rd Gear: Volkswagen Made Another Fat Profit Though It Said That Russia’s Invasion Of Ukraine Is Complicating Things
Volkswagen announced its first quarter profits on Thursday, and it did quite well for itself, as expected. The earnings announcement did not come without fretting over what the conflict in Ukraine would mean for VW’s business, of course.
Volkswagen on Thursday warned that it had started to feel the impact of the war in Ukraine on supply chains and raw materials prices in the first quarter, with the longer-term effects on its business difficult to predict.
The company indicated an 8.5 billion euro ($9.27 billion)operating profit for the first three months of the year, but noted that 3.5 billion euros of that was attributable to commodity hedges amid soaring raw material prices.
Volkswagen shares were 2.1% lower at 147.9 euros by 1054 GMT.
Its operating return on sales jumped to 13.5% in the first quarter, according to the preliminary figures, from 7.7% in the same period of 2021 when the COVID-19 pandemic and semiconductor shortages were weighing heavily on results.
Volkswagen will continue to do just fine until further notice.
4th Gear: A Self-Driving Car Startup Has Very Modest Plans For South Carolina
Argo AI, which is mostly owned by Ford and Volkswagen, plans to spend all of $2.6 million developing some kind of test facility in South Carolina, according to the Associated Press. The investment might create 40 new jobs.
A closed-course track will be built in the South Carolina Technology and Aviation Center for development and testing of self-driving vehicle technology. Argo AI has other closed-course facilities in western Pennsylvania and Munich, Germany.
This one will focus on highway-speed testing as the company works toward commercial autonomous operations across multiple cities, according to the release.
“Argo AI’s new operation in Greenville County further proves what so many already know — South Carolina is a top destination for companies in the automotive industry,” Gov. Henry McMaster said.
Congratulations to all involved.
5th Gear: Panasonic Might Be Trying To Wean Itself Off Tesla
The battery maker wants to build more batteries and diversify, according to the Financial Times, probably also because Tesla has plans to make its own batteries and maybe wean itself off of Panasonic. The two, however, seem inextricably intertwined.
Yuki Kusumi, a company veteran appointed chief executive last year, told the Financial Times in an interview that the company would invest ¥600bn ($4.8bn) in new growth areas over the next three years. Two-thirds of the spending will focus on EV batteries, supply chain software and air conditioners and the remainder has been earmarked to develop other new technologies, including hydrogen energy.
Kusumi said Panasonic would prioritise developing the lithium-ion 4680 battery, which has five times more energy capacity than current devices, at its Wakayama factory in western Japan.
Elon Musk, Tesla’s chief executive, has said the 4680, which is not scheduled for mass production until next year, will help bring down the price of a Tesla car to about $25,000. Tesla’s Model 3 starts at about $41,000.
For Panasonic, the battery represents an opportunity to diversify its client base from Tesla. “If the 4680 is second to none in terms of performance and cost, manufacturers other than Tesla will eventually adopt it,” said Kusumi.
He added that the investment pledge for EV batteries and other growth areas would “probably not be enough” to meet worldwide demand.
I would say that battery supply is the next real battleground for automakers, except that that battle has been already happening for a while.
Six days after being assigned for the first time to the western front, two American pilots from the U.S. First Aero Squadron engage in America’s first aerial dogfight with enemy aircraft. In a battle fought almost directly over the Allied Squadron Aerodome at Toul, France, U.S. fliers Douglas Campbell and Alan Winslow succeeded in shooting down two German two-seaters. By the end of May, Campbell had shot down five enemy aircraft, making him the first American to qualify as a “flying ace” in World War I.
Neutral: How Are You?
I went to the New York International Auto Show yesterday for the first time after spending a lifetime successfully avoiding it. The lack of buzz about anything in the building was fairly striking. Well, anything except the GR Corolla and F-150 Lightning. I suppose the ID Buzz, too. There is also a stand there from an EV startup called Indi, which no one has ever heard of.