Welcome to a new week, did you have a good weekend? It’s Monday, August 14, 2023, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are all the important stories you need to know today.
1st Gear: Tesla Still Has Room For Price Cuts
Electric vehicles are expensive, there’s no getting around that fact. As it stands, the cheapest gas-powered car you can buy in America is the Nissan Versa, which can be yours for around $16,000, while the cheapest EV is more than $10,000 more expensive. But to try and draw in new buyers, electric car builders have been slashing prices left, right and center over the past year.
This all started in 2022, when Tesla announced massive cuts to the cost of some of its most popular models. This was then followed by price cuts from Ford on its electric models, as well as EV startup Lucid. Now, Tesla has slashed the price of its cars even further, but only in China. As Reuters reports:
Tesla Inc has cut prices in China for its Model Y long-range and performance versions starting on Aug. 14, the company said in a notice on Monday.
The car company dropped the starting prices of both models by 14,000 yuan ($1,934.58). The Model Y Long Range’s starting price drops 4.5% to 299,900 yuan ($41,294) and the starting price of the Model Y Performance is now 349,900 yuan ($48179), down 3.8%.
The new starting prices in China are considerably lower than the Model Y’s starting price in the U.S. Here, the Long Range car starts at $50,490, while the Performance model is $54,490. Of course, both cars are then eligible for tax breaks of up to $7,500 on top of that initial purchase price, which does make them more competitive.
But for now, the latest price cuts appear to be exclusive to China, where Tesla is facing stiff competition from native automakers like BYD and NIO. Maybe, in order for the company to address its sky-high prices in the U.S., it needs a more compelling rival on home soil.
2nd Gear: Stellantis Is Blaming The UAW On Its Expensive EVs
And talking of affordable EVs, Stellantis has taken the rather strange decision to blame the high price of its electric cars on unionized workers. The Jeep, Fiat and Dodge owner told Automotive News that the prospect of a sub-$25,000 EV is at odds with the higher wages and benefits that the United Auto Workers union is currently bargaining for.
Right now, Stellantis and fellow big three companies Ford and GM are stuck at the bargaining table with the UAW, which is fighting for fair working conditions for employees at auto plants across America. The union laid out its demands last week, which included pay rises across the board and a switch to a four-day working week. But Stellantis has hit back against some of these demands, arguing that it’s at odds with its own ambitions to start selling affordable EVs. As Automotive News reports:
Reaching that price range, [Stellantis CEO Carlos] Tavares said last month, will be crucial to protecting jobs in the long run. Tavares has said in the past that Stellantis would need to absorb the additional costs that come with building EVs and not pass them onto consumers.
The company’s imperative to reduce its fixed-cost structure in pursuit of more affordable EVs is clashing with the UAW’s demands for higher wages and benefits at the bargaining table.
“We need to work very hard to reach that point,” Tavares said of a $25,000 EV for the U.S. market. “Part of the things we need to discuss with our union partners is how we make affordable EVs in the U.S. that the middle classes can buy and that they are sustainable because they are profitable.”
Despite its arguments against the feasibility of an affordable EV for America, Stellantis does have cheaper products in the pipeline across the pond. The automaker has new models from Fiat and Citroen on the way for Europe, both of which are expected to be priced below €25,000 ($27,500) when they launch.
3rd Gear: Airlines Are Fighting For Spares After Pratt & Whitney Recall
After the sheer number of recalls we’ve seen in recent years, we’re all well aware of what goes down when a car gets recalled these days. But have you ever wondered what happens when another kind of vehicle gets called back for repairs? What about when a place is recalled?
Well that’s exactly what’s going on right now, as airlines around the world are scrambling to keep their fleets flying after engine maker Pratt & Whitney recalled 1,200 engines that need to be removed and inspected before they can fly again. According to Business Insider, the recall has left airlines fighting for spare parts and entire engines to keep their planes in the air. The site reports:
Pratt & Whitney announced last month that 1,200 of its engines would need to be removed from Airbus A320neo jets for “enhanced inspection.”
It said a “rare condition” had contaminated the powder metal, which could cause cracks to form on critical engine parts.
According to Business Insider, the engine manufacturer aims to carry out 200 of the inspections by mid-September. The remaining 1,000 engine inspections will take place over the next nine-to-twelve months.
While the inspections are ongoing, Airlines like JetBlue are attempting to lease alternate engines to keep planes flying, while Wizz Air told investors it was “considering temporarily scrapping some routes.”
4th Gear: Nikola Recalls All Its Electric Trucks
And while we’re talking about recalls, what about a road-going recall to round out TMS, just for good measure. This time, it’s EV startup Nikola, which has been forced to recall every electric truck it’s delivered due to battery issues.
According to Automotive News, the truck builder has recalled 209 battery-powered electric trucks and halted sales of its vehicles following a probe into a series of fires in its trucks. The site reports:
The preliminary findings of the probe by a third-party investigator were corroborated on Thursday by a “minor thermal incident” on one pack on a parked engineering-validation truck, the company said, adding that no one was injured.
“Foul play or other external factors were unlikely to have caused the incident,” Nikola said in a statement, adding efforts were underway to provide a remedy.
The company originally said it suspected foul play when it started an investigation in June after trucks at its Phoenix, Ariz., headquarters caught fire. One damaged truck, kept at the Phoenix site for monitoring, re-ignited last month.
Following the recall, Nikola asked customers and dealers to take precautions like parking their trucks outside while it rolls out a fix for the issue. According to the investigation, the fires were sparked by a single supplier component within the battery pack, which failed and led to the coolant leak that caused the vehicles to catch fire.