GM, Ford to idle two Michigan assembly plants next week

General Motors will cancel production at Lansing Grand River Assembly next week due to a temporary parts shortage, spokesman Dan Flores told Automotive News.

Flores did not disclose the nature of the parts shortage, but he said it was not related to microchips.

GM expects to resume production at the Michigan plant, which builds the Cadillac CT4 and CT5 and the Chevrolet Camaro, on April 11.

In another Michigan plant announcement, Ford Motor Co. on Thursday said it would halt production at its Flat Rock Assembly Plant in suburban Detroit next week, where it builds the Mustang, due to a global semiconductor shortage.

The auto industry is grappling with a global chip shortage triggered by the COVID-19 pandemic that has forced companies to cut production, although high vehicle prices have partially offset its impact.

The automaker had warned last month that the chip shortage would lead to a decline in vehicle volumes in the current quarter.

Last month, Ford halted production at its Kansas city assembly plant that makes F-150 pickup vehicles for a week due to the chip shortage.

Production at Ford’s other North American plants will continue as normal.

Hannah Lutz and Reuters contributed to this report.

Kyte announces a fleet of Tesla Model 3s for a $995/month subscription service across the US

Kyte announces a fleet of Tesla Model 3s for a $995/month subscription service across the US

Kyte, an on-demand rental company, announced that it is acquiring a fleet of Tesla Model 3 vehicles to offer a new monthly subscription service across the US starting at $995.

The concept of “subscribing” to a car instead of outright buying it or leasing it has gained traction in recent years. Several automakers and third-party companies have started such services, which have the main advantage of being simpler and requiring less commitment than leases – Tesla vehicles are starting to become a popular option for those services.

Earlier this year, Autonomy, a new startup, announced that it purchased a fleet of 100 Model 3 vehicles to offer a subscription service, and it aims to grow the fleet to 10,000 Tesla vehicles by the end of the year.

Now Kyte, better known as an on-demand car rental service, announced that it is jumping into the car subscription business also with a fleet of Tesla Model 3 vehicles:

This rollout of Kyte’s latest offering is the next milestone in a series of impressive successes by the California-based company and will eventually be available in all of Kyte’s current 14 markets. As part of this new subscription service, Tesla Model 3s will be available and will include maintenance, insurance, registration, and roadside assistance. For those looking for the experience of a Tesla, without the hassles of ownership and the long term commitment, Kyte’s offering will allow customers to reap all the benefits while avoiding the challenges – no maintenance and no lock-in. What’s more, for those that come to love the performance of their Tesla, Kyte provides the option to extend subscriptions flexibly at any time.

The company didn’t reveal how many Tesla vehicles it secured for the service, but it recently secured $200 million asset-backed credit financing to expand its offering.

The service is all-inclusive with registration, insurance, and more:

They are using the Tesla Model 3 Long Range AWD, and the website specifically mentions the Pearl White color, which is the base color.

It starts at $995 per month with a 12-month commitment, but you can subscribe to the car for just three months:

In comparison, Autonomy starts at $490 per month, but it requires a steep $4,900 “start fee.” The company revised those prices down just earlier this week, as Kyte announced its own service.

Erik Zahnlecker, Director of Product at Kyte, commented on the announcement:

Being able to expand our fleet and amplify EV adoption is mission-critical. We don’t want to only be innovators in how we give people access to cars, but we want to be a catalyst for the rapid change going on in the transportation industry as a whole. This rollout is pivotal to our growth strategy and core to our electrified, autonomous, and shared vision.

The company is going to start deliveries of the Model 3 vehicles on April 15.


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EV age launches a wave of new technologies

The growing demand for electric vehicles is upending the automotive supply chain at a time when it was already stressed by the coronavirus pandemic, rising material prices and semiconductor shortages.

The industry’s push for new technologies and solutions is enormous, and R&D work is underway around the industry.

During 2019 and 2020, the world’s top 20 automakers alone spent nearly $94 billion on R&D as EV product plans take hold, according to a report last year by the financial firm BDO.

Stellantis CEO Carlos Tavares has warned suppliers that they, too, must be prepared to absorb the cost of the technological transition.

“In this transformation of the industry, it’s not only about the OEMs,” Tavares said during a late February earnings call. “It’s also about the supplier base.”

The need is for innovations in motors, batteries, materials and production processes to get automakers up and running at mass-production scale in the new EV world.

It is a bumpy road.

Two rising EV startups, Rivian and Lucid, have seen their high-flying stock prices plummet as they struggle to produce their launch vehicles without enough parts to meet their original production targets.

Rivian CEO RJ Scaringe predicted on a March earnings call that the company expects to build about 25,000 of its R1T pickup, R1S SUV and EDV delivery vans this year, half the number it could make at its Normal, Ill., assembly plant if it had enough parts in the pipeline.

The story is similar at Lucid, which cut its production estimate for its Air sedan to about 14,000 vehicles this year from a previous target of 20,000.

“We’ve got about 250 suppliers worldwide, notionally about 3,000 parts. And this has been really a phenomenon of just a small handful of our 250 suppliers,” CEO Peter Rawlinson said on a February earnings call.

Rivian and Lucid have said that one solution to their supplier challenges is to bring more parts production in-house. Rivian will develop its own electric motors for future versions of its vehicles, and it even is considering getting into the battery business, Scaringe said. Lucid didn’t detail which parts it could make itself in the future.

The troubles at Rivian and Lucid illustrate a trend for all makers of EVs. Lithium supplies, rare-earth metals, magnets for electric motors and battery assembly are now as important to their future as great vehicles and efficient assembly plants.

“Currently, the raw materials are quickly becoming the bottleneck,” said Sam Fiorani, vice president of global vehicle forecasting at AutoForecast Solutions. “With the gradual growth of the EV market, the supply chain for motors and batteries will grow to accommodate that volume. Commodities such as nickel, lithium and cobalt are poised to slow this growth.”

General Motors has formed joint ventures for lithium supply with California startup Controlled Thermal Resources and with LG Energy to make GM’s proprietary Ultium batteries.

Automakers all over the globe are forming alliances with lithium miners and battery makers, and even locking down supplies of rare-earth metals needed for permanent-magnet electric motors, which dominate the industry.

Securing the supply chain as quickly as possible will be key for automakers if they are going to compete in an EV market that will soon become extremely competitive, Fiorani said. He cited the non-EV example of Ford’s switch to aluminum for its F-150 pickup, the bestselling vehicle in the U.S.

“Like Ford’s plan to secure sourcing of aluminum for the F-Series years ago, forward-thinking EV makers are locking in their own supply of these key ingredients, and that could leave other automakers short of these important materials,” he said.

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Tesla extends Shanghai plant suspension amid lockdown, report says

SHANGHAI — Tesla Inc. is extending a production halt at its Shanghai factory, an internal notice seen by Reuters showed.

The Shanghai factory, located in the Pudong district east of the city’s Huangpu River, suspended production from Monday to Thursday after the city launched a two-stage lockdown to combat a surge in COVID-19 cases.

The lockdown on districts east of the river is scheduled to lift in the early hours of April 1 and the U.S. automaker initially planned to resume production that day. However, the latest notice seen by Reuters said that this will now be extended.

Two people familiar with the matter said Tesla had yet to secure permits from Shanghai government for its trucks to deliver assembled electric cars outside of Pudong to western parts of the city.

Shanghai is set to lock down areas west of the river from the early hours of Friday morning.

The company may have also opted to extend the suspension as it may not have enough workers with lockdowns continuing on some housing compounds due to the discovery of positive COVID-19 cases, one of the people said.

Tesla declined to comment on the suspension of production.

It told Reuters it strictly implemented China’s epidemic prevention and control requirements and would adjust its work based on the government’s COVID-19 prevention policies.