Honda can’t be rushed, airlines are confident they’ll be able to take your money again, and Alfa Romeo still can’t catch a break. All this and more in this Friday edition of The Morning Shift for April 23, 2021.
1st Gear: Honda’s Going To Do This Slowly
Volvo has said it’s going all-electric by 2030, as has Ford (but only in Europe). General Motors is targeting 2035, tentatively. Honda, too, has charted a course for its future free of internal combustion engines. It’s just not rushing into anything. In fact, it doesn’t expect to phase out gas cars globally until 2040. From Automotive News:
Honda will achieve the goal in steps, first deriving 40 percent of its sales in major markets from pure electric and hydrogen fuel cell vehicles in 2030. It wants that share of EVs and fuel cells to reach 80 percent in major markets in 2035, and then 100 percent in all markets by 2040.
Japan’s No. 3 automaker also set out lofty 2050 goals of achieving carbon neutrality in all products and corporate activities and of realizing zero traffic fatalities in its motorcycles and automobiles. It also wants to develop products from 100 percent sustainable materials.
“The hurdles are quite high,” said [CEO Toshihiro] Mibe, who was previously head of Honda’s R&D division. “But I think we can get them. The fact that we have set targets clearly is the first step toward that goal.”
Now, 80 percent of sales going to EVs and fuel cells by 2035 seems like a more realistic goal than what many other automakers have let on, particularly because these targets are contingent on governments in various countries facilitating infrastructure development. Perhaps Honda’s one of the few willing to be pragmatic about its timeline.
On on the other hand, I can’t help but think that much like Toyota, Honda was caught sleeping. It offers just one battery EV that nobody is buying, despite it looking extremely charming. Even though the company announced a plan to electrify all its “mainstream car models” by 2022, it’ll mostly rely on hybrids. Honda’s current range in the U.K. is already about half hybrids as it is (the closest vehicles it sells to SUVs or trucks over there are the HR-V and CR-V) so that wouldn’t appear to require much heavy lifting.
(Honda does have some other EVs in the mix, including its electric SUV it just showed in Shanghai, but those are through its joint ventures in China.)
Perhaps the most damning detail of this news is that Honda doesn’t expect its dedicated EV platform to hit the market until “the second half of this decade.” It’ll be called e:Architecture, and it’ll supposedly arrive in North America first. Hyundai and Volkswagen are already bringing their first cars built on their modular, cutting-edge electric platforms to market this year, but Honda projects it’ll need another four years at least to reach that point.
2nd Gear: Stellantis Plant Employee Dies In Workplace Accident
An employee at Stellantis’ stamping plant in Sterling Heights, Michigan died on Wednesday when a press machine he was lifting with a crane fell on him, according to an initial police investigation. A Stellantis spokesperson provided the following statement to the Detroit Free Press:
“Stellantis confirms that there was a workplace accident at the Sterling Stamping Plant on April 21, resulting in the death of one of our employees. The incident is currently under investigation. We extend our deepest condolences to the family and friends of our employee.”
The United Auto Workers released information regarding two other workplace fatalities involving its members in 2020 in June and December. In both cases, the employees were crushed by a falling object. The latest data from the Bureau of Labor Statistics reports that 732 people across all industries died on the job in 2019 as a result of “contact with objects and equipment” — a reduction of 54 deaths compared to 2018.
3rd Gear: The Airlines Are Healing
A number of major airlines appear confident that the worst of their pandemic losses are behind them, and the industry is recovering. The Wall Street Journal reported yesterday that Southwest Airlines actually turned a profit in the first quarter of 2021 — thanks in some part to government aid — while American Airlines recorded its smallest loss of the past year.
Southwest, American and other airlines are recalling pilots and flight attendants who haven’t been needed for months, preparing for what could be a bustling summer of vacations and family visits that travelers put off during the pandemic. American said it plans to hire 300 additional pilots late this year.
Southwest said it expects that by June its operation will stop losing more cash than it takes in. The airline’s first-quarter profit was lifted by $1.2 billion in federal aid that covered salaries and benefits during the quarter. Adjusting for that and other one-time items, Southwest reported a loss of $1 billion.
Airlines have had their hopes for a travel rebound dashed before. Each time last year it seemed like Covid-19 cases had leveled off and demand started to pick up, another surge wiped out the tepid demand increases. Even as case numbers have started to climb again, airline executives hope that widespread vaccination will mean that the increases in passengers’ bookings will stick this time.
The industry doesn’t expect travel to truly return to pre-pandemic numbers until late 2021, when employees may begin heading into offices again. Nevertheless, fares are already beginning to rise as people plan their vacations, and one airline — Alaska Air Group — even reports that their fares are in some instances exceeding 2019 levels. Pent-up demand and the need for distraction has driven up the cost of so many goods in the last year. I suppose it was only a matter of time until it hit airline tickets, too.
4th Gear: Say It Ain’t So, Giorgio
Alfa Romeo is bidding an early farewell to Giorgio, the architecture that underpins the Giulia and Stelvio. The platform wasn’t designed with battery EV use in mind, and thus Alfa will be moving to Stellantis’ STLA large-vehicle architecture for upcoming models.
It marks another tough loss for Stellantis’ core luxury brand, as Giorgio was to be the basis of its revitalized lineup throughout the 2010s. From Automotive News:
An Alfa Skunkworks team of engineers, designers and stylists developed technical innovations for the [Giorgio] platform such as double-clutch Torque Vectoring in an effort to create sector-leading driving dynamics.
Alfa’s 2014 revival strategy planned for eight models to be launched by the end of 2018 with global sales projected to grow to 400,000 vehicles by 2018 from 74,000 in 2013.
At that time, FCA said the Giorgio architecture was “flexible enough to be used by the Chrysler and Dodge brands because Alfa alone cannot generate sufficient volume to achieve worthwhile economies of scale.”
No other FCA brands adopted the platform because it was too expensive. It is only used by the Giulia and Stelvio. The Maserati Grecale midsize SUV, which launches later this year, will use the platform because it shares underpinnings with the Stelvio.
I’m no economist, but getting two vehicles out of a plan that was supposed to yield eight does not sound like a mouthwatering return on an investment to me. Better luck next time, Alfa.
5th Gear: Tokyo Motor Show Breaks Perfect Attendance
For the first time since its inception 67 years ago, the Tokyo Motor Show will not go on. The event is held every other year, so while there was no 2020 running to get cancelled, that unfortunately will not hold true for the 2021 iteration. It had been scheduled from October 20 until October 31.
A surge in new COVID-19 cases in Japan, reportedly brought on by more infectious variations of the disease, have squandered chances for the event this year. There were no plans to hold it in a virtual capacity either, according to the BBC.
The organisation’s chairman Akio Toyoda, who is also the president of Japan’s biggest carmaker Toyota, said the event was called off because “it is difficult to offer our main programme in a safe and secure environment”.
The show’s organisers also said that, unlike other major industry exhibitions that have moved online during the pandemic, there were no plans to make it a virtual event.
The cancellation comes as Japan’s Prime Minister Yoshihide Suga is expected to declare a state of emergency in several parts of the country, including Tokyo and Osaka.
These latest developments come just three months before Japan is scheduled to host the 2020 Olympics, which have already been delayed by a year.
As an aside, the Shanghai Auto Show has gone on as scheduled in China this month, though COVID-19 testing has been required for all guests.
Reverse: A B.A.T. Is Born
Abarth and Bertone rolled up to the Turin Motor Show on April 23, 1952 in this stunner, the Abarth 1500 Biposto Bertone B.A.T. (that stands for Berlinetta Aerodinamica Technica). You can drive it in Gran Turismo Sport!
Neutral: Will Alfa Romeo Ever Be A Thing In The U.S.?
Alfa Romeo returning to our shores was a constantly delayed dream throughout the 2000s. (Remember when GM was going to help them do it?) Then it did finally happen, but considering the brand has only sold two mainstream models since its return, it also feels like it kind of hasn’t. Alfa’s best laid plans are constantly dashed, and part of me is amazed Stellantis is still making the effort at this point.