Good morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. We’ve got the stories you need to know. We’ve got them right here.
1st Gear: This Is Shaping Up Fine
Gosh, this trade war with China sure is going well. Tesla had to jack up the prices of its cars, BMW has some problems of its own to work out, a soybean carrier tried to race to beat the tariff clock (and failed).
And now Michigan is being placed squarely in the crosshairs of all the fun, as The New York Times reports. (Yes, trade wars are fun.)
The Times digs in and chats with several locals in the know, and the upshot is captured beautifully by a local lawyer He Xian, who helps coordinate Chinese investment in Michigan. Xian had a client lined up to set up a $10 million R&D facility in the state, according to the Times, but “recently chose to go to Germany instead because of concerns over new regulations on licensing and technology transfer.”
“We need predictable, stable policies,” Xian told the Times. “Without certainty, nothing can happen.”
Over the past several years, Beijing has steadily pumped billions of dollars’ worth of investment into Michigan, buying crumbling factories, building new ones and supporting more than 10,000 jobs in the state.
But where Michigan sees an economic partner, President Trump sees an “economic enemy” — one intent on overtaking America’s competitive edge by stealing technology, trade secrets and jobs from domestic companies.
As Mr. Trump tries to punish China with tariffs and other restrictions, Michigan is caught in the cross hairs, with its ability to remain competitive and develop emerging technologies like autonomous vehicles, robotics and artificial intelligence highly dependent on ties to international markets, including China.
Imagine that!
2nd Gear: Car Regulator Sees No Need To Regulate Autonomous Cars
The first half of 2018 has been plenty busy for self-driving cars—and by that I mean several high-profile accidents, including one that left a pedestrian dead, have consumed headlines and made people generally very uneasy about the prospect of autonomous vehicles on our public streets.
I’ll underscore that point once more for those in the nosebleed seats: a pedestrian died this year at the hands of a self-driving car, and a Tesla Model X driving in the car’s semi-autonomous Autopilot function wound up in a fatal crash of its own.
Self-driving car regulations are thin as can be at this point, and so a curious observer might think a spate of serious crashes would spark the federal government to implement some sort of oversight.
Not so, according to the National Highway Traffic Safety Administration’s interim director.
“At this point the technology is so nascent I don’t think it is appropriate today to regulate this technology,” Heidi King, deputy administrator of the National Highway Traffic Safety Administration, said in an interview. “It’s not there yet, but each and every day we are open to identifying when the time is right.”
King’s comment reaffirms the agency’s commitment to a hands-off approach to rules for autonomous vehicles that safety advocates have criticized for being too lax. The Uber Technologies Inc. self-driving SUV that struck and killed a pedestrian in March fueled fresh calls for oversight, and Senate Democrats have slowed legislation in the chamber that would ease the path for companies to put more self-driving vehicles on the road.
Love that deregulation.
3rd Gear: Everyone’s Gearing Up To Testify At The Tariff Hearing
There’s a public hearing coming up on President Trump’s proposed 25 percent tariff on all—yes, all—imported cars. And a whole army’s ready to speak out about against the idea, reports Reuters:
The European Union, Japan, Canada, Mexico, along with automotive trade groups, Volkswagen AG (VOWG_p.DE), and the United Auto Workers union are among those scheduled to testify at a July 19 hearing on the Trump administration’s investigation into whether imported autos and parts pose a national security threat, according to a document seen Thursday by Reuters.
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Among those testifying are Canada, the EU, Mexico, and South Africa’s ambassadors to the United States, along with other government officials from Korea, Malaysia, Taipei, Turkey as well as the China Chamber of International Commerce. Executives from Volkswagen, Polaris Industries Inc (PII.N), LG Electronics Inc (066570.KS), auto parts firm Jtekt Corp (6473.T) and Sumitomo Rubber Industries Ltd (5110.T).
Trump’s national security investigation into the cars could lead to a spike in vehicle prices overall, so this sort of response isn’t surprising. The hearing should be a good time.
4th Gear: Used Dealers Struggling To Comply With Federal Regulations
Amid this very quiet year of calm and ease, I happened to miss that the Federal Trade Commission implemented a new regulation in January for used car dealers. Cleverly titled the Used Car Rule, it took effect Jan. 28, and it requires dealers to display updated window stickers with a bunch of information.
The FTC checked in to see how dealers were doing and, lo and behold, they mostly failed, reports Automotive News.
Just 14 of 94 dealerships inspected by the Federal Trade Commission and local partners in 20 cities from April through June had proper buyers guides displayed on the windshields of all used vehicles for sale, the agency said Thursday.
Under the Used Car Rule that took effect Jan. 28, dealerships must display updated window stickers, which contain warranty and other important information for consumers, on each used vehicle for sale.
The dealerships will get a second chance at a follow-up inspection some time soon, but if they fail again, they could face a penalty of up to $41,484 per violation, reports the News. Yikes.
5th Gear: Grand Prix Might Leave Detroit
Surely you have a NIMBY issue of your own, and in Detroit, for reasons that could fill several blogs of its own, one of them is the Grand Prix that happens every year on the lovely Belle Isle park.
The main issue is that organizers behind the Chevrolet Detroit Grand Prix take three months out of the year to set up and tear down for a race that lasts one weekend. Effectively, this leaves a swath of the island—a public state park—out of reach for, well, the public. There’s traffic issues, environmental concerns, and the basic notion that a private entity is making use of public property for such a long period of time, every year.
Now, the organizers need to renew their contract. And on cue, they’re threatening to bail if an agreement isn’t reached.
If the Chevrolet Detroit Grand Prix doesn’t get a new contract to race at Belle Isle, the event likely won’t be held in Michigan, the event chairman said Thursday.
Grand Prix leaders will present a detailed proposal Friday to the Belle Isle Advisory Committee at its regular monthly meeting requesting that the annual IndyCar race continue on the island, located east of downtown in the Detroit River.
The contract for the race, which took place June 1-3, expired this year. If it is not renewed, Grand Prix Chairman Bud Denker said in an interview Thursday, there’s no alternative site in metro Detroit.
This is like a low-key version of sports team owners threatening to leave town if the government doesn’t cede millions in public money to build a new stadium. Whatever the case, I’m definitely interested to see what happens.
Reverse: See Ya, Lee
Neutral: Who Gets Most Screwed In The Trade War?
When do we start winning exactly?