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Ford is boosting SUV production and adding 550 jobs at Kentucky truck plant

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A worker builds a Ford Expedition SUV as it goes through the assembly line at the Ford Kentucky Truck Plant in Louisville, Kentucky.

Ford said Tuesday it is boosting production of its Expedition and Lincoln Navigator sport utility vehicles and will be adding 550 new jobs at its Kentucky truck plant where it assembles the vehicles.

The automaker will also transfer roughly 500 workers from its nearby Louisville assembly plant to help handle the 20 percent increase in production, which is expected to begin in July.

The move indicates strong demand for the SUVs, which are based on the same platform and share many of the same features and parts.

Expedition sales rose 35 percent and gained 5.6 percentage points in market share in its segment last year. Customers paid an average of $62,700 for the SUV, about $11,700 more than the prior year. Sales of the Navigator, the more premium version of the two vehicles climbed 70 percent year over year to 17,839 units sold last year — it's best year since 2007.

The move also comes as Ford mulls cutbacks in its workforce elsewhere, particularly among salaried workers in the U.S. and different roles abroad, particularly in Europe. The automaker said last week it plans to cut about 5,000 jobs in Germany and an unspecified number in the United Kingdom. It also plans an unspecified number of cuts to its salaried U.S. workforce later this year. Ford said in 2018 it is undertaking an $11 billion plan to restructure its business and improve performance.

Shares of the second largest U.S. automaker have fallen 23 percent in the last 12 months, though they have risen more than 12 percent since the beginning of 2019, closing at $8.57 a share Monday. Its stock was up more than 2.5 percent in Tuesday's premarket.

In recent years, automakers have scrambled to keep pace with an ever intensifying shift away from more traditional passenger vehicles, such as sedans and compact cars, toward SUVs, pickup trucks and crossovers. Ford's cross-town rival General Motors has recently made headlines for its plans to idle sedan-heavy factories and cut jobs in the U.S.

UK’s first self-driving bus begins trials

Alexander Dennis Limited

Trials for a full-sized autonomous bus have started at a depot in Manchester, England.
The project makes use of a single-decker vehicle that can operate autonomously within the grounds of the Sharston depot, the Stagecoach Group said in an announcement earlier this week.
Using autonomous technology, the bus can undertake maneuvers including parking and moving into a washing area.

“This is an exciting project to trial autonomous technology on a full-sized bus for the first time in the U.K.,” Martin Griffiths, Stagecoach's chief executive, said in a statement.
Stagecoach has partnered with bus manufacturer Alexander Dennis Limited and technology firm Fusion Processing for the project.
The system used by the bus is Fusion Processing's CAVstar. It is made up of several sensors, including radar, ultrasound and optical cameras. Satellite navigation is also used in order to detect and avoid obstacles.
The system in the pilot vehicle will help to provide the basis for a forthcoming trial that will see five autonomous buses ferry passengers between Fife and Edinburgh, in Scotland.
Stagecoach said the buses will use a Level 4 standard of autonomy, meaning that a safety driver will need to be on board to comply with U.K. regulations.

Five “levels” of driving automation have been defined by SAE International, a global association of over 128,000 engineers. At Level 5, a vehicle's automated driving features can drive it under all conditions.
The Fusion Processing CEO, Jim Hutchinson, said that the company's CAVstar system had now been used on a range of vehicles, including two-seater electric cars and 12 meter, 43 seater buses.
The pilot in Manchester, Hutchinson added, offered a “glimpse of how future bus depots can be automated for improved safety and efficiency.”

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Tesla Gigafactory employees lined up for ‘Merch Madness,’ a chance to buy company swag on the cheap

Andrew Evers | CNBC
Tesla employees at the company's Nevada Gigafactory line up to buy discounted company merchandise in March 2019.

Tesla set up a pop-up shop just for employees at its Nevada Gigafactory this week, and sold them company swag on the cheap during a series of events it called “Merch Madness.”

The stunt helped boost employee morale during a stressful end-of-quarter push, which followed company-wide layoffs and store closures.

CNBC visited the sprawling battery plant during “Merch Madness” and observed lines to rival the opening day of a new “Star Wars” sequel.

Andrew Evers | CNBC
A screen in Tesla's Gigafactory advertising “Merch Madness,” a chance for employees to buy discounted company swag.

Among the items in the employee-only shop were:

A “Tesla Corporate Jacket,” which Tesla sells on its website for $175, but cost employees just $48 during the eventTesla caps that sell for around $30 at retail, but cost employees $6Items not currently available online, including a Semi Truck tee for $9, leather Corsicana tote bag for $102 and leather touchscreen gloves for $28.

Employees told CNBC they were stocking up on gear they wanted as well as gifts for family and friends. The company store took credit cards only. They get an employee discount year-round but the Merch Madness deals went beyond that, they said, so waiting on line was worth it.

In February 2019, Tesla set up a store to sell its branded apparel and accessories on Amazon.

Increased attention to branded merchandise at Tesla follows success in this arena for another Elon Musk business — The Boring Company sold $10 million worth of its “not-a-flamethrowers” in five days last year, and $1 million in baseball caps.

A spokesperson said that as of the week of March 4, Tesla employed more than 40,000 people. In its 2018 annual report, Tesla said it had 48,817 employees. Tesla has not disclosed exactly how many people it has laid off this year.

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Tesla brings back its referral program, sort of

NurPhoto | NurPhoto | Getty Images

Tesla is bringing back its once popular referral program in a new form just months after killing it, the company said.

But the program will be different from its previous incarnation, which Tesla said was too costly to keep up.

For every customer a Tesla owner refers, the company will give both people 1,000 miles of free use of its Supercharger charging network and will enter the referrer into drawings for a special edition of the Model Y crossover monthly and second generation Tesla Roadster quarterly, each signed by Tesla CEO Elon Musk and Chief Designer Franz Von Holshauzen.

“While our previous Referral Program was very successful, it came with significant costs, and ending the program last year allowed us to pass those savings along to customers,” Tesla said in a blog post Thursday night. “We've since restructured the program to save the company money while also offering rewards that are super exclusive.”

The program is not quite as fat with incentives as its forebears. The previous version of the program gave owners six months of free Supercharging with the purchase of a Model X SUV, Model S sedan or Model 3 midsize sedan.

The previous program also gave referrers a chance to win a variety of awards, including having a photo launched into space, new wheels, priority access to software updates and vehicles.

An even earlier version of the program offered some buyers free unlimited Supercharging. The new program gives those participants in the program a two chances to win a new vehicles in each period.

Electric taxis in Oslo to be charged using wireless technology

K'Nub | Moment | Getty Images

Taxis in the Norwegian capital, Oslo, are set to use wireless fast-charging technology to keep them running.
In an announcement Thursday, Finnish energy firm Fortum said it would work with the City of Oslo and Momentum Dynamics, a U.S. company, to build the system.
The project will use induction technology, with charging plates installed in areas where taxis, which will carry a receiver for the charging, park.
“We will install the wireless chargers at taxi stands, such as the one at… Oslo Central Station,” Annika Hoffner, the head of Fortum Charge and Drive, said in a statement.
“Taxis will be able to drive up to the charger and a wireless charging session will automatically start,” Hoffner added, explaining that taxis could charge while waiting for new customers.
The rollout of a wireless charging system in Oslo is part of a wider transition to cleaner types of transport in the country.

In 2018, there were 46,143 new passenger car registrations for battery electric vehicles in Norway, according to the European Automobile Manufacturers Association.

Sture Portvik, electric mobility manager for the City of Oslo, said that all taxis in Oslo would be zero-emission from 2023.

Volvo to put cameras and sensors in its cars to tackle drunk driving

Volvo Car Group

Volvo Cars is set to install in-car cameras and sensors to monitor drivers for signs of intoxication and distraction.

The firm said the technology will be used to monitor drivers and, when needed, enable the car “to intervene if a clearly intoxicated or distracted driver does not respond to warning signals and is risking an accident involving serious injury or death.”

Actions the car could take include limiting speed to slowing down and then parking the car in a safe place. Installation of the technology will start in the early 2020s.
Wednesday's announcement represents the latest attempt by the company to boost the safety of its vehicles. At the beginning of March, it announced it would introduce a 180 kilometers per hour (112 miles per hour) speed limit on all its cars from 2020.

“When it comes to safety, our aim is to avoid accidents altogether rather than limit the impact when an accident is imminent and unavoidable,” Henrik Green, Volvo Cars' senior vice president, research and development, said in a statement Wednesday.
“In this case, cameras will monitor for behavior that may lead to serious injury or death,” Green added.
The system, Volvo Cars said, will be on the lookout for a range of potentially dangerous behaviors. These include drivers who display a “complete lack of steering input for extended periods of time” or have their eyes closed or off the road for long periods. Technology will also monitor “excessively slow reaction times” and “extreme weaving across lanes.”
According to the National Highway Traffic Safety Administration (NHTSA), nearly 30 people in the U.S. die each day because of drunk driving crashes. There were 10,874 deaths in the U.S. from drunk driving crashes in 2017, the NHTSA adds.
“There are many accidents that occur as a result of intoxicated drivers,” Trent Victor, professor of Driver Behaviour at Volvo Cars, said. “Some people still believe that they can drive after having had a drink, and that this will not affect their capabilities. We want to ensure that people are not put in danger as a result of intoxication.”

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Crash tests slam some popular pickup trucks

Jeff Kowalsky | Bloomberg | Getty Images
A Ford Explorer XLT during a head on 30 mile per hour crash test at the company's Crash Barrier Facility in Dearborn, Michigan.

New crash tests show pickups with some of the oldest designs could struggle to protect passengers riding in the front seat.

The Insurance Institute for Highway Safety tested eleven mid-size and full-size pickups and found mixed results.

“In general, the pickup truck class of vehicles is not doing as good a job protecting right front passengers as other classes of vehicles,” said David Zuby, IIHS chief research officer.

Among the the full-size pickups, the Ford F-150, the Ram 1500 and Nissan's Titan received the best possible rating of “good” — one grade above the Honda Ridgeline which was rated “acceptable.”

By comparison, the IIHS says the Chevy Silverado 1500 and GMC Sierra provided “marginal” protection for passengers in the front seat when the right front corner of their truck slams into another vehicle or an object at 40 miles per hour.

Dan Flores, a spokesperson for General Motors says the automaker is continually working to improve the safety of it trucks. “GM designs our vehicles to protect the occupants in a broad range of crashes including front, offset, angle, side and rear impacts,” he said.

The IIHS gave a “poor” rating — the lowest possible — to the Toyota Tundra.

A spokesperson for Toyota told CNBC that “safety and reliability of its vehicles is a top priority.” He added: “We'll continue to look for ways to improve in an effort to exceed customers' expectations — particularly in new testing such as IIHS' passenger-side front small overlap (tests) for pickup trucks.”

Why might some of the most popular pickups struggle with protecting passengers in some of the most common front-end collisions?

The IIHS said part of the problem is that some pickups have older designs that did not emphasize front seat passenger protection to the degree it's expected today.

“We are reasonably confident that when those pickup trucks are redesigned, they will incorporate better protection for the front passenger,” said Zuby.

It's hard to know how much the tests will impact the decisions of truck buyers.

Pickup sales have been surging over the last five years, as more Americans have opted for a truck instead of driving a car. Last year, pickup sales in the U.S. climbed 4.3 percent, according to the auto website Edmunds, while auto sales overall were only fractionally higher.

Ford to build new factory in Michigan for autonomous vehicles

Bill Pugliano | Getty Images
Workers build a truck as it goes through the assembly line at the Ford Kentucky Truck Plant in Louisville, Kentucky.

Ford is building a new plant in Michigan for autonomous vehicles as the company realigns some factories to focus on its future lineup of self-driving and electric cars.

The new facility, scheduled to open in the next two years, will take new commercial-grade hybrid models and incorporate the self-driving technology needed to turn them into autonomous vehicles. Ford is still considering where to build the AV finishing center and has not said how many people will work there.

“This facility will be about more than just putting the brains into these autonomous vehicles,” said Joe Hinrichs, Ford's president of global operations. “We will use the AV production center to upgrade the interiors and add the technology customers will want for a particular self-driving model.”

The new autonomous vehicle, or AV, facility is part of a $900 Million investment Ford announced in 2017 to restructure its manufacturing footprint in Michigan. Ultimately, it's expected to create up to 900 new jobs by 2023. That includes adding a second shift in 2023 at the company's final assembly plant in Flat Rock, Michigan to build an all-electric vehicle the company has yet to announce. That 2023 model is part of Ford's plan increase sales of electric vehicles, including a brand new electric SUV scheduled to roll out next year. It will be built at a Ford plant in Mexico.

Ford's development of autonomous and electric vehicles is at the core of CEO Jim Hackett's plan to remake the automaker. Since taking over as CEO in 2017, Hackett has been criticized by analysts for moving too slow to reposition Ford as the auto industry shifts to new technology and focuses more attention on electric vehicles. Earlier this year, Ford announced a partnership with Volkswagen to share the costs of develop AVs and EVs.

Hinrichs believes Ford's plan to expand production of electric vehicles in Michigan four years from now will be well timed for the changing tastes of car buyers. “We see more consumers interested in electric vehicles. Plus the capabilities of the batteries and the technology is getting better,” he said.

Lyft IPO could be ‘$1 billion or more’ windfall for California’s coffers

Margarethe Wichert | Getty Images
The “Painted Ladies,” a row of historical Victorian homes, are shown with the San Francisco skyline in the background.

California could reap a bonanza of “$1 billion or more” in new taxes from the upcoming stock offering of ride-hailing service Lyft, according to state's former treasurer.

Experts say Lyft's initial public offering and an even bigger IPO expected in April from rival Uber will create many newly-minted millionaires in the Bay region. The state stands to benefit by taxing the capital gains from stock sales.

“We need those billions for education and other areas,” said John Chiang, the state's former treasurer and controller. He said new tax collections “may not happen all at once, and could be spread over time.”

According to its regulatory filing Monday, Lyft is gearing up for an IPO that values the company at near $20 billion. Lyft itself proposes to raise more than $2 billion in proceeds from the offering.

“If you're coming with a $19 billion valuation, you're talking about [a state income tax rate of] 13.3 percent for the millionaires,” Chiang told CNBC. “Even though we're looking at all-in state budget in excess of $200 billion and a general fund budget of about $140 billion-plus, $1 billion or more is significant.”

Lyft's two founders stand to get a big payday from the IPO and keep control of just under half of the company's Class B voting stock. CEO Logan Green's stake could be worth more than $540 million and the company's president John Zimmer's, valued just under $400 million.

For Californians, the state taxes capital gains like any other income. As of 2017, about 70 percent of the the state's general fund revenues come from personal income tax collections.

“IPOs are good for California's bottom line,” said Chris Thornberg, a founding partner with Beacon Economics. The economist said a larger share of the state's general fund today comes from personal income taxes than it did back in 2000 so it makes the state's revenue volatility a concern.

The top 1 percent of the state's personal income tax earners — roughly 164,000 tax returns — generate about half of the personal income taxes in California. A good chunk of the income from the wealthy comes from capital gains and stock options from companies in tech and other industries.

Meantime, Uber is reportedly planning to kick off its offering next month in a deal valuing the San Francisco-based company at a whopping $120 billion.

“When you're talking about Uber and its massive valuation, that's billions,” said Chiang, a Democrat who ran unsuccessfully for governor in 2018.

Other Bay-area tech firms also could join the IPO parade, including Airbnb and Slack.

“A couple of years ago there were reports of over 100 unicorn companies in the San Francisco Bay Area, and how if they ever went public could create extraordinary wealth,” said Chiang.

Chiang said new wealth in the Bay region from tech IPOs could increase housing market values in San Francisco and Silicon Valley. Yet he adds it also could worsen the region's affordability crisis.

“This is an incredible opportunity, and we need to use this as an example of California's prowess,” he said. “But we also should have sensitivity to doing smart things to continue to be the engine for the 21st century economy.”

Fiat Chrysler gains after Peugeot president points to merger potential

Daniel Acker | Bloomberg | Getty Images
A row of Fiat Chrysler Automobiles (FCA) 2017 Crysler Pacifica minivan vehicles are displayed for sale at a car dealership in Moline, Illinois, on Saturday, July 1, 2017.

Fiat Chrysler shares jumped on Tuesday to the top of Europe's STOXX 600 after the president of Peugeot family holding company FFP told French daily Les Echos he would support a new deal and suggested Fiat Chrysler was among the options.

“With them, as with others, the planets could be aligned,” Robert Peugeot was reported as saying, asked about targets for acquisitions or mergers.

Fiat Chrysler declined to comment.

Shares in the Italian-American carmaker were up 5.2 percent by 6:50 a.m. EST, while Peugeot gained 2.7 percent, helping boost Europe's autos index which was up 2.5 percent.

Peugeot's remarks came on the heels of reports the group's CEO Carlos Tavares is open to deals and that Fiat, General Motors, and Jaguar Land Rover could be ideal partners.

FCA's new boss Mike Manley, who took over after deal-making guru Sergio Marchionne died last year, said this month the carmaker was open to pursuing alliances and merger opportunities if they make sense and strengthen its future.

FCA is often cited as a possible merger candidate because of its strong exposure to the North American market, where it generates the lion's share of profits, and because of its popular Jeep, RAM and Maserati brands.

“PSA is essentially an EU pure play as things stand (roughly 90 percent of consolidated unit sales in EU) so an acquisition of a company with a broader reach would make strategic sense,” said Evercore ISI analyst Arndt Ellinghorst.

Investors and analysts alike were wary of betting on an imminent deal, though, mindful of potential antitrust obstacles.

“Although we believe that some M&A could materialize in the automotive sector, we do not expect it in the short term,” said Mediobanca Securities analyst Andrea Balloni.

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