Auto Industry News: GM Axes Holden, Ford Sets a Reveal Date for Bronco, and FCA Racks Up Some Lawyer Fees

With GM gobbling headlines this past week as it cancels Holden, pulls out of Thailand, and begins doubling down on EVs, we thought it was time to do a little deep-dive into the goings-on at all the Detroit bigwigs. Ford and FCA have been busy too, as the Blue Oval prepares for some big vehicle debuts and the Italian-American automaker cuts some fat checks to its legal team.

So, buckle in because here’s the Big Three news dump you’ve been waiting for.

GM Makes Major Moves As It Enters Electric Phase

GM is clearly going all-in on an EV future dominated by self-driving technologies. The automaker has announced plans to unveil 20 different fully-electric vehicles by 2023, earmarking a $3 billion investment to help it get there. Unfortunately, that money’s gotta come from somewhere and GM’s recent penny-pinching is resulting in a reorganization of “global priorities.”

RIP Holden

The first operation to get the ax? Holden, the 164-year-old company that essentially stood as General Motor’s Australian division, announced last week that it will be shut down by 2021.

“GM has taken this difficult decision after an exhaustive analysis of the investment required for Holden to be competitive for the long term in Australia’s and New Zealand’s new car markets,” said the company via press release. “Regrettably, this assessment determined such an investment could not meet GM’s investment thresholds, including delivering an appropriate return.”

“Factors weighing against further investment in Holden included: the highly fragmented right-hand-drive domestic markets; the economics to support growing the brand; and delivering an appropriate return on investment,” the statement continued. It also noted that the “global consolidation” of the overall industry makes it difficult to support (read: justify) a “business that operates in only two markets.”

This is sad news, though likely not entirely shocking for those who have kept an eye on the Australian auto market. Holden ceased making vehicles in 2017 and became an all-import brand the following year. When GM pulled out of Europe in 2013 and then sold its Opel/Vauxhall brands in 2017, effectively bowing out of right-hand-drive (RHD) vehicle production, the writing for Holden was on the wall.

While the statement made no mention of the jobs lost from this down-sizing effort, reports indicate roughly 600 layoffs. “I am disappointed but not surprised,” said Australian Prime Minister Scott Morrison. “But I am angry, like I think many Australians would be. Australian taxpayers put millions into this multinational company. They let the brand just wither away on their watch. Now they are leaving it behind.”

“Bye-Bye Thailand”

Interestingly, while GM insists the decision to scrap Holden was only made recently, the news that the automaker is selling its Thailand factory (aka Holden’s source for its biggest-selling model) seems to imply otherwise. “Deals like that don’t happen overnight,” an anonymous source told Australian automotive network, CarAdvice. “Talks of the sale began at least four months ago, so you can comfortably deduce from that, GM knew at least at that time the days were numbered for Holden.”

Regardless of what you choose to believe, the deal is done: GM has sold two plants in the eastern industrial province of Rayong to China’s Great Wall Motor and will begin laying off 1,500 employees in June. According to Reuters, “GM will abide by Thai labor law and provide severance pay for the affected employees. The company will also grant an additional four-month bonus to all employees.”

While both this news and that of Holden’s end are distressing, they’re not exactly outside the norm for GM these days. As noted, the automaker began backing out of the RHD market several years ago and, more recently, made plans to shutter several plants across the U.S. and Canada.

With reports indicating that, compared to its fellow American automakers, GM stands the most to lose from the coronavirus outbreak, we wouldn’t be shocked to see some more aggressive cost-cutting strategies crop up in the future.

Detroit-Hamtramck Assembly Ready to Go Electric

On a lighter note, next week will mark a historic day at Michigan’s Detriot-Hamtramck factory, with the facility set to produce its last Chevy Impala before transitioning into an all-electric vehicle producing site.

Electric motors and battery packs will replace traditional engines and transmissions thanks to a lofty $2.2 billion investment for retooling that will begin in March. According to The Detroit News, the plant will build electric Hummers in late 2021, followed by the electric ride-share shuttle called Cruise Origin.

Ford Gears Up For Big Vehicle Debuts

Never one to pass up a golden opportunity, not only has Ford assured the Australian government that it is committed to remaining in the land down under, but it also said that it may be able to offer jobs to some of those 600 laid-off Holden workers, according to ABC News.

Whether or not those reassurances have a long expiration date on them remains to be seen but, at least for now, Ford seems less concerned with penny-pinching and more focused on nailing its big upcoming vehicle debuts.

March Reveal Confirmed for Bronco

After what feels like eons of hype, rumors, and fan speculation, we finally (finally!) have an official date for the much-anticipated Ford Bronco reboot. Well, we have a month, and that’s a seemingly positive start, to say the least.

According to the automaker, the long-awaited burly, body-on-frame off-roader will make its official debut at a standalone event in March, while its smaller unibody sibling the “Bronco Sport” (or Baby Bronco as many enthusiasts have dubbed it) will make its arrival at the New York Auto Show in April. Reports indicate that Ford will launch both two and four-door variants simultaneously with models expected to arrive in showrooms by early 2021. The automaker will also launch an entire catalog of in-house Bronco accessories, ensuring dealers can capitalize on a have-it-your-way Bronco lifestyle.

Pricing is still vague, but should land around $30k for the new Bronco, with the smaller version undoubtedly costing less. Ford predicts it will sell at least 200,000 models during the first year of its release. With the near-rabid excitement for its arrival, we’d say that’s a safe bet.

Spy Photos Show Redesigned Ford F-150

Also on Ford’s list of launches-we-can’t-afford-to-foul-up is the newly redesigned F-150. Spy photos have emerged of the 2021 Ford F-150 prototype with virtually no camouflaging on the front end.

Looking pretty darn production-ready, it also looks pretty darn good. Overall, not a whole lot has changed, aside from a streamlined grille and headlight design, which we’re okay with. (If it ain’t broke…) More noteworthy, is that Car and Driver reports this upcoming F-150 “will be built on a new body-on-frame platform that will support plug-in-hybrid and electric powertrains.”

The 2021 F-150 should debut sooner than later, as Ford will be itching to reveal its new electric F-150 now that the Mustang Mach-E is out of the bag. Here’s hoping the company’s launch goes better than the 2020 Explorer, which has been riddled with accusations of manufacturing and quality control issues, as well as several recalls.

While any redesign is a big deal, this one is particularly important since the F-150 is Ford’s bread and butter—as well as the country’s best-selling pickup line for 40+ years. With the company’s big restructuring underway, it can’t afford any more flubbed launches.

FCA Faces Legal Ups & Downs

In another life, I hope to be a lawyer for Fiat Chrysler because the sheer number of billable hours they must be racking up would be enough to make me jump for joy on the daily.

FCA Nabs Small Victory Against GM

Remember when we reported that in light of FCA’s not-so-kosher dealings with the UAW, fellow automaker GM filed a civil racketeering lawsuit alleging bribery, conspiracy, and corrupt labor negotiations among other wrongdoings? Well, FCA can thank its lawyers, because this week U.S. District Judge Paul Borman allowed a delay in the case while he looks into dismissing the whole thing.

“We are pleased with the judge’s decision to deny General Motors’ motion seeking immediate discovery,” FCA said in a statement, calling the claims “meritless and malicious.”

The Detroit News reports that the postponement of discovery applies to four interrogation requests, as well as 55 broad document requests GM has made of FCA, tracing back more than 10 years. It also applies to the list of 36 demands GM made to the UAW, including the 1.9 million documents the union turned over to federal investigators amid the now very-famous corruption probe.

While this is for sure a short-term win for FCA, we’ll have to see if it has long-term legs. “[GM] has until March 9 to submit its response to Fiat Chrysler’s request for the judge to dismiss the case,” says Detroit News.

FCA Dealers Threaten to Sue Over Unfair Incentives

Unfortunately, it’s not all good news for FCA. Remember that sales bank issue we covered a few months ago? Well, that scandal is still nagging our Italian-American friends. In addition to a $40 million fine the automaker must pay to the U.S. Securities and Exchange Commission, it now faces a lawsuit from the New York Automobile Dealers Association for creating “discriminatory and illegal two-tiered pricing in favor of larger, competitive Fiat Chrysler dealers compared to smaller dealers.”

Automotive News explains: “The frustrations spring from Fiat Chrysler adopting a system that attempts to anticipate the types of vehicles dealers are likely to order and aligns those internal analytics with manufacturing.” However, the vehicles FCA is building and the vehicles dealers are actually ordering don’t match up. “[This] saddled the company with tens of thousands of unassigned vehicles last year. The automaker has cleared that inventory by offering incentives that have been cause for consternation at the dealer level.”

Basically, FCA is aggressively dropping prices to try and clear out that surplus, along with offering dealerships special “bonus-cash coupons” for buying up said vehicles. The suit takes issue with those vouchers, saying that larger dealerships who have more cash on hand can buy up those surplus vehicles and benefit, while smaller dealerships can’t.

We’ll have to wait and see how this one shakes out in the coming months but our gut tells us FCA’s lawyers will be taking some really nice vacations this summer.