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Ford to spend 90% of capital on trucks, SUVs; FCA trials Jeep subscription

TOP NEWS

* Ford Motor Co. executives said most of the company's capital will go toward pickup trucks and SUVs in 2019 to boost profitability. Jim Farley, Ford's president of global markets, speaking at a global auto industry conference in Detroit said the company is allocating 90% of its capital for trucks and SUVs, which he called the "fastest-growing, most profitable segments in our industry."

* Fiat Chrysler Automobiles NV is recruiting owners of its Jeep brand for a three-month pilot to rent out their vehicles through the online car rental company Turo Inc., Bloomberg News reported, quoting an interview with Tim Kuniskis, head of the Jeep brand in North America. The carmaker reportedly also is partnering with rental car company Avis Budget Group Inc. for another three-month subscription pilot that would enable Jeep owners to swap their vehicles for other Fiat Chrysler models. Both pilots will begin in the week of Jan. 21 in Boston and would be limited to the first 100 owners, Kuniskis reportedly said.

CARMAKERS

* A Tokyo court rejected Renault SA Chairman and CEO Carlos Ghosn's appeal against the court's dismissal of the executive's bail plea two days earlier, The Associated Press reported. The decision comes as French Economy and Finance Minister Bruno Le Maire called for replacing Ghosn as the company's chairman and CEO, saying the government, as Renault's largest shareholder, wants the carmaker's board to "designate a new, sustainable governance," the Nikkei Asian Review reported. Separately, Alliance-partner Nissan Motor Co. Ltd.'s seven-member special committee formed to improve the governance in the wake of Ghosn's dismissal as chairman will hold its first meeting Jan. 19-20, The Mainichi reported, citing a source with knowledge of the plan.

* Bayerische Motoren Werke AG said it plans to launch 25 new models in China in 2019 and reiterated its plans to increase its share in the Chinese joint venture, BMW Brilliance, to 75% from 50%. The company announced that BMW X2 will later in 2019 become the seventh BMW model to go into production in China, adding that locally produced BMW X3 will be its main growth driver in the country. The carmaker aims to increase the total capacity of its Dadong plant gradually to 650,000 units.

* Geely Automobile Holdings Ltd. will start building Lotus Cars at a 9 billion Chinese yuan factory in Wuhan, Hubei Province, in China, the first time the British sports car brand will be built out of its Norfolk, England-based site, Reuters reported, citing company job advertisements and Chinese government documents. Geely and Lotus reportedly said globally expanding its manufacturing footprint is a key part of reviving the Lotus brand. "Details on additional locations and models will be confirmed in due course," Geely said in an email to Reuters.

ELECTRIC AND AUTONOMOUS VEHICLES

* Ford Motor Co. said it will build a fully electric F-Series pickup, both battery electric and hybrid variants, which would "futureproof" the carmaker's profitable F-Series product line, the Detroit Free Press reported, quoting Jim Farley, Ford president of global markets.

* Tesla Inc. CEO Elon Musk tweeted that the electric-car maker's referral program, which gives new Tesla owners free access for six months to the company's Supercharger EV charging network, will end Feb. 1 as the initiative is "adding too much cost to the cars, especially Model 3." The ongoing referral program was initially scheduled to continue until March 11.

* Volkswagen AG's premium car unit Audi AG plans to roll out an electric crossover, about the size of its compact Q3 SUV, to take on Tesla Inc. in that segment, Bloomberg News reported, citing people familiar with the matter. The model reportedly would be made at VW's Zwickau, Germany-based site. An Audi spokesman told the news outlet that the unit aims to launch seven hybrid cars and five battery vehicles by the end of 2020, without elaborating on specific models.

* Chinese electric-car maker Kandi Technologies Group Inc. expects to ship two of its models, the EX3 SUV and the K22 mini EV, to the U.S. in 2019, becoming the first Chinese carmaker to enter the U.S. retail market, Bloomberg News reported, citing Kandi Chairman and CEO Hu Xiaoming. The company reportedly forecast producing 2,000 to 5,000 units in 2019 for the exports. Separately, Hu said Kandi is cooperating with other Chinese firms on an online car-hailing service alliance that could grow to a fleet of 300,000 in five years, Bloomberg reported.

* Koninklijke Ahold Delhaize NV's Stop & Shop grocery store chain will launch driverless grocery vehicles in the Greater Boston area in the spring of 2019. In partnership with San Francisco-based startup Robomart, the program will feature autonomous, electric and remotely operated Robomart vehicles that customers can summon using a smartphone app, the Dutch food retailer said.

POLICY, REGULATIONS AND SAFETY

* Sen. Chuck Grassley, R-Iowa, said President Donald Trump is "inclined" to impose auto import tariffs as a means to open up U.S. agricultural exports to the EU, the Financial Times (London) reported. Grassley, who is the chairman of the Senate Finance Committee, reportedly said "it would not necessarily be the best thing to do" but Europe is "very afraid" of the proposed tariffs. His comments come ahead of the U.S. Commerce Department's Feb. 17 deadline to publish a report to determine if auto imports pose a national security threat.

* The European Automobile Manufacturers' Association said it is "extremely disappointed" by the EU's decision to levy a 25% duty on certain steel imports until at least July 2021 as the regulations "pose a real risk" to the competitiveness of European automakers as they source nearly 94% of their steel in the EU.

* Jaguar Land Rover Ltd. said it is "disappointed" with the Brexit vote and is considering its implications even as it urged the U.K. lawmakers to rule out a no-deal "immediately" as the only option with majority support in parliament, Reuters reported, citing a release from the Tata Motors Ltd.-owned British luxury carmaker.

AUTO PARTS AND EQUIPMENT

* South Korean carmaker Hyundai Motor Co. and its affiliate, Kia Motors Corp., are recalling about 168,000 vehicles to inspect fuel tubes in replaced engines that have a potential fire risk. Hyundai said it will recall approximately 100,000 vehicles, which include Hyundai Sonata models from 2011 to 2014 and Hyundai Santa Fe SUVs from 2013 and 2014. Kia is recalling 68,000 vehicles, also to inspect fuel tube installations in engine replacements, The Associated Press reported, citing the company's memo to dealers.

* Adient PLC reported preliminary first quarter ended Dec. 31, 2018, revenue of about $4.16 billion, below the prior-year quarterly revenue of $4.20 billion, and said the automotive seating company is in talks with its bank group to evaluate refinancing options for its existing credit facilities and reviewing various portfolio changes. CEO Doug Grosso expects to see the benefits of an ongoing turnaround program "gaining momentum" in the second half of fiscal 2019.

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The day ahead

Early morning futures indicators pointed to a lower opening for the U.S. market.

In Asia, Hang Seng fell 0.54% to 26,755.63, while the Nikkei 225 was down 0.20% to 20,402.27.

In Europe, around midday, the FTSE 100 was down 0.52% to 6,827.00 and the Euronext 100 was down 0.26% to 934.70.

On the macro front

The U.S. Housing starts report, the jobless claims report, the EIA natural gas report, the Fed balance sheet and the money supply report are due out today.

Click here to read about today's financial markets, setting out the factors driving stocks, bonds and currencies around the world ahead of the New York open.

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