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Tesla in talks with Glencore for cobalt; Magna expects sales to fall in 2020

TOP NEWS

* Tesla Inc. is in talks with Glencore over a long-term contract that would see the Swiss commodities trader supplying cobalt to the electric-car maker's Shanghai factory, Bloomberg News reported, citing people familiar with the matter. A spokesman from Glencore declined to comment, while a representative for Tesla did not immediately respond to a request for comment, according to the report.

* Canadian parts-maker Magna International Inc. scrapped its partnership with Lyft Inc. to co-develop self-driving technology and announced outlook for 2020 and 2022. The company expects 2020 sales to be "negatively impacted," compared to 2019, due to stronger U.S. dollar, sale of fluid pressure and controls business and lower light-vehicle production in Europe. Magna expects attributable net income of $1.8 billion to $2 billion and total sales of $38 billion to $40 billion in 2020. For 2022, Magna expects an EBIT margin between 7.6% and 8% and sales ranging between $40.5 billion and $43.5 billion.

CARMAKERS

* The three main Detroit automakers will see an increase in hourly labor costs through 2023, according to the Center for Automotive Research. The new United Auto Workers four-year contracts for General Motors Co., Ford Motor Co. and Fiat Chrysler Automobiles NV which were ratified toward the end of 2019, will increase average hourly labor costs, said Kristin Dziczek, the center's vice president of industry, labor and economics.

* Renault SA Chairman Jean-Dominique Senard said there is "no stress" to name its new CEO and praised interim CEO Clotilde Delbos as being "extraordinary," Reuters reported.

* General Motors said it will regularize over 1,350 hourly workers in 14 plants and other sites in eight states during the first quarter of 2020.

* Bayerische Motoren Werke AG said it will upgrade 33 models to include its mild-hybrid technologies in 2020, bringing its total number of models compliant with the Euro 6d emission standard to 73.

ELECTRIC VEHICLES

* Hyundai Motor Co. and Kia Motors Corp. said they will invest a combined €100 million in U.K.-based electric vehicle startup Arrival under a new partnership to co-develop "competitively priced" electric commercial vehicles. Under the partnership, the South Korean carmakers will gain access to Arrival's modular and scalable "skateboard" vehicle platform and technological know-how, while Arrival will benefit from their global footprint and economies of scale.

* Mercedes-Benz parent Daimler AG and Chinese electric-car maker BYD Co. Ltd. invested an additional 700 million yuan in Shenzhen DENZA New Energy Automotive Co. Ltd., their China-based new-energy vehicle venture, Gasgoo reported, citing data platform Tianyancha.

* Tesla's sales in California plunged 46.5% in the fourth quarter of 2019 to 13,584 vehicles as a tax-incentive program for electric vehicles expired, Reuters reported, citing a Dominion Cross-Sell report.

* Guangzhou Automobile Group Co. Ltd. confirmed that it is in talks with Chinese electric-car maker NIO Ltd. about a financing proposal but clarified that any potential investment would not exceed $150 million. The development comes after a Sina report said the state-owned carmaker is preparing to invest up to $1 billion in NIO, sending the startup's shares up as much as 19% in New York trading.

MOBILITY SERVICES

* Toyota Motor Corp. will roll out its multi-modal mobility service, My Route, to more Japanese cities in 2020. My Route allows users to plan and book trips with its app, which combines bus, taxi, train, ride-hailing and car rental platforms along with a ticket reservation and payment service.

* Toyota said it invested $394 million in Joby Aviation under a partnership that will help the aerospace company develop an all-electric vertical take-off and landing aircraft.

POLICY, REGULATION AND SAFETY

* Nissan Motor Co. Ltd. said its investigation into the financial misconduct by ex-Chairman Carlos Ghosn found that many more people were involved and that the irregularities were occurring in Japan and overseas. The Japanese carmaker said it will continue its investigation into other involved parties but said it already fined three unnamed senior officials for their misconduct.

* The Trump administration threatened to slap 25% tariffs on European automobiles, days before Germany, France and Britain accused Iran of violating the 2015 nuclear deal, The Washington Post reported, citing European officials. A senior U.S. official, however, told the publication that Europeans were already moving toward triggering the dispute resolution before the threat was issued, according to the report.

* Ferrari NV said it will recall 982 vehicles equipped with Takata Corp.'s potentially deadly airbags, Cnet reported.

* Japanese attorney Junichiro Hironaka and his team resigned as legal representatives for former Nissan chairman Carlos Ghosn following the executive's illegal escape to Lebanon, Bloomberg News reported. Takashi Takano, who won bail for Ghosn in 2018, also resigned, though Hiroshi Kawatsu will continue representing the executive.

AUTO PARTS AND EQUIPMENT

* Volkswagen AG-owned Audi said it teamed up with wheel-maker Cromodora to set up a wheel plant in Eastern Europe. The site will produce tires exclusively for Volkswagen's brands and is set to begin production in 2023.

AUTOMOTIVE RETAIL

* New-car registrations increased 1.2% year over year to more than 15.3 million across the European Union in 2019, marking the sixth consecutive year of growth. The EU saw vehicle registrations jump 21.7% year over year in December at 1.2 million vehicles, thanks to lower-than-usual results from 2018, according to the European Automobile Manufacturers Association.

* Peugeot SA sold 3.5 million vehicles worldwide in 2019, a more than 10% decline compared to 3.9 million vehicles sold in 2018.

* Used-car dealer Uxin Ltd. said it agreed to sell its salvaged-car auctioning business called Fairlubo to Beijing Hengtai Boche Auction Co. for 330 million Chinese yuan. Uxin expects the deal to close in the first half of 2020.

* Fiat Chrysler launched its Dealer Diversity website, which aims to provide minorities and women in North America with more opportunities to own and operate auto dealerships.

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The day ahead

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

In Asia, the Hang Seng gained 0.38% to 28,883.04, while the Nikkei 225 was up 0.07% to 23,933.13.

In Europe, around midday, the FTSE 100 was down 0.43% to 7,609.75, and the Euronext 100 decreased 0.10% to 1,156.67.

On the macro front

The jobless claims report, the Philadelphia Fed business outlook survey, the retail sales report, the import and export prices report, the business inventories report, the housing market index, the EIA natural gas report, the treasury international capital, 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.

The Daily Dose is updated as of 8 a.m. ET. Some external links may require a subscription. Links are current as of publication time, and we are not responsible if those links are unavailable later.