TOP NEWS
* Several Fiat Chrysler Automobiles NV employees had flagged the alleged use of defeat devices, or software used to mask emission levels, on the carmaker's diesel pickups and SUVs, The Wall Street Journal reported, citing a lawsuit against FCA at a Manhattan federal court. The company reportedly said it was "inappropriate to draw conclusions from isolated communications," which include internal company chat room messages and emails, and said it will defend the allegations "vigorously." Meanwhile, the company defended CEO Sergio Marchionne's rebuke of former spokesman Gualberto Ranieri in a 2015 email exchange, which was made public May 14, after Ranieri issued press releases to deny the company's use of defeat devices without any internal investigation, the Journal added.
* U.S. proxy adviser Glass Lewis & Co. urged Hyundai Motor Group shareholders to vote against the South Korean conglomerate's proposed restructuring plan, terming it "profoundly unattractive" for Hyundai Motor unit Hyundai Mobis Co. Ltd's shareholders, Reuters reported. The deal also had "questionable business logic," the firm reportedly said. Another Hyundai Mobis investor Elliott Management Corp. had previously voiced its opposition to the reorganization, up for shareholder vote May 29.
CARMAKERS
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* Porsche Automobil Holding SE posted a profit of €951 million in the first quarter ended March 31, down from the €986 million the carmaker earned in the prior-year quarter, due to a decrease in the value of its cross-holding at Volkswagen AG to €967 million from €1.01 billion a year earlier. Porsche nevertheless reiterated its forecast for the year of between €3.4 billion and €4.4 billion.
* China's Geely Automobile Holdings Ltd. would go for a public offering of Volvo Cars only at a valuation of $30 billion to $40 billion, or 10 times the Swedish carmaker's earnings, the Financial Times reported, citing Geely's discussions with banks for underwriting the IPO. The Chinese automaker, which declined to comment further, reportedly will remain Volvo Cars' largest shareholder and use the IPO proceeds to fund Volvo's electric and self-driving strategies. Further updates on the offering will be disclosed at a Volvo Cars board meeting in May, the Times reported.
* Honda Motor Co. Ltd. began making a hybrid electric vehicle Insight at its Greensburg, Ind., facility and forecast spending $61.5 million in capital investment in Indiana and Ohio to help in its EV production. The Japanese automaker's Indiana plant, which has put in $32.5 million for producing the model, will build Insight for the entire North American market. The model will reach Honda dealerships across the U.S. early in the summer of 2018, the company added.
ELECTRIC AND AUTONOMOUS VEHICLES
* Tesla Inc. CEO Elon Musk told employees that the company plans to flatten and restructure its management and is undergoing a "thorough reorganization," The Wall Street Journal reported, citing an internal company memo. Musk reportedly said in the memo that the company is going through the reorganization process to make sure Tesla is "well prepared" for the future. Under a flat organization structure, there are few or no levels of middle management between staff and executives.
* The driver involved in a Tesla Inc. Model S crash in South Jordan, Utah, had activated the U.S. electric carmaker's Autopilot driver assistance feature at the time of the accident, USA Today reported. Tesla, which has yet to release the car's computer logs, said it is helping the police in their investigation. CEO Elon Musk previously turned down a proposal to add extra precautions, like sensors that track drivers' eye movements or steering-wheel control checks, to the Autopilot system because of related costs and his belief that it would be ineffective and annoy drivers, The Wall Street Journal reported, citing people familiar with the discussions.
* Chinese internet giant Tencent Holdings Ltd got clearance to test its self-driving car on some roads in the country's Shenzhen city, Xinhua News Agency reported. The Shenzhen Transport Bureau gave a license plate to the car, which will always have a driver and safety personnel during tests, the report added.
* Toyota Motor Corp. said it will invest ¥400 million via equity in Japanese big data company ALBERT Inc. and develop jointly automated driving technology using big data analysis.
REGULATIONS AND SAFETY
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* The EU is considering a target to cut CO2 emissions from trucks by at least 30% by 2030, Reuters reported, citing an EU source. EU Commissioners reportedly will take a vote May 16 on the policy, which also allows for a credit-based incentive system for companies, to be followed up with approvals from national governments and the European Parliament.
AUTO PARTS AND EQUIPMENT
* German auto parts maker Hella GmbH & Co. KGaA is exploring strategic alternatives for its wholesale business, conducted under the Nordic Forum brand, and is in talks with certain potential investors for a structured auction process. There is no preferred buyer at the moment and Hella will take a call after the submission of final bids.
* Italian tiremaker Pirelli & C. SpA lowered its fiscal 2018 revenue sales growth outlook to equal or above 9% year over year, compared with its prior guidance of a 10% year-over-year increase, due to lower demand from its standard business segment. The company's net sales for the first quarter ended March 31 dropped to €1.31 billion from €1.34 billion in the same period in 2017.
AUTOMOTIVE RETAIL
* Volkswagen AG's commercial vehicles business registered an increase of 16.2% year over year in sales to 46,300 vehicles in April. Sales in Western Europe, which grew 22.2% year over year to 33,600 vehicles, and in South America, which increased 24.3% year over year to 3,600 units, helped growth in April.
TRUCKS AND MOTORCYCLES
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The day ahead
Early morning futures indicators pointed to a lower opening for the U.S. market.
In Asia, the Hang Seng fell 1.23% to 31,152.03, while the Nikkei 225 dropped 0.21% to 22,818.02.
In Europe, around midday, the FTSE 100 climbed 0.28% to 7,732.60, and the Euronext 100 shed 0.04% to 1,070.77.
On the macro front
The retail sales report, the Empire State Manufacturing Survey, the Redbook Index, the business inventories report, the Housing Market Index and the Treasury International Capital report are due out today.
