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FCA US sales grew 11% in May; Nissan may scrap diesel engines development

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FCA US sales grew 11% in May; Nissan may scrap diesel engines development

TOP NEWS

* Fiat Chrysler Automobiles NV and Ford Motor Co. reported sales in the U.S. climbed year over year in May, while Japanese carmakers posted declines to May 2017. FCA said sales rose 11% to 214,294 vehicles. Ford sales totaled 242,824 vehicles, an increase of nearly 1%. General Motors Co. has stopped issuing monthly sales numbers. Toyota Motor Corp. reported sales reversed 1.3% to 215,321 vehicles, while Nissan Motor Co. Ltd.'s sales skidded 4% to 131,832, even though it sold 1,576 LEAF all-electric vehicles, a 13% increase. Honda Motor Co. Ltd.'s U.S. unit reported a 2.7% decline in sales to 73,261 vehicles. Overall Honda sales grew 3.1% due to a 9.2% surge in trucks sales at 79,808 vehicles.

* Nissan plans to end the development of diesel engines to redirect resources to electric vehicles after concluding that further decline in the diesel engine market is inevitable, the Nikkei Asian Review reported. The decision comes amid countries considering stricter environmental regulations on vehicle emissions.

CARMAKERS

* Volkswagen AG's Porsche unit said it would temporarily limit the number of models it sells in Europe, citing a switch in European emission tests, Reuters reported. Worldwide Harmonised Light Vehicle Test Procedure, or WLTP, is being introduced across Europe to extend testing to check for pollutants like ultrafine particles emitted from a new generation of gasoline direct injection engines, according to the report.

ELECTRIC AND AUTONOMOUS VEHICLES

* Fiat Chrysler Automobiles NV said it will invest €9 billion in electrification as it seeks to double operating profit by 2022 and that it plans to launch a financial services company in the U.S.

* Hyundai Motor Co. is considering investment in contract manufacturing as it seeks ways to cut costs and pump funds into the development of new technologies such as electric vehicles, Reuters reported. The South Korean carmaker conducted due diligence on a contract car manufacturing plant site proposed by the city of Gwangju, China.

* The U.K. government is investing $33 million in as many as six projects involving research and testing of autonomous vehicles on highways and on remote-control parking, Bloomberg News reported.

REGULATIONS AND SAFETY

* The German government said it had agreed with Daimler AG to take concrete steps to clear issues related to diesel emissions, Reuters reported, citing a spokesman for the transport ministry. This follows a report in Germany's Der Spiegel magazine that Transport Minister Andreas Scheuer threatened to fine Daimler nearly $4.4 billion over a diesel emissions scandal.

* Kia Motors Corp. is recalling 106,428 Sedona minivans due to faulty sliding doors software, The Associated Press reported, citing documents filed at the National Highway Traffic Safety Administration. Kia reported receiving 21 complaints, 14 of which alleged injuries, caused by the glitch in 2015-18 models. Additionally, General Motors is recalling 88,129 year 2018 GMC Terrain SUVs over concerns that their airbags may not deploy in a crash due to a faulty sensor, according to the report.

AUTOMOTIVE RETAIL

* Volkswagen AG sold 31,211 vehicles in the U.S. in May, up 4% from May 2017. Its luxury car unit, Audi AG, sold 19,315 vehicles, a 0.6% rise. Daimler AG-owned Mercedes-Benz reported sales increased 0.3% to 26,976 vehicles, while sales of rival Bayerische Motoren Werke AG, or BMW Group, added 3.4% to 30,888 vehicles.

* Maruti Suzuki India Ltd said sales in May grew 26.0% to 172,512 vehicles, up from 136,962 in the same month in 2017. Domestic sales rose 24.9% to 163,200 vehicles, while exports accelerated 48.1% to 9,312 from 6,286.

TRUCKS AND MOTORCYCLES

* Harley-Davidson Inc. said the European Union's decision to impose retaliatory tariffs on U.S. imports will have "significant impact" on its sales, Reuters reported. According to Panjiva, U.S. motorcycle exports to the EU in the 12 months to March 31 were worth $546 million. Chris Rogers, research director for Panjiva, noted that consumer could struggle to find alternatives to Harley-Davidson motorcycles.

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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 was up 1.66% to 30,997.98. The Nikkei 225 rose 1.37% to 22,475.90. In Europe, as of midday, the FTSE 100 was up 0.31% to 7,701.77, and the Euronext 100 climbed 1.02% to 1,059.77.

On the macro front

The factory orders report is due out today.

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