trending Market Intelligence /marketintelligence/en/news-insights/trending/vjht1olx0zwsryyglqb0hg2 content esgSubNav
In This List

FCA to be debt-free in June; US auto industry groups oppose Trump tariffs

Blog

Using ESG Analysis to Support a Sustainable Future

Video

S&P Capital IQ Pro | Powered by Expert Insights

Blog

Q&A: Streamlining Analytics for TCFD Reporting

Blog

Evergrande and the wider impact: a sentiment analytics based perspective


FCA to be debt-free in June; US auto industry groups oppose Trump tariffs

TOP NEWS

* Fiat Chrysler Automobiles NV is set to become debt-free as CEO Sergio Marchionne expects the automaker to report a net industrial cash position when financial books are closed in June. The company had a net debt of 10.27 billion in 2014. The company, presenting its five-year strategy, said in a series of tweets that it plans to enter three new segments under Jeep and launch 10 PHEVs and 4 BEVs under the brand, with electrification option available across each Jeep nameplate by 2021. The company also plans to offer a Jeep with Level 3 self-driving abilities. FCA's Maserati and Alfa Romeo luxury brands, reported to be combined into a single entity, will also turn fully electrified in 2022.

* U.S. industry groups representing car and auto parts makers manufacturers decried President Donald Trump's decision to impose 25% tariffs on steel imports and 10% on aluminum imports from the EU, Canada and Mexico, saying the move would likely prompt retaliation and threaten jobs. The Alliance of Automobile Manufacturers, which represents carmakers including General Motors Co., Ford Motor Co. and Volkswagen AG, said that increased prices for U.S.-made materials will be passed on to consumers, while the Motor & Equipment Manufacturers Association, which represents 1,000 U.S. auto parts makers, reportedly said their members face having to pay double tariffs on some materials. Meanwhile, Bayerische Motoren Werke AG said it may increase the amount of steel it sources locally for its South Carolina plant, Reuters reported.

CARMAKERS

* General Motors Co. shares spiked about 12.9% to close at $42.70 on May 31 after the automaker announced that SoftBank Vision Fund will invest $2.25 billion in its self-driving unit, GM Cruise Holdings LLC. As a result of the investment, SoftBank Vision Fund will hold a 19.6% equity stake in GM Cruise.

* Hyundai Motor Co. sent a letter of intent to Gwangju municipality officials in South Korea to set up a joint venture, in exchange for tax breaks, for making Hyundai-branded cars under an original equipment manufacturing contract, Yonhap News Agency reported, citing a company spokesman. Only a new model reportedly could be produced at a non-Hyundai site because a transfer of an existing production process would require the approval of its labor union.

ELECTRIC AND AUTONOMOUS VEHICLES

* New York is investing $250 million over seven years into new electric vehicle infrastructure to support electric vehicle adoption by consumers under the Evolve NY initiative, which seeks to expand public adoption of EVs as well as create private-public partnerships through 2025 to support EV growth. New York Power Authority, the largest state-owned public power utility in the U.S., will carry out the program.

* Fiat Chrysler Automobiles said it is in talks with Alphabet Inc.'s self-driving car unit Waymo LLC to license Waymo's technology in an FCA car for retail customers. The two companies also expanded their existing collaboration to deliver, starting late 2018, up to 62,000 of FCA's Chrysler Pacifica Hybrid minivans to Waymo's driverless fleet.

REGULATIONS AND SAFETY

* U.S. auto regulators recommended the White House Office of Management and Budget to do away with stringent emissions norms for automakers after 2020 and bar California from making stricter emissions standards than those mandated by the federal government, Reuters reported, citing two sources. The proposal by the U.S. Environmental Protection Agency and the National Highway Traffic Safety Administration will be up for a public review as early as the week of June 4.

* The EU said it would take the U.S. to the World Trade Organization to settle a row over steel and aluminum tariffs and vowed to retaliate with additional duties on American imports. Meanwhile, Canadian Prime Minister Justin Trudeau and Canadian Minister of Foreign Affairs Chrystia Freeland said the country will impose tariffs on products worth C$16.6 billion as retaliation to the "absurd" and "inconceivable" U.S. move to impose tariffs on steel and aluminum from Canada, Mexico and the EU.

AUTO PARTS AND EQUIPMENT

* Toyota Motor Corp. and auto parts maker Denso Corp. started discussions on merging the two Japanese companies' core electronic component operations under Denso, in response to growing electrification, automated driving and connectivity in the industry. Initial discussions will focus on shifting electronic components manufacturing from Toyota's Hirose plant to Denso tentatively by the end of 2019, with a view to integrate the processes fully under Denso from 2022.

* Bridgestone Corp.-owned unit Bridgestone HosePower LLC bought New Jersey-based hydraulic and industrial hose company Industrial Rubber Co. for an undisclosed sum to expand its footprint in the Northeast U.S. All 17 Industrial Rubber employees will join the tiremaker's unit, which now has 44 locations in the U.S. and one in Mexico, the company said.

AUTOMOTIVE RETAIL

* JD.com Inc. partnered with auto parts makers Gates Automotive Corp., Tenneco Inc., Continental Aktiengesellschaft and KYB Corp. to stock the Chinese e-commerce giant's Jingchehui automotive portal with over 5,000 items, Gasgoo reported. The companies reportedly will further cooperate in supply chain, technology, logistics and authorized terminal store domains, among others.

Now featured on S&P Global Market Intelligence

Tariff extension will impact about 30% of seaborne US steel, aluminum imports

The day ahead

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

In Asia, the Hang Seng increased 0.08% to 30,492.91, while the Nikkei 225 decreased 0.14% to 22,171.35.

In Europe, around midday, the FTSE 100 was up 0.71% to 7,732.26, and the Euronext 100 was up 1.14% to 1,060.98.

On the macro front

The motor vehicles sales report, the employment situation report, the PMI Manufacturing Index, the ISM Manufacturing Index, the construction spending report and the Baker-Hughes Rig Count report are due out today.

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.