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China approves tougher auto investment rules; EU sets 'challenging' CO2 target


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China approves tougher auto investment rules; EU sets 'challenging' CO2 target


* China will "explicitly" bar the creation of new, independent enterprises that make only combustion engines as it looks to "strictly control" investments in the auto industry as well as the addition of new manufacturing capacity, Reuters reported, citing Chinese state planner National Development and Reform Commission. The move reportedly is seen as the government's efforts to bring about consolidation in the Chinese automotive industry amid sluggish growth while boosting sales of new energy vehicles.

* The EU agreed to cut CO2 emissions from cars by 37.5% by 2030, higher than the initial target of a 35% reduction set by the member states' environment ministers Oct. 9. The regulations, which also include decreasing emissions from vans by 31%, were called "highly challenging" and "driven purely by political motives, without taking technological and socio-economic realities into account" by the European auto industry body. The European Council still needs to approve the measures that also will be voted upon in the plenary of the European Parliament.


* Nissan Motor Co. Ltd. CEO Hiroto Saikawa turned down Renault SA's call for an extraordinary shareholder meeting, saying Nissan would take several months to improve corporate governance, The Wall Street Journal reported. Saikawa is reportedly set to meet Renault deputy CEO Thierry Bollore at an Alliance meeting due to start Dec. 18 in Amsterdam, Reuters reported, citing unnamed sources. Separately, The Japan News reported that arrested former Nissan chairman Carlos Ghosn's pay, including one part titled "postponed remuneration" not mentioned in Nissan's securities filings, was marked as "fixed remuneration" in memorandums bearing Ghosn's signatures.

* Nissan appointed its Latin America chairman, Jose Valls, as Nissan North America vice chairman, effective Jan. 2, 2019. Valls, who will continue to head Latin America operations until a replacement is named, will be in charge of Nissan's sales and marketing in the U.S. in his new role.

* Korea Development Bank said it will rescind its legal action against General Motors Co.'s local unit over GM Korea's proposed research and development unit spinoff after the carmaker committed to provide work to the new unit over the next 10 years, Yonhap News Agency reported, citing the state-run bank's governor Lee Dong-gull. GM Korea's second-largest shareholder reportedly changed its stance after the unit shared details of the divestiture with the bank.

* Peugeot SA and Italian racing company Ferrari NV were the only two European auto stocks to withstand volatile market conditions caused by the U.S.-China trade dispute, Bloomberg News reported, citing the Stoxx 600 Automobiles & Parts index. Peugeot is the lead gainer on the European auto index at 2018-ending, compared with a reportedly 26% slump of the overall index.

* Geely Automobile Holdings Ltd. received governmental clearance for building a 150,000-units-a-year passenger vehicle facility in the Chinese city of Wuhan, with construction due to start early 2019 and completed by the end of 2021, Gasgoo reported. The site has a registered capital of 2.86 billion Chinese yuan and the automaker reportedly will chip in 2.03 billion yuan, or 71.06%, of the registered capital.


* Palo Alto, Calif.-based startup Luminar, a developer of autonomous car sensing technology LiDAR, announced a collaboration with Autonomous Intelligent Driving GmbH, or AID, a unit of Volkswagen AG's Audi AG, to supply forward-facing high fidelity and long-range LiDAR technology to AID as part of its fully autonomous vehicle deployments in 2021.

* Bristol, U.K.-based chipmaker Graphcore Ltd. said it secured $200 million in funding from investors such as Bayerische Motoren Werke AG and Microsoft Corp., valuing the company at $1.7 billion. Tobias Jahn, principal at BMW i Ventures, said Graphcore's intelligent processing unit could find use in intelligent voice assistants and self-driving vehicles.

* Automotive parts supplier Aptiv PLC opened a 130,000-square-foot technical center in Las Vegas, the fourth after similar facilities in Boston, Singapore and Pittsburgh.


* A study of London's nitrogen oxide and CO2 vehicle emissions found Euro 5 black cabs to be producing at least 50% more NOx compared with the Euro 3 or Euro 4 models and up to 30 times the level of personal petrol cars of the same age, while Euro 5 and 6 diesel passenger vehicles were found to emit six times more NOx than equivalent petrol cars. The average NOx emissions by bus fleets, however, fell by 65% in the past five years, the report by International Council on Clean Transportation found.

* Hyundai Motor Co. and affiliate Kia Motors Corp. were hit by a class-action lawsuit Dec. 14 over an alleged defect that could cause vehicle fires, Bloomberg News reported. According to the lawsuit, the U.S. National Highway Traffic Safety Administration received over 350 consumer complaints related to noncollision fires as a result of the South Korean carmakers' "concealment of the defect."


* South Korea announced a 3.5 trillion South Korean won, or $3.1 billion, stimulus to the country's auto-parts suppliers to help them survive slowing vehicles sales and the industry's transition to electric cars, Reuters reported. The government plans to initiate a new credit guarantee program for bonds worth about 1 trillion won issued by auto-parts suppliers, and extend by a year the maturity of loans worth $1 billion made to domestic suppliers of General Motors' local unit, the report added.


* Toyota Motor Corp. and GrabTaxi Holdings Pte. Ltd. revealed Total-care Service, which is aimed to improve cost and efficiency of operating a ride-hailing service. The service, which will be first introduced in Singapore, will offer fleet management, auto insurance and vehicle maintenance packages. Following the initial introduction, the Japanese carmaker's marketing arm, Toyota Motor Asia Pacific Pte. Ltd., and Grab will offer Total-care Service across Southeast Asia.

* SoftBank Corp.-backed Indian ride-hailing firm OLA Fleet Technologies Pvt. Ltd. said it will invest $100 million in local scooter-sharing provider Vogo for 100,000 scooters. Vogo, which operates point-to-point dockless scooters in the Indian cities of Bengaluru and Hyderabad, also will offer its services on the Ola app soon.

* U.S. automotive retailer AutoNation Inc. elected Rick Burdick as lead independent director after Michael Larson stepped down from the company's board, effective Dec. 17.

* Peugeot SA's financing arm piloted a monthly car subscription program with London-based online car hiring platform Drover Ltd. that allows customers to choose from the French carmaker's Citroen, DS and Peugeot models online and take home deliveries, AutomotiveManagement magazine reported.

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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 fell 1.05% to 25,814.25, and the Nikkei 225 dropped 1.82% to 21,115.45.

In Europe as of midday, the FTSE was down 0.39% to 6,746.86, and the Euronext 100 fell 0.30% to 929.32.

On the macro front

The housing starts report and the Redbook index for retail sales 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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