* Strong SUV demand drove up U.S. retail sales of Fiat Chrysler Automobiles NV and Ford Motor Co. in August, while Toyota Motor Corp. sales dropped. FCA's new vehicle sales rose 10% year over year to 193,718 vehicles, led by its Jeep and Ram brands, while Ford's sales rose 4.1% to 218,504 vehicles, with its SUVs up 21%. However, General Motors Co. reportedly saw a 13% drop in U.S. sales, and Toyota's total vehicle sales slid 2% to 223,055 units. Nissan Motor Co. Ltd.'s U.S. sales rose 3.7% to 112,376 units, while Honda Motor Co. Ltd.'s total car sales in the country grew 1.3%. Hyundai Motor Co. posted a 6% increase at 56,929 vehicles.
* Daimler AG-owned Mercedes-Benz unveiled a battery-powered sports utility vehicle designed from scratch with an electric-only powertrain — the first of about 10 plug-in cars the automaker hopes to add to its product lineup by 2022. The SUV is due to go on sale in Germany in early 2019, with a gradual rollout across Europe and in China, where an existing Mercedes-Benz plant in Beijing will also build the car. The EQC will then be launched in the U.S. in 2020. Pricing has yet to be confirmed, though as a premium brand, it is likely to compete for customers with Tesla Inc.'s SUV, the Model X, which costs about $80,000. Thus, Daimler will become one of the first mainstream car makers to encroach on the U.S. carmaker’s virtual monopoly in high-end battery SUVs.
* Toyota Motor said it will recall about 192,000 Prius hybrid vehicles in the U.S. of model year 2016-2018 and 791 in Australia made from November 2015 to May 2018, to correct an engine wire harness issue that could cause an electrical short circuit. Globally, the recall number totals 1.03 million Prius and C-HR compact crossover vehicles, including 554,000 units in the automaker's domestic market of Japan, Bloomberg News reported, citing company spokesman Jean-Yves Jault. No injuries occurred due to the defect so far, although there was one incident of a vehicle emitting smoke, the spokesman said.
* Peugeot SA and its Opel unit informed works council about plans to discuss a potential strategic partnership with engineering service provider Segula Technologies for Opel's plant in Russelsheim, Germany. Segula intends to take over the plant's vehicle and propulsion engineering facilities, along with up to 2,000 employees, and expand the plant's expertise beyond automotive to the rail and energy industries. Segula also is willing to guarantee protection against dismissal agreed until July 2023. Opel CEO Michael Lohscheller, who previously said the company could evaluate strategic partnerships to drive profitability at the site, said "a heavily decreasing workload from external parties" necessitated the restructuring.
* Volkswagen AG's sports car unit Porsche AG said it is investing "tens of millions" in a 50-50 joint venture with German automotive press systems company Schuler A.G. to build a smart press shop capable of producing complex body parts, with a focus on aluminum outer skin panels and smaller batch sizes. The new company, which will create more than 100 new jobs, will help Porsche toward its next-generation sports car strategy.
* China's Great Wall Motor Co. Ltd. will invest 500 million Chinese yuan into a plant in Tula, Russia, the automaker's largest overseas project, to make its Haval brand of vehicles, Gasgoo reported. The company reportedly expects Haval F7, unveiled Aug. 29 at the Moscow International Auto Show, to be exported to South America and Europe besides selling it in China and Russia. Great Wall Motor aims to operationalize the plant in the first quarter of 2019, Gasgoo reported.
ELECTRIC AND AUTONOMOUS VEHICLES
* Goldman Sachs resumed coverage of Tesla Inc. with a sell rating and gave a $210 six-month price target for the company's shares. Goldman Sachs analyst David Tamberrino said in a research note that he believes Tesla will see "pressure to its lead in [electric vehicles] as competition catches up." Tamberrino sees the medium- to longer-term industry backdrop as "challenging" for Tesla's products. "Altogether, we remain bearish on the company's ability to execute, achieve its targeted production ramp/margins, and sustain [free cash flow] generation," the analyst wrote.
* Fiat Chrysler Automobiles is investing $30 million to develop a new autonomous driving test facility at the carmaker's Chelsea Proving Grounds site, The Detroit News reported. The facility, comprising a dedicated autonomous highway-speed track, a 35-acre safety-feature evaluation area and a 6,500-square-foot command center, will begin testing FCA cars in September, company spokeswoman Dianna Gutierrez reportedly said. FCA CEO Mike Manley said the investment "will help support and enable the successful rollout of the company's five-year plan," the newspaper reported.
* The U.S. National Transportation Safety Board, which is investigating a June 15 Tesla Inc. Model S fire incident, released a preliminary report on the probe. The NTSB said it will use information from this and other investigations "to address safety issues encountered by first responders and others during crash scene stabilization and vehicle recovery operations involving electric-powered vehicles," adding that "all aspects of the incident remain under investigation."
REGULATIONS AND SAFETY
* Canadian Prime Minister Justin Trudeau said the country would not compromise on key demands when the U.S. and Canada resume talks Sept. 5 to update the North American Free Trade Agreement, Reuters reported. "There are a number of things we absolutely must see in a renegotiated NAFTA," Trudeau said. "No NAFTA is better than a bad NAFTA deal for Canadians, and that's what we are going to stay with." U.S. President Donald Trump recently threatened to exclude Canada from NAFTA if it failed to reach a "fair deal for the U.S."
AUTO PARTS AND EQUIPMENT
* Jan Carlson, chairman of parts-maker Autoliv Inc. and president and CEO of its spun-off electronics unit Veoneer Inc., bought on Aug. 30 Swedish depository receipts representing 50,000 shares of Veoneer's common stock and sold on Aug. 31 42,589 common shares of Autoliv to rebalance his investment portfolio in line with his new executive roles. Carlson now owns 71,727 Autoliv shares and remains its long-term shareholder, the company said.
* JD.com Inc. updated the business scope of the Chinese e-commerce giant's logistics unit, Jiangsu Jingdong Information Technology Co. Ltd., to cover ride-hailing services like online taxi booking, auto parts sales and public transportation services, Gasgoo reported, citing local Chinese media. JD.com reportedly seeks to mirror Didi Chuxing Technology Co. Ltd.'s operational model to develop a ride-hailing freight platform in the country.
* New car registrations in the U.K. grew 23.1% year over year in August to 94,094 units on higher demand across all industry segments and in response to regulatory changes, according to figures released by trade body The Society of Motor Manufacturers and Traders. Hybrids and plug-in car registrations surged 88.7% year over year to 7,489 units as a record 1-in-12 customers bought an alternatively fueled vehicle in the month.
* Prior to the rollout in September of the Worldwide harmonized Light vehicle Test Procedure, or WLTP, emissions standards, Volkswagen Group's new passenger car registrations in Germany rose by 46.2% year over year in August to offset partially the upcoming dent in its monthly sales, Reuters reported, citing statistics from the KBA German vehicle watchdog. The move led to August car registrations in the country rising 24.7% year over year to 316,405 vehicles even though only 32.6% of that reportedly came from private owners.
* European carmakers reported mixed U.S. sales results in August. Volkswagen Group's namesake brand recorded a 0.7% year over year rise in sales at 32,255 units, while its luxury car unit Audi saw a growth of 5.5% to 20,907. VW's luxury car unit Porsche AG's North America unit posted a 13% decline in August sales at 4,083 vehicles. Mercedes-Benz's U.S. unit reported August sales of 20,339 models, a decrease of 19.8% from August 2017, due to delay in restocking inventory of 2019 models, while Bayerische Motoren Werke AG recorded an increase of 1% in August sales to 23,789 units, helped by its X models.
The day ahead
Early morning futures indicators pointed to a lower opening for the U.S. market.
In Asia, the Hang Seng fell 2.61% to 27,243.85, while the Nikkei 225 fell 0.51% to 22,580.83.
In Europe, around midday, the FTSE 100 decreased 0.45% to 7,424.68, and the Euronext 100 fell 0.84% to 1,039.01.
On the macro front
The MBA mortgage applications report, the international trade report and the Redbook 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.
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