TOP NEWS

* The European Union is considering talks with major auto exporters like the U.S., South Korea and Japan to mutually cut tariffs in a bid to stave off U.S. President Donald Trump's proposed auto import duties, the Financial Times reported, citing three diplomats briefed on the initiative. Richard Grenell, the U.S. ambassador to Germany, told Daimler AG, Volkswagen AG, and BMW Group executives in a meeting that Trump would not impose auto tariffs if the EU lifted duties on U.S. cars, Reuters reported, citing German newspaper Handelsblatt. More than 40 World Trade Organization members including the 28 EU countries, China and Japan, expressed concern in a July 3 meeting over the potential U.S. tariffs, Reuters reported.

* Jaguar Land Rover Automotive PLC CEO Ralf Speth called on the U.K. government to "provide certainty" for businesses on the proposed post-Brexit trading relationship with the European Union, saying a "bad Brexit" would cost the British luxury-car maker £1.2 billion a year. Speth added that such an event would "jeopardize" the company's plan to invest £80 billion in the country over the next five years. JLR parent Tata Motors Ltd.'s stock hit a 5-year-low of 261.50 Indian rupees on the Bombay Stock Exchange after the profit warning.

CARMAKERS

* Nissan Motor Co. Ltd. and Renault SA are exploring possible strategic options, including a merger or the formation of a holding company, before the alliance's chairman, Carlos Ghosn, steps down in 2022, Bloomberg News reported, citing people familiar with the matter. Jonathan Adashek, a spokesman for the alliance that also includes Mitsubishi Motors Corp., reportedly said the companies are "continually reviewing options" without giving any timeline.

* Opel's works council demanded that the management of the Peugeot SA-owned unit clarify, at a town hall due July 5, reports about a potential sale of Opel's research and development center based in Rüsselsheim, Germany, Automotive News Europe reported. Opel CEO Michael Lohscheller said in a release that the company is "looking into different options," including strategic partnerships with other companies, in a bid to achieve profitability. No decisions to this effect have been made, Lohscheller said, reiterating that "all future Opel models will be developed" at the site.

ELECTRIC AND AUTONOMOUS VEHICLES

* Volkswagen AG said it will roll out a fleet of electric vehicles to be used for vehicle-on-demand services, particularly car-sharing, in Germany in 2019. The services will be carried out through a customer platform called "WE," according to the release. After the initial launch in Germany, the carmaker plans to expand the service to major cities in Europe, North America and Asia in 2020.

* France's Renault SA and Peugeot SA announced plans to launch electric-car-sharing initiatives in Paris in 2018, following the collapse of the long-established Autolib' service that will close down in July. Renault said that it plans to deploy 2,000 cars by late 2019, a mix of its wholly electric Twizy two-seater, Zoe hatchback, Kangoo and Master vans, while PSA will roll out an initial 500 Peugeot and Citroen electrics in the final quarter of 2018.

* Tesla Inc. did not conduct a critical brake and roll test on some of its Model 3 units prior to their release from the company's Fremont, Calif., plant, Business Insider reported, citing an internal document. Tesla CEO Elon Musk reportedly ordered a stop to the test, which checks a new car's alignment, before 3 a.m. on June 26, according to a person familiar with the matter. Tesla drives "every Model 3" on its "test track to verify braking, torque, squeal and rattle" without exceptions, company spokesperson Dave Arnold told Business Insider.

REGULATIONS AND SAFETY

* Singapore's competition regulator, in its provisional findings, concluded that a Grab and Uber Technologies merger in the region substantially lessened competition and that the two ride-hailing companies may have to cancel the merger. The Competition and Consumer Commission of Singapore suggested remedial steps, launched a public consultation on the viability of the merger and proposed fines on the two companies, saying that they pursued merger despite knowledge of potential competition concerns.

* A U.K.-based auto trade group urged the British government to back new-tech diesel as the country's new car market declined 3.5% year over year to 234,945 registrations in June. The Society of Motor Manufacturers and Traders said that diesel demand declined 28.2% year over year due to "consumer uncertainty over future policy towards this technology." The alternatively fueled vehicle sector saw a 45% year-over-year increase in plug-in and hybrid registrations, while petrol car demand grew 12.3% year over year.

* Officials from the Seoul Central District Prosecutors' Office raided Hyundai Motor Co. headquarters on suspicion that the South Korean carmaker hired retired senior Fair Trade Commission officials, The Korea Times reported. As per the country's law, government officials are barred legally from working at entities related to their former work for three years after their retirement.

AUTO PARTS AND EQUIPMENT

* French auto parts maker Valeo SA said it has entered into a strategic partnership with Apollo, the autonomous driving platform created by Chinese search engine giant Baidu Inc. Valeo will contribute its expertise in sensors — such as cameras, radars, ultrasonic sensors and its own Scala laser scanner — to Baidu's autonomous driving ecosystem, while gaining from Baidu's range of software, hardware and data tools.

* OSRAM Licht AG and Continental Aktiengesellschaft said they have completed negotiations and approval procedures for their 50-50 joint venture OSRAM Continental GmbH. OSRAM Continental products are expected to be ready for series production by 2021.

* Hyundai Motor Group's auto parts unit Hyundai Mobis Co. Ltd forecasts spending 10% of its core sales revenue, which amounts to 10 trillion South Korean won a year, in research and development by 2021, up 7% from present levels, Yonhap News Agency reported.

AUTOMOTIVE RETAIL

* Top carmakers reported a year-over-year growth in U.S. sales in June. Ford Motor Co. sold 230,635 vehicles in the month, up 1.2% year over year, while Toyota Motor Corp.'s North American unit sold 209,602 vehicles in the country, up 3.6% from June 2017. A total of 202,264 vehicles from Fiat Chrysler Automobiles NV's FCA US LLC were sold in June, up 8% from the same month a year earlier. General Motors Co., which discontinued issuing monthly U.S. sales reports in favor of quarterly figures, sold 758,376 vehicles in the second quarter, a 4.6% increase year over year amid a strong demand for crossovers and trucks.

* Auto sales in Canada fell 1.6% year over year in June, the fourth consecutive month of decrease, hurt by an 8% monthly dip in passenger car sales to 61,153 units, Reuters reported, citing information released by market research firm DesRosiers Automotive Consultants. Light trucks sales in the country were up 1.4% year over year to 139,003 vehicles, comprising about 69% of overall sales, Reuters reported.

* Swedish carmaker Volvo Cars launched a new app-based mobility service company called M to provide on-demand access to cars and services to customers. The Geely Automobile Holdings Ltd. unit plans to debut M in Stockholm, Sweden and the U.S. in the spring of 2019. Volvo also will integrate its car-sharing service Sunfleet with M in 2019.

* Hyundai Motor Co. forged a partnership with Australian ride-sharing startup Car Next Door Australia Pty. Ltd. to enable Hyundai car owners to rent out their vehicles in Australia, Yonhap News Agency reported. The app-based Hyundai auto link service will initially be available for the South Korean carmaker's i30 hatchback and the Kona subcompact SUV, and thereafter reportedly to the Santa Fe SUV and Ioniq product line.

TRUCKS AND MOTORCYCLES

* U.S. President Donald Trump tweeted that the government "is working with other Motor Cycle companies" keen to set up operations in the country following Harley-Davidson Inc.'s move to shift some of its production for European customers out of the U.S.

The day ahead

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

In Asia, the Hang Seng was down 0.21% to 28,182.09. The Nikkei 225 declined 0.78% to 21,546.99.

In Europe, as of midday, the FTSE 100 added 0.60% to 7,618.39, and the Euronext 100 was up 0.94% to 1,053.54.

On the macro front

The Challenger job-cut report, the ADP employment report, the jobless claims report, the ISM non-manufacturing index, and the EIA petroleum status report are due out today.

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