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Daily Archives: February 13, 2020

Jaguar I-Pace Production Hits a Roadblock

2020 jaguar i-pace

The production of the Jaguar I-Pace electric sport utility vehicle will be temporarily halted. Jaguar Land Rover paused the assembly of the electric vehicle for a week because of supply issues with LG Chem.

According to The Times, the temporary halt in the I-Pace assembly line was caused by the LG Chem battery factory in Poland. Jaguar didn’t elaborate more on the matter.

Magna Steyr, the contract manufacturer of Jaguar for I-Pace, will stop its operations in the meanwhile as the issue is being resolved. The pause in production in the company’s Graz, Austria plant will take effect this coming February 17.

It would be the fourth time for LG Chem to be involved in the delay of an EV production. Companies like Hyundai, Audi, and Mercedes-Benz earlier hit a snag in their electric cars due to LG Chem’s failure to meet up with its commitments in supplying batteries to the said automakers. It should be noted that Mercedes’ parent, Daimler, retracted on this claim though.

On the other hand, Sam Jaffe, the managing director of Cairn Energy Research Advisors, doubts that the issue is mainly battery shortage. In his email to The Verge, he claimed that Jaguar may only be avoiding an all-too-successful EV launch. Such a scenario would potentially cannibalize the brand’s pre-existing model sales and anger its dealers. On the other end of the spectrum, it may only be the cause of a bad strategy. He finds it strange too that Jaguar, as well as Audi and Daimler, failed to sign binding contracts with battery suppliers in advance just like what Volkswagen did when it inked deals with three different suppliers to ensure that its EV’s battery demands will be met.

Jaffe also pointed out that Jaguar only sold 18,000 units of the I-Pace in 2019 during its initial run. Therefore, it is hard to imagine that the brand is experiencing problems in getting enough batteries for it.

Volvo and Geely Begin Talks for a Full Merger

geely and volvo

Geely is now looking to make a full merger with Volvo. If such plans come into fruition, it would expand the reach of the Chinese automaker in the global market.

Geely bought 99% of Volvo from Ford in 2010 for $1.8 billion in the aftermath of the financial crisis. That’s a lot lower than what the American brand spent to purchase the Swedish brand in 1999, which sums up to $6.45 billion. After the acquisition, Geely kept Volvo as a distinct brand for product diversification purposes.

Fast-forward to the present, Geely is now considering a full-merger with Volvo to save on production costs, expenditures on components as well as resources in research and development. The move could also help the Chinese brand achieve more reach worldwide.

In the past, Geely focused mainly on its home market in China. The country remains the largest market for automotive sales even though it experienced a decline last year. The merger with Volvo will let the brand make up for its dwindling sales in the troubled domestic market by getting a wider network in car exports to other major markets like Europe and the US.

Under the ownership of Geely, Volvo was able to increase its sales by 10% in 2019 compared to the prior year. The company sold a total of 705,000 vehicles within that period.

The merger is expected to bring in more funds from foreign investors too because the combined Geely-Volvo shares will be listed in both Hong Kong and Stockholm.

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