Today on The Morning Dump, we’ve got bad Q3 reports, a novel Ford approach to firing people, and mobility.
Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday.
Is VW Still A Mobility Company?
Every company is a technology company. And every company that isn’t a technology company is a mobility company, which is like a technology company but ::waves hands:: cars.
Volkswagen just joined Ford in bailing on self-driving company Argo to instead focus on a partnership with MobilEye. Now Volkswagen has announced it’s “selling” its in-house EV car-sharing business UMI Urban Mobility International GmbH to MILES Mobility to MILES mobility, another German-based company.
From VW’s press release:
“New mobility services such as car subscription models and car sharing are enjoying strong demand. This is a trend in which we would like to participate more. With a strong partner to operate the fleet and with vehicles from various Volkswagen Group brands, car sharing will become available to an even broader spectrum of customers. We are pleased to have found the perfect partner in MILES, whose portfolio will be bookable via the Volkswagen mobility platform. WeShare customers will then benefit from car sharing services in eight German cities,” says Dr. Christian Dahlheim, Chairman of the Board of Volkswagen Financial Services AG, which holds consolidated responsibility for the Volkswagen Group’s core activities in the field of mobility solutions.
Sure. As part of the deal MILES has ordered 10,000 electric cars from VW/Seat/Cupra/Audi.
[Editor’s Note: A few years ago, Porsche invited me to Germany to show off the new headquarters of “Porsche Digital,” an entirely new subsidiary within the company dedicated to…digitalization — whatever the hell that is. You’d think, of all people, I’d know given that I got a tour of the headquarters and a thorough explanation of Porsche Digital’s mission, which — per the subsidiary’s website — is:
Digitization is disrupting entire industries, including the automotive sector. Porsche sees these changes as opportunities that should be explored and utilized.
That is why Porsche Digital was founded in 2016.
We aim to find and scale new digital business models as well as optimizing existing products. Therefore, we develop digital products and services, create technologically advanced business solutions, and serve as a catalyst for the digital ecosystem.
Right. Anyway, that was a bit of an aside, but the point is that car companies have been diversifying for a long time, buying rental car companies, private jet companies, and much more. It’s trendy. The hot new thing has been automakers calling themselves “mobility companies,” in part due to investments in self-driving car tech and in rideshare companies. It’s no surprise that we’d eventually see some “mobility” investments get moved around. -DT]
Toyota Cuts Forecasts, Blames Chips
Toyota’s profits are down 25% in Q3 relative to 2021, which is worse than expectations, and they’re blaming the chips!
Per Reuters via Yahoo!:
“We’re out of the worst phase, but … it’s not necessarily a situation where we’re fully supplied,” said Kazunari Kumakura, Toyota’s purchasing group chief. “I don’t know when the chip shortage will be resolved.”
Operating profit for the three months ended September fell to 562.7 billion yen ($3.79 billion), well short of an average estimate of 772.2 billion yen in a poll of 12 analysts by Refinitiv. Toyota sales reported a 749.9 billion yen profit a year earlier, and 578.6 billion yen in profit in the first quarter.
“I don’t know when the chip shortage will be resolved.”
That’s a rough answer when your job is buying things to make things.
There is an argument to be made that much of what is driving inflation is not government spending or even supply chain disruptions, but corporate profits. It’s probably a mix of multiple factors, but it’ll be interesting to see if costs drop relative to inflation when the chip shortages and all the other disruptions melt away.
I’m putting a marker down to track it, though. The starting MSRP for a Toyota Highlander is: $36,420. Let’s check in on that number from time-to-time.
Skoda Made Some Money, Though Slightly Less Than Last Year
There are a lot of morning shifts/dumps/roundups/wrapups, but there are none as committed to bringing you the important Skoda news as this one. And I’m gonna level with you. I’m not gonna sugarcoat it. In spite of a truly wonderful suite of products from the Czech brand, it did take a little hit this quarter.
The company is calling its returns “stable” with $850 million profit through the first three quarters of the year, which is off 4.9% from the same period in 2022. This is as deliveries fell 22.3% year-over-year due to chips, supplies, and the war in Ukraine.
They’re profitable, though. They’re still making a profit. Let’s not lose sight of that. It’s tough times in Central Europe. Did I mention the war?
Yet, somehow, these hard-working people are still making Superbs for you (though, honestly, not many of you) to enjoy. Look at that thing above; doesn’t it look great? One might even say it looks…[Editor’s Note: Sorry, joke was too bad. Had to remove it. -DT].
Ford Offers Severance To Low-Performing Employees
Most modern corporations have what’s called a “Performance Enhancement Plan” to get employees who are underperforming back on track. In some cases it exists to provide support to some people who, simply, need a little attention. In other cases it’s a way a corporation can create a paper trail to try and cut-off a wrongful termination suit.
Rather than deal with all the tsuris, Ford is trying to shortcut the process by offering employees a PEP or just severance. As The Detroit News reports:
The updated policy now allows employees who have reached that point of intervention to leave the company with severance payouts based on length of employment, continuation of benefits and career transition services. The process would remain unchanged for those who opt to go through a PEP rather than leave — meaning they could be subject to termination, without severance, if they ultimately fail to turn around their performance.
I could see situations where this could be abused (the inherent threat that you could be fired anyway might force people into taking the money) but, for situations where the employment is a bad fit, it seems like a softer departure.
The Flush
Define: “Mobility.”
Photo credits: Volkswagen, Toyota, Apple, Skoda