Auto Industry News: Coronavirus Hits Global Auto Industry, Autonomous Cars Hit American Streets, and New Vehicle Debuts Hit Chicago Auto Show

It’s been a weird few weeks for the auto industry, as those in the biz leverage excitement for Chicago Auto Show debuts against anxiety surrounding the coronavirus. Autonomous cars hit American streets in several states—for both product and people delivery. And news emerges of two new mergers in the industry, this time among some big aftermarket names.

Coronavirus Hits the Global Auto Industry

China’s extended Lunar New Year holiday, intended to slow the spread of the coronavirus, has come to an end. But despite some brave souls returning to work, a large number of factories and companies remain closed, awaiting government permission to resume operations. And, unfortunately, as manufacturing comes to a screeching halt in China, supply chains around the world are feeling the strain—including the automotive industry.

Fear surrounding the coronavirus outbreak is “damaging consumer confidence, delaying purchasing, and impacting China’s consumer economy which accounts for more than half of the country’s gross domestic product,” said LMC Automotive in a statement. If the epidemic continues into the second quarter, the Chinese auto industry could see a 3-5% drop in sales and production this year, with China’s GDP growth rate dropping toward 5%, according to LMC. Alarming numbers for a car market that is experiencing its second straight year of dipping numbers.

Anxiety Spreads Faster Than Coronavirus

The virus, which has been traced back to a seafood market in Wuhan, and is responsible for more than 900 deaths as of Sunday, has already made several automakers and parts suppliers adjust or suspend production in the region. And with cases now reported in over 25 countries, OEMs outside China are taking precautionary measures as well. Reuters reports that both Hyundai and Nissan have temporarily halted assembly lines in their respective home countries of South Korea and Japan.

With the modern-day automotive industry so globally interwoven (and particularly dependent on imports from China), there’s no doubt that the epidemic will be felt full-force. “Nobody in cities like Beijing and Shanghai and Guangzhou are venturing outside,” Michael Dunne, head of Asian automotive consulting firm ZoZo Go, told NBC News last week. And as the industry continues to operate without a blueprint, “It is looking like there will be about 1 million units of lost production,” Dunne added. That is equal to about two weeks of normal Chinese output.

Much of China’s success as the world’s largest auto market is thanks to the country producing most of its vehicles locally. Complicating matters further is that the virus’s ground zero—Wuhan—is essentially China’s “Motor City.”

Beware of Misinformation

However, amid the anxiety-inducing headlines, there is some recent uplifting data.

First, it’s important to note that a diagnosis of coronavirus is not a death sentence. In fact, scientists at Imperial College London published new estimates placing fatality rate around 1%—down from previous estimates of over 2%.

Additionally, while China recorded the most deaths from the virus in a single day on Sunday (97), Reuters reports that the cure rate in Hubei province rose to 6.1% today. Compared with the 1.7% on January 27, that indicates that current medical treatments are having an effect.

World Health Organization experts are due to arrive in Beijing this evening to assist Chinese officials in stemming further spread of the virus.

Autonomous Rides Hit American Street

While the coronavirus undoubtedly deserves some of your anxiety, let’s turn to something that we here at the Engine Block find particularly terrifying: government-sanctioned autonomous vehicles.

That’s right, as we speed toward what is beginning to feel like an inevitable robot future, more self-driving cars are hitting the streets.

Here’s a quick round-up of some of the more eyebrow-raising headlines to emerge this week.

Uber Cleared To Start Self-Driving Testing in California

Despite legal battles, driver assault controversies, and a high-profile pedestrian death, Uber is set to restart its self-driving car testing program in California. Initially shut down after Elaine Herzberg was killed in a collision with a self-driving car in Tempe, Arizona, California’s Department of Motor Vehicles issued a permit last week.

“Before beginning any self-driving vehicle testing on our test track or public roads, we establish an operational design domain (ODD), which captures the specific conditions under which our self-driving system will operate, including where and when,” says the Uber ATG website. “At Uber ATG, we are committed to testing our system in a safe and responsible way. Defining and operating under a predetermined ODD that aligns our daily operational efforts with our system’s capabilities is critical to this effort.”

While there is no official date for when Uber will resume testing, San Francisco is the expected target. Uber ATG will also hit the streets of Pittsburgh, Dallas, Toronto, and Washington D.C.

US DOT Approves Nuro’s Next-Gen Driverless Delivery Design

Just last week the U.S. Department of Transportation (DOT) and the National Highway Safety Administration (NHTSA) approved a regulatory exemption for Nuro’s next-generation self-driving delivery vehicle, R2.

We reported on these adorable grocery-delivery pods in 2018, when the California-based robotics company released its first-gen models in Scottsdale, Arizona through a deal with grocery chain Kroger. This new generation of AV is bigger and heavier but thankfully still does not exceed 25 mph.

While these little pods have been zipping around Houston, Texas for a year already, this new exemption will allow them to operate without a human driver on board. Additionally, the R2 replaces traditional side and rearview mirrors with cameras, removes the steering wheel, and uses a specially rounded body design to better minimize damage should it accidentally make contact with an unsuspecting pedestrian.

As Business Insider points out, “NHTSA’s decision has significant implications for the autonomous-driving industry, as it could pave the way for other companies to make and use self-driving vehicles without steering wheels on public roads.” GM has been fishing for similar exemptions but has yet to receive permission, as the automaker’s request involves vehicles that would transport people, rather than groceries and pizzas.

Fully Autonomous Electric Shuttle Bus Hits Ohio Streets

Remember a few weeks ago when we told you guys about the big, self-driving toaster shuttle driving around the Bay Area? Well, now folks in Ohio are receiving a similar gift.

Residents of Columbus, say hello to the Linden LEAP.

A fully-electric, autonomous shuttle service designed to connect residents of the South Linden neighborhood with resources and transit centers in the rest of the city, LEAP will run 7 days a week and be free to all passengers 12 years old and up.

“Bringing smart technology and mobility into our neighborhoods is an important tool for sharing success and expanding opportunity,” said Columbus Mayor Andrew J. Ginther during the technology’s unveiling. “The launch of the Linden LEAP will help us guide future innovations in the community and beyond, using self-driving technology to help reduce barriers to community resources.”

Transformational Opportunity

The Linden LEAP will operate on a roughly 3-mile loop, starting at the Linden Transit Center, and making stops at the city’s biggest public housing development, a community rec center, and St. Stephen’s Community House which offers health and food resources. The company behind the technology, EasyMile, has said the shuttles will be capable of holding about twelve passengers, travel for 14 hours on a single charge and, while being fully autonomous, still have an on-board driver set to take over in case of emergency.

The pilot program is expected to last one year, after which EasyMile and the city will “share [their] findings with the community and stakeholders to aid in determining next steps,” according to the Linden LEAP website.

We’ll concede that this headline is the least alarming of the bunch and seems to represent the more positive environmental and economic possibilities of autonomous vehicles. Stay tuned, as we’ll be watching this pilot program with interest. (And we suspect so will every other major metropolitan area in the U.S.)

New Vehicles Debut for American Consumers

It’s been a busy week for new vehicle reveals, but we’re going to highlight two that we think made the biggest waves with auto enthusiasts over the last few days. 

2021 Cadillac Escalade

Few names are more recognizable in the luxury space than Cadillac—and the brand’s 2021 Escalade debut proved it is still worthy of that cachet. Debuting this past week at a special event in L.A., the new Escalade is being hailed as a shining example of “what’s to come” for vehicle design. Sporting nearly 40 inches of digital screen space, compliments of  the industry’s first curved OLED screen, the next-gen brawny SUV promises a customizable display with twice the pixel density of a 4K TV, according to the manufacturer.

The innovation doesn’t stop there, however. The 2021 Cadillac Escalade also comes standard with back, front, and side two-megapixel cameras to provide a truly “surround vision” birds-eye view for the outside of the vehicle, along with enhanced augmented reality functions for its navigation features, Super Cruise hands-free driving technology, and an (optional) industry-first 36-speaker sound system.

Bigger than ever, the new Caddy boasts a familar 420-hp 6.2-liter gas V8 or new 277-hp 3.0-liter I6 turbodiesel, both mated to a 10-speed auto. There’s no official release date yet but rumors say “sometime this summer.”

2020 Jeep Gladiator Mojave

There’s nothing like hauling ass across white-hot desert sand dunes in a thoroughly-equipped pickup built for the job. For a long time, the Chevy Colorado ZR2 and Ford F-150 Raptor have dominated that space. Now, however, it looks like Jeep is getting in on the action. 

Debuting at the Chicago Auto Show this past week, the new Jeep Gladiator Mojave marks the brand’s first-ever “Desert Rated” model. Featuring an upgraded Fox suspension, reinforced frame and axles, 17-inch wheels wrapped in 33-inch Falken Wildpeak all-terrain tires, and special underbody protection—in addition to the vehicle’s already rugged design—the new Gladiator trim will surely have desert off-road enthusiasts waiting with bated breath. While Jeep has yet to put out any official pricing data as of yet, the Gladiator Mojave is expected to debut somewhere in the 43k-range sometime in the second quarter. Check out the video below for more details.

New Mergers Emerge

As seems to be the norm now in the auto industry, more partnerships, acquisitions, and general shuffling is taking place. Here are two major ones you should be aware of:

Edelbrock Partners With COMP

Private equity firm and Edelbrock-owner, Industrial Opportunity Partners (IOP) announced the acquisition of COMP Performance Group last week. Despite joining forces, a press release on the matter indicates that the companies will continue to operate as independent organizations.

We expect some interesting cross-pollination of performance to emerge from this deal.

Investment Company Buys Up Recaro

Premium seating brand Recaro was sold off last week to Raven Acquisition LLC, a privately owned, Detroit-based investment corporation. Automotive News reports that, “Raven is led by a former Recaro executive and TCE Enterprises, a family investment company with experience in the auto industry.”

The Engine Block is your one-stop source for any and all auto industry news. Keep an eye on our weekly round-up of enthusiast coverage, product reviews, vehicle spotlights, auto show/expo features, and more. Be sure to check back tomorrow for more in-depth coverage of Josh Blyler’s win at 2020 King of the Hammers, Doug Kalitta’s third-time victory at NHRA Winternationals, and a tribute to professional race car driver John Andretti.