Auto Industry News: Nissan CEO Hiroto Saikawa Is Out, California’s AB5 Is In, and 2019 IAA Climate Protests Carry On

From protests outside the 2019 IAA, another executive shakeup for Nissan as CEO Hiroto Saikawa steps down, and California making headlines yet again, this time with the passage of AB5, it’s been an interesting week in auto news. Add in the excitement of a championship stretch for NASCAR and NHRA racing, and there’s a whole lot to cover this week.

2019 IAA Faces Frankfurt Climate Protestors

Another year, another Internationale Automobili-Ausstellung (IAA), better known as the Frankfurt Motor Show. The world’s largest auto show was noticeably missing a few key players, as brands like Fiat, Mitsubishi, Toyota, Chevy, and Ferrari all skipped the event. However, while some automakers may have stayed home, angry climate change activists certainly did not.

A group of nearly 25,000 people, including 18,000 cyclists, marched through the streets of Frankfurt, blocking motorways and picketing outside the show’s venue. Calling for an immediate end to combustion engines and shift toward climate-neutral transportation, they were apparently not impressed with the amount of EVs on display at this year’s IAA.

Holding signs with messages like “STOP SUV,” “SUV not cool” and “we can’t replace our lungs,” the protestors cited a Greenpeace report from earlier this week claiming that German automakers Volkswagen, Daimler, and BMW, were responsible for pumping 878 million tons of CO2 into the atmosphere in 2018. “Despite the unavoidable effects of the climate crisis, manufacturers at the IAA continue to present a majority of cars that burn petrol or diesel,” stated the climate organization in a pre-protest statement. “Only about a quarter of the newly introduced vehicles in Frankfurt are pure electric cars.”

Opening a Dialogue

Automakers, for their part, seem at least somewhat willing to listen. While only 25% of the cars on display at the 2019 IAA are full-EV, some are actually production-ready, like the Honda E hatchback and luxury Porsche Taycan. There were also plenty of concepts (some wacky, some viable) showing that the investments are being made. Additionally, VW CEO Herbert Diess is meeting with “Sand in the Gearbox” activists tonight, Monday September 16, to discuss accusations made against the industry.

While the shift to greener vehicles may be happening slower than many people are comfortable with, it is happening. Those fearing climate change or simply looking to decrease their carbon footprint should look to the 2019 IAA as an encouraging sign of the things to come for the auto industry.

Nissan CEO Hiroto Saikawa Steps Down

It’s safe to say that, from a leadership standpoint, things could definitely be going better at Nissan’s headquarters. After former company exec Carlos Ghosn was ousted amid serious corruption allegations, the Japanese automaker’s current CEO, Hiroto Saikawa, is being forced out as well.

Saikawa announced he’d be stepping down from his position as CEO after an internal investigation revealed falsified documents that gave him a $900,000 pay boost in 2013. Nissan Board Chairman Yasushi Kimura explained that while the stock-related payments themselves were not illegal, the overall program was “intentionally manipulated” to garner a larger payout.

Nissan has not said that Saikawa’s resignation is a direct result of the scandal, rather stating that the CEO had already indicated his intention to leave and “after discussion, the board asked him to resign as representative executive officer and CEO of the company, effective September 16, and he accepted,” per a Nissan press release.

According to CNBC, Nissan believes that Ghosn and board director Greg Kelly, “concealed more than $327 million in payments to themselves and other executives — $187 million in non-disclosed compensation and $140 million in improper expenditures,” and seems to be keeping the blame squarely focused on the two men for now. While Saikawa doesn’t seem to be facing anything more than a call to return the money, it’s quite a way to end a 40-year career with the company. It is also yet another black eye for an automaker that could really use a win right now.

California’s AB5 Strikes at Heart of Gig Economy

The Golden State just can’t stay out of the headlines these days. California lawmakers voted in favor of AB5 this week, a sweeping piece of legislation set to improve the lives and working conditions of so-called “gig economy” employees. The bill now sits on the desk of Governor Gavin Newsom to be signed into law.

If signed —which is likely, seeing as the governor explicitly endorsed the bill— AB5 will change the classification of many workers into full employees, affording them health benefits, better pay, and the ability to better unionize.

While momentum for the bill came largely from frustrated Uber and Lyft drivers, its passage could affect much more than just the ride-hailing industry. CBS News reports, “Trucking companies, newspaper publishers, and cleaning operations could be among those widely impacted by Assembly Bill 5, sometimes referred to as the “Uber law”— although Uber maintains the bill doesn’t apply to its drivers. While about 400,000 Californians work for gig platforms like Uber and Doordash, an army of 1.5 million freelance workers in the state could also be covered by the new law.”

How AB5 Came Into Play

For some context, Uber and Lyft drivers are currently classified as independent contractors, allowing ride-sharing companies to avoid standards like minimum wage, health care, and on-job injury compensation. AB5 would require that this massive fleet of drivers be treated as full-fledged employees. To put it simply: that would cripple these companies’ business models that have built an empire on cheap labor that maintains its own vehicles.

But while Uber and Lyft refuse to go down without a fight, many non-Silicon Valley industries that properly classify their workers as independent contractors don’t have $90 million to spend on a statewide ballot initiative to exempt them from the fallout of AB5. (However, get ready for them to launch a stream of law suits…)

How this will impact the rideshare market—as well as other gig industries—is still very much up in the air, especially as questions of intellectual property come into play. Keep an eye out for further coverage of this one.

Around the Circuit

NASCAR

Monster Energy Series

Martin Truex Jr. and his team found themselves raising a trophy for the first time in nearly three months this week, finishing first in the Cup Series opener this weekend for his fifth victory of the year. This finish punches Truex Jr. and his team’s ticket to the next round of the playoffs, finishing a comfortable 4.173 seconds ahead of Kevin Harvick in second and Brad Keselowski in third.

“Hell of a way to make a championship run,” he said. “Get some good bonus points, move on to the next round, see what we can do there.’’

Next up for Monster Energy cup series racers is the Federated Auto Parts 400 on September 21 at Richmond Raceway.

Xfinity Series

Tyler Reddick gambled and won this weekend at Las Vegas Motor Speedway in the DC Solar 300, holding off Christopher Bell by .0738 seconds for his fifth win and locking up the regular-season championship.

Reddick pushed his Richard Childress Racing car to the max this weekend, taking a major chance on fuel to edge out the narrow victory. “Christopher Bell had a really fast race car today, but we were just able to come in and get fuel and tires and run really fast laps to keep us in front of him,’’ said Reddick. “Hats off to (crew chief) Randall (Burnett) and all the guys. We’ve had a really fast car in the past, unfortunately today we didn’t have it but we got them with strategy.’’

Next up for Xfinity series drivers is the Go Bowling 250 on September 20 at Richmond Raceway.

Gander Outdoor Trucks Series

Austin Hill put on a show in Vegas this weekend as well, locking in his third NASCAR victory of 2019 and progressing him into the second round of the playoffs with what might be his most impressive performance yet. Hill finished well ahead of fellow playoff contender Ross Chastain by an impressive 2.116 seconds, despite Chastain leading 88 out of the race’s 134 laps.

“This means the world to me,’’ said Hill. “When I saw the 45 (Chastain) in my sights, we were running close lap times. I changed my line a little bit. And that was a big statement win.’’

Next up for Gander Truck Series playoff racers after a few weeks of rest and relaxation is the Sugarlands Shine 250 at Talladega Superspeedway on October 12.

NHRA

Top Fuel

Richie Crampton beat out Doug Kalitta this weekend, taking his second Wally this season and the 10th of his career. An excellent performance at Maple Grove Raceway in fantastic weather this weekend, Crampton never trailed on the way to this win.

Funny Car

Jack Beckman beat out John Force in the Funny Car category this weekend, improving his record to 32 – 19 all-time against Force. To further push the point home, Beckman is 4 – 3 against Force prior to final rounds. This is Beckman’s first win of the season and his third overall at Maple Grove, along with giving him the Funny Car points lead.

Pro Stock

Jason Line finished ahead of Fernando Cuadra, despite giving up the starting line advantage. Line locked in his third win at Maple Grove, his third Wally this year and his 50th Pro Stock Wally.

Pro Stock Motorcycle

Jerry Savoie nabbed his second-straight Pro Stock Motorcycle victory this weekend, jumping from tenth to first in the Mello Yello standings. In the first all-Suzuki final round since last year’s Dallas event, Savoie defeated Steve Johnson with his best run of the event (6.774).