2005 Volkswagen Jetta Gli Sedan 4-door 1.8l on 2040-cars

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Automakers face reality of EVs' cost — to jobs, and their bottom line

Related: We obsessively covered the Frankfurt Motor Show — here's our complete coverage FRANKFURT, Germany — European car bosses gathering for the Frankfurt auto show are beginning to address the realities of mass vehicle electrification, and its consequences for jobs and profit, their minds focused by government pledges to outlaw the combustion engine. As the latest such announcement by China added momentum to a push for zero-emissions motoring, Daimler, Volkswagen and PSA Group gave details about their electric programs that could give policymakers some pause. Planned electric Mercedes models will initially be just half as profitable as conventional alternatives, Daimler warned — forcing the group to find savings by outsourcing more component manufacturing, which may in turn threaten German jobs. "In-house production is almost irrelevant to the consumer," Daimler boss Dieter Zetsche told reporters on the eve of the Frankfurt Motor Show, in the midst of a German election campaign in which automotive jobs have loomed large. The company set a target of saving 4 billion euros ($4.8 billion) by 2025 to help fund the cost of its electric cars. "Daimler is the first company to state explicitly how much electric vehicles are going to hurt margins," said Bernstein analyst Max Warburton. "It was brave to go first — but of course it won't be the last." Volkswagen, for its part, said it was seeking new global supplier contracts to source 50 billion euros ($60 billion) of electric car content including batteries, which are not yet manufactured competitively in Europe. "A company like Volkswagen must lead, not follow," Chief Executive Matthias Mueller told reporters. VW diesel emissions-cheating exposed by U.S. regulators in 2015 triggered global public outrage, dozens more investigations into test-rigging by the wider industry and a push by some lawmakers to ban diesel and eventually all engines. TIGHTENING NOOSE Tesla shares jumped nearly 6 percent on Monday after a Chinese minister said it was a question of when, not if, Beijing bans fossil-fuel cars, tightening the noose around the combustion engine. France and Britain have promised its outright abolition by 2040. But PSA, the maker of Peugeots and Citroens, said it was concerned about the risks if consumers were left behind in the rush, and a new generation of battery cars does not sell.

VW GTI Clubsport Concept celebrates model's 40th birthday with 261 hp

Volkswagen is celebrating the four-decade milestone for the GTI with the world debut of the GTI Clubsport concept at the annual Worthersee festival in Austria. While the version in these sketches is just a prototype, European buyers at least are set to get a production model in early 2016. The Clubsport is essentially a way for VW to split the difference between the already well-liked GTI and the hotter Golf R. In concept form, it packs 261 horsepower, compared to 220 hp from the standard version in the US with the Performance Package or 292 hp from the R. A temporary overboost function even lets the Clubsport make about 10 percent more power for short periods. Beyond just the mechanical upgrades, the concept in these sketches also wears a revised lower air dam at the front with a mesh grille and big strakes at the corners, and there's a new roof spoiler and rear diffuser at the back. VW also promises a more "individualized" interior. Unfortunately, the North America might not be getting this more powerful GTI. "There are no plans to bring the car to the US currently," VW spokesperson Mark Gillies told Autoblog. At this time, VW only has info about the Clubsport in German, which you can take a look at below. Related Video: Weltpremiere des Golf GTI Clubsport am Worthersee Exklusives Jubilaumsmodell zum 40. Geburtstag des GTI Golf GTI Clubsport debutiert mit 265 PS und Boost-Funktion Im kommenden Jahr feiert der Golf GTI seinen 40. Geburtstag. Volkswagen wird dieses historische Ereignis mit einem progressiven Jubilaumsmodell adeln: dem neuen Golf GTI Clubsport. In Form einer seriennahen Studie wird Volkswagen den Golf GTI Clubsport bereits am 14. Mai 2015 als Weltpremiere im Rahmen des legendaren GTI-Treffens am Worthersee prasentieren. Mit einer Leistung von 195 kW / 265 PS (plus 35 PS gegenuber dem Golf GTI Performance*) sowie einer temporar dank Boost-Funktion nochmals um rund 10 Prozent hoheren Spitzenleistung soll der Golf GTI Clubsport Anfang 2016 als der bis dato starkste jemals in Serie gebaute „GTI" durchstarten. Das Jubilaumsmodell wird nicht nur mit einem extrem leistungsstarken Motor, sondern mit einem individualisierten Interieur und exklusiven Karosseriedetails auf den Markt kommen. Zu den Design-Modifikationen gehoren ein komplett neuer Frontstoss-fanger, neue Seitenschweller, ein ebenfalls neuer und aerodynamisch hoch innovativer Dachkantenspoiler sowie ein eigens entwickelter Heckdiffusor.

Foreign automakers pay from $38 to $65 per hour to non-union workers

As leaders for the United Auto Workers gather in Detroit for their Special Convention on Collective Bargaining to work out the negotiating stance for this year's new labor agreements with the Detroit 3 automakers, what they most want to do is figure out how to eliminate the two-tier wage scale. However, the lower Tier 2 wage has allowed the domestic automakers to reduce their labor costs, hire more workers, and compete better with their import competition. As it stands, per-hour labor rates including benefits are $58 at General Motors, $57 at Ford, and $48 at Fiat-Chrysler – a reflection of FCA's much greater number of Tier 2 workers. The Center for Automotive Research released a study of labor rates (including benefits) that put numbers to what the imports pay: Mercedes-Benz pays the most, at an average of $65 per hour, Volkswagen pays the least, at $38 per hour, and BMW is just a hair above that at $39 per hour. Among the Detroit competitors, Honda workers earn an average of $49 per hour, at Toyota it's $48 per hour, Nissan is $42 per hour, and Hyundai-Kia pays $41 per hour. The lower import wages are aided by their greater use of temporary workers compared to the domestics. Automotive News says the ten-dollar gap between those foreign camakers and the domestics turns out to about an extra $250 per car in labor, which adds up quickly when you're pumping out many millions of cars. That $250-per-car number is one that, come negotiating time, the Detroit 3 will want to reduce, as the UAW is trying to raise both Tier 1 and Tier 2 wages. Another wrinkle is that the domestic carmakers are considering the wide adoption of a third wage level lower than Tier 2. Some workers who do minor tasks like assembling parts trays kits and battery packs already make less than Tier 2, but the UAW will be quite wary about cementing yet another wage scale at the bottom of the system while it's trying to fight a bigger battle at the top. News Source: Automotive News - sub. req., BloombergImage Credit: AP Photo/Erik Schelzig Earnings/Financials UAW/Unions BMW Chevrolet Fiat Ford GM Honda Hyundai Kia Mercedes-Benz Nissan Toyota Volkswagen labor wages collective bargaining labor costs