Happy Thursday! It’s April 11, 2024, and this is The Morning Shift, your daily roundup of the top automotive headlines from around the world, in one place. Here are the important stories you need to know.
1st Gear: European Tesla Investors Are Fed Up With Elon Musk’s Anti-Union Stance
Over in Sweden, Tesla mechanics have been striking against the company. This isn’t unusual in Sweden, where unions are popular, but it doesn’t seem to be drawing the attention of one Elon Musk, CEO. Musk appears to think the whole “strike” thing is played out, but investors are less sure. From Reuters:
Tesla (TSLA.O), opens new tab investor KLP may ask the automaker’s annual general meeting to address CEO Elon Musk’s reluctance to engage in collective bargaining, the Norwegian pension fund said on Thursday.
A strike by Tesla mechanics in Sweden, among the country’s longest labour disputes, has for months disrupted the automaker’s operations and attracted the concern of several Nordic institutional investors.
On Monday, Musk said “the storm had passed on that front”. But the strike is continuing and the union leading the action told Reuters this week it may ramp it up.
KLP, Norway’s largest pension fund, was a signatory to a December letter sent by Nordic investors expressing their concern about the strike in Sweden and Tesla’s reluctance to acknowledge a right to collective bargaining.
I wish I had enough money to simply pretend the very real roadblocks facing my numerous companies didn’t exist. At some level of net worth, reality no longer applies to you in day-to-day life, so it’s easy to get caught up thinking that it won’t apply to your businesses either. This is basically what “Succession” was about, except with a publishing empire scion playing the role of Grimes.
2nd Gear: The Cars, They’re Back In Stock
Since COVID-19 wrecked supply chains, cars have been hard to come by. Dealers loved this, since it meant markups on anything they could get in stock, but those days appear to be coming to an end — inventories are back to 2020 levels. From Automotive News:
New-vehicle inventory in the U.S. continued to climb in March and reached its highest point since December 2020, according to Cox Automotive.
Cox said inventory stood at 2,837,400 in its latest estimate, a 74-day supply, up slightly from the previous month. A year earlier, it was 1.9 million vehicles, a 35 percent year-over-year increase, Cox said.
Cox said inventory varied greatly based on sticker price. Vehicles that were $30,000 to $40,000 had the tightest supplies, at 59 days, while the supply of vehicles priced under $20,000 stood at 66 days. Vehicles between $20,000 and $30,000 had a 67-day supply, Cox said. Supply was greatest among vehicles in the $60,000 to $80,000 range at 98 days, down slightly from the previous month.
Folks, mission accomplished: We solved the biggest problem to come out of the year 2020. What do you mean people are still catching COVID? There’s a vaccine now, they’re not supposed to still catch it. That’s how those work — you make a vaccine, and then no one ever has to think about the incredibly contagious brain-wrecking disease again. Get back in the office, everyone.
3rd Gear: Did Your Insurance Premium Go Up? You’re Not Alone
Getting a new car is great: The smells, the pristine materials, the way the center screen isn’t covered in drive-thru-greased finger smudges yet. Then, though, you have to get insurance — and that part’s gotten quite a bit worse in recent months. From Reuters:
In one of the cruel twists of an inflation-weary U.S. economy, car prices are coming down after surging by record amounts during the COVID-19 pandemic. But at least part of those gains for consumers are getting gobbled up by rising auto insurance rates that for some models now account for more than a quarter of the total cost of owning a vehicle.
…
“We’re hearing from a number of shoppers that they’re declining to buy a car – or returning one – because they can afford the car, but not the insurance for it,” said Sean Tucker, a senior editor at Kelley Blue Book, a car valuation and research company in Irvine, California.
Tucker said Kelley Blue Book recently added insurance guidance to its list of buying tips, urging shoppers to get an insurance quote before they put down any money.
Car insurance rates vary widely across the country and are influenced by everything from the cost local collision repair shops charge to the potential for damage from tropical storms and wildfires. According to the insurance shopping site Insurify, the average cost in the U.S. for full auto coverage rose 24% last year and now stands at just over $182 a month. The company said 63% of drivers it surveyed saw rates increase in 2023 and predicts rates will rise another 7% in 2024. But that figure could rise.
I, once again, cannot recommend motorcycling enough. I have comprehensive coverage on my GS — a BMW, no less — and I pay under 40 bucks a month as a driver with a less-than-perfect record. Two wheels good.
4th Gear: CarMax Is Selling More Cars For Less Money
CarMax is an interesting business model — cars bought and sold, agnostic of any particular brand — and it’s grown into a nationally-recognized name. Yet, things haven’t been looking fantastic for the company in the past few months, according to fourth-quarter results parsed by Automotive News:
Used-vehicle retailer CarMax Inc. reported Thursday net income of $50 million in the fourth quarter, a drop of 27 percent from the same time a year ago. Revenue in the quarter ended Feb. 29, 2024, fell 1.7 percent to $5.6 billion.
CarMax, of Richmond, Va., also said it sold more used vehicles to retail customers in its fiscal fourth quarter than it did in the year-earlier period. The company said it retailed 172,057 used vehicles in the fourth quarter, up 1.3 percent year-over-year. Same-store used-vehicle sales rose 0.1 percent.
CarMax said its gross profit per retail used vehicle was $2,251, down $26 compared with last year’s fourth quarter.
CarMax sales as a whole were down for 2023, but a high-volume Q4 with low profits is a bad look. Business only counts as booming when you’re actually making money off of it.
Reverse: Unlucky Number
Neutral: Did You Get To See The Eclipse?
I drove nearly 1,000 miles round-trip to my old college town on the path of totality, only for the day of the eclipse to be completely cloudy. The sky going dark was still amazing, but I guess I need to start planning a trip to Australia.
On The Radio: Total Yuppies – “Normal Life”
Speaking of my old college town. See if you can spot a college-aged Amber in a few of these shots.