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Auto Roundup: TSLA's Cybertruck Recall, LAD's Investment in Wheels & More
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The cyberattack on CDK Global, a leading provider of dealership management systems for auto retailers, has caused significant disruption across North America. The attack, perpetrated by the hacking group BlackSuit, has sent shockwaves through the auto industry. It has led to a prolonged system outage, forcing thousands of dealerships to revert to manual processes and causing widespread operational headaches.
The outage has prompted many auto retailing giants like AutoNation, Lithia Motors, Group 1 Automotive, Sonic Automotive and Asbury Automotive to get back to paper-based processes to continue their operations. Each of these companies flagged disruptions due to the CDK outage and is taking precautionary measures to protect systems and data. Despite these measures, the outage led to slower operations and increased laborious tasks for staff. (Read More: CDK Cyberattack Throws Auto Retailers Into Operational Chaos)
On the news front, auto retailer Lithia Motors (LAD - Free Report) made an investment in Wheels to help it innovate its top-tier product offerings for corporate clients. Electric vehicle (EV) behemoth Tesla (TSLA - Free Report) issued a recall of nearly 12,000 Cybertrucks to fix trim pieces and faulty motor controllers in the front windshield wipers. Japan’s auto giant Toyota (TM - Free Report) made its Lexus charging stations accessible to other EV brands in Japan. Hydrogen mobility company Hyzon Motors (HYZN - Free Report) is refocusing on core North American markets and the refuse industry, exploring strategic options, including potential divestments, to enhance its 200kW fuel cell technology for zero-emission trucks while managing costs and liquidity.
Last Week’s Important News
Tesla issued two recalls for its Cybertruck pickups in the United States. The automaker is still struggling with the challenges associated with the new EV roughly six months after deliveries began. One recall is associated with issues with trim pieces that can loosen and fall off the trunk, while the other involves faulty motor controllers in the front windshield wipers. Nearly all of the 12,000 Cybertrucks on the road are affected by the recall.
Per a report by the National Highway Traffic Safety Administration (NHTSA), if a trim piece detaches while driving, it could create a road hazard and increase the risk of injury or collision for other motorists. Tesla plans to replace or rework the trim piece to ensure sufficient adhesion. Per another report by NHTSA, some vehicles have a front windshield wiper motor controller that may fail due to electrical overstress, reducing visibility and increasing the risk of a collision. Tesla will replace the motor controller for affected customers. Cybertruck owners will be asked to bring their trucks to a service center for these repairs, with notifications beginning in mid-August.
Lithia, alongside Marubeni Corporation, made a notable minority investment in Wheels, a prominent fleet management company in North America. This strategic move positions Wheels with key players in the mobility industry as it carries on to innovate its top-tier product offerings for corporate clients. Recognizing the ever-evolving automotive sector, Wheels values the extensive industry expertise brought by Marubeni and LAD.
Lithia, one of the largest dealership groups in the United States, shares Wheels' dedication to offering comprehensive services throughout the vehicle lifecycle, from acquisition and financing to maintenance and repair. The transaction is anticipated to be finalized in the third quarter of 2024, pending standard closing conditions.
Hyzon is shifting its strategic priorities to concentrate on its core markets in North America and the refuse industry. It arrived at this decision after a thorough review of its operations. Alongside efforts to secure funding, the company has hired PJT Partners as its financial advisor to oversee the capital-raising process through various transactions and explore strategic options, which might include selling the company or divesting its European and Australia/New Zealand businesses, among other possibilities. During this exploration, Hyzon will continue to focus on reducing costs and managing liquidity, potentially including workforce reductions or other strategic actions.
This realignment will enable HYZN to focus on its financial resources and investments to better position its pioneering 200kW single-stack fuel cell technology for zero-emission North American Class 8 and refuse truck Fuel Cell Electric Vehicle platforms. The company is preparing to launch major fleet trial programs for these platforms in the United States and Canada this summer.
Toyota has opened Lexus charging stations to all EV brands in Japan. With their 150kW max quick chargers, other EVs can now use Lexus charging stations. Previously, these stations were exclusive to Lexus owners and accessible via the My Lexus app. The charging fee is ¥120 per minute and users are required to make a reservation online. It offers users complimentary refreshments, workspaces, reserved spots and discounts on various services.
Users can also reserve a spot up to 60 days in advance and pay conveniently through the app. Currently, there are two Lexus rapid charging stations in Japan. The first station is in Tokyo Midtown Hibiya and the other is at Karuiza Common Grounds, Karuizawa, in Nagano Prefecture. Toyota plans to add two more stations in Osaka and Nagoya by March 2025 and aims to expand to 100 stations throughout Japan by 2030.
Price Performance
The following table shows the price movement of some of the major auto players over the last week and six-month period.
Image Source: Zacks Investment Research
What’s Next in the Auto Space?
Stay tuned for second-quarter U.S. vehicle delivery numbers to be unveiled by various auto giants.
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Auto Roundup: TSLA's Cybertruck Recall, LAD's Investment in Wheels & More
The cyberattack on CDK Global, a leading provider of dealership management systems for auto retailers, has caused significant disruption across North America. The attack, perpetrated by the hacking group BlackSuit, has sent shockwaves through the auto industry. It has led to a prolonged system outage, forcing thousands of dealerships to revert to manual processes and causing widespread operational headaches.
The outage has prompted many auto retailing giants like AutoNation, Lithia Motors, Group 1 Automotive, Sonic Automotive and Asbury Automotive to get back to paper-based processes to continue their operations. Each of these companies flagged disruptions due to the CDK outage and is taking precautionary measures to protect systems and data. Despite these measures, the outage led to slower operations and increased laborious tasks for staff. (Read More: CDK Cyberattack Throws Auto Retailers Into Operational Chaos)
On the news front, auto retailer Lithia Motors (LAD - Free Report) made an investment in Wheels to help it innovate its top-tier product offerings for corporate clients. Electric vehicle (EV) behemoth Tesla (TSLA - Free Report) issued a recall of nearly 12,000 Cybertrucks to fix trim pieces and faulty motor controllers in the front windshield wipers. Japan’s auto giant Toyota (TM - Free Report) made its Lexus charging stations accessible to other EV brands in Japan. Hydrogen mobility company Hyzon Motors (HYZN - Free Report) is refocusing on core North American markets and the refuse industry, exploring strategic options, including potential divestments, to enhance its 200kW fuel cell technology for zero-emission trucks while managing costs and liquidity.
Last Week’s Important News
Tesla issued two recalls for its Cybertruck pickups in the United States. The automaker is still struggling with the challenges associated with the new EV roughly six months after deliveries began. One recall is associated with issues with trim pieces that can loosen and fall off the trunk, while the other involves faulty motor controllers in the front windshield wipers. Nearly all of the 12,000 Cybertrucks on the road are affected by the recall.
Per a report by the National Highway Traffic Safety Administration (NHTSA), if a trim piece detaches while driving, it could create a road hazard and increase the risk of injury or collision for other motorists. Tesla plans to replace or rework the trim piece to ensure sufficient adhesion. Per another report by NHTSA, some vehicles have a front windshield wiper motor controller that may fail due to electrical overstress, reducing visibility and increasing the risk of a collision. Tesla will replace the motor controller for affected customers. Cybertruck owners will be asked to bring their trucks to a service center for these repairs, with notifications beginning in mid-August.
Tesla currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Lithia, alongside Marubeni Corporation, made a notable minority investment in Wheels, a prominent fleet management company in North America. This strategic move positions Wheels with key players in the mobility industry as it carries on to innovate its top-tier product offerings for corporate clients. Recognizing the ever-evolving automotive sector, Wheels values the extensive industry expertise brought by Marubeni and LAD.
Lithia, one of the largest dealership groups in the United States, shares Wheels' dedication to offering comprehensive services throughout the vehicle lifecycle, from acquisition and financing to maintenance and repair. The transaction is anticipated to be finalized in the third quarter of 2024, pending standard closing conditions.
Hyzon is shifting its strategic priorities to concentrate on its core markets in North America and the refuse industry. It arrived at this decision after a thorough review of its operations. Alongside efforts to secure funding, the company has hired PJT Partners as its financial advisor to oversee the capital-raising process through various transactions and explore strategic options, which might include selling the company or divesting its European and Australia/New Zealand businesses, among other possibilities. During this exploration, Hyzon will continue to focus on reducing costs and managing liquidity, potentially including workforce reductions or other strategic actions.
This realignment will enable HYZN to focus on its financial resources and investments to better position its pioneering 200kW single-stack fuel cell technology for zero-emission North American Class 8 and refuse truck Fuel Cell Electric Vehicle platforms. The company is preparing to launch major fleet trial programs for these platforms in the United States and Canada this summer.
Toyota has opened Lexus charging stations to all EV brands in Japan. With their 150kW max quick chargers, other EVs can now use Lexus charging stations. Previously, these stations were exclusive to Lexus owners and accessible via the My Lexus app. The charging fee is ¥120 per minute and users are required to make a reservation online. It offers users complimentary refreshments, workspaces, reserved spots and discounts on various services.
Users can also reserve a spot up to 60 days in advance and pay conveniently through the app. Currently, there are two Lexus rapid charging stations in Japan. The first station is in Tokyo Midtown Hibiya and the other is at Karuiza Common Grounds, Karuizawa, in Nagano Prefecture. Toyota plans to add two more stations in Osaka and Nagoya by March 2025 and aims to expand to 100 stations throughout Japan by 2030.
Price Performance
The following table shows the price movement of some of the major auto players over the last week and six-month period.
Image Source: Zacks Investment Research
What’s Next in the Auto Space?
Stay tuned for second-quarter U.S. vehicle delivery numbers to be unveiled by various auto giants.