Struggling with the online used car dealer To the caravan does everything in its power to prevent enemy invasion – including the “poison pill” maneuver. Illinois dealers appeal to the state direct-to-customer EV sales order, and BYD is cautious when entering US market. All these stories and more The Morning shift For Wednesday, January 18, 2022.
Gear 1: Carvana swallows the Poison Pill
Carvana is said to have taken a “poison pill” to limit shareholders from taking a larger stake in the struggling company and fend off the threat of a hostile takeover. Company He also agreed to sell up to 4 billion dollars car loans.
Loans are purchased by Ally Band and Ally Financial It will give Carvana a new source of funding as it tries to rebuild its operations. From CNBC:
Carvana said the “poison pill” would help protect “substantial” US federal net operating loss (NOLs) that could be available to offset future taxable income.
If the company’s 5% shareholders increase their ownership, the company’s ability to use NOLs will be significantly limited, Carvana said.
Companies with large NOLs often take a poison pill to lower their tax bill. Poison pills are also taken to prevent enemy invasion.
Carvana, which some analysts say is in financial trouble after rapid expansion during the pandemic, set a 4.9% trigger for its shareholder rights plan.
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2nd Gear: Illinois dealers really want to kill Direct customer car sales
The Illinois Automobile Dealers Association has filed an appeal challenging a court order in Chicago that would have allowed Rivian and Lucid to continue selling their electric vehicles directly to customers in the state starting in December 2022. This is an expected move. From Automotive News:
In a decision dated December 19, 2022, Associate Judge David Atkins ruled that the Illinois Secretary of State was correct in issuing dealer licenses to EV startups, as it previously did for Tesla Inc. The decision opens the door for manufacturers to follow Tesla’s direct instructions. – sales model. Joe McMahon, executive director of the association, informed about this earlier Automotive News the decision gives special treatment to EV manufacturers.
McMahon said in a Jan. 5 statement that direct sales from manufacturers resulted in a monopoly with no price benefit.
The state’s dealer association, which represents 700 dealers, said the Illinois Vehicle Code and the Illinois Motor Vehicle Franchise Act require public transportation vehicles to be sold through licensed and independently franchised dealers.
Atkins says the dominant model of using franchised dealerships for new car sales is the no is a mandatory road according to state laws. Nevertheless, McMahon confirmed that the appeal was filed under those laws
“You can’t be a manufacturer and a dealer,” McMahon said. “It’s in the law, so we think it’s pretty clear.”
3rd Gear: BYD’s cautious approach to the US
China’s electric car BYD is embarking on a journey of rapid global expansion, growing significantly Almost every market except the US, where BYD’s biggest competitor, Tesla, is number one in EV sales. Chinese the automaker has reportedly spent much of the past year researching how to build a U.S. distribution network for its electric vehicles.
Everything was going according to plan… until it wasn’t. Tensions between Washington and Beijing, anti-China sentiment in the US and President Biden’s priority to boost home-grown EVs forced BYD to hit the pause button on a big announcement at CES this year. From Reuters:
The source said that BYD’s management has not yet given the final green light to the project, and aggressive US expansion does not seem possible in the near future.
“BYD is wary of the US,” the person said. “Think about all the US-China political tensions and then think about the frenzy of the whole world right now. You don’t want to get into a big mess.”
BYD’s US project has been hampered by the Biden administration’s Inflation Reduction Act (IRA), which imposes rules on where battery materials can be sourced and disqualifies EVs manufactured outside of North America for a $7,500 purchase rebate.
“Who’s going to start selling cars with a $7,500 disadvantage?” another source said.
BYD was the best selling company in the world Electric cars and plug-in hybrids 2022. Sold a total of 1.86 million vehicles, mostly in China. Far ahead of Tesla’s 1.3 million vehicles sales that year.
4th Gear: DoJ Wants Airplane Covid Mask Mandates Back
The Justice Department has reportedly asked an appeals court panel to overturn a government order requiring masks to be worn on planes, buses, trains, delivery services, airports and other transportation hubs starting in April 2021. From Reuters:
A three-judge panel of the 11th Circuit Court of Appeals heard arguments on the government’s appeal of a decision by a U.S. District Court judge in Florida that found the U.S. Centers for Disease Control and Prevention (CDC) lacked legal authority to conduct nationwide travel. Mask mandate to fight COVID-19.
The CDC issued the dust mask mandate in January 2021, just days after Joe Biden became president.
In October, a report by US lawmakers said the Trump administration blocked the CDC from passing a federal transport mask mandate in 2020.
Most of the arguments in the petition focus on the CDC’s decision to implement the requirements immediately instead of giving the public a chance to comment on the mandate.
Justice Department attorney Brian Springer said the CDC could impose mask requirements without giving the public time to comment on the pandemic emergency. Springer argued that the move was necessary “to prevent possible infections and deaths if people don’t just do the simple thing of wearing a mask when they travel.”
Earlier this month, the European Union recommended face masks for passengers flying from China to member countries. The country is facing a major Covid outbreak after the Chinese government scrapped its zero-Covid policy.
5th Gear: Tesla’s Price reductions in China worked
Tesla has a retail stake China reported a rise this month after the US-based electric car maker cut prices According to data from China Merchants Bank International, the best-selling models in early January.
Average daily Tesla sales in the country are said to have increased by 76 percent January 9 and 15th compared to the same period a year ago. The data shows that the automaker sold 12,654 vehicles during this week. From Reuters:
That’s compared to a 14.5% year-on-year decline in total retail car sales in China in the same week, data shows, even as sales of electric and hybrid vehicles in the country rose 36.5%.
Tesla did not immediately respond to a request for comment on CMBI’s sales data.
Tesla cut prices of its Model 3 and Model Y cars in China by 6% to 13.5% on Jan. 6 amid signs of weaker demand and stiffer competition in the world’s biggest auto market, analysts said.
Tesla cut the prices of its popular Model 3 sedan and Model Y crossover between 6 and 13.5 percent in China on January 6.demand and stronger competition.
As Tesla lowers prices in China and other Asian markets for the first time, was accompanied by a reduction in prices Europe and USA.
Counter: GM swears it had nothing to do with Dhe Whis bankruptcy
Whatever you have to tell yourself, I guess.
Neutral: These Pumpkins Power Up
I bought these pumpkins back in October of last year and they still look great. Are they cursed? I’m worried about my safety and the safety of my cats (my boyfriend will be fine).