Jaguar Land Rover wants to sweep up tech workers, Carvana investors are preparing for a crash, GM looks to reduce EV costs. All this and more in today’s issue of The Morning Dump.
Welcome to The Morning Dump, bite-sized stories corralled into a single article for your morning perusal. If your morning coffee’s working a little too well, pull up a throne and have a gander at the best of the rest of yesterday
Jaguar Land Rover Wants To Hire In Tech
You know how Twitter, Meta, and other tech companies are laying off workers right as we come towards the holiday season? Well, Jaguar Land Rover is looking at picking them up. According to the automaker’s official media release, it’s opened a job portal as it’s looking to hire 800 displaced tech workers with positions mostly based in Britain, America, Ireland, China, and Hungary. From the automaker:
Jaguar Land Rover has today announced a global hiring drive to fill more than 800 new digital and engineering vacancies across the UK, Ireland, USA, India, China and Hungary, as it seeks to recruit skilled workers from the digital technology industry.
Following the news of large-scale job losses from technology firms, Jaguar Land Rover is opening a new jobs portal for displaced workers from the tech industry to explore career opportunities, offering hybrid working patterns.
Holy crap, Jaguar Land Rover has the money to pay another 800 people? Either selling $200,000 Range Rovers has been a boon on the corporate side or the company’s making an aggressive bet. Regardless, it wasn’t that long ago that the company’s infotainment felt like a Palm Tungsten with a scaled-up screen and an electrified Range Rover just meant that the sunroof was possessed, so to see such a quick embrace of the digital age is cool.
Perhaps even more surprising is that JLR wants to hire for a little bit of everything. The marque has openings in areas as varied as cloud software, data science, electrification, machine learning, and autonomous driving. This should allow displaced tech workers to sink their teeth into many key aspects of upcoming models and genuinely help reshape the owner experience. Comment from digital product platform director Dave Nesbitt certainly seems to support this notion.
Jaguar Land Rover is transforming to an electric-first business, and we are creating some of the most digitally advanced vehicles ever seen. Through our products we will create new experiences, new levels of intimacy and connected car services for our customers, to give clients a true modern luxury experience.
Considering that the first electric Range Rovers are just a few short years away, this hiring spree should do JLR some proper good. So, if you’ve recently been laid off from a tech job and have always wanted to work in the automotive industry, maybe give JLR a shout.
Carvana’s Forecast Doesn’t Seem So Sunny
Between pissing off multiple states, allegedly failing to title customers’ cars in a timely fashion, and just burning through cash like it’s 87-octane, Carvana’s had a pretty bad year. According to Bloomberg, Carvana investors are now bracing for impact despite the company being liquid enough to last through 2023.
“The company grew too fast and now we are seeing the ramifications of it,” said John Kerschner, head of US securitized products at Janus Henderson Group.
Carvana needs a steady drip of financing to conduct its business, as do many corporations. It’s sold nearly $6 billion of corporate bonds over the last two years. It makes auto loans to car buyers, and sells those loans to other firms, or bundles them into bonds known as asset backed securities.
But funding is getting harder. The company’s corporate bonds trade between about 37 and 48 cents on the dollar, making it all but impossible for the company to borrow economically in that market.
“Carvana’s debt prices are saying default,” said Eric Rosenthal, senior director of leveraged finance at Fitch Ratings. “The debt prices in the secondary market are one of the best indicators of what you’re going to see happen with the company.”
If Carvana does go down that path, the used car market might briefly enter what is professionally known as the “lol, lmao zone.” Heaps of inventory could hit the wholesale market at lower prices than what Carvana paid for those cars in the first place, driving up auction supply for dealers to compete for. While hardly enough volume to crash used car pricing, it could be interesting.
GM Might Save A Lot Of Money
Between engineering, battery materials, and manufacturing, making electric cars is an expensive business. To help beef up margins, Automotive News reports that GM might’ve found a way to shave $2,000 off the cost of each EV the automaker builds. From the news site’s story titled “GM projects $2,000 savings per vehicle from digital retailing, regional EV fulfillment”:
The automaker has opened three centralized EV fulfillment centers — two in California and one in the Southeast, Reuss said. The inventory management change is designed to speed up vehicle delivery times — to as few as four days — and increase efficiency, which will reduce distribution costs, Reuss said.
“The biggest enterprise-wide cost savings will come as we and the dealers change how we handle inventory, which means we’re reducing how much we’re … incentivizing vehicles that were ordered that aren’t popular,” he said. “At the same time, we’ll improve the customer experience by delivering the exact vehicles our customers want quickly and efficiently.”
GM also has launched a digital retailing tool that currently works with the Chevrolet Bolt EV. Reuss said the platform will expand to include Cadillac in 2023. About 3,200 dealerships are enrolled on the digital retailing platform, representing about 80 percent of GM’s U.S. network, he said.
While speeding up delivery times should help consumers actually get cars, there doesn’t seem to be any indication that these cost-savings will be reflected in retail pricing. That’s not much of a surprise, but it’s a great reminder that tighter manufacturer control of new vehicle supply typically means more money for automakers.
Japan’s Also Mad About The Inflation Reduction Act
You know how we detailed yesterday that many countries are quite upset about the Inflation Reduction Act’s impact on EV tax credits? Judging by a Reuters report, we can add Japan to the list.
U.S. Trade Representative Katherine Tai and Japanese industry minister Yasutoshi Nishimura discussed new U.S. electric vehicle tax credits during a meeting on the sidelines of a summit in Bangkok, Tai’s office said on Thursday.
During their meeting on the sidelines of the Asia-Pacific Economic Cooperation (APEC) summit, Tai “also raised the status of the U.S.-Japan beef safeguard agreement and Japan’s ongoing review of its on-road ethanol use targets,” her office said in a statement.
Japan’s government has warned that the electric vehicle tax credits in the Inflation Reduction Act could deter further investment by the Japanese in the United States.
While we’ll have to wait and see regarding further investment from other industries, Japan’s automotive sector seems to have risen to the Inflation Reduction Act’s challenge. Not only has Honda committed to a massive North American EV investment, Toyota’s plotting a multi-billion dollar investment in American EV manufacturing and Nissan still has EV plans for its American manufacturing operations. In any case, it looks like allies may have found a bargaining chip that may lead to other trade concessions.
The Flush
Whelp, time to drop the lid on today’s issue of The Morning Dump. The Los Angeles Auto Show’s press day is officially over, so I’d love to hear what your favorite debut from the show was. Admittedly, it’s not a long roster of vehicles, but such is the nature of autoshows when manufacturers are happy to hold exclusive unveiling events so they don’t have to compete for views because media outlets aren’t spreading out resources to cover several new cars at once.
Lead photo credit: Land Rover
…if JLR wanted to hire *other* recently laid-off employees, too, (…hi) and Carvana pooping its pants causes Cayenne prices to drop……
COULD I FINALLY GET A CAYENNE?!
“Tech” worker here. (Though I hate the term. Regardless of context, can we all just agree that lumping large groups of people with diverse attributes together under one umbrella term is offensive?)
I’ve been looking for a job and looking to transition into automotive “tech” (do you even know what I do after that? NO!”)
It’s not just Jaguar. Ford is hiring big too. But you know what neither of them are doing? Paying anywhere near what people like me are already making. I mean… if you got laid off from Twitter and you are desperate for a paycheck (what were you doing with all that money?! Didn’t you save some!?) maybe you’ll take a job there and they’ll score a few employees at a bargain. But those people are going to be GONE as soon as the market settles and they can go back to making 75-100% more in a more traditional “tech” company.
Flush: Favorite dream car was the 911 Dakar, Favorite Car Car was the Prius Prime.
“GM might’ve found a way to shave $2,000 off the cost of each EV the automaker builds” Those cost savings seem to be coming from delivering what’s in demand so they can get full price. that’s not my idea of cost savings. That’s increasing ATP. It’s also delivering what the customer wants. I’m not mad, I just think it shouldn’t be confused with cost savings. I’d write “GM might’ve found a way to charge $2000 more per EV on average”.
I haven’t looked at any GM EV’s so I only have experience with their old products but I have to say that the thought of them decontenting/ cost saving $2,000 each on a car that has already been cost engineered to the skin of it’s teeth frightens me
I’m looking forward to JLR’s infotainment having a 128 character display spewing antisemitic BS other conspiracy theories at me. Maybe hating others will distract the owners from hating themselves for the purchase decisions they’ve made. Something to do while you are waiting for a tow I guess…
Based on their prior PR bullcrap and fantastic (s/) cash management I expect that Carvana will be burnt toast by mid 2023, unless a white knight comes along and saves the day. But hey, I’ll buy one of their stupid car vending machines. Looks like some sort of huge Japanese BnB.
Elon will buy them and that will be the end.
Obviously our boy Elon ain’t been getting laid in a long while. That must explain his sound financial purchases, as well as his good old boy attitude. Screw him and the Tesla he drove up in….just sayin’.
I can’t help thinking about the old joke that if Microsoft made cars you’d have to regularly open and close your windows and every so often it would just randomly crash for no reason.
If Twitter and Facebook made a car…it would probably be a Tesla, come to think of it.
If Twitter and Facebook made a car it would decide where you are going and what you are going to buy. As well as who your friends are and what your religion is.
So pretty much a Tesla then.
The Porsche 911 Dakar was by far the big winner for me. I would get way more usage out of it than I would the GT3 RS. We have a great gravel roads in the region and the added lift will make it much more usable in the snow when plows can’t keep up.
I’ve never wanted to hoon something so badly in my life
1st: Good. Now those engineers can write code to improve our vehicles, not more efficiently get us to buy more useless crap. Oh, wait, the automakers want us to buy more useless crap from inside the car. Maybe not so good after all.
GM’s cost savings definitely won’t show up in consumer retail pricing, as GM is currently taking a loss on their EVs and expects to do so until 2025. Assuming they ever do try to drop their prices, it almost certainly won’t happen until the cars are actually profitable. Right now, they’re just mitigating their losses.
It makes sense. There’s technie type work to be done in most companies — not just Twitter/Facebook/Amazon/etc. And if those big tech companies are letting people go, now is a good time for other companies to pick them up. I hope it works out well for all involved.
What is “techie type work” exactly?
If we touch a computer more than half the day we’re all the same to you people.
I’ll update my LinkedIn bio to “Computer Fondler”, inspired by your post. Thank you!
Do you expect people who aren’t in the hardware or software engineering fields to understand the diversity and details of technical roles?
The Genesis Convertible land yacht is the most interesting debut to me.
Flush:
The only reason I’d go to the LA Auto Show is to meet the Autopian staff and perhaps eat a shrimp from Jason’s wheelbarrow. I’m not interested in the new cars that much since all the screens and computers really detract from any “driving” experience.
*my cars are all old or weird*
Seeing Carvana go down, I’ve been checking their offer on my car, and it has dropped precipitously. I expected that, since they seemed to offer too much so much of the time. My pickup has stayed about the same, but it isn’t one they really wanted, anyway. Seems like dropping their offers is too little, too late, but I guess they’re trying.
They were offering people well over MSRP for used cars for a year, but I guess they were having trouble finding buyers to pay $10k over MSRP for a used car after their markup…
Flush:
Nope, not a single exciting or interesting reveal. With a single exception, I haven’t been excited for a new car introduction in at least a decade, maybe more.
The lone exception was the Maverick. I was really excited for a new, small truck with good fuel economy. I was very close to ordering one sight unseen. I saw my first stationary Maverick yesterday, and I’m glad I didn’t buy one. It’s huge in person. Specs say it’s only 10″ shorter than an F-150 RCSB, and that’s bigger than I care to DD.
The Maverick is also narrower than the F150 and not as tall. And the length difference is more significant if you compare to a quad cab F150. Would have been nice to get a single cab or at least an extended cab to make it shorter, but I still appreciate that they at least brought out something in a smaller pickup again.
But I agree that there hasn’t been much that’s super exciting lately. I’m hopeful about the upcoming hybrid Tacoma, but even that is just taking something that is good and popular and just improving it.
You’re not wrong, and I haven’t completely removed it from my short list. OTOH, it feels weird to order a vehicle I can’t see or touch, much less test drive. And knowing my order might (or might not) get built in the next 6 months, or a year, or not at all. It’s just a strange new world.
I had an order all lined out to get the Maverick at invoice price, but I wasn’t able to test drive a hybrid, and I thought I would miss my PHEV’s all-electric commute. I kind of regret it, but I am a little hopeful about a PHEV version or something that actually gets me excited coming later.
Stupidly, I ordered the Sportage PHEV to try to get in under the wire on the tax credit changes and get something with a little more hauling capacity than my Niro. Doesn’t look like it will arrive in time for me to be comfortable with my contract, so I’m back to waiting for something exciting.
Wow, I had the exact opposite reaction when I saw a Maverick in the wild. It felt tiny, I think mostly because the roof is so low.