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Daimler and Volvo could jointly develop internal combustion engines

BERLIN — Luxury German carmaker Daimler and Volvo, owned by China's Geely, are considering cooperating to cut the costs of developing combustion engines, a magazine reported on Sunday, citing unnamed company sources. The Automobilwoche weekly cited a Volvo manager as saying there were initial talks with Daimler, but no concrete plans, while a company spokesman said it was too early to talk about firm projects, although it was not excluding anybody. A Daimler spokesman said the company's cooperation with Geely, which owns a 10% stake in the German carmaker, was developing in a positive way, but declined to comment further. Global tariffs, accelerated by a trade war between China and the United States, as well as higher investment requirements for electric and autonomous vehicles, are forcing carmakers to seek new ways to cut and share costs. In October, Volvo said it would merge its engine development and manufacturing assets with those of Geely, creating a division to supply in-house brands and also potentially others with next-generation combustion and hybrid engines. Automobilwoche said this new division would start operating by the end of March, which could be a possible starting point for cooperation with Daimler, while a further step could be a partnership to develop electric power trains. Geely and Daimler have said they plan to build the next generation of Smart electric cars in China through a joint venture and the two companies are also cooperating on a premium ride-hailing service in China. Geely bought Volvo Cars in 2010 from Ford, allowing the Swedish brand to operate on an arms-length basis. But in recent years, it has deepened cooperation between the two brands. Volvo already supplies engines to some Geely-branded vehicles, sharing technology through Geely's Lynk brand. Both companies share and develop common vehicle platforms. Related Video: This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings.

2016 British Grand Prix kept mostly calm and carried on

Three bursts of chaos decided the course of the British Grand Prix. The first was a literal cloudburst a dozen minutes before the race, which poured water on the Silverstone Circuit while drivers sat on the grid. Six minutes before the lights-out, the race director decided to start the race behind the Safety Car. The field loped around the wet track for five laps. When the Safety Car pulled off, the three leaders – Mercedes-AMG Petronas' Lewis Hamilton, followed by teammate Nico Rosberg and Red Bull's Max Verstappen – stayed out. Behind them, the second chaotic moment occurred: a big group of drivers made pit stops for intermediate tires. When Manor's Pascal Wehrlein spun at Turn 1 on Lap 7, officials issued a Virtual Safety Car. With the rest of the field slowed down, the three leaders ducked into the pits on Lap 8 for intermediates. The fortuitous timing meant all three drivers rejoined the track in their original positions. By Lap 9, with racing resumed, Hamilton had a 4.9-second lead on Rosberg. From that point, even as the track dried, no one bothered Hamilton during what one commentator called "a measured drive." The Brit won his home grand prix, taking the checkered flag seven seconds ahead of Rosberg. Rosberg had to earn second place on track. The German's car didn't respond well to the intermediate tires, so Verstappen excecuted an outstanding pass on Rosberg on the outside through Chapel on Lap 16. After everyone switched to slicks, Rosberg's Mercedes reclaimed its mojo and the German hunted Verstappen down, passing the Dutchman on Lap 38. The final touch of chaos happened when Rosberg's gearbox threw a tantrum on Lap 47 of the 52-lap race. Rosberg radioed his engineer, "Gearbox problem!" His engineer replied, "Affirm. Chassis default zero one. Avoid seventh gear, Nico." The race stewards allowed the engineer's first two statements, but stewards said the instruction about seventh gear contravened the rule that "the driver must drive the car alone and unaided." After the race, officials added ten seconds to Rosberg's time, demoting him to third behind Verstappen. Rosberg's is the first penalty arising from radio communication restrictions. Unsurprisingly, Mercedes will appeal. At this year's Baku race the radio controversy stemmed from engineers refusing to tell drivers what to do. Now we know what happens when the pit wall gets loose lips.

Dealers mobilize to protect their margins from automaker subscription services

Six individual auto brands — Lincoln, Cadillac, Porsche, Mercedes, BMW and Volvo — have established or are trialing a vehicle subscription service in the U.S. Three third-party companies — Flexdrive, Clutch and Carma — run brand-agnostic subscription services. And three automakers — Mercedes-Benz, BMW, and General Motors — have also launched short-term rental services. Dealers, afraid of how these trends might affect their margins, are building political and lawmaking campaigns to protect their revenue streams. So far, three states are investigating automaker subscriptions, and Indiana has banned any such service until next year. It's certain that those three states are the first fronts in a long political and legal battle. Powerful dealer franchise laws mandate the existence of dealers and restrict how automakers are allowed to interact with customers to sell a vehicle. On top of that, Bob Reisner, CEO of Nassau Business Funding & Services, said, "Dealers and their associations are among the strongest political operators in many states. They as a group are difficult for state politicians to vote against." In California earlier this year, the state Assembly debated a bill with wide-ranging provisions to protect against what the California New Car Dealers Association called "inappropriate treatment of dealers by manufacturers." One of those provisions stipulated that subscription services need to go through dealers, but that item got stripped out when dealers and manufacturers agreed to discuss the matter further. In Indiana, Gov. Eric Holcomb signed a moratorium on all subscription programs by dealers or manufacturers until May 1, 2019, to give legislators more time to investigate. Dealers in New Jersey have taken their campaign to the state capitol, asking that the cars in subscription programs get a different classification for registration purposes. Automakers run the current subscription services and own the vehicles. Sign-ups and financial transactions happen online or through apps, leaving dealers to do little more than act as fulfillment centers to various degrees, with little legal recourse as to compensation amounts when they're called on to deliver or service a car. That's a bad base to build on for business owners who've sunk millions of dollars into their operations.