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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.

Researchers halfway to cutting carbon fiber costs by 90%

Carbon fiber has been utilized for decades to build racecars, as a means to cut weight while maintaining strength. But until recently, the space-age material has been largely absent from the street on anything but supercars because of the expense to use it. Recently, BMW signaled a major shift in that trend when it starting using carbon fiber reinforced plastic panels on the i3 and i8. This relatively small scale start might be just the beginning; the German company believes that a breakthrough to inexpensively manufacture the lightweight stuff is just on the horizon.
MAI Carbon Cluster Management GmbH counts BMW, Audi, Airbus, the German government and many other organizations as supporters, and it's researching how to make carbon fiber cheaper to produce, according to Automotive News Europe. The company thinks it can reduce costs by 90 percent in the near future. "We've certainly reached a halfway point on our cost-cutting target for suitable carbon-fiber parts," said project head Klaus Drechsler to Automotive News Europe.
Unfortunately, it isn't entirely clear just what MAI Carbon is doing to make such a huge leap possible. However, a recent post on the company's website talks about a new form a carbon fiber using a thermoplastic matrix that could be cured in less than three minutes. That's compared to about 90 minutes in the traditional process with an autoclave.

Buy this Munro report, get a free BMW i3

Here's an offer we've never heard of: if you buy the Master- or OEM-level version of a detailed production and cost report on the BMW i3, the engineering firm that produced the report will give you a 'free' i3. Munro & Associates is the company behind the study and the offer, its comprehensive breakdown of the production realities involved in the i3 including a video of the disassembly process of the range-extended hybrid and a detailed analysis of every part therein - everything from fuse boxes to crossbar beams, headlights and the battery pack. You've only got a day to take advantage, though - the report has to be purchased by the time CEO Sandy Munro gives his talk, "Deconstructing the BMW I3: Groundbreaking Technology and the Composite Car," in Detroit Wednesday morning. The price of said report? That's "TBD," so head to the Munro site if you're tempted by the idea of a new car that comes with a trunk full of paperwork. We just hope they're not selling the i3 that they tear down. The press release below has more information. Munro to Give Away 2014 BMW i3 with Every Purchase of the Consulting Firm's Master Teardown Report When Purchased at Two Upcoming Detroit Events DETROIT, Jan. 8, 2015 /PRNewswire/ -- Visitors to the North American International Auto Show (NAIAS) during Preview Week often go home with a lot of swag and trinkets, but how about a $50,000 BMW i3? This year, a local engineering firm, Munro & Associates, is giving away a BMW i3 electric car with every purchase of the Master-/OEM-level version of its benchmarking study of this unique vehicle when purchased during NAIAS or the Plastics in Automotive Conference. The study, the most extensive of its kind, details the production and costs of every system in this carbon-fiber electric vehicle, which CEO Sandy Munro calls the most advanced vehicle on the planet. WHO: Munro & Associates, the global leader in manufacturing, costing and benchmarking. Using its proprietary advanced design, quality and costing software, Munro developed comprehensive reports on key vehicle systems and – for the first time – will offer the reports for general distribution. WHAT: A FREE 2014 BMW i3 for anyone who purchases the Master-/OEM-level report during Preview Week of NAIAS or during Sandy Munro's presentation at the Plastics in Automotive Conference.