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Archive for the ‘Lawsuits/Legal’ Category

Automakers on Edge Over Possibility of New Tariffs

Commerce Dept. findings key to Trump administration's plans.

by Joseph Szczesny on Nov.14, 2018

Commerce Secretary Wilbur Ross is leading the Section 232 investigation into whether or not imported automobiles and parts represent a threat to the United States.

While the U.S. midterm elections have passed, carmakers are waiting on a final decision from the Trump administration on the Section 232 investigation. Section 232 of the Trade Expansion Act of 1962 allows the White House to use national security grounds to impose tariffs on vehicles and auto parts imported into the U.S.

The industry’s lobbyists have said they were expecting the U.S. Department of Commerce, which is responsible for the investigation, to issue its ruling soon, perhaps this week well ahead of the February deadline fixed by the statute. The general assumption is the report will offer Trump a chance to impose new tariffs on autos and auto parts made in Europe and Asia.

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The 232 query has become a major issue for the Japanese government of Shinzo Abe, which has spent weeks trying to defuse the administration’s threat to impose tariffs that could have a major impact on the Japanese auto industry. (more…)

Faraday Future Insists it Isn’t Going Away

New plan calls for leaner management, second product, even an IPO – if it can stay in business long enough.

by Paul A. Eisenstein on Nov.14, 2018

In better days: Jia Yueting and Nick Sampson, helped unveil the FF91 at the 2016 CES.

Only a matter of weeks ago, battery-carmaker Faraday Future seemed ready to turn out the lights, co-founder Nick Sampson resigning and then declaring in a blog post that the company was “effectively insolvent.” But, despite a seemingly endless series of crises, including one that forced it to cancel a planned assembly plant in Nevada, Faraday’s new management team continue to project a surprisingly bullish take on their future.

Late Tuesday, in fact, the California-based company released a statement outlining its plans for the future, which included a new, “lean management” structure, and “fortified product plans” that not only include the original FF91 supercar but a second, more mainstream crossover.

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Of course, there is the minor issue of finding the necessary cash. Faraday’s latest crisis was kicked off when China’s Evergrande Health Industry Group backed out of a deal that was supposed to generate as much as $2 billion in capital. For the moment, the automaker says it is on the hunt for $500 million to get it back on track.

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Former Tesla Employee Allegedly Embezzled $9.3M from EV Maker

Parulekar allegedly used suppliers to abscond with cash.

by Michael Strong on Nov.12, 2018

A former Tesla employee allegedly embezzled $9.3 million from the company.

A former Tesla Inc. executive was indicted by a federal grand jury indicted for allegedly embezzling $9.3 million by impersonating an employee at a supplier.

According the indictment, Salil Parulekar got Tesla to send money owed to one supplier to another supplier. Once the money was moved, by impersonating an employee at that company he shifted the money into his account.

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Parulekar, who worked for Tesla for four years until 2017, was responsible for overseeing Tesla’s relationship with certain suppliers for various parts and services related to the company’s electric vehicles, according to the Justice Department. (more…)

Denholm Replaces Musk as Tesla Chairman

Appointment could be temporary, as Musk can regain post after three years.

by Paul A. Eisenstein on Nov.08, 2018

Australian Robyn Denholm will succeed Elon Musk as Tesla's chairman, though he remains CEO.

Australian Robyn Denholm is Tesla’s new chairman, replacing Elon Musk as head of the board of directors following a settlement with the Securities and Exchange Commission that forced the South African-born exec to relinquish his role.

Musk, who will remain chief executive officer of the battery-carmaker, can attempt to regain the chairman’s post, as well, after a three-year hiatus mandated by the SEC settlement. The agreement was reached after the government accused the 47-year-old of lying to investors when, last August, he declared that he had arranged funding to take Tesla private.

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The move will position Denholm as one of the highest-ranking female executives in the auto industry, with General Motors’ Mary Barra the only other woman serving as chairman of a major car manufacturer. Denholm had already been serving as an independent director on the Tesla board since 2014. There is one other woman on the board. (more…)

More UAW, FCA Officials Sentenced in Bribery Scandal

Borman declared no leniency for defendants.

by Joseph Szczesny on Nov.07, 2018

The UAW long tried to maintain a squeaky clean reputation, but the scandal has sorely tarnished its image.

Two former Fiat Chrysler Automobile N.V. officials and one former leader of the United Auto Workers have been sentenced to prison terms, ranging from 12 months to 15 months, for their part in a conspiracy to violate federal labor law.

The sentences imposed on FCA’s Michael Brown and Jerome Durden as well as the UAW’s Keith Mickens come more than two years after the federal government announced indictments triggered by a scheme in which FCA officials used subterfuge to bribe union officials in a bid to secure labor peace.

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Former FCA Vice President Alphons Iacobelli, a central figure in the case, was sentenced to five and a half years in a federal prison, while Monica Morgan, the widow of former UAW VP General Holiefield, one of the central figures in the scheme, was sentenced to 18 months prison earlier this year after pleading guilty to federal tax charges.

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U.S. Regulators May Force GM to Expand Wiper Recall

Initial action taken in 2013 covered about 370,000 vehicles.

by Michael Strong on Nov.06, 2018

GM may be forced to recall an additional 1.7 million SUVs due to a faulty windshield wiper.

General Motors is under investigation by U.S. safety regulators that are considering forcing the company to expand a windshield wiper recall to cover 1.7 million additional sport-utility vehicles.

The company recalled 368,000 Chevrolet Equinox and GMC Terrain SUVs for the 2013 model year. The government is mulling having the expand the action to include vehicles from 2010 through 2016, according to multiple reports.

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GM issued the initial recall of the SUVs in August 2016 because the wipers could fail. Water and other debris could get into the wiper assembly ball joints, leading to wear and eventual joint failure. (more…)

Where is a Vehicle Most Likely to be Stolen? Depends on Where You Live

It's less likely to be nabbed in a large downtown than you think.

by Michael Strong on Nov.06, 2018

The Honda Civic is the most stolen vehicle in America, but where you live is a big determiner of how likely it is to be stolen.

After a 7% spike in auto thefts in 2016, the number remained flat in 2017 when 773,139 cars, trucks, SUVs and crossovers of all types were stolen.

There are a variety of reasons why a vehicle may get stolen: the ease with which it can be gotten, popularity of the vehicle, and more.

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Everyday drivers like the Honda Accord, Honda Civic, and Chevrolet and Ford pickup trucks are by far the most stolen vehicles in America. This is especially true of older models without modern security features. (more…)

Uber Aiming to Relaunch Autonomous Testing on Public Roads

After fatal crash, ride-sharing service plans to redouble steps to ensure safety.

by Paul A. Eisenstein on Nov.05, 2018

In the wake of a fatal collision with a pedestrian in Arizona, Uber suspended all of its autonomous vehicle testing. Now it wants to resume in Pittsburgh.

Uber plans to relaunch the autonomous vehicle testing program it suspended following a fatal crash in Arizona last March, but it has advised regulators in Pennsylvania that it will take additional steps to ensure the safety of its vehicles.

The San Francisco-based ride-sharing service has been betting heavily on fully driverless technology, hoping it will lower costs to the point where many Americans won’t even feel the need to own a private vehicle anymore. But that effort was put on hold after a modified Volvo struck and killed Elaine Herzberg as she crossed a road in a Phoenix suburb.

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It was initially unclear why the Volvo hit the 49-year-old Herzberg, as its system spotted her six seconds before impact. It was subsequently revealed during a police investigation that the backup driver charged with taking control in an emergency was actually streaming the TV show, “The Voice,” rather than watching the road. She failed to intervene when the car’s brakes weren’t automatically applied because of improper modifications made to the vehicle. (more…)

Tesla Hit with Three Subpoenas by SEC

EV maker reveals new info in quarterly filing.

by Michael Strong on Nov.02, 2018

Tesla CEO Elon Musk's was subpoenaed by the SEC related to the plans to take Tesla private.

Just days after telling the world they had not been served with any subpoenas regarding its predictions or discussions about production of the Model 3, Tesla Inc. officials said they’ve been served with three of them.

That was Oct. 26, but in its quarterly filing with the SEC dated Nov. 2, things had changed.

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In the filing, the company said it was served with three subpoenas by the Securities and Exchange Commission. The company notes that no government supervisory or law enforcement agencies have found them guilty of anything. (more…)

Subaru, Toyota Recalling 165,000 Cars Due to Engine Stalling

A valve spring is root of the problem.

by Michael Strong on Nov.02, 2018

The 2012 Subaru Impreza is part of a recall of 165,000 cars in the U.S. due to a problem that could cause the engine to stall.

Subaru and Toyota partnered up to build engines and now they are partnering on a recall of about 165,000 U.S. vehicles to resolve an issue causing those engines to potentially stall.

The action covers about 140,000 Subaru vehicles in the U.S. and about 25,000 of Toyota’s now-defunct Scion brand vehicles.

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“There is a very small possibility of a valve spring fracture in a very small number of affected vehicles, which could lead to engine noise, malfunction or, in a worst-case scenario, an engine stall,” Subaru said in a statement. (more…)