The American Car Market Is Basically Just SUVs Now

Good morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to read because cars are the greatest oh yes they are the greatest.

1st Gear: Land Luxury Everywhere

This year’s New York Auto Show (and it’s not over yet!) has been chock full of luxury SUVs because—newsflash—that’s what Americans want.

And this isn’t a just a short-term trend, The New York Times believes. With cheap gas and President Donald Trump pushing to loosen fuel economy regulations, automakers are “raising the stakes in the SUV segment.” From the story:

“We don’t think that the rate of growth of S.U.V.s will necessarily continue, but we do believe the shift to them is permanent,” said Mike Manley, head of Fiat Chrysler’s Jeep division.

Some of the newest S.U.V.s also cater to consumers interested in prestige, luxury, and, above all, comfort.

One such vehicle, Ford’s new Lincoln Navigator, is bigger and more powerful than the model it will replace, and is packed with features like a dial that selects from six modes set for varying weather conditions and terrain.

You should definitely go check out the new Navigator if you’re in town. It’s huge.

This trend has environmentalists worried. Although many automakers have committed to advancing the EV front, the truth of the matter is that they still sell way more SUVs than they do EVs.

2nd Gear: “Buy Ford,” Love, Elon

Yesterday, a group of investors made some noise about how Tesla should appoint two new directors to its board without ties to Elon Musk. Basically, they want anyone down to call out Elon and his sometimes fantastical ideas.

Elon wasn’t having none of that, according to Reuters. The CEO took to the Twitters to express his opinion:

A defiant Musk took to Twitter on Wednesday afternoon to suggest the investors buy stock in Ford Motor Co (F.N) instead. The Ford family controls the Detroit automaker through two classes of stock.

Oh, SNAP.

3rd Gear: First Volvo EV To Be Built In China

We saw some Volvo EV renderings last May and it looks like the first production examples will be built in China, reports Automotive News Europe, citing unnamed sources. Because, you know, Volvo is owned by Chinese company Geely.

It’s unclear which body style will be used, but it seems like the CMA platform will underpin these new EVs:

The battery-powered vehicle will debut in 2019 and will be exported globally. It will be based on the compact modular architecture (CMA) that Volvo co-developed with Zhejiang Geely Holding sister brand Lynk & CO, the sources said.

The electric car will be made at Volvo’s plant in Luqiao, southeast China, alongside CMA-based models such as the all-new XC40 compact SUV, which launches later this year, and Lynk & CO’s first model, the 01 crossover.

If everything goes smoothly, it looks like Volvo’s commitment to sell up to one million electric cars by 2025 is well under way. Whether or not it achieves this is anyone’s guess.

4th Gear: Fight For The Right For Autonomy

Nearly everyone in the automotive industry is trying to either get in or get ahead in the great race for autonomy. So, if you can prove that you know how to build or develop an autonomous car, you now find yourself in very high demand, reports Reuters. There are deals being made, I tell you!

Dealmaking in the automotive and technology industry is driven by the rapid transition of self-driving vehicles from research projects to major elements of near-term product plans at several of the world’s biggest automakers.

“Everybody is trying to understand what skill sets are required to be first in the game (and) if they don’t have it, they’re going to partner, invest or purchase,” said Xavier Mosquet, a senior partner at Boston Consulting Group and an authority on autonomous vehicles.

Hey, if competition drives innovation, then I’m for it.

5th Gear: Mercedes-Benz ‘Hmm’ About Diesels Now, Wonder Why

Earlier this month, we predicted that the death of diesel isn’t too far off, especially after that dirty thing Volkswagen did. And now it seems that Mercedes-Benz is iffy about resuming diesel sales in the U.S., writes Reuters:

The German automaker has not received approval from the U.S. Environmental Protection Agency to sell 2017 model diesel vehicles.

The EPA said in September 2015 that it would review all U.S. diesel vehicles following an admission from Volkswagen AG (VOWG_p.DE) that it had installed software in cars allowing them to emit up to 40 times legally permissible level of pollution.

In April 2016, the U.S. Department of Justice asked Daimler to investigate the emissions certification process for its Mercedes vehicles.

Dietmar Exler, president and CEO of Mercedes-Benz USA, told reporters at the New York auto show said the company’s engineers are in talks with EPA over the diesel vehicles. He said he was not aware of the status of those talks.

However! Mercedes has also said that it’s launching a strangely named EV sub-brand, under which it will reportedly build a lot of electric cars. Oh, and that Smart will no longer offer gas-powered cars in the U.S. and Canada after the 2017 model year and instead will go fully electric.

Hmm... no mention of diesel anywhere here in these fancy new future plans. It seems like Daimler’s mind is made up.

Reverse: “Houston, We’ve Had A Problem Here”

Neutral: Do you think EVs don’t sell as well as gas-powered SUVs because of range anxiety, infrastructure difficulties or because automakers just don’t make them as appealing? A combination of all three?