May 23rd, 2017 Car News of the Day: LeEco cuts 325 US jobs, Michigan to build connected highway

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【Summary】Car News of the Day for May 23rd, 2017.

Original Claire    May 23, 2017 3:49 PM PT
May 23rd, 2017 Car News of the Day: LeEco cuts 325 US jobs, Michigan to build connected highway

LeEco to lay off 325 people in U.S.

LeEco released in a conference call today that the company will lay off 325 employees in its U.S. office.

"While we've made progress in growing our distribution channels, the challenges with raising new capital have made it difficult in the past few months to support all of our business' priorities...this will impact approximately 325 people in the U.S." the company said in the statement, confirming the decision.

This is just three days after LeEco's founder Yueting Jia resigned as CEO of the company. The fast expansion plans of the company have created an awkward situation of cash shortage. The company has halted its purchase Vizio, and it is considering selling the land it purchased from Yahoo to easy the financial crisis. Nonetheless, the company said they will put their focus on Chinese speaking households in the U.S. by offering tailor-made products and content for the community.

Japanese automakers reach record high in R&D levels


According to Nikkei Asian Review, Japan's major carmakers are expected to spend a record high of $25.5 billion on research and development in 2017.

The R&D costs for Honda, Suzuki, Mazda and Subaru will all break records this year. Mitsubishi's R&D efforts are expected to climb by 20% this year alone.

As the world's third largest automaker, Toyota will spend over $8.96 billion in 2017, remaining with last year's budget level. The reason behind the continuous concentration in R&D is due to companies' efforts on green, autonomous driving and other emerging technologies. The auto industry accounted for 22% of R&D spending by companies in Japan in 2015, according to the Ministry of Internal Affairs and Communications.

Daimler unveils German battery factory to challenge Tesla


Daimler, the parent company of Mercedes-Benz, broke ground on its second battery plant in Kamenz, Germany yesterday. The new factory will serve as an important battery manufacturing center for Mercedes-Benz as the luxury carmaker prepares to put to market a series of electric vehicles in the coming years.

Daimler plans to start mass-production in new factory in mid-2018. The factory is expected to quadruple the manufacturing and logistics area in Kamenz to 80,000 square meters, which can potentially become one of the largest battery plants in the world, rivaling Tesla's $5 billion Gigafactory in the United States. Daimler has invested 500 million euros ($560 million) in the new plant, and $1 billion euros in global battery system production. The factory will help Mercedes to put forward more than 10 new electric passenger cars by 2022.

Michigan to build the country's first "connected highway"


The Michigan Department of Transportation and 3M are building up a three-mile stretch of I-75 in Oakland County with vehicle-to-infrastructure (V2X) technology. The project is intended to help pave the way for future autonomous and connected vehicles.

The road project is expected to take four months to complete, and will be used as a test bed for emerging transportation technologies. The installation and change on the highway will include roadside dedicated short-range communication devices, advanced all-weather lane markings, and retroreflective smart signs. These features will make it easier for human drivers and autonomous vehicle sensors to see and identify, thus increasing the safety of the vehicles.

Frontier Car Group collects $22 million to disrupt emerging market car sales


Berlin company Frontier Car Group, which builds marketplaces for second-hand vehicles in emerging markets, has recently raised $22 million of funding co-led by Balderton Capital, EchoVC+, and TPG/Satya.

The company is headquartered in Berlin, but has built local businesses led by elite operators in Chile, Mexico, Nigeria, Pakistan, Turkey and Indonesia. "Despite massive consumer demand, there is no good way for people to sell their cars efficiently for a fair price. Our vision is to reinvent how the used automotive sales sector works in global emerging markets through technology and infrastructure creation." Sujay Tyle, co-founder and CEO of Frontier said in a statement. The company said it will use the new funds to further expand its market share in the existing emerging markets.

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