Do you see North America continuing to be McLaren's leading market?

I think it will be. I'm going to say forever, but that's an awful long time, so certainly for a long time. Just take the demographics, the wealth. It's almost a bit unfair when people say, "Which is the biggest market?" and I go, "Well, the U.S." Because it's kind of, like, of course it's the U.S. We would be doing something wrong if it wasn't. But right now, it's the U.S., the U.K., Japan, Germany, China. The U.S. is going to lead that picture for quite a time. It's a great market, a very healthy market. It's got a mature understanding of the type of product. It's got a lot of customers who love these kinds of cars. We've got excellent retailers here who know the market and know their customers. It's a good many years ahead of most of the other markets around the world.

What does the China market mean for McLaren going forward?

It'll grow steadily and slowly. The reality is that if you take the people with money in China, the generation that really first came into that kind of wealth pretty much [doesn't] buy our cars. They're delighted to be driven in saloons or SUVs, or they haven't got the bug for sports cars. It tends to be their sons and daughters. We're more selling to the second generation. One thing it does mean is our demographic in China is the youngest of anywhere in the world. Our customer age group is 25 to 28. It's unbelievable.

And female buyers as well; it's a very, very different mix in China. As that age group grows, I don't think they're going to lose their taste. They probably will still have their saloons and SUVs, but they'll have their sports cars because they love them. And people will come up behind, so I see the market in China growing for us but steadily over 10 years, 20 years. Heck, if we grew by 25 cars a year, I'd be happy. [It] sounds like tiny volume in the automotive sense, but we've gone from nothing in 2013 to about 350 cars. We've got a plan over the Track 25 period that takes us to about 500 cars, and that will be really strong.

How much of a challenge is brand recognition for McLaren?

It was our biggest challenge at one time, if I go back to when I joined in 2012. I remember doing a survey in the U.S. on purchases over $150,000 and saying to people: Name a supercar company. We were the bottom of the list. Then you'd say, "What do you associate McLaren with?" and they'd say Formula One. This was very true of brand awareness then.

We've come a long, long way from that time. But still, I don't think we have the brand awareness in our segment of some of the brands who have been around for 70, 80 years. Building that awareness is key.

I'm an engineer; I'm a production guy [at] heart, not a marketing guy, so I'm going to give you my theory on marketing. My theory on marketing, thinking back to when I did my master's, is still down to two very simple things. One is that you've got to get your name on the shopping list. And then secondly, when you're on the shopping list, you've got to have a reason for the customer to choose you. If we're on a customer's shopping list — if you say, "Hey, I'm going to buy a supercar; these are the five cars that I'm interested in" — if we're one of those five cars and you go try them, I think we've got an extremely high likelihood of you choosing our car.

The chances right now of being on that shopping list are the challenge because we're not as well-known as the established manufacturers. We're still a startup in some ways; we're still the new boy. People talk a lot about disrupters from a technology point of view, but we're a little bit of a disrupter in the supercar market.

Track 25 was an effort to explain what we are and where we're going. You don't have to tell people what your business strategy is. We wanted to because we wanted people to understand the company better. And so I think we've come a long way in six years, but it remains one of our key areas of focus.

What do plug-in hybrids mean for McLaren going forward?

They're essential. I don't know any other way to meet the emissions challenges that we all need to meet globally. What's being looked for in the U.S. isn't so different than Europe. China is probably pushing harder than anybody else, so the only way we can get down, below 100 grams of CO2, is going to be with hybrids and plug-in hybrids initially. We've proven in the Ultimate Series with the P1, the P1 GTR and Speedtail that actually a hybridized powertrain can bring advantages, not just in emissions.

We'll do our first series hybrid in the next couple of years, and that car will be a plug-in. It will have 25 to 30 miles of EV range. But most importantly, it will still be absolutely superb. It will be a better supercar than the one it replaces. That's the key — to combine all those things. I've driven the preproduction cars, and it's absolutely superb. It brings additional dimensions because you've got all the power and performance, more power and performance than the current range, but you have that EV capability if you want it. You can choose to start up in EV. My commute from my apartment to my office is 12 miles. I could do that on pure EV if that's what I wanted to do. It brings more breadth to the product. I find hybrid exciting; I find EV challenging.

What's the timeline for an EV from McLaren?

It's going to be very dependent on the batteries being right. I'm not going to be very precise. It's going to be between 2025 and 2030. But to put an exact year on it, I'd probably get it wrong. We need to get to a point where we can get the performance, the range, the recharge time and the weight. We need all of those. Because for us, if you think of it just as a power source, if somebody said, "Go make me an EV product," I can do that. And I'd make the best EV product possible, but it doesn't necessarily mean it's the best supercar. And the point for us is, it needs to be the best supercar.

In 2025, where do you see McLaren?

We've laid it out pretty much in Track 25. We will be — let me hedge my bets — somewhere between 5,500 and 6,000 cars. We'll see the GT range filling out a little bit and balancing our supercars, and we'll be staring at the next-generation P1, which will be again a real technology-leading car in that segment. We'll probably see the whole range hybridized. We possibly won't see an EV in there yet, but we may be in a good position to predict exactly when it's coming along. We'll probably have 100 retailers around the world and much better brand awareness because we'll continue to grow.

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VW Group Components was formed in January after a carve-out process that took more than three years to complete. It now incorporates nearly 80,000 employees across 47 global locations building everything from driveshafts and dampers to front axles and steering columns.

Traditionally, the parts arm's main task was manufacturing more than 10 million combustion engines and transmissions a year. But as VW shifts to electric powertrains, that volume will have to be completely wound down by around 2040 — without causing a sustained hit to earnings.

According to sources, VW Group Components earns, on average, an operating margin of 4 to 5 percent, depending on the product. A tenth of its work force is slated to be eliminated in the next four years to protect that profitability. But a labor pact in Germany means layoffs at its high-wage sites in the country are not an option through the next decade.

Schmall declined to confirm VW Group Components' margin but said his aim remains to achieve the strategic target margin set by his bosses: 6 percent.

While he predicted suppliers making the shift to EVs would find it difficult to boost returns to more than 10 percent, he said VW could rely on growing volumes to help it through the transition.

"By 2025, our site in Kassel plans to manufacture up to 1 million electric drivetrains, making us one of the largest suppliers in the market. With those kinds of volumes, you shape the global competitive landscape," Schmall said.

The VW manager plans to invest about $3.96 billion through 2023 in the business's EV component operations, but that means funds will be limited elsewhere. To address that challenge, he made a deal to combine VW's conventional steering business with Japan's NSK to share costs. This will allow the operation to focus on the steer-by-wire technology needed to address another megatrend: the move toward self-driving cars.

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Great Wall Motor Co., the only major domestic Chinese light-vehicle maker that has maintained sales growth this year, continues to build new production capacity in China.

It broke ground for an 8 billion yuan ($1.1 billion) vehicle assembly plant in Taizhou of east China’s Jiangsu province on Monday, the company said.

The factory, Great Wall’s eighth production site in east China, is slated to start output in Dec. 2020. It will build traditional and electrified vehicles for Haval, the company’s brand for mass-market crossovers and SUVs.

Earlier this year, Great Wall kicked off construction of plants in Pinghu of east China’s Zhejiang province and Rizhao of east China’s Shandong province. Both factories are expected to become operational in late 2020 or early 2021.

Great Wall now assembles vehicles in Baoding and Xushui of north China’s Hebei province, the north China municipality of Tianjin and the southwest China municipality of Chongqing.

It also expects to partner with BMW Group to build battery electric vehicles for its proprietary brands and the Mini brand in Zhangjiagang of east China’s Jiangsu province. But the joint venture agreement, signed in 2018, still needs to be approved by regulatory bodies in China.

In June, Great Wall opened its first overseas assembly plant in the Tula Oblast region of central Russia.

In October, the company’s sales rose 4.5 percent year on year to top 115,000 vehicles thanks to its expanded product mix.

For the first ten months, its deliveries rose 6.7 percent to approach 840,000. The number includes 687,884 crossovers and SUVs as well as 114,270 pickups.

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