Electric Bugatti: VW Group is giving up control of Bugatti to an electric supercar maker

7/6/21 8:00PM

Electric supercar company Rimac is set to take control of Bugatti, the brand owned by Volkswagen Group that is most famous for producing the Bugatti Veyron and Chiron — both of which are reportedly capable of reaching speeds in excess of 260mph.

This deal takes the strategic direction of Bugatti, which has long been a lossmaking business despite the eye-watering prices of its cars, out of VW Group's hands. With VW Group delivering 9-10 million cars per year, across a variety of brands, Bugatti has felt increasingly out of place. In 2020 it delivered just 77 cars, down 5 from the 82 it delivered in 2019, which is a number so small that it basically shouldn't show up at all in this chart of VW Group deliveries.

‍Better together

‍The new company formed is set to be called Bugatti Rimac, and it brings together a traditional and well established hypercar brand with the exact opposite — a scrappy electric vehicle start-up founded by an ambitious 23-year old Croatian called Mate Rimac who initially gained notoriety for his custom built electric BMW.

For VW Group, which has ambitious plans in mass-market electric vehicles, this deal is a clean way of passing operational control of a storied brand to a start-up that is embracing the challenge of building the next generation of electric supercars. For Rimac, it solidifies their pole position in the niche world of electric hypercars.

Hyunsoo Rim

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JetBlue is raising its bag fees as fuel costs squeeze airlines

JetBlue will reportedly hike its bag fees, as the cost of jet fuel continues to climb amid the war in Iran. It’s the latest example of carriers finding ways to push rising costs onto travelers.

Last week, United Airlines CEO Scott Kirby said that if fuel prices remain elevated, fares would need to rise another 20% for his airline to break even this year.

As CNBC reported, when one airline raises fees, others tend to follow.

Earlier this month, JetBlue hiked its first-quarter outlook for operating revenue per seat mile to between 5% and 7%, saying that strong Q1 demand helped “partially offset additional expenses realized from operational disruptions and rising fuel costs.” Now, the carrier appears to be making moves to further boost revenue to offset those costs.

Earlier on Monday, JetBlue rival Alaska Air lowered its Q1 profit forecast. The refining margins for the carrier’s cheapest fuel option — sourced from Singapore and representing about 20% of Alaska’s overall supply — have spiked 400% since February.

JetBlue did not immediately respond to a request for comment.