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The AutoGuide News Blog is your source for breaking stories from the auto industry. Delivering news immediately, the AutoGuide Blog is constantly updated with the latest information, photos and video from manufacturers, auto shows, the aftermarket and professional racing.
 |  Apr 03 2012, 2:32 PM

At least that’s the news according to statistics released by the two American automakers. Chrysler said it sold 34 percent more vehicles this March, versus the same period last year, delivering some 161,381 cars and trucks, versus 121,730 in March 2011.

Jeep and Ram truck demand was particularly strong, with gains of 35 and 22 percent respectively. Ford said it had seen sales grow by some five percent with sales reaching 222,884 units last month versus 212,295 in March 2011.

Despite declines in Buick and Cadillac sales, General Motors said it had seen overall demand grow by 12 percent in March to 231,052 units, largely fuelled by sales of small cars. Don Johnson, GM’s vice president of US sales remarked that,”the economic recovery and a deep bench of fuel-efficient cars and crossovers have been driving our sales for more than a year, but the combined impact has never been stronger than it was in March.”  The General said it sold a record 100,000 vehicles last month that get at least 30 miles per gallon on the highway.

A number of analysts believe the growth in auto sales last month can be partly attributed to this year’s unseasonably mild winter, which had consumers flocking to dealers earlier than the traditional spring selling season; other factors include a plethora of new models hitting the streets as well as lower unemployment statistics and easier access to credit for many.

Many industry observers are keeping a close eye on gas prices to see if they have an effect on auto sales this year; as currently they’re around the $4.00 gallon mark, traditionally seen as the tipping point which consumers change their car buying and driving habits.

Nonetheless, the outlook remains generally optimistic. “Barring any future shock related to geopolitical issues in the gulf region and further upward pressure on the price of oil, we believe sales will continue on a solid pace for the balance of the year, said John Humphrey” J.D. Power and Associates senior vice president of global operations.

[Source: New York Times via Auto News]

 |  Mar 08 2012, 2:31 PM

CN010_001FT.jpg
A few years ago, Italian auto giant Fiat was very close to partnering up with General Motors. However, that deal went sour at the last minute and a few years after that, Fiat bought a big chunk of Chrysler in its quest to have a large slice of the American market.

More recently, the company was in the news announcing that Fiat is looking to partner up with Mazda or Suzuki, which would not only help expand Fiat’s reach into the Asian market, but also co-develop future small car platforms and technologies together.

Not content with sitting idling by, waiting for deals to happen, Fiat/Chrysler are constantly seeking alliances to further its growth.

The latest round of news from the 2012 Geneva Auto Show is that Fiat is “open to Volvo talks.” Fiat boss Sergio Marchionne expressed that he is “interested in talking to everyone that wants to talk with me.”

Volvo, which is now owned by the Chinese auto firm Geely, wants to expand itself in the small car segment in developing markets which makes Fiat an good fit because it already has plenty of small cars in its line-up. This tie-up could prove very beneficial for Volvo, to offer a new small car, without going through the expense of designing and engineering a complete new vehicle itself.

Fiat will benefit by finding a route into the Chinese market, which is currently the fastest growing economy in the world.

As for future drive-train technologies, Marchionne says; “There’s still lots of unexplored technology with combustion. Future drive-trains need to be cheaper and more cost effective.”

While Fiat is to introduce its first electric car later this year, the 500e (shown above), it only did so because it pooled technology from a host of companies already in the electric car field and thus saved cost of developing a complete new system themselves.

When asked if Fiat was in talks with PSA Peugeot Citroen, Marchionne denied the claim saying, “I would not like to be GM. The integration for the cost does not go far enough and would not have met our requirements.”

Fiat was at one point in talks with GM to take over Opel-Vauxhall and Saab, and Marchionne confidently said he could have “found a solution for the brands.”

Will Fiat and Volvo become partners or will they form an alliance with Mazda or Suzuki? Only time will tell.

[Source: Autocar]

 |  Feb 22 2012, 4:32 PM

We’ve already got the Renault/Nissan Alliance, so why not a General Motors/ PSA Peugeot-Citroen one? Well according to PSA Chief Executive Philippe Varin that might just be a possibility, at least from a manufacturing standpoint.

Varin says that PSA is currently in talks with General Motors, discussing the possibility of GM teaming up with the French automaker to help stem the latter’s stagnant sales in Europe (on which it heavily relies) as well as helping reduce manufacturing costs.

The idea is to see both automakers develop and manufacture cars and powertrains through a joint effort in Europe, though each manufacturer would retain its separate branding, marketing and distribution network.

This is seen as adding benefits to both PSA and Opel, GM’s  European arm which, like Peugeot, is currently struggling to compete against giants like Volkswagen and Renault, thanks to high labor costs and limited manufacturing capacity.

The venture will also give Peugeot improved access to overseas markets such as China and South America; it could possibly even witness a return of the brand to the US for the first time since 1992.

However, any joint venture between the two companies will have to receive the blessing of the Peugeot family, which still controls some 30 percent of PSA stock. In addition with failed merger talks between Peugeot and Mitsubishi still relatively fresh on some minds, Varin is understandably cautious about any future alliances, though with European sales dropping by 8.8 percent last year and Peugeot stock halving in value over the last 12 months, any joint venture would certainly be welcome news.

In the meantime while discussions take place, Peugeot is doing what it can to weather the current economic storm, Varin having recently announced that the company will be selling some 1.5 billion euros ($1.98 billion) in assets to help alleviate debt, which currently stands at around 3.4 billion euros ($4.5 billion).

[Source: Auto News]

 |  Feb 06 2012, 5:45 PM

In the auto business, 2011 proved to be the year of the Koreans; both Hyundai and affiliate Kia sold a record number of vehicles, while their shares outperformed those of other automakers, including the likes of heavyweights such as General Motors, Toyota and Volkswagen.

That said, some of the sales in new vehicles from the Koreans actually cannibalized others within their ranks, notably the Kia Optima (K5 in South Korea), which after its latest redesign saw orders triple, though some of that came at the expense of Hyundai’s Sonata, which only saw demand increase by some 5.2 percent in the same period.

There’s every chance the same thing could happen again with Kia planning to launch the more upmarket K9, designed to go after the same customers as the Hyundai’s Genesis and Equus.

Frank Ahrens, a spokesman for Hyundai said the car-to-car rivalry between the two brands extends to all segments. Further complicating matters is the fact that although Hyundai and Kia are overseen by the same chairman (Chung Mong Koo) and share a development center, they are run as two separate companies and arch rivals at that.

There’s no question that Hyundai’s original 51 percent purchase of Kia Motors back in 1998 rejuvenated the brand and helped it grow into a purveyor of world-class vehicles with competitive prices. All the same, the companies need to sort out their differences now more than ever because it seems global competition is going to intensify in 2012 especially with Honda and Toyota returning to pre-disaster capacity.

This will likely mean Hyundai and Kia will need to develop a successful alignment strategy for their respective product lines, for example: focusing one brand on premium products and the other on volume sales. In doing so, they stand a greater chance of stealing sales from Japanese, American and European rivals instead of each other.

It seems that signs of greater product differentiation between Hyundai and Kia’s offerings are afoot; Kia’s European COO, Paul Philpott, said during a recent interview that “Hyundai will become the mainstream brand with Kia [functioning as] the sportier, dynamic little brother.”

[Source: Bloomberg]

 |  Feb 03 2012, 4:00 PM

Dany Bahar, the current CEO of Lotus is reportedly looking for a buyer to purchase the company from current Malaysian parent Proton.

Given that Proton itself was recently acquired by Malaysian conglomerate DRB-Hicom, the reason for Bahar’s strategy is probably the fact that DRB has little interest investing in a small volume specialty sports car brand, especially since Lotus hasn’t earned a profit since being originally acquired by Proton in 1996.

At present, Lotus requires funding of around £500m ($790 million) for the development of future street cars, which includes new Elan, Elise and Esprit models.

So far, no offers for purchasing Lotus have been confirmed, though some sources say that Genii Capital, the international investment firm which currently owns the Lotus Formula 1 Grand Prix team, would seem the most likely scenario, though reportedly a number of Chinese companies have also expressed interest.

[Source: Auto Express]

 |  Feb 01 2012, 11:45 AM

It seems, from a financial standpoint, things are getting better for Chrysler Group.  The company reported a total net income of some $183 million last year.

This money earned, included a $551 million loss, required to service outstanding debts (namely repaying the money it owed to the US Treasury and Canadian governments in full, some six years ahead of schedule and we might add, with interest).

Considering that a year ago, Chrysler reported a net loss of $652 million and that 2011′s income exceeded estimates, the report represents rather good news.

In fact, in the fourth quarter of 2011 alone, Chrysler earned some $225 million (versus a loss of $199 million in Q4 2010) even though it’s been introducing a number of new or significantly refreshed vehicles, programs, which tend to eat up considerable resources.

As of this month, Chrysler has achieved all the goals laid out two years ago following the companies restructuring. This, plus performance resulting from transactions, has led Fiat S.p.A,to increase its stake in the company to some 58.5 percent.

Upon the announcement of  Chrysler’s 2011 earnings, Chairman and CEO Sergio Marchionne (shown above) declared, “the house is in good order. We are proud of the work we’ve done. Now we greet a new year of high expectations with our heads down, forging ahead and focused on executing the goals we’ve set for ourselves as a company.”

 |  Jan 25 2012, 5:00 PM

Not since the original 1978-81 M1 (shown) has BMW‘s performance division offered a bonafide supercar, yet as the performance envelope is pushed further with the division’s other offerings, the idea to launch a halo, bespoke model has been gaining traction.

Yet, despite enthusiasm from within the ranks of M division, including development boss Albert Biermann, it’s currently proving tough to convince management at BMW itself to green light such a project. Currently, the resources are available to build the car but it simply isn’t considered a profitable exercise especially given BMW’s current business strategy which requires that each model in the product portfolio make money.

“We have the skills and we’d love to do it,” Biermann said recently. “We’ve discussed it several times but  [so far] we’ve never been able to make the business case.”

[Source: Autocar]

 |  Jan 23 2012, 4:30 PM

Along with the Saab saga, the story of VW‘s attempt to buy Porsche AG has been nothing short of a soap opera, with twists and turns at every juncture. After previous attempts by the Wolfsburg automaker to purchase the remaining shares in the smaller Stuttgart concern fell through, it now appears, the deal may be on again.

Both automakers have talked about consolidation for years, yet when former Porsche CEO Dr. Wendelin Wiedeking’s attempt to buy a larger stake in VW fell through, the tables turned; thanks to German law that required Volkswagen to buy shares in Porsche instead.

However, despite VW currently owning more than 49 percent of Porsche and the two companies sharing an upper management structure, there’s still little in the way of cohesiveness when it comes to operations, each firm doing its own thing when it relates to aspects such as R&D, engineering, manufacturing and sales and marketing. This is something that’s proving particularly troublesome, especially for strategic projects, such as upcoming EV vehicles and new lightweight sports cars.

Now, it appears that greater integration between the two companies might finally become a reality this year, information leaked by sources at VW suggest that Porsche has put in an option to sell its remaining 50.1 percent of shares this November.

If that does come to pass, Volkswagen could purchase Porsche outright by the end of the year, however German tax complexities mean that if an outright purchase were to take place before VW can exercise its own call option on the remaining shares (which would be March at the earliest) the merger would be subjected to higher taxation, not something that either company wants.

Martin Winterkorn, CEO of Volkswagen and Porsche, is clearly frustrated at the present lack of integration between the two companies, something he reiterated earlier this month at the North American International Auto Show in Detroit.

“We want to cooperate with Porsche in such a way that as many synergies can be leveraged as soon as possible,” he said, “without needing to have a lawyer stand next to a Porsche employee every time he screws something into a Volkswagen or vice-versa.”

[Source: Reuters]

 |  Jan 05 2012, 12:45 PM

Despite all the current hype surrounding Electric Vehicles and the seemingly huge amount of money some automakers are investing in them, a recent survey among global auto executives by consulting firm KPMG revealed that most are skeptical about the future success of EVs.

In fact among the 200 executives surveyed anonymously, two-thirds predict that sales of both Hybrid and pure EVs will only account for around 6 percent of total vehicle sales in Europe and the US by 2025. Nonetheless, it appears a large majority still think automakers will continue to invest large in EV technology, regardless.

Around 81 percent of those surveyed said they anticipate larger investments in battery technology for EVs, some 85 percent predict more investments in electric motor development, while 76 percent see greater resources being allocated to electronics designed for EVs.

From the results of the survey, Gary Silberg, KPMG’s national auto industry leader believes that many automakers are “hedging their bets. They are saying that we don’t know yet what the winning vehicle technology will be for the future, and so they are going to invest in all of it and let the market decide.”

Besides EV technology, the survey also revealed that many executives, from different parts of the world, believe that Chrysler and Ford Motor Company will gain global market share over the next five years, 47 percent predicting Ford’s market share will increase, while 31 percent believe Chrysler will show gains.

According to Silberg, these findings are indicative of a more positive public perception of both companies, which will translate into greater global sales and market share.

[Source: Automotive News]

 |  Dec 30 2011, 5:45 PM

For the first time since 2007, just prior to the US economy tanking, and with things still spluttering along on many fronts, the new numbers are very encouraging from America’s second largest automaker.

As for where the biggest gains have been, Ford is reporting healthy demand for small cars, such as the B-segment Fiesta and the larger C-class Focus (shown), which look to post sales increases of some 20 percent for the year.

Light trucks have also been doing well, with the breadwinning F-150, along with the outgoing Escape and Explorer looking to post strong gains (current estimates predict around a 30 percent increase by the time all’s said and done), according to an official statement released by the company.

According to Ford’s US vice president for sales and marketing, Ken Czubay, “the industry sales rate has exceeded 13 million in each of the last three months.” He also believes that “the current momentum is not an aberration.”

Let’s hope he’s right. So far, following the announcement, investors seem to agree, as Ford stock rose 0.5 percent to $10.73 today, reversing a trend that has seen shares fall more than 30 percent so far this year.

[Source: The Detroit News]

 |  Dec 30 2011, 3:00 PM

With court appointed administrators having taken over the remnants of Saab following the automaker’s bankruptcy, exactly what to do with the company’s assets is still very much an ongoing process.

Recently, Bloomberg reported that among the suitors interested in acquiring Saab assets, which so far have been Zhejiang Youngman Lotus Automobile Co. Ltd  and the Turkish government, Mahindra & Mahindra, the giant Indian conglomerate, has now also stepped forward.

Reportedly, talks are underway between Mahindra & Mahindra and Saab’s administrators. So far, as to which Saab assets are up for grabs, little has been revealed with Mahindra & Mahindra in particular remaining very tight lipped on the matter.

In addition, the same sources have reportedly said that despite these discussions, talks between the administrators and the Turkish government remain ongoing as well since Turkey has expressed interest in launching it’s own domestic vehicle brand. At present, acquiring Saab assets in order to do so appears to be the most logical step for the Turkish Government.

[Source: Bloomberg]

 |  Dec 23 2011, 7:45 PM

You’ve probably been noticing that fuel prices have been creeping up lately, as usually jittery investors see signs that the economic outlook is improving.

In the automotive sector there’s also some positive news; JD Power and Associates, along with the LMC Authority, are predicting that new vehicle sales in the US will reach 13.4 million this month, up from 12.7 million in December last year, this despite a reduction in sales incentives to move metal during 2011. Current estimates from both groups predict even stronger demand in 2012, with current projections set at some 13.8 million units.

“For the third straight time, light-vehicle sales are posting strong selling rates at the close of the year,” remarked Jeff Schuster, LMC’s senior vice president.  ”Next year, the automotive industry will look to build upon the strong finish to 2011, but the real test in 2012 will be weathering a summer selling slowdown and posting a full year of a progressive recovery,” he said.

[Source: Automotive News]

 |  Dec 21 2011, 3:30 PM

Like many luxury automakers these days, Cadillac is looking to capitalize on the perceived growing affluence of consumers in China.

To that end, GM’s luxury division plans to introduce several new models in an effort to better compete with the German triumvirate of Audi, BMW and Mercedes-Benz, which have so far, witnessed strong sales increases in recent years.

Like many automakers peddling vehicles in China, Cadillac’s goals are rather ambitious. Kevin Wale, who head’s up the brand’s operations in that country, said at a recent press conference in Shanghai, that the brand plans to boost Chinese production by some 40 percent in the next two years.

“Luxury-car sales will continue to grow faster than the overall passenger-car market, driven by increasing wealth,” said Wale. And perhaps he’s right.

According to data released from research firm LMC automotive, China is currently poised to overtake Germany as the world’s second largest market for luxury vehicles by next year.

That said, overall vehicle demand in China has been slowing in recent months November deliveries saw the smallest monthly gains in the second half of 2011, rising by just 0.3 percent over October.

[Source: Automotive News]

 |  Dec 20 2011, 11:15 AM

Saab bankrupt

Despite being officially declared bankrupt, Saab still has organizations willing to snap up the remnants, as the former Swedish carmaker goes into liquidation.

It’s probably not surprising, but considering the money it’s already put out to try and save Saab, China’s Zhejiang Youngman Lotus Automobile Co. Ltd, is still interested in acquiring what assets it can, which, according to a spokesman, primarily concerns the Phoenix platform which would have formed the basis for the next generation 9-3, along with other technologies that didn’t hinge on General Motors (part of the reason for Saab’s bankruptcy was GM’s refusal to allow Youngman to acquire the brand, fearing technologies it had invested with the Swedish automaker could end up in Swedish hands).

Yet another suitor comes in the form of the Turkish government. While it is very unlikely Turkey would want to build Saabs per se, the country already boasts a number of assembly plants belonging to foreign automakers, but until now hasn’t had a real domestic brand. If the government is able to acquire Saab assets, including the much valued Phoenix platform, then the Saab 9-3 might live on after all, though under a different name.

Given the twists and turns that have occurred with Saab since its independence from GM, what happens next at this point is anybody’s guess.

[Source: Left Lane News]

 |  Dec 13 2011, 5:15 PM

In yet another twist to the ongoing Saab soap opera, the Swedish automaker has received a payment from Zhejiang Youngman Lotus Automobile as it struggles to stay solvent. The payment, which is some $5 million will be reportedly be used to cover outstanding tax expenses.

Following on from that, Youngman, which is looking to take a significant stake in Saab, apparently plans to pay out more money by the end of this week, (some 20 million euros/$26.4 million), in this case to cover unpaid salaries. A spokesman for Saab, Eric Geers, confirmed that while the first payment had been received, nothing else could be confirmed, except the fact that talks with Youngman are “ongoing.”

Saab has been struggling to stay afloat ever since it was purchased from General Motors by Spyker and it’s main assembly plant in Trolhattan, Sweden, is currently idled in the wake of unpaid bills. In recent months the firm, owned by Swedish Automobile has sought creditor protection as it looks to find suitable investors.

Youngman has repeatedly tried to buy into Saab, but the latest deal was vetoed by General Motors, which still owns licenses for Saab technology. In the meantime Saab, still under creditor protection is under increasing pressure by the administrator overseeing the process, to have it’s protection agreement terminated.

A distric court in western Sweden, has given the automaker and its creditors, until Thursday this week to submit their views regarding the matter. A final decision on Saab’s status is expected to be made on December 16th.

[Source: Reuters]

 

 

 |  Nov 02 2011, 4:30 PM

 

With China seen by many as the future in terms of greatest sales potential when it comes to consumer goods, many organizations are looking to establish a stronger presence in the region.

Infiniti recently announced that it is putting plans in place to relocate it’s global headquarters from Yokohama in Japan, to Hong Kong, which is currently a special autonomous region of China.

The move comes as Infiniti makes plans to increase global sales to some 500,000 units annually, with the greatest gains likely in China and other South East asian markets.

Andy Palmer, executive vice president at Nissan Motor Co Ltd, stated in reference to the move that “as Infiniti grows its presence in the global luxury markets of North America, Europe, China and South East Asia, we selected Hong Kong as the optimum location for our new global Infiniti headquarters. We see an opportunity to reinforce Asian hospitality within the Infiniti brand, distinct from both Nissan and our facing luxury competitors.” He also added that Infiniti is ” proud to be the only automaker that will call Hong Kong home.

Alongside the new Infinti HQ, Nissan will also set up a new corporate office in the same location, with a target of both facilities becoming operational in April 2012. For more information, click below:

 

 |  Nov 01 2011, 1:15 PM

It’s been a leaky autumn so far in the motoring universe. Supposed actual pictures and specs have been “leaked” on Toyota’s upcoming FT-86 coupe (FR-S to us in North America); as well as details on Honda’s new generation CR-V crossover.

Now, Saab has joined the fold, with a picture uncovered by Swedish website SVD Näringsliv, which reportedly shows the next 9-3. The image was originally part of a presentation which Saab gave to the European Investment Bank last year as it made attempts to remain financially afloat.

Now that Da Pang and Youngman have agreed to buy the Swedish Automaker lock, stock and barrel (for a price of 100 million euros/$142 million U.S.), Saab can now get on with what it does best, namely making quirky cars.

Although the Chinese government has yet to give it’s approval stamp, it appears things are moving forward. Production at Saab’s plant in Trollhattan, is rumored to restart in the next several weeks and a number of new models are apparently in the pipeline, including an updated 9-3, which will reportedly come in fastback (which the sketch above illustrates) and convertible variants. Other planned models include an entry level 9-1 and possibly an executive express (9-6 or 9-8 anyone?).

Although some might say that the Saab-China deal wasn’t agreed under the best of terms (Saab’s owner Swedish Automobile was under intense pressure to get a major lifeline, or else bankruptcy protection would end), there are others that are glad one of the world’s most interesting and alternative car manufacturers is still around.

It’ll be interesting to see if under Chinese stewardship; the blasted brand can finally make some money. Time will no doubt tell.

 |  Oct 27 2011, 10:00 AM

While many other automakers, including Japanese and American manufacturers, have taken a bit of a battering in recent years due to economic uncertainty and natural disasters, Hyundai and Kia have been bucking the trend, reporting steady gains in market share, particularly in entry level segments, where their vehicles have proved appealing to cost conscious buyers.

However, despite steady gains, primarily at the expense of U.S. and Japanese rivals, the South Korean duo is expected to see demand tapering off due to limited manufacturing supply. That said, both brands plan on achieving combined global sales of 7 million units next year, up from more than 6.5 million in 2011, which also marked a record total.

“We expect to reach (the target) should we run our factories at full capacity,” stated Hyundai president Chung Jin-haeng in a news interview with Reuters, though he did add mention that actual sales target number has not yet been finalized.

However some industry analysts, such as Suh Sung-moon at Korea Investment and Securities, believe that Hyundai and Kia’s own estimates of 2012 sales are conservative and both companies could easily surpass these totals in the first half of the year.

“I expect Hyundai and Kia will be able to achieve sales of 7.2 million vehicles next year, with Hyundai’s China plant starting production and Kia introducing a third shift at its Slovakia plant,”  Sung-moon stated.

If achieved, and Toyota continues its spiral downward, Hyundai could potentially move into third place among global automakers, ousting the Japanese giant.

[Source: Automotive News]

 |  Oct 26 2011, 8:15 AM

If sales continue to grow steadily in emerging markets, then it looks very likely that by the end of this year, Volkswagen AG will overtake Toyota as the world’s biggest volume producer of automobiles.

VW’s sales, which ranked third in 2010 are expected to rise by some 13 percent this year, resulting in a total of 8.1 million vehicles finding owners across the globe, according to projections from three different auto analysts, surveyed by Bloomberg.

The surge is expected to come primarily from China, where gains are expected to be around 20 percent for VW and also India, where the automaker’s volume is forecast to more than double.

According to Jenny Gu, a senior market analyst for J.D. Power & Associates, based in Shanghai, “Emerging markets are at a stage of car-adoption by consumers and there is still a large space for sales to grow. VW realized this and put a lot of effort on emerging markets.”

Toyota, by contrast, is still struggling in the wake of the March 11 natural disaster in Japan. In addition, the company  also had to suspend operations in Thailand recently due to heavy floods, though analysts at IHS Automotive believe that Toyota has every chance of recovering and nudging VW out of the lead as the largest vehicle producer next year, provided its recovery remains on track. Current estimates from IHS peg Toyota selling some 8.4 million vehicles next year, about 500,000 more than Volkswagen.

Whether that happens or not, one thing’s certain; emerging markets are seen as key to growth in the automotive sector, as sales in developed countries slow. Volkswagen plans to invest a record 62.4 billion Euros (approximately $87 billion US) next year, plus another 14 billion Euros on its  joint venture operations in China.

VW was the first western automaker to set up shop in China and has been selling cars there for around three decades. And it looks like its goal of becoming and remaining the world’s biggest automaker in terms of volume is likely to bear fruit, for in addition to VW products, it’s also seen demand for its Audi brand vehicles grow significantly.

In terms of global sales, Audi nudged past Mercedes-Benz this year to become the second volume seller of premium branded cars and SUVs in the world, behind BMW. In addition, Audi  plans to build another factory in China in order to cope with growing demand – sales in that country are projected to reach some 700,000 units annually by 2015, according to Dietmar Voggenreiter, head of Audi’s Chinese operations.

However potential obstacles to achieving number one status still loom on the horizon. The ongoing dispute between VW and Suzuki over their intended alliance is likely to cause possible road blocks, especially in India where Maruti-Suzuki is by far the most dominant player in the automotive market, as is the situation at home between VW and Porsche AG, where a planned merger is experiencing significant delays.

[Source: Automotive News]

 |  Oct 20 2011, 8:15 AM

Imported vehicles in the United States are selling at their highest price premium in more than a decade, as a result of a weak US dollar compared with other currencies like the Euro and Yen.

The result has been a negative impact on the sales of lower priced imported vehicles, resulting in American buyers switching to domestic brands such as Chevrolet and Ford.

In fact, the average selling price for a new imported car reached a dizzying $31,536 in August, some $7,614 than the average domestic made vehicle during the same period, according to the US Bureau of Economic Analysis.

Automakers such as Honda and Toyota are reluctant to import smaller, cheaper offerings, which traditionally have lower profit margins, than larger, more expensive vehicles. The aftermath of the March 11 earthquake and Tsunami in Japan didn’t help matters, resulting in supply issues that further hampered both production and imports.

Other overseas brands, namely premium priced European offerings, gained a greater proportion of imported new car sales, particularly Volkswagen and Audi, according to findings from Paul Ballew, chief economist for Nationwide Mutual Insurance Co. in Columbus, Ohio.

“It’s very hard to import, especially from Asia, small cars right now because of where the dollar is,” Ballew said. “If you look at luxury-car sales the last few months, they’re up double-digits from a year ago while small cars are down more than 20 percent.”

As the Yen continues its march against the dollar, Japanese manufacturers are less likely to offer incentives to move metal off dealer lots; in fact average industry wide spending on incentives fell some 9.6 percent through September, down to $2,498 per vehicle.

In an effort to counter further profit margin erosion, Japanese automakers are also looking to shift more production of vehicles overseas; Nissan is already boosting investments in plants it operates in Thailand and Mexico, in addition to constructing a new facility in Brazil, scheduled to become operational in 2014.

Toyota meanwhile, is planning to spend some 26.3 billion yen, building a second plant in Indonesia as it aims to build a robust supplier network in that country, part of its goal to not only minimize future supply problems but boost vehicle demand in emerging markets.

Even German automakers such as BMW and Volkswagen are investing heavily overseas, the former expanding operations in South Carolina, while the former has opened a new plant in Tennessee, marking the first time that VW vehicles have been assembled in the US since 1988.

According to Ballew, “import manufacturers cannot afford to do what they’ve normally done in terms of bringing in products from Asian markets. You’re looking at some temporary anomalies, but you’re also looking at some structural changes. There is some renewed energy to bring manufacturing into the US.”

[Source: Automotive News]

 |  Oct 14 2011, 8:00 PM

 

Amid the ongoing dispute between Suzuki Motor Co and Volkswagen AG, Suzuki has written to VW, alleging various breaches of contract and asking VW to address the situation.

However, despite claiming numerous cases of contract infringement, during a press statement, Suzuki failed to highlight exactly what those specific breaches were.

The origins of the quarrel between the two automakers date back to 2009, when VW acquired a 19.9 percent stake in Suzuki, while the Suzuki purchased a 1.49 percent share in the German giant.

Sukuki’s fiery chairman, Osaku Suzuki, has maintained all along, that from his company’s standpoint, the alliance was meant to facilitate Suzuki’s access to VW technologies, though in a recent press statement he said, “I remain disappointed that we have not received what we were promised. If VW will not allow access, it must return Suzuki’s shares.”

VW on the other hand, claims Suzuki also violated terms of the contract by failing to disclose that it had done a deal with FIAT to supply engines, yet Suzuki maintains that this allegation “significantly disparaged Suzuki’s honor” and continues to seek an apology and retraction from the Wolfsburg company.

With both parties at loggerheads, it seems that they will each have to resort to legality processes, in order to have any chance of resolving the situation, though given how hostile said situation has become, it is very unlikely either company will be interested in salvaging what’s left of the alliance.

According to an IHS Automotive industry analyst in Tokyo, Masatoshi Nishimoto, ”if the partnership with VW is delaying [Suzuki's] development of new technology and cars, they need to end it as soon as and as calmly as possible.”

[Source: Bloomberg]

 |  Oct 10 2011, 9:00 AM

Despite these uncertain economic times, some luxury car makers have made healthy sales gains in recent months, particularly Land Rover. Along with sister company Jaguar, which had been languishing behind somewhat, the JLR group collectively boasted a 26 percent gain in global sales last month.

Much of the increase came from Jaguar, which saw demand rise by a whopping 157 percent in China, Land Rover, by comparison, reported gains of 85 percent in the same market.

In Europe, demand for both brands was up by some 37 percent, largely fueled by strong demand for new Range Rover Evoque and Jaguar XF diesel.

In North America, where Jaguar Land Rover has been struggling recently, September represented a refreshing turn of events, with demand up by some 10 percent, largely aided by the XF, which is proving quite popular with buyers here.

Phil Popham, Group Sales Director for Jaguar Land Rover went on the record stating that [2011] “has been our strongest September since 2007 when the industry was hit hard by the recession. Since that time we have introduced a host of new models and engines that has driven sales growth and attracted new consumers to our brands.”

It’s nice to know there’s at least some bright spots in an era seemingly dominated by much doom and gloom.

 |  Oct 04 2011, 8:15 PM

It’s no secret that the upcoming Corporate Average Fuel Economy targets, whereby all automakers who sell vehicles in the US, must achieve 35.5 miles per gallon as a fleet average between now and 2016 and  54.5 mpg for cars and light trucks by 2025, represent a formidable hurdle.

In order to better achieve these targets and reduce the risk of fines, some manufacturers are finding the best way is to join forces and develop technology together.

One of the latest such endeavors could likely see General Motors and BMW teaming up. The idea is for the General to leverage its expertise in fuel cell and electric vehicle technology, while BMW would provide its own in conventional gas and diesel powertrains.

By joining together, both companies will be able to develop competitive advantages in the marketplace, thanks to reduced R&D and operating costs.

According to Forbes, such a partnership could prove advantageous for GM, enabling it to deliver good quality, fuel efficient vehicles in a variety of international markets, while keeping a cap on overall costs. Forbes believes that offering such vehicles will allow for significant market share gains over the medium and longer term, boosting the price of GM’s stock in the process.

[Source: Forbes]

 |  Sep 23 2011, 4:50 PM

In perhaps a case of robbing Peter to pay Paul, head of the Canadian Auto Worker’s Union, Ken Lewenza  has expressed some concern over a tentative new agreement south of the border between the UAW and General Motors.

The problem centers around the fact that in order to meet the new UAW bargaining agreement, part of GM’s production of its small SUVs, the Chevy Equinox and GMC Equinox might be moved from the CAMI plant in Ingersoll, Ontario, down to Spring Hill, Tennessee.

At present, GM hasn’t made any official announcements regarding the move, though an article in Nashville based newspaper, the Tennessean claims the General is seriously considering such a strategy, citing economic officials.

The resulting story was enough to cause concern for the CAW, making the matter more worrisome is the fact that GM has already pulled such a move, shifting production of it’s full-size Chevy Impala sedan, from Oshawa, Ontario, to the Hamtramck plant on the outskirts of Detroit, something Lewenza says he also first heard about through the newspapers.

As regarding the Tennessee rumors, during an interview with trade publication Automotive News, Lewenza said “where there’s smoke, there’s usually fire.”

[Source: Left Lane News]