Global News: Ford Supports GM in Europe; British Motor Show Cancelled; Brazilian Auto Sales Surge; Seat Workers Vote for Pay Freeze
By Michelle Krebs March 20, 2009In news from around the world Thursday, Ford of Europe offered support for General Motors Europe's request for government aid, the 2010 British International Motor Show was canceled, Brazil car sales this month are rising and union workers for Volkswagen's Seat subsidiary approved a two-year pay freeze to prevent layoffs.
In Europe, Ford's top executive John Fleming told Automotive News Europe that he supports GM's request for state aid. "We have no objections to competitors asking governments for support," said Fleming. "I would rather take sales from competitors by having better products rather than them going out of business." Fleming also added that losing business from GM's Opel subsidiary would strain suppliers and "put a huge stress on the industry."
In the United Kingdom, the British Motor Show for 2010 has been canceled due to "the economic downturn and the unprecedented challenges facing the industry," according to a statement by the show's organizer, the U.K. Society of Motor Manufacturers and Traders. The trade group said the economic climate has "made it impossible for exhibitors to commit to a 2010 event." The bi-yearly event, first held in 1903, has only been canceled previously during the two world wars.
The British Motor Show isn't suffering alone. Fiat and Daihatsu have both withdrawn from the Shanghai auto show next month. Both cited global marketing budget cutbacks as the reason. Fiat, which also announced Thursday postponement of a joint venture with Chinese automaker Chery Automobile Co., will only exhibit at the Tokyo, Frankfurt, and Geneva auto shows this year. Daihatsu has indefinitely stopped participating in all shows outside of Japan, where Tokyo auto show organizers are to decide soon if they will move forward with this fall's show.
In Brazil, the dealer association Fenebrave announced auto sales increased 4.4 percent for the first half of March versus the same time period in February, setting pace for a fourth straight month of sales growth. The four-month sales rally was spurred by the temporary lift of a government tax on industrial production, which resumes in April. Brazil's overall economy is forecast to retract by 2 percent in 2009, according to IHS Global Insight, and automakers are pleading with the government to extend the tax break while the industry struggles through recession.
Spanish union workers at Volkswagen's Seat Martorell factory approved a two-year pay freeze as part of a deal to save 1,500 jobs and gain a contract to build the Audi Q3 sport-utility vehicle. Seat, which depends too heavily on domestic sales, has been hit hard as vehicle sales in Spain spiraled down 28 percent in 2008, delivering Seat a 2008 operating loss, compared with a slim profit in 2008.
AutoObserver's Global News is compiled by Edmunds.com's Senior Manager David Greene.
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