Saleen-ASC Combine Motor City Grit, California Glamour
By Joseph Szczesny
TROY, Michigan -- Behind the introduction of the Saleen S5S Raptor at the New York International Auto Show in March is the story of a corporate reorganization that blends two companies previously struggling on their own.
The new Saleen Inc. combines Motor City grit of the former ASC and the California glamour of the former Saleen operations in finely calibrated balance, said Paul Wilbur, CEO of the new Saleen.
Wilbur told AutoObserver that the Raptor is the first project in which both sides of the house have contributed. It combined the efforts of Saleen engineering and ASC's creative team, which usually labors in anonymity for big clients such as General Motors.
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Hewlett-Packard Buying EDS, Once GM Owned
Wall Street is abuzz with the news that Hewlett-Packard is buying Electronic Data Systems for $12.6 billion.
Old-timers in the auto industry may remember that General Motors, with the late and controversial Roger Smith at the helm, purchased EDS, founded by H. Ross Perot, in 1984 for $2.6 billion. GM's purchase of EDS along with Hughes Aircraft and a host of small high-tech companies was part of Smith's vision to
It didn't work out that way. Perot, who served on the GM board, complained all too publicly of how hidebound and slow to act GM was, prompting GM to buy out Perot, who went on to form another company and run for U.S. president, and spin off EDS. GM remains one of EDS's largest customers; EDS employees occupy two towers of downtown Detroit's Renaissance Center, purchased last week by GM and used as its corporate headquarters.
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Hybrids "Paying Off" More Quickly, New Edmunds Data Shows
By Bill Visnic
As gasoline prices go higher, many hybrid-electric vehicles currently on sale are proving to be even wiser investments, say new data from Edmunds.com.
Considerable past discussion about hybrids has focused on "payback" time, or the period required for savings from a hybrid's enhanced fuel economy to recoup the initial higher purchase price a hybrid commands. Detractors often claimed that, from a strictly fiscal view of hybrids, most vehicle purchasers would never save enough in gasoline costs to recover their investment in expensive hybrid technology.
But with every increase in gas prices, the hybrid payback time becomes consequently shorter - to the point where some popularly-priced hybrid models can pay back their owners' investment in as little as 18 months, according to the new Edmunds.com study.
(Read more...)
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Remember the Last "Quick Fix for Gas Addicts"?
Ah, how quickly some of us forget.
It was almost two years ago to the day that General Motors announced a fuel price protection program, much like the one Chrysler launches on Wednesday. GM offered buyers of certain vehicle models, mostly large SUVs, in Florida and California a guarantee of gasoline capped at $1.99 a gallon for a year.
The promotion didn’t move the needle on sales, and it opened the floodgate of criticism of GM, especially in a now-famous column by The New York Times’ Thomas Friedman.
We're betting GM won’t be following Chrysler’s lead -- and we're wondering if Friedman is dusting off his old column to blast Chrysler.
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UAW Strikes GM Where It Hurts Most -- in the ‘Bu
By Michelle Krebs
The United Auto Workers union struck -- literally -- General Motors where it hurts most -- at the automaker’s Kansas City, Kansas, factory that builds the fast-selling Chevrolet Malibu, already in tight supply.
The 2,600 UAW workers in Kansas walked off the job Monday morning after a strike deadline passed with no local contract. The supposed hangup is over seniority issues and work rules. However, many experts believe the strike -– and ones threatened at other GM plants –- has less to do with local GM issues than it does to show support of its union brothers at American Axle, on strike against the GM supplier for more than 70 days.
Whatever the case, a strike cutting Malibu production is damaging to GM, especially if it lingers.
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April Car Sales: U.S. Consumers Flock to Cars, Gouging Detroit Three
By Dale Buss
Americans rushed to swap their thirsty trucks and SUVs for fuel-efficient cars in April, making the month a turning point for the industry’s biggest segment shift in memory.
The stampede to cars left in the dust a Detroit Three that simply weren’t ready for its magnitude because of their reliance on truck-based vehicles, while it lifted Japanese automakers whose traditional strength has remained in small cars.
As U.S. consumers definitively reacted to $3.50-a-gallon gasoline, passenger cars outsold truck-based vehicles for the first time in at least 20 years. The move comprised a shift of six percentage points for the industry compared with last April, to 54 percent car sales.
(Read more...)
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Biofuels Stakes Rise for GM and the Nation
By Dale Buss
With its second major equity investment in a biofuels startup company in the space of five just months, General Motors is moving front and center in what may become a pivotal global economic development of our time: the rapid rise of the cellulosic-ethanol industry.
GM’s announcement on Thursday that it has made an equity investment in a Boston-based company, Mascoma Corp., is a bookend to its January deal to help fund Coskata Inc., based in Warrendale, Ill. The two companies, partially nurtured by academics, use two different processes to yield similar crucial results: the production of ethanol for fuel from non-grain, essentially waste sources.
(Read more...)
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Gasoline Programs Could Be Next Wave of Incentives, Edmunds.com Predicts
SANTA MONICA, Calif. — As gas prices rise this summer, automakers may well turn to marketing programs that include free gasoline instead of or in addition to cash rebates and low-interest financing, Edmunds.com predicts.
“Gas prices are having a profound effect on the psychology of car-buyers, so we expect that automaker and dealer marketing tactics may include free gasoline programs this summer,” stated Jesse Toprak, executive director of Industry Analysis for Edmunds.com. "As indicated in Edmunds’ True Market Value Predictive Alerts, transaction prices of gas-guzzling large SUVs and trucks will likely continue to fall.”
Meantime, Edmunds.com estimated Thursday that the average automotive manufacturer incentive in the U.S. was $2,449 per vehicle sold in April 2008, up $13, or 0.5 percent, from March 2008, and up $39, or 1.6 percent, from April 2007.
(Read more...)
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Chevrolet Malibu, Ford Fusion, Pontiac G6 Gain Traction in Crucial ‘C’ Segment
By Dale Buss
Chevrolet Malibu is helping put Detroit back on the map in the mid-size sedan segment. Even the three-year-old Pontiac G6 and Ford Fusion are helping out on that front as well.
Of course, the real Big Three of the so-called “C” segment of the market remain solidly entrenched atop it: Honda Accord, Toyota Camry and Nissan Altima. Accord was the nation’s hottest-selling vehicle during the first quarter, according to Edmunds.com data, overcoming a sluggish start since the new model’s debut last fall to move 88,000 units from January through March. Camry, at 84,000 units, and Altima, with 76,000 sales, were right behind.
But domestic automakers nevertheless are encouraged by recent glimmers of hope in a crucial segment in which they haven’t been competitive for several years -- even though mid-size sedans used to be the Big Three’s bread and butter. At least the progress lately is a place to start.
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GM Partners With a Second Cellulosic Ethanol Maker
General Motors plans to announce Thursday a second partnership with a cellulosic ethanol maker. The automaker is providing no further details until GM President Fritz Henderson makes the announcement in Washington, D.C.
GM already has announced a partnership with an Illinois-based cellulosic ethanol maker, Coskata Inc., and last week said Coskata was establishing a pilot plant in Pennsylvania to demonstrate its innovative process of converting a variety of materials, from garbage to agricultural waste, into ethanol.
GM's partnerships for developing cellulosic ethanol come against a backdrop of increasing outcry for the industry to quit using corn-based ethanol, as food prices rise.
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GM Downgrades 2008 Industry Vehicle Sales Forecast
Previously more optimistic than other automakers, General Motors Wednesday announced it had downgraded its U.S. vehicle sales forecast for 2008. GM now expects industry sales to come at in the mid to high 15 million units range, instead of the low 16 million. GM had predicted some upturn in the second half.
GM President Fritz Henderson, in a conference call with analysts and media on first-quarter earnings Wednesday, said April sales, which will be reported Thursday, look like the weak sales throughout the first quarter.
(Read more...)
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GM Loses $3.25 Billion in the First Quarter
General Motors Wednesday reported it lost $3.25 billion in the first quarter due slow U.S. vehicle sales, losses at its finance unit and plant shutdowns caused by a strike against one of its suppliers.
Analysts expected GM to post a loss, which was the automaker's third consecutive quarterly loss and compares with a profit of $62 million in the year-ago quarter. However, the loss was less than analysts had forecasted thanks to GM's rising sales in Asia and Latin America that helped offset the slump in the U.S.
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GM Slashes Truck, SUV Production Due to Slow Sales
Continued slow sales prompted General Motors to announce Monday that it will cut
production of large pickup trucks and sport-utility vehicles this year.
In total, GM said it is slashing production by about 10 percent, or about 138,000 vehicles at four plants in the U.S. and Canada. About 3,550 workers will be out of jobs as a result.
The question being asked is will sales of those high-profit vehicles, in light of skyrocketing gasoline prices, ever bounce back?
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Ford’s Early Agreement with Canadian Union a Positive Sign
By Michelle Krebs
The news that Ford reached an early agreement with its Canadian union is being overshadowed by Las Vegas billionaire Kirk Kerkorian's purchase of the automaker’s stock, but the Canadian deal is every bit as significant -- maybe even more so.
Talks between Detroit’s three automakers and the Canadian Auto Workers union regarding a new contract to replace the current ones that expire in September appeared as if they could be extremely rancorous. A strike appeared to be a distinct possibility.
But Ford’s announcement Monday that it had reached an agreement with the Canadian union -- especially in an unheard of four months plus ahead of schedule decreases -- lessens the odds.
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April Auto Sales: Buyers Continue Shift to Smaller Cars and SUVs
SANTA MONICA, Calif. – As gas prices skyrocket, the biggest growth in April vehicle sales
are expected to be in small cars and small SUVS. In total, April vehicle sales likely will show a decline from April of last year but increase from this past March, according to a forecast by Edmunds.com.
Automakers are expected to report new vehicles sales, including fleet sales, of 1.3 million units for April, a 2.2 percent decrease from April 2007 and a 3.7 percent increase from March 2008, Edmunds.com predicts. April 2008 had 26 selling days, two more than last April 2007. When adjusted for this difference, sales decreased 9.7 percent from April 2007.
“It’s clear that gas prices are weighing heavily on car-buyers’ minds," observed Jesse Toprak, Edmunds.com’s executive director of Industry Analysis. “We predict that this month, the segments with the most year-over-year growth will be compact SUVs and compact cars at 52 percent and eight percent, respectively.”
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Kerkorian's Tracinda Builds Stake in Ford
He’s back and Ford is the object of his affection this time.
Last Vegas billionaire Kirk Kerkorian, through his Tracinda Corp., has amassed 100 million shares for a 4.7 percent stake in Ford just this month. Further, Tracinda said it plans to buy up to 20 million more shares at a premium to last week’s closing price.
Kerkorian’s move on Ford is a vote of confidence for Ford management led by CEO Alan Mulally and the company’s turnaround prospects.
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GM Ethanol Partner Announces Pilot Plant
By Bill Visnic
PITTSBURGH – Coskata Inc., developer of a unique process that uses specialized bacteria to produce cellulosic ethanol – and with whom General Motors Corp. formed a partnership last January – announced Friday it will begin construction near here for the first production facility to demonstrate the process.
The demonstration plant, Coskata says, will start early next year and run 24 hours a day to produce about 40,000 gallons of cellulosic ethanol derived from almost any organic waste material, including agricultural waste and municipal garbage that might normally be placed in landfill.
(Read more...)
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GM 1Q Global Sales Flat Thanks to North American Drop
By Bill Visnic
General Motors Corp. says its first-quarter 2008 global sales reached 2.25 million vehicles, a drop of less than one percent despite the drag of lagging North American sales.
GM sales of 947,000 units in North America was a roughly 10 percent drop compared with 2007’s first quarter. GM executive director of global market and industry analysis Mike DiGiovanni said the number “exceeded our internal forecasts,” but also says, counter to some industry analysts, GM does not expect U.S. sales to shore up in the second quarter. DiGiovanni said the company does not anticipate a firming U.S. market until at least the second half of the year.
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Strategies Changing Quickly in the Green Game
By Dale Buss
As Earth Day comes around once more, there are a few different scoreboards for tracking the relative progress of automakers in their attempt to win the green derby.
According to Toronto, Canada-based consumer-research firm BrandIntel’s recent survey of online discussion, for example, Toyota, Honda, Mercedes and Volkswagen have the most “green credibility” due to their hybrid and diesel vehicles. General Motors and Chrysler have been stuck among the least-credible because of their large fleets of trucks and SUVs and weaker lineups of hybrids and diesel options. Ford sits in the middle.
But several automakers are forging strategies for changing such scoreboards in their green credentials. A look at a few:
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For Automakers, Green Mantle Could Become a Golden Cloak
By Dale Buss
Toyota clearly donned it for awhile. Ford tried it on for size. American consumers seem to think it fits Honda pretty well these days. But no one covets it more now than General Motors.
We’ll call it the “green mantle:” a figurative decoration on the shoulders of automaker that tells the world, and competitors, that their company is the most environmentally renowned in the industry, both for their products and technologies and – perhaps even more important – in the public’s overall regard.
And taken particularly in the context of an annual worldwide recognition such as today’s Earth Day, it seems at least as important for any corporation to earn the perception of environmental responsibility as to actually be doing something tangible.
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Big ’07 Loss Drops GM in Fortune 500
It was bound to happen. General Motors Corp., once the granddaddy of the American corporate world, is gradually becoming a less-influential player on the nation’s business chessboard.
The Associated Press reports GM has dropped one place, to No. 4, on the Fortune 500 list of U.S. companies with the largest revenues. Last year, GM was No. 3 behind Wal-Mart Stores Inc. and Exxon-Mobil Corp. But thanks to a loss of $38.7 billion last year – dropping its revenues to $182.3 billion, GM slips behind oil giant ChevronTexaco Corp., which recorded $210.8 billion in revenue in 2007.
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Beijing Auto Show and China’s Auto Industry: Life in Fast-Forward
By Michelle Krebs
BEIJING – No more models dressed in cheesy mermaid costumes. Not a pink fur-covered Hello Kitty car in sight. Beijing’s auto show, like China’s auto industry and the country itself, has grown up and gained sophistication rivaling other global entities –almost.
And it has happened fast, as life does in China – life lived in fast-forward, as one expatriate auto company executive described it. 
The Beijing auto show is an analogy to the China auto industry – and Chinese economy generally: spectacular progress and phenomenal growth in the blink of an eye, but still a tad off in the final bit of refinement necessary to be considered world-class – a level assured to be achieved at some point.
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GM to Introduce Buick LaCrosse Hybrid in China
By Michelle Krebs
BEIJING -- General Motors will begin selling the industry's first mainstream hybrid car by the time the 2008 Olympics opening ceremonies are held here. The hybrid system will go into the popular Buick LaCrosse sold in China.
Chinese production of the hybrid LaCrosse begins in June with sales following in July. Specifications on the car, which likely uses the same hybrid system as the U.S.-sold Chevrolet Malibu and Saturn Aura hybrids, will be disclosed at GM's auto show press conference Sunday. They did say the LaCrosse hybrid achieves fuel efficiency 15 percent better than the non-hybrid LaCrosse sold here with 15 percent lower emissins. Price has not been revealed though it will be higher than the non-hybrid model.
The hybrid LaCrosse is part of a grander GM scheme to go green in China, which if confronted with energy and environmental issues of monumental proportions.
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UAW Strikes GM, Dana Gets Ex-Toyota Exec
By Bill Visnic
The massive gears of the auto industry’s manufacturing sector continued to grind out a changing tune this week, reacting to larger, macroeconomic forces in the U.S. economy that are mandating interesting, if not wrenching, change, particularly for the domestic Big Three automakers.
On Thursday, union leaders for United Auto Workers Local 602, representing workers at General Motors Corp.’s Delta Township assembly plant near Lansing, MI, called a strike because the local has yet to sign a plant-level contract with GM, despite what it claims have been months of negotiation. The plant assembles GM’s new generation of crossover utility vehicles, the GMC Acadia, Saturn Outlook and Buick Enclave. The Enclave and Acadia have been selling briskly.
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General Motors Hires Ex-Nissan McNabb
General Motors has hired former Nissan executive Mark McNabb and reorganized its sales, service and marketing divisions.
GM will have four brand channels -- Chevrolet, Saturn, Buick-Pontiac-GMC, and Cadillac-Hummer-Saab. McNabb will head the "premium" channel of Cadillac-Hummer-Saab.
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Chevrolet Malibu Production Safe Despite Supplier Strike
General Motors said the UAW strike against supplier American Axle & Manufacturing Inc.
will not stop production of the hot-selling Chevrolet Malibu, as had been feared.
Bo Andersson, GM's group vice president of global purchasing and supply chain, told reporters in Detroit that the company has “a good plan,” details of which he would not disclose, to keep up production of the Malibu. "We have been able to produce vehicles in all of our car plants, besides one. I don't see anything changing from where I sit," he told reporters.
Negotiations are continuing between American Axle and the union.
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GM Brazil Builds Second Plant
General Motors announced Monday it will build a $200 million engine and parts plant in Brazil, where sales are booming and GM is the market leader.
The plant will employ 500 workers and will start production in the fourth quarter of 2009. When it reaches full capacity, it will produce 120,000 engines and 50,000 cylinder heads a year.
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American Axle Strike Head into Seventh Week; More GM Plants Threatened
The strike by United Auto Workers union employees against Detroit parts supplier
American Axle & Manufacturing Inc. is headed its seventh week with no end in sight, and it is threatening to close General Motors' assembly plants that produce some of the automakers most popular vehicles, including the 2008 Chevrolet Malibu.
In the latest development, the UAW rejected the company’s request to bring in a federal mediator to settle the strike.
(Read more...)
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Big Three Boost U.S.-Made Exports
Last year's landmark labor contracts and the weak U.S. dollar are breathing new life into U.S. auto plants as Detroit automakers boost exports of U.S.-made vehicles, the Wall Street Journal reports.
General Motors plans to export U.S.-made vehicles to Europe, China and Latin American markets such as Brazil; Chrysler is shifting production from Europe to the U.S. to take advantage of lower costs and available plant capacity; and Ford is considering ramping up exports if it can bring labor costs down, the business journal reported in Tuesday’s edition.
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Pontiac Channels March Madness into Enthusiasm for G8
By Dale Buss
When the last of the No. 1 seeds take the floor for the NCAA Men’s Basketball Championship game in San Antonio on Monday night, the contest will represent the zenith of one of the most successfully symbiotic sponsorships in television sports.
Pontiac has been the exclusive domestic-brand automotive sponsor of the final weekend of March Madness for four years now. It is one of only three “corporate championship partners” with the tournament, along with AT&T and Coca-Cola. Last year, the televised tournament attracted more than 132 million people to CBS, roughly 46% of all American viewers. That includes not only youthful potential car buyers but millions of college alumni.
So, according to both brand executives and Edmunds.com analysis, the relationship is boosting consumer consideration of Pontiac and its vehicles – especially the new G8 – making rival other strong TV-marketing properties for automakers.
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Capacitors Get a Boost from Suzuki
By Bill Visnic
Battery talk has become favorite dinnertime discussion throughout the industry.
It’s been that way at least since General Motors Corp. started pumping up the volume about its Chevy Volt — a so-called “extended-range electric vehicle” concept car everyone wants to see come to production. But it won’t unless battery developers now working feverishly to perfect lithium-ion chemistry can whip up the right formula to allow the car to run for 35 or 40 miles purely on battery power.
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GM Says 40 Miles Doable, but the ‘Business’ of Chevy Volt Battery Just Beginning
By Bill Visnic
DETROIT — General Motors Corp. executives and engineers said Thursday they’re confident they can hit the ambitious target of 40 miles of battery-driven range for the company’s high-profile Chevrolet Volt “extended-range” electric vehicle.
What the company’s not saying is which of its competing lithium-ion battery developers — Compact Power Inc. (using cell technology developed by Korea’s LG Chemical) or Continental Automotive Systems (cells from Boston’s A123 Systems) — might prevail.
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UAW-American Axle Strike: Signs of Progress?
By Joseph Szczesny
DETROIT — After a three-week impasse in which negotiations went nowhere, there are finally some signs of movement in the talks aimed at ending the United Auto Workers month-long strike against American Axle and Manufacturing Inc.
American Axle CEO Richard Dauch disclosed the company had turned over sensitive financial data the union had requested. The UAW said it was evaluating the new information from the company, which has been pressing for pay and benefits concessions.
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March Sales: No Denying the Slump Is Real
By Dale Buss and Michelle Krebs
Automakers in March finally experienced the full brunt of two huge economic problems that had been nibbling at their market for months: rising gasoline prices, and American consumers’ falling economic expectations.
Sales for the industry dropped 11.9 percent in March, to 1,351,838 units, the worst performance for the month since 1993. Even more significant, the results accelerated a market deterioration that saw overall U.S. auto sales fall by 7.8 percent to 3,565,828 units for the first quarter. Annual sales rates, seasonally adjusted, slipped to near 15 million units.
A wicked combination of $3.50-a-gallon gasoline, higher prices for food and other necessities, mortgage woes and a shaky stock market left many American consumers more nervous and dispirited than anyone had expected them to be just a few months ago.
“We’re seeing new-car sales decline, not because people can’t afford them, but because there’s a lack of trust in the stability of the economy,” said Jesse Toprak, chief industry analyst for Edmunds.com. “There’s been a real erosion of wealth, and consumers are not in the mood to shop for a car. This is more of a psychological impact more than the inability to purchase a new vehicle.”
(Read more...)
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Hyundai Genesis Succeeds in Home Market
The 2009 Hyundai Genesis premium sedan, going on sale this summer in the U.S., already looks to
be a winner in its home market of South Korea.
Hyundai reported Tuesday its March sales in Korea rose 12 percent, thanks to the Genesis it launched in January to challenge Mercedes-Benz and BMW in the luxury-car market there.
The Genesis will be Hyundai's flagship, its first rear-wheel-drive car sold in the U.S. and its first car to offer a V8 engine.
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Incentives To Rise Through the Spring and Summer, Reports Edmunds.com
SANTA MONICA, Calif. — The average automaker incentive was largely unchanged in March compared with February, but incentives generally are likely to rise for the next several months as automakers try to break the sales slump, Edmunds.com predicts.
"Incentives are likely to rise through the spring and summer," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com. “We anticipate that this will be especially true for the European automakers, as long as the euro remains strong.”
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GM, Partners Open China Mini-Vehicle plant
SAIC-GM-Wuling, General Motors’ mini-vehicle joint venture in China, began mini-vehicle
production Monday at its second assembly plant in the coastal city of Qingdao.
Its initial product is a new mini-commercial vehicle powered by a 1.2-liter double overhead cam gasoline engine. The facility has an annual production capacity of 300,000 vehicles and can manufacture multiple vehicles on the same line.
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"Green" Convenience Stores, Chevy Dealer Aim To Boost E85 Availability
By Bill Visnic
A Delaware startup company is fronting an ambitious plan to construct 1,000 “Go Green Station” convenience store/fueling stations on the East Coast that will sell only ethanol-based E85 and other alternative fuels.
Alternative Fuel Distributors, created last year to “develop, construct, own and operate convenience stores dedicated to supplying alternative fuels to retail customers,” said it expects to have 100 of the company-owned and trademarked Go Green Station convenience stores open by first-quarter 2009 in Pennsylvania, New Jersey, Maryland and Delaware.
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UAW Membership Falls to New Low; American Axle Strike Goes On
The United Auto Workers union reported its membership dropped below a half-million people for the first time since World War II.
In U.S. Labor Department filings, the UAW said it closed 2007 with 464,910 members, a decline of 14.7 percent or 73,500 members from the previous year and more than two-thirds below its peak of 1.5 million members in 1979. It marks the union's low-water mark of membership since 1941.
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GM Closes More Plants Due to Supplier Strike
By Joseph Szczesny
DETROIT — General Motors' Detroit-Hamtramck car assembly plant, which builds the 2008 Buick Lucerne and 2008 Cadillac DTS, will shut down March 31. The closure is due to parts shortages caused by the strike by workers against supplier American Axle & Manufacturing Holdings, which is entering its second month.
GM confirmed Thursday it will close the plant for an indefinite period.
A GM plant in Janesville, Wis., which builds the 2008 Chevrolet Tahoe and Suburban and GMC Yukon, also will close next week, leaving GM with only two plants producing large SUVs and pickup trucks. An Ohio plant that builds the 2008 Chevrolet Cobalt is at risk for closure soon as well.
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GM's Mary Barra: Tuning Up Automaker's Plants
By Kate McLeod
Mary Barra isn’t the new kid on the block. She is a tested General Motors veteran. She isn’t even that new to her new job as vice president of global manufacturing and engineering. Barra, a native Michigander, has been around GM — in particular around manufacturing and plants — for 27 years.
We’re well beyond writing stories about the first woman plumber or jockey, or indeed the first woman anything. Barra is worth a story because of her job, global responsibility for stamping and die plants around the world — Poland, Brazil, Russia, China and yes, Wisconsin, among others. This is part of GM's new focus — trying to create one company out of many. At GM they think it is the key to survival.
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March Sales: Consumers Not Compelled to Buy, Says Edmunds Forecast
SANTA MONICA, Calif. — Despite an abundance of rich incentive deals, March
vehicle sales for the industry are expected to be lower than March 2007 and even lower than February when automakers report results Tuesday, Edmunds.com has forecast.
March new-vehicle sales, including fleet sales, are expected to total 1.33 million, a 13.2 percent decrease from March 2007 and a 13.9 percent increase from February 2008, according to Edmunds’ forecast on sales figures not adjusted for the difference in selling days.
The forecast is less dreary when adjusted for the difference in selling days. This March had 26 selling days, two fewer than last March 2007. When adjusted for this difference, sales decreased 6.5 percent from March 2007.
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Less Than a Week in Q1; Matching 2007 Sales an Impossible Dream
By Bill Visnic
Analysts and industry-metrics powerhouse J.D. Power and Associates already are predicting a heavy downturn in auto sales for March, based on sales figures from the first half of the month. Now, analysis from Edmunds.com is providing perspective on how bad not just March, but first-quarter sales are likely to be when announced next week.
Based on average sales for the first two months of 2008 compared with last year, the Detroit Three automakers have virtually insurmountable deficits to recover to match first-quarter sales from last year. But longstanding sales juggernaut Toyota Motor Corp. — and several other Japanese automakers — won't be likely to fare much better in what is shaping up to be the brutal retail-sales environment many had predicted.
Indeed, everyone predicted 2008 car sales would be worse than those in 2007; the analysis shows just how much worse in the early going. Some forecasts predict an uptick in the second half; others do not.
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Alfa Romeo: Returning to America
By Michelle Krebs
Alfa Romeo is returning to the U.S. next year, the Financial Times reports in
Tuesday’s edition.
Fiat Chief Executive Sergio Marchionne told the London newspaper Alfa would beginning selling cars in the U.S. next year and be producing them in North America by 2011 or 2012 — with a partner.
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American Axle, Despite Strike, Boosts Chief's Pay to $10.2 Million
This news ought to go over well on the picket line: Supplier American Axle & Manufacturing Holdings Inc., the Detroit automotive supplier embroiled in a strike now entering its fifth week, boosted the total compensation for CEO Richard E. Dauch by 9 percent after he restored the company to profitability last year.
Dauch's pay package, including salary, stock and option awards, and change in pension value, rose to $10.2 million from $9.3 million, the company said in its annual proxy statement filed Monday and cited by Dow Jones. Four other top officers also got raises.
Meantime, the company has told workers — 3,650 of them United Auto Workers union members who have been walking the picket line since Feb. 26 — they must reduce wages and benefits by more than half to compete against lower-cost rivals.
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March Car Sales Down, J. D. Power Report Says
Not surprisingly, major automakers saw retail sales drop in the first half of March compared with the same period a year ago, according to a report by research firm J.D. Power and Associates. The firm predicts total March sales will hit an annual selling rate of 15 million, dramatically lower than the 16.2 million rate of a year ago.
J.D. Power said in a report to its clients cited by Dow Jones that March saw year-over-year double-digit declines in retail car sales at General Motors, Ford and Chrysler. Toyota's sales also were off in the early weeks of the month.
J.D. Power recently reduced its 2008 car sales forecast to below 15 million, which would be the lowest level since 1994.
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GM Establishes Uzbekistan Joint Venture
General Motors and UzAvtoSanoat have established a joint venture to manufacturer and distribute vehicles in Uzbekistan. GM said the joint-venture company will play a defining role both in the automotive industry of Uzbekistan and in the continued, rapid global growth of GM’s largest brand, Chevrolet.
GM said the new joint-venture company, called General Motors Uzbekistan, has the potential in the mid-term to build as many as 250,000 Chevrolet models in the country and distribute a variety of Chevrolet cars and SUVS through a network of more than 60 dealers.
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Saturn Pilot Program to Push Online Shopping
By Dale Buss
General Motors’ Saturn division plans to launch a pilot program within three months that is intended to allow integrated online execution of just about every aspect of a vehicle purchase that can be legally and physically accomplished outside a dealership.
AutoObserver has learned that Saturn’s test — with as many as 10 dealers nationwide — will allow customers to perform several functions on a dealer’s Web site that currently either must be handled in the showroom or executed only piecemeal online, including checking dealer inventories, applying for credit and scheduling a test drive.
The pilot also is expected to test ways to use the Internet to facilitate the evaluation of customers’ trade-in vehicles and to negotiate price using online chat and e-mail between dealership personnel and customers.
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New York Auto Show: The Good, Bad and Ugly
By Jane Nakagawa
NEW YORK — The New York International Auto Show opens to the public Friday, and what a difference a year makes.
Toyota is the nation’s second-largest brand not Ford. Jim Press is the vice chairman and president of Chrysler, not Toyota. Cerberus Capital Management, not Daimler, owns Chrysler. The national average price for a gallon of premium gas is $3.60, not $2.80.
And the most interesting cars at the New York auto show are diminutive and original, not colossal and extravagant.
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Economy Grabs the Spotlight at New York Auto Show
You know the economy is bad when the endlessly thriving Toyota says it may not hit its sales targets.
Remarks by Toyota executives in South Korea on Wednesday about the economy echo those being made by other auto company executives during this week's press days for the New York auto show where the economy, more than the cars, grabbed the spotlight.
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GM Plans Second Mini Car in India; Could Be Exported
NEW DELHI, India — General Motors said Monday it plans to build a second minicar in India, only a year after it launched its first one — the Chevrolet Spark — there, Dow Jones Newswires reported.
Dow Jones quoted GM’s president of Asia Pacific operations, Nick Reilly, saying: “We believe there is space for us to have another entry in the minicar segment in India.”
Reilly said the new minicar, which he did not identify, could be introduced within two years, could be exported from India and will be built at GM’s second plant in India. The new plant is just now gearing up for full production by the fourth quarter of this year. GM has invested $300 million in the plan to build 140,000 vehicles a year.
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New York Auto Show: Big Engines Not Dead in the Big Apple
By Bill Visnic
In relation to the mainly heavyweight environmental message emanating from the Geneva Motor Show, this week’s New York auto show practically delivers a let’s-dirty-a-little-air counterstroke.
After all, the 2008 New York show, bringing the international auto show circus back to U.S. domestic automakers’ soil, is headlined by seemingly desperate V8 volleys from General Motors Corp.’s Pontiac and Chrysler LLC, the latest twist on BMW’s V8-toting M3 and some big-bore but low-volume fireworks from the likes of Lamborghini and Toyota Motor Corp.’s Lexus.
V8s and V10s — yep, we’re back in the States.
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GM, Ford Stock Plummets to Historic Lows
Shares of General Motors and Ford plummeted to historic lows Thursday after Morgan Stanley Research cut its earnings forecasts based on a lowered outlook for U.S. auto sales. The report came on top of waning consumer confidence, higher gas prices, tightening credit availability and issues with auto suppliers.
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Supplier Strike Could Last Through April, Expert Says
By Joseph Szczesny
The United Auto Workers strike at American Axle & Manufacturing Inc. that affected 28 General Motors plants across the country could easily last through April, one industry expert said Thursday.
Sean McAlinden of the Center for Automotive Research in Ann Arbor, Mich., said of the strike against American Axle: "I could see it going 60 days. The union has been telling people its members can stay out 60 days or longer if necessary, and I believe them."
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GM: More Job Cuts in Louisiana
General Motors has laid off 45 workers from its Shreveport, La., assembly plant, less than a month after 68 other workers were idled, The Associated Press reported.
The plant employs about 1,200 hourly workers to manufacture the Chevrolet Colorado, GMC Canyon and Hummer H3. GM said the layoffs of the skilled-trades workers (not assembly-line workers) were due to the economic downturn and slow sales. Trucks and SUVs, like those made by the plant, have been particularly hard hit by slumping vehicle sales.
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GM: Won’t Intervene in American Axle Strike
A top General Motors executive said the automaker is concerned by the two-week strike against parts supplier American Axle & Manufacturing, which has slowed or stopped production at 29 GM plants. But he said GM won’t intervene in the dispute.
Fritz Henderson, promoted last week to GM president and chief operating officer, told The New York Times in an interview Monday that GM would be more concerned if it were losing sales due to lean inventories. The strike has mostly affected plants that make GM’s pickup trucks and large sport-utility vehicles, which are in abundant supply and low demand.
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TROY, Michigan -- Behind the introduction of the Saleen S5S Raptor at the New York International Auto Show in March is the story of a corporate reorganization that blends two companies previously struggling on their own.
