Last August, TTAC predicted the Chinese auto makers would start taking steps to edge their joint venture partners out of their market. And so today's International Herald Tribune reports that the Chinese government has "asked automakers to combine to compete with overseas rivals like Toyota and Volkswagen." To that end, China's largest auto maker has just announced that they're buying Nanjing Automotive Group's automotive assembly and parts-making businesses. Shanghai Automotive Industry Corporation (SAIC) currently has joint ventures with GM and VW. Nanjing owns the rights to the MG Rover brand– and is busy dumping their current joint venture with Fiat. There are no known plans to terminate any other joint ventures, but as SAIC strengthens its position in the Chinese auto market, they'll be looking to cut loose their foreign "partners." Count on it.
Posts By: Frank Williams
When someone says "ugly car," names like Aztek, Sebring and Multipla always seem to pop up. The New York Times adds Aurora to that group. Arguably the ugliest prototype car ever built, the Aurora was the brainchild of priest-turned-auto-designer Alfred A. Juliano in the mid-1950s. The prototype was partially financed by his parishioners. His intent was to produce the world's safest car, using a totaled 1953 Buick as the platform. Unfortunately his lack of knowledge of automotive design and engineering trumped his enthusiasm and good intentions. Juliano was driven from the church and died penniless. Interestingly, production cars use some of his safety concepts: seat belts, side crash protection (offsetting the driver was his solution) and Euro-style pedestrian safety (the foam-filled cow catcher out front). The Aurora was rescued from oblivion, restored and now resides in a museum in Beaulieu, Hampshire, UK. You have been warned.
USA Today's financial markets repoter Matt Krantz gives Ford a Boxing Day black eye, warning his readers not to touch FoMoCo's stock with a proverbial ten foot pole. Krantz proffers his prognostication of doom based on four criteria. In the area of risk versus reward, the McPaper's market maven figures "you're taking twice the risk to get a shot at a smaller return." Looking at discounted cash flow, Krantz says if "you're looking for a bargain, you're not getting it with Ford at these prices." Based on the stock's current value compared to historic range, Ford is in the "sell" range, and "that's not good, either." Finally, Krantz rates Ford's overall financial health on a scale from 1 (healthy) to 5 (mortally wounded). The Blue Oval Boyz clock-in at… 4.3. Krantz leaves no words minced. "You can do much better… there's no reason to think Ford stock is worth taking a chance on yet." Incidentally, he also warns "General Motors' stock hasn't been much better" this year, in case you were considering an American automotive alternative.
Smart cars that keep themselves in the proper lane, maintain the correct following distance and sense driver fatigue are so passe. Now, thanks to researchers at Purdue University, your smart car can have smart tires. Reuters reports the net technology incorporates sensors that can detect problems like cuts, leaks, imbalance and improper mounting. A chip inside the tire probes the layers of the tire and relays information. The developer plans to patent the technology and license it to tire makers. He said it would cost the manufacturers about $1 per tire, but expects it'll add about $50 to the cost of a tire by the time it gets into consumers' hands. How smart is that?
Curious about the Chinese pickup truck market? China Car Times gives a rundown of what they consider the best-looking pickups offered to the people of the PRC. Their favorite is the Big Diesel God, with styling copped from Chevy and power by Mitusbishi or Toyota. They're also fond of the Great Wall Wingle, which looks more cute-ute than pickup. The Photon SaPu and Zhongxing Grand Tiger round out their round-up. From the looks of it, if the Chinese ever want to launch an attack on the small truck market in the U.S., they already have some pretty good ammo in their arsenal – not to mention some of the coolest model names for trucks since the Chevy LUV (Light Utility Vehicle).
The International Herald Tribune reports when House Speaker Nancy Pelosi sent the energy bill to the Prez for his John Hancock, it was delivered in a Toyota Prius owned by an employee with the Office of the Clerk of the House. Naturally, using a Japanese hybrid to deliver the bill pissed off two Republican representatives from Michigan. Rep. Candice Miller said it was done "just to demonstrate their complete disregard for the domestic auto industry." Rep. Mike Rogers echoed that sentiment, calling it a "slap in the face of every American auto worker." A staffer in Pelosi's office said the two were "merely attempting to distract from the success of the Democratic energy security legislation" and added that 95 House Republicans (fewer than half) supported the bill. He stopped short of saying "nanny-nanny-boo-boo." What I'd like to know is why a paper copy had to be delivered at all. After all, if the Democrats were that keen on conservation, they could have transmitted it electronically.
At the rate it's going, the first Chinese car sold in the U.S. might come from GM, assembled right here in North America. Currently GM buys 20 million parts per month from Chinese suppliers. Reuters reports they're increasing their spending by 25 percent a year through 2010. You can expect to see air conditioning, chassis, steering and brake parts coming from the PRC, in addition to the electronics, plastic parts, engines, aluminum wheels (half of the aluminum wheels they use worldwide are Chinese) and other Chinese-made components they currently use. If the trend continues, that "American-made" Chevy will soon have more Chinese content than domestic. An American revolution? I don't think so.
Reuters says the deal is done: GM has sold their medium-duty truck business to Navistar International Corp. The deal gives Navistar "intellectual property rights to manufacture GMC and Chevrolet brand vehicles in the class four to eight gross vehicle weight range and distribution rights for GM's medium-duty truck unit." Under the new ownership, production will move from GM's plant in Flint, Michigan to an unnamed Navistar facility. The terms of the deal were not disclosed, but its biggest benefit is supposedly allowing GM "to focus more on its core business of making cars and sport utility vehicles." That and pay off some of GM's debt. Or make the bottom line look good for the quarter. Or both.
Forbes reports the House Energy and Commerce Committee has passed a bill requiring federal regulators to devise clever caveats that make power windows safer, eliminate blind spots in jumbo-sized SUVs and pickups, and keeps vehicles from rolling away (and over young 'uns). What any of that has to do with energy or commerce is anybody's guess. Anyway, committee chairman John Dingell said the bill would "help protect these young victims by instituting common-sense safety provisions in the design of cars." Why nothing was said about instituting common-sense safety training for the drivers is another mystery for the ages. Sorry– there I go digressing again. Right. Where was I? Oh yes… Jacqueline Gillan, vice president of Advocates for Highway and Auto Safety, added "nobody should have to back out of the driveway without seeing what's behind them." Well, no one should get in their car to back out of their driveway without first looking to see if there's anything in the driveway, either. Damn! At any rate, the National Highway Traffic Safety Admission has to create the new regulations within three years of the bill's enactment– too late to save Jamie Lynn Spears' first baby.
MINI's mini-suv finally has a name. Auto Motor und Sport (via motoring.co.za) reports the maxi-MINI will be called the Crossman, continuing their theme of names that start with "C." The not-so-mini MINI will be built by Magna in Austria, marking the marque's first foray away from the UK's auto industry. MINI Magna expect to produce about 45K Crossmans (Crossmen?) a year after the model's 2010 launch. Crossman consumers can opt for front wheel-drive or all wheel-drive. So now we'll have the two-door Cooper, the Cooper convertible, the four-door Clubman and the Crossman. It shouldn't be too long before BMW completes the bastardization of the MINI brand by producing a pickup version, maybe called the El CaMINI.
Even as the Prez picks up his pens to sign the new Energy Bill into law, the automakers are rallying around the cause. While the cynical amongst you might suggest that their support indicates that the bill's riddled with loopholes, we couldn't possibly comment. Chrysler's (nee Toyota's) Jim Presshad no such reluctance. He told MSNBC "We now know what the rules are of the game. [Translation: We manipulated the legislation as much as we could.] Each manufacturer now will be able to play its hand in its unique way. [We'll game the rules to the max.] We're in the best position to marry technology and not make people make sacrifices or compromises on the product they want. [We're going to continue to build huge trucks, CAFE be damned!]" Rick Wagoner responded with Generic Press Statement #31: "We will focus our engineering and technical resources to attain these standards, and we remain hard at work applying the innovation and developing the advanced technologies that will power tomorrow's cars and trucks." Toyota's Jim Lentz just said they'll expand their range of hybrids. "We're a hybrid company." Uh huh. A hybrid company that makes a fortune off of gas-sucking trucks and SUVs. It's nice to know even as the rules change, it'll be business as usual.
Motor Trend (MT) has named the Tundra their Truck of the Year. Yes, "The new Toyota Tundra is now ready to take on any American-made pickup truck– on all levels." To get the gong, an aspiring pickup had to be new or redesigned in the 12 months before Jan. 1, 2008. So the only "American-made pickup trucks" that qualified were the heavy-duty versions of the Silverado, Sierra and F-series. Hang on; how come the new Tundra, introduced as an '07 model, qualifies? It's about as much as mystery as why MT considers "significance" one of their three judging criteria. Anyway, in their official reveal, MT spends a paragraph sloughing off the Tundra's well-publicized recalls and quality problems. "Our guess is many of these stories spread like wildfire, given the lightning-rod effect this new truck is having with enthusiasts and the speed with which an Internet item can travel." And of the latest recall for a soft joint in the rear driveshaft, they add, "(EDITOR'S NOTE: Testing, judging, and story for the February 2008 issue of Motor Trend were completed and printed before the latest safety recall involving 15,600 2007 Tundras to correct a potential driveshaft issue)" It's amazing how much spin a generous advertising budget can buy.
As we reported yesterday, Mercedes is working on anti-driver fatigue gizmology. Yahoo! Canada reports that Toyota has decided that the world needs more 'lerts. ToMoCo's recruiting the research team that developed Nintendo's "brain training" games to help them ride herd on driver alertness, specifically as it involves the elderly. Their wakeupmobile concept will monitor the helmsman's "brain activity, automatic nerve reflexes, attentiveness and other mental and physical conditions" and then stimulate the drowsy driver through a variety of means– including cranking-up the AC "to invigorate the driver's brain." Toyota hopes to put some of the systems they develop into use by 2015 to 2020. Nissan has also expressed interest in research in this area, but has made no decision to pursue it. No word from Buick who's rumored to be surveying their remaining customers to determine if A) they're still alive and B) they can understand the system's advantages.
The union between Chrysler and Chery is about to bear fruit. China Car Times reports a rebranded Chery A1 will go on sale in Mexico "very soon" under the Dodge banner. This is the same model they're looking at bringing to the U.S. once they meet safety and emissions standards, with a target of some time in 2009. Wall Street Journal drove an A1 in China last August and came away impressed: "the A1 performed admirably… the ride was surprisingly smooth and quiet.. At 100 miles an hour, there was only a slight vibration in the steering column." They noticed a few quality problems but decided "for such an inexpensive car [around $7K in China], it is hard to complain." There's no word yet on how inexpensive it'll be after it makes the trip across the Pacific.
If giving away the farm at this year's contract negotiations wasn't enough to convince you the UAW is getting soft in its old age, the Detroit News reports they're beginning a TV campaign to show their warm and fuzzy side. The ads direct viewers to IamtheUAW.org where they can view and share stories about the wonderful things the UAW has done for them (like agree to salary cuts), how secure their future is (with increased health care costs) and how the UAW is going to rid us of toxic toys. But instead of focusing on labor issues, the ads will highlight the charitable causes and community activities the UAW supports. UAW leaders say the ads "aren't intended to recruit more members but rather to raise awareness of the activities and positions of the union." Uh huh. So, why are they only airing the ads in Detroit, where they have to convince screwed-over autoworkers they're still the good guys, and Indianapolis, Indiana, Jackson, Mississippi, Louisville, Kentucky, and Nashville, Tennessee – market areas which include cities where the transplants have large assembly plants the UAW wants to organize?
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