We have been pointing it out for quite a while:Something counter-intuitive (and counter- conventional wisdom) is happening in China: While the growth of the general market is slowing down, it is at the expense of the Chinese brands. The foreigners are doing fine.
Nothing illustrates this better than the story of the two Gs, Geely and GM. In October, the growth of the Chinese market effectively came to a halt.
How did the two Gs fare during that braking maneuver? Read More >
The China Association of Automobile Manufacturers (CAAM) released its October sales, and they confirmed the rumors that they were nothing to write home about. Total automobile sales are down 1.07 percent compared to October 2010. Production rose less than 2 percent. Passenger vehicles still outpace the overall market, up 1.42 percent. Read More >
GM’s China chief Kevin Wale poured a huge bucket of ice-cold water over hopes that China’s Pangda and Youngman will rescue Saab. The deal needs to be approved by the Chinese government, the European Investment Bank, the Swedish government and – GM.
Wale told Reuters today: Read More >
In China, rumors of empty showrooms during the important Chinese October holidays made the rounds. It must have been different showrooms than GM’s. GM China announced a fresh October sales record of 220,412 units. October sales across all brands of GM China were up 10.4 percent.
The surprising part is that SAIC-GM-Wuling jumped 19.2 percent year on year to a new record for the month of 111,957 units. It was this joint venture that had dragged GM China’s numbers down in the previous months. Read More >
While the flagwavers at Saabsunited wallow in the good news that the Swedish king announced at an annual moose hunt near Trollhättan that Victor Muller is a great guy, far away in Detroit, GM spokesman Jim Cain issued to Reuters what sounds like the death sentence to the sale of Saab to China’s Youngman and Pangda:
“GM would not be able to support a change in the ownership of Saab which could negatively impact GM’s existing relationships in China or otherwise adversely affect GM’s interests worldwide.”
The exactly same statement was sent to the Wall Street Journal, and GM will send it to anyone who asks what GM thinks of the deal. If Muller would have asked before announcing the sale, he most likely would have received the same answer.
Translation: Read More >
China’s People’s Daily, the newspaper owned by the (alleged) communist party, carries a sobering analysis of the state of the Chinese auto industry. It is not that it will crash in to oblivion as some predicted. But it will not grow as fast as automakers build factories. Serious overcapacity and possibly the long predicted shakeout of China’s chaotic auto industry will be the likely result:
“China’s automotive market has suddenly entered an adjustment period and almost all the automotive enterprises of China were caught unprepared. Since April 2011, the automotive output and sales volume have both been declining for three successive months. Read More >
China’s Dongfeng makes a lot of cars with several joint ventures. It also makes its own cars. In a way. It’s ode to the Hummer is legend. Now, Dongfeng found inspiration in another legend: The Unimog. At a show in Shanghai, Carnewschina found the Dongfeng v-Tiger, or EQ2070FQJ, which it says is a spitting image of Daimler’s inconic Unimog workhorse. Well, that’s up to debate. One thing isn’t: Read More >
The Nikkei [sub] says that Nissan will move the (or a) headquarters of its Infiniti brand to Hong Kong, and that Nissan “will begin manufacturing Infiniti-brand vehicles in China as early as next year, becoming the first Japanese automaker to produce luxury cars in that nation.”
Not so fast, say close-to-the-matter contacts in Yokohama. Read More >
I’m sure you know the stage trick where a woman is sawed in half and lives. Now, try the same with a Volvo and a truck loaded with masses of steel bars. Volvo S40 crashes into truck. Bundles of steel bars crash through the windshield, exit on the other side of the car. What happens to the driver and front seat passenger? Read More >
Today, Saab creditors met in a packed-beyond capacity courtroom on Vänersborg. After a short deliberation, the district court approved the reorganization plan, Göteborg’s Posten reports. It will cost 500 jobs in Trollhättan. On Friday, China’s Youngman and Pangda had agreed to take over Saab 100 percent – in a Memorandum of Understanding, which isn’t worth much, and which is littered with caveats.
The reorganization plan, (full text here), was feted in a lengthy press release. It starts like this: Read More >
There may be a deal in the works to return GM’s golden share in the increasingly important joint venture with China’s SAIC. It will be a skewed trade: The joint venture will go back to 50-50. In return, a sales company will be set up, which is majority controlled by SAIC in a 51-49 joint venture. SAIC will be controlling the most important aspect of the car business: The selling of cars.
In 2009, GM sold one percent of the 50-50 partnership.to SAIC for a token sum of $85 million. Officially, this was to allow SAIC to reflect the JV’s earnings on its books. New Chinese accounting rules say that the earnings can only be reflected if there is substantial control of the company. People had scratched their heads back then – if this share is so important, then why was the price so low? In a 10-K filing, GM explained later: Read More >
On the last possible day to work out a deal before being forced into bankruptcy, the Victor Muller era has ended at Saab. The Swedish brand will now become a completely Chinese-owned company… if all goes to plan. A press release explains
Swedish Automobile N.V. (Swan) announces that it entered into a memorandum of understanding with Pang Da and Youngman for the sale and purchase of 100% of the shares of Saab Automobile AB (Saab Automobile) and Saab Great Britain Ltd. (Saab GB) for a consideration of EUR 100 million…
…The administrator in Saab Automobile’s voluntary reorganisation, Mr. Guy Lofalk, has withdrawn his application to exit reorganisation. The MOU is valid until November 15 of this year, provided Saab Automobile stays in reorganisation.
But remember, this is Saab… and its fate rests in the hands of many, many people not named Victor Muller. Despite the air of finality that is surrounding some of the media coverage of this latest announcement, this is not a done deal. The Saab saga rolls on…
If you’ve followed TTAC for the last several, you’ve been able to watch the meteoric rise of Build Your Dreams from humble upstart to Buffett-backed behemoth. Two years ago, BYD seemed poised to launch an unstoppable onslaught of cheap Chinese electric cars that seemed like an attractive proposition at a time when gas price angst was everywhere. Today, however, things have changed considerably. Bloomberg reports that BYD has opened its US headquarters in Los Angeles, a year behind schedule, and with fewer jobs than initially promised. And no wonder: for all intents and purposes, BYD has practically abandoned its charge to leverage its cell phone battery know-how into electric car dominance. According to Bloomberg, BYD
“has delayed plans to sell electric cars to retail buyers, citing limited availability of public chargers. Instead, it’s focusing on solar panels, batteries, LED lighting and rechargeable buses.” Read More >
With a Halloween deadline to get its restructuring back on track looming, Swedish Automobile has rejected an offer by Youngman and Pang Da to buy 100% of Saab’s shares. Moreover, the struggling Swedish brand has canceled the existing agreement with Youngman and Pang Da, its erstwhile would-be rescuers. A Saab presser notes:
Today, Swedish Automobile N.V. (Swan) announced that it has given notice of termination with immediate effect of the Subscription Agreement of July, 2011 entered into by Swan, Pang Da and Youngman.
Swan took this step in view of the fact that Pang Da and Youngman failed to confirm their commitment to the Subscription Agreement and the transactions on the agreed terms contemplated thereby as well as to explicit and binding agreements made on October 13, 2011 related to providing bridge funding to Saab Automobile AB (Saab Automobile) while in reorganization under Swedish law.
Pang Da and Youngman have presented Swan on October 19 and 22 with certain conditional offers for an alternative transaction for the purchase of 100 percent of the shares in Saab Automobile which are unacceptable to Swan. However, discussions between the parties are ongoing
One of the earliest iterations of the “Low Speed Vehicle Today, World EV Domination Tomorrow” business model to emerge at the dawn of the electric car era was ZAP. But after being exposed on numerous occasions for its poor product quality, vaporware hype and stock manipulation (most infamously in this Wired story), ZAP disappeared from the EV scene in the US (the company’s official (read: sanitized) history can be found here). Last we heard, ZAP was hyping a venture with the Korean optics firm Samyang, but it seems the firm has spending the last year or so putting down roots in the Chinese market. Having merged with Jonway, the Chinese maker of scooters, ATVs and a CUV that looks suspiciously like the Toyota RAV4, ZAP came back to the US for the Automotive X-Prize, which it contested in a ZAP Alias, the three-wheeled, $38k vehicle that has not been produced in volume although the company is still accepting deposits for it. The Alias failed to finish in the X-Prize, but ZAP says that revenue from Jonway is funding the vehicle’s continued development (including a four-wheeled version)… which was supposed to debut way back in 2009.
Now Consumer Reports says the firm is focusing on selling electric RAV4 knockoffs produced by Jonway as it continues to work on the Alias. But the firm seems to have burnt too many bridges in the US, as it says it will focus on selling the EVs in China and other world markets… despite the fact that developing market EV sales are going nowhere. But ZAP has left something of a legacy in the US: Senator Mitch McConnell, a critic of government loans for Solyndra, apparently pushed for a quarter-billion dollar federal loan to ZAP, opening him to charges of hypocrisy. Now, as ever, ZAP remains a fascinating fixture at the margins of the EV scene. And though it’s an interesting company to watch, it’s best when viewed from a safe distance…
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