Toyota is getting out of the carmageddon-caused and recall-related funk and is moving forward with worldwide expansion plans. According to The Nikkei [sub], Toyota has resurrected all key projects planned before the financial crisis. Read More >
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India is supposed to be the world’s next growth market. For one company, this is already more than true: For Japan’s Suzuki. The Maruti Suzuki joint venture owns more than 50 percent of India’s market. And soon, Suzuki will build more cars in India than back home in Japan. Read More >
The AP [via Google] reports that Tesla has revised its IPO offering to $14 to $16 per share, for a total capital raising of up to $185m. The WSJ [sub] estimates the IPO’s take at $178m. Previously Tesla had valued its offering at $100m. This revision is not inconsequential: the offering is now valued higher than Tesla’s cumulative revenue since 2003, which now stands at $147.6m. The company has lost nearly $300m since 2003, and will continue to lose money until the Model S sedan starts selling. Especially with $100m-$125m in capital expenditures planned for this year. GM’ it seems, won’t be the only auto firm sweating an IPO this year.
Ed does things that are bolder and bigger rather than small and timid. All things being equal, Ed would like it bigger versus small. But all things aren’t equal. He needs to get the government the best value for its stake, too.
Former AT&T exec James Kahan tells BusinessWeek what kind of IPO GM’s Chairman would prefer. Unfortunately for “Big Ed,” that’s not up to him. GM’s value must be determined by the market, and due to political pressure on the government to end its ownership of GM and Chrysler, it will have to happen as soon as possible. A fourth-quarter IPO with “about half of the government stake [being sold] to the 20 top institutional investors” is in the cards. So we know the government won’t get out of GM entirely in the IPO… but how much will the market give the Treasury for half of its 61 percent stake?
Doubtless somewhat shocked and surprised about GM Chairman/CEO/Non-Car-Guy Ed Whitacre’s decision to take over product planning responsibilities, Automotive News [sub] did some digging into the decision, and offers a full report. According to AN’s GM sources, the decision comes down to one fundamental goal: holding lower-tier executives accountable for decision making. By reducing executive reviews of forthcoming vehicles by one third, or about four times per development cycle, lower-level executives and engineers will have more freedom to make decisions, and will spend more time developing and less time preparing data for executive reviews. And lest you think this decision doesn’t merit your attention, consider this: though GM’s bureaucracy had created incredibly long lead times, most automakers hold about ten executive reviews per new product. By cutting to four, GM is taking something of a step into the unknown.
Last Friday, Chrysler celebrated the first anniversary of its miraculous emergence from bankruptcy. What did the employees get in observance of this occasion? A watch? A bonus? Read More >
Spyker, proud new owner of SAAB, is overwhelmed. Victor Muller is looking at what’s on his plate and is having an anxiety attack. “How will I ever get that done?” (And with what money?) Spyker needs serious help. Read More >
Whenever sales in China come up, there is an echo somewhere: “Sure, but are they making money?” “Name the average transaction cost in China.” “Profits? Everbody know profits can’t be taken out of China.” Thanks for your concern, but Nissan doesn’t have these worries. Read More >
I understand the economic argument for the off-shoring of production, but I think the practice is reprehensible. U.S. automakers have benefitted greatly from federal largesse and should feel morally compelled to retain and create as many domestic jobs as possible.
As one of the strongest proponents of the Detroit Bailout, Rep John Dingell (D-MI) carries some weight when he makes statements like this. But how can Detroit rise again by ignoring the undeniably strong “economic argument” for outsourcing? In a Bloomberg BusinessWeek feature, Thomas Black shows why production numbers are on the rise in Mexico, and makes the case that the Detroit automakers will only increase their reliance on Mexican production when they are free from government ownership.
Most likely filled with a certain degree of foreboding, Volkswagen signed today contracts with their joint venture partner FAW to build a new plant in the south of China, we hear from a Volkswagen press release. That VW has designs on building cars in the South of China is no news to the avid TTAC reader. But why the anxiety? Read More >
China’s Changan could make an own-brand car, based on technology acquired from joint venture partner Ford, says Automotive News [sub]. It would likely be a mid-sized sedan, based on a Ford platform. It would be produced in Changan’s plant in Nanjing, near Shanghai. Read More >
Once again Detroit finds itself atop Edmunds’ True Cost of Incentive ranking of the top seven automakers [via earthtimes], as the domestic OEMs spent about $1.7b (or, about 60 percent) of the $2.8b paid out by the entire industry on incentives last month. Trucks were the most heavily discounted segment, with average incentives running around $4,650, or nearly 13 percent of the average segment sticker price. Saab spent the most by brand, slapping an average of $6,813 on its vehicles, with Lincoln coming in second at $4,987 per vehicle sold. Saab’s incentives equaled 17.1 percent of its average vehicle price, while Chrysler gave away about 12.2 percent of its average vehicle price last month.
GM and Ford reported new monthly record sales in China, says the usually reliable government-owned China Daily. Really?
Ford said its China sales rose 17.8 percent. Ford is a relative nobody in China. File under “never mind.”
GM China’s May numbers are much more remarkable. They need to be carefully read. Tread carefully: Cleverly hidden landmines ahead! Read More >
The executive shake-ups show no signs of stopping at GM, as Ed Whitacre ended the week with yet another re-shuffle. And this time Whitacre himself is the big winner. Automotive News [sub] reports that Whitacre has assumed control of GM’s global product planning, leaving former planning boss Tom Stephens with the more prosaic responsibility of overseeing new product development. Whitacre will be assisted by new VP for product planning Steve Carlisle, who, unlike Whitacre, actually has some experience in product planning. Carlisle replaces Jon Lauckner, who will head up GM’s new venture capital unit. But the big news here is that a man who only just learned the term “segment” about five and a half months ago, is now in charge of GM’s global product planning. Quick learner or egomaniac?
The NHTSA has definitely shut down on-line access to attachments in their Office of Defect Investigation complaint database. It’s about time, but it isn’t enough. To quote Kris Kristofferson, the database has always been “a walking contradiction, partly truth and partly fiction.” The database has been abused for political propaganda purposes. Now, that it has served its purpose, the database is being shut down. Partially. They have locked away the only content that is of real value: The evidence. We preserved some. To show you what you will be missing. Read More >
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