Renault may be playing Russian Roulette, but at least it seems the French automaker is finally playing nicely with Avtovaz and the Kremlin. Maybe the thought of ending up like Mikhail Khodorkovsky spurred Carlos Ghosn into action? Or maybe Ghosn came around when he found out that the Kremlin is going to put $1.7 billion into the ailing Russian car maker. The St. Petersburg Times reports that Renault will invest a mere €300 million in the form of of a technology transfer so that Avtovaz can start building the Logan, Renault’s smash hit in Eastern Europe. It’s like the Fiat-Chrysler deal, only cheaper! Renault will also help Avtovaz develop a new car to replace the Zhiguli (I’d never heard of it, either). Some of this production will happen in Russia’s far east and Renault’s Japanese subsidiary is there to help!

Read More >

The Brazilian-American Chamber of Commerce reports that Volkswagen AG has announced it plans to build (cue “Dr Evil” voice) 1 million vehicles in Brazil by 2014. To help this grand notion become a reality Volkswagen will invest €2.3 billion (about $3.5b) into the endeavour benefiting its two assembly plants in Anchieta & Taubate and its engine plant in Sao Carlos. Volkswagen aren’t far off this target; this year Volkswagen expects to manufacture 800,000 vehicles in Brazil. Brazil is also Volkswagen’s third largest market after China and Germany, respectively, so there’s plenty of demand for the Wolfsburg Warriors’ offerings, with deliveries to customers up 70% since 2005. If Volkswagen cars are suffering from alleged reliability issues, it doesn’t seem to be bothering our Brazilian friends.
Read More >

When cars and politics collide, the results are rarely pretty. No wonder the political discussions here at TTAC so often rate amongst our most heated and community standards-challenging. Modern cars are machines of great power, facilitating a great deal of freedom but also carrying undeniable consequences, and their position in modern society demands a constant re-evaluation of their terms of use. Some of TTAC’s gripes on car-related policy may lead some to believe that we harbor ulterior political motivations for our coverage, but the truth of the matter is that our principles are simple and directly car-related. If our political coverage sometimes seems petty, it’s because American motorists have relatively little to complain about. In Russia, however, motorists find themselves under assault by import bans, draconian tax increases and corrupt traffic police. And as the New York Times documents, it takes a lot to push motorists into political awareness, but once pushed their eloquent defense of their automotive rights is nothing short of inspirational.
Read More >

While Ford are making some headway in North America, their real Western Hemisphere focus is on the growth market of Brazil. Bloomberg reports that Ford will invest 4 billion Brazilian Reals (that’s $2.3 billion to you lot, I only deal in UK pounds) on Brazilian production capacity. Naturally, Ford aren’t doing this alone, the Brazilian government are offering the usual (as yet undisclosed) state and federal tax breaks to Ford. The investment will add to Fiesta capacity at the Camacari factory and help modernize the Troller plant that builds utility vehicles. Ford’s Q3 pretax profit in South America fell nearly in half to $247 million, as revenue dropped 22 percent to $2.1 billion. Though Ford blames currency issues for the drop, soon-to-expire government incentives have been keeping the Brazilian market afloat. Maybe it’s not “Fiesta” time yet.

Yesterday Daimler announced that McLaren would be buying out Daimler’s interest in their joint venture Formula 1 team. Many, including board member Erich Klemm, thought this made all kinds of sense. “In the (car) factories, every cent is being turned over three times. The employees are feeling the financial crisis with shorter working hours and loss of income,” he continued. “In these economically difficult times, the company should invest in better marketing of its real cars.” My, what a novel idea!

Read More >

Reuters reports that Aabar Investments is considering increasing their stake in Daimler AG from 9.1% to 15%. Aabar is already Daimler largest shareholder and this move, should it happen, will further cement this position. The Abu Dhabi investment fund paid $2.7 billion for the 9.1% stake when the share price €20.77. Since then, the share price of Daimler has rocketed 77% and on the news of Aabar mulling a bigger stake, the share price rose by 4.4% to €35.81 per share. Daniel Schwarz, an analyst with Commerzbank AG said “It’s a positive signal that a large shareholder is showing a long term commitment”. But the strength of the fund’s love for Daimler doesn’t just extend to this increased stake.

Read More >

Renault may be about to learn the folly of buying into a Russian company with close ties to the Russian government instead of establishing a presence of their own. Renault recently took a 25% stake in Avtovaz and things have gone from bad to worse. Avtovaz cut its staff by 25% and is now teetering on the brink of bankruptcy. Which is why Russia’s deputy prime minister, Igor Shuvalov, on Sunday said “If the Renault-Nissan alliance wishes to increase its participation to the point where it takes control, Russia will not be against it,”. He then went on to say “we will have to go to other potential partners and investors,”. These are the words which Renault should pay close attention to.
Read More >

The Economic Times of India reports that Tata is considering offering knock-down kits of its Nano microcar and allowing franchisees to offer the world’s cheapest car as a private-label brand. The move is being considered as Tata’s dedicated Nano plant is still ramping up to its 350k unit annual production level, and the company is still having a hard time filling demand. Can’t you just see twelve-packs of Nanos at Costco?

We do have the ability, if it’s necessary, to provide support directly, but again that’s only if necessary… We are able to run a global business

GM CEO Fritz Henderson in the Detroit Free Press, explaining that GM is allowed to spend US -government bailout money on overseas operations, in this case, Opel. According to the Freep’s paraphrase of Henderson, “the terms of the prebankruptcy loans and the new government financing are different.” So why did GM insist just weeks ago that it wasn’t allowed to spend US taxpayer money on a $413m Daewoo rescue? Has GM been shuffling bailout cash to mismanaged overseas operations? Or would an Opel rescue mark the first time this had happened? In any case, wasn’t GM saved to prevent disaster in the US economy rather than stop job loss overseas? The unintended consequences of bailout keep marching on… and so will our search for answers to these questions.

Opel’s union boss and chief thorn-in-the-side for GM’s attempt at regaining control of its European division, Klaus Franz, recently met with CEO Fritz Henderson and is telling German media that “Henderson agrees that Opel should be led back to its traditional strengths in Europe, with a high level of independence  and autonomy within the GM organization.” But Franz is looking for more than kind words from Fritz, namely a future Opel share offering. “This way, GM can prove that it’s serious about Opel’s independence,” Franz tells RTL. Franz and Opel’s employees want a complete business plan along the lines of the one they’ve been negotiating for the past year and a half. Meanwhile, GM has also said that it will pay back the remaining €600m ($900m) worth of German government’s bridge loans by the end of the month. Between the Moody’s report that GM needs $8.5b to turn Opel around and the division’s continued desire for independence, a solution to the situation won’t be easy or cheap. It may be in GM’s strategic interests to keep Opel under its wing, but to what extent and at what cost?

Well, the “what makes an American car American” debate just got a little more interesting (and a lot more interesting than the “who ‘won’ the CTS-V Challenge” rigmarole). Automotive News [sub] reports that Ford’s Oakville, Ontario plant and GM’s Delta Township plant have ceased production of Flex, Edge, MKX, MKT, Acadia, Traverse and Enclave as supplier Rico Automotive is unable to supply key transmission components. The reason for the parts stoppage: labor violence… in India. Turmoil at Rico’s plant in Gurgaron (30 miles from New Delhi) came to a head on the 18th, when clashes between temporary workers and factory staff left an employee dead. Now GM stands to lose 7,200 units of production, while Ford admits “several thousand” units won’t be built over the next week. This striking illustration of how globalized the auto industry is, is causing some analysts to question the wisdom of using Indian suppliers. They argue that labor unrest like this is common in the subcontinent, compounding already-challenging logistical and shipping-cost issues. But GM and Ford aren’t exactly about to stop investing in Indian firms and production capacity either, since that market shows more growth potential than the US. One thing is for sure: there’s no such thing as an “American car,” let alone an “American car company” anymore. Government ownership notwithstanding.

The recent arrest of a Ford employee on charges of industrial espionage may have been enough to scuttle Ford’s sale of Volvo to Chinese firm Geely. Or, as Bertel Schmitt reports, perhaps the spy story was just a convenient excuse to get more money out of the deal. But whether as a legitimate concern or strategic fearmongering, industrial espionage is hot right now. The Freep reports three former GM-Daewoo employees have been charged with spycraft, for allegedly transferring “critical GM technology” to Russian automaker tagAZ. The technology in question: engine and component designs for Daewoo’s outgoing (J-200 model) Lacetti, predecessor to the Cruze. And GM claims tagAz’s new C-100 sedan (above) looks a little too similar to the Lacetti in question. “It’s pretty close, if not dead on,” say GM-Daewoo spokesfolks. “The J-200 may not be a new vehicle for a lot of developing countries, but for a lot of emerging markets, it’s a very aspirational vehicle.” And it’s been a best-seller in Russia. TagAZ denies that it stole designs from Daewoo, saying it spent four years and $250m developing the C-100. But it also hired “a number” of former Daewoo engineers, according to GM, which is probably the most legitimate way to steal a good design. But with GM possibly wavering on the Opel deal, will this latest espionage raise doubts about the wisdom of selling Opel to another Russian firm? It probably should.

Speaking of GM’s “May the Best Car Win,” Renault is telling its dealers exactly how to convince potential customers that competitors’ products suck. Our French-speaking friends are invited to offer translations of Cardesiac‘s article below. Mais moi? Non. For pure entertainment value (a TTAC hallmark j’espere) I prefer Yahoo’s babel fish. To wit: “And for this reason, nothing is worth tacler a little the competitors with some arguments felt well to underline their defects, to start with the most sharpened of them: Ford Focus RS. And Renault is not tender: design close to the universe of the tuning, completions to be perfected, alarming consumption and tax CO2 (weight), disappointing motricity (nose gear sometimes floating in acceleration, resources limited under 2.000 tr/min,…), imperfect guidance of box, diameter of too large steering (12,2 m), height adjustment of the seats before tiresome, not of more radical choice of suspensions in option and little choice of personalization.” Tacler? The mind boggles. Anyway, Renault misunderstands a sales basic: a new product’s greatest competitor is the customer’s existing product. The easiest thing for a car owner to do is to keep doing what they’re already doing. Instructions on how to tell buyers thir current car is crap; now that I’d like to see.

I understand the idea of retro-inspired cars. Well, in theory anyway. But could someone explain why Mercedes would chose to crib the rear end of a 1998 Acura CL for their SLS AMG?