Sadly, my internet came crashing around my ears just as GM’s Q1 results conference call was getting interesting. Typical Monday. I’ll rock myself to sleep tonight with a recording of the call and report back tomorrow, but at this point the big news is plainly visible on this single slide. Yes, GM finally got control of its incentives and wrestled them below the industry average… for a month. That month (March) also just happened to be the worst month this year for GM market-share wise. The next month (April), the incentives went back over the industry average, and market share increased once again. The lesson seems obvious: GM won’t gain market share on promises of high-quality cars and taxpayer payback alone.
Honda hasn’t always replaced its bread-and-butter compact, the Civic, every five years. The Mk.1 Civic soldiered from 1972 until 1979. The second through fifth generations were replaced on a regular four-year schedule, before Honda settled into a five-year product cadence with the sixth generation (1996-2000). If it were to keep with that cadence, we’d be seeing a ninth-generation Civic sometime this year, replacing the Mk.VIII, which debuted in late 2005. According to Automotive News [sub], however, Honda is holding off on releasing a new Civic until 2011. What gives?
What, you want more context from a headline? It’s not like we’ve lied to you or anything. Technically, every word of it is true. OK, OK, here’s the fine print: CGI Holding, owners of “Old Chrysler” and Chrysler Financial paid $1.9b of a $4b pre-bankruptcy TARP loan, according to Automotive News [sub]. Though far less than face value, that payback “is significantly more” than what Treasury was expecting in return. In other words, this is great news if you thought the bailout would be a complete loss. Otherwise, it means that the various remains of Chrysler have repaid $3.9b of the $14.3 invested by taxpayers into the company pre-bankruptcy… and unless Chrysler’s IPO brings in about $100b, Treasury will still take a bath on the rescue.
When we first heard that GM was eying a return to in-house financing, our first reaction was to worry that
the potential for falling back into old bad habits can’t be ignored.
Clearly our concern wasn’t wasted, as the AP [via Google] reports that The General’s major motivation for considering re-creating a captive lender is to chase subprime business its current major lender won’t touch. And considering that that lender is GM’s bailed-out former captive finance lender GMAC (now Ally Financial), which was badly burned by subprime mortgages, it’s not surprising that GM is frustrated by GMAC’s tentative approach. But should The General charge into the low-standard lending sectors where Ally fears to tread?
Hello: I have a question about a 2003 Toyota Camry with 130,000 miles. Every time I get the oil changed the attendant comes out with a clipboard and a long list of items needed to be done. Such as flush the engine oil, flush the power steering fluid, start using high mileage oil etc. Should I do this? So far I have not given in as the car runs good and it’s paid for.
Automotive News [sub] highlights a new trend in the car sales game: the luxury dealership destination. This picture was taken at Lexus of North Miami, which its owner describes thusly:
The new state-of-the-art dealership not only provides the ultimate in automotive service but also provides unrivaled personalized service, catering to all of your needs with luxury amenities via the Club Lexus Lifestyle and Fitness Center. The innovative, resort-like center is designed to accommodate and enhance your everyday lifestyle by allowing access to the finest facilities for consultation and first class amenities.
Ford’s Fiesta subcompact has earned a top EPA rating of 40 mpg on the highway, and 29 mpg in the city, reports Automotive News [sub]. Those numbers are for Fiestas equipped with an optional six-speed autobox; manual transmission models get a 37/28 mpg rating. By comparison, auto-equipped versions of competitors like the Honda Fit (35/28) and Toyota Yaris (35/29) come up short on highway mileage in particular. But this isn’t the first time Ford has claimed 40+ mpg for one of its cars: the Fusion hybrid carries an EPA city rating of 41 mpg, despite coming up short of its government-endorsed rating in several real-world tests (although not as shockingly as Chevy’s Equinox, for example). But the EPA testing regime is hardly perfect anyway, so let’s just wait and see what the test drives yield before we start stringing up the piñata.
Now that GM has released its Q1 data, let’s have a look at the race for the top spot, world’s largest auto maker. We are counting global deliveries only, not production. Even with “deliveries” there is room for interpretation. Deliveries to customers? Or cars dumped on dealer lots? We’ll never know. All we know is: Read More >
Whereas Chrysler’s surprise operating profit in the first quarter of this year was achieved mainly through cost-cutting, GM’s just-announced Q1 profit comes on the strength of sales increases in most of its global markets. Though The General’s sales numbers are still lower than they need to be, momentum is headed in the right direction… albeit somewhat more slowly than had been hoped.
With ballot initiatives and other possible legislative action threatening to put a major photo enforcement company out of business, an effective public relations strategy has become the firm’s top priority. Redflex Traffic Systems on Friday had its former corporate spokesman, Michael Ferraresi, return to writing about the industry for the Arizona Republic newspaper, which covers the battleground market of Phoenix. Read More >
Well, the suspense is over. General Motors announced its Q1 earnings this morning, and for the first time since 2007 the quarterly numbers are positive. GM’s net revenue jumped to nearly $31.5b on strong performances from its North American and GM International Operations (GMIO), and across-the-board sales improvement for the Chevy brand. General Motors Europe was The General’s sole unprofitable division for the quarter, losing half a billion dollars while it waits for a deal on financial assistance to clear. Operating cash flow was $1.75b, with about $755m of that going towards capital expenditures. That left just under a billion dollars in free cash flow, as GM finished the quarter with $35.7b in cash on hand. Net income attributable to shareholders was $1.068b, less $203m for cumulative dividends, for a total net profit of $865m [Full financial highlights in .doc format available here].
Despite suffering from a market-induced sales conflagration at home and in Europe last April, Volkswagen can pat itself on the shoulder for outperforming the global market. In the first four months of 2010, the world bought 20.9 percent more Volkswagen Group cars than in the same period of last year. That versus an 18.1 rise of the general market.
VeeDub’s bacon was saved by China and Brazil, “where Volkswagen is particularly successful,” said a proud VW sales Chief Christian Klingler today. Looking forward, he’s hedging his bets. “Despite the very positive performance to date, we remain cautious about our forecast for the full year. It is still very difficult to predict macroeconomic developments,” a Volkswagen communiqué cites Klingler.
A good old friend is coming back to China: The Jeep. Guangzhou Automobile Group Co (GAC) is expected to produce Chrysler’s Jeep at its Changsha-based joint venture with Fiat, Gasgoo reports. Read More >
The European Automobile Manufacturers’ Association ACEA released sales numbers for April. As predicted on Friday, the numbers are bad. For the first time this year, and for the first time in 10 months, numbers are negative. New passenger car registrations in Europe fell by 7.4 percent in April compared to the same month last year. They will get worse. Read More >
Congressional lawmakers are mad at Toyota. What has Toyota done now? Their sin this time: They may have harbored a secret “attack plan against congressional testimony.” This, says the Washington Post, has “drawn the ire of the House Energy and Commerce Committee.” Read More >
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