China isn’t the only big economy coming to play (sorry to burst your bubble, Herr Schmitt). [ED:No bubble. India is 10-15 years behind China, but they will definitely be next. China and India added will be a monster.] Just across the border, India is rising up and quickly, too. Car makers are desperately scrambling to get a foothold in the Indian market. And like the Chinese market, everyone is enjoying record growth in India. Well, almost everybody. (Read More…)

There’s no replacement for displacement? Sure, as long as you own an oil well. If you want to save gas, there are three ways to do it:

1. Make the car as light as can  be (you can’t fool Newton.)
2. Use the smallest amount of displacement you get get away with, and make it up with direct injection, a turbocharger, and computer smarts.
3. Combine 1 with 2.

And what’s the easiest way to reduce displacement? Lose cylinders. That way, you also lose a lot of internal friction. If “Laufkultur” is part of your vocabulary, don’t read further, you’ll get sick. If you want to sick it to Big Oil, by all means, read on. (Read More…)

New car registrations in Italy fell 18.9 percent in September to 154,429 vehicles. Of course that means major pain for Fiat, which holds about 30 percent of the market. Actually, more than major pain: Fiat’s sales in their home market cratered by 26.3 percent to just 44,161 vehicles in September. That according to Transport Ministry data, published by Reuters. And what did Sergio Marchionne have to say to that disaster? (Read More…)

A few weeks ago, one of our overabundance of resident Germans wrote about how Volkswagen wanted to marry the Italian bride, Signorina Alfa Romeo. The project was colloquially called “Italian dressing” (Those Germans and their crazy sense of humor(!)). But it was soon dismissed as a throwaway comment from a company hell-bent by taking over ze vorld. Well, now Piech himself is getting involved, and if Piech wants something … (Read More…)

Did you know that Champagne, as we know it, wasn’t invented by the French? It was invented by the British. Christopher Merret documented the addition of sugar and molasses to a finished wine to create the bubbles in Champagne. This was six years before Dom Perignon (the supposed creator of Champagne) went to the Abbey of Hautvillers. And 40 years before Benedictine supposedly created Champagne. Merret presented his paper to the Royal Society which detailed the process now known as méthode Champenoise in 1662. Did that surprise you? Now check this out… (Read More…)

Despite not having spent a dime on the US firm, Fiat is widely credited with “rescuing” Chrysler. Here’s another way of looking at it: the United States taxpayers bailed out Fiat, an Italian firm with no presence in the US market. For no money down, Fiat got a 20 percent stake in a Chrysler that, although troubled, had been rinsed clean in bankruptcy. Now, analysts looking at Fiat’s spin-off of its automotive unit are telling Automotive News [sub] that

UAW boss Bob King is taking the fight abroad, visiting Fiat’s Italian plants in order to take a look at the World Class Manufacturing system that apparently has not yet sufficiently taken hold at Chrysler’s plants to be viewed there. But the visit isn’t purely social. King tells Reuters that

We’re going to be pitching to suppliers that they should come and locate here in Michigan.

Because clearly everybody wants to do business with the UAW. Heck, American supplier firms are falling over themselves to move production to Michigan, but King just thought it would be nice to give the Italians a first crack. On the other hand, Italy hasn’t exactly been free of auto-sector labor strife itself. At least King can pitch Italian suppliers by explaining that, as majority stakeholder in Chrysler, the UAW makes Fiat-Chrysler’s US labor environment a lot less complex: all you have to do is keep the union happy. So much for Marchionne’s “culture of poverty.”

Wolfsburg must be fuming. Among all the good news coming in from all corners of the earth, there’s a market that insists on being the proverbial thorn in their side. That’d be my little ole Brazil, which is, en passant, the world’s fourth largest. And it’s a market where Volkswagen has been nearly forever. Well-known Brazilian automotive journalist Fernando Calmon, writing for the just-auto website, reports a major shakeup in automotive brand values in Brazil (can you feel the ground shaking a little?). Mr. Calmon, citing the Brand Finance consultancy, reports that the most valuable car brand in Brazil is… (Read More…)

Chrysler execs met with some 400 potential Fiat dealers today to discuss plans for a new network of Fiat and Alfa-Rome brand stores in the US, and as we have noted, a certain amount of overlap can be expected. Chrysler says that “as many as 200” stores could be opened for the Italian brands, but the company has only identified 119 metropolitan markets in 38 US states where it projects sales growth in small car sales. Even with only “about 165” stores planned for the initial rollout, quite a few markets could host dueling Fiat/Alfa stores. According to the NYT’s Nick Bunkley, Idaho, Iowa, Alaska, Mississippi, Montana, New Hampshire, South Carolina, The Dakotas, Vermont, West Virginia and Wyoming will not receive Fiat/Alfa dealerships. Meanwhile, the AFP reports that Chrysler plans to sell 50,000 Fiat 500s in 2011 alone, meaning each of the 165 stores will sell an average of 303 units per year.

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„I’ve said Alfa is not for sale“ grouched Fiat’s Sergio Marchionne at journos who badgered him about Alfa possibly going to Volkswagen.  While he was at it, Sergio told Automobilwoche [sub] that business is so good that he probably will raise year-end guidance in the third quarter.

The enthusiasm for the Fiat coming to the market has diminished. At first, it was something that would be mixed in… now [Fiat-Chrysler is] going to have to present a compelling story and product to back me investing at least $1 million to build a new showroom

Everyone loves the Fiat 500, but Chrysler’s dealers aren’t exactly thrilled that they have to build brand new showrooms to sell the Italian (er, Mexican) subcompact, as witnessed by the quote above in the WSJ [sub]. Another dealer adds that he knows enough troubled MINI and Smart stores to be spooked by the prospect of dropping hundreds of thousands of dollars on what will clearly be a niche offering. Yet another calls it an “excellent opportunity,” but Chrysler needs to find 200 qualified dealers to make Fiat’s American adventure a reality. The credit and car markets, gas prices and Fiat’s less-than-stellar American-market legacy all conspire against the scheme. To say nothing of the poor historical precedents for Chrysler’s ballooning brand portfolio. But as usual, CEO Sergio Marchionne has it all figured out…

(Read More…)

Automobilwoche [sub] picked up strong signals that Volkswagen is interested in adding Alfa Romeo to their growing roster of brands. Last December, Marchionne had put Alfa on strategic review, and gave the brand, as Ed Niedermeyer put it so delicately, “a year to get its proverbial shit together.” They popped some Imodium, and  in April, Marchionne was “determined” to build the brand into a “full-line premium carmaker.” Nevertheless, here and there whispers had popped up that Alfa could be sold if the right buyer would show. (Read More…)

A few weeks ago, I wrote about how Sergio Marchionne was successful in getting the majority of the unions at his Naples plant to sign a new work agreement. This was supposed to herald in a new era in Italian work practices and pacem in terris. Well, it seems that Fiat wants to press the issue home to the unions. Reuters reports that Fiat is so determined to teach Italian unions at their Pomigliano plant that their working practices are not sustainable, that they are now going to some extreme lengths. Fiat is now going to set up a new company to manage the plant near Naples. Doesn’t sound extreme, right? Well, there’s more. (Read More…)

“The only reason we are not making money on the net is that I pay interest on the borrowings I took from the government and I have money in the bank to cover that debt. Actually, against the Treasury we owe them nothing. We have enough cash to pay it all off. But you can’t run a business without cash, so it’s just a function of our capital structure. If we had taken those funds as equity as GM did, we would have been making money, net, right now.”

(Read More…)