The Truth About Cars » Consolidation http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Fri, 05 Dec 2014 13:07:05 +0000 en-US hourly 1 http://wordpress.org/?v=4.0.1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Consolidation http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com/category/news-blog/consolidation/ Marchionne: New No. 1 Manufacturer Could Arise From Mergers http://www.thetruthaboutcars.com/2014/10/marchionne-new-1-manufacturer-arise-mergers/ http://www.thetruthaboutcars.com/2014/10/marchionne-new-1-manufacturer-arise-mergers/#comments Thu, 09 Oct 2014 14:00:34 +0000 http://www.thetruthaboutcars.com/?p=928018 Fiat Chrysler Automobiles CEO Sergio Marchionne — who will be retiring from the company after the next five-year plan runs its course after 2018 — believes mergers between automakers will one day result in a new No. 1 automaker. According to Bloomberg, the driving factor in creating an automaker above Toyota on the global manufacturer […]

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Sergio Marchionne - FCA

Fiat Chrysler Automobiles CEO Sergio Marchionne — who will be retiring from the company after the next five-year plan runs its course after 2018 — believes mergers between automakers will one day result in a new No. 1 automaker.

According to Bloomberg, the driving factor in creating an automaker above Toyota on the global manufacturer podium will come down to money and competition, as automakers will likely need more of the former to develop and produce new vehicles while also fending off all comers, merging with potential partners as needed.

As far as FCA is concerned, chair John Elkann says the company would be ready to consolidate resources with another within the next five to 10 years “if it makes sense” to do so. The company would look outside of Europe for a partner if and when the time comes.

For now, FCA plans to take sixth place by expanding sales on the strength of new models, such as the upcoming Jeep Renegade and the reintroduction of Alfa Romeo to the United States market. The automaker aims to deliver 7 million units in 2018, compared with 4.4 million in 2013.

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Buffett Enters Dealership Business With Van Tuyl Group Purchase http://www.thetruthaboutcars.com/2014/10/buffett-enters-dealership-business-van-tuyl-group-purchase/ http://www.thetruthaboutcars.com/2014/10/buffett-enters-dealership-business-van-tuyl-group-purchase/#comments Mon, 06 Oct 2014 12:00:46 +0000 http://www.thetruthaboutcars.com/?p=926441 Warren Buffett — no relation to Jimmy — is a lot of things: investor extraordinaire, railroad magnate, newspaper mogul, hip-hop enthusiast et al. As of last Thursday, however, he picked up a new title: master auto dealer. Bloomberg reports Buffett’s Berkshire Hathaway purchased Arizona-based Van Tuyl Group, the largest privately owned auto dealership group in […]

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Grand Re-Opening Of Jay-Z's 40/40 Club - Inside

Warren Buffett — no relation to Jimmy — is a lot of things: investor extraordinaire, railroad magnate, newspaper mogul, hip-hop enthusiast et al. As of last Thursday, however, he picked up a new title: master auto dealer.

Bloomberg reports Buffett’s Berkshire Hathaway purchased Arizona-based Van Tuyl Group, the largest privately owned auto dealership group in the United States, for an undisclosed sum. Namesake Larry Van Tuyl will continue to run the show, especially with Buffett’s plans to scale operations significantly.

The purchase is a bet on the consolidation of the dealership industry overall, as a handful of groups — like AutoNation, Group 1 and Penske — come into more dealerships; Van Tuyl operates 78 in 10 states, including Arizona, Texas and Nebraska.

Once the paperwork is sorted in Q1 2015, the group will be renamed Berkshire Hathaway Automotive. The group has over $8 billion in revenue.

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Volvo Restructuring To Three Families, Configurations By 2019 http://www.thetruthaboutcars.com/2014/08/volvo-restructuring-three-families-configurations-2019/ http://www.thetruthaboutcars.com/2014/08/volvo-restructuring-three-families-configurations-2019/#comments Fri, 29 Aug 2014 10:00:44 +0000 http://www.thetruthaboutcars.com/?p=903194 By 2019, the face of Volvo will change as the Sino-Swedish automaker begins restructuring its offerings, with the new XC90 leading the way. Autoblog reports Volvo will align its lineup portfolio around three families (40, 60, 90) and three designations/configurations (S sedan, V wagon, XC crossover). In turn, the 40 family will share a platform […]

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Volvo-XC90-2015-119

By 2019, the face of Volvo will change as the Sino-Swedish automaker begins restructuring its offerings, with the new XC90 leading the way.

Autoblog reports Volvo will align its lineup portfolio around three families (40, 60, 90) and three designations/configurations (S sedan, V wagon, XC crossover). In turn, the 40 family will share a platform with parent company Geely’s offerings, while the 60 and 90 families will use Volvo’s SPA modular platform.

Additionally, the V40/V60/V90 wagons will have a Cross Country variant, matching up with Audi’s and Subaru’s offroad formula for their respective non-rugged base offerings. Meanwhile, R-Design and Polestar will apply their magic performance touches to a few of the new vehicles, going up against similar efforts from BMW, Mercedes and Audi.

All of the above are expected to come online within the next four years, but no coupes or convertibles are in the plans, citing a lack of a case for either at this time. Volvo will instead focus on boosting its volume, with a goal of 800,000 units for 2014 alone.

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Fiat Sets Date Of Shareholder Meeting For August 1 http://www.thetruthaboutcars.com/2014/07/fiat-sets-date-of-shareholder-meeting-for-august-1/ http://www.thetruthaboutcars.com/2014/07/fiat-sets-date-of-shareholder-meeting-for-august-1/#comments Fri, 04 Jul 2014 13:00:38 +0000 http://www.thetruthaboutcars.com/?p=858633 Own any shares in Fiat S.p.A.? The automaker just announced it will hold its next general assembly of all shareholders August 1, where the topic of discussion will be the approval of the merger of Fiat with Chrysler Group to become Fiat Chrysler Automobiles N.V. Reuters reports shareholders will also be asked to approve the […]

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A new Fiat Chrysler Automobiles sign is pictured after being unveiled at Chrysler Group World Headquarters in Auburn Hills, Michigan

Own any shares in Fiat S.p.A.? The automaker just announced it will hold its next general assembly of all shareholders August 1, where the topic of discussion will be the approval of the merger of Fiat with Chrysler Group to become Fiat Chrysler Automobiles N.V.

Reuters reports shareholders will also be asked to approve the merger of Fiat with its wholly owned subsidiary Netherlands Fiat Investments N.V. prior to the FCA vote. The meeting would allow CEO Sergio Marchionne to list FCA on the New York Stock Exchange by October at the earliest.

Those who approve FCA’s existence will receive one FCA common share for every Fiat share they hold, while those against will have the right of withdrawal for the next 15 days, with the redemption price set to €7.727 ($10.51 USD) per Fiat share.

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Endless GM Recall Parade Sign Of Industry-Wide Action To Come http://www.thetruthaboutcars.com/2014/05/endless-gm-recall-parade-sign-of-industry-wide-action-to-come/ http://www.thetruthaboutcars.com/2014/05/endless-gm-recall-parade-sign-of-industry-wide-action-to-come/#comments Thu, 22 May 2014 10:00:56 +0000 http://www.thetruthaboutcars.com/?p=828562 Detroit Free Press posits the endless recall parade General Motors has been leading since late February 2014 may be doing more harm than good for public perception or its bottom line. Though spokesman Greg Martin claimed the recalls were an effort to make his employer “a first-class safety organization” by focusing hard upon the consumer, […]

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GM RenCen Storm Clouds

Detroit Free Press posits the endless recall parade General Motors has been leading since late February 2014 may be doing more harm than good for public perception or its bottom line. Though spokesman Greg Martin claimed the recalls were an effort to make his employer “a first-class safety organization” by focusing hard upon the consumer, a survey by AutoTrader found 51 percent of auto consumers were less confident in the industry’s overall safety record as a result of the actions by GM, up from 44 percent who thought the same five days’ earlier. In addition, the automaker will take a $400 million charge in Q2 2014 for the recalls since April 1 as of this writing, while its current stock price of $33.07 per share is a few cents above its IPO price from November 2010.

Autoblog continues on this thread, proclaiming what GM is doing is the beginning of an industry-wide shift toward issuing full recalls for any flaw in a given product, all under heightened scrutiny from the public and government regulators. For the first months of this year alone, all automakers have recalled a total of 22.4 million vehicles, the bulk of which belong to GM. Kelly Blue Book analyst Akshay Anand says the parade is a double-edge sword, particularly for the General; while such recalls are a sign automakers are being proactive in ensuring their products are as safe as they can be, consumers may perceive the effort as a sign automakers are failing to do their job well in the first place.

Automotive News follows with Fiat Chrysler Automobiles CEO Sergio Marchionne, who stated in a panel discussion at the Brookings Institute this week what else might occur when the GM-led parade becomes a permanent fixture in the industry:

If effectively this frequency of recalls becomes a norm, if everybody starts doing this, then I think you will see this cost being shifted to the consumer. It will transfer itself over onto the selling price of the vehicle.

Marchionne adds automakers, in turn, will act more sensibly in handling potential defects in product, noting punitive actions — such as paying $35 million in fines to the National Highway Traffic Safety Administration — will have little in the way of such handling when reputation is the bigger issue for the industry as a whole.

Speaking of the main parade itself, Autoblog reports 218,000 2004 through 2008 Chevrolet Aveos have been recalled due to the daytime running light module in the instrument panel possibly overheating, melting and setting the vehicle ablaze. According to spokesman Alan Adler, the automaker is “aware of some fires” so far, and is working on a fix for the module. Adler adds that while he doesn’t know when the fix will come, GM will send a second notice to owners when the time comes to schedule repair work.

Detroit Free Press concludes by explaining why GM continues to issue recalls as it combs through its records to avoid another decade-long delay in taking such action:

  • The government has ordered the automaker to meet with the NHTSA monthly on investigations and recalls as part of the former’s $35 million settlement with the latter
  • GM CEO Mary Barra’s appointment of Jeff Boyer to global quality chief — with the mandate to report directly to her if necessary — means anything deemed dangerous or otherwise unknown, including previously unreported defects — are up for attention
  • The automaker’s investors prefer to get the bad news out of the way and accept whatever potential pain awaits in as few quarters as possible, even if no one is happy about swallowing such medicine in the first place

The Freep also provided a list of every recall from January through this week, minus the latest recall issued Wednesday; total recall to date is 18,666,842.

GM

On the sales front, Automotive News reports dealers won’t be able to sell any of the 2009 through 2014 Chevrolet Traverse, Buick Enclave and GMC Acadia crossovers thanks to a stop-sale order issued in a recall involving the front seat belt cable in the vehicles. The order comes during one of the biggest sales weekends of the year, putting a damper on potential Memorial Day promotions. Though dealers could still close on sales without actually allowing the vehicle to leave the lot, no test drives can be carried out in affected demonstrators, making such sales more difficult. GM is offering an end-of-month incentive to maintain May sales momentum, but that may not be enough to offset the extra floorplanning costs if few vehicles can be sold until the affected units are repaired.

Back in the Beltway, Barra met with U.S. Senator Claire McCaskill of Missouri and other members of Congress to discuss recent findings in the February 2014 ignition switch recall. Though spokesman Greg Martin confirmed the meetings did take place, he did not give details on all that was said between Congress and the CEO.

Meanwhile, members of the Obama administration who helped assemble the rescue packages for both Chrysler and GM said they knew nothing about the out-of-spec switch at the heart of the recall maelstrom when said packages were crafted between them and the automaker’s senior execs. One member, Harry Wilson, stated that even if the task force asked GM point-blank about the switch, he doubted they would ever get a straight answer. Lead adviser Steven Rattner added that as far as he knew, the execs before him then didn’t know about the problem; therefore, neither could his task force.

Over in Texas, Bloomberg both GM and supplier Delphi have asked the Texas Supreme Court to combine four suits linked to the switch into one state case. The claim is fighting each one separately would cost the duo time and money, while combining the four and rolling subsequent cases going forward into a single case would “eliminate duplicative discovery, void conflicting pretrial rulings, conserve judicial resources, be more convenient for the parties and witnesses and otherwise promote a more just and efficient conduct of this litigation.” The cases mention involve wrongful injury and death.

With GM’s cadre of lawyers coming under the gun now, Detroit Free Press reports the automaker’s general counsel Michael Millikin has named attorney Lucy Clark Doughtery to advise Boyer and product development chief Mark Reuss. Millikin is also working with independent lawyer Anton Valukas on the internal investigation into why GM handled the recall the way it had. The general counsel’s own future with the company has been called into question, though GM claims Millikin has no “current plans to retire” at this time.

In financial news, Automotive News says GM Financial is preparing to go under its own test of scrutiny of loans originated by its dealership network in an effort to avoid punitive action by the Consumer Financial Protection Bureau based on allegations of discrimination in lending rates among minority consumers. The lender’s chief compliance officer, Dan Bickmore, says his role is to help reorganize the company into compliance with the CFPB, going as far as to establish a new compliance department and boosting the lender’s complaint management process and fair lending areas. He also aims to help educate dealerships on appropriate lending policies to prevent discrimination of protected classes when drafting a loan or lease contract.

On the design front, global design chief Ed Welburn says that with GM’s line of vehicles sharing the same technology and functionality with each other, styling will be needed to help differentiate each unit. He goes on to say the automaker has committed a few design sins in the past, favoring functionality over style and charm, as well as decontenting interiors when a product was overbudget. Welburn concludes that the new guard leading GM “really cares about interiors now, and it shows,” such as the interiors in the 2014 Chevrolet Corvette and Cadillac ELR.

Finally, The Detroit News says the 2015 GMC Sierra All Terrain HD will go on sale this summer. The pickup will be available in 2500 and 3500 weight classes with double and crew cab options, with trim lines to include SLE, SLT and Z71. Power is expected to come from a standard 6-liter gasoline engine, with a twin-turbo Duramax diesel on the options list.

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Fiat Chrysler Automobiles’ London Headquarters To Focus On Corporate Finance http://www.thetruthaboutcars.com/2014/05/fiat-chrysler-automobiles-london-headquarters-to-focus-on-corporate-finance/ http://www.thetruthaboutcars.com/2014/05/fiat-chrysler-automobiles-london-headquarters-to-focus-on-corporate-finance/#comments Wed, 21 May 2014 11:00:08 +0000 http://www.thetruthaboutcars.com/?p=827618 Fiat Chrysler Automobiles’ new headquarters in London, England will be as small as many Silicon Valley startups, with a staff of 50 mostly focused on finance. Automotive News Europe reports FCA CEO Sergio Marchionne and Fiat Group chairman John Elkann will have a home in London, with FCA COO Richard Palmer possibly having a place […]

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Fiat 500 in London

Fiat Chrysler Automobiles’ new headquarters in London, England will be as small as many Silicon Valley startups, with a staff of 50 mostly focused on finance.

Automotive News Europe reports FCA CEO Sergio Marchionne and Fiat Group chairman John Elkann will have a home in London, with FCA COO Richard Palmer possibly having a place there as well. Though no new hiring is planned, the automaker hopes to pull more finance employees from its Asia Pacific and Latin American regions to its headquarters, where most of the work will involve treasury operations.

The move to London also means tax savings for FCA; whereas Fiat paid 31.4 percent in corporate taxes to Italy while Chrysler paid 35 percent to the United States, the Italo-American company will pay only 20 percent for its part of filling the Queen’s coffers. This strategy has come under fire from both sides of the Atlantic, with feelings of betrayal on the part of Italians due to history, and on Americans due to tax dollars used to rescue Chrysler in 2009.

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Japanese Automakers Form Alliance To Develop Next-Gen Fuel-Efficient Engines http://www.thetruthaboutcars.com/2014/05/japanese-automakers-form-alliance-to-develop-next-gen-fuel-efficient-engines/ http://www.thetruthaboutcars.com/2014/05/japanese-automakers-form-alliance-to-develop-next-gen-fuel-efficient-engines/#comments Tue, 20 May 2014 12:00:38 +0000 http://www.thetruthaboutcars.com/?p=826666 Japan’s cadre of automakers have formed an alliance to research and develop a new generation of diesel and gasoline internal combustion engines, with the goal of delivering a 30 percent improvement in fuel efficiency by 2020. Automotive News reports the Research Association of Automotive Internal Combustion Engines (AICE) will provide half of the 1 billion […]

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AICE

Japan’s cadre of automakers have formed an alliance to research and develop a new generation of diesel and gasoline internal combustion engines, with the goal of delivering a 30 percent improvement in fuel efficiency by 2020.

Automotive News reports the Research Association of Automotive Internal Combustion Engines (AICE) will provide half of the 1 billion yen ($9.9 million) budget for the research and development of the new engines, with the Japanese government contributing the rest. The group structure follows similar paths outlined by their European competitors, where automakers cooperate with academia and government to bring new and improved technologies to market while cutting costs in R&D.

AICE has outlined a 10-year plan for improving efficiency in the combustion engine, targeting a thermal efficiency rate of 50 percent for both gasoline and diesel engines. Diesel R&D will focus on EGR and particulate filtration systems, while R&D for gasoline aims for more complete combustion cycles and improved ignition with knock reduction.

Honda R&D managing officer Keiji Ohtsu will be the first president of the new R&D body.

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Analysis: Toyota Could Bring $7.2 Billion To Texas Over Next Decade http://www.thetruthaboutcars.com/2014/05/analysis-toyota-could-bring-7-2-billion-to-texas-over-next-decade/ http://www.thetruthaboutcars.com/2014/05/analysis-toyota-could-bring-7-2-billion-to-texas-over-next-decade/#comments Fri, 16 May 2014 10:00:26 +0000 http://www.thetruthaboutcars.com/?p=821306 Toyota’s big move from California to Texas may also bring a big return for Plano, Texas over the next decade, to the tune of $7.2 billion of economic activity. Bloomberg reports an analysis by Chicago-based Grant Thornton LLP claims the $7.2 billion includes $4.2 billion from payroll taxes, as well as direct and indirect payments, […]

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Toyota Texas

Toyota’s big move from California to Texas may also bring a big return for Plano, Texas over the next decade, to the tune of $7.2 billion of economic activity.

Bloomberg reports an analysis by Chicago-based Grant Thornton LLP claims the $7.2 billion includes $4.2 billion from payroll taxes, as well as direct and indirect payments, and revenues from sales and property taxes. The analysis was issued on the same day Plano approved a large incentive deal for Toyota, including $6.75 billion in grants and property tax discounts. The state government also approved an incentive package, totaling $40 million.

The report also notes the move and consolidation of Toyota’s operations in the United States to Plano from California, Kentucky and New York, announced last month, is expected to bring as many as 3,650 full-time employees with an average salary of $104,000 by 2018.

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Walmart Unveils Online One-Stop Auto Insurance Venture http://www.thetruthaboutcars.com/2014/05/walmart-unveils-online-one-stop-auto-insurance-venture/ http://www.thetruthaboutcars.com/2014/05/walmart-unveils-online-one-stop-auto-insurance-venture/#comments Thu, 01 May 2014 12:00:24 +0000 http://www.thetruthaboutcars.com/?p=813473 Walmart is the home of low prices on many, many things, from clothes and groceries, to televisions and tires. The retailer also offers a number of financial services, such as prepaid debit cards and money transfers. And of course, they’re even experimenting with heavy-duty truck design for better fuel economy. As of this week, though, […]

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Walmart Storefront at Night

Walmart is the home of low prices on many, many things, from clothes and groceries, to televisions and tires. The retailer also offers a number of financial services, such as prepaid debit cards and money transfers. And of course, they’re even experimenting with heavy-duty truck design for better fuel economy.

As of this week, though, Walmart shoppers can add one more item to their list: Auto insurance.

Detroit Free Press reports Walmart is partnering with price-comparison and shopping website AutoInsurance.com, the latter born out of talks with parent company Tranzutary Insurance Solutions to provide the former’s customer base with a one-stop solution for comparing and purchasing policies online. The service is just now exiting the pilot phase in Pennsylvania, entering additional markets in Louisiana, Mississippi, Missouri, Oklahoma, Texas, Tennessee and Walmart’s home state of Arkansas this week prior to a full nationwide rollout later this year.

Though Walmart doesn’t operate AutoInsurance.com, the retailer will heavily market its newest financial offering at the front of the store, selected aisles and online through its own website. Plans offered include those from Progressive, Esurance, Travelers and Safeco.

As for the average annual savings Walmart shoppers would gain from buying their auto policies with their new laptops and Monsters High dolls, Pennsylvania shoppers surveyed claimed to have saved $1,100 annually by going through Walmart’s latest financial venture.

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AutoNation Parts Ways With Third-Party Lead Providers, Pursues Own Online Project http://www.thetruthaboutcars.com/2014/04/autonation-part-ways-with-third-party-lead-providers-pursues-own-online-project/ http://www.thetruthaboutcars.com/2014/04/autonation-part-ways-with-third-party-lead-providers-pursues-own-online-project/#comments Mon, 21 Apr 2014 13:00:41 +0000 http://www.thetruthaboutcars.com/?p=806306 In its pursuit of establishing an online store where shoppers can do (almost) everything related to the car-buying experience, AutoNation Inc. announced last week it would no longer use third-party lead providers, focusing instead on its own online plans. Automotive News reports the move is related partly to rising costs, whose savings will be invested […]

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autonation-inc-logo

In its pursuit of establishing an online store where shoppers can do (almost) everything related to the car-buying experience, AutoNation Inc. announced last week it would no longer use third-party lead providers, focusing instead on its own online plans.

Automotive News reports the move is related partly to rising costs, whose savings will be invested toward AutoNation’s online storefront as laid out in the announcement by CEO Mike Jackson:

We’re really looking at the whole spectrum of how we interact with our customers. We’re also going to be looking to broaden the brand attributes of AutoNation and move into different business fields with branded products from AutoNation, whether that’s service contracts, warranty contracts. We’re full of ideas.

The project, launched in 2012, aims to make shopping for a new car at any of its 229 branded dealerships as seamless as possible, from making the purchase at home, to finalizing financing et al the next day. $100 million will be invested into the project over the next several years, with the bare-bones version of AutoNation’s storefront opening for business in December 2014.

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Cadillac Flagship, Redesigned LaCrosse To Be Made In Detroit By 2016 http://www.thetruthaboutcars.com/2014/04/cadillac-flagship-redesigned-lacrosse-to-be-made-in-detroit-by-2016/ http://www.thetruthaboutcars.com/2014/04/cadillac-flagship-redesigned-lacrosse-to-be-made-in-detroit-by-2016/#comments Tue, 15 Apr 2014 11:30:16 +0000 http://www.thetruthaboutcars.com/?p=798938 In light of General Motors’ recent announcement of a $384 million investment in its Detroit-Hamtramck Assembly Plant, two vehicles from Cadillac and Buick could wind up being produced alongside the next-generation Volt. Edmunds reports IHS Automotive senior analyst Stephanie Brinley expects Cadillac’s all-new flagship to be produced in late 2015, with the Buick LaCrosse — […]

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2013 Cadillac Elmiraj Concept

In light of General Motors’ recent announcement of a $384 million investment in its Detroit-Hamtramck Assembly Plant, two vehicles from Cadillac and Buick could wind up being produced alongside the next-generation Volt.

Edmunds reports IHS Automotive senior analyst Stephanie Brinley expects Cadillac’s all-new flagship to be produced in late 2015, with the Buick LaCrosse — currently assembled in Fairfax, Kan. — joining the flagship in 2016 for the latter’s next redesign.

Though GM hasn’t said much about the flagship, industry insiders claim the vehicle will be aimed at the Audi A8, BMW 7 Series, Lexus LS and Mercedes S-Class, and may be priced as much as $100,000.

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Barra Testifies Before US Senate Subcommittee http://www.thetruthaboutcars.com/2014/04/barra-testifies-before-us-senate-subcommittee/ http://www.thetruthaboutcars.com/2014/04/barra-testifies-before-us-senate-subcommittee/#comments Thu, 03 Apr 2014 11:55:13 +0000 http://www.thetruthaboutcars.com/?p=786625 On the second and final day of testimony before Congress, The Detroit Press reports the U.S. Senate Commerce, Science and Transportation subcommittee fired several volleys at General Motors CEO Mary Barra over her lack of answers or greater action during the ongoing GM ignition recall crisis. Finding no allies from either side of the aisle, […]

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U.S. senator accuses GM of 'culture of cover-up'

On the second and final day of testimony before Congress, The Detroit Press reports the U.S. Senate Commerce, Science and Transportation subcommittee fired several volleys at General Motors CEO Mary Barra over her lack of answers or greater action during the ongoing GM ignition recall crisis.

Finding no allies from either side of the aisle, Barra faced tough questions and criticisms from the members of the subcommittee, with the toughest attacks drawn from subcommittee head Senator Claire McCaskill of Missouri. The senator proclaimed former engineer Ray DeGiorgio “repeatedly lied” about knowledge of the April 2006 fix of the out-of-spec ignition switch, citing GM’s “culture of cover-up” as encouragement for egregious violations of the public trust.

Barra’s alleged lack of knowledge of the issues surrounding the switch recall came back to haunt her when Senator Barbara Boxer of California declared the CEO “didn’t know anything about anything,” and wondered why someone with the resume Barra has could not know anything during the 33 years she had been a part of General Motors.

Other highlights from the Senate hearing include:

  • Barra not committing to when GM’s own investigator, Anton Valukas, could be made available for questioning by the Senate, saying the decision was his to make
  • Barra not knowing how many lawsuits have been filed in relation to the out-of-spec switch, nor having been counseled by GM’s general counsel
  • Barra stating no one involved with the recall still under GM’s employ had been fired, would take action if internal investigation determined as such
  • Senator Dean Heller of Nevada wanting supplier Delphi to testify
  • Barra clarifying her comment to the House about sharing information from the internal investigation
  • GM agreeing to share documents provided by the National Highway Traffic Safety Administration with the subcommittee

Moving over to The White House, the Obama administration aims to do all they can to get a handle on the case before them, as Deputy Press Secretary Josh Earnest informed reporters aboard Air Force One during the President’s visit to Ypsilanti, Mich.:

The National Highway Traffic Safety Administration — or NHTSA — has opened a formal investigation to whether GM shared the information they had about this issue as quickly as they should. Secretary Foxx has also asked the inspector general of the Department of Transportation to conduct an audit to provide a single, comprehensive review of NHTSA’s work in this case.

Finally, The Detroit News posits that Barra’s legacy — and that of General Motors — would long be haunted by nine words uttered by an unknown GM engineer in 2005 over fixing the out-of-spec switch: “None of the solutions represents an acceptable business case.”

On the lawsuit front, attorney Dana Taschner — one of the lawyers involved in the 15 lawsuits filed in federal court on behalf of affected Chevrolet Cobalt owners — wants the cases consolidated and sent before U.S. District Judge James Selina in Santa Ana, Calif., according to Bloomberg. Tascher’s reasoning is that Selina, who is presiding over the cases linked to Toyota’s unintentional acceleration debacle, is the right judge for the job of taking GM to task:

The scope of the expanding recall and number of cars and consumers involved will result in a high volume of lawsuits filed in multiple jurisdictions warranting coordinated or consolidated proceeding.

Detroit Free Press reports safety advocate and chairman emeritus of consumer advocacy group Public Citizen Joan Claybrook is calling for reform from both GM and the NHTSA. Regarding the former, Claybrook believes Barra “has more power than any GM executive probably ever had,” and could lead the reform path toward a focus on safety over costs.

As for the latter, Claybrook — who led the agency between 1977 and 1981 — wants the NHTSA to have more resources available to do its duty to the public, change the complaint-filing process for ease-of-use by consumers, and be granted the authority to purse criminal charges against automakers who fail to recall dangerous products.

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Marchionne’s FCA Looks To Sell 6 Million Units http://www.thetruthaboutcars.com/2014/04/marchionnes-fca-looks-to-sell-6-million-units/ http://www.thetruthaboutcars.com/2014/04/marchionnes-fca-looks-to-sell-6-million-units/#comments Wed, 02 Apr 2014 14:00:40 +0000 http://www.thetruthaboutcars.com/?p=786433 Should Sergio Marchionne’s Fiat Chrysler Automobiles be able to deliver on his expectations, the merged automaker will be able to move 6 million units annually, enabling FCA to become a player on the global stage. The Detroit News reports Marchionne met before Fiat’s shareholders in the final meeting at the automaker’s Turin, Italy headquarters before […]

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marchionne

Should Sergio Marchionne’s Fiat Chrysler Automobiles be able to deliver on his expectations, the merged automaker will be able to move 6 million units annually, enabling FCA to become a player on the global stage.

The Detroit News reports Marchionne met before Fiat’s shareholders in the final meeting at the automaker’s Turin, Italy headquarters before FCA relocates to the Netherlands, stating what he expects out of FCA in the post-merger years to come:

By 2018, Fiat will be able to make more than 6 million cars. I don’t want to give any details of the plan, but we are going in that direction.

For 2014, Marchionne stated FCA aims to sell between 4.5 million and 4.6 million units on the strength of United States and Asia markets, collecting some $128 billion in revenues, and between $828.6 million and $1.1 billion in net profit. The goal of selling 6 million units has been an oft-mentioned one by Marchionne, who believes that the volumes necessary to achieve scale will only increase in the future.

Until then, his current goal is to have Chrysler and Fiat completely merged by the end of 2014, with a multi-year business plan to be presented in Detroit by May. Marchionne believes the new plan can be run “by purely financing on debt.”

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Tesla Stays In NY, Loses Key China Exec http://www.thetruthaboutcars.com/2014/03/tesla-stays-in-ny-loses-key-china-exec/ http://www.thetruthaboutcars.com/2014/03/tesla-stays-in-ny-loses-key-china-exec/#comments Mon, 31 Mar 2014 12:59:13 +0000 http://www.thetruthaboutcars.com/?p=785169 Automotive News reports Tesla and Greater New York Automobile Dealers Association reached a compromise agreement over the weekend that would allow the EV automaker to keep their five stores while prevent Tesla or any other auto manufacturer from establishing more direct-sale stores in the state. In the words of Governor Andrew Cuomo: Today’s agreement reaffirms […]

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Tesla Model S

Automotive News reports Tesla and Greater New York Automobile Dealers Association reached a compromise agreement over the weekend that would allow the EV automaker to keep their five stores while prevent Tesla or any other auto manufacturer from establishing more direct-sale stores in the state. In the words of Governor Andrew Cuomo:

Today’s agreement reaffirms New York’s long-standing commitment to the dealer franchise system, while making sure New York remains a leader in spurring innovative businesses and encouraging zero emissions vehicle sales.

Meanwhile, Tesla spokeswoman Liz Jarvis-Shean tells Bloomberg the Gigafactory will source supplies of graphite, cobalt et al from within North America, citing cost and environmental issues behind the decision. Currently, the majority of graphite found in the automaker’s battery packs come from synthetic sources in Europe and Japan, with future natural sources expected to come from Canada.

Over in China, where graphite mines and processing plants are being closed over air-quality issues, Tesla’s general manager Kingston Chang resigned his position for personal reasons. His departure, which the automaker declined to expand upon to Bloomberg, comes just as CEO Elon Musk prepares to expand further into the country’s auto market, who predicts sales to be on par with those in the United States as early as next year.

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Congressional Hearings Loom As Switch Swap Raises Questions At GM http://www.thetruthaboutcars.com/2014/03/congressional-hearings-loom-as-switch-swap-raises-questions-at-gm/ http://www.thetruthaboutcars.com/2014/03/congressional-hearings-loom-as-switch-swap-raises-questions-at-gm/#comments Tue, 25 Mar 2014 13:30:40 +0000 http://www.thetruthaboutcars.com/?p=780281 General Motors is facing two separate lawsuits related to failures of the ignition switch recalled last month, while also preparing to bring their case before the U.S. House Energy and Commerce Committee next month, led by a representative who honed his skills upon Firestone. Meanwhile, reports of a quiet swap between the defective ignition switch […]

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General Motors is facing two separate lawsuits related to failures of the ignition switch recalled last month, while also preparing to bring their case before the U.S. House Energy and Commerce Committee next month, led by a representative who honed his skills upon Firestone.

Meanwhile, reports of a quiet swap between the defective ignition switch and an improved switch in 2006 – a swap that may have violated internal protocols -may have serious repercussions for GM and now-bankrupt supplier Delphi.

Finally, a test drive gone wrong results in a GMC Yukon left to burn, whose prompt investigation is only the beginning of a long learning process in how GM handles safety in the future.

Reuters and Just-Auto report two lawsuits were filed against GM over the weekend in Minnesota and California. The former, filed in state court on behalf of three teenage girls severely injured or killed in a 2006 crash involving a 2005 Chevrolet Cobalt, is considered to be the first wrongful death lawsuit since the recall was issued.  Robert Hilliard of Hilliard Munoz Gonzales is seeking $50,000 for each of the families affected, and names “New GM” as defendant.

The second, filed in federal court as a national class action by Michaels Law Group, cites fraudulent behavior on GM’s part over the ignition switch and subsequent recall. Founding firm member Johnathan Michaels called the automaker’s actions “an unfortunate chapter” in United States history, and proclaimed GM “allowed products to be put in the stream of commerce, knowing that people would die.”

Reuters also reports U.S. Senator Richard Blumenthal of Connecticut, who is a member of the Senate Commerce Committee, penned a letter to Attorney General Eric Holder asking the Department of Justice to demand GM establish a fund “to fully compensate consumers who suffered injury, death or damage” as a result of the ignition switch. He also suggested said fund could be applied while the DOJ conducts their investigation into the recall, one of many being conducted by various federal parties, including the Commerce Committee and the House Energy and Commerce Committee.

Bloomberg says Representative Fred Upton of Michigan, one of 32 House Republicans to back the 2008 bailouts and former co-chair of the Congressional Automotive Congress, will be take part in hearings on April 1 when the committee meets with GM CEO Mary Barra and other executives in a hearing to discuss what happened with the recall. Fourteen years earlier, Upton took on Ford and Firestone over the Explorer’s defective tires, resulting in the Transportation Recall Enhancement, Accountability and Documentation Act of 2000 now affecting both General Motors and the National Highway Traffic Safety Administration.

Regarding the NHTSA, the Detroit Free Press reports Senator Dean Heller of Nevada sent a letter to agency acting head David Friedman asking for answers by the end of the month as to why the NHTSA’s Office of Defects Investigation “declined to forward in both 2007 and 2010 on any vehicle recall recommendation” despite receiving direct access to necessary information from GM. Heller also wants to know what if any threshold complaints need to cross before further investigation is taken.

Back home, GM’s knowledge of the defective component — and its subsequent silence — may also claim Delphi under the wave of red flags the automaker ignored at its peril. Automotive News says the litigation protection established for the supplier during its Chapter 11 bankruptcy process could fall if Delphi was found to have committed fraud by not disclosing their part in the ignition defect during proceedings.

Within the Renaissance Center, USA Today says GM learned in 2007 of a 2005 fatality when a Maryland teen, Amber Marie Rose, lost control of her Cobalt and crashed into a tree while intoxicated. The report noted the airbags had not gone off as intended, with the cause linked to the switch set to “accessory” instead of “on.”

Meanwhile, Automotive News reports the in-house-designed switch — the result of the automaker wanting to do more on its own amid rising warranty costs in the mid-1990s — didn’t meet the specs required of it until its redesign in 2006, nine years after engineers were asked to design the part. However, the improved part retained its old part number when former GM engineers claim it shouldn’t have, while GM remained quiet on the matter until 2013 when a wrongful death lawsuit from Georgia started the ball rolling on the issue.

In the wake of the ongoing maelstrom, GM appointed long-serving engineer Jeff Boyer to the newly created position of vice president of global safety. Boyer will report to Barra on all safety concerns and recall decisions. Automotive News says this is just the first in a series of moves the automaker is taking to show how it has changed since emerging from bankruptcy and government ownership over the past few years, but has a long road ahead in making substantial progress regarding its long-standing bureaucratic culture.

Finally, The Los Angeles Times reports a 2015 GMC Yukon taken for a test drive in Anaheim this weekend suffered from what Anaheim Police Department Lieutenant Tim Schmidt says was “some oil leak or some fluid leaking” during the drive, leading to a catastrophic fire once the driver pulled over upon losing control of the vehicle. Autoblog adds GM will be investigating the matter “very soon,” as per the words of spokesman Alan Adler. No one was hurt in the incident.

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BMW, Mercedes Downsize Number Of Architectures For Future Vehicles http://www.thetruthaboutcars.com/2014/03/bmw-mercedes-downsize-number-of-architectures-for-future-vehicles/ http://www.thetruthaboutcars.com/2014/03/bmw-mercedes-downsize-number-of-architectures-for-future-vehicles/#comments Mon, 17 Mar 2014 13:01:18 +0000 http://www.thetruthaboutcars.com/?p=773881 In order to accelerate development of new models while also cutting costs, BMW and Mercedes-Benz are downsizing the number of architectures to be used in future vehicles in their respective lineups. Automotive News Europe reports Mercedes will be down from nine platforms five years ago to four platforms by 2016, with the first — the […]

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In order to accelerate development of new models while also cutting costs, BMW and Mercedes-Benz are downsizing the number of architectures to be used in future vehicles in their respective lineups.

Automotive News Europe reports Mercedes will be down from nine platforms five years ago to four platforms by 2016, with the first — the MFA — already in showrooms as the CLA; the MFA-underpinned B-Class and GLA will arrive in United States showrooms later this summer. The move would allow Mercedes to move safety systems from their flagship S-Class to lower classes more quickly than in previous years.

Meanwhile, BMW will go from five to two platforms — one for RWD, one for FWD –between its namesake brand and Mini. The latter debuted with the redesigned Mini not too long ago, and will also underpin the 2-Series Active Tourer officially unveiled in Geneva last week.

As for the RWD platform, BMW R&D board member Herbert Deiss says it will arrive in 2016 under the next-generation 7 Series. Both consolidations were brought to life to allow more affordable expansion of each brand’s lineup.

BMW’s i Series will not take part in the consolidation, nor will Rolls-Royce.

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Ford Medium-Duty Truck Production Moving To Ohio In 2015 http://www.thetruthaboutcars.com/2014/03/ford-medium-duty-truck-production-moving-to-ohio-in-2015/ http://www.thetruthaboutcars.com/2014/03/ford-medium-duty-truck-production-moving-to-ohio-in-2015/#comments Mon, 10 Mar 2014 14:30:23 +0000 http://www.thetruthaboutcars.com/?p=768738 With the Econoline passing the torch to the Transit Connect at the end of this year, Ford is in the process of moving production of the F-650 and F-750 from Mexico to Ohio in time for the medium-duty trucks’ redesign for 2015. Bloomberg reports the automaker is cutting ties with Navistar International in a joint […]

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2015 Ford F-650

With the Econoline passing the torch to the Transit Connect at the end of this year, Ford is in the process of moving production of the F-650 and F-750 from Mexico to Ohio in time for the medium-duty trucks’ redesign for 2015.

Bloomberg reports the automaker is cutting ties with Navistar International in a joint venture based in Escobedo, Mexico to take full control of the two medium-duty trucks in their transfer to Avon Lake, Ohio, bringing the entire F-Series line — and the profits made up and down the chain — in-house as Ford’s president of the Americas Joe Hinrichs explains:

We’re doing this to bring the 650-750 production in-house so that we have complete design, manufacturing and engineering control over our F-series lineup. It’s so critical to be able to offer our commercial customers everything from an F-150 all the way to an F-750 and to know it’s built by Ford.

The relocation will preserve 1,600 jobs while honoring an agreement made between Ford and the United Auto Workers in 2011, with no added jobs or change in labor costs resulting from the move.

Hinrichs expects it will take less than the 13 weeks needed to transition the two F-150 plants from steel to aluminium-body production, with tooling from the Mexico plant already being put into place:

A lot of equipment has been going in on the fly. It’s not what we would classify as a new body shop, but the investment that’s being made largely is for equipment in the body shop and for tooling associated with building the 650 and 750.

The transition will occur in time for the F-650’s and F-750’s 2015 redesign, though the medium-duty trucks will remain steel-bodied.

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Toyota To Receive SkyActiv Engines For Upcoming Subcompact http://www.thetruthaboutcars.com/2014/03/toyota-to-receive-skyactiv-engines-for-upcoming-subcompact/ http://www.thetruthaboutcars.com/2014/03/toyota-to-receive-skyactiv-engines-for-upcoming-subcompact/#comments Fri, 07 Mar 2014 15:33:51 +0000 http://www.thetruthaboutcars.com/?p=767377 Toyota’s line of engine/body mashups continues, this time with their upcoming Mazda2-based subcompact powered by Mazda’s SkyActiv engine family. Automotive News reports the subcompact, set to replace the current Yaris by 2016 at the latest, will be assembled alongside the new Mazda2 at Mazda’s newly opened Salamanca, Mexico factory. Approximately 50,000 of the factory’s total […]

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Mazda3 SKYACTIV engine, photo courtesy Michael Karesh

Toyota’s line of engine/body mashups continues, this time with their upcoming Mazda2-based subcompact powered by Mazda’s SkyActiv engine family.

Automotive News reports the subcompact, set to replace the current Yaris by 2016 at the latest, will be assembled alongside the new Mazda2 at Mazda’s newly opened Salamanca, Mexico factory. Approximately 50,000 of the factory’s total annual output of 230,000 units will be allocated to Toyota for the subcompact, with the SkyActiv transplant assembled on-site.

Though few details regarding either subcompact have been released, Mazda’s partnership with Toyota will allow the former to achieve greater economies of scale for the factory by supplying engines and possibly other SkyActiv-related components to Toyota.

Production for Toyota’s subcompact is set to begin next year, while Mazda2 production may begin as soon as the second half of 2014.

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Tesla Unveils $5 Billion Gigafactory http://www.thetruthaboutcars.com/2014/02/tesla-unveils-5-billion-gigafactory/ http://www.thetruthaboutcars.com/2014/02/tesla-unveils-5-billion-gigafactory/#comments Thu, 27 Feb 2014 15:10:18 +0000 http://www.thetruthaboutcars.com/?p=755721 After months of speculation, Tesla drew back the curtain on their most ambitious project to date, the Gigafactory. Yahoo News reports the Gigafactory’s price tag would total $5 billion, $2 billion of which would directly from Tesla — including a portion from a proposed $1.6 billion convertible note offering that will also be used for […]

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Tesla Gigafactory

After months of speculation, Tesla drew back the curtain on their most ambitious project to date, the Gigafactory.

Yahoo News reports the Gigafactory’s price tag would total $5 billion, $2 billion of which would directly from Tesla — including a portion from a proposed $1.6 billion convertible note offering that will also be used for future vehicle development — with current partner Panasonic and their partners fronting the remainder of the investment. Interestingly, Morgan Stanley announced it was expecting to collect underwriting fees from the note just one day after also issuing a research memo that called for a doubling of their price target for Tesla shares.

Four sites in Arizona, Nevada, New Mexico and Texas are under final consideration for the site of the Gigafactory, and the finished project will employ 6,500 workers. The first goal for the Gigafactory is to begin construction this year in time to open its doors in 2017 at the same time the low-cost Model E is set to enter showrooms, with battery costs projected to fall 30 percent in the same timeframe. The milestone will be followed by a push to increase cell and pack outputs by 35 and 50 GWh/yr by 2020, where Tesla expects to move 500,000 units a year into showrooms around the world. Despite widespread reports to the contrary, Musk told Bloomberg that Panasonic’s participation “is not 100 percent confirmed“.

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Panasonic, Partners Plan To Invest $1 Billion In Tesla Gigafactory http://www.thetruthaboutcars.com/2014/02/panasonic-partners-plan-to-invest-1-billion-in-tesla-gigafactory/ http://www.thetruthaboutcars.com/2014/02/panasonic-partners-plan-to-invest-1-billion-in-tesla-gigafactory/#comments Wed, 26 Feb 2014 15:00:08 +0000 http://www.thetruthaboutcars.com/?p=754985 In the wake of Tesla shares hitting an all-time high of $259.20 after Morgan Stanley raised its target price to $320/share, battery maker Panasonic is gathering a few partners to go all in on a $1 billion investment in the automaker’s Gigafactory battery production plant. The Globe and Mail reports that the plant, set to […]

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Toyota Panasonic TF108

In the wake of Tesla shares hitting an all-time high of $259.20 after Morgan Stanley raised its target price to $320/share, battery maker Panasonic is gathering a few partners to go all in on a $1 billion investment in the automaker’s Gigafactory battery production plant.

The Globe and Mail reports that the plant, set to open in 2017 (just in time for production of the Tesla Model E), will help bolster Panasonic’s supply of lithium-ion batteries already found in the Model S and, soon, the Model X. The Gigafactory would also provide packs to Toyota and various automakers interested in the technology.

Though the proposed factory would lower production costs by placing the entire process under one roof, the main purpose according to Tesla CEO Elon Musk is “to support the volume of the third generation car”:

Meanwhile, investors heeded the advice of Morgan Stanley Tuesday, pushing Tesla share prices to a record peak of $259.20 before falling to $248 at close. The firm raised its target price per share from $153 to $320 based on the potential effects the Gigafactory could have on the United States auto industry in the next 14 years, an assessment Stifel analyst James Albertine believes to be a game-changer in the energy storage market:

While we remain negative on Tesla shares above $200 as an automotive OEM (original equipment manufacturer), the energy storage opportunity requires a broader perspective and could very well justify current, if not higher valuation levels.

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Renewable Energy To Power Tesla Gigafactory http://www.thetruthaboutcars.com/2014/02/renewable-energy-to-power-tesla-gigafactory/ http://www.thetruthaboutcars.com/2014/02/renewable-energy-to-power-tesla-gigafactory/#comments Mon, 24 Feb 2014 11:00:20 +0000 http://www.thetruthaboutcars.com/?p=752585 Sometime this week, Tesla CEO Elon Musk will announce everything there is to know about the EV automaker’s Gigafactory, from location and price tag, to its heavy reliance on renewable energy sources. Autoblog Green reports the Gigafactory will be “heavily powered” by solar and wind energy sources, with older battery packs storing the collected energy. […]

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Sometime this week, Tesla CEO Elon Musk will announce everything there is to know about the EV automaker’s Gigafactory, from location and price tag, to its heavy reliance on renewable energy sources.

Autoblog Green reports the Gigafactory will be “heavily powered” by solar and wind energy sources, with older battery packs storing the collected energy. Meanwhile, the factory will mass-produce finished battery packs from raw lithium sources, with the aim of generating 30 gigawatt-hours annually. By taking advantage of economies of scale, costs should be reduced by 30 to 40 percent in the same timeframe needed to bring the $35,000 Model E from the drawing board to the showroom floor.

As for where the $2 billion-plus factory will be built, one rumored location is Nevada. Aside from the obvious solar power available for Musk’s green aspirations, the state also houses the sole commercial brine pool lithium production facility in the United States at this time, though more could be brought in from Wyoming’s recently discovered underground lithium brine in the state’s Rock Springs Uplift formation if needed.

Finally, funding for the Gigafactory could come from a number of sources, including new stock and alliances with other companies interested in what the factory — and the future — has to offer.

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Toyota Australia Engine Plant Moving To Thailand After 2017 http://www.thetruthaboutcars.com/2014/02/toyota-australia-engine-plant-moving-to-thailand-after-2017/ http://www.thetruthaboutcars.com/2014/02/toyota-australia-engine-plant-moving-to-thailand-after-2017/#comments Fri, 21 Feb 2014 16:30:37 +0000 http://www.thetruthaboutcars.com/?p=751065 Sources close to Toyota say the engine plant in Altona, Australia will likely be relocated to Siam Toyota Manufacturing in Thailand once the automaker ceases Australian manufacturing operations in 2017. GoAuto reports that while the company hasn’t officially announced what will happen to the $331 million AUD engine plant thus far, executives inside Toyota Australia […]

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Toyota Altona Engine Plant

Sources close to Toyota say the engine plant in Altona, Australia will likely be relocated to Siam Toyota Manufacturing in Thailand once the automaker ceases Australian manufacturing operations in 2017.

GoAuto reports that while the company hasn’t officially announced what will happen to the $331 million AUD engine plant thus far, executives inside Toyota Australia have Thailand in mind as a potential new home for some of the tooling currently in use. The factory exports 16 percent of its 2.5-liter four-cylinder engines to Thailand and Malaysia for fitment in Camry and Camry Hybrid models.

Another reason for the move to Thailand? While Toyota Australia builds 100,000 Camry, Camry Hybrid and Aurion models annualy — 70 percent for export markets, such as the Middle East — Toyota Thailand builds 880,000 units annually, exporting a wide range of vehicles to Australia and Association of Southeast Asian Nations — or ASEAN — member states. Furthermore, a free trade agreement between the two countries means vehicles, such as the HiLux and the Corolla, from Thailand enter Australian ports duty-free.

The plant, partially funded by a $63 million AUD contribution from Australia’s Green Car Innovation Fund and opened at this time last year, will close halfway through its expected lifespan of 10 years in 2017, shedding 2,500 jobs with thousands more down the local supply chain in the process.

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One-Time Tax Gain Nets Chrysler $1.6 Billion In Q4 2013 http://www.thetruthaboutcars.com/2014/01/one-time-tax-gain-nets-chrysler-1-6-billion-in-q4-2013/ http://www.thetruthaboutcars.com/2014/01/one-time-tax-gain-nets-chrysler-1-6-billion-in-q4-2013/#comments Thu, 30 Jan 2014 11:00:04 +0000 http://www.thetruthaboutcars.com/?p=727898 The American half of the newly dubbed Fiat Chrysler Automobiles reported a net income of $1.6 billion in Q4 2013, the majority of which came from a one-time tax gain of $962 million. Automotive News reports that revenue in the fourth quarter for Chrysler advanced 24 percent to $21.4 billion, while total revenue for the […]

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FCA - Fiat Chrysler Automobiles

The American half of the newly dubbed Fiat Chrysler Automobiles reported a net income of $1.6 billion in Q4 2013, the majority of which came from a one-time tax gain of $962 million.

Automotive News reports that revenue in the fourth quarter for Chrysler advanced 24 percent to $21.4 billion, while total revenue for the outgoing year totaled $72.1 billion, up 10 percent from 2012’s $65.8 billion. Meanwhile, the total adjusted net income in 2013 for the brand came out to $1.8 billion, $2.8 billion unadjusted.

Within the next four to six weeks, Chrysler’s 37,200 unionized hourly employees will receive profit-sharing checks to the tune of $2,500, with an extra $1,000 split into two awards for quality and performance to be distributed in June and December, respectively. Some individual plants will also add to the pot based on their own quality and efficiency goals.

Regarding market share, Chrysler’s home market gained two-tenths of a percentage point to 11.6 percent in 2013 on the backs of 1.8 million units sold in the United States, an increase of 9 percent driven by the brand’s redesigned truck and SUV lines. Globally, 2.6 million vehicles in 2013 were delivered, including those made for parent company Fiat.

As far as cash on-hand and debt are concerned, Chrysler reported a nest egg of $13.3 billion with $12.3 billion in gross industrial debt; in 2012, the brand held $11.6 billion in cash and $12.6 billion in debt. The bottom line marks the first time Chrysler held more cash than debt since the Italo-American marriage was consummated before the U.S. federal government back in 2009.

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Analyst to Apple CEO, Chairman: Buy Tesla http://www.thetruthaboutcars.com/2013/10/analyst-to-apple-ceo-chairman-buy-tesla/ http://www.thetruthaboutcars.com/2013/10/analyst-to-apple-ceo-chairman-buy-tesla/#comments Tue, 29 Oct 2013 15:16:54 +0000 http://www.thetruthaboutcars.com/?p=636921 It’s one thing for Tesla Motors to be the Apple of motoring. It’s another for Apple to be the Apple of motoring. The solution, according to one analyst: Apple should buy Tesla to remain profitable long after the gold rush of smartphones and tablets has disappeared from the rear view mirror. CNN Money reports an […]

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Tesla-Model-S. Photo courtesy AutoWeek.com

It’s one thing for Tesla Motors to be the Apple of motoring. It’s another for Apple to be the Apple of motoring. The solution, according to one analyst: Apple should buy Tesla to remain profitable long after the gold rush of smartphones and tablets has disappeared from the rear view mirror.

CNN Money reports an analyst for the German investment bank Berenberg, one Adnaan Ahmad, has penned an open letter to both Apple CEO Tim Cook and chairman Arthur Levinson, strongly suggesting they pay a visit to Tesla CEO Elon Musk’s high-tech lab — no doubt interrupting his Lotus submarine studynot with a demand for Doug Field’s return to One Infinite Loop, but with a Halliburton briefcase full of cash. At least five of them.

Why? According to Ahmad, purchasing the EV automaker down the road would allow Apple to obtain the type of growing revenues that will keep the computer maker in the green for a long time to come, something that no iPhone or iPad can guarantee once the age of hipster gadgetry draws to a close. Ahmad also believes that Apple’s habit of disrupting developing markets, such as telephony and tablet computing, is just what the doctor ordered for the auto industry in the United States, leading to a much more rapid transition to hybrid and electric vehicles of all shapes and colors.

As for Musk’s role, Ahmad believes Cook and Levinson “could strike up a partnership [with Musk] and obtain a new iconic partner to lead Apple’s innovation drive,” invoking the spirit of late Apple CEO and co-founder Steve Jobs while imploring the current guard to go outside of the box once again.

And if Cook and Levinson don’t heed his words? Then, per Ahmad, “the key debate will always be about [Apple’s] ability to sustain these abnormal margins in [their] iPhone business.”

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Mazda/Alfa Romeo Roadster Alliance: The Bright Side Of Consolidation http://www.thetruthaboutcars.com/2012/05/mazdaalfa-romeo-roadster-alliance-the-bright-side-of-consolidation/ http://www.thetruthaboutcars.com/2012/05/mazdaalfa-romeo-roadster-alliance-the-bright-side-of-consolidation/#comments Wed, 23 May 2012 13:54:24 +0000 http://www.thetruthaboutcars.com/?p=445703 Back when I was searching for my first car, I briefly found an Alfa Romeo Spider that looked like it would be in passable condition. Before I could even call the number from the classified ad, my father chimed in with his usual wisdom. “Oh, you don’t want to start with those. They were crap! […]

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Back when I was searching for my first car, I briefly found an Alfa Romeo Spider that looked like it would be in passable condition. Before I could even call the number from the classified ad, my father chimed in with his usual wisdom. “Oh, you don’t want to start with those. They were crap! Just get a Miata and finish!”.

Now, after 25 years of utter dominance, the Miata has finally consumed the last icon of European two-seaters, the Alfa Romeo Spider. Mazda and Fiat signed a memorandum of understanding to jointly develop new, lightweight roadsters specific to each brand. Both would be built at Mazda’s Hiroshima plant. While the new MX-5 is just around the corner, the Alfa would start production in 2015.

Alfa Romeo cars, particularly vintage ones, have an enormous following in Japan, and the tie-up with a “premium” brand will reflect well on Mazda, which is saddled with financial troubles and a gloomy future, despite a new wave of promising product. Unfortunately for Miata owners, it will be hard to harp on Alfas for oil leaks, electrical issues and other maladies once Mazda starts building the Spider to the Miata’s superb level of reliability.

The big question here is the implications for Mazda and a potential Fiat alliance. Mazda has been adamant about forming partnerships in order to ensure its survival, and Sergio Marchionne told Automobile this month that a broader partnership with Mazda would be attractive. When you think about it, a Mazda/Alfa partnership isn’t too much of a stretch…

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