UBS has cut Fiat’s rating from “buy” to “neutral”. UBS cites its cautious views on car demand in Europe and Brazil as well as heavy trucks and machinery, the areas in which Fiat are strongest. UBS notes that Sergio Marchionne’s grand scenario of spinning off Fiat’s auto division is still the company’s goal, and PSA Peugeot-Citroen as a “likely candidate”. In the near term, UBS thinks that Fiat’s market share price of €10 per share is fair, as a consolidated manufacturer. Another reason why UBS cut Fiat: Chrysler. The article finishes with a stark warning that the “value of Chrysler to Fiat has been cut to 1 euro from 2 euros.” In the interest of fairness, we shouldn’t listen too much to the stock market as these are the same people who proclaimed that the banking sector was in rude health, right up until they asked for a bailout, catching the market “by surprise”. Especially considering Sergio Marchionne is the non-executive vice chairman of UBS’s board of directors. These caveats aside though, it’s important to note that Chrysler has realistically gotten Fiat no closer to the magical 5m annual sales number it needs to spin off its auto business, nor has it added real value. And Marchionne is apparently eying up PSA as the next target in his mad march to world domination. What a gas.

For manufacturers of engine timing chains, main bearings or any of the hundreds of unique components for engines and transmissions, EVs like the Nissan Leaf pose an enormous threat. Decades of investment in the manufacturing technologies and IP are potentially rendered irrelevant if the switch to battery-powered EVs progresses at the rate that its optimists proclaim. Bloomberg tells the tales of woe from anxious Japanese suppliers: “It’s a crisis-like situation,” said Toru Fujiwara, head of Tsubakimoto’s auto-parts division. “With electric cars, there’s no way we can apply our current technology.” Especially when their current technology lacks AC or DC. (Read More…)

“Without any doubt we knew fundamentally that [a merger with GM] would work, but only if it was a collaborative effort. Frankly, there was a possibility to create something that would be extremely competitive… unfortunately, it did not happen.”

Nissan/Renault honcho Carlos Ghosn reflects on the GM merger that might have been. When asked if he was happy that the merger hadn’t gone through, Ghosn replied “when you see the disaster and the waste of energy and skills and talent, nobody can be happy.” But was he talking about GM or the failure to merge with them? And since Ghosn has us in a reflective mood, isn’t it fun to imagine how a GM-Renault/Nissan merger might have played out?

One of the most overlooked arguments during last year’s bailout debates was the fact that America’s automotive industry was not under threat. Sure, a few companies based in Detroit were panhandling at death’s door, but so-called “import brands” have been closing the gap in terms of Americans employed for years. And America’s transplant auto industry is continuing to grow. Even as the Detroit firms have slimmed down their North American manufacturing footprints, foreign firms are moving ahead with American and NAFTA-area plants despite the economic downturn. Not only do these moves signify possible new jobs, they also represent a long-term bet on the fundamental strength of the US economy.
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Volkswagen wants to unseat Toyota as number one by 2018. When they announced that strategy, it was widely discounted as Wolfsburg hubris, and as a goal so far out that nobody will recall nine years down the road that the goal has ever been set. Or as the saying goes in Wolfsburg: “In 2018, I’ll be retired.”

A few days ago, The Guardian reported that in the first 9 months of 2009, Volkswagen/Porsche made 4.4 million cars whereas Toyota made 4 million. Which ignited speculations that VeeDub may have reached its elusive goal 9 years early. Then the usual count of apples and oranges ensued, and after the joint ventures with minority stakes were included, Toyota nosed ahead.

Everybody calm down. Volkswagen is years away from overtaking Toyota, reports Das Autohaus. Surprise, surprise, arch rival GM is nipping at Toyota’s heels.
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We weren’t the only outlet to note Volkswagen’s apparent 2010 production volume win over Toyota a few days ago. Not so fast, Toyota tells Automotive News [sub]. Volkswagen’s total included production by joint ventures in which it does not hold a majority stake, Toyota’s didn’t. On an apples-to-apples basis (with minority stake affiliates included) Toyota built 4.9m vehicles in the first three quarters of 2009, to Volkswagen’s 4.4m. And because Toyota cut so much production early this year, while VW rode the European (particularly the German) cash-for-clunker wave, Toyota will continue to gain ground over the rest of the year. And the gap could widen in 2010: VW should see a certain amount of downturn in its core German market now that the abwrackprämie has expired, while improvements in the US and Asian markets should help Toyota. Not that Toyota cares about being number one. “Toyota’s goal is to focus on the customer, so we’re not focused on being No. 1,” ooze the spokesfolks. Well thanks for correcting us anyway.

Senator Corker, rest easy: the imports have your back. Tennessee-based Saturn may be shutting down, but Nissan is bringing the manufacture of their electric car, the Leaf, to Smyrna, Tennessee. Nissan made the announcement today as Rutherford County commission member voted to approve the funds required for the project. Under the scheme, Nissan will get $2.5 billion for the project plus a tax holiday of 20 to 40 years. In return, Smyrna will receive, up to, 1300 full time production jobs. That works out to be about $1.92 million per job. Not to mention a drop in tax revenue for the state. Let’s hope this Leaf is attached to an evergreen project and not a deciduous one.

GM surprised more than a few observers when it announced it would build a police-only Caprice model, based on the global RWD Chevy Lumina/ Holden Statesman. “Why build a fleet-only model and miss out on some private volume?” we asked at the time. Well, it looks like Ford’s about to do the same thing. A presser announces the development of a “purpose-built Police Interceptor specially designed and engineered to replace the Ford Crown Victoria law enforcement vehicle lineup in 2011.” Given that time table, “all new” is at least partial exaggeration (as it so often is). And it’s possible that this was motivated in part by the cool reaction to news of a possible Taurus-based Interceptor. GM went to Australia for their police-duty RWD platform, might Ford do the same with a Falcon-based interceptor? Or is this the prelude to Panther 2.0? Or, as common sense seems to dictate, is the Interceptor “all new” simply because there’s just never been an Interceptor based on this Taurus before? If Ford is really engineering a dedicated fleet vehicle for US production with no civilian counterpart, they’re as crazy as GM is. D3 it is.

Although Toyota was a 50% stakeholder in the NUMMI facility in Freemont, California, it may end up carrying 100% of the closure costs. The LA Times reports that Liquidation Motors, the company which took over GM’s assets won’t fund any of the severance pay or other expenses to the closure of NUMMI. “Motors Liquidation is not contributing at all” (to the closure costs), said Tim Yost, a spokesman for Detroit-based Motors Liquidation Corp., “We don’t believe there will be a requirement for us to do so.” Paul Nolasco,  a Toyota spokesperson in Tokyo said that “Although we cannot provide any figures at this time, it is something for which we plan to make allowance in our earnings report.” Toyota was planning for a smaller-than-expected loss for this financial year, and the addition of these extra costs (should they happen) will affect the company and its stock price. On the other hand, it also puts Toyota in the exact same boat as the American taxpayers.

The Guardian reports that in the first 9 months of 2009, Volkswagen/Porsche made 4.4 million cars whereas Toyota made 4 million. Naturally, the majority of VW’s growth has come from the area which is growing even faster than VW, China. But the lads from the Middle Kingdom weren’t the only modes of growth for Volkswagen. The Wolfsburg warriors were also beneficiaries of European stimulus packages (A.K.A: Cash for Clunkers) where Volkswagen have large market share (Germany, UK, etc). Charity really does begin at home!
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