The Truth About Cars » Cammy Corrigan The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Thu, 24 Jul 2014 14:26:12 +0000 en-US hourly 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 (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 » Cammy Corrigan Korea Week: Hyundai Writes Off 2011 In Europe. Or Not Tue, 16 Nov 2010 18:38:18 +0000

The Economic Times of India reports that Hyundai is worried about Europe. Hyundai Europe’s Vice President, Allan Rushforth, felt positive about 2010. “This year we’ll probably achieve 2.7 percent market share in a market of around 13.49 million,” he said. But with regards to 2011, he poured cold water on that year. “Next year will be really interesting. We have yet to see scrappage washout – the year-on-year effects of scrappage from the reported registration data…..I think the first half-year will be really, really tough.”

Reuters has a different story. They cite a European vice-president Allan Rushforth, who says that Hyundai will nearly double its share of the European car market to five percent in three years by leveraging the untapped potential of its brand. That Rushford said that Hyundai volume in Europe has reached “critical mass” thanks to its success selling into the aforementioned car-scrapping schemes, allowing it to “enter a new stage of supercharged growth.”

Who’s in their crosshairs? GM. “The difficulties that Opel GM.UL have experienced over the past one and a half years have given us an opportunity. They’ve lost market share and we’ve stepped into that vacuum, along with others,” this Rushford said.

And then there’s Toyota.”There’s no doubt we are increasingly on the Toyota  owners’ shopping list when it is time to replace their car.”

Sure, the European market size is expected by Rushford (and just about everybody else) to be flat in 2011 at around 13.5 million vehicles, with a particularly tough first half, and will start to grow again only in 2012. But Hyundai wants a bigger chunk of it.

Maybe there are two Rushfords. Rushford and his evil twin who talks to the Indians?

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(Plausible) Wild Ass Rumor Of The Day: Ford Trucks Going On A Diet? Mon, 15 Nov 2010 12:19:57 +0000

By 2016, federal laws will mandate that the fleet fuel economy of light trucks and SUV’s will be 30 mpg. Which means manufacturers will need to get their thinking caps on if they are to meet this standard. If they don’t, they’ll have to re-think their position in a very profitable area of the market. Ford, which is synonymous with trucks, is planning a diet. reports that Ford is toying with weight saving materials to meet these regulations for its F-150 range. Their sources say that Ford is looking at re-engineering a new platform which uses a magnesium-aluminum alloy. And gasp, to the abject horror of the “true truck” crowd, Ford could retire some of its body-on-steel ladder frame. To ensure stiffness, Ford is expected to have some elements of unibody construction, but will keep the cargo box and cab separate. Aluminum will be used in the body panels, but the interior of the cargo box will still be steel.

In combination with the all-new engines which Ford developed for the current F-150′s, the slim-fest should do something to the fuel economy. At the cost of another economy: Those space-age alloys sound awfully expensive.

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Renault-Nissan-Bajaj: A Disjointed Venture? Mon, 15 Nov 2010 11:59:57 +0000

When you enter into a joint venture with someone, it’s kind of important that you’re both on the same page. For one party to say one thing and the other party to say another could look a touch disorganized.  Take Renault-Nissan-Bajaj. Renault-Nissan is adamant that their joint venture with the Indian maker would culminate in an ultra low cost car that would compete with the Tata Nano (which is on fire at the moment). Bajaj, on the other hand, is getting cold feet.

The Hindustan Times reports that Bajaj is seeing less and less merit in this ultra low-cost car project. “A car at a cost of less than Maruti 800 is not going to work,” said Rahul Bajaj, Chairman at Bajaj Auto Ltd. The Maruti 800 is a rebadged Suzuki Alto and one of the largest selling cars in the country.

Bajai has another market in mind: “This year, we are going to sell four million 2 & 3 wheelers together. So why should we focus only to sell 20,000 units of a car? It doesn’t make sense. Unless we can sell about 200,000 units per year, it will not be feasible.” You have to admit, he presents a good point.

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Daimler Gets Russian Headaches. Without The Fun Of Vodka… Sun, 14 Nov 2010 14:07:06 +0000

A few days ago the BBC reported that, officially, Russia was losing 1 trillion rubles (that’s about $32.5b to you) due to corruption. Also coming 154th on the corruption perceptions index does not help matters, either. “Gigantic sums of money are being pocketed by officials and dishonest businessmen,” said Russian President Dmitry Medvedev, “Deal with them and put them in prison – there is no other way out.” So it sounds like President Medvedev is serious about dealing with corruption. He starts with a foreign company with deep pockets: Daimler. Again?

A few months ago, our resident German wrote about how Russia was sniffing around Daimler after the US Government shook down Daimler for $185m. Well, that sniffing has turned into a something more substantial. The Financial Times reports that Russian prosecutors have launched a fully.fledged criminal investigation into alleged bribery of officials by Daimler. Daimler said it would co-operate fully with the authorities.

What will make this investigation even tougher for Daimler is the fact that Daimler’s Russian unit already pleaded guilty to two counts of violating US anti-bribery laws. So now the prosecutors know that Daimler’s Russian division isn’t adverse to a spot of palm-greasing. While this investigation was greeted with cheers from anti-corruption campaigners, some remained a little more cynical. “We hope this will be a real investigation,” said Yuli Nisevich (via The Washington Post), chief researcher at the Moscow office of Transparency International, “and not an imitation of an investigation”.

How much do you think a Russian judge would cost?

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Weekend Head Scratcher: Will 2011 Be “Year Of The Chrysler”? Sun, 14 Nov 2010 13:24:03 +0000

I’ve made no secret that if I wanted one of Detroit big 3 to succeed it was Chrysler. I’m not really a Ford fan and any affection I had for GM got killed off with Bob Lutz’s insane ramblings. Chrysler was always considered the most broken. Heavily dependent on fleet sales, woeful reliability and bleeding money. Then Chapter 11 came and I thought it was game over for Chrysler. Until recently.

Chrysler’s sales are going through the roof, they only made a loss of $84m in the third quarter and they’ve raised their profit forecast to $700m. Even a Morgan Stanley analyst said “Chrysler may prove to be one of 2011′s most surprising success stories,” So, this week’s “Weekend Head Scratcher” is this: In 2011, will Chrysler blow us all away? Or will it be another damp squib? What say you?

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Tata + JLR = More Profits For Ford? Fri, 12 Nov 2010 11:46:46 +0000

Recently, I wrote about how Tata is reaping huge profits thanks to the acquisition of the “toxic” JLR brands. It was a huge gamble to buy them, but it paid off. Literally. Well, it appears that Tata’s growing profits are going to benefit not only Tata, but ironically, Ford, as well.

Rediff reports Tata is asking Ford to build more engines, because JLR is flying high. Tata is building plants in China and India and those plants will need supplies of engines to keep product flowing.

C. Ramakrishnan, CFO for Tata Motors, said: “Currently, Ford is delivering more than what it had contracted for, but our need is even higher than that. We believe Ford has ramp-up plans to tackle the additional volumes.”

Currently, Tata has contracts with Ford to supply Tata with engines, but as Mr Ramakrishnan also said, that doesn’t stop them from looking elsewhere. “Our agreement with Ford doesn’t prevent us from doing that. We can look at the Tata Motors range, too” he said. Erm, calm down! It probably might be better to let JLR develop a range of their own! I can’t see a Jaguar XJ being powered by the powertrain of a Tata Nano. But, best of all, this could spell good news for the UK.

Ford’s Dagenham plant is a global hub of engine manufacture for Ford. Any increase in volume, will almost certainly result in bigger volumes (and, therefore, more exports) for the Essex based plant. Go globalization!

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UK To Nissan: No Hand-Outs For You! Fri, 12 Nov 2010 08:05:16 +0000

As mentioned in an earlier article, I’m getting old. Far too old to understand the younger generation. But with experience comes cynicism (maybe that should be a TTAC slogan?). The more things change, the more things stay the same. In the recent cutbacks, which the new UK government introduced, a fund called the “Grant for Business Investment Scheme” (GBI) is to be phased out by 2012. The fund was used by Nissan for their plant up in Sunderland, Tyne and Wear. Production of the Leaf came to the UK on the back of a £20.7m grant from the GBI fund. Well, Nissan didn’t take too kindly to the news of the dry money well, says the Daily Mail.

“The UK has a clear choice of whether it wants to fight for new business, new jobs and rebalance the economy, or allow the opportunity of this business to go elsewhere” said Nissan in a statement issued to Parliament.

The UK government has its own take on the abolition of the GBI fund: It’s for the common good. It said that the aim of ending the grant scheme was to move UK companies away from their “dependence on public sector money and toward private sector financing”. In other words, go into rehab, and find your own money.

It’s funny how companies bemoan government interference, but squeal like a pig when government interferences, like grant funds, get taken away. The more things change…

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The Kids Are All…Boring? Thu, 11 Nov 2010 11:11:34 +0000

When I was younger, I never thought I’d ever say “I don’t understand young people these days”. But sure enough, the other day I said the exact phrase when a friend’s daughter was explaining why X-Factor (American Idol) is the greatest show on TV. Maybe I won’t understand music matters (I think Golden Earring and Mike and the Mechanics is trendy) but at least I’ll know what young people find fashionable in the car world. Erm…not quite…

USA Today reports that Auto Pacific has conducted a survey to find out what car brands Generation Y likes. Generation Y is defined as those born around 1983. So, I bet you’re expecting a brand like Subaru to be number one, right? Nope. They came tenth. So if Subaru is number 10, what car brand do youngish people like the most?

Toyota. That’s right. Young people look for reliability and vanilla designs in the cars they buy. But I bet you think that was a fluke? Well, guess who came in at number 2? Honda. I give up trying to understand the youth of today. Honorable mentions were given Hyundai and Kia who jumped to places 6 and 8, respectively. They helped knock brands like Mazda and Jeep out of the top ten. Two brands you would have expected to be high on this list. “The fact that Generation Y has a bigger footprint in brands like Hyundai and Kia than in past years means these brands are definitely doing something right to gain Gen Y’s attention,” said George Peterson, president of AutoPacific. The top ten of Gen Y brands go like this:

1. Toyota.

2. Honda.

3. Ford.

4. Chevrolet.

5. Nissan.

6. Hyundai.

7. Volkswagen.

8. Kia.

9. Dodge.

10. Subaru.

Did you notice something? Where is Scion, Toyota’s supposed “Youth” brand, on that list…?

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Fire In The Nano! Thu, 11 Nov 2010 10:53:17 +0000

The Tata Nano was seen as the car which will set the Indian car market on fire. Unfortunately, it seems it’ll also roast its owners.

After several reports of pyromaniac Nanos, the BBC reports that Tata offers free safety upgrades for Nano customers.

But this isn’t a recall, insists the company. They say they are merely providing customer with additional safety features. (What, a fire extinguisher? A 112 decal?)

Not only is this a PR disaster, but also a financial one. The profit margin on a Nano is slim at best. So to conduct a recall free safety upgrades will be costly and probably hack away at the already anorexic profit margin.

Tata said that teams of internal and international experts concluded that the fires were “specific to the cars which had such incidents” rather than a general fault. Now that’s reassuring.

While doing their research, Tata also found serious faults. With their customers. They said that instances of “additional foreign electrical equipment having been installed or foreign material left on the exhaust system” had been discovered. “Foreign” meaning non-Nano, not Pakistani, we hope.

Tata also said that it was up to the customer whether to take the upgrades or not.

I’d be extremely interested to meet the person who bought a Nano, read this story and though “Nah! I’ll take the risk…” If they do, that’s natural selection for you.

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The Renault Kang Doh! Thu, 11 Nov 2010 10:23:53 +0000

Full Disclosure: I hate “The Simpsons” and I hate Renault cars. So this article is going to have me seething.

Marketing Week reports that Renault is making a special edition of their family van, the Kangoo. The Simpsons’ Renault Kangoo. Each vehicle will be fitted with a Tom-Tom sat-nav system which will be installed with that “wonderful, funny, lovable character” Homer Simpson. Carl Lumbard, senior vice president and managing director at Twentieth Century Fox Consumer Products said “Renault has really taken brand partnership to another level. The transition from a hugely successful promotion to an actual product highlight the strength of the collaboration and a pioneering new product for both Renault and The Simpsons.”

For unfathomable reasons, the car will only be available in Belgium. What did they do to deserve that kind of punishment? Actually, Renault and The Simpsons are a good pairing. Both are a joke. I’m off to watch “South Park” now…

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Not So Wild Ass Rumor Of The Day: A Maserati SUV Built On A Grand Cherokee? Wed, 10 Nov 2010 14:38:39 +0000

When Fiat started to get a grip on Chrysler, there was very little chance of success. But to be fair, they are making a go of it. Sergio Marchionne is doing his best to integrate Fiat and Chrysler. Is he really?

Bloomberg reports that Sergio wants to use the Jeep Grand Cherokee’s platform to engineer SUV’s for Alfa Romeo and Maserati. “One of the things that we are now looking at in some detail is the possibility of utilizing this architecture and extending its application for additional products both within Chrysler and outside Chrysler,” said Sergio Marchionne. “Expect Chrysler products to be made by Fiat and Fiat products to be made by Chrysler.”

The Detroit News confirms the story and says that Marchionne’s timetable to add a Detroit-built Alfa and, possibly a Maserati using the Grand Cherokee’s platform is be between 12 to 18 months. Possible powertrains suggested by Marchionne were a turbo-charged, Pentastar V-6 engine. Marchionne even suggested using a Ferrari engine. How did people react? “That’s a gutsy move,” said Joe Phillippi of Autotrends.

Mind you, Mr Marchionne did state that Fiat and Ferrari wouldn’t use the Jeep platform. That’s a relief. A Ferrari SUV? That’d be ridiculous…  On second thought, there are Lamborghini tractors, so why not?

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Tata Will Get By With A Little Help From Their Friends Wed, 10 Nov 2010 12:51:09 +0000

When Tata bought Jaguar Land Rover (JLR) from Ford in 2008, the general consensus was that Ford was off-loading a massive problem, and that Tata should have their collective heads examined. JLR had been nothing but a cash drain on Ford. Sucking up resources which other divisions (cough-Lincoln-cough) sorely needed. The Jaguar brand was damaged due to the X-Type “fiasco” (note the inverted commas, because I still love my X-Type!) and Land Rover wasn’t really held in much higher regard. Even I, a big Jag-fan, had to concede that I was seeing the final days of JLR. How wrong was I?

The Economic Times of India reports that Tata Motors’ profits have soared to 22.2b rupees (that’s just under $500m to you) for the quarter leading up to the end of September. This represents close to a 100-fold increase from last year. How can this be? Well it was down to those “damaged” brands I was talking about earlier. JLR. Demand for JLR vehicles rose by 43 percent on the back of big demand from the United States and China. Especially for the XJ. JLR wasn’t the only riser.

Tata branded vehicles did extremely well. They rose 21 percent in October of this year. Because of these rising sales, Tata is hiring more staff, reversed a decision to close the manufacturing plants for JLR in the UK and is expanding in India. While this is good news for JLR, one thing keeps nagging me at the back of my head. Is JLR’s success down to the products which Ford helped them develop and Tata is reaping? Or is it down to Tata’s management? While I want to believe the latter, I strongly suspect the former.

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BMW Dealers Face The Death Star Tue, 09 Nov 2010 09:08:20 +0000

Dealerships are a pain in the neck. The salesman tries to convince you that they’re your friend (when you know damn well they want as much money as they can squeeze out of you), getting warranty work out of them is sometimes a nightmare and, if you’re buying used, you don’t know what the car has been through. You can write a letter of complaint, but will that really help*? You may get a discounted service as compensation, but will anything REALLY change? Well, BMW wants to shake the dealership experience up a bit. In the customers’ favor. reports that BMW and Mini dealerships across the UK have launched a new customer service system that allows every customer to rate their dealership experience on a five star scale. The system also includes a facility for the customer to leave feedback comments which are posted on the dealer’s website. OMG, eBay scores for BMW dealers?  “We are committed to providing the very best service for our customer and believe that this level of openness and transparency is not only desirable but essential,” said Tim Abbott, Managing Director of BMW UK.

Customers will be given a unique code, specific to a particular sales or service experience and will be invited to assign a star rating (out of five) and make comments. The comments and ratings will stay on the dealer’s website for 90 days and will be available to anybody who visits the site. For a dealer to score five stars, they have to achieve a stellar rating between 95 and 100 per cent satisfaction. One star means satisfaction is below 20 percent. That dealer shouldn’t get a star, he should be handed a gun with one round in the chamber.

The system has been trialed by BMW and Mini since January 2010. “This is a brave decision,” said Tim Abbott, “There is no hiding place in a retail environment displaying this kind of transparency. But I am confident that our dealers truly understand the importance of satisfied customer. For those who are not yet rated with four to five stars it will drive their future performance and deliver a more focused customer culture.” Translation: sloppy dealers will get an arse-kicking.

Incidentally, a system already exists for the United States. In researching this article I found a website which does rate dealers across the country. The problem with those is that ANYBODY can post feedback on there. Even if you’ve never been to the dealership. A bit like the NHTSA database. Or .

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And The Stingiest Car Is … Tue, 09 Nov 2010 08:39:12 +0000

The Royal Automobile Club (RAC) held its first Future Car Challenge. This was a race from Brighton to London (about 57 miles). The Auto Channel says it was to see who could consume the least during the trip. To keep things fair, the trip consisted of different driving conditions from country roads to traffic jams. Well, the race was done and the results are in. I can now reveal that the winner of the first RAC Future Car Challenge is, (soft) drum roll, please…

The Volkswagen Golf Blue-E-Motion. The plucky little electric car, with 115 bhp, a top speed of 86mph and 0-62mph time of 11.8 seconds won the race. “It’s a testimony to the abilities of the Golf Blue-E-Motion that it won despite the fact I’d never competed in any sort of eco-driving challenge before,” said Jim Holder, driver of the winning car.

Autocar reports that there were other categories for getting greenie points. The BMW 320d EfficientDynamics diesel won “the most efficient combustion engine” award. The Lotus Elise electric won in the “most economical sports electric vehicle” category, and the Mercedes-Benz B-Class F-cell hydrogen car can now officially claim the title ” most efficient fuel cell”.

Professor Stephen Glaister (via the BBC), director of the RAC Foundation, couldn’t help it, and rained a bit on his own parade:

“There is a large price difference between the most fuel-efficient models currently available and the next generation of vehicle already arriving in showrooms…The cars of tomorrow might have low running costs, but that will be irrelevant if people haven’t got the cash to buy them in the first place.”

Very true, Professor.

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Ford To Export To 48 Countries Around The World. From India Tue, 09 Nov 2010 08:12:30 +0000

The idea behind the big car bailout supposedly was to keep millions of jobs in, well, North America. Ford didn’t partake, and hence should be free of moral obligations. (Not that other companies on the government drip seem to be queasy about exporting jobs instead of cars.) Empowered by a clean conscience, Ford moves production to where it makes the most money. To India.

India is destined to be the global small car hub. Nissan now makes pretty much of its Micras there after production was transferred from Nissan UK (the Juke replaced it). Ford had a similar vision when it set up its plant in India to make the soon-to-be-insanely-popular Figo. Now the world is going to taste the Made-in-India Ford Figo.

Ford had already started exports of the Figo to South Africa, but now, as The Deccan Herald reports, Ford is planning to export the Indian built Figo to 48 countries around the world.

“Soon we will be shipping out Figo to new markets like North Africa, South America, UAE, Mexico. We started Figo exports to South Africa and recently added Nepal to our export destination,” said Michael Boneham, President and Managing Director of Ford India. South Africa is lapping up the Figo as Mr Boneham said (via “Figo has been among the top five selling cars in South Africa now and we got an overwhelming response,” It’s also getting a good response in India, too, as Mr Boneham carried on, “Figo in the second fastest car model in India to cross the 50,000 sale mark,” First the Fiesta and now the Figo. I think this small car shtick is no fluke for Ford…

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UK Car Sales In October 2010: Fail, Britannia Mon, 08 Nov 2010 08:18:58 +0000

A few days ago, I wrote about car sales all over Europe falling faster than a…..erm……really fast thing. I also wrote how this didn’t bode well for the UK car market. Well, the figures are in and, unfortunately, I wasn’t wrong – this time. It’s pretty bad. New car registrations fell 22.2 percent in October. The Society of Motor Manufacturers and Traders (SMMT) also said that further declines are likely for the rest for the year. Oh goody(!) Looks like I’m going to have to find more words for “dropped”.

Shall we take a look at the carnage? It’s not for the faint of heart.

First up, the Americans. Ford, one of the barometers of the European car market, had a pretty bad month in the UK. Their sales, year-on-year, fell 30.31 percent. What made this statistic even more bizarre was the fact that the Ford Fiesta was still the bestselling car in the UK. Which will give you some idea of how much other Ford cars were hit. General Motors had a bit of a mixed month.  Chevrolet fell 34.87 percent, but Vauxhall didn’t have that bad a month falling only 17.53 percent. Cadillac had a stellar month as their sales rose 100 percent. They sold one car. That’s right, in the whole of the UK, Cadillac sold just one single, solitary car. Go, Cadillac(!) As per normal, I won’t bother with Chrysler and their brands as they are marginal in the UK. But trust me, they were really bad.

Over to the Orient and it was another bad month all around. Toyota plunged 35.05 percent, Honda dropped 29.93 percent and Mazda fell 32.22 percent. Only Nissan and Mitsubishi had a relatively good month. Don’t get me wrong, they still lost sales, but not by as much. Mitsubishi fell 16.11 percent and Nissan dropped 14.96 percent. Jumping over to South Korea, I was hoping there would be some good news there. There wasn’t. It was worse. MUCH worse. Kia sales plunged 51.09 percent and Hyundai collapsed by 57.42 percent.

Time to go to Europe. In France, things didn’t improve. Peugeot sales fell 30.66 percent and Citroen’s dropped 23.07 percent. Renault’s sales weren’t that bad, but still poor. Their sales dropped only 11.18 percent.

Jumping the border into Italy and we have another mixed bag. Fiat’s sales plunged 46 percent, but strangely, Alfa Romeo had a great month. Their sales rose 21.65 percent.

Now Germany. Again a mixed bag. Mercedes-Benz’s sales fell 17.01 percent, but their Bavarian rivals, BMW, saw sales grow a massive 24.79 percent. That’ll get under Mercedes’ skin. Over at Volkswagen, the growth wasn’t where anyone expected. In these times of economic hardship, you’d think people would seek out cheap, well made cars like Skoda, right? Well, as we showed with Hyundai and Kia, that just simply isn’t true. Sales at Skoda fell 31.27 percent. As did sales at their sister brand SEAT; they fell 13.53 percent. Only Volkswagen and Audi registered growth, with sales growing 8.81 and 4.25 percent, respectively. Go figure.

Overall, a pretty poor month, with many more to come. If you want to see the full carnage, you can download the full report from SMMT here. If it carries on like this, I expect some manufacturers will start to withdraw from the UK market. Things are rough all over.

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Government Motors: Chinese Government, Kuwaiti Government … Sun, 07 Nov 2010 14:44:12 +0000

The Freep says GM has appointed a Vice President of diversity. And they’ll need one. GM’s post-IPO ownership roster shapes up to be quite, well, diverse. China’s SAIC appears to be gung-ho for the IPO. And it’s not just the Chinese government that likes the idea of owning a little bit of America.

Reuters reports that Kuwait Investment Authority (KIA), a sovereign wealth fund, has indicated their interest in purchasing part of General Motors. Bader al-Saad, KIA’s Managing Director, thinks he might be getting a deal: ” If it is feasible for us we will look in it…if it is something cheap, we are interested of course.” If the KIA were to buy a stake in GM, it would be rather interesting. A quick look at the Wikipedia page for the KIA shows that that they also hold a significant stake in Daimler AG; almost 7 percent of the Stuttgart company. What is to stop the KIA acting like a bridge between GM and Daimler? Daimler needs the economies of scale and some European technology wouldn’t go amiss at GM. Yes, it is a bit farfetched. What is not so far-fetched is that all this talk that GM needed to be rescued because one day we might need them to build tanks and halftracks, sounds sillier by the minute.

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Killer Keyless Ignition? Sun, 07 Nov 2010 11:44:03 +0000

Toyota’s legal problems are piling up. It is now being alleged that they killed a lawyer. The New York Daily News reports that 79-year-old lawyer Ernest Codelia Jr died of carbon monoxide poisoning and his partner, Mary Rivera was brain damaged. And their Lexus is being blamed. How come?

On February the 27th of 2009, Mary Rivera parked their Lexus in the ground floor garage attached to their home. Accidentally, she left the engine running. The next day, family members went to their home to find that Mary was unconscious on the bedroom floor and her partner, Ernest in bed, dead. An autopsy showed that Mr Codelia Jr’s blood was filled with carbon monoxide.

Carbon monoxide is an odorless, colorless and toxic gas. The U.S. Consumer Product Safety Commission (CPSC) recommends that every home should have a carbon monoxide (CO) alarm. Apparently, the carbon monoxide invaded the bedroom. Miss Rivera survived but now cannot walk and speaks with difficulty. Now while this is rather sad, what has this got to do with Toyota getting sued? What did they do wrong?

Lawyer Noel Kushlefsky has filed a wrongful death suit in Brooklyn Federal Court against Toyota, the makers of Lexus cars. The suit claims that the keyless ignition feature violates federal safety standards because the engine can continue to run indefinitely even after the driver walks away with key fob that communicates with the car. Mr Kushlefsky accuses Toyota of failing to install a safety switch. A switch could turn the ignition off if the car had been idle for a while or unoccupied for a period of time. “It creates certain safety risks that did not exist with conventional key technology,” the suit says.

“This is a cool little bell-and-whistle to sell cars, but they have to address problems that have sprouted up,” said Mr Kushlefsky. The lawyer met with the NHTSA, and the agency is assessing keyless ignition systems and is aware of “some potential safety issues”.

Although conjecture, the article suggests that because the couple had the car for a short while, they may have been unfamiliar with the technology. Also, because the engine runs so quietly, Miss Rivera may not have realized that it was still running.

Lexus hasn’t commented on the issue. The suit has been filed. A similar case is reported from Florida. As the picture illustrates, our homes are full of carbon monoxide dangers. A running car in the garage is only one of them.

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Hyundai Way Up Down Under Sat, 06 Nov 2010 09:53:53 +0000

Australia is pretty much a stronghold for Toyota. Looking at the figures, it seems that Aussies like well-made, cheap reliable cars. And to be honest, who doesn’t like those kinds of cars? But what happens when someone else comes to your market, and does well what you do well? Well, you get worried.

Paddock Talk reports that Hyundai has had a record October since Hyundai came to Australia in 1986. In October, Hyundai sold 6,359 units, which represents a monthly market share of 7.9 percent. Hyundai Australia’s year to date sales look even better: 67,941 units sold, a 26 percent gain from last year, and a 10.8 percent market share for the first 10 months. “This is yet another outstanding result for the team at Hyundai and the Hyundai Dealer network. We are excited to have surpassed our best-ever annual sales record in the first ten months of this year,” said Damien Meredith, Hyundai Australia’s Director of sales. I kind of guessed he’d be pleased at this news.

I’m also guessing that someone at Aichi City is probably not so pleased at this news. Watch out, Toyota! Hyundai are coming after you in Australia. Your move, Toyota…

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Weekend Head Scratcher: Rick Wagoner. Was He All Bad? Sat, 06 Nov 2010 09:37:17 +0000

History is written by the victors, or so the saying goes. You lose, not only do you get beaten up in real life, but also in the history books. Few losers come much bigger than Rick Wagoner. The man who oversaw the last slide into Chapter 11. Yep, there wasn’t much love out there for “Red Ink” Rick. Until a few days ago.

I was grazing the internet when I found this article from the Wall Street Journal where they talk about a bloke called Malcolm Gladwell. Now Mr Gladwell has a different take on Rick Wagoner’s legacy. Malcolm (if I may be so informal), posits that Rick’s career wasn’t the failure that history is making of it. Mr Gladwell supports this theory by pointing out that “Rabid” Rick cut hourly labor costs and improved productivity until they were in line with Toyota’s US plants. He also managed to shift health care obligations on the unions via VEBA. Then Mr Gladwell jumps the shark by saying that Wagoner delivered GM to the point where its product quality and features were competitive with those of the best auto makers in the world. Which weren’t actually “Rabid” Rick’s achievements but the Maximum’s ones. “What Rattner cannot seem to see,” says Gladwell, “is that his contempt for GM’s leadership is contradicted by the evidence of the company’s accomplishments.”

This got me thinking. Have we been blinded and maybe there was more to Mr Wagoner’s tenure than meets the eye? Or is this a load of tosh and “Rabid” Rick’s career had more failures than successes?

What say you?

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Toyota’s Profits. Whodunnit? Fri, 05 Nov 2010 12:23:00 +0000
When GM was in its final throes (about 2000 onwards) it was quite easy to see that GM would go under. Even though they were posting records profits, anyone but the shills knew that these profits came from the SUV boom and not from any long term sustainable plan. That’s fair to say, right? So now let’s move to Toyota. The cry I hear, these days, is “Toyota is the new GM! Toyota is the new GM!” (Why people have to say things twice, I’ve no idea. I’m not deaf, just stupid.) And there is certainly some evidence to suggest that. Piling on the incentives, suspect quality, etc. But then something comes along which, seemingly, blows that theory out of the water.

The BBC reports that Toyota is announcing massive profits for the second quarter (about the height of the witch-hunt). Toyota earned for the period of July to September (Toyota’s fiscal year goes from the beginning of April to the end of March) 98.7b Yen. That’s about $1.222b. Toyota was so bullish about this profit that they raised their profits forecast (again) to 380b Yen, which is about $4.7b.Toyota’s executive vice president, Mr Satoshi Ozawa, did give the customary warnings about the strong yen and also said of a “very tough business environment, characterized by the radically and seriously appreciated yen in recent months, the risk of slowdown in demand recovery in the United States and Europe and falling demand following the end of the eco-car subsidies in Japan.”  The only area he didn’t mention was India and China, the two markets which Toyota were weak in.

When I read this story, I just couldn’t believe it. Where did those profits come from? So I went to Toyota’s official website to dig a little deeper.  On it, it gives a breakdown of where the profits came from.

In Japan, operating loss improved by 205.7 billion yen, to a loss of 52.0 billion yen.”

Ok, so the profits didn’t come from Japan.

In North America, operating income increased by 119.0 billion yen to 145.9 billion yen, including 9.8 billion yen of valuation losses on interest rate swaps. Operating income, excluding the impact of valuation losses from interest rate swaps, increased by 143.7 billion yen to 155.7 billion yen. The increase was due to improved earnings from the financial services segment.

OK, some of the profits came from North America.

In Europe, operating loss improved by 9.7 billion yen, to a loss of 8.9 billion yen.
Operating income in Asia increased by 98.8 billion yen, to 164.2 billion yen.
In Central and South America, Oceania and Africa, operating income increased by 32.3 billion yen to 72.9 billion yen..

So, losses in Europe, unsurprisingly, and increased income from Asia and the rest of world is good news. But where did the majority of their profits come from? Then the answer comes in the next paragraph.

In the financial services segment, operating income increased by 59.3 billion yen, to 183.7 billion yen compared to the same period last fiscal year, including 0.4 billion yen of valuation losses from interest rate swaps. Excluding these valuation losses, operating income increased by 76.6 billion yen to 184.1 billion yen. This was thanks to our better-than-expected used car pricing that resulted in a decrease in our loan-loss and residual-loss related expenses, partially through reversal of the relevant provisions as reported for the first quarter as well as an increase in our lending balance following reinforcement of our financing programs.

Toyota’s financial services are going great guns! Just like another company, before its bankruptcy… Now, as long as you don’t write mortgages for houses, financial services always have been like printing money for a car company.

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BMW’s Profit Margins Are Something. To Worry About Fri, 05 Nov 2010 12:04:37 +0000

BMW is on a roll at the moment. They’ve booted Mercedes-Benz (their most hated rival) off the number one slot in India, they’re making big steps in China and their profit is rising fast. That last point is the fulcrum of this article. You see, profit is where BMW is forecast to have problems. Not lack of profits, but the size of them.

Bloomberg reports that although BMW achieved a profit margin of 8.1 percent, it’s still the smallest of the 3 German luxury car makers. Mercedes-Benz had an operating profit margin of 9.5 percent and Audi’s was 11 percent. The (relatively) low operating profit margin is, as Bloomberg posits, indicative of BMW’s vulnerability.   Mercedes-Benz is the world’s largest maker of trucks and buses. Not to mention it has alliances with Renault & Nissan and a joint purchasing department for certain parts with BMW which will further help their margin. Audi, unsurprisingly, has the higher margin due its cost sharing with the rest of the Volkswagen group.

Despite announcing high profits of €871 million ($1.229 billion) for the 3rd quarter, BMW’s stock fell 3.3 percent on the stock market. Which is also indicative of an unhappy market. Though we know how accurate the market can be. “The profit margin looks clearly weak, much lower than Audi and Mercedes,” said Adam Hull, an analyst with WestLB, “The guidance is low. They should be able to do better.” Mr Hull has a “reduce” rating on BMW shares.

BMW refutes this criticism. “We’re at the beginning of a major model offensive,” said CFO Friedrich Eichiner, “We’re on an upward trend.” So BMW’s CEO, Norbert Reithofer, raised his operating profit target to more than 7 percent. Up from 5 percent. This disappointed some investors, according to Bloomberg. Especially when Daimler is aiming for an operating profit margin of at least 10 percent by 2012. BMW’s target for 2012? 8 percent. The message is clear from the market for BMW: Fast cars doesn’t necessarily equal fast money.

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Toyota Makes Big Cuts In Europe…To Emissions. Fri, 05 Nov 2010 09:22:46 +0000

Toyota is probably feeling a little unloved right now. The US government has been trying to burn them at the stake, Chinese buyers are shunning them and even the Canadians are even saying “No, eh?” (My experience of Canadians is pretty much limited to “South Park” and “Due South”). But love and good news can come from the most unlikely of places.

Reuters reports that Toyota has made huge steps to complying with EU legislation several years ahead of schedule. The EU is getting quite serious with CO2. Official EU data, which was analyzed by green transport campaigners T&E, shows that Toyota has cut the average CO2 emissions from its cars by 10 percent. This was more than five times the pace of BMW, last year’s leader. The average CO2 emission for Toyota’s cars in 2009 was 132g/km. This puts it up with Fiat and PSA as the companies best placed to meet the EU’s target of 130g/km by 2015. With quite a few years to spare.

“Three years ago the car industry said it could not deliver car CO2 targets on time but is now set to achieve them years ahead of schedule,” said Jos Dings, director of T&E. When the conversation turned to van emission standards (about 175g/km by 2016), Mr Dings got rather cynical, “The same industry is saying van CO2 limits cannot be met – it is time the credibility of these claims was questioned,” Makes you wonder what the big problem about cutting CO2 really is. I thought diesel was the panacea to everything? High mileage and low CO2 emissions. Or do the credibility of those claims need questioning…?

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Best Selling Luxury Brand In The U.S.: Is Lexus Buying The Title? Thu, 04 Nov 2010 07:19:16 +0000

Toyota drops in China, Canada, The United States, Japan and (almost certainly) Europe, too. You’d think good news would be scarce. And you’re right, it is! But wait, there’s one!

Bloomberg reports that because Lexus made sales gains (mainly through incentives) in October, Lexus is now back in contention to keep its title of “best selling luxury brand in the United States”.

Earlier in the year, there was a real possibility that it would be a 2 horse race, BMW and Mercedes-Benz. But because of the good October Lexus had, it’s now a 3 horse race.

Like I mentioned earlier, a key reason behind this sales growth is heavy discounting. In October, Lexus spent $2,152 per vehicle. Compare that to a year earlier, when Lexus spent only $923 per vehicle.

Even BMW was surprised at Lexus’ comeback. “Toyota has been much more aggressive than they’ve ever been,” said Jim O’Donnell, President of BMW’s North America, “We’ve not got Lexus joining the fray where they’ve always stood on the sideline and sort of watched.” In the month of October, Lexus sold 21,091 units, Mercedes-Benz sold 18,351 and BMW sold 19,272. This puts year to date sales at Lexus: 183,529, Mercedes-Benz: 178,080 and BMW: 176,736. Looks like this one is going down to the wire. See you at the end of December!

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Things Get Chilly In The Great White North. For One Car Maker Wed, 03 Nov 2010 10:21:36 +0000

The Vancouver Sun reports that pretty much, across the board and across the border, Canadian sales rose. GM’s sale rose 11 percent year on year, Ford’s sales rose 8 percent and is now within a whisker of taking the number one slot from General Motors. Honda’s sales grew 14 percent. As did Nissan’s at 4.5 percent. And Hyundai-Kia who reports rises of 8.6 percent and 17 percent, respectively. Even the smaller players had reasons to celebrate. VW went up 21.5 percent. Mitsubishi has a stonkingly good month with sales rising, YOY, by 27.2 percent. Even Volvo’s sales grew 13.9 percent. Yep. Life is good, north of the border. Except for one.

The world’s largest car maker, Toyota, saw sales decline 22.7 percent. Over the year of 2010, Toyota Canada’s sales have dropped 12.4 percent to 150,119 units. This is bad news for ToMoCo. But wait, there’s less!  What made this sales decline even worse was the fact that Toyota had just introduced their youth brand, Scion, to Canada in a bid to breathe life into their Canadian subsidiary. In its first full month of sales, Scion could only clock up sales of 247 units over a dealership network of 46. If Toyota has a secret weapon to boost sales, they might want to think about activating it sometime soon.

And while we are at it: Toyota’s sales dropped in another country also. Starts with a C also. But is a bit bigger than Canada: China. Toyota sales in China fell 6.0 percent in October to 61,600 vehicles, marking the first year-on-year decline in 18 months. That hurts.

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