Tag: finances

By on September 13, 2017

Concept EQ, Exterieur Concept EQ, exterior

Everyone’s doing it. It’s as popular as the fidget spinner and Pokémon Go crazes all those years months ago. In a rush to signal their environmental bonafides and display their dedication to the Next Big Thing, luxury automakers are tripping over themselves in an effort to promise an all-electrified model lineup as soon as technology and finances allow.

This time, it’s Mercedes-Benz. The world’s oldest car brand doesn’t want its rivals cashing in once governments around the globe start turning off the fossil fuel taps. So, earlier this week, Daimler CEO Dieter Zetsche stepped up and made a promise we’ve heard ad nauseum as of late: every model in the brand’s lineup will soon sport some form of electric propulsion, be it a hybrid setup or full-on battery electric powertrain.

For Mercedes-Benz, this means 50 hybrid or EV models, including at its irrelevant-to-Americans Smart brand. The move isn’t without a steep cost, however — Daimler is bracing for a slashing of vehicle profit margins. In some cases, the green collected from green cars could be half that of a gasoline Benz. What to do? (Read More…)

By on August 31, 2017

kia logo emblem

Seoul Central District Court ruled against Kia Motors on Thursday, ordering the automaker to pay around 420 billion won, or $374 million, in unpaid wages. Kia employees first filed an initial lawsuit in 2011, claiming a 659 billion won wage disparity, following it up with an additional suit in 2014.

However, the automaker claims the final cost will be closer to 1 trillion won, or about $890 million, and could result in a third-quarter operating loss. Interestingly, this is roughly the same amount workers demanded over their six-year legal dispute (after interest).

“The current operational situation is such that the ruling amount is [difficult] to bear,” Kia said in a statement. (Read More…)

By on May 23, 2017

ff_91_exterior_6

China’s Netflix equivalent, LeEco, confirmed it would be eliminating the better part of its North American workforce today. LeEco has recently gotten involved in a myriad of expensive tech-focused endeavors that have wound up screwing its finances six ways from Sunday. One of those projects was serving as the primary financial backer of America’s Faraday Future, the electric car company we’ve been scrunching our faces at for over a year now.

Faraday seems to have encountered or created every problem an automotive startup could imagine and, with its primary source of income shrinking its U.S. employee base by 70 percent, things have never looked worse.  (Read More…)

By on May 19, 2017

Aston Martin Logo Emblem

Rumors that Aston Martin is destined for an initial public offering, either eventually or imminently, have persisted ever since former parent Ford offloaded the British luxury marque in 2007.

The brand has come a long way since Ford dropped it off at the orphanage by expanding into new segments, spawning a sub-brand, and entering the non-automotive realms of merchandise and luxury speedboats. As its trajectory increasingly mirrors that of recently spun-off Ferrari, sources claim an IPO is right around the corner. (Read More…)

By on May 10, 2017

toyota camry

Even as it develops efficient new platforms and streamlines its operation where it can, Toyota finds itself against the ropes as a falling yen and rising costs sends profits tumbling. Its end-of-fiscal-year financial statements, released today, are enough to send bean counters to the medicine cabinet in search of antacid, while the company’s president warns of more trouble ahead.

To Akio Toyoda, the increasingly gloomy picture has all the hallmarks of a failing sports team. (Read More…)

By on April 28, 2017

2017 Ford F-150 Lariat - Image: Ford

What a difference a few (hundred thousand) recalls make. In a sales market best described as stagnant, a widespread vehicle glitch can dog an automaker’s balance sheet. That seems to be the case at Ford Motor Company, which saw its first-quarter profit fall 35 percent on a combination of factors — not the least of which was a pair of recalls of engine fires and faulty door latches.

Elsewhere in the domestic market, General Motors rode to the financial finish line with a record post-bankruptcy net income while Fiat Chrysler Automobiles climbed further into the black. (Read More…)

By on April 3, 2017

tesla model-s-rear

For a car company that sells a tiny fraction of the volume put out by the likes of Ford, General Motors and Fiat Chrysler Automobiles, Tesla’s investors have given the electric automaker clear bragging rights.

Despite generous debt, tight timelines and razor-thin profitability, Tesla’s stock market value sprinted past Ford today, placing it in the number two spot among domestic automakers. The company, which has yet to offer a vehicle most normal Americans can afford, holds a market cap of $47.81 billion at last count. (Read More…)

By on March 31, 2017

Project Cars on Craigslist

I was still in my 20s, browsing my local library’s jazz catalog with what I hoped was an open mind, when I found Brian Jackson and Gil Scott-Heron’s “Winter In America” tucked between Wynton Marsalis and Chick Corea. I had a vague idea of who Scott-Heron was from my years in school, so I snagged it, put the CD in my Fox on the way home, and I was … struck dumb. This was something new for me, both musically and politically. In the years since, I’ve often thought that if God truly loved me he would have given me Gil Scott-Heron’s steady baritone instead of my over-modulated tenor.

In the years that followed, I persevered as a fan of Scott-Heron through the man’s ups and downs. Shortly before his death, he stunned me and everybody else again with I’m New Here, a heartfelt but judiciously studied effort that was aimed with laser precision at rap fans and the regular-at-Yoshi’s crowd alike. In that album’s title track, Scott-Heron gathers up what is left of his voice and growls, “No matter how far wrong you’ve gone / you can always turn around.” It was a knowingly ironic statement from a man who could clearly foresee his imminent death from AIDS-related complications, but it was also a final benediction, a last bit of weary advice from a man who had long viewed himself as a prophet without honor in his own community.

That phrase — “No matter how far wrong you’ve gone / you can always turn around” — has weighed heavily on me lately, for any number of reasons. I have a few friends, some more dear to me than others, who would benefit mightily from a serious application of that advice. But since this is at least nominally a blog about cars, let’s talk about what it means to our four-wheeled decisions, instead of how it might apply to relationships that should have been dropped in the Marianas Trench years ago.

Yes, let’s do that.

(Read More…)

By on March 16, 2017

2018 Volvo XC60, Image: Volvo Cars

Volvo denies that it wants to return to publicly listed status, but a new round of fundraising has many believing the Swedish automaker is about to end its 20-year absence from the stock market.

According to the Financial Times, the Geely-owned company hopes to raise about $500 million from a new batch of preference shares. Unlike the last time it held out its hat, this time Volvo wants Chinese buy-in. (Read More…)

By on March 13, 2017

2017 Chevrolet Sonic, Image: General Motors

General Motors isn’t finished slashing products or dialing back plans to bolster its financial standing.

After unloading its near century-long Opel and Vauxhall holdings to France’s PSA Group, a move that came after failed attempts to return the European brands to profitability, GM plans to turn its focus on underperforming products in North America. There’s a chance that a model you hold dear could find its way to the chopping block. (Read More…)

By on February 7, 2017

2017 Chevrolet Tahoe Z71 Midnight Edition

The grim memories of 2008 and 2009 only plague Renaissance Center denizens in the form of night terrors now, as General Motors finds itself on financial ground that’s oddly solid, considering some of the factors effecting the company.

Faced with a slowdown in the automotive market in 2016, the automaker — like so many others —boosted incentives on its vehicles. Meanwhile, the U.S. public’s insatiable thirst for SUVs and crossovers left some of the General’s cars high and dry, sending inventories soaring to very unhealthy levels. While new crossovers were in the pipe in 2016, those lucrative models weren’t scheduled to land until this year. GM’s European division, meanwhile, struggled to rise out of the red.

Despite all of this, the company posted record income and revenue in 2016, according to an earnings report released today. (Read More…)

By on October 31, 2016

2015 Ford Mustang Flat Rock production

General Motors and the Ford Motor Company both saw U.S. sales declines in the third quarter, but GM was the only one achieving earnings that widely beat expectations. Still, which company is playing the game better is up for debate.

This could turn out to be an Ant and the Grasshopper situation if there is another economic downturn on the horizon. The ant-like Ford could be more ready for an economic winter, while the improvident Grasshopper Motors is left out in the cold with acres of unsellable vehicles — forced to eat its own legs for sustenance.

Of course, if there isn’t an economic downturn, Ford is going to look like a lame duck next to GM’s golden goose.

(Read More…)

By on October 12, 2016

2015 Volkswagen Beetle Classic, Image: Volkswagen Group of America

Volkswagen’s plan to cut costs by cancelling underperforming models isn’t enough to right the scandal-rocked ship.

With an incredibly powerful workers union breathing down its neck, trimming its ranks has proved a tough operation. Meanwhile, there’s only so many models it can drop, and bills are coming due from the many fines, settlements, and lawsuits stemming from the diesel debacle.

How does Volkswagen get rid of 25,000 employees while placating a union boss who sits on the supervisory board?

According to Reuters, the answer comes down to one word: attrition. Specifically, retiring Baby Boomers. (Read More…)

By on September 22, 2016

General Motors #AMERICA

General Motors is searching for savings under every RenCen couch cushion as it ramps up a profit-boosting cost-cutting effort.

The automaker has already chopped plenty of what it sees as fat, and is so confident in its streamlining abilities that it now claims it could weather a major plunge in sales. Even, say, a 40-percent dropoff.

For a company that knows all about sales plunges — recent ones, too — this is pretty confident talk. It has to be, as GM wants you — yes, you! — to invest. (Read More…)

By on September 2, 2016

Aston Martin Vanquish. Picture courtesy Aston Martin

The Aston Martin Cygnet was just the beginning.

For those who thought the luxury automaker’s now-defunct rebadged Toyota city car was a weird idea (and that includes just about everyone), just wait. Aston Martin is now eager to sell you anything — your clothes, your baby stroller, and even your house. (Read More…)

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