The Truth About Cars » Investment http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Wed, 02 Sep 2015 18:59:32 +0000 en-US hourly 1 http://wordpress.org/?v=4.2.4 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 » Investment http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Equinox Gives Oshawa Consolidated Line Extended Life http://www.thetruthaboutcars.com/2015/08/equinox-gives-oshawa-consolidated-line-extended-life/ http://www.thetruthaboutcars.com/2015/08/equinox-gives-oshawa-consolidated-line-extended-life/#comments Wed, 19 Aug 2015 20:21:42 +0000 http://www.thetruthaboutcars.com/?p=1145993 GM Canada announced Wednesday it will make a small investment in Oshawa Assembly’s Consolidated Line thanks to increased demand of the Chevrolet Equinox. “It’s a modest investment in terms of its size, but it increases the volume of stamping we do at CAMI to increase the run. (The increased stamping) will then boost Equinox production in Oshawa,” GM Canada’s VP of […]

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GM Oshawa Plant Closure

GM Canada announced Wednesday it will make a small investment in Oshawa Assembly’s Consolidated Line thanks to increased demand of the Chevrolet Equinox.

“It’s a modest investment in terms of its size, but it increases the volume of stamping we do at CAMI to increase the run. (The increased stamping) will then boost Equinox production in Oshawa,” GM Canada’s VP of Corporate and Environmental Affairs David Paterson said in an interview with TTAC.

More body panels are stamped at CAMI than that plant’s assembly line can use, which required GM to utilize its “shuttle program” to transport excess Equinox bodies to Oshawa’s Consolidated Line for final assembly, according to GM.

The majority of the $12 million CAD investment will go to CAMI, though the detailed amount was not disclosed. Additional labor will not be needed to produce the additional Equinoxes.

While the success of an 11-year-old model (the Equinox went into its second generation as an enhanced refresh) is newsworthy, there is a larger issue at play.

“That investment has the effect of extending further the Consolidated Line until at least 2017,” said Paterson.

This is the fifth time the Consolidated Line’s death has been postponed in the last ten years, Paterson said. The Consolidated Line was most recently scheduled to shut down in 2016.

Speaking of the Consolidated Line, Paterson said: “It’s the gift that keeps on giving.”

However, the announcement still doesn’t ensure the long-term viability of the manufacturing facility.

Camaro production in Oshawa is scheduled to end this November, while next-generation Buick Regal production is rumored to move solely to Russelsheim, Germany in 2017.

While Cadillac currently produces the XTS in Oshawa, that nameplate will be discontinued at the end of its lifecycle in 2019. However, that best-before date doesn’t secure Oshawa until 2019. Production could be moved to Hamtramck or Fairfax as those assembly plants also build vehicles sharing the same platform, which are the Impala and LaCrosse. Should GM not opt to move production, but continue to sell the XTS in North America, the XTS could be the first Cadillac produced in China and imported to North America — but that’s a far reach.

GM announced they would make a $250 million CAD investment in CAMI for flexible manufacturing similar to Oshawa’s main flex line, seemingly securing the Equinox in Ingersoll, but no investments have been announced for continued production in Oshawa.

If manufacturing departs, GM looks to keep a significant presence in Oshawa for connected car R&D.

Former mayor of Oshawa, John Gray, has encouraged Canadians to boycott GM if jobs are lost. The future of Oshawa assembly activities won’t be announced until 2016 when the company starts labor talks with Unifor.

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GM Investing $877M into Flint Pickup Plant http://www.thetruthaboutcars.com/2015/08/gm-investing-877m-into-flint-pickup-plant/ http://www.thetruthaboutcars.com/2015/08/gm-investing-877m-into-flint-pickup-plant/#comments Tue, 04 Aug 2015 16:00:26 +0000 http://www.thetruthaboutcars.com/?p=1133409 General Motors will spend $877 million to upgrade its Flint, Michigan pickup plant, the automaker announced Tuesday. The assembly plant, which is the oldest GM factory in North America, will get a new body shop as part of the investment along with general improvements. The plant makes full-size trucks for GM, including heavy duty versions. […]

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GM Truck Assembly Flint

General Motors will spend $877 million to upgrade its Flint, Michigan pickup plant, the automaker announced Tuesday.

The assembly plant, which is the oldest GM factory in North America, will get a new body shop as part of the investment along with general improvements.

The plant makes full-size trucks for GM, including heavy duty versions.

The $877 million improvement was the final plant improvement announcement for the automaker, who said in April that it was spending more than $5.4 billion at its facilities.

Last month, GM announced it would spend $1.4 billion at its Arlington, Texas SUV plant for a new body shop and paint shop. That plant makes full-size SUVs for several automakers including the Cadillac Escalade and Chevrolet Suburban.

In 2011, GM announced a $1 billion investment for the Flint plant, which included a new paint shop. According to GM, the Flint Truck Assembly plant is a destination for truck buyers who want to watch their trucks roll off the assembly line.

Construction is scheduled to begin on the new facility in 2016 and will be complete in 2018.

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Jeep Points to Map of India, Says Let’s Print More Money Here http://www.thetruthaboutcars.com/2015/07/jeep-points-to-map-of-india-says-lets-print-more-money-here/ http://www.thetruthaboutcars.com/2015/07/jeep-points-to-map-of-india-says-lets-print-more-money-here/#comments Wed, 01 Jul 2015 19:00:11 +0000 http://www.thetruthaboutcars.com/?p=1104881 More and more automakers are looking at exotic locales to produce their wares (us Canadians can consider Mexico exotic thanks to its ice-free beaches) as they expand their brands and explore in-roads to untapped markets. For Jeep, that means investing in a shared money-printing press with an unlikely partner: Tata, the parent company of Land Rover. FCA […]

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2015 Jeep Renegade

More and more automakers are looking at exotic locales to produce their wares (us Canadians can consider Mexico exotic thanks to its ice-free beaches) as they expand their brands and explore in-roads to untapped markets.

For Jeep, that means investing in a shared money-printing press with an unlikely partner: Tata, the parent company of Land Rover. FCA will put $280 million USD into joint venture Fiat India Automobiles Private Limited which, since 2007, has solely produced Fiat models.

The investment will “support the production of a new Jeep vehicle and is expected to begin production in the second quarter of 2017,” according to statement released today by FCA. Jeep did not give further details on the new model.

With Sergio Marchionne’s hunger for consolidation, this could be seen as a sign of interest in a more formal arrangement between FCA and India’s Tata, especially when you consider the FCA executive’s desire for a Range Rover-esque model.

“We are pleased that this investment will strengthen FCA presence in India and are confident in the ability of the joint venture to produce world class products like those carrying the legendary Jeep nameplate,” Marchionne said.

This announcement is part of a wider expansion by Jeep into new markets. From The Detroit News:

FCA plans to produce 1.9 million Jeeps by 2018 at 10 plants in six countries: the U.S., Italy, China, Brazil, India and one other yet-to-be-announced country. Two years ago, only 798,000 rolled out of four plants in the United States.

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Editorial: Canada Can Keep Kissing Auto Investment Goodbye http://www.thetruthaboutcars.com/2014/04/editorial-canada-can-keep-kissing-auto-investment-goodbye/ http://www.thetruthaboutcars.com/2014/04/editorial-canada-can-keep-kissing-auto-investment-goodbye/#comments Thu, 10 Apr 2014 11:00:59 +0000 http://www.thetruthaboutcars.com/?p=791649 Globally, auto makers spent $17.6 billion on expanding manufacturing facilities – and none of that was spent in Canada. Citing a study by the University of Windsor, The Globe and Mail reports that the last time any new investment was received by Canada’s industry was in 2012, when $180 million was spent on a single project. […]

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800px-Oakville_Assembly-450x298

Globally, auto makers spent $17.6 billion on expanding manufacturing facilities – and none of that was spent in Canada.

Citing a study by the University of Windsor, The Globe and Mail reports that the last time any new investment was received by Canada’s industry was in 2012, when $180 million was spent on a single project. On the other hand, Mexico, which is enjoying a booming automotive sector, received $6.3 billion.

What was once the 4th largest vehicle assembly site is now the 10th largest, and output fell in 2013 by 4 percent. On the one hand, Canada is not alone. The report states that Germany has received no new investment over the past few years, and only nominal investments in Japan.

But all three countries face a similar problem. Nearby sites are cheaper to build cars in, at the expense of “domestic” locations. Former Easten Bloc countries like Poland, Hungary, the Czech Republic and Slovakia are popular sites for German OEMs, while Japanese auto makers have been ramping up production in Thailand. In both scenarios, the vehicles produced in those countries are considered to be just as high quality as their domestic counterparts, but at much lower costs.

Canada’s situation is particularly troubling. High costs for everything from labor to energy, combined with a reluctance on the part of the government (and general public) to match the generous subsidies offered by American and Mexican governments, has led to a major contraction of the auto manufacturing sector. Until recently, a high Canadian dollar was also weighing negatively on the sector, but a recent 10 percent haircut may help things along.

Canada will inevitably have to make the same choice that Australia faced just months ago: continue to offer subsidies to the auto industry to entice them to keep building cars in Canada, or watch it disappear. Proponents of subsidies argue that they are a pragmatic, reality-based choice given the current environment, and that the auto industry provides good, middle-class jobs in an economy that is in dire need of them.

Those arguing against will posit that the government should not be in the business of propping up uncompetitive businesses. The end of the auto industry will allow Canada to transition to a different kind of economy, and workers can simply go where the jobs are (namely resource and petroleum extraction in Alberta and other areas).

There are problems with both arguments. With a much smaller population than the United States, and a much higher standard of living than Mexico, continuing to compete in the subsidy game will simply be a race to the bottom for Canada. On the other hand, the notion that good jobs will materialize in place of auto manufacturing jobs lies somewhere on the spectrum between ideological fantasy and efficient-markets dogma. The expectation that laborers can pick up and go where the jobs are, in a quasi-nomadic fashion, ignores the many unquantifiable but tangible human and cultural factors that exist in the real world.

With that in mind, there’s one way to keep the workforce competitive and the economy strong, while avoiding the perpetual subsidization of the auto industry. Let the plants live or die on their own. Use the subsidy money to retrain former auto industry workers, where its picking up a new trade or more abstract programs like entrepreneurship training, business loans or anything else that can encourage productive activity in the economy.

It’s not like every plant will suddenly shut its doors either. Honda and Toyota will keep cranking out Civics and Corollas at their plants, which are the kinds of cars that Canadians have traditionally purchased (and given the way that current trends are going, are likely to keep buying). GM’s Oshawa plant, which builds the Impala, might not make it. And the Windsor plant, which builds the very popular Chrysler minivan, looks to be sticking around for at least a few years. If FCA wants to move production to Mexico or Italy or anywhere else in the global arena of automobile production, so be it. The money is better invested in the people of Canada. And with any luck, they’ll be able to vote with their newly fattened wallets when it comes time to purchase their next car.

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Indian Car Market Sees First Yearly Sales Decline Since 2002 http://www.thetruthaboutcars.com/2014/01/indian-car-market-sees-first-yearly-sales-decline-since-2002/ http://www.thetruthaboutcars.com/2014/01/indian-car-market-sees-first-yearly-sales-decline-since-2002/#comments Sun, 12 Jan 2014 16:17:02 +0000 http://www.thetruthaboutcars.com/?p=696641 For the first time in more than a decade, new car sales in India have failed to post a year-over-year increase. Instead, a sharp drop in sales spells bad news for carmakers with heavy investments in that important developing market. According to information released by the Society of Indian Automotive Manufacturers and reported by the […]

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ford-ecosport

For the first time in more than a decade, new car sales in India have failed to post a year-over-year increase. Instead, a sharp drop in sales spells bad news for carmakers with heavy investments in that important developing market.

According to information released by the Society of Indian Automotive Manufacturers and reported by the WSJ, passenger car sales declined by 9.6 percent in 2013 to around 1.8 million units. Total passenger vehicle sales were down 7.2 percent to 2.55 million units. Many factors contributed to the decline, but inflation is the primary culprit. This past year in India saw a slowing of economic growth as prices surged, squeezing the purchasing power of the burgeoning middle class. Besides the spike in new-vehicle prices, the general cost of ownership has also risen. The rollback of government controls on fuel prices has led to higher costs for gasoline. Loan rates have also risen, giving many consumers second thoughts about purchasing a new car. The decline of new car sales illustrates the pitfalls of investing in emerging markets, which demonstrate strong aggregate growth but are often volatile in nature.

Ford, Honda, Hyundai, and Suzuki have all invested heavily in the Indian market in recent years. If growth remains stagnant or declines, it could lead to retrenchment from manufacturers who previously bet big on the emerging economy. Instead of increased domestic sales, manufacturers may turn to exporting. Ford in particular has spent nearly a billion dollars to expand Indian manufacturing capacity in the anticipation of future growth. The introduction of the EcoSport SUV helped lift overall December sales for Ford India, with a 2.84 percent increase over the previous year. But that sales increase came from a nearly 10 percent decline in domestic sales a 22 percent rise in exports. If Ford’s (or any other company’s) plans for Indian domestic growth don’t pan out, it could lead to all kinds of interesting arrangements in an attempt to maximize sunk capital investments. Indian-built EcoSport for the American market, anyone?

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Toyota Gets $34 Million From Canadian Government To Build Hybrids http://www.thetruthaboutcars.com/2013/01/toyota-gets-34-million-from-canadian-government-to-build-hybrids/ http://www.thetruthaboutcars.com/2013/01/toyota-gets-34-million-from-canadian-government-to-build-hybrids/#comments Thu, 24 Jan 2013 16:09:46 +0000 http://www.thetruthaboutcars.com/?p=474972 Toyota’s Cambridge, Ontario plant will have the honor of being the sole facility outside Japan to produce hybrid Lexus RX crossovers. The announcement came alongside plans for an investment of $34 million investment from the Canadian government. The Ontario government and the Canadian federal government contributed $17 million each to help upgrade the plant and […]

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Toyota’s Cambridge, Ontario plant will have the honor of being the sole facility outside Japan to produce hybrid Lexus RX crossovers. The announcement came alongside plans for an investment of $34 million investment from the Canadian government.

The Ontario government and the Canadian federal government contributed $17 million each to help upgrade the plant and add 400 jobs.  The federal portion comes from Canada’s “Innovation Fund”, a $250 million fund that is being used to provide investment in the auto industry at a time when many auto makers, particularly from the Detroit Three, are complaining about excessive labor costs and a high Canadian dollar to makes it difficult to do business in Canada.

A report by the Windsor Star quotes Tony Faria, an auto industry expert and University professor, as he outlines the challenges faced by Canada in attracting new investment

“It’s not unusual for governments in the southern states to  assemble the land for a plant, provide the land free, provide all of the upgrades in infrastructure to service the plant, provide training funds for the workforce,  tax abatement  for 20, 30 years in future, pay directly for part of the plant’s construction — in other words, cover between 33 and 40 per cent of the entire investment the company would be making in the facility.”

Many observers have been calling for increased government investment in the auto industry, while opponents cry “corporate welfare” over the multi-million dollar sums that flow from the government to the auto makers. Your stance on the matter depends on where you stand on the political spectrum. Those with their feet firmly planted on the ground know that in Ontario, auto manufacturing is a big player, and one of the last sources of good jobs that hasn’t been offshored.

 

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Canadian Government Launches $250 Million Auto “Innovation Fund” http://www.thetruthaboutcars.com/2013/01/canadian-government-launches-250-million-auto-innovation-fund/ http://www.thetruthaboutcars.com/2013/01/canadian-government-launches-250-million-auto-innovation-fund/#comments Fri, 04 Jan 2013 16:56:33 +0000 http://www.thetruthaboutcars.com/?p=472358 The Canadian government will put up $250 million as part of an “auto innovation fund”, a continuation of a 2008 program which the government claims led to over $1 billion in spending. Canadian Prime Minister Stephen Harper will make the announcement today at Ford’s Oakville plant – which happens to be looking for government money […]

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The Canadian government will put up $250 million as part of an “auto innovation fund”, a continuation of a 2008 program which the government claims led to over $1 billion in spending.

Canadian Prime Minister Stephen Harper will make the announcement today at Ford’s Oakville plant – which happens to be looking for government money to help perform upgrades in anticipation of a new model being built at the plant.

The state of Canadian auto manufacturing seems to get bleaker as the days go on; Canada is said to be the most expensive place in the world to build a car, thanks in part to a strong Canadian dollar. The latest round of negotiations with the CAW did little to bring down labor costs, while CAW rank-and-file think the deal gave too many concessions to the auto makers. GM has consistently moved vehicle production out of their first-rate Oshawa assembly plant. In the last decade, only one plant, a Toyota facility, has been built in Canada – though others have been upgraded, no new real investment has been put in place.  Ultimately, the $250 million on offer from the government likely won’t go very far given the needs of the OEMs and their many suppliers. But it’s value as a symbolic gesture make it worth noting.

 

 

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BMW Pulls Ahead With Investors http://www.thetruthaboutcars.com/2012/12/bmw-pulls-ahead-with-investors/ http://www.thetruthaboutcars.com/2012/12/bmw-pulls-ahead-with-investors/#comments Tue, 18 Dec 2012 17:02:45 +0000 http://www.thetruthaboutcars.com/?p=470581 The S-Class Mercedes has been the default choice for the global taste-and-wealth set for a very long time, probably since the demise of the Elwood Engel Continental. The 7-Series BMW, by contrast, has always been a slightly embarrassing purchase, the choice of the man cut out from the classy club by birth, ignorance, or a […]

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The S-Class Mercedes has been the default choice for the global taste-and-wealth set for a very long time, probably since the demise of the Elwood Engel Continental. The 7-Series BMW, by contrast, has always been a slightly embarrassing purchase, the choice of the man cut out from the classy club by birth, ignorance, or a slightly unseemly insistence on driving dynamics. BMW is the striver’s brand, launched into the spotlight by a man who was sort of the Nadia Comaneci of sweaty social climbing. Mercedes is the real thing. Hasn’t it ever been thus?

German investors, on the other hand, seem to like the Roundel.

An article published by Bloomberg late last week seems to suggest that the bloom is off the Daimler-Benz rose, and a large part of that is due to the infamous Dr. Z:

BMW’s market capitalization has surged to 45 billion euros ($58.8 billion), versus 42.2 billion for Daimler. Subtract a reasonable price for Daimler’s truck business — the world’s biggest — and the value investors assign to Mercedes stands at about 25 billion euros.

“The market is saying that the prospects for Mercedes are much worse than for BMW,” said Hans-Peter Wodniok, an analyst with Fairesearch in Kronberg, Germany. “The market’s always right. In terms of innovation, BMW is the leader.”

“The market’s confidence in Daimler management is pretty much at rock bottom,” said Max Warburton, a Bernstein analyst in Singapore. “Investors have little or no confidence that current management will be able to do what is necessary to close the gap to BMW.”

One would think that the time to have lost confidence in Daimler management would have been a decade ago, when the product was iffy at best and even the mighty S-Class was often seen driving around with a dead COMAND screen and a droopy air suspension. Sometimes perception lags reality. Not to worry, though: investors may be bearish on the three-pointed star but there’s redemption ahead.

the potential of the Mercedes brand in China is “ overwhelming,” said Yale Zhang, managing director of consultancy Automotive Foresight in Shanghai. “Every consumer understands the value of Mercedes and the logo.

While the S-Class no doubt reigns supreme in China as elsewhere, the relatively lackluster star quality of the C-Class probably has customers there wondering if they really wouldn’t rather have a Buick.

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BMW Revs Up Spartanburg To The Tune Of $900 Million http://www.thetruthaboutcars.com/2012/01/bmw-revs-up-spartanburg-to-the-tune-of-600-million/ http://www.thetruthaboutcars.com/2012/01/bmw-revs-up-spartanburg-to-the-tune-of-600-million/#comments Thu, 12 Jan 2012 16:57:28 +0000 http://www.thetruthaboutcars.com/?p=425851 Bucolic Spartanburg, SC, will get a new boost when BMW drops $900 million on the plant to expand its capacity to 350,000 units per year. Spartanburg will become one of the world’s largest BMW plants. The BMW Group already invested USD 750 million in the expansion of the plant for production of the new BMW […]

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Bucolic Spartanburg, SC, will get a new boost when BMW drops $900 million on the plant to expand its capacity to 350,000 units per year. Spartanburg will become one of the world’s largest BMW plants. The BMW Group already invested USD 750 million in the expansion of the plant for production of the new BMW X3 between 2008 and 2010. Now, the plant is being expanded again to make room for the X4.

Last year, the BMW plant in Spartanburg produced 276,065 vehicles for more than 130 markets around the world,  an increase of 73 percent over the previous year.

Much to the delight of SC governor Nikki Haley, BMW’s total investment in South Carolina will grow to approximately $6 billion.

Little known factoid: More than 70 percent of the vehicles produced in Spartanburg (192,813) were exported, making the BMW Group the largest automotive exporter to the non-NAFTA countries.

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Chrysler Workers Smoke Pot, Drink Beer At Lunch And Don’t Give A Freckle About Quality http://www.thetruthaboutcars.com/2010/11/372660/ http://www.thetruthaboutcars.com/2010/11/372660/#comments Sun, 14 Nov 2010 08:47:42 +0000 http://www.thetruthaboutcars.com/?p=372660 Some say, TTAC has an anti-Detroit, pro-import slant. We won’t comment on that, you mommy-fraternizing liars. All we can say is: If you harbor these notions, don’t move to Oklahoma. Oklahoma’s largest newspaper, the Oklahoman, dishes out more anti-Detroit snark in a single serving than even a Farago could have cooked-up in his TTAC lifetime. […]

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Some say, TTAC has an anti-Detroit, pro-import slant. We won’t comment on that, you mommy-fraternizing liars. All we can say is: If you harbor these notions, don’t move to Oklahoma. Oklahoma’s largest newspaper, the Oklahoman, dishes out more anti-Detroit snark in a single serving than even a Farago could have cooked-up in his TTAC lifetime. How about calling the former owners of Chrysler unqualified “idiots?” And not the former owners you think of now. Wait, there is worse.

The Oklahoman runs a Dear Abby style investment column, where readers can come to a Malcolm Berko for advice. An F.M., hailing from Troy, Mich, did so. (Why someone from Troy would turn to Oklahoma City’s hometown paper for investment advice is beyond me, but I digress.) F.M. didn’t agree with Berko’s prior opinion that buying GM stock amounts to throwing money away. He (or she) wanted to know whether Chrysler would be a good investment, should it ever go public.

Boy, did F.M. receive an earful of investment advice!

“Dear F.M.: No matter how much perfume you splash on a pig, a pig will always be a pig. The Chrysler culture could never function under Daimler’s superb management, could never emulate Daimler’s skilled work force and could never produce a Daimler-quality product. That’s not how the American automobile industry comports itself.”

“And 10 years later in predictable disgust, Daimler sold 80 percent of Chrysler to Cerberus Capital Management in 2007. And the Cerberus idiots hired Robert “Nasty” Nardelli, who couldn’t make it at GE or Home Depot, to run the company.”

What, no requisite jab at the “merger of equals?” No accusation that vestal & virtuous Chrysler had been raped by Teutonic terrorists who then pillaged her dowry and made off with the cash? Nope. No double quotes around “superb management” either. Now what about an investment into a possible Chrysler share? Over to you, Malcolm:

“One must be mad as a hatter to consider owning a single share of this issue (same for the General Motors issue when it comes public again) because good old new Chrysler won’t have changed enough from good old, old Chrysler.”

“Good old new Chrysler will have the same good old, old workers who still smoke pot and drink beer at lunch and don’t give a freckle about quality. Good old new Chrysler will still be held hostage to the United Auto Workers’ self-serving workplace rules and financial shenanigans. And good old new Chrysler will still be managed by the same corrupt culture of fools who drove the good, old, old Chrysler into bankruptcy.”

“The only profits in this IPO will be made by the Wall Street lawyers, CPAs, advisers and brokerage firms who take this public. And considering our high unemployment numbers and lower consumer incomes, I doubt that Chrysler can sell enough vehicles to produce a profit.”

The deathwatch series continues. In Oklahoma.

P.S.: Turns out this is not an Oklahoman phenomenon. Berko is syndicated all over the place. We need to get more aggressive. Or else the supposedly staid MSM will win the snark war.

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Fiat Invests Big To Stay Big In Brazil http://www.thetruthaboutcars.com/2010/10/fiat-invests-big-to-stay-bigin-brazil/ http://www.thetruthaboutcars.com/2010/10/fiat-invests-big-to-stay-bigin-brazil/#comments Thu, 21 Oct 2010 14:39:12 +0000 http://www.thetruthaboutcars.com/?p=369658 GM is the market leader in the United States. Volkswagen has Europe. Toyota has Australia and Japan. Fiat has…. Brazil? That’s right. Fiat is the number one in Brazil. Brazilians do love a good Fiat. But with Volkswagen’s global ambitions, that number one position in Brazil isn’t safe for Fiat. Volkswagen is number 2 there and […]

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GM is the market leader in the United States. Volkswagen has Europe. Toyota has Australia and Japan. Fiat has…. Brazil? That’s right. Fiat is the number one in Brazil. Brazilians do love a good Fiat. But with Volkswagen’s global ambitions, that number one position in Brazil isn’t safe for Fiat. Volkswagen is number 2 there and if it one thing Volkswagen doesn’t like, it’s playing second fiddle. This is why Fiat is going on the offensive.

MoneyControl.com reports that Fiat Brazil is going to invest 10 billion Brazilian reais (that’s about $6b to you) in Brazilian operations over the next 5 years. That’s a lot of cheddar! 70 percent of that money will go to the car division. They’ll need that money as Fiat Brazil is going to unleash 20 new models and refreshes next year according to executives. Later on in the year, Fiat Brazil will give more details on what this massive investment will fund. But one thing is for sure. Fiat’s Brazilian operations need that money. Their factory in Minas Gerais is running at near peak of 800,000 vehicles a year. Last year it manufactured 729,000 vehicles. And that production shows no sign of slowing down as car demand is still high, even though the Brazilian government withdrew tax incentives for car purchases. Fiat will also triple production at its Argentinian factory in Cordoba for two years, just to keep up with Brazilian demand. Wow. Suddenly 10 billion reais doesn’t sound like enough!

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Toyota Plants Big R&D Center in Shanghai http://www.thetruthaboutcars.com/2009/11/toyota-puts-big-rd-center-into-shanghai/ http://www.thetruthaboutcars.com/2009/11/toyota-puts-big-rd-center-into-shanghai/#comments Mon, 09 Nov 2009 21:43:20 +0000 http://www.thetruthaboutcars.com/toyota-puts-big-rd-center-into-shanghai/ Intellectual property warriors, get your guns: Following GM, its arch nemesis Toyota will plant a brand new R & D center smack into the alleged intellectual property jungle called China. Toyota plans to spend between $330 and $440 million for the center. Building will commence next year. Compared to Toyota, the one GM built in […]

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Intellectual property warriors, get your guns: Following GM, its arch nemesis Toyota will plant a brand new R & D center smack into the alleged intellectual property jungle called China. Toyota plans to spend between $330 and $440 million for the center. Building will commence next year. Compared to Toyota, the one GM built in 2008 was the lite version at a price of only $250 million.

The Toyota R&D center, complete with a full-scale test course, will be located not far from the GM center, in the outskirts of Shanghai, Gasgoo reports.

Toyota has four joint ventures in China and holds about 6 percent of the world’s largest auto market. Officially, Toyota’s center is being moved to China to better meet local demand. Unofficially, it is most likely there to save on R&D costs. Shanghai University’s highly regarded Automotive College in Anting is cranking out very capable engineers by the boatload, ready and willing to work at much lower wages than an engineer in Aichi, Detroit, or Wolfsburg.

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