The Big Three sent letters to the Canadian Auto Workers union Wednesday, asking them to forgo a small wage increase as a means of keeping Canadian plants competitive.

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Stefan Jacoby, CEO of bought-by-Geely Volvo needs to bring down the cost of Volvo’s European-made cars.

So where will the new Volvo factories be? You have two tries.

China? Check. Volvo might actually open three factories in China, Stefan Jacoby said recently in Stockholm. Details should be forthcoming within the next weeks.

Ok, now for another country … (Read More…)

When Geely bought Volvo from Ford, the feel-good story was that production will remain ind Sweden, with maybe another Chinese factory for Chinese consumption.  So much for that. Geely may build three Volvo plants in China, a Geely spokesman told Reuters today. (Read More…)

Toyota’s capacity utilization at U.S. plants dropped to 60 percent in the second half of 2008 after the economic crisis hit the U.S.  Enough of this.  Utilization is  up to 90 percent already. Next year, Toyota plans to run its N.A. factories at full tilt. More than that: Workers will be doing overtime, work weekend and holiday shifts, says The Nikkei [sub].

Of course, the fact that NUMMI is off-line could also have something to do with it.

The German paper Rheinische Post runs an interesting op-ed piece today. Headlined: “Opel fights its demise,” the article concludes that Opel most likely won’t make it:

Opel CEO Nick Reilly is facing a dilemma. Even before the outbreak of the economic crisis, Opel was confronted with an overcapacity of 20 percent. The Abwrackprämie being behind us, sales will crater. This creates extra pressure to eliminate more jobs. If Reilly implements his restructuring program, then he will have to fight the opposition of the workers. For once, it is easy to put a number to this: €265m a year. The workers wanted to forgo this sum – if Reilly won’t shut down any plants. Now Reilly is €265m short – and has to cut more jobs. At that point, the governments, on who’s support Reilly counts, will call it quits. Whether Opel is kept alive with tax money, with funds from the parent, or with money from the workforce: an artificial respiration of a company is ultimately more expensive than anticipated. And it is almost never successful.

Toyota had slammed hard on the brake when it came to capital expenditures. So hard that ToMoCo (and Sony) were rapped on the knuckles by the Japanese Ministry of Finance for hobbling Japan’s economy. Suddenly, Toyota starts pouring concrete and installing machinery again. Not because of newfound faith in the auto market in general. Two factors made them do it: The Yen has become so expensive that manufacturing in the USA is cheaper. And China is gobbling up cars faster than Toyota can make them.

According to the Nikkei [sub], a Toyota plant in the US and one in China will increase ToMoCo’s annual output capacity by 200,000 units before the Japanese 2010 fiscal ends on March 31, 2001. The construction will cost Toyota a little over $1b, depending on the vagaries of the greenback and its pegged follower, the Chinese Yuan. Here are the blueprints:
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