The Truth About Cars » united states http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Fri, 27 Mar 2015 17:45:08 +0000 en-US hourly 1 http://wordpress.org/?v=4.0.1 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 editors@ttac.com editors@ttac.com (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 » united states http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Reithofer: Government Programs Key To BMW i3 Success http://www.thetruthaboutcars.com/2015/03/reithofer-government-programs-key-bmw-i3-success/ http://www.thetruthaboutcars.com/2015/03/reithofer-government-programs-key-bmw-i3-success/#comments Wed, 25 Mar 2015 11:00:26 +0000 http://www.thetruthaboutcars.com/?p=1028841 BMW’s i3’s success is helped by a number of government incentives in a few of the automaker’s key markets, according to CEO Norbert Reithofer. According to Automotive News Europe, Reithofer said that sales figures for the i3 are connected to political initiatives toward electric mobility, adding that when those initiatives are there, “the registration figures […]

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2015 BMW i3 Range Extender Exterior-007

BMW’s i3’s success is helped by a number of government incentives in a few of the automaker’s key markets, according to CEO Norbert Reithofer.

According to Automotive News Europe, Reithofer said that sales figures for the i3 are connected to political initiatives toward electric mobility, adding that when those initiatives are there, “the registration figures for the BMW i3 soar.”

The CEO cited Norway as an example, where the government not only has a charging infrastructure where owners can park and recharge for free, but does not levy sales or registration taxes on EVs. Those incentives have helped BMW move 2,000 i3s in 2014.

Meanwhile, significant financial subsidies in the United States, as well as privileges such as use of dedicated HOV lanes, led to sales of 3,000 units in California alone, a figure that is half of all i3s sold in the U.S.

Other incentives include looser licensing restrictions in Shanghai, circulation tax exemptions for 10 years from date of first registration in Germany, and company car tax exemptions for life in France.

Speaking of Germany, where 2,000 i3s were sold in 2014, Reithofer said his country’s government needs to “pick up the pace” in pushing electric mobility. Germany wants 1 million EVs on its roads by 2020, and has plans to offer additional incentives to achieve its goal.

In the meantime, BMW will introduce its DriveNow car-sharing service this spring, beginning in London. San Francisco will be the first U.S. city in the program by May, while the German cities of Hamburg, Berlin and Munich will join in July. The program is meant to help boost acceptance of electrification, and widening the tech’s appeal among younger drivers.

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Study: Mercedes Holds Highest Average Labor Costs Among US Manufacturers http://www.thetruthaboutcars.com/2015/03/study-mercedes-holds-highest-average-labor-costs-among-us-manufacturers/ http://www.thetruthaboutcars.com/2015/03/study-mercedes-holds-highest-average-labor-costs-among-us-manufacturers/#comments Wed, 25 Mar 2015 10:00:48 +0000 http://www.thetruthaboutcars.com/?p=1028817 Who among all automakers has the highest labor costs in the United States? A study points to Mercedes-Benz. According to Reuters, a study of 2014 labor costs by the Center for Automotive Research found that the automaker’s sole U.S. plant in Vance, Ala. averages $65/hour, while Volkswagen and BMW held the lowest averages overall and […]

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Who among all automakers has the highest labor costs in the United States? A study points to Mercedes-Benz.

According to Reuters, a study of 2014 labor costs by the Center for Automotive Research found that the automaker’s sole U.S. plant in Vance, Ala. averages $65/hour, while Volkswagen and BMW held the lowest averages overall and among the transplants, coming out to $38 and $39 per hour, respectively.

As mentioned previously, General Motors and Ford have the highest costs among the Detroit Three, averaging $58 and $57 per hour compared to FCA US’ $48. The three automakers are also the only ones whose employees are represented by the United Auto Workers, whose 2007 contract created the two-tier wage system meant to help the trio remain competitive against the transplants, as well as to stay afloat during the darkest days of the Great Recession.

Other automakers with business in the U.S. include Honda ($49/hr.), Toyota ($48/hr.), Nissan ($42/hr.), and Hyundai/Kia ($41/hr.).

The averages in the study were based on pay for both direct-hire and temporary employees working full-time. The research group also found that Japanese transplants had the highest percentages of temporary employees, helping to cut down on labor costs.

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Takata Recall Sees More Rapid Response In Japan Than US http://www.thetruthaboutcars.com/2015/03/takata-recall-sees-rapid-response-japan-us/ http://www.thetruthaboutcars.com/2015/03/takata-recall-sees-rapid-response-japan-us/#comments Mon, 23 Mar 2015 11:00:29 +0000 http://www.thetruthaboutcars.com/?p=1027417 While consumers, dealers and automakers in the United States are waiting for replacement airbags from Takata, recalls in Japan are being fulfilled faster. Automotive News reports out of 3.05 million vehicles under recall in the supplier’s home market due to its airbags — linked to five fatalities and several injuries as a result of catastrophic […]

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Takata information steering wheel + airbag combo

While consumers, dealers and automakers in the United States are waiting for replacement airbags from Takata, recalls in Japan are being fulfilled faster.

Automotive News reports out of 3.05 million vehicles under recall in the supplier’s home market due to its airbags — linked to five fatalities and several injuries as a result of catastrophic failure — 2.13 million — 70 percent — have been repaired through the end of February 2015.

Meanwhile, out of the 17 million vehicles in the U.S. under recall for the same issue, less than 2 million — 12 percent — were repaired through late February.

The stark differences between the two countries are the result of how Japan’s authorities and consumers deal with recalls compared to those in the U.S. In the former, consumers respond well to recalls, and few keep vehicles for as long as those in the latter do. Further, tighter safety and emission inspections not only help keep vehicle records up to date, but can serve to warn consumers of potential problems. Finally, the used car market isn’t as robust as it is in the U.S., making it easier for automakers to contact owners in case of a recall, as cars don’t change owners as often.

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UMTRI: US New-Car Fuel Economy Averaged 25.3 MPG In 2014 http://www.thetruthaboutcars.com/2015/02/umtri-us-new-car-fuel-economy-averaged-25-3-mpg-2014/ http://www.thetruthaboutcars.com/2015/02/umtri-us-new-car-fuel-economy-averaged-25-3-mpg-2014/#comments Tue, 24 Feb 2015 14:00:21 +0000 http://www.thetruthaboutcars.com/?p=1006746 The final numbers are in for new-car fuel economy in the United States for 2014, and they are better than they were in 2008. According to Autoblog, the University of Michigan Transportation Research Institute found that the average U.S. fuel economy for a 2014 model landed at 25.3 mpg, 22 percent higher than six years […]

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The final numbers are in for new-car fuel economy in the United States for 2014, and they are better than they were in 2008.

According to Autoblog, the University of Michigan Transportation Research Institute found that the average U.S. fuel economy for a 2014 model landed at 25.3 mpg, 22 percent higher than six years ago.

The same percentage of improvement holds up when it comes to vehicles rated at 16 mpg or less, where only one in 30 new cars held that distinction. On the other end of the spectrum, one in six new cars garnered a rating of 32 mpg or above in 2014; only 1 percent could say the same in 2008.

UMTRI 2008 - 2014 US New-Car Fuel Economy Comparison Chart

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Hyundai Bolstering Commercial Business For Go At US Market http://www.thetruthaboutcars.com/2015/02/hyundai-bolstering-commercial-business-go-us-market/ http://www.thetruthaboutcars.com/2015/02/hyundai-bolstering-commercial-business-go-us-market/#comments Tue, 17 Feb 2015 12:00:06 +0000 http://www.thetruthaboutcars.com/?p=1002794 Hyundai is preparing to enter the U.S. commercial vehicle market through an investment plan to strengthen its current commercial business by 2020. Reuters reports the automaker will invest ₩400 billion ($363.13 million USD) to boost production of its commercial vans, trucks and buses at home by the start of the next decade, with an additional […]

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Hyundai Trago Xcient

Hyundai is preparing to enter the U.S. commercial vehicle market through an investment plan to strengthen its current commercial business by 2020.

Reuters reports the automaker will invest ₩400 billion ($363.13 million USD) to boost production of its commercial vans, trucks and buses at home by the start of the next decade, with an additional ₩1.6 trillion ($1.45 billion) to go into R&D over the same period.

Currently, Hyundai is building its Trago Xcient heavy commercial truck in China for the automaker’s largest market — the U.S. is second — and has plans to assemble the H350 light commercial truck in Turkey beginning next month for the automaker’s foray into Western Europe. Meanwhile, the factory in Jeonji, South Korea will see its production capacity rise from 65,000 units per year to 100,000 by 2020.

However, just like its experience in building its market share in the U.S. consumer market, Hyundai’s assault on the commercial market will take some time. Per Korea Investment & Securities analyst Suh Sung-moon, the automaker would need to boost total commercial production capacity to 10 million units, up from the 8 million made annually.

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Middle Eastern, Asian Demand Fuels Booming US Auto Exports http://www.thetruthaboutcars.com/2015/02/middle-eastern-asian-demand-fuels-booming-us-auto-exports/ http://www.thetruthaboutcars.com/2015/02/middle-eastern-asian-demand-fuels-booming-us-auto-exports/#comments Tue, 10 Feb 2015 15:00:26 +0000 http://www.thetruthaboutcars.com/?p=995394 Demand from the Middle East and Asia has helped fuel a new record in U.S. auto exports for the third consecutive year. The Wall Street Journal reports 2.1 million vehicles from factories in the Midwestern and Southeastern United States left for export markets in 2014, breaking the 2-million barrier for the first time. The figure […]

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Jeep Cherokees Departing West From Grays Harbor Washington

Demand from the Middle East and Asia has helped fuel a new record in U.S. auto exports for the third consecutive year.

The Wall Street Journal reports 2.1 million vehicles from factories in the Midwestern and Southeastern United States left for export markets in 2014, breaking the 2-million barrier for the first time. The figure is an 8 percent increase over 2013, and a 73 percent jump from a decade ago.

While around half of the exports head north to Canada or south to Mexico, China, Saudi Arabia and South Korea welcomed U.S.-made BMWs, Jeeps, Toyotas et al to their ports over the past year.

Factors for the booming export market include a dollar that was weak long enough to lay down the foundation, and is now strong enough against the yen and euro to encourage more production in the U.S., leaner manufacturing, competitive labor rates, and the aforementioned increased demand from newer markets in the Middle East and Asia.

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US Ethanol Exports Reach Near-Record Levels In 2014 http://www.thetruthaboutcars.com/2015/02/us-ethanol-exports-reach-near-record-levels-2014/ http://www.thetruthaboutcars.com/2015/02/us-ethanol-exports-reach-near-record-levels-2014/#comments Mon, 09 Feb 2015 14:00:30 +0000 http://www.thetruthaboutcars.com/?p=994874 Of the 14.3 billion gallons of ethanol produced in the United States in 2014, a near-record 836 gallons were exported. Per a report by the Renewable Fuel Association, those exported gallons went to 51 countries around the world, with the top five importers being Canada, Brazil, United Arab Emirates, Philippines and India. The amount of […]

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2008 Chevrolet Corvette E85 Indy 500 Pace Car Concept

Of the 14.3 billion gallons of ethanol produced in the United States in 2014, a near-record 836 gallons were exported.

Per a report by the Renewable Fuel Association, those exported gallons went to 51 countries around the world, with the top five importers being Canada, Brazil, United Arab Emirates, Philippines and India. The amount of U.S.-made ethanol exported in 2014 comes second to the amount in 2011, when 1.2 billion gallons were sent abroad.

While most export markets continue to flourish, producers saw a continued reduction of exports to the European Union in 2013 and 2014, the result of tariffs against U.S. ethanol.

On the other side, ethanol imports into the U.S. market fell 79 percent in 2014 from 400 million gallons to just 84 million. The figure is the second-lowest on record, behind the 18 million gallons imported in 2010. The majority of the imported ethanol was Brazil, which sent 60.8 million gallons to the U.S. last year, down 83 percent from 2013’s shipment of 348.2 million.

The industry group hopes to add more markets for U.S. ethanol in 2015, having gone on trade missions in Panama, China, Peru, Japan and South Korea in 2014 to help encourage importation, and vowing to “keep at it until all countries understand the value of U.S produced ethanol.”

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Study: US Better Off Funding EV Charging Infrastructure Over Tax Incentives http://www.thetruthaboutcars.com/2015/02/study-us-better-off-funding-ev-charging-infrastructure-tax-incentives/ http://www.thetruthaboutcars.com/2015/02/study-us-better-off-funding-ev-charging-infrastructure-tax-incentives/#comments Thu, 05 Feb 2015 14:00:22 +0000 http://www.thetruthaboutcars.com/?p=994010 According to a new study, federal funding of EV charging infrastructure would do more to increase EV adoption rates than what tax credits do now. The National Science Foundation discovered that the total amount of credits dispersed between 2011 and 2013 came out to $1.05 billion, enough to build over 60,000 charging stations had the […]

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Tesla Supercharger Night Party

According to a new study, federal funding of EV charging infrastructure would do more to increase EV adoption rates than what tax credits do now.

The National Science Foundation discovered that the total amount of credits dispersed between 2011 and 2013 came out to $1.05 billion, enough to build over 60,000 charging stations had the subsidies gone towards such things; the figure is equal to half of all gas stations in the United States. In turn, an additional 60,000 stations would boost adoption rates to five times the current rate.

Another part of the study focused how EV and PHEV owners charged their vehicles, looking at ways to bring low-cost, more efficient charging to the home. Most owners use a standard 120-volt outlet for overnight charging, while direct-current charging boosts recharge rates four to six times above alternating-current charging, but at a cost of $15,000 to $25,000 for the equipment.

As for outside of the home, the NSF developed an intelligent charging system that would optimize charging costs at malls or parking garages, while managing the charging itself to reduce strain on the electric grid.

The study comes as the U.S. will likely fall short of the 1-million EV goal set by President Barack Obama for the end of 2015; just over 250,000 EVs have been sold in the U.S. since 2010.

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IIHS: US Driver Fatalities Fall One-Third In Three Years http://www.thetruthaboutcars.com/2015/01/iihs-us-driver-fatalities-fall-one-third-three-years/ http://www.thetruthaboutcars.com/2015/01/iihs-us-driver-fatalities-fall-one-third-three-years/#comments Fri, 30 Jan 2015 15:00:01 +0000 http://www.thetruthaboutcars.com/?p=991274 Per a report by the Insurance Institute for Highway Safety, driver fatalities in the United States have fallen by a third over the past three years. Automotive News says the report’s findings come after the seemingly endless recall parade of 2014, which saw 60.5 million vehicles in the U.S. brought in for repair work, an […]

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Per a report by the Insurance Institute for Highway Safety, driver fatalities in the United States have fallen by a third over the past three years.

Automotive News says the report’s findings come after the seemingly endless recall parade of 2014, which saw 60.5 million vehicles in the U.S. brought in for repair work, an all-time industry record.

The IIHS added that nine vehicles made in 2011 or earlier had no fatalities recorded between 2009 and 2012: Audi A4 4WD, Honda Odyssey, Kia Sorento 2WD, Lexus RX 350 4WD, Mercedes-Benz GL-class 4WD, Subaru Legacy 4WD, Toyota Highlander hybrid 4WD, Toyota Sequoia 4WD and Volvo XC90 4WD. The list marks an improvement in safety according to the non-profit group, when only eight years ago, “there were no models with driver death rates of zero.”

However, while most of the vehicles with zero fatalities are SUVs and crossovers, most of the vehicles with the highest number of deaths over the same period are compacts like the Hyundai Accent, Nissan Versa and Kia Rio. The report confirms this, proclaiming that “with some exceptions, death rates tend to go down as size goes up.” This is a change from a decade earlier, when SUVs and crossovers had higher numbers of deaths due to a lack of stability controls and other systems meant to prevent roll-over.

As far as total elimination of traffic fatalities in the U.S. goes, IIHS executive vice president and chief research officer David Zuby says such a thing is decades away, and would require not only continued improvements in vehicle safety, but changes in road construction and public safety policy, as well. The report adds that the Great Recession helped to contribute toward the decline in deaths, warning that as the economy continues its recovery, and without said policy changes, the decline could reverse.

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German Automakers Rally In Support of US-EU Trade Agreement http://www.thetruthaboutcars.com/2015/01/german-automakers-rally-support-us-eu-trade-agreement/ http://www.thetruthaboutcars.com/2015/01/german-automakers-rally-support-us-eu-trade-agreement/#comments Wed, 28 Jan 2015 15:00:17 +0000 http://www.thetruthaboutcars.com/?p=989578 Leaders from Germany’s automotive sector held a rally Wednesday in Berlin to lend support to a transatlantic trade agreement heavily facing opposition. Automotive News reports the agreement between the European Union and the United States, which is supported by the likes of Daimler AG’s Dieter Zetsche, Volkswagen AG’s Martin Winterkorn, and even Germany’s chancellor Angela […]

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Leaders from Germany’s automotive sector held a rally Wednesday in Berlin to lend support to a transatlantic trade agreement heavily facing opposition.

Automotive News reports the agreement between the European Union and the United States, which is supported by the likes of Daimler AG’s Dieter Zetsche, Volkswagen AG’s Martin Winterkorn, and even Germany’s chancellor Angela Merkel, would be the largest such agreement put into play when signed. The deal would deliver a gain of €119 billion ($135 billion USD) for the EU and $131 billion for the U.S. by 2027, which equals an average of €545 ($620) and $910 for a family of four in their respective locations. Eighty percent of the gains would be the result of eliminating duplication costs linked to maintenance of two different bureaucracies and regulations.

However, German union IG Metall and various consumer groups take issue with key parts of the agreement, if not the entire agreement itself. For the union, the investor-to-state dispute settlement mechanism — which grants corporations the right to sue the government if revenue is lost due to government policy — is unacceptable, as are the threats of softening environmental and consumer protections, and hollowed workers’ rights. Other groups fear U.S. companies could force European legislators to draft policies in the former’s favor, and “harmonize safety or product standards downward.”

As for why the German automakers are rallying, the aforementioned harmonization would allow all automakers to focus on one set of safety and emission standards, thus allowing for the possibility of buying a new car from a different market without waiting 25 years first. That said, the agreement could collapse without majority support from all 28 members of the European Parliament.

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Marijuana Legalization Prompting Examination Of Impaired-Driving Laws http://www.thetruthaboutcars.com/2014/12/marijuana-legalization-prompting-examination-impaired-driving-laws/ http://www.thetruthaboutcars.com/2014/12/marijuana-legalization-prompting-examination-impaired-driving-laws/#comments Tue, 30 Dec 2014 13:00:48 +0000 http://www.thetruthaboutcars.com/?p=969889 How much marijuana is too much before getting the wheel? No one seems to know for sure despite the overwhelming support for related impaired-driving laws. According to The Detroit Bureau, the AAA Foundation for Traffic Safety found 85 percent of Americans are in support of marijuana-impairment legislation, but the definition itself is up in smoke. […]

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Cheech & Chong

How much marijuana is too much before getting the wheel? No one seems to know for sure despite the overwhelming support for related impaired-driving laws.

According to The Detroit Bureau, the AAA Foundation for Traffic Safety found 85 percent of Americans are in support of marijuana-impairment legislation, but the definition itself is up in smoke. President and CEO Peter Kissinger explained that 16 states “forbid any presence of prohibited drugs, while five others have specific limits for marijuana.”

Other consistency issues go beyond just the amount in one’s bloodstream, such as when one would be fine to drive, and the low concern for drug-impaired driving compared to alcohol’s own effects, with only 50 percent feeling a “very serious” threat from Jeff Spicoli & Co.

Prescription drugs were found to be less a threat to other drivers than marijuana et al, where only 25 percent found usage of cold medications, certain antidepressants and medical marijuana a major threat on the highway.

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Daimler Expanding Sprinter Production To North America http://www.thetruthaboutcars.com/2014/10/daimler-expanding-sprinter-production-north-america/ http://www.thetruthaboutcars.com/2014/10/daimler-expanding-sprinter-production-north-america/#comments Wed, 22 Oct 2014 13:00:49 +0000 http://www.thetruthaboutcars.com/?p=934770 When Daimler begins production of its next-gen Sprinter, quite a few of the vans will be leaving an assembly line somewhere in North America. Automotive News reports the partial shift in production will help the automaker “cover the growing demand for large vans in the North American market economically” by producing them locally “in the […]

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When Daimler begins production of its next-gen Sprinter, quite a few of the vans will be leaving an assembly line somewhere in North America.

Automotive News reports the partial shift in production will help the automaker “cover the growing demand for large vans in the North American market economically” by producing them locally “in the NAFTA region,” according to Mercedes’ head of vans, Volker Mornhinweg.

Presently, the U.S.-bound Sprinters are made in Dusseldorf and Ludwigsfelde, Germany, then sent over in CKD form to Ladson, S.C. for reassembly. Around 23,000 Sprinters were sent in this manner to U.S. customers in 2013, the sales second only to Germany.

As for where the new plant will be built, Mornhinweg says the exact location would be chosen in the coming months, with sites in the U.S., Canada and Mexico being examined.

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Saudis Accept Lower Barrel Prices In Fight Against US Production http://www.thetruthaboutcars.com/2014/10/saudis-accept-lower-barrel-prices-fight-us-production/ http://www.thetruthaboutcars.com/2014/10/saudis-accept-lower-barrel-prices-fight-us-production/#comments Wed, 15 Oct 2014 12:00:46 +0000 http://www.thetruthaboutcars.com/?p=931394 While some OPEC nations are panicking over oil prices not being above $100/barrel, Saudi Arabia says it wouldn’t mind accepting barrels worth $90 or $80 for the next year or two, so long as it slows down production elsewhere. Reuters reports the nation is playing the short-term, low-profit game for medium-term gains, with the long-term […]

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Rock the Casbah

While some OPEC nations are panicking over oil prices not being above $100/barrel, Saudi Arabia says it wouldn’t mind accepting barrels worth $90 or $80 for the next year or two, so long as it slows down production elsewhere.

Reuters reports the nation is playing the short-term, low-profit game for medium-term gains, with the long-term goal of retaining its market share for years to come in mind. The move would affect other OPEC members financially, forcing reductions throughout the industry.

In particular, lower barrel prices would put a dent in North American petroleum production, from the oil sands in Alberta and the Bakken Formation in North Dakota, to deep-sea reserves in the Gulf of Mexico.

Whatever cuts do occur, they would likely happen after the group’s meeting November 27, which may prove contentious as most members would rather raise the price than reduce production. That said, the Saudis have already cut prices for its Asian customers earlier this month, a sign of price wars to come.

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Looming Retaliatory Sanctions Threaten Western Automakers In Russia http://www.thetruthaboutcars.com/2014/08/looming-retaliatory-sanctions-threaten-western-automakers-russia/ http://www.thetruthaboutcars.com/2014/08/looming-retaliatory-sanctions-threaten-western-automakers-russia/#comments Tue, 19 Aug 2014 12:00:55 +0000 http://www.thetruthaboutcars.com/?p=895362 Automotive exports from European and American manufacturers may suffer sanctions by Russia in retaliation for more sanctions imposed upon by the European Union and the United States. Reuters reports the financial damaged suffered by potential sanctions would vary, with automakers like Mercedes-Benz suffering the most thanks to a lack of local factories in Russia. The […]

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Mercedes-Benz; H2 World Drive 2011; Europe 2

Automotive exports from European and American manufacturers may suffer sanctions by Russia in retaliation for more sanctions imposed upon by the European Union and the United States.

Reuters reports the financial damaged suffered by potential sanctions would vary, with automakers like Mercedes-Benz suffering the most thanks to a lack of local factories in Russia. The move would be in addition to an import ban on food, and was on the table before President Vladimir Putin rejected the proposal.

The automotive ban would give Chinese and Korean manufacturers a chance to make their mark upon a muted market. Western imports made up 27 percent of passenger vehicle sales in 2014 thus far, while trucks and buses took 46 percent and 13 percent of the market.

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US-Korea Free Trade Agreement Results Darken Trans-Pacific Partnership http://www.thetruthaboutcars.com/2014/08/us-korea-free-trade-agreement-results-darken-trans-pacific-partnership/ http://www.thetruthaboutcars.com/2014/08/us-korea-free-trade-agreement-results-darken-trans-pacific-partnership/#comments Mon, 04 Aug 2014 12:00:46 +0000 http://www.thetruthaboutcars.com/?p=881026 Two years after the Obama administration heralded its free trade deal between the United States and South Korea, the latter’s market remains relatively closed to the former’s exports. The Detroit News reports U.S. Senator Debbie Stabenow of Michigan, chairing her first Finance Committee subcommittee on international trade, proclaimed the free trade agreement fell short of […]

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Ford Korea

Two years after the Obama administration heralded its free trade deal between the United States and South Korea, the latter’s market remains relatively closed to the former’s exports.

The Detroit News reports U.S. Senator Debbie Stabenow of Michigan, chairing her first Finance Committee subcommittee on international trade, proclaimed the free trade agreement fell short of expectations, noting the increasing deficit between the U.S. and South Korea by 50 percent in favor of the latter party, especially regarding automotive exports:

The agreement aimed to open Korea’s markets to American automakers. But agreeing to phase-out tariffs on U.S.-made automobiles hasn’t been enough. Due to non-tariff barriers, Korea remains one of the most closed auto markets in the world.

Ford vice president for international government relations Steve Biegun, also in attendance, said his employer will sell just 7,000 units in South Korea this year after 20 years of attempts to boost sales. Biegun said access to the Korean auto market remains a challenge, citing regulatory challenges.

This comes on the heels of the Trans-Pacific Partnership, which seeks to do with Japan, the United States and 10 other nations what the U.S. had sought with South Korea. Biegun, CEO Mark Fields and Chairman Bill Ford Jr. warn the deal needs increased measures to hinder Japan’s ability to influence the value of the yen, while Stabenow adds there are “outstanding disputes” on agriculture and automobiles along other “very sticky issues” between all parties involved, especially Japan.

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Exporters Caught In Crossfire Over US Auto Exports To Chinese Customers http://www.thetruthaboutcars.com/2014/07/exporters-caught-in-crossfire-over-us-auto-exports-to-chinese-customers/ http://www.thetruthaboutcars.com/2014/07/exporters-caught-in-crossfire-over-us-auto-exports-to-chinese-customers/#comments Tue, 22 Jul 2014 13:00:20 +0000 http://www.thetruthaboutcars.com/?p=871418 Though most automakers prohibit sales of their wares to exporters, and though the government can sometimes block an export despite such exportation being legal, exporters in the United States are finding themselves in the crossfire over premium vehicle exports to Chinese consumers who prefer to pay lower U.S. prices over higher local prices. Automotive News […]

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2015-BMW-X4-06-550x366

Though most automakers prohibit sales of their wares to exporters, and though the government can sometimes block an export despite such exportation being legal, exporters in the United States are finding themselves in the crossfire over premium vehicle exports to Chinese consumers who prefer to pay lower U.S. prices over higher local prices.

Automotive News reports automakers are seeking help from the Secret Service and Customs to prevent any vehicle sold to a straw buyer from leaving port to the real customer residing in China, even though the exports are legal under current law.

Further, as the dealerships are paid in full for premium vehicles like the Land Rover Evoque or Tesla Model S, one federal judge in Ohio dismissed the alleged victimization of the dealer and automaker in her decision to make the federal government return two premium vehicles and $1.2 million in cash to an exporter.

Meanwhile, dealers must tread carefully around exporters, lest their automakers penalize such transaction, from chargebacks to being stripped of their franchise agreements. BMW, Porsche, Land Rover and Mercedes conducted the former to the tune of $30.4 million between 2008 and 2013.

Most of the legal trouble for exporters comes via tax evasion and identity faith, though those are ancillary to the civil lawsuits related to exporting premium vehicles to Chinese customers, who would otherwise be forced to pay two to three times the U.S. price at home. Said prices include heavy taxation and a 25 percent tariff on imported vehicles.

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US Politicians Appeal To Base Through Humble Vehicles http://www.thetruthaboutcars.com/2014/06/us-politicians-appeal-to-base-through-humble-vehicular-vocabulary/ http://www.thetruthaboutcars.com/2014/06/us-politicians-appeal-to-base-through-humble-vehicular-vocabulary/#comments Fri, 20 Jun 2014 13:10:29 +0000 http://www.thetruthaboutcars.com/?p=847993 As campaign season rolls out, politicians are appealing to their constituents — or at least, trying to appeal to them — by appearing to be on their level, including their choice of vehicle that they otherwise may have traded in for a Lexus or Mercedes a long time ago in their political career. Bloomberg reports […]

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2014 Chevrolet Silverado 1500 Exterior

As campaign season rolls out, politicians are appealing to their constituents — or at least, trying to appeal to them — by appearing to be on their level, including their choice of vehicle that they otherwise may have traded in for a Lexus or Mercedes a long time ago in their political career.

Bloomberg reports candidates are trading in their luxury rides for image-building vehicles such as Chevrolet Silverados, Harley-Davidson Road Kings, Toyota Prii, or — if vehicles in general would negatively affect their campaigning — the Shoe Leather Express. The strategy is meant to bring an air of humility on the campaign trail, which is needed to counter the charge that those who work on Capitol Hill are out of touch with the people they represent.

Aside from those who already see this tool through a cynical lens, vehicular appeal can have its drawbacks. In his failed bid for presidency, 1988 Democrat nominee Michael Dukakis turned up in a tank to appeal to those who heavily support the military. While the tactic worked for British Prime Minister Margaret Thatcher, and despite his service in the United States Army, the photo-op turned into a tool for opponent George Bush’s campaign, lambasting Dukakis for looking silly.

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Keystone Vote Looms Amid Iraq Implosion http://www.thetruthaboutcars.com/2014/06/keystone-vote-looms-amid-iraq-implosion/ http://www.thetruthaboutcars.com/2014/06/keystone-vote-looms-amid-iraq-implosion/#comments Mon, 16 Jun 2014 13:22:40 +0000 http://www.thetruthaboutcars.com/?p=844745 Global oil prices are on the rise as the crisis in Iraq contributes to market instability. Large chunks of Iraq’s oil production infrastructure have fallen under militant control, leading to a sharp drop in output. Meanwhile, Canadian officials are upset with the Obama administration’s handling of the Keystone pipeline. They contend that the inaction on […]

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Global oil prices are on the rise as the crisis in Iraq contributes to market instability. Large chunks of Iraq’s oil production infrastructure have fallen under militant control, leading to a sharp drop in output. Meanwhile, Canadian officials are upset with the Obama administration’s handling of the Keystone pipeline. They contend that the inaction on Keystone is keeping millions of barrels of Alberta crude from reaching more profitable markets.

Bloomberg reports that market analysts are divided on how much the Iraq crisis will influence crude prices in the future. This isn’t particularly surprising, given the number of variables in that still-developing situation. However, all observers expect that the price will only go up. The price of Brent crude on the London exchange has already crested $113 a barrel as of June 13; this is the highest level since last September. In the United States, West Texas crude is near $107, also the highest price since the previous September. Most forecasters expect oil to reach around $120 a barrel by the fourth quarter, when rising demand will also drive up prices. Longtime oilman T. Boone Pickens told CNBC that a complete shutdown of Iraqi production could drive oil into the $150-200 range by destabilizing world markets.

Part of the problem is attributable to the OPEC oil cartel’s difficulties in increasing supply. Since the Libyan revolution, oil production in that key OPEC member has declined precipitously to barely 10% of previous output. Meanwhile, fluctuating production in Nigeria and other OPEC members has introduced more volatility into the supply and demand curve. A report issued by the International Energy Agency last week states that Iraq could provide up to 45% of all growth in global oil output through 2020. As militants from the hyper-violent Islamic State in Syria and Iraq (ISIS) group overrun ever-larger swaths of the country and curb down production, that future is looking cloudy.

The latest Iraq crisis comes just as negotiations surrounding the embattled Keystone XL pipeline are finally coming to a head. The U.S. Senate Energy and Natural Resources Committee will likely vote this week to approve the pipeline. The bill under consideration is an attempt to sidestep the regulatory approval process, which critics say the Obama Administration has intentionally drawn out. The bill is unlikely to make it far in the Senate, due to general gridlock as well as the opposition of several key Senators.

The government of Canadian Prime Minister Stephen Harper is displeased with the Obama administration’s perceived stalling on the pipeline. Finance Minister Joe Oliver and Natural Resources Minister Greg Rickford have both criticized Obama, stating that continued delay of the pipeline is hurting the Canadian economy. Currently, crude from the Alberta oil sands is undervalued due to a transportation bottleneck, leading to lower prices. The Canadian Chamber of Congress estimates that this bottleneck is costing the Canadian economy as much as $50 million a day in lost revenue. Therein lies the contradiction at the heart of the dispute.

Environmental concerns and global warming have long been cited as the Obama administration’s reasons for drawing out the Keystone approval process. In reality, the economics of the pipeline are heavily skewed in Canada’s favor, to the possible detriment U.S. consumers. Keystone is the most visible manifestation of the long-term goal of Canadian energy companies to find markets outside the U.S. As the Wall Street Journal explains, and the Canadian Chamber of Commerce and Harper government freely admit, Keystone’s biggest benefit will be to Canadian oil producers, not American consumers. Keystone will enable them to export oil outside of the low-priced American market to higher-priced markets in Asia, Europe, and the developing world. Keeping Canadian crude from hitting world markets is in the best interests of the U.S., but not the Canadians. Of course, it’s not exactly kosher to say that out loud, considering that the United States is still getting about half its oil imports from Canada.

Given that, the “solution” to the Canadian oil price problem is probably going to be built entirely on Canadian soil. Oil companies are already developing a “Plan B” system of trans-Canada pipelines, should Keystone not be approved. Even so, the long-term viability of the Alberta oil sands depends on a relatively high minimum price floor. The highly adulterated quality of that oil, and the resulting expense of processing and refining it, means that Albertan production can only be profitable when the price of oil is relatively high.  This reason combined with new technology is the explanation for why Canadian tar sands haven’t been highly productive until recently. A worldwide decline in the price of oil, such as what happened in the 1980s and 1990s, could still be devastating to tar sands production.

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Alfa 4C Arrives In 86 North American Showrooms, Brings 342 Pounds Of Luggage http://www.thetruthaboutcars.com/2014/06/alfa-4c-arrives-in-86-north-american-showrooms-brings-342-pounds-of-luggage/ http://www.thetruthaboutcars.com/2014/06/alfa-4c-arrives-in-86-north-american-showrooms-brings-342-pounds-of-luggage/#comments Wed, 11 Jun 2014 10:00:11 +0000 http://www.thetruthaboutcars.com/?p=841969 Fiat Chrysler Automobiles has just released their initial list of dealerships who will have the right to sell the Alfa Romeo 4C to North American customers, while the sports car will bring 342 pounds of luggage for the trip from Modena to the selected showrooms. Autoblog reports all but four dealerships will be in the […]

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Fiat Chrysler Automobiles has just released their initial list of dealerships who will have the right to sell the Alfa Romeo 4C to North American customers, while the sports car will bring 342 pounds of luggage for the trip from Modena to the selected showrooms.

Autoblog reports all but four dealerships will be in the United States — the remaining four are in Canada — and the majority of those will be concentrated in three of the 33 states on the initial list: California, Florida and Texas. The chosen ones were drawn from a list of existing Fiat and Maserati dealerships, and though expected cities like Los Angeles, Orlando and Austin will be among the chosen, a few big names didn’t make the first cut, including New York, Seattle and Louisville, Ky.

Meanwhile, the chosen dealerships “will have a unique staff dedicated to the brand’s premium market clientele,” per the words of Chrysler Group vice president of network development Peter Grady. The dealerships are undergoing “an intensive curriculum” to ensure the success of the 4C and limited-edition 4C Launch Edition as FCA presses forward toward its goal of over 300 Alfa dealerships in North America.

As for the 4C itself, Jalopnik says the sports car packed on an additional 342 pounds to its 2,153-pound Euro-spec frame for the U.S. market, coming into port at 2,495 pounds. Aside from the usual federalization mandates, some of the weight comes from the standard air-con and radio equipped in the U.S.-spec model.

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Diesel Grows In Popularity Despite Price Fluctuations At The Pump http://www.thetruthaboutcars.com/2014/05/diesel-grows-in-popularity-despite-price-fluctuations-at-the-pump/ http://www.thetruthaboutcars.com/2014/05/diesel-grows-in-popularity-despite-price-fluctuations-at-the-pump/#comments Fri, 23 May 2014 12:00:32 +0000 http://www.thetruthaboutcars.com/?p=829361 Though diesel power is experience increased popularity among United States consumers, the wild fluctuations in the price for a gallon of diesel may put some potential oil-burner owners back on the gasoline bandwagon. Detroit Free Press reports the price fluctuations are linked to circumstances unrelated to those affecting prices for gasoline. Gasbuddy.com chief oil analyst […]

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2014-RAM-1500-Eco-Diesel-Exterior-001

Though diesel power is experience increased popularity among United States consumers, the wild fluctuations in the price for a gallon of diesel may put some potential oil-burner owners back on the gasoline bandwagon.

Detroit Free Press reports the price fluctuations are linked to circumstances unrelated to those affecting prices for gasoline. Gasbuddy.com chief oil analyst Tom Kloza explains that part of the swings that occurred this winter was due to the similarities between diesel and heating oil in wide use throughout Europe and the Northeastern United States. Another factor was increased demand for natural gas, prompting utilities and businesses to use diesel to generate electricity. Those and other unnamed factors drove the global price for a barrel of diesel between $119 to $130 in Q4 2013 and Q1 2014.

As for the overall market, organizations such as IHS Automotive and Diesel Technology Forum expect adoption rates of 6 percent to 9 percent by 2020, compared to 3 percent of the U.S. market currently. In addition, some 40 new vehicles are expected to enter showrooms within the next two years, ranging from pickups and SUVs to compact cars.

Diesel’s new-found popularity in the U.S. and developing economies means the oil fuel is the most common around the globe, surpassing gasoline. In turn, refiners and governments will see more profit in production and taxation from diesel.

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Subaru: No WRX Hatch For U.S. Market http://www.thetruthaboutcars.com/2014/04/subaru-no-wrx-hatch-for-u-s-market/ http://www.thetruthaboutcars.com/2014/04/subaru-no-wrx-hatch-for-u-s-market/#comments Wed, 23 Apr 2014 13:00:39 +0000 http://www.thetruthaboutcars.com/?p=808482 For those who want a Subaru WRX or WRX STi, but prefer the utility of the previous hatchback over the current sedan offerings, they should start breathing again, as Subaru will not be bringing such a beast to the United States after all. Motor Trend reports that last month, WRX project manager Masuo Takatsu informed […]

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Subaru Impreza WRX STi Hatchback

For those who want a Subaru WRX or WRX STi, but prefer the utility of the previous hatchback over the current sedan offerings, they should start breathing again, as Subaru will not be bringing such a beast to the United States after all.

Motor Trend reports that last month, WRX project manager Masuo Takatsu informed Motoring.com.au that Subaru “received strong interest from the US” for a hatchback variant, citing the 50 percent uptake by the U.S. market for the previous hatch. The statement came as a surprise to Subaru of America, who weren’t expecting anything more than the sedans:

We do not know about, nor do we have, any plans for a WRX hatch. Takatsu San is the product general manager of the WRX, but this is not something he has discussed with us.

One exchange between Subaru of America and Subaru of Japan later gave the final word: No WRX hatch will be forthcoming to the U.S. market, citing cost issues against producing both sedan and hatchback models.

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BMW May Build Second NA Plant To Fend Off German Rivals http://www.thetruthaboutcars.com/2014/04/bmw-may-build-second-na-plant-to-fend-off-german-rivals/ http://www.thetruthaboutcars.com/2014/04/bmw-may-build-second-na-plant-to-fend-off-german-rivals/#comments Wed, 09 Apr 2014 14:04:23 +0000 http://www.thetruthaboutcars.com/?p=791289 In its battle against Mercedes-Benz and Audi for record sales, BMW is mulling over the possibility of a second plant in North America. Bloomberg reports the automaker would place its second factory in Mexico, with two sites under consideration. The decision to expand will take a few months according to BMW production chief Harald Krueger, […]

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BMW Spartanburg

In its battle against Mercedes-Benz and Audi for record sales, BMW is mulling over the possibility of a second plant in North America.

Bloomberg reports the automaker would place its second factory in Mexico, with two sites under consideration. The decision to expand will take a few months according to BMW production chief Harald Krueger, Should the move be given a green light, the Mexican plant is likely to build the 3 Series.

The second factory would add to the long-term growth strategy BMW is using to fend off its German premium market competitors in a heated battle for records global sales, fueled by growing demand in the United States and China. Mercedes will add the C-Class to its Alabama facility in June with a new plant in North America due near the end of this decade, while Audi is in the middle of setting up shop in Mexico with a $1.3 billion plant set to produce crossovers beginning in 2016.

Previously, BMW announced it would invest $1 billion to expand its South Carolina plant by 50 percent in 2016, as well as add the X7 large SUV to the X Series lineup currently produced in the plant.

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BAIC Seeks To Acquire US, European Brand http://www.thetruthaboutcars.com/2014/04/baic-seeks-to-acquire-us-european-brand/ http://www.thetruthaboutcars.com/2014/04/baic-seeks-to-acquire-us-european-brand/#comments Fri, 04 Apr 2014 11:05:24 +0000 http://www.thetruthaboutcars.com/?p=787601 Looking to expand its global presence beyond its native China, Beijing Automotive Group announced they would like to acquire a “mid to high-level brand” in either Europe or the United States, and already has a list of potential brands in mind. Reuters reports BAIC originally looked towards Europe for their potential acquisition, but has now […]

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Senova BAIC C10

Looking to expand its global presence beyond its native China, Beijing Automotive Group announced they would like to acquire a “mid to high-level brand” in either Europe or the United States, and already has a list of potential brands in mind.

Reuters reports BAIC originally looked towards Europe for their potential acquisition, but has now expanded their search to the U.S. President Dong Haiyang told reporters that his company’s brand is little-known outside of China, and sees a European or American brand as a shortcut into the global marketplace.

At home, BAIC purchased two smaller rivals in 2013, and signed a joint investment agreement with Daimler AG last month, delivering $5.51 billion into their joint venture in order to double production by 2015.

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Japanese Automakers Find New Export Base, Opportunity In Mexico http://www.thetruthaboutcars.com/2014/03/japanese-automakers-find-new-export-base-opportunity-in-mexico/ http://www.thetruthaboutcars.com/2014/03/japanese-automakers-find-new-export-base-opportunity-in-mexico/#comments Tue, 11 Mar 2014 14:45:26 +0000 http://www.thetruthaboutcars.com/?p=769626 Within four months of each other, Honda, Mazda and Nissan have opened new factories in Mexico, taking advantage of the opportunities within the nation’s automotive industry to grow a new export base into the United States, Latin America and Europe while also gaining ground in the rapidly expanding local market, all in direct challenge to […]

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Mazda3s Loading Onto Three-Tiered Train Car

Within four months of each other, Honda, Mazda and Nissan have opened new factories in Mexico, taking advantage of the opportunities within the nation’s automotive industry to grow a new export base into the United States, Latin America and Europe while also gaining ground in the rapidly expanding local market, all in direct challenge to the Detroit Three and other automakers on both sides of the border.

Automotive News reports Mexico will become the No. 1 exporting nation to the U.S. by 2015 at the earliest in large part due to the 605,000 units per year added by the three Japanese automakers. Meanwhile, Toyota will begin production in 2015 at Mazda’s newly opened Salamanca plant prior to deciding whether or not to build a new factory of their own. Nissan’s premium brand, Infiniti, may also set-up shop in Mexico.

In turn, the Japanese will see benefits from the move, from mitigating losses from a weaker yen in exports from home and greater profit due to cheap labor, to no tariffs on exports to the U.S. due to the North American Free Trade Agreement and improved product availability resulting from shorter distances between markets.

Speaking of free-trade agreements, Japanese automakers will also have access to some 44 countries and up to 40 million sales annually as a result of Mexico’s many agreements, allowing them to take on competitors in Latin America and Europe.

Finally, the Japanese have taken market share away from the Detroit Three in Mexico’s own automotive market, holding a collective 42 percent over Detroit’s 35 percent in 2013, when just four years earlier Detroit dominated with 57 percent of the market over Japan’s 23 percent.

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Mexico Besting Japan, Canada In Auto Exports To The U.S. http://www.thetruthaboutcars.com/2014/02/mexico-besting-japan-canada-in-auto-exports-to-the-u-s/ http://www.thetruthaboutcars.com/2014/02/mexico-besting-japan-canada-in-auto-exports-to-the-u-s/#comments Mon, 24 Feb 2014 13:38:27 +0000 http://www.thetruthaboutcars.com/?p=752601 Mexico’s auto industry is set to ship more product north to the United States than Japan and Canada by the end of 2015, in part due to the effects the North American Free Trade Agreement has had on the country since its signing two decades ago. USA Today reports that with operations at Honda’s new […]

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2015 Honda Fit

Mexico’s auto industry is set to ship more product north to the United States than Japan and Canada by the end of 2015, in part due to the effects the North American Free Trade Agreement has had on the country since its signing two decades ago.

USA Today reports that with operations at Honda’s new $800 million plant in Guanajuato now online, the 200,000 Fits destined annually for the U.S. will push total Mexican exports to 1.7 million units this year, just 200,000 more than Japan’s exports from their home market. Mazda’s newest plant 25 miles away, when open this week, will add 230,000 units annually to the total, pushing Mexico past Canada by the end of 2015 to become the No. 1 exporter to the U.S.

At the time of NAFTA’s signing, the auto industry in Mexico produced 6 percent of the total output in North America. Twenty years later, that figure is now 19 percent, with 3 million units leaving the factory floor. Total valuation of the nation’s exports surged to $70.6 billion from $40 billion in 2007. The industry is now Mexico’s primary source of foreign currency, surpassing oil exports and remittances from migrant labor along the way.

This growth is driven by low wages — $16/day on average for Mexico’s 580,000 auto workers — which critics attribute to maintaining Mexico’s poverty rate between 40 percent and 50 percent two decades on. Meanwhile, the nation hasn’t fared any better as a whole, with overall economic growth at 1.1 percent in 2013, the worst rate of growth since the beginning of the Great Recession.

For Eduardo Solis, president of the Mexican Automotive Industry Association, the boom is about more than low wages, citing a new generation of local engineers and increases in automotive research as positive outcomes:

It’s not only about lower salaries. That’s short-sighted. It is a component of a larger equation that has to do with the expertise we are developing.

Aside from NAFTA opening the floodgates, the lack of tariffs has allowed Japanese manufacturers — the main driver behind new production in Mexico — to set up shop easily. Incentives from local governments, such as employee training, tax exemptions and infrastructure improvements, have helped to draw new factories to their cities.

Correction: an earlier iteration mistakenly quoted Mexican auto ages at $16 per hour.

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