While America Slept. Monday, December 15, 2008

Bertel Schmitt
by Bertel Schmitt
A short overview of what happened in other parts of the world while you were in bed. TTAC provides round-the-clock coverage of everything that has wheels. Or has its wheels coming off.

Asia bourses bullish on bail-out, Bush not sure: Tokyo stocks rebounded Monday morning, with the key Nikkei index climbing more than 4 percent, “as investors reacted to hope that the U.S. government will eventually save the embattled top U.S. automakers,” the Nikkei (sub) says. Japanese traders also liked that the yen dropped against the dollar, which makes Japanese goods less expensive in dollar terms. The market ignored remarks by Bush that an auto industry rescue is far from imminent. “We’re not quite ready to announce that yet,” Bush told Reuters on Air Force One during a flight from Baghdad on an unannounced visit to Afghanistan.

What can happen if a company actually owns its real estate: Mitsubishi plans to raise its office rents in Tokyo’s Marunouchi business district by an average of 15 percent despite the economic downturn the Nikkei (sub) reports. Overall demand for office space is weak in Japan, but remains strong in downtown Tokyo. Mitsubishi is confident that its offices in central Tokyo will remain highly sought-after because most are equipped with state-of-the-art IT networks and feature cutting-edge, energy-saving technology.

Chinese VW JVs say slow-down not true: Spokespeople of Volkswagen’s two Chinese joint-ventures denied reports that they were suspending production, Gasgoo says. On Sunday, Chinese state television had reports that FAW-Volkswagen and Shanghai Volkswagen were planning to partly suspend production lines “to conduct maintenance work.” SVW told Xinhua that they already accomplished their 2008 sales goal in November and postponed the maintenance work to the end of the year as the production lines had been operating at full capacity to meet market demand. FAW-VW, said production was “normal” and they would not suspend production even at the end of the year as usual. Even the China Association of Automobile Manufacturers (CAAM) weighed in on the issue. From January to November, auto makers in China produced about 8.7 million automobiles and sold more than 8.6 million, says CAAM. Inventories are “at a reasonable level.”

Chinese makers still get credit: BYD Auto signed a Development Finance agreement with China Development Bank today, Gasgoo says. Sums have not been specified. Today, BYD released its first electric hybrid car F3DM to the public. 50 units of the hybrid cars were sold to the Shenzhen municipal government and China Construction Bank. Last week, China’s Export and Import Bank agreed to grant Chery Automobile, one of the country’s Top 5 automakers, a loan of $1.5b. According to Gasgoo, “the moves indicate that China is helping its auto industry in policy and the home-brand carmakers are likely to get benefit first.” Joint ventures, apply to your own governments.

Bide Your Dime, Europe and US: BYD chairman Wang Chuan Fu told reporters that plans to sell their electric cars to Europe and the U.S. have been pushed back to 2011. According to Reuters, Wang did not give reasons for the delay.

Slow-down in Seoul: South Korea’s Kia announced plans to cut working hours amid weakening auto demand, following similar moves by sister firm Hyundai Motor Co , Reuters says. Hyundai Motor has suspended daily overtime work at some domestic lines. Kia is reducing each shift at its Gwangju plant to five to six hours from eight to ten.

VeeDub’s Winterkorn expects world market to tank in 2009: VW’s CEO Martin Winterkorn is preparing for worldwide auto sales to sink by 20 percent in 2009, Germany’s Autohaus reports. He thinks VW will outperform the market, but redies his company for a 10 percent reduction compared to 2008. The VW plant in Chattanooga will be built, damn the torpedoes. “The U.S.A. will continue to need cars. Our timing is spot-on. We want to be there for the re-bound.”

Abandon ship! Belay that, abandon crew! Fourteen crew and officers, mostly from the Philippines, have been stranded for three months in an Argentine river on a cargo ship abandoned by its owner, surviving on charity donations of food and water, Reuters reports. “The shipping company left the crew to its fate. The boat is out of fuel, food and drinking water,” said Manuel Romero, head of operations for the La Plata Coast Guard. It has been denied that this is a dress rehearsal for what will happen when Detroit abandons its ships.

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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  • Tesla deathwatcher Tesla deathwatcher on Dec 15, 2008

    I'm pretty sure Bush blinks on this one and bails out the carmakers. Stupid as that is. I can still remember back in 2003 when I was sure that Bush was bluffing about invading Iraq. I could not believe that he would really do it. Now I don't underestimate George W. Bush on any issue.

  • HPE HPE on Dec 15, 2008

    tesla deathwatcher: Surely you mean you don't misunderestimate him.

  • VoGhost Fantastic work by Honda design. When I first saw the pictures, I thought "Is that a second gen Acura NSX?"
  • V16 2025 VW GLI...or 2025 Honda Civic SI? Same target audience, similar price points. Both are rays of sun in the gray world of SUV'S.
  • FreedMike Said this before and I'll say it again: I'm not that exercised about this whole "pay for a subscription" thing, as long as the deal's reasonable. And here's how you make it reasonable: offer it a monthly charge. Let's say that adaptive headlights are a $500 option on this vehicle, and the subscription is $15 a month, or $540 over a three year lease. So you try the feature for a month, and if you like it, you keep it; if you don't, then you discontinue it, like a Netflix subscription. In any case, you didn't get charged $500 up front the feature. That's not a bad deal.In my case, let's say VW offers an over the air chip reflash that gives me another 25 hp. The total price of the upgrade is $1,000 (which is what a reflash would cost you in the aftermarket). If they offered me a one time monthly subscription for $50 to try it out, I'd take it. In other words, maybe the news isn't all bad.
  • 2ACL A good car, but - at least in this configuration -not one that should command a premium. Its qualities just aren't as enduring as those of Honda's contemporary sports cars. For better or worse, this is a formula they remain able to replicate.
  • Jalop1991 I just read that Tesla's profits are WAY down "as the electric vehicle company has faced both more EV competition from established automakers and a slowing of overall EV sales growth." This Cadillac wouldn't help Tesla at all, but the slowing market of EV sales overall means this should be a halo/boutique car. Regardless, yes, they should make it.
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