While America Slept. Tuesday, December 16, 2008
More belt tightening in Japan: A year ago, Suzuki entered the World Rally Championship. Yesterday, they said they would stop competing in the series from next year “due to the cost burden,” as the Nikkei (sub) has it. Fuji Heavy Industries, the manufacturer of Subaru, is also considering pulling out of the WRC. This follows Honda’s recent decision to withdraw from Formula One racing. The annual cost of staying in WRC racing is estimated to be in the $50m ballpark. Every Yen saved is a Yen earned. Everybody is waiting for more expensive shoes to drop in Formula 1, where the price of admission is $500m. All eyes on hapless Toyota. For starters.
BYD bullish on cars: China’s BYD Co. aims to double sales of automobiles next year, defying the gravity of the auto market, Gasgoo reports. BYD plans to sell 350,000 vehicles in 2009, up from a total of 180,000 cars it plans to sell this year. In 2007, BYD sold about 90,000 vehicles. What is hurting BYD is the slowdown in worldwide mobile phone sales, for which BYD supplies the bulk of the batteries.
Joint Isuzu/Toyota oilburner killed. GM asks for help: Toyota and Isuzu have decided to shelve plans to jointly develop and make diesel engines, Isuzu President Susumu Hosoi told The Nikkei (sub.) The two automakers had plans to develop a small diesel engine for passenger vehicles, and build it together in a plant at Isuzu. In addition, Isuzu will freeze spending for constructing auto body plants overseas along with investments to boost engine output at home. Cash-strapped GM, with which Isuzu has an operating alliance, “has asked for increased cooperation on supplying auto bodies and engines,” said Hosoi. Full-scale talks will begin depending on a bailout package for GM being considered by the U.S. government.
Shanghai GM builds private roads: Shanghai General Motors (SGM) have received the necessary permits to build a vehicle proving ground in Guangde, Anhui province, Gasgoo reports. The project will cost $234 million and would cover an area of 5.6 square kilometers. It will serve the product development and testing needs of Shanghai GM, as well as GM’s Pan Asia Technical Automotive Center (PATAC) automotive engineering and design joint venture. Someone is planning to develop a lot of cars in China.
Daimler makes batteries: And we aren’t taking starter batteries. Daimler entered a joint venture with the German company Evonik to built lithium-ion batteries for plug-ins and hybrids. Daimler acquired a little less than 50 percent of the Evonik subsidiary Li-Tec, which builds the batteries. Daimler isn’t looking at using them all for themselves, they want to sell them to other car makers, Automobilwoche (sub) says.
Berlin blames it on Bush: Germany’s government sees no real urgency in helping Opel, because Bush said he could give GM some money. Also, Opel’s home state Hesse doesn’t see an urgent need to spend any money, Das Autohaus says. Government circles reiterate that they want to make sure the money won’t vanish in Detroit.
Fiat stops the lines: On Monday, Fiat sent 48,000 workers home on extended Christmas holidays, and told them: “Don’t come back before January 12.” In November, Fiat lost 29.5 percent in Italy with 138,352 units sold. Tat was their worst month since 1993, reports Das Autohaus. In India. Fiat delayed the launch of their mid-sized Linea sedan to January, Reuters reports.
How does Santa deliver what others can’t? “Santa exploits the space-time continuum,” says Larry Silverberg, a professor of mechanical and aerospace engineering at North Carolina State University to Reuters. “He understands that space stretches, he understands that you can stretch time, compress space and therefore he can, in a sense, actually have six Santa months to deliver the presents.” News that Professor Silverberg has been called to Detroit to apply his findings to automotive and financial engineering have so far been unconfirmed.
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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Subaru not competing in the WRC? I honestly never thought I'd live to see the day.
Racing doesn't really mean anything, at least not to mass-market vehicles. It doesn't work as a marketing vehicle (well, outside of NASCAR, and even there...) and there's not a lot of technology sharing happening, especially as the requirements for passenger cars (emissions, fuel economy, spaciousness, low-speed safety, long-term reliability) and race cars (technical requirements, short-term durability, extreme-speed survivability) diverge. Subaru is a sort-of exception: the Impreza does trade somewhat on it's rally heritage, but no so much as to really matter. And it certainly doesn't help Legacy/Outback, Forester or Tribeca sales. I suppose it comes down to this: if I was buying a non-STI Impreza, would I give a damn that Subaru competes in WRC, but Mazda (or whomever) does not? No, and neither would most other buyers.