While America Slept. Friday, February 6th 2009

Geely doesn’t want Volvo: China’s largest privately owned carmaker Geely has denied reports that it is acquiring the Volvo car unit from Ford Motor Co, China Daily reports. Ford has also approached Chery Automobile Co and Chongqing Changan Automobile Co. Li Chunbo, an analyst with CITIC Securities Co in Beijing, said when a Chinese enterprise attempts to acquire a foreign rival it has to consider how it will benefit from the deal and whether it is capable of dealing with the purchased unit. “When you compare the market value of Geely and Volvo, you will ask how can Geely raise enough money to buy the European car brand,” he said. If this goes on much longer, not much money may be needed.

La bella clunker culleria: Italy is hopping on the European clunker culling bandwagon. Italian consumers will be given six months to go out and buy a new car under a “strong package” of incentives that Silvio Berlusconi’s centre-right government expects to approve today, Financial Times reports. The package would provide possibly up to €1,500 a car, to exchange models at least 10 years old for new, relatively small cars. The government would also provide credit guarantees to banks to finance purchases. The incentives are not limited to Italian cars, but the conditions attached—small capacity and least polluting—“would clearly favor Fiat,” the FT says. Protectionism, with style . . . .

GM begs from the poor: According to Wikipedia, Thailand is a Third World country. Poverty, especially in rural areas, is rampant. This doesn’t keep GM from begging there. The Thai unit of GM seeks financial support from the Thai government and local banks to help fund the development of a $429 million pickup truck project, the Nikkei [sub] reports. Steve Carlisle, President of General Motors Southeast Asia Operations Ltd., said that during its almost 10 years of operation, GM Thailand had never sought funding from Thai banks to support its operations.

Small is beautiful: Suzuki said that the mini-vehicle maker will seek to build an earnings structure that is profitable even on annual sales of 2.5 trillion yen, 1 trillion yen less than the level projected for this fiscal year, the Nikkei [sub] writes. The company has much more room for cost-cutting than Toyota, Osamu Suzuki told a Tokyo press conference. “Toyota is like a dry towel,” he said. “We are a drenched one from which a lot of waste can be squeezed out.” Suzuki expects to post an operating profit in the current year ending March 31 despite a steep decline in car demand around the world and the yen’s appreciation. One of the major reasons for Suzuki’s relative strength is its success in the Indian market.

Green breaks: The Japanese government plans to waive taxes on hybrid cars and electric vehicles completely, the Nikkei [sub] reports. Other types of environmentally friendly cars will also receive 50-75 percent tax reductions depending on their fuel economies and exhaust emissions.

Nissan has cash, asks government for more: Nissan considers applying for government assistance, which would likely take the form of around 50 billion yen in low-interest funds raised from the state-backed Development Bank of Japan, the Nikkei [sub] says. The company says it has plenty of cash on hand but is seeking to secure its financial base by diversifying its funding options. Nissan’s cash reserves totaled roughly 510 billion yen on Sept. 30, and it has access to more than 300 billion yen in credit. The automaker “has no cash flow problems,” says a senior company official.