Crunch Watch June 09: The Auto Industry In Crisis

Welcome to CAR's news aggregator as we round up the seismic change in the auto industry. Top tip: news summaries are added from the top hour-by-hour  

Tuesday 30 June 2009

• Porsche says it is no longer applying to the German Kreditanstalt für Wiederaufbau central bank for a €1.75 billion bridging loan. This means it'll now have to seek finance elsewhere (Porsche)

Seat announces its best-ever month for used car sales; it sold 915 second-hand cars in May (Seat)

Monday 29 June 2009

• Jaguar Land Rover has opened its first showroom in India. Tata boss and JLR owner Ratan Tata opened the Ceejay House flagship dealership in Mumbai.  

 Porsche and VW are at it again. This morning Porsche released a statement accusing VW of issuing an ultimatum for the two companies to agree a deal by the end of today. VW denied this, and now the state premier of Lower Saxony has said he's 'irritated' at Porsche's comments and wants the two companies to reach an agreement soon. Lower Saxony is a stakeholder in VW (Reuters)

Friday 26 June 2009

• Porsche is getting close to a deal with Qatar that would see it sell VW shares to the Middle Eastern state, rather than shares in itself (Reuters)

 GM chief executive Fritz Henderson has said that GM must exit bankruptcy quickly to avoid a 'fatal blow' to its suppliers, which could cause thousands of job losses (Reuters)

 Toyota has created a special management team to focus upon its North American operations, once its most lucrative market. Toyota is struggling with idle production capacity in the US, which helped to contribute to a $4.3bn loss in 2008 (Detroit News)

 Nissan's global production in May 2009 decreased 27% year-on-year, as sales fell 32% over the same period. In the UK production fell by 19.9% and European sales were down 29.8% in the same period (Nissan)

 China's National Development and Reform Commission is likely to reject Sichuan Tengzhong Heavy Industrial Machinery's bid for GM's Hummer. China's planning agency is reported to believe that Sichuan Tengzhong lacks the expertise to run Hummer, and is also worried that the SUVs are at odds with Beijing's conservation goals (Washington Post)

 The legal costs for Chrysler’s first month in bankruptcy has cost $12.7 million, which amounts to a bill of $12.4 million in fees and $256,000 in expenses from New York law firm Jones Day (Reuters)

Thursday 25 June 2009

• Plans to impose pay-as-you-drive charging have been dismissed by Lord Adonis, the new Transport Secretary (The Telegraph)

 Cab company LTI Vehicles has scrapped a 20-year old, 600,000-mile Fairway taxi under the scrappage scheme. It's owner, Sheldon Posner of Cricklewood Carriers, has received a £5000 discount on a new TX4 (LTI)

 The Society of Motor Manufacturers and Traders (SMMT) has formed a new Electric Vehicle Group. Made up of motor industry representatives from volume manufacturers, niche vehicle producers and component suppliers, the group aims to promote an industry-wide approach to the development of low carbon technologies (SMMT)

 GM has invited a number investors to submit improved offers for Opel/Vauxhall, as it attempts to secure a quick deal with Magna (Financial Times, subscription required)

 Mazda's global production was down 37% in May 2009 compared to May 2008, and production for the year-to-date is down 51% (Mazda)

 Mitsubishi's global production in May 2009 compared to May 2008 was down 54.6%, its 15th consecutive monthly decrease since March 2008 (Mitsubishi)

 BP has chosen a new chairman after a lengthy search. Carl-Henric Svanberg, currently chief executive of Swedish telecoms company Ericsson, will join the BP board in September, before replacing current boss Peter Sutherland in January 2009 (The Times)

Wednesday 24 June 2009

 Ford will raise its UK prices by an average of 4% from the start of July 2009, affecting customers who order cars after 30 June. Ford claims the rise is due to the Sterling's continued weakness against the Euro (Ford)

 The US government will award Ford, Nissan and Tesla cheap loans to re-equip their factories to build electric vehicles. Tesla will receive $465m, Nissan gets $1.6bn and Ford will get $5.89bn (Financial Times, subscription required)

 FIA president Max Mosley has agreed not to run for re-election as part of a deal to avoid a breakaway Formula One series. FOTA (the Formula One Teams Association) has confirmed that a deal has been struck that will see it remain in F1 in 2010 and beyond. 'There will be no split,' said Mosley. 'I will not be up for re-election, now we have peace.' (The Telegraph)

 GM has started to provide details on severance and early retirement to salaried and executive employees as it seeks to cut 4000 jobs by 1 October 2009 (Detroit News)

 Ricardo has been contracted to build a new eight-speed automatic tranmission for China's Weifang Shengrui. The gearbox will be built in China from late 2011 (Ricardo)

Tuesday 23 June 2009

• The UK government has launched a £25m electric car trial. Over 340 cars will be involved in the trial over the next two years, which is organised by the Technology Strategy Board (TSB) and designed to showcase electric cars (BBC)

 The Society of Motor Manufacturers and Traders (SMMT) has welcomed the government's £25m electric car trial: 'Ultra low carbon vehicles are now mainstream business for the UK motor industry and the TSB’s competition provides the ideal incentive to develop and demonstrate new technologies,' said SMMT chief executive Paul Everitt. 'This project marks the beginning of an important new phase for the UK motor industry' (SMMT) 

Nissan's European R&D HQ has hosted the launch of the UK Hydrogen Network (UK-HyNet) project, an coordinated national programme designed to create a hydrogen infrastructure in the UK, and make the country one of the world's leading hydrogen economies by 2015 (Nissan)

Monday 22 June 2009

 Seat has laid the foundation stone for the body workshop at its Martorell factory, which will build the Audi Q3 from 2011 (Seat)

 Porsche's figures for the past nine months show 911 sales were down 18.2%, the number of Cayennes shifted was down 25.1%, and Boxster/Cayman sales slumped 46.7% (Porsche)

 Germany's Manger Magazin has reported that Daimler is in advanced talks with Porsche to buy a stake in the sports car company, though officials from both companies denied the claim (Reuters)

 Following successful UK trials, Smart has announced that is electric Fortwo will go into small-series production, with the first cars coming to the UK in early 2010. The second-gen EV Smart will also take part in projects in Rome, Milan and Paris, while the cars are also due to start trials in several US cities. Smart claims the new car will have a longer range, shorter charging time and improved performance (Smart)

Friday 19 June 2009

Porsche sales slumped by 28% between  August 2008 and the end of April 2009, fresh company results out today revealed (BBC News)

Chinese media reports claim car maker Geely is close to a deal to buy Volvo. But the Swedish car maker denied it had signed a preliminary deal (Autocar)

GM's comeback is expected in mid-July, weeks earlier than originally planned. The new GM will emerge from bankruptcy in meaner, leaner shape cut free from much of its debt (Financial Times)

UK car production fell again in May, down 43% on last year's figure. So far in 2009, 54% fewer cars have been built but the SMMT claims that the falls are decelerating (Society of Motor Manufacturers and Traders)

Thursday 18 June 2009

Fiat sparks fears of widespread job cuts and plant closures as it announced a strategic shake-up of its domestic business. Overseas media report that Centro Stile design staff are being consulted (Financial Times)

Baard Eker, the Norwegian designer who controls supercar maker Koenigsegg, claims he wants to 'rejuvenate the soul and spirit' of Saab if his company's bid to buy the maker from GM succeeds (Automotive News Europe, subscription required)

Wednesday 17 June 2009

Porsche has issued a statement refuting a report published by The Financial Times Deutschland. Porsche says the FTD's claims that Ferdinand Piëch prevented the 'quick entry of Qatar at Porsche' is 'incorrect', and that 'the family stands unanimously behind the talks with an investor'. Porsche also stated that 'the FTD article is nothing more than a transparent, destructive action, which we won't allow to distract us from our course.' (Porsche)

Volkswagen's 1.4-litre TSI twincharger engine has scooped the International Engine of the Year title, beating both Honda and Toyota's new petrol-hybrid powertrains (Engine Technology International)

Infiniti has announced UK prices for its G-range. The G37 saloon is priced at £30,300-£34,700. the Coupe costs £31,950-£35,150, and the G37 CC starts at £38,900 rising to £41,900 (Infiniti) 

Tuesday 16 June 2009

GM and Koenigsegg have signed a memorandum of understanding that should see Saab sold to the Swedish supercar manufacturer within the next few months (see full story here) (General Motors)

Saab's sale to Koenigsegg is expected to safeguard over 3000 UK jobs (The Times)

Caterham has achieved pan-European homologation for a number of its models. With the help of Ford Component Sales, Caterham now has European Community Small Series Type Approval (ECSSTA) for its R300 Superlight, Roadsport 175, 120bhp Sigma and 2.3-litre 200bhp Duratec models, a move that removes the time consuming issue of individual national homologation (Caterham)

Renault has announced UK prices for its new Megane Sport Tourer. The range starts at £15,485 for the Expression 1.6 100, rising to £22,785 (Renault)

Monday 15 June 2009

Swedish supercar maker Koenigsegg is set to receive a €500 million loan guarantee from the Swedish government, if it wins the race to buy Saab from stricken GM. Ministers are keen to see Saab stay under Swedish ownership (Financial Times)

More than 60,000 Brits have ordered a new car under the UK's scrappage scheme, the Government announced today. They are lured by a £2000 discount, funded by a £300m state fund which could benefit 300,000 customers (BBC News)

GM hopes to complete the deal to sell Hummer by the third quarter of 2009. Sichuan Tengzhong Heavy Industrial Machinery says it has no plans to transfer Hummer equipment or technology to China or take on any debt (Automotive News, subscription required)

'We want to make a green Hummer,' says Yang Yi, Sichuan's general manager. 'We think the Hummer has huge potential in emerging markets' (Automotive News, subscription required)

GM is cutting some of its Nascar funding. Top-tier teams in the Sprint Cup series won't be affected, but the Nationwide and Camping World Truck series have been cut (Autoblog)

Seat has announced pricing for its hot Ibiza models. The 147bhp Ibiza FR is £14,995, the 178bhp Cupra retails at £15,995, and the black bodykitted Bocanegra is £16,695. All three use the VW Group's familiar turbo and supercharged 1.4-litre engine, mated to a seven-speed dual-clutch gearbox. Deliveries begin on October 1 2009 (Seat)

Friday 12 June 2009

Saab, General Motors’ Swedish premium brand, is most likely to be bought by Swedish supercar manufacturer Koenigsegg along with Norwegian investors (Financial Times)

Business secretary Lord Mandelson and the German economy minister have said they are keen to talk to other bidders for General Motors Europe – despite the memorandum of understanding signed with Magna International (The Times)

US car parts makers have appealed to the Obama administration for at least another $8bn-$10bn to stave off widespread bankruptcies (Financial Times)

memorandum of understanding signed with Magna International (The Times)

VW has launched a Bluemotion version of its Touareg 4x4. A detuned 3.0 TDI engine (down from 237 to 222bhp), together with revised aerodynamics and lowered suspension help lower the fuel consumption and CO2 emissions (from 30.4mpg to 34, and 244 to 219g/km respectively), but prices are up £430 (Volkswagen)

Thursday 11 June 2009

The newly formed Fiat and Chrysler alliance announces it 'will begin operations immediately.' Sergio Marchionne will become the chief executive of Chrysler, in addition to Fiat (Financial Times)

Jim Press, the ex-Toyota bigwig at 'old' Chrysler, will stay on in the new company. Marchionne has appointed the 62-year-old as deputy CEO as part of a brand organisation that mirrors Fiat's (Automotive News, subscription required)

Tata's three important divisional heads, including the boss of Tata Motors, are to retire next year upon hitting mandatory retirement age of 65. Managing director Ravi Kant will be replaced by Prakash Telang, who previously headed up the commercial vehicles division (Financial Times)

UK industrial production increased by 0.3% in April – the first monthly increase for 14 months. It could be a sign that the economy is improving earlier than anticipated (The Times)

Edward Whitacre, former chairman and chief executive of telecoms group AT&T, will become General Motors’ new chairman after the car maker has been restructured (Financial Times)

BP has said global oil demand has fallen for the first time in 15 years, falling by 0.6% (Daily Telegraph)

BMW has avoided lay-offs and is pushing ahead with a $750 million expansion plan at its Alabama, US production plant owing to strong exports of SUVs and flexible manufacturing. It built a record 171,000 X5 and X6s – 60% for export – the company said (Automotive News, subscription required)

Wednesday 10 June 2009

Fiat SpA has been cleared to form an alliance with Chrysler after a high court turned down a challenge from Indiana pension funds and other groups. The news sent Fiat’s shares spiking by 3% (Reuters)

Chrysler would have gone out of business of business by next week if the deal between Fiat and Chrysler had been delayed, the US government and Fiat warn (Financial Times)

PSA Peugeot-Citroen is to spend over €2 billion to help its suppliers get through financial problems, as it launches a 40-person taskforce to help its components chain (Automotive News Europe, subscription required)

London black taxi maker Manganese Bronze has raised £9.4m after it placed 5.4 million shares at 187p – a discount of 9% on Monday’s closing share price of 206p. The company’s shares rose 22p to 228p (Financial Times)

German state premier Roland Koch said yesterday that Fiat had no chance of securing the winning bid for Opel, saying: ‘Fiat's entry would have raised more questions than it answered. There was not a second of due diligence for Fiat’ (Automotive News Europe, subscription required)

New York crude oil has reached $71.18 – its highest level in 2009. The oil price has more than doubled in the past four months over speculation the worst of the economic downturn may be over (The Guardian)

Tuesday 9 June 2009

Ferrari CEO Amedeo Felisa has confirmed that the company will unveil a hybrid concept very soon. It won't be at Frankfurt, according to Felisa, 'but shortly thereafter, probably at an American show' (Car and Driver)

• Porsche is in advanced talks to sell a large stake of the German sports car company to the Gulf state of Qatar, easing the manufacturer’s financial problems (Financial Times)

• Three groups have entered bids to purchase Saab from General Motors hands. A preferred bidder will be announced by the end of the week, and GM has the choice of supercar maker Koenigsegg, private holding Renco or Wyoming, a group of investors (Financial Times)

• Magna International, Opel's likely new owner, will tour Vauxhall's two UK factories today (Financial Times)

• Fiat CEO Sergio Marchionne has said the Italian company ‘won’t walk’ away from its bid to buy Chrysler, despite the US Supreme Court delaying the deal (Reuters)

• Car parts maker Continental is examining a full merger with German bearings maker Schaeffler. The merger would create a company with €33 billion in sales (Reuters

• Despite falling into administration yesterday, van maker LDV is thought to have three potential buyers. However, 850 workers have been made redundant, 1200 dealership and distribution jobs are at risk, and an estimated 4000 jobs at parts suppliers could also be lost (The Times)

Monday 8 June 2009

Lamborghini announces it will cut its cars' CO2 emissions by 35% by 2015. Following the direct-injection system used in the LP560-4, the company is also currently researching stop-start systems, biofuels, hybrid drivetrains and weight-saving technologies (Lamborghini)

The Italian supercar manufacturer also intends to reduce the CO2 emissions of its Sant'Agata factory by 30% by 2010, thanks in part to a 17,000sq m photovoltaic roof-top. Lambo is investing €35m over the next five years (Lamborghini)

Nissan is recruiting an additional 100 manufacturing staff on four-month temporary contracts at its Sunderland plant as a result of the UK's car scrappage scheme. Last month it had to recruit 150 temporary workers to keep up with continental demand from similar schemes (Nissan)

Van maker LDV is expected to be placed in administration by a court today, putting around 850 jobs on the line (BBC News

German weekly magazine Focus is reporting that the Gulf state of Qatar will make a deal with Porsche by mid-June to help the manufacturer clear its €9billion debt pile (Automotive News Europe, subscription required) 

Continental AG has reached an agreement with a French union on the closure of the tyre maker’s plant in Clairoix, France (Automotive News Europe, subscription required)

Renault’s chief operating officer Patrick Pelata says the French car manufacturer is expecting a 25% drop in predicted 2009 sales (Automotive News Europe, subscription required)

Fiat CEO Sergio Marchionne has said Fiat has a ‘minimal’ interest in Saab without Opel, but is still interested in taking over Opel (Automotive News Europe, subscription required)

Land Rover has announced prices for the revised Range Rover, with the 3.6-litre TDV8 Vogue starting at £64,695, and the Autobiography-only 5.0-litre supercharged V8 topping the range at £79,995 (Land Rover)

Friday 5 June 2009

Lexus has topped the UK's 2009 JD Power customer satisfaction award. It’s the company’s ninth straight win since it was first eligible in 2001 (Lexus)

Opel will receive a €500m cash injection from Russia’s Sberbank and Magna International to help the company save jobs while its assets are restructured (Automotive News Europe, subscription required)

After committing €500m to Opel, Sberbank plans to sell its stake in the business to another Russian investor (Financial Times)

Kia plans to invest €111 million in building a new engine plant in Slovakia, boosting engine production capacity in the country from 300,000 to 450,000 (Automotive News Europe, subscription required)

A US court will hear today from a protest group that Chrysler’s sale to the group including Fiat SpA and the US government violates long-standing bankruptcy law and should not be allowed to go forward (Automotive News, subscription required)

Thursday 4 June 2009

Porsche is seeking a €1.75 billion loan from the German government's economic stimulus programme to secure the last chunk of refinancing it needs. It's trying to raise €12.5bn of credit lines to shore up its balance sheet after the expensive – and aborted – attempt to take over VW (Financial Times)

GM chief exec Fritz Henderson has reluctantly agreed to a request by a senator to reveal which dealerships will be terminated. GM plans to close 3400 outlets in the next two years – so the remaining showrooms will double their turnover of cars (Automotive News, subscription required)

Magna International says it plans to complete its takeover of Opel by the end of September (Automotive News Europe, subscription required)

The bidders for Saab have been whittled down to two, reports Reuters. The interested parties are believed to be Swedish supercar specialist Koenigsegg and US investment group Renco (Autoblog)

PSA Peugeot Citroen issues the second signal in as many days that it's looking for partners. New chief exec Philippe Varin reveals his vision to make PSA 'a major player in the automotive markets'. Varin started his job on Monday: 'If we can't become more global more quickly through organic growth alone, we won't hesitate to seize opportunities for external growth and partnerships' (Financial Times)

Wednesday 3 June 2009

The deal for Fiat to buy Chrysler could face a delay. The US Court of Appeals has agreed to hear a challenge to Chrysler LLC's sale of most of its assets to Fiat, by a group of Indiana pension funds that hold a small portion of secured debt (Reuters)

Chrysler is planning to reopen most of its factories by the end of June 2009. No decisions have yet been made on which plants will open and when (Automotive News, subscription required)

PSA Peugeot Citroën's biggest shareholder, the Peugeot family, has said it would be willing to dilute its stake so that the company could make new alliances (Wall Street Journal)

General Motors is offering some dealerships $100,000 to $1 million to wind down their businesses over the next 17 months, and just $10,000 to $200,000 for Pontiac-only franchises (Automotive News, subscription required)

Sichuan Tengzhong Heavy Industrial Machinery Company, a Chinese privately owned manufacturer, is the private buyer taking Hummer off General Motors' hands (Financial Times)

US new vehicle sales reached their highest levels of the year in May. However, the figures are still below profitable levels (New York Times)

Ford Motor Co and General Motors for May have posted their smallest monthly sales declines since last summer (Automotive News, subscription required)

LDV has said it will reapply for administration, after Malaysian company Westar said it won’t rescue the UK van maker (Wall Street Journal)

Tuesday 2 June 2009

• VW will bring the Touareg Bluemotion to the UK, for a paltry £420 premium over the regular 3.0 TDI model. The mpg figure is up from 30.4 to 34, while CO2 emissions are down from 244g/km to 219g/km (VW)

Subaru has confirmed that its new Legacy estate and Outback models will go on sale in the UK from late September 2009, but that it won't sell the saloon variant in Blighty (Subaru)

GM confirms it has signed a memorandum of understanding to sell its Hummer SUV brand. No suitors have been named, but GM claims the sale – likely in the third quarter of 2009 – could safeguard 3000 US jobs at factories and dealers (Automotive News, subscription required)

Kia Motors UK's managing director Paul Philpott is leaving his post to become chief operating officer at the European head office (Kia)

The US Chamber of Commerce criticises the US government's part-ownership of GM and Chrysler, arguing there are already 'clear examples of market manipulation and protectionism' (Financial Times)

GM will move quickly now its in Chapter 11; the Wall Street Journal reports that the company plans to announce the sale of Hummer today (Wall Street Journal)

President Obama praises the 'quick, surgical' bankruptcy process at Chrysler – a court order yesterday reveals the Chrysler sale can close on Friday (Financial Times)

Monday 1 June 2009

• General Motors files for bankruptcy protection. See our separate story for the full lowdown on America's biggest corporate failure (CAR Online)

• The future of Vauxhall’s UK factories remains uncertain, despite Magna International’s deal to buy the European arm of GM. Business secretary Lord Mandelson said Magna has been ‘very vague about their job and business plans’, adding he found it surprising that unions had not supported Fiat, who had been more specific about their plans (Daily Telegraph)

A report from manufacturers’ trade body EEF suggests the UK economy will grow after manufacturers reported they were running low on stocks, bringing hopes of more orders (Financial Times)

A US bankruptcy judge has approved the sale of most of Chrysler's LLC assets to Fiat. Judge Arthur Gonzalez approved the $2 billion sale of assets to a new company that will be 68% controlled by a healthcare trust, 20% by Fiat and 12% by the US and Canadian governments (Automotive News, subscription required)

Honda today restarted car production at its Swindon plant after a four-month lay-off – but it's only working at half capacity. Staff have voted for a 3% pay cut, in a bid to preserve more jobs (BBC News)

>> >Click here for the May 2009 Crunchwatch

>> >Click here for April 2009 Crunchwatch

>> Click here for March 2009 Crunchwatch
>> Click here for February 2009 Crunchwatch
>> Click here for January 2009 Crunchwatch
>> Click here for December 2008 Crunchwatch

 

Source : http://www.carmagazine.co.uk/car-news/industry-news/crunch-watch-june-09-the-auto-industry-in-crisis/

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