Automotive News - September 8, 2008 - (Page 12) 12 • SEPTEMBER 8, 2008 opinion Makers must resist urge to backslide as gas price dips Summer is just about over. The kids are back in school, adults are back on the job, and the price of gasoline is receding from the peak of more than $4 a gallon that we paid just weeks ago. Some analysts expect pump prices to dip to as low as $3 a gallon by the end of the year, maybe even by Election Day. But that should not be a signal for the industry to go wobbly on its plans to produce a radically more fuel-efficient fleet of vehicles. Automakers and suppliers must stay the course. Collectively, Americans have a short memory. Since a $60 fill-up will seem a lot less painful than an $80 fill-up, some consumers will breathe a sigh of It would be relief and shop for larger vehicles. Lower gasoline prices might help a mistake dealers move some of the big pickups and SUVs that are still for automakers pushed up against the fence colto reverse course lecting dust and floorplan charges on their lots. There might even be a modest again before the step-up in demand for some of new product mix the bigger new models, such as the Dodge and Ford full-sized pickups that go on sale this fall. even gets That would ease some of the short-term pain felt by suppliers, to market. automakers and dealers. When gasoline prices spiked to more than $4 a gallon in the spring, automakers were faced with consumer demand for products even more efficient than those mandated by the federal fuel economy standards. It was a big challenge. Most automakers quickly revamped their product plans. General Motors shuttered truck plants and boosted plans for four-cylinder engines. Ford looked to Europe for ways to produce better, smaller cars for North America. Even BMW, with a global reputation for selling high-performance automobiles, cut production of its large-displacement engines to a trickle. It would be a mistake for automakers to reverse course again before the new product mix even gets to market. Since this is a market-driven economy, lower gasoline prices could tempt some automakers to backslide. The addictive lure of big-truck profits could obscure the rational truth that sooner or later, the price of gasoline will rise again. When it does, fickle consumers again will demand even better fuel economy. Any automaker that isn’t ready to meet that demand won’t deserve another chance. I don’t care what they call it. Recession, depression — I guess it depends where you live. If you live in Detroit, as I do, it has been a single-state depression for quite some time. I hate to say it, but it looks like the rest of the nation has been playing catch-up recently, and some states may have passed Michigan in the competition for a lousy economy. And even if Europe and Germany are having automotive years that are nothing to brag about, Volkswagen is now telling everyone that it passed Ford Motor Co. in sales in the first half, making it third in the world. It’s not pretty anywhere. Even the Chinese are slowing down. They are probably still seeing substantial increases, but when you expect 30 percent improvement every year, anything less is a big disappointment. The global economy is flat or slightly down, depending on whom you talk to. The automobile business, with a couple of DAILY AUTO NEWS >> You can get the news you need every day. Go to www.autonews.com/signup and sign up for our daily e-mail newsletter. Times are tough outside the U.S., too noticeable exceptions such as Russia, seems to have slowed down enough so that all the world’s economists have noticed. I’m not sure that it’s any solace for us to realize that everyone else is in the same kettle, but it appears to be true. It’s just going to be tougher for General Motors and Ford, which have been seeing some bright spots around the world. The automobile business is a global business, and as fuel costs rise in the United States, the products will become more global as well. It seems that all those products that were developed specifically for the North American market are declining steeply. Whether it’s a Toyota, Nissan, Ford, GM or Chrysler truck, no one has had much interest in buying one lately. The manufacturers still will sell a lot of big pickups and SUVs, but nowhere near the I’m not sure that it’s any solace for us to realize that everyone else is in the same kettle, but it appears to be true. number they sold a few years ago. Even Toyota, that global juggernaut, has cut its sales forecast for the rest of the year. And Toyota’s truck sales, like those of other automakers in North America, have dropped enough to force the company to stop production for a while. Toyota dealers have quite enough inventory, thank you very much. People haven’t been switching from pickups and SUVs to something else. They have stopped buying. That’s a recession. It’s a double-edged sword. Recession and high fuel prices make for a tough environment. submitted by one of our salespeople proves that you can never do too much training (“GM should tout its small cars”). Company policy regarding the media notwithstanding, the massive efforts made and dollars spent on touting small cars were apparently lost on our hapless salesperson. We are quite satisfied that Chevrolet has done so much to let the world know that it is a car company again and that in terms of quality, fuel mileage, safety and styling, Chevrolet’s cars are worldclass. Changing perceptions takes time and, uh, training. MARK FROST General Manager Jim Ellis Chevrolet Atlanta Plastics are losing cost advantage To the Editor: This is in response to an Aug. 13 report on www.autonews.com from the Management Briefing Seminars in Traverse City, Mich., “TI’s CEO says plastic can replace more steel parts.” Evidence suggests that our environment will be harmed as more plastics contribute to auto emissions and take up space in landfills in the United States and around the world. While the plastics industry reportedly has made improvements in fuel tank design and engineering in order to meet the zero-emission standards set by the California Air Resources Board, this has mainly been accomplished by changing the composition and increasing the thickness and number of layers of their tanks. The plastic tank makers also require special films to seal the vulnerable connections between fuel system components. These all add to the complexity and cost of plastic fuel systems to the point that plastic tanks are quickly losing their see LETTERS, Page 14 THE WEEKLY NEWSPAPER OF THE INDUSTRY Established in 1925, published every Monday by Crain Communications Inc. Keith E. Crain, Publisher and Editor-in-Chief Peter Brown, Associate Publisher and Editorial Director David Sedgwick, Editor Edward Lapham, Executive Editor HOW TO REACH US Web site: www.autonews.com Editorial staff autonews@crain.com Phone: 313-446-0361 Fax: 313-446-0383 Circulation Advertising subs@crain.com rgreer@crain.com Phone: 888-446-1422 Phone: 313-446-6050 Fax: 313-446-6777 Fax: 313-446-8030 Editorial data/research To locate information that has been published in Automotive News, call 313-446-1662. Customer service To start or renew a subscription or to report an address change or a delivery problem, e-mail subs@crain.com or call 888-446-1422 (in the U.S. or Canada) or 313-446-1662 (in all other locations). AUTOMOTIVE NEWS (ISSN 0005-1551) is published weekly at 1155 Gratiot Ave., Detroit, MI 48207-2997. Periodicals postage is paid at Detroit, MI and at additional mailing offices. Postmaster: Send address changes to AUTOMOTIVE NEWS, Circulation Department, 1155 Gratiot Ave., Detroit, MI 48207-2912. Canadian Post International Publications Mail Product (Canadian Distribution) Sales Agreement #40012850, GST#136760444. Canadian return address: 2-7496 Bath Road, Mississauga, ON L4T 1L2 Printed in the U.S.A. Let natural gas power the fuel cell To the Editor: I am responding to Edward B. Cohen’s frustrations with the alternative-fuels quagmire (“Touch all the bases in the fuel search,” Comment, Aug. 11). I have followed fuel cell technology for 20-some years and knew immediately that the fuel cell technology using hydrogen was doomed when President Bush blessed it in his first State of the Union address. The fuel cell is our answer as a future powerplant, but to suggest hydrogen as the fuel source for the fuel cell was a wild goose chase for all involved. If ever there were a protective measure for the oil companies, that was it. Why not use natural gas? It is our fuel and already has a small distribution system in place. It is safe, clean and cheap. Sterling Trucks and Cummins Engines have developed a natural-gas engine and already have taken more than 500 truck orders. Although their technology does not use a fuel cell, it proves that natural gas is available and safe to use. The technology is there to power a fuel cell today with natural gas. Let the oil companies buy up all the natural-gas distributors in this country. At least they would have a starting point for distribution, since there is none for hydrogen. PAUL T. MYERS Penn Freightliner Sterling of Harrisburg/Lancaster Harrisburg, Pa. Chevrolet does tout its small cars To the Editor: An Aug. 11 letter to the editor http://www.autonews.com/signup http://www.autonews.com http://www.autonews.com
Table of Contents Feed for the Digital Edition of Automotive News - September 8, 2008 Chrysler Financial hikes dealer floorplan fees Back in business? Detroit's best bets for cash: Feds, UAW Document fee suits swamp Missouri dealers Honda's family squabble Used truck prices rebound Ford mulls Lincoln compact Toyota delays RAV4 plan Proposed flex-fuel mandate roils industry Chrysler sues consultant over sourcing Cobalt transaction prices are up $775 since April Nissan looks to Mexico for engineering aid To retain truck buyers, Nissan offers more stuff Press: Chrysler is pushing forward on electric cars Leasing falls to 4-year low GM: Currency shift stalled Astra Dealers say they can sell the Republican ticket Industry loans clash with GOP climate Grand Cherokee will get axles from new plant Makers must resist urge to backslide as gas price dips Times are tough outside the U.S., too Chevrolet does tout its small cars Let natural gas power the fuel cell A crash course in collaboration Dodge wouldn't rush the RamBox Plastics are losing cost advantage Suppliers expect to benefit from tougher CO2 rules 'People just want Ford to go' For now, Honda will skip electric vehicles Toyota, Subaru enter race to market electric vehicles China exports squeezed Study: 15% of wrecked autos got washed titles Mercedes megadealer is bullish on luxury Sheehy: 'We are not in business for nostalgia' Automakers use driving schools as marketing tools Dodge smoothes Ram's rough edges â a little Honda touts leasing while others fall back Alysha Webb Study: Nonprime car loans get longer Dealer CPA group picks leader BMW, Edmunds team up on loan site for consumers Va. Honda dealership loses protest bid Judge throws out deceptive-ads lawsuit against Toyota in Arkansas Mo. dealership's protest gets go-ahead Pa. court throws out suit against Ford, dealership Dealers Ross' interiors company pushes into China, India More than a game Nissan's Tavares: Green conference keynoter Quality group seeks to set consulting standards Personnel Dana to shift HQ by Sept. '09 Tenneco to supply Volvo XC60 BMW gets Siemens conveyors IAC to cut 280 jobs in Sweden Polytec to acquire Peguform Metaldyne to sell Italy operation Federal-Mogul to build India plant Beck, Delphi make pact TRW to supply Chinese sedan Auto profits rise in Russia Black Book expands data Hayes Lemmerz cuts losses Ford: Buyouts are a tough sell GM's party plans include production Volt An ice-cold August for auto sales Big drop in Aug. output Lights, camera . . . Volt? In case the roads get too quiet . . . The Insight rides again Lagonda brand will be back Milwaukee road trip: No old pals, but 1 new lesson Choice of Odell seen as Ford vote of confidence in Volvo Dana sort of wins an award Automotive News - September 8, 2008 Automotive News - September 8, 2008 - (Page Introducti) Automotive News - September 8, 2008 - Detroit's best bets for cash: Feds, UAW (Page 1) Automotive News - September 8, 2008 - Detroit's best bets for cash: Feds, UAW (Page 2) Automotive News - September 8, 2008 - Toyota delays RAV4 plan (Page 3) Automotive News - September 8, 2008 - Cobalt transaction prices are up $775 since April (Page 4) Automotive News - September 8, 2008 - Cobalt transaction prices are up $775 since April (Page 5) Automotive News - September 8, 2008 - GM: Currency shift stalled Astra (Page 6) Automotive News - September 8, 2008 - GM: Currency shift stalled Astra (Page 7) Automotive News - September 8, 2008 - Grand Cherokee will get axles from new plant (Page 8) Automotive News - September 8, 2008 - Grand Cherokee will get axles from new plant (Page 9) Automotive News - September 8, 2008 - Grand Cherokee will get axles from new plant (Page 10) Automotive News - September 8, 2008 - Grand Cherokee will get axles from new plant (Page 11) Automotive News - September 8, 2008 - Let natural gas power the fuel cell (Page 12) Automotive News - September 8, 2008 - Let natural gas power the fuel cell (Page 13) Automotive News - September 8, 2008 - Plastics are losing cost advantage (Page 14) Automotive News - September 8, 2008 - Plastics are losing cost advantage (Page 15) Automotive News - September 8, 2008 - Suppliers expect to benefit from tougher CO2 rules (Page 16) Automotive News - September 8, 2008 - 'People just want Ford to go' (Page 16A) Automotive News - September 8, 2008 - Toyota, Subaru enter race to market electric vehicles (Page 16B) Automotive News - September 8, 2008 - Toyota, Subaru enter race to market electric vehicles (Page 16C) Automotive News - September 8, 2008 - Toyota, Subaru enter race to market electric vehicles (Page 16D) Automotive News - September 8, 2008 - For now, Honda will skip electric vehicles (Page 17) Automotive News - September 8, 2008 - For now, Honda will skip electric vehicles (Page 18) Automotive News - September 8, 2008 - For now, Honda will skip electric vehicles (Page 19) Automotive News - September 8, 2008 - Study: 15% of wrecked autos got washed titles (Page 20) Automotive News - September 8, 2008 - Study: 15% of wrecked autos got washed titles (Page 21) Automotive News - September 8, 2008 - Mercedes megadealer is bullish on luxury (Page 22) Automotive News - September 8, 2008 - Mercedes megadealer is bullish on luxury (Page 23) Automotive News - September 8, 2008 - Sheehy: 'We are not in business for nostalgia' (Page 24) Automotive News - September 8, 2008 - Sheehy: 'We are not in business for nostalgia' (Page 25) Automotive News - September 8, 2008 - Sheehy: 'We are not in business for nostalgia' (Page 26) Automotive News - September 8, 2008 - Sheehy: 'We are not in business for nostalgia' (Page 27) Automotive News - September 8, 2008 - Automakers use driving schools as marketing tools (Page 28) Automotive News - September 8, 2008 - Dodge smoothes Ram's rough edges â a little (Page 29) Automotive News - September 8, 2008 - BMW, Edmunds team up on loan site for consumers (Page 30) Automotive News - September 8, 2008 - BMW, Edmunds team up on loan site for consumers (Page 31) Automotive News - September 8, 2008 - Judge throws out deceptive-ads lawsuit against Toyota in Arkansas (Page 32) Automotive News - September 8, 2008 - Pa. court throws out suit against Ford, dealership (Page 33) Automotive News - September 8, 2008 - Dealers (Page 34) Automotive News - September 8, 2008 - More than a game (Page 35) Automotive News - September 8, 2008 - Personnel (Page 36) Automotive News - September 8, 2008 - TRW to supply Chinese sedan (Page 37) Automotive News - September 8, 2008 - TRW to supply Chinese sedan (Page 38) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 39) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 40) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 41) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 42) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 43) Automotive News - September 8, 2008 - Auto profits rise in Russia (Page 44) Automotive News - September 8, 2008 - GM's party plans include production Volt (Page 45) Automotive News - September 8, 2008 - GM's party plans include production Volt (Page 46) Automotive News - September 8, 2008 - An ice-cold August for auto sales (Page 47) Automotive News - September 8, 2008 - An ice-cold August for auto sales (Page 48) Automotive News - September 8, 2008 - Big drop in Aug. output (Page 49) Automotive News - September 8, 2008 - Dana sort of wins an award (Page 50) Automotive News - September 8, 2008 - Dana sort of wins an award (Page 51) Automotive News - September 8, 2008 - Dana sort of wins an award (Page 52)
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