Automotive News - March 31, 2008 - (Page 41)

MARCH 31, 2008 • 41 Plastech legal bill: $1 million for a month DETROIT — Financially troubled supplier Plastech Engineered Products Inc. owes its Chapter 11 legal team more than $1 million in fees and expenses for work done in February. The New York law firm Skadden, Arps, Slate, Meagher & Flom LLP last week billed Plastech $1,002,674 in legal fees and $54,486 in expenses during the supplier’s first month of Chapter 11 reorganization, according to documents filed in U.S. Bankruptcy Court in Detroit. Plastech filed for Chapter 11 protection on Feb. 1. Center will provide preemployment assessment and job training for workers at Kia Motors Manufacturing Georgia. The factory is scheduled to begin production in late 2009. At full capacity, the plant will produce 300,000 vehicles annually. The state of Georgia built the center as part of its $400 million incentive package to land the Korean automaker. OUTPUT Axle strike leads GM to shift factory plans continued from Page 1 Second-quarter slide Cuts at the Detroit 3 will continue to drag down total North American vehicle production. Q2 ’08 Q2 ’07 % CHANGE The Cobalt SS: On sale in late April Cobalt SS price: $22,995 DETROIT — General Motors has set the base price of the 2008 Chevrolet Cobalt SS at $22,995, including shipping. The coupe is powered by a turbocharged 2.0-liter engine producing 260 hp. The vehicle will arrive in dealer showrooms in late April. Nissan idles Mexico plant MEXICO CITY — Nissan Mexicana SA de CV said last week that it had closed its assembly plant in Aguascalientes, Mexico, on March 18 and 19 and from March 24-28, because of weak demand in the United States. The plant makes the Sentra and Versa sedans for the United States and Mexico. The plant will reopen today, March 31. Continental to cut jobs FRANKFURT — German auto supplier Continental AG said it would cut 1,500 to 2,000 jobs worldwide in the next two years in connection with the restructuring of its powertrain division after last year’s acquisition of Siemens VDO. Continental also said Karl-Thomas Neumann, a senior executive, would assume responsibility for the powertrain unit. Kia opens Ga. training center WEST POINT, Ga. — The first building that will be part of Kia Motors Corp.’s $1 billion assembly complex in Georgia opened last week. The Kia Georgia Training ica. American Axle supplies axles to nearly all GM pickups and SUVs. CSM estimates that the strike dragged industrywide North American production for March to a seasonally adjusted annual rate of just 11.8 million units. That would be the lowest level in a decade — since a 54day strike by the UAW in 1998 idled virtually all GM assembly plants in North America. For forecasting purposes, CSM assumed that the strike will end by April 1 and therefore won’t hurt GM’s second-quarter output. That seems unlikely. If the strike ends, CSM predicts output in April will bounce back to a seasonally adjusted rate of 15.5 million vehicles. But for every day the strike continues, “that figure will easily start to dwindle,” says Joe Langley, CSM senior analyst for North American forecasts. Erich Merkle, vice president of forecasting for IRN Inc., of Grand Rapids, Mich., expects production will rebound slightly in the second half of the year, partly in response to the strike. “At some point in time, they are going to have to go in and make up for that lost inventory,” Merkle says. GM Ford Chrysler Toyota Honda Nissan Other TOTAL 1,059,000 725,000 602,000 446,000 391,000 303,000 328,000 3,854,000 1,125,000 812,000 715,000 440,000 370,000 280,000 319,000 4,061,000 –5.8 –10.7 –15.7 1.4 5.5 8.1 2.7 –5.1 Source: CSM Worldwide Cars ease truck pain GM’s production would be off even more if it weren’t for cars, especially the Chevrolet Malibu and Impala, says Langley. Pointing to the Impala, he says, “It’s almost insane how strong they are building that car.” Ford will slash production 10.7 percent in the second quarter from a year earlier to 725,000, CSM says. And it could have been worse. HYBRIDS Calif. action creates an instant market continued from Page 1 California’s targets For the years 2012 through 2014, California regulators ordered automakers to Sell 66,000 plug-in hybrids Sell 7,500 electric cars or fuelcell vehicles Sales of the Ford F-150 remain stronger than expected as the pickup enters the last few months of its life cycle. With a redesigned F-150 due for a production launch in July and sales launch in September, Ford is supporting its best-selling truck with incentives and is still building the current edition. Earlier this year, the import-brand manufacturers were boosting output as if immune from the softening market. No more. They, too, are slowing or trimming production of certain vehicles, mainly pickups and SUVs. CSM predicts Toyota’s North American factories will produce 1.4 percent more vehicles in the second quarter than in the year-earlier period. Not bad, but less than the 2.5 percent increase CSM had predicted a month ago. The redesigned Toyota Corolla, which reached dealerships in February, is easing somewhat the pain of weaker Tundra truck sales. As with other automakers, “even if there is weakness on one side, it’s compensated with something else,” Langley says. Nissan’s production slid 10.6 percent in the first quarter from the first quarter of 2007 but will rebound in the second quarter with an 8.1 per- cent gain from a year earlier, CSM predicts. CSM expects Nissan’s rising car output to make up for weak truck production. But Langley adds that CSM will be revising its forecast for Nissan. The carmaker said late last week that it had idled its Aguascalientes, Mexico, factory for seven days in March because of weak U.S. demand for the formerly strong Sentra and Versa cars built there. Honda holdout Honda remains a holdout from the production blues. The company is expected to increase second-quarter production 5.5 percent from a year earlier, in keeping with President Takeo Fukui’s position that the U.S. economy is not verging on recession. While most other automakers are slashing output of full-sized pickups and SUVS, Honda doesn’t make any of those. Its lineup is skewed toward cars — and fuel-efficient ones at that. “Obviously, there are many challenges in the market ahead,” said Honda spokesman David Iida. “But we feel we have products that are well-positioned to serve the needs of customers in the market right now.” c tric cars still suffer from a limited daily range. Several automakers, such as Mitsubishi, BMW, Nissan and Subaru, are considering “pure” electric vehicles, but none has been approved for sale in the United States. But California regulators want to force the issue. “We’re introducing a whole new category of vehicles to the public,” CARB Chairwoman Mary Nichols told The Associated Press. Mercedes names 27 AMG dealers Diana T. Kurylko dkurylko@crain.com consumer is going to have to bear the cost of these technologies for us to move forward. “ Ultimately, the What price? Hybrid vehicles are powered by a gasoline engine plus an electric motor. The gasoline engine can power the wheels, or it can recharge the battery pack that generates electricity for the electric motor. Unlike a conventional hybrid, a plug-in can be recharged overnight by hooking the batteries up to a power outlet. If the owner doesn’t drive more than 40 or 50 miles a day, a plug-in can run solely on its battery pack. General Motors plans to roll out the Chevy Volt in 2010, and it is developing a plug-in version of the Saturn Vue. Ford is testing a plug-in Ford Escape, while Toyota plans to roll out a plug-in version of the Prius. Lithium ion batteries are ideal for these plug-ins because they are smaller and lighter than the current DAVE BARTHMUSS GM ” nickel-metal hydride batteries. Lithium ion batteries would allow plug-in vehicles to travel further on pure electric power. Analysts have estimated the cost of the lithium ion battery pack for the Volt at about $10,000. Are consumers willing to pay thousands of dollars extra for a plug-in hybrid? “That’s the key question,” GM spokesman Dave Barthmuss said. “Ultimately, the consumer is going to have to bear the cost of these technologies for us to move forward.” c NEW YORK — Mercedes-Benz USA has appointed 27 dealers to open special AMG performance centers in the top-selling markets this year to promote the high-priced range of Mercedes vehicles. Steve Cannon, vice president of marketing, says that beginning in May, a road show of AMG cars will stop at each of the new performance centers to kick off marketing. Stores with performance centers — featuring a special display area and dedicated sales and service personnel — also will get a higher allocation of AMG vehicles and special-edition models, says Ernst Lieb, CEO of Mercedes-Benz USA. Mercedes is promoting AMG because the lowest-priced AMG — the new C63, based on the C class — goes on sale next month. It will cost $54,625, including shipping. “It represents a new entry into AMG with a price point we’ve never had,” says Cannon. At the other end, an exclusive SL65 black edition AMG comes toward the end of year and is expected to cost nearly $200,000. “It’s an ultralimited Ferrari killer — pure emotion and a pure image shaper,” says Cannon. The lowest-priced AMG — the new C63, based on the C class — goes on sale next month. The sticker: $54,625, including freight. Dealers opening the initial 27 performance centers — more will be appointed in 2009 — are being asked to send personnel to AMG headquarters in Germany for training and spend more on marketing, says Cannon. Mercedes-Benz USA is already the top market for AMG, selling about 50 percent of the 18,000 high-performance vehicles produced annually. Says Cannon: “We have a core of Ernst Lieb: Stores with performance centers will get a higher allocation of AMG vehicles and specialedition models. AMG owners, but there is a whole group of folks who we haven’t sufficiently introduced to the br

Table of Contents Feed for the Digital Edition of Automotive News - March 31, 2008

Axle strike leads GM to alter production plan Industry expert Ferron joins Automotive News Group Hummer adds E85 models Lear expands in China Ford spills the beans on car seats Concern ... confidence ... curiosity — welcome to America, Tata Expect most Ford-bred executives to stay put Tip for Tata: Let British brands be British brands Dana CEO sees need for growth in Asia Chrysler: Any deal for partner would be done by Cerberus Farley retools Flex marketing strategy Malibu attracts import-minded buyers European purchasing execs to suppliers: Costs must fall Reynolds removes dealership modems New Saturn ads will promote Aura, Vue, Outlook This Spring Hill launch is a fraction of the first one GM works on small global car Hal Riney, Saturn campaign creator, dies Dealer sours on China importer Secret computer lets Nissan planner peek into future XM-Sirius merger: Lower prices, more choices? Key Chrysler product developer resigns Ford's new boss in HR plans no major changes Wagener to replace Pfeiffer as Mercedes design chief It's time to break the glass ceiling Autos don't cause all global warming Toyota plumbed the depths of Scion Customer loyalty is serious business Future bright for Tata brands Dauch sends wrong signals as Axle strike drags Yanase opened Japan to Western cars Fewer dealers, sure, but more brands What if Ahn falls short? Want to inspire Lori Queen? Just say no Hanwha to build GM Powertrain assembly line Toyota enters untapped Korea, home of Hyundai James O'Rourke Jr. Picture This -- March 31st, 2008 Lexus pays dealers for innovations Suppliers to the 2009 Dodge Journey Ricardo center has battery focus Howa USA opens interior parts plant in Kentucky N.Y. show suggests a future of smart powertrains, muscle BMW sees new models as sales saviors Ford contract has unique take on core jobs 6 more PACE-setters in auto innovation Buy-here, pay-here may grow Dealers Mercedes SL: A fresh face — with 1 flaw Ex-Chrysler design chief John Herlitz dead at 65 Future could be bright for Jag, Land Rover Land Rover in good shape, but challenges remain Fuel economy fines loom for Tata As segment shrinks, Chrysler minivan output takes a big dip Mercedes names 27 AMG dealers Continental to cut jobs Cobalt SS price: $22,995 Kia opens Ga. training center Nissan idles Mexico plant Plastech legal bill: $1 million for a month Magna will add 3 plants in Mexico El Camino diehards say Pontiac G8 should have been a Chevy No 2nd chance for Nasser, other Ford alums Buick grabs a name from the past After short list, a short stay for Laymon Lori Queen or Ellery Queen? Daimler's mum on BMW Southern supplier strategy Tracing the Camaro's bloodline Alfa searches for a U.S. factory

Automotive News - March 31, 2008

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