Automotive News - March 17, 2008 - (Page 6)

6 • MARCH 17, 2008 Analysts: Lampert no threat to AutoNation Jim Henry autonews@crain.com Billionaire investor Edward Lampert has increased his ownership share of AutoNation Inc., the nation’s largest auto dealership group, to 36 percent from about 24 percent a year ago. Industry analysts say Lampert’s move appears to be an effort to buy low and wait for the company’s stock to bounce back. AutoNation’s share price hit a 52week low of $11.72 on Jan. 22. Its all-time high was close to $40 a decade ago. An AutoNation spokesman declined to comment on Lampert’s transactions. Lampert’s privately held investment firm did not respond to a request for comment. AutoNation, like other public dealership groups, has been stung by the slowdown in new-vehicle sales. The Fort Lauderdale, Fla., company depends heavily on markets in Florida and California, which are suffering from the bursting housing bubble. Since November, Lampert — a former AutoNation board member — and his ESL Investments Inc., of Greenwich, Conn., have bought about $323 million worth of AutoNation stock, according to public documents. During that period, AutoNation’s share price has fallen from just under $23 to around $14. In April 2006, as part of a larger stock buyback, Lampert sold AutoNation more than 20 million of its own shares at $23 a share. Lampert, 45, is chairman of Sears Holding Corp. Last year, he stepped down after five years as an AutoNation board member. He is represented on AutoNation’s board by William Crowley, president of ESL Investments and CFO of Sears Holding. Rick Nelson, an auto industry analyst for Stephens Inc., said Lampert “seems to have his hands full at Sears.”c Analysts say Edward Lampert appears to be buying low in hopes that AutoNation’s stock eventually will bounce back. Stadler: Before Audi decides to build a vehicle in the U.S., it must determine which vehicle to make and whether it can be exported worldwide. Stadler: Audi considers U.S. plant Audi AG is in the early stages of deciding whether to build vehicles in the United States, CEO Rupert Stadler says. If Audi chooses to assemble vehicles here, it must decide whether to share a plant with the Volkswagen brand or build its own factory. Equally important, Stadler says, is which vehicle would be built in the United States and whether it could be exported worldwide. VW is in the final stages of selecting a U.S. factory site. It is expected to announce a site in the Southeast by June. Stadler answered questions in a conference call last week with U.S. journalists after Audi held a financial press conference in Germany. Audi is considering U.S. production because it wants to boost sales here to 200,000 units by 2018 — part of the Volkswagen group’s plan to increase sales to 1 million units in the United States in 10 years. This year, Audi aims to sell 100,000 units in the United States, up from 93,506 units last year — an increase of 3.8 percent from 2006. — Diana T. Kurylko Toyota sees its first checkered flag as sign NASCAR’s paying off Mary Connelly mconnelly@crain.com A pickup may figure in Kia’s future Kathy Jackson kjackson@crain.com Toyota’s first victory in a NASCAR Sprint Cup race is the payoff of a long-term plan to build brand awareness through stock car racing, the company says. Toyota cars took first and second place in the Kobalt Tools 500 at Atlanta Motor Speedway on March 9. Before that, no import brand had won a Cup race in more than a half-century. Les Unger, national motorsports manager of Toyota Motor Sales U.S.A. Inc., says the company seeks to “expand our brand impact, particularly in the full-sized truck market in the Midwest, the Southeast and Southwest.” “And quite a few NASCAR races fall in those geographic areas,” Unger told Automotive News. Toyota entered NASCAR stock car racing last year. Toyota also competes in NASCAR’s Crafts- man Truck Series. Toyota is advertising the victory in five publications, including Automotive News. “We want to get the word out to a broader audience,” Unger says. He declined to disclose Toyota’s investment. But he says the brand is in for the long term. “We knew it would take a while to become competitive,” Unger says. “We had new teams, new drivers, new cars, new engines. And we were competing with teams who have been out there for 20 to 30 years.” The marketing return has been worth the investment, Unger adds. “You build rapport by showing up not only on the track but also at the display area and in the manufacturer midway and by running promotions through the dealerships. It is something you build on over time.” c Kyle Busch celebrates his victory — Toyota’s first NASCAR win — at the Kobalt Tools 500 on March 9 in Atlanta. ASP INC. Another General charges into electric cars Leslie J. Allen lallen@crain.com General Electric recently invested $4 million in Norwegian electric carmaker Th!nk Global, whose vehicles have included the Public, shown. General Electric is throwing some of its financial might behind electric cars. GE has invested more than $20 million in a leading producer of lithium ion batteries, A123 Systems Inc., and it recently pumped $4 million into electric carmaker Th!nk Global, of Oslo, Norway. A123, of Watertown, Mass., is one of two U.S. battery suppliers for the pureelectric Th!nk City vehicle, which has a range of 124 miles. The other supplier is Indianapolis-based EnerDel Inc. The Th!nk City is 123 inches long, about 17 inches longer than a Smart ForTwo. The car is expected to arrive on the Norwegian market by this summer. Th!nk, which was owned by Ford Motor Co. from mid-1999 until January 2003, is hoping to sell the City in the United States. Spokeswoman Ingvil Ladehaug said Th!nk will open sales offices in northern California and in the United Kingdom. GE Energy Financial Services, an arm of GE, said the investments are part of an effort to help customers meet environmental challenges while expanding GE’s clean-energy portfolio. A123 is working with General Motors to develop lithium ion batteries for GM’s electric E-Flex architecture, which would power vehicles such as the Chevrolet Volt. c Douglas A. Bolduc contributed to this report LOS ANGELES — Kia appears close to a decision to build a pickup for sale in the United States. Planning for a truck has long been in the works and was a subject that new Kia Motors America CEO Ahn ByungMo broached with dealers in February. Kia showed a V-6-powered mid-sized pickup concept called the Mojave at the 2006 Chicago Auto Show. Now, a source familiar with the company’s plans says a pickup is approved for production at Kia’s new plant in Georgia. He says the midsized truck will be based on the redesigned 2010 Sorento SUV. The Sorento, now a body-on-frame truck, will be converted to a unibody platform when the new version goes into production in West Point, Ga., in November 2009. The Sorento will be the first vehicle produced at the plant. The source said the pickup will be added at West Point about two years after the Sorento. It will use a frontwheel-drive, unibody platform and will be powered by a V-6 engine. Ahn “is really pushing the truck,” the source said. Ahn replaced Len Hunt as CEO of Kia Motors America on Feb. 8. Ahn talked about a pickup with the Kia dealer council in February, said council Chairman Bob Hogan. “He danced around it, but he left the door open that there is a distinct possibility we could get it,” said Hogan, a dealer in South Carolina. “They had the Honda Ridgeline there. He said they were looking at models like the Ridgeline.”The fwd Ridgeline sits on a unibody platform. “From a product perspective,” Hogan said, “the number-one choice of the dealers is a pickup.” Erich Merkle, an automotive forecaster at IRN Inc., said the research group expects Kia to build a pickup at the new plant. “We’re not talking big volumes,” Merkle said, “but it could add another 50,000 to 55,000 units.” c Kia’s inspirations for a new unibody pickup include the Honda Ridgeline.

Table of Contents Feed for the Digital Edition of Automotive News - March 17, 2008

Leases grow as alternative to long loans Toyota dealers balk at upgrades Up for grabs: China importer Testing Chevy's Camaro Escalade first vehicle to get full LED headlamps Hoops fans take a shot at China Toyota will cut Tundra, Sequoia production F-150's risk-reward strategy: Ramp up before the revamp As UAW, American Axle talk, CEO Dauch in Fla. Ex-GM purchasing executive indicted Court allows higher Plastech credit line Saab sticker prices rise as sales fall; will U.S.-built 9-7X offset losses? VW plant capacity in U.S.: 250,000 units Bad cruise control switch haunts Ford Continental plans to bring r&d in-house Rieter expects to increase its global footprint Stadler: Audi considers U.S. plant Another General charges into electric cars Toyota sees its first checkered flag as sign NASCAR's paying off A pickup may figure in Kia's future Analysts: Lampert no threat to AutoNation More likely to be spent to keep suppliers alive in '08 2 suppliers plan Alabama plants UAW seeks job guarantees to end American Axle strike Revolving door continues to spin at Nissan GM, top marketers to share research Electric power steering is grabbing the wheel Delphi completes sale of interiors unit to Renco Mercedes again is true-luxury king How electric power steering works It's time for dealer-factory collaboration Ford must close stores but remain open to diversity The small print Here's a question for Obama, Clinton Didn't you ever hear of a halo? Hurray for affordable performance cars Politics can age a car overnight Good for planet, good for GM What 'scientific consensus'? Lutz may be right but said it wrong Lutz had the courage to tell the truth Big Apple isn't very green 23 finalists in running for PACE honors Canada sales up 14.5% in Feb. RV shipments drop 7.1% in Jan. Wagoner: No sure thing on state air rules Conquest sales, Asia growth boost ADP Brockman: Reynolds focuses on service OEConnection links to ADP Geneva goings-on Judge: Dealer suit over transfer of GM franchise can proceed Honda will build Ridgeline in Alabama So who's running the show at Chamco? GM seeks Plastech tooling Federal-Mogul reports gains Chrysler sells plant to Fiat BMW's new sales boss Odell is named COO at Ford of Europe Strike dents GM truck output Tony Stewart blows a gasket Illingworth leaving — and staying with — Toyota A note to eager auto execs: Invaders sometimes get icy reception in Russia Hush, hush: Baby Nason on board For rent: Ford's PAG palace on the West Coast Chrysler cuts Calif. studio

Automotive News - March 17, 2008

For optimal viewing of this digital publication, please enable JavaScript and then refresh the page. If you would like to try to load the digital publication without using Flash Player detection, please click here.