Automotive News - August 4, 2008 - (Page 3) AUGUST 4, 2008 • 3 82nd year — No. 6319 Ford merges brands’ sales, marketing DETROIT — Ford Motor Co. consolidated sales and marketing for Ford division, Lincoln and Mercury on Friday, two executives close to the automaker told Advertising Age, another Crain Communications publication. In a cost-cutting move, the staff will be aligned by vehicle type and have responsibility for models in that category from all three brands, the executives said. Ford traditionally had an executive overseeing all three brands for North America but maintained separate sales and marketing groups. A Ford spokesman would not comment. — Jean Halliday Lincoln reworks bonus plan for dealers Amy Wilson awilson@crain.com Workers in Japanese automakers’ U.S. plants, including Nissan’s factory in Smyrna, Tenn., above, generally have been spared employee reductions — until now. Mitsubishi changes dealer advisory board LOS ANGELES — Mitsubishi is restructuring its dealer advisory board. During a conference call last week, members were told that the 12-member board elected by peers would be replaced by a six-member board, three chosen by the company and three elected by dealers. Board members who did not want to be identified said Mitsubishi is making the changes because of negative survey results the board has received. Spokesman Dan Irvin confirmed that the board is being restructured but said he had no details. — Kathy Jackson Pain spreads beyond Detroit: Nissan offers employee buyouts April Wortham awortham@crain.com Truck travails Nissan says the “dramatic slowdown” in sales of full-sized trucks and SUVs was a major factor in its decision to offer buyouts to about 1,200 workers at factories in Smyrna and Decherd, Tenn. JULY ’08 SALES CHANGE VS. JULY ’07 GM repeats employee discount program DETROIT — General Motors will repeat, for two weeks, a program that lets employees pass along an employee discount to one friend or family member. Mark LaNeve, GM’s North America vice president of sales, service and marketing, said the first program, which ran from July 25 through Thursday, July 31, moved 4,000 to 5,000 vehicles. — Richard Truett CLARIFICATION A Late News item on Page 3 of the July 21 issue stated that the South Carolina Department of Insurance was seizing the assets of Heritage Warranty Risk Retention Group Inc. The item should have noted that the company, which insures vehicle service contracts, is still authorized to do business. A June 30 letter from the Insurance Department said it “has not taken any action that would impair any of Heritage Warranty’s existing contracts.” Japanese carmakers have staked their reputations on shielding U.S. workers from bumps in the marketplace. Yet there was Nissan last week looking a lot like one of those downsizing Detroit 3 companies. Nissan offered to buy out about 1,200 hourly and salaried employees at its Tennessee factories, blaming slow sales of full-sized pickups and SUVs. The offer was out of character for a Japanese automaker — and much different from the way Toyota has dealt with the same grim market conditions. Nissan’s voluntary buyouts will span three years and cut the Tennessee work force by 18 percent. Lump-sum payments of up to $125,000 have been offered to technicians and salaried employees at its Smyrna assembly and nearby Decherd powertrain plants. The Smyrna plant also will eliminate night-shift truck production effective Aug. 11. So is it the end of an era in Japanese employee relations? “This is an important symbolic moment,” says labor expert Harley Shaiken, a professor at the University of California-Berkeley. Shaiken says the cuts underscore the severity of the current auto crisis and show that transplant manufacturers are not immune from the same problems that plague Detroit. “Even though these buyouts are far smaller than what’s taking place with the Detroit 3, for the Nissan worker there’s the sense of ‘How much are we getting and what does that mean?’ ” he said. Armada *Frontier *Pathfinder Quest Titan *Xterra Total U.S.-built trucks *Produced in Smyrna Source: Nissan North America 1,699 6,627 4,711 3,010 3,972 4,898 24,917 –23.4% 24.3% –4.5% 15.5% –30.4% 17.5% –0.2% Nissan: We must compete ➤ 24 have twice voted down the UAW, in 1989 and in 2001. In the 1990s, the UAW abandoned two other efforts to organize the Smyrna plant because of lack of support. “As a union member, contractually, I know what my rights are,” said O’Rourke. “Unfortunately, at Nissan, they don’t know what the bottom is. And they’re afraid.” O’Rourke said the UAW has organizers at Nissan’s Smyrna and Decherd factories. Local 1853 is an amalgamated union that represents 5,200 workers at GM’s Spring Hill factory (formerly Saturn) and Johnson Controls Inc.’s factory in Columbia, Tenn. Says Shaiken: “Does it give the union an opening? Yes. Is that opening likely to be realized in a big way anytime soon? Probably not.” Nissan sold 116,129 U.S.-built trucks in the United States from January through July, down 35.4 percent from the same period of 2007. This isn’t the first time Nissan has pared its U.S. work force as a result of softening sales. In March 2007, about 775 workers at the two Tennessee plants took voluntary buyouts of $45,000 cash, plus $500 for each year worked. The Smyrna factory employs about 5,500 hourly and salaried workers producing the Frontier pickup, Xterra SUV, Maxima sedan, Pathfinder SUV and Altima ‘They’re afraid’ Said Mike O’Rourke, president of UAW Local 1853 in Spring Hill, Tenn.: “In their employee meeting, one of the employees said, ‘If we don’t go, are you going to reduce our wages?’ And management wouldn’t answer. I think you and I both know the answer to that question.” Workers at the Smyrna plant CORRECTION A Page 1 story in the July 28 issue named a wrong plant for Toyota Corolla production. Besides New United Motor Manufacturing Inc. in Fremont, Calif., the car is built at Toyota’s Cambridge, Ontario, plant. sedan, coupe and hybrid. The Decherd factory, with about 1,100 employees, supplies four-, sixand eight-cylinder engines to the Smyrna factory and Nissan’s Canton, Miss., assembly plant. The buyouts last year went largely unnoticed by the industry. Nissan has never laid off workers in its North American factories. “They’re not the first set of buyouts for Nissan, and they’re not layoffs,” Shaiken said, “but they are an indicator that tough economic times affect all automakers.” Nissan says the buyouts won’t affect workers at its Canton factory, where production is more heavily weighted toward trucks than at Smryna. In June, Nissan dropped one of two shifts from Canton’s Titan pickup and Armada SUV line. A third shift of Altima production will be added in Canton next month. Nissan plans to discontinue making the Titan in Canton in 2011 when Chrysler will begin making Nissan-badged trucks in Mexico. Nissan also plans to discontinue building the Quest minivan and Infiniti QX56 in Canton and assemble light commercial vehicles there instead beginning in 2010. Nissan North America Inc. spokesman Fred Standish said that the attrition rate at Canton makes buyouts there unnecessary see NISSAN, Page 28 DETROIT — Lincoln is retooling a bonus program for its financially struggling dealers instead of scrapping it as previously scheduled. The bonus program will be structured differently from recent years, but the result is the same: Including holdback, Lincoln dealers will get 4 percent of a vehicle’s price paid to them. Half of that previously had been paid as a special bonus slated to end after the 2008 model year. Michael Adamson, chairman of the Lincoln Mercury national dealer council, praised Ford Motor Co. executives for their decision to continue the assistance. “A lot of the dealers really rely on it to keep them in the black instead of the red,” said Adamson, dealer principal of Adamson Lincoln-Mercury in Rochester, Minn. For the 2009 model year, the bonus program is now called the Lincoln Growth Incentive. To fund the program, all 2009 Lincolns will get a 1 percent increase in their wholesale delivery price, according to a memo distributed to Lincoln dealers in July. The bonus payment to dealers is 1 percentage point of the vehicle’s base sticker price. A Ford Motor executive confirmed the memo. Despite the reworked structure of the program, the decision means that “pretty much everything remains as is,” spokeswoman Marisa Bradley said. The prior structure was enacted after Ford Motor in 2005 scrapped bonuses connected to its Ford brand Blue Oval dealership certification program and corresponding programs for Mercury and Lincoln. Certification was not required for the expiring Lincoln bonus program, nor is it necessary for the 2009 model year program, according to Ford Motor. Said Adamson: “It’s a win-win.” c PACE Awards open for innovative suppliers Auto suppliers have until Sept. 12 to apply for the 2009 Automotive News PACE Awards. The awards — co-sponsored by Ernst & Young and the Transportation Research Center Inc. — recognize suppliers for innovation. This will be the 15th year for the awards. Independent judges will recognize achievement in these categories: product, productEurope, information technology and services, and manufacturing process and capital equipment. There also is an open category. Winners will be announced April 20 at a ceremony in Detroit. The Automotive News PACE Awards program is open to all automotive suppliers. PACE is short for premier automotive suppliers’ contribution to excellence. The application fee is $995. To apply online or to download an application, visit www.autonews.com/pace. Questions? Call 313-446-6039. c http://www.autonews.com/pace
Table of Contents Feed for the Digital Edition of Automotive News - August 4, 2008 Automotive News - August 4, 2008 Losing leases: It hurts already Crisis at Chrysler: Buyers bail GM's really bad news: Its revenue Lincoln reworks bonus plan for dealers Pain spreads beyond Detroit: Nissan offers employee buyouts Mitsubishi changes dealer advisory board GM repeats employee discount program Ford merges brands' sales, marketing After 5 funky years, Toyota's Scion now finds itself in a funk It's a body, er, a bus by Fisher At Tech Center, form follows function Industry nemesis again turns up heat on climate Right products, diverse customers raise suppliers' profits Last-minute leases swamp Chrysler With leases off the table, Chrysler offers new sales incentives GM favors 4 endorsed vendors of dealer management systems GKN to supply F-150 FX4's differential For sale: 2 Metaldyne plants 1 week's notice: Chrysler dealers deserved better Get used to the roller coaster That 1934 Reo had a clutch pedal We sell what the public wants Decision makers can't use hindsight Detroit's truck trauma is self-inflicted Why won't consumers buy Detroit cars? Speaking of ads, don't overlook VW Software helps dealers manage parts Service survey: Customer satisfaction rises Researcher: Vehicles can prevent crashes Personnel Microsoft will offer Live Search Dealers Picture This Nissan offers buyouts to its Tenn. workers Lincoln-Mercury exec joins Kia Kaline out at Ford Penske earnings drop slightly Asbury will move; profits slip S&P downgrades American Axle Best sales news: July is over Now THAT'S resale value ... Sirius-XM satellite radio deal: A mixed bag Don't be misled by Chery's sales; it's a key player McCurdy applies some political (tire) pressure A star is born: The saga of the shrinking sticker Our flag is still there Obama-mobile? Or McCain-carrier? Automotive News - August 4, 2008 Automotive News - August 4, 2008 - (Page Intro) Automotive News - August 4, 2008 - GM's really bad news: Its revenue (Page 1) Automotive News - August 4, 2008 - GM's really bad news: Its revenue (Page 2) Automotive News - August 4, 2008 - Ford merges brands' sales, marketing (Page 3) Automotive News - August 4, 2008 - After 5 funky years, Toyota's Scion now finds itself in a funk (Page 4) Automotive News - August 4, 2008 - After 5 funky years, Toyota's Scion now finds itself in a funk (Page 5) Automotive News - August 4, 2008 - Right products, diverse customers raise suppliers' profits (Page 6) Automotive News - August 4, 2008 - Right products, diverse customers raise suppliers' profits (Page 7) Automotive News - August 4, 2008 - With leases off the table, Chrysler offers new sales incentives (Page 8) Automotive News - August 4, 2008 - With leases off the table, Chrysler offers new sales incentives (Page 9) Automotive News - August 4, 2008 - For sale: 2 Metaldyne plants (Page 10) Automotive News - August 4, 2008 - For sale: 2 Metaldyne plants (Page 11) Automotive News - August 4, 2008 - Decision makers can't use hindsight (Page 12) Automotive News - August 4, 2008 - Decision makers can't use hindsight (Page 13) Automotive News - August 4, 2008 - Speaking of ads, don't overlook VW (Page 14) Automotive News - August 4, 2008 - Service survey: Customer satisfaction rises (Page 15) Automotive News - August 4, 2008 - Personnel (Page 16) Automotive News - August 4, 2008 - Dealers (Page 17) Automotive News - August 4, 2008 - Dealers (Page 18) Automotive News - August 4, 2008 - Picture This (Page 19) Automotive News - August 4, 2008 - Picture This (Page 20) Automotive News - August 4, 2008 - Picture This (Page 21) Automotive News - August 4, 2008 - Picture This (Page 22) Automotive News - August 4, 2008 - Picture This (Page 23) Automotive News - August 4, 2008 - Nissan offers buyouts to its Tenn. workers (Page 24) Automotive News - August 4, 2008 - S&P downgrades American Axle (Page 25) Automotive News - August 4, 2008 - S&P downgrades American Axle (Page 26) Automotive News - August 4, 2008 - Best sales news: July is over (Page 27) Automotive News - August 4, 2008 - Best sales news: July is over (Page 28) Automotive News - August 4, 2008 - Best sales news: July is over (Page 29) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 30) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 31) Automotive News - August 4, 2008 - Obama-mobile? Or McCain-carrier? (Page 32)
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