Automotive News - November 3, 2008 - (Page 3)

NOVEMBER 3, 2008 • 3 83rd year — No. 6332 A dealer — and his reputation — on the ballot Suits against auto group heat up Florida campaign Harry Stoffer hstoffer@crain.com Battleground Florida’s 13th Congressional District, where dealer Vern Buchanan is running for re-election to the U.S. House of Representatives. Ford to spend $200 million to upgrade 2 Ky. plants DETROIT — Ford Motor Co. plans to spend $200 million at its two Louisville, Ky., assembly plants to prepare them for new vehicles. Ford will spend $100 million at Kentucky Truck to transfer production of the Ford Expedition and Lincoln Navigator from the Michigan Truck plant in suburban Detroit, Ford said Friday. Ford makes F-series Super Duty pickups at Kentucky Truck. Ford will spend $100 million at Louisville assembly. The automaker intends to produce undisclosed small cars there, she said. The plant now builds the Ford Explorer and Mercury Mountaineer SUVs. — David Barkholz The economy and the war are important, of course. But in Florida’s 13th Congressional District, a raft of lawsuits against Rep. Vern Buchanan and his big auto dealership group is a defining campaign issue. Buchanan, a first-term Republican from Sarasota, is one of two auto dealers in Congress and among its wealthiest members. But political opponents and newspaper reports suggest that his rags-to-riches resume is tarnished. Buchanan’s Democratic chal- A spot opposing Rep. Vern Buchanan focuses on allegations in lawsuits against him and his auto group. lenger in this week’s election says charges at the heart of lawsuits against Buchanan Auto Group dealerships reflect badly on the lawmaker’s character. The suits allege abusive finance and insurance practices, campaign donations coerced from dealership employees and re- Sarasota “I absolutely have made character an issue, as it should be,” says Christine Jennings, who lost to Buchanan by 369 votes two years ago amid charges of voting irregularities that ultimately were dismissed. Buchanan’s supporters say the accusations in the lawsuits are part of a politically motivated smear campaign. For his part, Buchanan says he is removed from daily operations at his 16 dealerships. Buchanan, 57, declined to be interviewed by Automotive News last week. A spokeswoman said Buchanan was too busy campaigning. Recent polls suggest that Buchanan has a comfortable lead over Jennings, a former bank presisee BUCHANAN, Page 38 taliation against would-be whistleblowers. UAW hires bailout adviser The UAW has hired veteran Wall Street consultant Stephen Girsky to advise the union on a possible tie-up between General Motors and Chrysler LLC, Automotive News learned Friday. Girsky, 46, is a former senior auto analyst with Morgan Stanley. He also has been an adviser to GM CEO Rick Wagoner, and was an adviser in 2007 to Centerbridge Partners LP when the private equity group made a pitch for Chrysler during its sale by Daimler AG. — David Barkholz again in the United States is not realistic. “ To do the Galant Help vehicles shed pounds Weight matters. Reducing weight is high on the list of ways to improve vehicle fuel efficiency. How to do so will be a prime topic at the first Automotive News Green Car Conference and Exhibition on Nov. 13 in suburban Detroit. Representatives of the steel, aluminum and plastics industries will explain how their products can help cut pounds from cars. Those speakers are: Karla Butler, director for the Americas, DuPont Automotive Performance Materials. Rick Winter, operations director for development, Alcoa Technical Center. Blake Zuidema, director of automotive product applications, ArcelorMittal. In addition, Kyle Williams, director of automotive systems integration at Robert Bosch LLC, will join a “rest of the car” panel to discuss trimming energy use in ways that don’t actually move the vehicle. BorgWarner Inc. CEO Tim Manganello will join a panel on powertrains of the future to discuss improving powertrain efficiency. The conference also will offer a product showcase of green vehicles, parts and technology. And Automotive News will present its first PACE Environmental Awards. c OSAMU MASUKO Mitsubishi ” ArvinMeritor reviews spinoff DETROIT — Supplier ArvinMeritor Inc. said Friday it is reviewing alternatives to a planned spinoff of its light-vehicle unit to shareholders because of tough market conditions. The supplier said it was investigating other options to separate the business including a sale, but the spinoff remained an option. ArvinMeritor also said it was reducing its global work force by 1,250 employees or about 7 percent. The supplier said most of the cuts of 450 salaried and 800 hourly workers have been completed. — Reuters Mitsubishi CEO Osamu Masuko is looking toward a model mix that will make the Normal plant profitable. Mitsubishi CEO: Let’s halt Galant production in U.S. Masuko wants Normal plant to build small cars for export Hans Greimel hgreimel@crain.com Commercial i MiEV in the works ➤ 40 place it when it’s time to design a successor. At the Normal plant, Masuko wants to produce vehicles “that can be sold on the global market. We cannot think about extending our business as it is right now because we won’t be able to secure the volume we want in the U.S.” Speaking through an interpreter, Masuko said his company hasn’t made any decisions. But bringing Lancer or Outlander production to the Illinois plant is one option because those vehicles already are sold globally. The Normal plant now makes the Galant sedan, Eclipse coupe and Spyder and Endeavor crossover. The plant has a capacity of 240,000 vehicles a year but can turn a profit at 100,000. To make better use of the factory, Mitsubishi has been exporting the Galant and Eclipse. But Normal is American Axle posts loss DETROIT — Steep drops in automotive production along with special charges helped push American Axle & Manufacturing Holdings Inc. to a third-quarter net loss of $440.9 million, compared with net income of $13.5 million for the same period a year earlier. The supplier’s results include $398 million in one-time charges. Revenue for the quarter fell to $528.1 million from $774.3 million a year earlier. In an earnings call on Friday, American Axle CFO Michael Simonte said the company is “on track to (achieve) $300 million in cost reductions in 2009, but not much has flowed in labor cost savings in the third quarter.” — Robert Sherefkin TOKYO — Mitsubishi CEO Osamu Masuko wants to kill Galant production in the United States. In its place, Masuko plans to produce small cars suitable for export at the company’s unprofitable factory in Normal, Ill. Mitsubishi Motors Corp. also is considering moving production of the Lancer small sedan and Outlander crossover to the plant, he told Automotive News here Friday. In October, the beleaguered Normal factory received a four-year extension after Mitsubishi and the UAW signed a labor deal to keep it open. Masuko is now figuring out what model mix will make the plant profitable after years of running below capacity. “To do the Galant again in the United States is not realistic,” the Mitsubishi chief said. The most sensible plan for the sedan is not to kill the Galant midcycle, he said, but to re- still working below the 100,000-unit breakeven point. Through September, Mitsubishi’s U.S. sales were down 24.3 percent to 80,105 vehicles. The drop was far worse than those of the automaker’s Japanese rivals and is among the industry’s worst. Mitsubishi needs more small cars in the United States to tap demand for fuel-efficient vehicles and meet the federal government’s new fuelefficiency rules, Masuko said. The Mitsubishi CEO said he wishes the company’s compact Triton pickup were still being exported to North America. The current generation is built in Thailand and sold in more than 100 countries. “I wish I had that in the United States right now,” Masuko said, adding there are no immediate plans to reintroduce it. Said Masuko: “Even in this economic environment, it would be selling well.” c The green scene What: Automotive News Green Car Conference/Exhibition When: Thursday, Nov. 13 Where: Rock Financial Showplace, Novi, Mich. Cost: $795, or $675 for Automotive News subscribers To register: www.autonews.com/green Questions: green@autonews.com Host sponsor: Ernst & Young http://www.autonews.com/green http://www.autonews.com/green

Table of Contents Feed for the Digital Edition of Automotive News - November 3, 2008

Credit? Come and get it, industry groups say GM's product delays signal dire health Ford sticks with small-car plans Mitsubishi CEO: Let's halt Galant production in U.S. A dealer â and his reputation â on the ballot Help vehicles shed pounds American Axle posts loss UAW hires bailout adviser Ford to spend $200 million to upgrade 2 Ky. plants No off-lease cars? Certified will find others Arlena Sawyers China's stock market plunge has spooked car shoppers Advantage, Ford: Mulally likes owning Ford Credit Supplier execs join innovation panel at congress Quietly, Mini seeks 500 drivers to lease electric car for a year Reynolds bolsters document business Winterkorn: Audi needs to build in U.S. The great revenue drop of 2008 Bidders bet they can rebuild Heard 1 size fits all NADA: Give us tax incentives, dealer loan guarantees Campaigns' climate, energy plans hit economic wall Detroit 3 need and deserve U.S. help now Chrysler needs a buyer, but not GM Dealers pay fair share of taxes Washington hurts, not helps, electrics Compressed natural gas is the best fuel New ads aim to raise Suzuki's low profile Suzuki's new ad strategist: This brand has soul Fuel efficiency is coming â it just takes time Electrics edge closer by 2010 Tougher CAFE standards loom R&d chiefs shift gears for an electric future Japan carmakers lead charge into electrics Buffett backs BYD's sketchy plan for U.S. electric car Q&A: BYD envisions 2010 exports to U.S., Europe Girding the power grid for an electric fleet Hype powers plug-in vehicles Coachbuilders see salvation in electric cars Electric vehicles are charging into Europe Expect stop-start's big start to arrive in 2010 Flexibility will help Honda survive the storm Nardelli: Bailout not perfect â but needed Audi goes high-tech to boost service Acura offers quick service to win business Toyota's fashion fan Picture this Hondaâs N.A. operating profit falls 80.6% in quarter Aug. RV shipments fall 44% VW drops hints about car for new Tenn. plant Mexico sales fall 10.7% in September Honda to boost CR-V, end Civic output in Ohio Ford and GM jockey for steel discounts Dealers Ford Credit seeks to tap $700 billion package GM will end a used-car incentive early Nissan, Mitsubishi, Mazda recast fiscal 2009 forecasts Metaldyne to bondholders: Take 30% or Chap. 11 looms Detroit 3 ties hurt profits of dealer groups GM takeover would eviscerate Chrysler ranks, model lineup Mitsubishi plans electric hauler To match Toyota, Nissan offers 0% loans Sticker, sticker at the mall, what's the cheapest of them all? The Versa Waiting is what it's all about, Alfa Buy Chrysler? GM should sell Buick to SAIC Pickups pumped up by pump price plunge Chrysler hybrids, we hardly new ye Ghosn: Your best partner is a president in your pocket Sonic wins, but Mercedes wants last word

Automotive News - November 3, 2008

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