Automotive News - March 3, 2008 - (Page 54)

54 • MARCH 3, 2008 final assembly comment GENEVA COVERAGE >> Get the latest news this week from the Geneva motor show at www.autonews.com/geneva. ISTOCKPHOTO Honda moves its American bike offshore Y ou meet the nicest people on a Honda. That was probably true in the early 1960s when Grey Advertising came up with that tag line for Honda commercials. Back then, Honda was selling mostly little motorbikes with 50cc engines. The Beach Boys even did a song called “Little Honda,” proclaiming that the groovy little motorbike was “more fun than a barrel of EDWARD LAPHAM monkeys.” IS EXECUTIVE Obviously, EDITOR OF times changed. AUTOMOTIVE Motorcycles NEWS. got bigger and Honda started building them in Marysville, Ohio, three years before the company cranked up car production in America. That motorcycle factory is what made Honda a naturalized U.S. citizen. The big Honda Gold Wing cruisers assembled in Ohio gave the brand more horsepower as a full-line producer. So it’s too bad the company will stop making bikes there next year. Honda says it is reorganizing production of its large- and medium-sized motorcycles into a new factory in Kumamoto, Japan, which will be a more efficient way to produce modern motorcycles for global markets. That’s probably true. But offshoring its U.S. motorcycle output will ding the brand here. Some U.S. bikers will care. Honda never developed the icon status of Harley-Davidson in America, but the brand has a following. Honda is known for selling well-built motorcycles and finding plenty of glory in racing. More than anything else, Honda is motorcycles. Honda began as a motorcycle producer in Japan long before cars, generators, lawn mowers, power washers and jets entered the picture. Honda came to America selling bikes. The words “Honda” and “motorcycle” are interchangeable in most developing economies. My first bike was a Honda — a used 1965 305 Superhawk CB77 built in Japan. Heck, just about everybody’s first bike was a Honda. I know guys who work for one of the Detroit 3 but still ride Honda Gold Wings because the bikes were made in America. I wonder what they’ll buy next time. Edward Lapham writes five commentaries each week for autonews.com. Read them at autonews.com/edwardlapham. Tom LaSorda’s multimilliondollar smile I f Tom LaSorda has been smiling more lately, Daimler’s annual report may hold the explanation. The Chrysler LLC co-president guided Chrysler through the divorce from Daimler and into the arms of Cerberus Capital Management — and got paid handsomely for his efforts. Many thought LaSorda would leave Chrysler after Cerberus brought in Bob Nardelli last summer to replace him as chairman and CEO. But LaSorda, a manufacturing veteran who is much respected by Chrysler dealers, suppliers and line workers, has stayed on. Last week Daimler revealed in its 2007 annual report that LaSorda got a tidy $15.8 million bonus for helping guide the Chrysler sale. That was in addition to the $3.2 million he received for his service on the management board of what then was known as DaimlerChrysler. LaSorda left DaimlerChrysler’s board last summer along with former Chrysler COO Eric Ridenour, who received an $8.2 million compensation package. Ridenour has since left the company. Maize malaise stalls ethanol oaring corn prices are pushing investors off the ethanol bandwagon. Agribusiness giant Cargill is the latest to step back, suspending plans last week for a $200 million ethanol plant near Topeka, Kan. “It’s basically the cost of corn going in versus the price of ethanol you get going out,” Cargill spokesman Bill Brady told Automotive News. Cargill isn’t alone. According to a February report in Fortune, plans for as many as 50 ethanol plants have been scrapped or delayed in recent months. For the reason, one doesn’t have to look past the cornfield. Futures prices now top $5 a bushel, compared with about $2 in mid-2006. Jay O’Neil, an agricultural economist at Kansas State University, told the Associated Press that he expects a shakeout in the ethanol market: “They are going to struggle,” he said of ethanol producers. “You will see a consolidation in this process. Some will go out of business.” S LaSorda: A well-paid matchmaker EU wants CO2 in ads; battle loomsutomakers and ad agencies are crying foul over a proposal by the European Union that would require auto ads to contain data about fuel economy and CO2 emissions. “I am amazed at this strange intrusion into business communications within the context of a free-market economy,” said Dieter Dahlhoff, a marketing instructor and former head of marketing at Volkswagen. The plan would require auto ads to include a vehicle’s CO2 emissions and fuel consumption. At least 20 percent of the ad space would have to be devoted to the information. Jochen Sengpiehl, head of advertising at VW, says the proposal “would amount to censorship.” Holger Jung, head of an ad industry trade group, said: “Now is the time for the auto industry, the media and the communications agencies to close ranks.” Taking a page from the playbook of General Motors Vice Chairman Bob (“Global Warming is a Total Crock”) Lutz (see commentary, Page 14), a German adman whose agency represents Audi wailed: “In the future, will we see the CO2 emissions of a cow on advertisements for meat?” The cycle line in ’79: Honda’s first foray into the United States. Honda will recycle cycle plant Sell enough little engines, and you get a ride from some big ones. G oodbye, Gold Wing, hello, … what? Honda, which began U.S. manufacturing in 1979 with a motorcycle plant in Marysville, Ohio, will end cycle production there in the spring of 2009 and is studying options for the space. The cycle plant, which also has made auto parts for a few years, is one-tenth the size of the car plant next door, which opened in 1982 and today builds the Honda Accord and the Acura TL and RDX. That makes the cycle plant too small to build the hot-selling subcompact Fit but it might be the right size for, say, hybrid powertrains for the Civic. That would be a nice bit of in-your-face-manship aimed at Toyota, which imports all its hybrid powertrains. Or maybe the plant will just make more parts. Says Honda: Wait and see. A tale of 2 exhaust systems T oyota says a pilot program to reward Swedish dealers who sell the most low-emissions cars may be extended to other European markets. Ulf Winberg, head of Toyota Sweden, said building fuel-saving cars isn’t enough to cut CO2 emissions: “The other half is to have the salespeople effectively promote” them. So last year Toyota gave 35 Swedish dealers and 35 salespeople a trip to Brazil, the world’s ethanol mecca, for selling the most low-CO2 cars. (Sweden is Europe’s leading country in terms of E85 use, but Toyota doesn’t sell E85 models in Europe.) Thanks to dealer incentives, Toyota Sweden cut 2007 fleet CO2 grams-per-mile emissions 5 percent from 2006. The dealership incentive program is back this year, but Toyota hasn’t decided on the prize — perhaps because it’s crunching the CO2 numbers that result from putting 70 people on an airplane for a 13,000-mile round trip. Tata to siesta during Ford’s Fiesta I t appears that Tata’s victory party has been held up by a Fiesta. This week the Indian automaker will announce that it has won the bidding to purchase Jaguar and Land Rover from Ford. But that won’t come until Ford’s redesigned world car, the Fiesta, gets to bask in the spotlight Tuesday at its debut at the Geneva auto show. Roger Maddison, an official at Unite, the largest union in the United Kingdom’s auto industry, told Automotive News Europe that Tata had agreed to guarantees Unions had been seeking assurances that Tata would continue to get engines, stampings and other components from Ford plants in Bridgend in Wales and Dagenham near London. Ford had no official comment, but an insider confirmed that speculation about an announcement Wednesday or Thursday was “not too far off track.” The source said announcement of the sale was being held back to avoid overshadowing the debut of the redesigned Fiesta. The redesigned Ford Fiesta will be unveiled this week in Geneva — and then it’s Tata’s turn in the spotlight. sought by union leaders. Said Maddison: “Everything seems fine as far as we are concerned; it’s just the lawyers working on it now.” http://www.autonews.com/geneva http://autonews.com http://autonews.com/edwardlapham

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

Bob Nardeli's new big-idea guy New Kia boss reaches out to restless dealers Scion hits a wall Lithia losses raise caution flag Detroit 3 shun talk of NAFTA do-over Lincoln names new marketing manager Mercedes to launch hybrid sedan in '09 Mazda has new top marketing exec M-B will hit the road with 50-state diesels Pontiac puts big ad bucks into traditional media for G8 Reynolds, ADP diverge on growth strategies Ford plans to cut fleet sales 10% in 2008 Mazda: New models, styling will boost its loyalty rate Run-up to axle strike adds to supplier woes Webasto's fast heater will debut by 2010 Russian plant wants to be world's biggest A Lancer is hatched Chrysler throws out purchasing rulebook Honda sets lofty hybrid goal, with Civic's help Honda: Use of ethanol limited, must be biomass Honda CEO Fukui: No recession in U.S., despite soft sales in spots 550 hp? 620 hp? Is GM crazy? Doug Fraser was a great leader How ironic: Lyons learns caution Well done, Doug Don't let Calif. impose fuel rules on the nation Blame the dealer, not the brand Cutting weight doesn't cut safety When Lutz dumps on global warming ... JM exec Czubay: A taste for hogs, pierogi Doug Fraser: A good man to have known Fraser led UAW with 'combination of substance, politics and charm' Autonet finds success at NADA with wi-fi for cars GM to sell medium-truck business, keep dealer network Web classified ad firms renew marketing to dealers, buyers Chery designs venture's vehicles China venture eyes 20,000 Fiesta hatchback sales Toyota plans crossovers in China Dongfeng, YuAn plan minicars BMW shakes up global marketing, sales ranks Delphi divestiture boosts forging supplier Is Blackhawk purchase bucking a trend? Repair company grows as Detroit 3 struggle BorgWarner unit expands German automakers seek more parts sourced in North America Hyundai picks ArvinMeritor Japan parts firm to build Miss. plant Nissan to increase spending on IT Purchase keeps Tenn. plant open Automakers hit with apartheid claims Mexico sales flat in January Ford prices '09 Flex atop crossover line Hamp rejoins Visteon board RV deliveries decline 3.4% in December Subaru lowers Forester price Personnel Bright future for LED headlight suppliers? Valeo's Morin to Pardus: Learn before you leap German automakers aren't worried about U.S. recession Porsche's Wiedeking: We must retool VW Europe's loud debate over quieter tires Noise level depends on the tires, the road Auto industry robotics spending jumps 43% in 2007 Electronic brakes struggle to get traction Big Texas dealer returns to some domestic brands AutoNation chief sees tough '08, better '09 In downturn, Sonic looks beyond new cars GM promotes service, parts leads for dealerships 10 cool dealership technologies found at NADA Dealers Kia will build transmissions at Georgia plant Gibson leaves DealerTrack board Akebono closing Kentucky plant Feds issue Ford fire warning Magna net income drops VW to use Siemens' software A tale of 2 exhaust systems EU wants CO2 in ads; battle looms Maize malaise stalls ethanol Tata to siesta during Ford's Fiesta Honda moves its American bike offshore Honda will recycle cycle plant Tom LaSorda's multimillion-dollar smile

Automotive News - March 3, 2008

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