Automotive News - February 18, 2008 - (Page 3)

FEBRUARY 18, 2008 • 3 82nd year — No. 6295 Chrysler would shut to move Plastech work Robert Sherefkin rsherefkin@crain.com Automakers face more child safety rules WASHINGTON — Automakers face new safety regulations aimed at preventing deaths and injuries of children in vehicle incidents other than traffic crashes. The requirements are part of a bill that Congress sent to President Bush last week. He is expected to sign it. Under the bill, regulators are to write rules requiring that all power windows reverse themselves automatically if they encounter resistance, such as a child’s arm. Another provision requires that driver visibility to the rear of a vehicle meet a minimum standard. The new standard can be met with “additional mirrors, sensors, cameras or other technology,” the legislation says. Its purpose is to prevent a vehicle from backing over a child or a person with a disability. A third provision of the bill aims to prevent accidental shifting of vehicles out of park. — Harry Stoffer DETROIT — Chrysler LLC is prepared to shut down all of its assembly plants for about a week if it wins court approval Tuesday, Feb. 19, to move its tooling and equipment from Plastech Engineered Products Inc. to other suppliers. If Chrysler gets court approval to pull its tooling, it will do so quickly, ordering dozens of trucks and riggers to move the equipment to new suppliers. It then will have to close factories while it brings its new plastic parts suppliers online. Chrysler officials have said they can resume production quickly. But even a seamless tooling transfer will take at least four days, not including weekends, says an engineer at a Plastech rival. Given inventories at Chrysler dealerships, the carmaker can live with a production halt of that duration. Plastech, operating under Chapter 11 protection, contended in court that Chrysler should not be allowed to remove the tooling. If the automaker pulled its business, Plastech said, that would endanger the supplier’s ability to reorganize under Chapter 11. Plastech backups If Chrysler wins court approval to move its tooling and business out of Plastech, here are the suppliers that stand to gain. Confirmed Decoma unit of Magna Continental Plastics Mayco Plastics Possible Plastic Omnium Flex-N-Gate Meridian Automotive tential suppliers are.” Decoma, one of North America’s largest trim suppliers, is slated to get both interior and exterior trim. That includes moldings, front and rear fascias, and front and rear fascia assemblies with and without fog lamps, the sources say. A Magna spokeswoman declined to comment. The challenge Decoma and others face in obtaining the tooling is evident at Plastech’s Frenchtown Town- Magna would win The Decoma unit of Magna International Inc. is expected to be the big winner among more than half a dozen suppliers seeking a piece of the $200 million of Chrysler plastic-trim contracts held by Plastech, say sources familiar with the planned awards. Chrysler already has letters of intent with at least three of those suppliers, those sources say. The automaker would not discuss its new supplier arrangements. Spokesman Mike Palese would say only that he is unaware of any new contracts. But suppliers tapped by Chrysler expect their letters of intent will be followed by contracts if the automaker prevails in U.S. Bankruptcy Court. In an e-mail to Automotive News, Plastech CEO Julie Brown said she has heard rumors about rivals angling for her Chrysler business, “but we don’t know for sure who the po- ship, Mich., plant. The tooling weighs tens of thousands of pounds, says the engineer at the Plastech rival. Decoma, Mayco Plastics Inc. and Continental Plastics Co. are expected to split the work from that plant. The turnaround firm BBK Ltd. is to handle the automakers’ tooling resourcing and other logistics, BBK CEO William Diehl confirmed. No overnight move Plastech’s work for Chrysler involves simple molded parts and complex assemblies such as center consoles and painted bumper fascias. Chrysler would have to close its plants because that work cannot be moved overnight. “Just think of all the logistics,” says Jeff Mengel, a partner with the consulting group Plante & Moran PLLC. “There’s the processing, getting tooling validated, getting presses validated,” he says. “Even moving a tool from one press to another in the same facility requires a lot of work.” c Rhoda Miel contributed to this report Auctions: Repos are rising About 1.6 million vehicles are likely to be repossessed this year — the highest number since 2003, the nation’s largest auto auction company predicts. Last year, about 1.5 million cars and trucks were repossessed, mostly because owners defaulted on loans, said Tom Webb, chief economist at Manheim. The last time the industry approached 1.6 million repossessions was five years ago, Webb said. In addition, Manheim says, 2.7 million vehicles at the end of their leases are expected to return to the market this year, up 8.0 percent from 2007. The repossessed and off-lease vehicles could glut some auction lots. — Arlena Sawyers CORRECTIONS A box on Page 8 of the Feb. 11 issue misstated a sales projection for Mitsubishi. Mitsubishi’s outlook calls for a 17.0 percent sales drop in North America in the first quarter of 2008. Mopar added plenty of accessories to a Jeep Wrangler Unlimited on display at the NADA convention. JOE WILSSENS Jeep accessories: Mo’ for Mopar Performance-parts brand wants to team with dealers to outfit new buyers’ vehicles Bradford Wernle bwernle@crain.com A photo accompanying a story on Page 48A in some editions of the Feb. 11 issue was of the wrong vehicle. A 2009 Lincoln MKS is pictured above. A photo accompanying a story on Page 48A in some editions of the Feb. 11 issue was of the wrong vehicle. It should have been a photo of a 1960s-era Volkswagen Beetle . A story on Page 52 of the Feb. 11 issue gave the wrong time period that J.R. Todd had a Chevrolet Tahoe before he sought to trade it in. He had the SUV for a year and a half. SAN FRANCISCO — Mopar, long associated with Chrysler’s musclecar heritage, is taking to the boulders, sand dunes and the Rubicon Trail. At the National Automobile Dealers Association show here, Jeep showed a glow-in-the-dark yellow Jeep Wrangler Unlimited four-door loaded to the rooftop with Mopar accessories. The yellow Wrangler marks a turning point for Jeep and its dealers. Historically Jeep dealers would sell customers a new Wrangler and watch them drive off to an aftermarket shop, where they spent a bundle outfitting their vehicles for the outback. Now Mopar wants to grab a piece of that action. “It’s a huge opportunity” for Jeep dealers to enhance profits, Stephen Shugg, Chrysler director of service and parts operations, said in an interview here. Among the items on the Wrangler are a special off-road navigation system, chrome grille, heavy-duty bumper with a winch, carbon fiber applique for the dashboard and a 200-watt sound system. The only thing that’s not Mopar is the lift kit, which raises the vehicle high off the ground. But Mopar will bring out one of those soon. Mopar launched a computerized ordering system — EASy, which stands for Electronic Accessory System — late last year to allow dealers to work with customers in customizing vehicles. It can only be used by dealers now, but it goes live online for customers March 31. The computer system was developed for Mopar by Snap-on Business Solutions in Richfield, Ohio. The first dealer to install the EASy system improved accessory sales from $180 to more than $300 per vehicle, said David Foutz, director of global marketing for Snap-on Business Solutions. Dealership service departments will install the gear. Because most customers buy accessories within 90 days of purchasing their vehicles, dealers have a good opportunity to cash in early. Customers will be able to use the new ordering software to soup up any Chrysler vehicle. c

Table of Contents Feed for the Digital Edition of Automotive News - February 18, 2008

Ford cuts equipment combinations on '09s Lenders shun subprime market Toyota dealers test satellite service centers Despite cost, more carmakers use laminated glass Merger produces turnaround firm Chrysler would shut to move Plastech work Jeep accessories: Mo' for Mopar Auctions: Repos are rising Automakers face more child safety rules Supplier Personnel Family-owned stores could be tough sell for consolidation What would lineup be with brands under single roof? Mercedes will pay $9.5 million to settle suit Beru revamps strategy to boost profits, growth Jaguar: Dealers take 10,000 customer deposits for XF sedans Chrysler exec: Performance segment will survive Mahindra to offer hybrids in U.S. Mazda ad agency hires VW and Mini creative whiz Icy weather and perhaps boredom chill roadster sales GM, Saturn: What's after Reynolds? Ford: Mid-sized model year for mid-sized cars Kia's new American boss: Let's boost sales Rolls gets sporty Luxury brands push to meet demand in Russia Dealer is makers' best voice in D.C. Get real, Kia, Hyundai Face it, Detroit: Trimming dealers will be expensive GM has confidence in the Chevy Volt It's no wonder auto sales are declining A workable idea: GM dealer buyouts It's deja vu again with reborn 2CV Nothing beats face to face There's a person behind that e-mail Buying cars online makes perfect sense Bush seeks to save 2008-11 CAFE rules Personnel Lear investor: No regrets about blocking buyout GM CFO is mum on more aid to Delphi Dealers Road to tomorrow is paved with plastics Council aims to keep Ford current on environmental issues VW ponders Phaeton's U.S. flop, may try again McGuffie is Covisint's president In hydrogen race, Mazda seeks quicker route Suit seeks to enforce title-washing remedy Suppliers to the 2008 Buick Enclave Mercedes, Audi warn dealers: No sales for export Sykora wants CAFE flexibility Minority dealers see tough times in 2008 Arlena Sawyers Toyota goal: Create stress-free store NADA's Taylor predicts 15.7 million U.S. sales this year Honda widens support for dealer ad groups Jay's jabs Survival 101: Get lean, work harder Microsoft will test dealership system Farley wants market-by-market sales strategy Entertaining the troops Report: Detroit 3 cutbacks curb rental-fleet sales Dilts: High interest rates hurt industry GM asks for dealer assistance on quality On the Record Fisker: We're close to making plug-in car J.D. Power exec: Internet leads are slipping away Minority auto group nears 2 deals Garmin makes navigation technology deal Tenneco wins Ford work B-P-G focuses on new product push Volvo offers cash to thin the herd Cadillac challenges dealers to boost sales Chevrolet can stay No. 1, if it will fight GM will push a green marketing message Saturn is expected to be GM's growth brand Certified used sales help Honda dealer profits Hummer counts on pickup to perk sales Mazda will boost marketing budget, unveil Mazda6 Saab dealers to get new vehicles Toyota wants even better customer loyalty Infiniti stresses profits and customer satisfaction Mitsubishi CEO sets tough U.S. sales goal Nissan exec: New models will boost per-store sales Suzuki dealers cheer return of incentives Ford to boost dealer margins Jag dealers anxiously await the XF Ford executives vague about Mercury future Subaru dealers want diesels, hybrids Acura upscale shift inspires 'great faith in the future' BMW readies national loaner-car program Land Rover: Future upbeat, unclear VW dealers get vehicles on wish list Chrysler dealers OK with consolidation plan Mercedes pushes dealership standards Porsche shrinks as luxury segment lapses Large Hyundai dealers get more room to roam Execs' exit stuns Kia dealers Ford recalls 180,000 trucks over door part, fuel hose GM posts massive loss; eyes N.A. profits by 2011 Big-truck sales fall 33.5% in Jan. WTO rips China's tariffs on imported auto parts Fiesta will rejoin the party in the U.S. UAW's Valentine to Delphi: Hands off our pensions Rx for dealership flux: NFL draft + Mideast bazaar Toyota gets the boot in Mexico Nissan triples female managers Silverado hits a million, rolls on

Automotive News - February 18, 2008

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