Automotive News - May 26, 2008 - (Page 22)

22 • MAY 26, 2008 Nissan wants suppliers to reduce utility bills Lindsay Chappell lchappell@crain.com Energy awareness Some ways Nissan aims to cut utility bills in its factories and in suppliers’ plants Eliminate unnecessary lights Shift weekend work to normal workweek Delay start of paint ovens Use methane gas from landfills SMYRNA, Tenn. — Nissan Motor Co. wants its U.S. suppliers to cut costs by doing something as simple as turning off the lights. Nissan has been slashing its own utility bills. Now it is asking about 350 North American suppliers to join the effort. The campaign is an “invitation,” rather than a mandate, says Larry Burks, one of the leaders of the effort. And Nissan is not asking the suppliers to direct savings back to Nissan. “We want them to be healthy suppliers,” says Burks, whose main job is paint plant director at Nissan’s car and truck plant here. Nissan estimates the program will cut its utility bills by about $5 million a year. The company has set a goal of reducing utility consumption 30 percent by 2010, and has tied managers’ salary packages to how well they hit their energy targets. It recently invited about 30 suppliers to the Smyrna plant to swap utility-savings ideas, and now plans a second meeting. “We’re rethinking a lot of our assumptions about how you do things at an auto plant,” Burks says. “Normally, you turn on your paint ovens Need Salespeople, Tech’s, Managers & Other Employees? The Auto Industry’s #1 Recruiting, Training & Marketing Company Salespeople~BDC~Detailer~Porter~Technician Body Tech~Service Advisor~Service Manager Parts Counter~Parts Manager~Sales Manager Finance Manager~Office Staff~GSM~GM 800-421-4550 www.clickhereforadvice.com Brian C. Hall, President & CEO hours in advance of using them to make sure you get them at exactly the right temperature. We’ve discovered that that really isn’t necessary. We can turn them on right before the cars arrive and it works just fine. That will save a lot of energy.” Plant engineers also discovered that it wasn’t necessary to have lights over welding robots. When a technician moves in for maintenance, lighting automatically turns on for the human. It turns off when the human leaves. Nissan also has removed lighting from vending machines in Smyrna, at a savings of $50 a year per machine. The company realized it was wasting energy in the summer by blowing clean air-conditioned air out of the factory, and will now redirect it into work areas. It also is studying the idea of pumping naturally occurring methane gas into the plant from a landfill to replace its reliance on expensive natural gas. BMW has been saving about $1 million a year using landfill gas to heat its paint ovens and factory in Spartanburg, S.C. “A lot of our suppliers have been wondering about this,” says Burks. “They wonder, ‘Is this going to be a take-away program where we expect lower prices in return?’ And the answer to that is no.” c RAVEENDRAN/AFP/GETTY IMAGES/NEWSCOM Bajaj Auto is known for scooters, motorcycles and three-wheel auto rickshaws. The company now has joined with Nissan and Renault to develop a basic auto for India and other emerging economies. Above, a Bajaj three-wheel auto rickshaw, at left behind the two-wheeler, makes its way through heavy traffic in New Delhi. The next $2,500 car? Nissan, Renault, Indian company eye a rival to Tata Nano Mehul Srivastava autonews@crain.com Bajaj: From scooters to autos NEW DELHI — Bajaj Auto Ltd., little known outside India, is a 63year-old company whose name is synonymous with scooters here. In 1945, Bajaj started importing motorcycles into India. The company is based in Pune, on the west coast of India, and recorded revenues in the 2008 fiscal year of $2.4 billion. Bajaj has long been protected from imports by India’s restrictive trade policies. It once had a 10-year waiting list for its scooters. But Bajaj lost market share and dominance to the Hero Group, which had partnered with Japan’s Honda to specialize in motorcycles. In 2000 Hero surpassed Bajaj as India’s manufacturer of two-wheelers. Bajaj’s signature product until 2000 was scooters. Bajaj’s Vespalike scooters, with step-through frames, proved unpopular with young consumers, who preferred the sleek, racing-bike look of Honda motorcycles. Bajaj responded by entering the motorcycle segment in 2001 and is slowly regaining market share. The company pioneered the three-wheeled cargo vehicle, and almost all of India’s auto rickshaws are Bajajs. The company was run for many years by Rahul Bajaj, 69, whose net worth is estimated in excess of $1.1 billion. In 2005, the company was divided among family members. — Mehul Srivastava NEW DELHI — Three more automakers have plunged into what may become a hot segment: the $2,500 car. Although suppliers see opportunity, U.S. parts makers could have trouble getting a piece of the action. Bajaj Auto Ltd., the Indian maker of the country’s ubiquitous three-wheel auto rickshaw, is leading the design and manufacture of a $2,500 car to rival Tata Motors Ltd.’s Nano. Bajaj is working with Nissan and Renault to develop the basic auto for India and other emerging economies. Suppliers around the world helped Tata engineer the Nano and have been enthusiastic about low-cost cars. But Bajaj likely will source almost all of its components from suppliers in India, say company executives and major suppliers. Made in India “When you talk about a $2,500 car, you are talking components so cheap that it’s doubtful that European or American manufacturers can even compete,” says Sanjay Labroo, president of India’s Automotive and Component Manufacturers Association. That largely narrows the field to companies — both Indian-owned and subsidiaries of foreign suppliers — that manufacture components inside the country, says Labroo. He is also the managing director of Asahi India Glass Ltd., the country’s biggest automotive glass manufacturer. In the past, Bajaj has preferred suppliers within four hours of its plant in Chakan, in western India. East Asian suppliers, especially those associated with Maruti Suzuki Corp. and Hyundai Motor India Ltd., could be competitive, but taxes and customs surcharges might rule them out, says Labroo. Maruti Suzuki and Hyundai manufacture small cars in India. Bajaj is India’s second-biggest motorcycle manufacturer and has no experience building four-wheeled cars. It will assemble the vehicle with two partners, Renault SA and affiliate Nissan Motor Co. Bajaj will own 50 percent of the venture, and Renault and Nissan will own 25 percent each. Bajaj does assemble a three-wheeler, commonly used either as auto rickshaws for urban commuters or as small cargo carriers. It holds almost 80 percent of the three-wheel market in India. Tata wants to sell the Nano to dealers for a wholesale price of $2,500. The Nano, which is scheduled to arrive in showrooms in October, has a two-cylinder engine that produces 33 hp. Emerging markets Like Tata, Bajaj intends initially to focus on India but has said it intends to export to Africa, Asia and Latin America within two to three years of launch. The Bajaj car, code-named the ULC, already is past the concept stage. A 60-person team, mostly from Nissan and Renault, is working on design issues, says Ravi Kumar, vice president for development at Bajaj. “We are not at the prototype stage yet,” he says. “Sourcing issues are a little far away.”c ® SM ACTION INTEGRATED MARKETING PROVIDES FULL-SERVICE & EVENT MARKETING SOLUTIONS FOR DEALERSHIPS NATIONWIDE Tata Motors wants to sell the Nano to dealers for a wholesale price of $2,500. The Nano is scheduled to arrive in showrooms in October. http://www.clickhereforadvice.com http://www.clickhereforadvice.com http://www.actionIM.com

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Automotive News - May 26, 2008 Bad times? Not for CEO paychecks GM seeks Volt tax break to avoid $40k sticker Ford's big cuts aim for a Honda-sized lineup Automotive News gets new marketing communications director Toyota pushes N.A. suppliers to match offshore prices VW predicts 5% U.S. sales gain Toyota plans 3 plants for hybrid batteries GM's American Axle strike tab: $2.82 billion Lawsuit in Florida targets congressman's dealership Orbiting the blogosphere Kia to build small cars in U.S. plant VW Mexico exec will run North American purchasing Fiat mulls 500 minicar for U.S. GM scraps big rwd sedans for Chevrolet and Buick Hyundai spends like never before to launch Genesis luxury sedan Surprise: Suzuki slides as fuel prices rise GM paid Walter Chrysler a whopping $600,000 a year Chrysler sends mystery shoppers to dealerships Toyota owes royalties on some hybrids GM, American Axle to resume output Ford predicts bigger demand for smaller engines in Escape This is Volvo? Ads sell chic, not just safety An overnight success in 50 years Obama's comments were out of line Japan does it; why shouldn't we? 25% is high, but Chrysler is wise to revisit SCORE Safety efforts must focus on the driver Blame the dealer for poor service Don't judge Ford quality by just one car Ford quality is best in many years Mitsubishi considers piggybacking with Caterpillar suppliers to cut costs Nissan to make lithium ion batteries 'Boss Ket,' Connery inspire Tim Jackson Germany leads rise in Europe sales Court: Buyers must act in good faith to win lemon law damages Nissan wants suppliers to reduce utility bills Bajaj: From scooters to autos The next $2,500 car? Infiniti will look different, add engine power in Europe Lamborghini boss wants to keep the big engines Lamborghini ups ante in 'entry' supercars Continental exec: We're done selling VDO assets Honda plans Fit hybrid Outgoing Visteon CEO to receive $2.5 million Audi production chief: Cooperation with Porsche will grow Picture this RV shipments fall in March M-B will buy Chrysler studio Supplier personnel VW expects to reap big share of U.S. diesel market Valeo CEO Morin: Pass rising costs to consumers Suppliers to the 2008 Nissan Altima Dealers Auction workshops demystify Web buying April used-vehicle prices: Light trucks fall and cars rise Volvo certified plan offers free satellite radio Mulally: Full speed toward smaller Toyota plans credit card Sanfilippo switches agencies International idles plant Honda Pilot starts at $28,230 Plastech plans assets auction What counts GM's 2-pronged strategy for Calif. rules: If you can't beat 'em . . . meet 'em New wheels for the cop shop The cost of luxury? For Hyundai, it would have been $2.5 billion New tools allow early design input from consumers Lexus in the sky with carbon: How ex-Beatle's PR effort tanked Buy an '08 . . . get a .44 $4 gasoline gives new cachet to aging econo-beaters Time tips its hat to Tata Car marketers: Magazines must widen ad reach Automakers seek 'one-to-one' approach to magazine ads Auto ads go to the movies Here's the next big thing: Ads tailored to you GMC courts women with Acadia

Automotive News - May 26, 2008

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