Automotive News - November 17, 2008 - (Page 6) 6 • NOVEMBER 17, 2008 BMW diesels: Priced for profit Diana T. Kurylko dkurylko@crain.com BMW of North America LLC is pricing its new clean diesels for profit, not volume, in the United States, where acceptance is still a big question. With diesel vehicles accounting for 67 percent of its sales in Europe and no experience with diesel here, BMW instead is shooting for higher profits, pricing its diesel vehicles above those of its major rivals. BMW will charge a premium that tops $4,000 for one model. The pricing decision comes on the heels of a 63 percent drop in thirdquarter net earnings, production cuts and a 40,000-unit reduction in U.S. allocation in favor of more prof- BMW’s 335d diesel will cost $44,725 — $3,800 more than the comparable gasoline version. itable markets. The X5 xDrive35d diesel crossover will cost $52,025, compared with $47,925 for the X5 xDrive30i gasoline version. The 335d diesel will cost $44,725, up from $40,925 for the comparable gasoline version. Prices include shipping. By contrast, Mercedes-Benz chose to charge less in an effort to increase demand for its diesels. Mercedes’ ML320 Bluetec crossover costs $49,475, compared with $47,974 for the ML350 gasoline model — a $1,501 premium. The Volkswagen Jetta diesel sedan and wagon have a premium of about $2,000. Audi has not priced its Q7 diesel, which goes on sale in January. Its executives have said they would put a premium of at least $3,000 on the diesel. BMW says both vehicles are eligible for an IRS advanced lean burn technology vehicles tax credit — $900 for the 335d and $1,550 for the diesel crossover. BMW says that although diesel fuel costs more than premium gasoline — which all its vehicles require — the ultraclean diesels are about 30 percent more fuel-efficient. BMW says the 3-series diesel has a range of 560 miles on one tank, and the X5 can go 585 miles before refueling. The X5 xDrive35d and 335d begin arriving at dealerships in late December. c Stewart: Google Browning: MySpace Lazar: GM 3 ad experts will speak at congress Auto advertising directors of Google, MySpace and General Motors will be featured speakers at the Automotive News World Congress in Detroit. Bonita Coleman Stewart, industry director for automotive at Google; Heidi Browning, senior vice president of insight and planning for MySpace; and Betsy Lazar, executive director of advertising and media operations for GM, will speak Tuesday afternoon, Jan. 20, about new media and marketing. Lazar, 51, was named to her post Jan. 1, 2006. She oversees GM’s U.S. media planning and buying operations. Before joining GM in 1989, Lazar was director of media planning on the Volkswagen/Audi account at DDB Needham in suburban Detroit. Browning, 41, oversees client marketing strategy, consumer insights and analytics, marketing communications and trade marketing for MySpace, the online social portal. Before joining MySpace, Browning worked for Fox Interactive Media. Stewart, 51, joined Google in July 2006. She develops and executes marketing plans for automotive clients. Previously, Stewart was director of Chrysler group interactive communications for DaimlerChrysler AG. In 2005, her group was named the Interactive Marketer of the Year by Advertising Age — which, like Automotive News, is published by Crain Communications. c Chery cars for Chrysler? Not for now, maybe never Yang Jian yangjian@autonewschina.com SHANGHAI — Chrysler LLC’s plan to bring Chery Automobile Co.’s cars to North America appears to be dead — or on the back burner. Last year, Tom LaSorda, Chrysler’s CEO at the time, touted a deal in which Chery would supply small cars to Chrysler. The two companies were scheduled to start bringing cars to Mexico this year. But now, neither company is talking about the deal. And a source says the program is on hold. “I wouldn’t place much hope on it,” says a former Chery executive familiar with the Chrysler deal. “Both companies have their own problems to deal with, and both have run out of money.” He says a major obstacle was the substandard quality of Chery’s cars. “Chery knows there is no way for these cars to meet the safety and emission standards of the U.S. market in the near future,” the former executive says. Chrysler and Chery never offered a public timetable for the arrival of Chery-made cars in U.S. showrooms. In a May interview with Automotive News, LaSorda said plans for Chery’s U.S. debut were having difficulties. “We need small cars,” said LaSorda, who now is Chrysler’s co-president. “Chery’s cars are still not ready for that exposure into these markets.” China-built cars probably won’t be ready to meet U.S. safety and emissions standards for “three years or more,” LaSorda added at the time. Plans to bring Chery-made cars to Mexico for Chrysler also are on hold, says the former Chery executive. On Thursday, Nov. 13, Chery spokesman Jin Yibo said, “We have no further information to release at this stage.” Asked to comment on the prospect of Chrysler getting cars from Chery, Chrysler spokesman David Elshoff said: “We’re not aware of any change to the status to our relationship with Chery.”c Namrita Chow in Shanghai and Bradford Wernle in Detroit contributed to this report Honda’s motor-driven devices reduce the burden on assembly workers’ muscles and joints by up to 20 percent. Honda’s robo-legs ease strain, pain Device gets test in Japanese plant Hans Greimel hgreimel@crain.com TOKYO — Imagine a factory of tomorrow where line workers slip on robotic cyber-exoskeletons that imbue them with extra strength and endurance as they pump out cars. Actually, this half-human, half-machine robo-worker is no longer science fiction at Honda Motor Co. This month, Honda starts testing robotic leg gear on workers at an auto assembly plant in Saitama, just north of here. The idea behind the two-legged walking-assist machine is to reduce fatigue from repetitive motions such as crouching, bending and lifting. It also may help improve worker concentration, says its creator at Honda, Jun Ashihara. Simply strap on a pair of shoes, sit on a bicyclelike seat and let a pair of motor-driven legs do the rest. The robotic legs connect the seat to the shoes, lifting weary human legs and easing aching sacroiliacs. When I tested the device at its Nov. 7 debut, it nearly threw me backward when I tried to bend over. But I soon got the hang of it and felt a remarkable spring in my step as I bounded up and down stairs. The machine reduces the burden on muscles and joints by up to 20 percent, Honda says. The automaker hasn’t decided when to start selling the device, let alone make it standard equipment in Honda factories. Initial trials in Saitama will test only a handful of the contraptions. The device runs on lithium ion batteries and operates for two hours on a single charge. It has a motor for each leg and weighs 14 pounds. “Technically, there is no weight limit to who can use it,” Ashihara says. “But a person’s build might restrict their usage, especially if they have a big posterior.” c Key facts When: Jan. 19-22 Where: Detroit Marriott Renaissance Center Cost: $1,495 early registration fee by Dec. 1 (save $200); daily fee $850 Information: 313-446-0485 or autonews.com/worldcongress Exclusive lead sponsors: PricewaterhouseCoopers and IBM Overstocked? Slow sales equal high days supply For the first time, the industrywide stockpile of unsold vehicles has climbed to 100 days. Records only go back to 1992, when light-truck data were added to the mix. But a record is a record. Supplies shot up from an average of 72 days on Oct. 1 to 100 on Nov. 1. Sixty to 65 days is considered optimal. The industry as a whole had a 69-day supply as of Nov. 1, 2007. Given October’s sales disaster — down 31.9 percent from the same month last year — the record high isn’t too surprising. The supply figure is calculated based on the daily selling rate Hard to move In October, the days supply of unsold new vehicles soared, but the number of units in inventory grew by a much smaller percentage. NOV. 1 OCT. 1 % CHANGE Running the numbers of the previous month. The Nov. 1 total is inflated because of October’s superslow sales pace. In fact, the raw number of vehicles in inventory hasn’t gone up so dramatically — a sign that automakers have done a defensible job of controlling production while sales have tanked. Supply Unit inventory 100 days 3,112,000 72 days 2,900,600 38.6% 7.3% Source: Automotive News Data Center The 3,112,000 units in inventory on Nov. 1 is the lowest of any Nov. 1 since 2001 and is fewer unsold vehicles than were on hand earlier this year. The total generally includes vehicles at dealerships, factory lots, ports of entry and in transit. On Nov. 1, the Detroit 3 had an average supply of 115 days. For the Japanese, the total was 87; the Koreans, 107 days; and European carmakers, 76 days. c http://www.autonews.com/worldcongress http://www.autonews.com/worldcongress
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