Auto Industry News

Auto Industry and Tire Industry News From Around The Globe

Auto sales increase, manufacturers remain cautious

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May was a good month for major automakers, as sales in the U.S.  posted double digit gains from depressed levels earlier this year. The gains marked the seventh consecutive month of increasing sales across the industry. May’s numbers were boosted by strong orders from rental agencies.  Not only is this a nice sign for the auto industry, but it also suggests that consumer demand and the strength of U.S. economic recovery is still on track in the 2nd half of the year.

Among the largest domestic automakers, Ford Motor Co posted a 22 percent sales gain, GM’s overall sales were up 17 percent from sales a year earlier, and Chrysler reported a monthly sales gain of 33 percent. Chrysler had already been operating in bankruptcy last May, and GM filed for Chapter11 bankruptcy protection in June 2009. The government still holds a nearly 61% stake in GM, thought the company has said it is aiming for an initial public offering as soon as this year to reduce this percentage.

Fleet sales to companies like rental agencies, considered less profitable than retail sales, still represented about 38 percent of GM’s total sales in May. Other improvements were attributed to strong sales of newer cars like the Chevy Equinox and the Camaro.

Although world financial markets were jittery throughout the month, most experts aren’t forecasting any major downturns or setbacks for the economic recovery.

“Recently we’ve all witnessed significant volatility in the financial markets,” one GM official cautioned. “While that volatility’s been significant, we don’t think it signals another collapse of the global economy or the vehicle industry.”

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Written by wholesaletireblog

June 2, 2010 at 8:17 pm

Memo suggests Toyota cut corners to save money

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Toyota is in the midst of one of the biggest safety crises in the history of the company. Now, a memo has come to light that claims the corporation was able to save $100 million by getting U.S. regulators to agree to a cheap fix for accelerator problems that have been causing fatal crashes. The auto manufacturer’s reputation has taken a hit as they initiate a global recall of over 8.5 million vehicles plagued by problems such as sticking accelerators, loose floormats, and braking glitches. The company’s president, Akio Toyoda, arrived in Washington to testify before congress.

A new internal memo suggests that some crashes were falsely attributed to nothing more than loose floormats in an attempt to avoid a costlier recall. This 2009 document shows Toyota’s Washington D.C. staff hailing $100 million saved by convincing regulators to end a 2007 investigation of sudden acceleration complaints with a less expensive  floormat recall. If U.S. lawmakers reach the conclusion that Toyota ignored, covered up, or otherwise mishandled these serious safety allegations, it will not bode well for the company’s reputation and sales numbers. U.S. regulators are under fire as well.

Toyoda’s testimony will be a key point in the automaker’s history.

“Congress is doing him a favor. He can be apologetic and be contrite and take responsibility and acknowledge that there have been some stress points in growth of the company,” said one analyst.

Toyoda has suggested that safety standards may have slipped as the company dealt with rapid growth during the last decade.

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February 22, 2010 at 2:23 pm

Chrysler recalls 24,000+ vehicles

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Chrysler Group LLC announced that they will initiate a recall of 24,177 vehicles due to a potential problem with the brake system which may cause sudden brake failure. The Chrysler recall applies to 2010 model-year Chrysler Sebring, Dodge Avenger and Nitro, and Jeep Liberty, Commander and Grand Cherokee SUVs, as well as 2009-2010 model year Dodge Ram trucks.  The specific issue involves the clip retention tab on the brake pedal pin. In some systems, this pin was improperly formed or not installed during the manufacturing process, according to papers filed with National Highway Traffic Safety Administration. The malfunction or absence of this safety pin could result in brake failure without warning, though Chrysler made it clear that it was unaware of any accidents related to the issue. The recall is schedule to take place before the end of January.

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January 21, 2010 at 2:52 pm

Toyota aims to double hybrid production in 2011

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Toyota aims to double its global production of hybrid cars in 2011.

Toyota, the world’s largest automaker, has said in a report that it aims to double production of hybrid vehicles in 2011 to 1 million units. Toyota Motor Corp currently leads worldwide manufacturers in the production of low-emissions vehicles, which have seen strong sales numbers as of late thanks to tax breaks and government subsidies. The Toyota Prius was the best-selling car in Japan last year.

Hybrid cars seem to be the main focus of manufacturers experimenting with low-emissions and green technology. Kazaka Securities chief analyst Yoshihiko Tabei remarked that, “For the foreseeable future, the focus of Toyota’s (low-emission car) strategy will be on hybrids, not electric or fuel-cell cars.” He added that Toyota is facing weak competition in the hybrid market and is poised to put significant distance between itself and competitors like Honda if it can achieve its production goals.

Global production of hybrid vehicles accounted for an estimated 8% of overall production in 2009 – about 500,000 units. Hybrid production has already expanded beyond Japanese borders to China, USA, Thailand, and Australia where it as received the support of state-backed incentives to even the playing field.

Written by wholesaletireblog

January 18, 2010 at 1:42 pm

Posted in Hybrid Cars, Toytota

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Volvo chairmain resigns unexpectedly

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Volvo chairmain Finn Johnsson has resigned.

Volvo chairmain Finn Johnsson has resigned.

In a move that industry analysts are calling “unexpected and surprising,” Volvo chairman Finn Johnsson has resigned just three month’s away from the company’s annual general meeting. Finn claimed that “increasingly comprehensive assignments” were his primary reason for leaving the firm. A Volvo spokesperson confirmed this and added, “He has a wide range of missions and they have become more and more demanding.” Johnnson himself was unavailable for immediate comment as he was undergoing scheduled surgery.

Some analysts speculate that Johnnson was pressured to resign after receiving critical feedback for the way he has managed Volvo during the recent market recession. The market downturn has affected many businesses, but as conditions begin to improve Volvo has lagged behind competitors like Daimler.Volvo truck shipments fell 37% year-over-year in November.

“He [Johnsson] has been highly criticized by some of the main shareholders on the back of both paying out dividends, given the cost of capital this year, and also (not) taking blame for poor performance,” one analyst said.

Louis Schweitzer, chairman of AstraZeneca, will fill Johnnson’s shoes until the general meeting. Schweitzer has been a Volvo board member for 9 years and was previously chief executive and chairman of Renault, a company which owns 20 percent stake in Volvo.

Volvo shares, which had declined earlier this week on speculation of a share issue, fell to 65.05 Swedish crowns ($9.24)  on Friday.

Written by wholesaletireblog

January 15, 2010 at 2:29 pm