Welcome to CAR’s news aggregator as we round up the seismic change in the auto industry. Top tip: news summaries are added from the top hour-by-hour
Thursday 30 April 2009
• It’s official: president Barack Obama confirms this afternoon Chrysler will file for Chapter 11 bankruptcy protection as it strikes a patnership with Fiat (Automotive News, subscription required)
• ‘Over the past month, seemingly insurmountable obstacles have been overcome,’ says Obama. ‘Chrysler and Fiat have formed a partnership that has a strong chance of success’
• Chrysler is filing for bankruptcy protection under Section 363(b) of Chapter 11 bankruptcy code – expected to last for 30-60 days (Detroit News)
• Treasury to pay Chrysler $4.5 billion ‘in exit financing’
• Chrysler tipped to get new board of directors. Chairman and CEO Bob Nardelli likely to be replaced
• Fiat to start with 20% stake in Chrysler – rising to 35% when it passes key milestones, including building a 40mpg vehicle
The following was written before Obama’s announcement at 5.19pm Thursday afternoon
• The White House plans to force Chrysler into Chapter 11 bankruptcy after talks between Treasury officials and Chrysler’s creditors collapsed last night, reports the Detroit News (Detroit News)
• President Obama is likely to announce a signed deal between Fiat and Chrysler in the next few hours – as well as a short stay in bankruptcy court to wipe away some debts and liabilities (Detroit News)
• At least three of Chrysler’s 46 lenders refused to accept the Treasury deal to swap $6.9bn of debt for $2bn of cash. Four major lenders holding 70% of the debt had agreed to the deal on Tuesday (Detroit News)
• We’ll hear Chrysler’s fate at 05.00am on Friday BST. It still seems most likely that it will file for Chapter 11 bankruptcy (BBC News)
• President Obama said last night: ‘It would be a very quick type of bankruptcy and they could continue operating and emerge on the other side in a much stronger position. I am actually very hopeful, more hopeful than I was 30 days ago, that we can see a resolution that maintains a viable Chrysler auto company’ (BBC News)
• People close to Chrysler’s turnaround plan claimed there remains a chance Chrysler can avoid bankruptcy. Managers and politicians spent Wednesday trying to persuade the last few debtholders to accept concessions. The Treasury sweetened its offers on the $6.9 billion of debt by $250m – taking it to $2.25bn in cash to win over undecided debtholders (Financial Times)
• President Obama has prepared two versions of his speech: one for if Chrysler does file for bankruptcy protection, one for if it doesn’t (Wall Street Journal)
• Chrysler CEO Bob Nardelli is set to be replaced by Fiat management under a bankruptcy plan being prepared in Auburn Hills, Chrylser’s HQ outside Detroit (Washington Post)
• We’ll hear later today whether Chrysler will file for Chapter 11 bankruptcy protection. Trade title Automotive News claims that bankruptcy is part of the expected deal with Fiat (Automotive News, subscription required)
Wednesday 29 April 2009
• The Volkswagen brand today posted an operating loss of €279 million in the first quarter (compared with a profit of €461m last year). Spanish outpost Seat lost €145m in the first three months (versus a €12m profit in 2008), while Bentley lost €52m (last year it posted a €39m in the same period) (Automotive News Europe, subscription required)
• Meanwhile, Audi announced a €363m operating profit (down from €514m in the first quarter 2008) and Skoda’s profits slipped from €182m to €28m in the same period. Lamborghini’s performance was ‘satisfactory’, according to the results (Automotive News Europe, subscription required)
• British van maker LDV will collapse into administration on 6 May – a move likely to result in thousands of job losses. Russian owner GAZ had hoped to strike a £4-6 million bridging loan from the UK Government but failed (Financial Times)
• When GM closes its Saturn brand later this year, a quarter of its hybrid models will go too (Automotive News Europe, subscription required)
• Fiat and Magna are emerging as rival bidders for a slice of GM’s Opel/Vauxhall subsidiary. German politicians say Fiat wants a controlling stake in Opel (Automotive News, subscription required)
• Daimler, parent company of Mercedes and Smart, posted a loss in the first quarter of 2009. The firm’s net loss of €1.29 billion compares with a profit of €1.33bn a year earlier – after Merc car sales fell by 27% to 231,200 vehicles (BBC News)
Tuesday 28 April 2009
• Daimler has struck a deal to relinquish its 19.9% stake in stricken Chrysler, the company said today. It sold most of its loss-making unit to Cerberus Capital Management in 2007 (BBC News)
• Under the deal, Daimler has agreed to pay three annual instalments of $200 million into Chrysler’s pension pots. In return, Chrysler will waive any claims against Daimler – including the accusation that it was economical with the truth over Chrysler’s acquisition and sale (BBC News)
• As part of its separation, Daimler agrees to forgo repayment of $1.9 billion in loans (Financial Times, subscription required)
• UAW union leaders last night approved labour concessions that will cut Chrysler’s cash payments to retiree health funds in return for a 55% equity stake in the new company (Automotive News, subscription required)
• There’s a scramble at Chrysler to finalise all the multifaceted deals ahead of Friday’s government deadline to qualify for a further $6bn in state aid. It must agree terms for an alliance with Fiat – without it, Chrysler is likely to file for bankruptcy protection (Automotive News, subscription required)
• Further details on GM’s re-restructuring plan: it plans to cut 21,000 further US jobs this year as part of its race to convince politicians it has a viable future (BBC News)
• Honda reported a smaller-than-expected loss in earnings for the last financial year – down 70% on the previous year to 137 billion yen. Although it lost 186bn yen in the first quarter of 2009, it said it expected to remain profitable this year (Financial Times)
Monday 27 April 2009
• General Motors confirmed today it would axe the Pontiac brand by the end of 2010 – leaving just four key badges: Chevrolet, Cadillac, Buick and GMC in the US. Model proliferation will drop from 48 models sold in 2008, to 34, as further cost savings kick in (Justauto.com, subscription required)
• GM also uncovered plans to shut half of its 6200 US dealers by 2014. New GM chief exec Fritz Henderson has beefed up Rick Wagoner’s survival plan and admitted the business will file for bankruptcy unless a sufficient number of debt holders agree to take stock before the 1 June deadline (Automotive News, subscription required)
• ‘We only want to do th is once,’ says GM boss Henderson. ‘Our objective is to make this a defining moment for the corporation.’ Should GM file for court protection, it may sell most of its healthy assets to New GM, under section 363 of the US Bankruptcy Code – leaving all the rotten bits of the business to be liquidated
• Ferrari was the most profitable part of the Fiat Group in the first quarter of 2009, new company results show. Maranello posted a trading profit of €54 million (Ferrari)
• Chrysler could collapse on Friday, as the 1 May 2009 deadline to qualify for further US government aid looms. President Barack Obama set the deadline for Chrysler to complete a debt-restructuring deal, further union concessions and a ‘truly viable’ alliance with Fiat (Financial Times, subscription required)
• Chrysler LLC struck a deal with the United Auto Workers late on Sunday night to rejig the costly 2007 healthcare deal. The UAW said it had also reached agreement with Fiat and the US government ‘after marathon talks’ (Detroit News)
• The Canadian Auto Workers Union has ratified a new contract with Chrysler – bringing new concessions to working practices ahead of the looming deadline for Chrysler to convince US government that it has a viable future (Chrysler)
• CAR Online will be covering Chrysler’s countdown throughout the week. Stay tuned for more analysis and news as it happens
• Audi today posted a €363 million operating profit in the first quarter of 2009 (down from €514m in 2008). Its western Europe market share grew half a percentage point to 4.6% (Audi)
• Mitsubishi Motors also reported an operating profit – of 3.9 billion yen ($40.6 million) for the last business year ending 31 March. The previous year it made 108.6bn yen (Financial Times, subscription required)
Friday 24 April 2009
• The Society of Motor Manufacturers and Traders (SMMT) has reported vehicle production figures for the year-to-date in the UK are down 57.4% (SMMT)
• Managing director of Peugeot UK, Pierre Louis Colin, is moving to Paris as the French company’s director of strategy and programmes for electric and diesel hybrid vehicles. Jonathan Goodman will replace him from June 1 2008 (Peugeot)
• Honda has reconfirmed its commitment to the development and production of cleaner diesel engines for Europe, and opened a new plant in Ogawa, Japan, that will supply cylinder blocks and casting parts for its 2.2-litre oil burner (Honda)
• Ford has reported a loss of $1.4bn (£.095bn) for the first three months of 2009. In the first quarter of 2008 Ford made $70m, but in the last quarter of last year in lost £4bn (Autocar)
• Ford has produced 250,000 Fiestas in the nine months since the new car went on sale, making it the fastest-selling Fiesta ever (Ford)
Thursday 23 April 2009
• Fiat has made a secret offer to purchase a majority stake in Opel that could destroy the Italian’s company’s proposed tie-up with Chrysler. Fiat’s bid was revealed today by Klaus Franz, chairman of Opel’s works council, who has vowed to block the bid as it would lead to redundancies and factory closures. Opel officials are thought to favour a union with parts supplier Magna, especially as a previous deal with GM ended in failure and saw the American automaker pay Fiat £1.4bn (Autocar)
• VW is said to be considering an ‘audacious’ bid for Porsche’s automotive arm, a move that would bring relief to parent company Porsche SE, which is heavily indebted (to the tune of €9bn) after its purchase of VW shares. A Porsche spokesperson, unaware of the bid, said that Porsche’s operating profit and dividends from its VW shares would allow it to meet its interest payments this year. Volskwagen’s annual meeting is today (Financial Times)
• GM is expected to announce on Friday that it will close some of its factories for up to nine weeks during the summer in order to cut 170,000 vehicles from its planned 2009 production (Detroit News)
• Wheatcroft & Son Ltd, the owners of Donington Park, have issued legal proceedings against Donington Ventures Leisure Ltd, the operators of the circuit. The owners are seeking £2.47m in rent arrears and forfeiture of the circuit lease, and the proceedings were issued today at Derby County Court by lawyers at Browne Jacobson LLP (Wheatcroft & Son Ltd)
Wednesday 22 April 2009
• Audi has confirmed it will put the Q3 SUV into production in 2011. The new car will be built at a Seat site in Martorell, Spain, and Audi expects to invest €300m in the car and produce 80,000 units annually (Audi – see related story)
• VW, Seat and Skoda confirm that the Up concepts will be put into production in three- and five-door forms at the Volkswagen Group’s Bratislava plant in Slovakia from 2011 (VW – see related story)
• Chancellor Alistair Darling has announced a £2000 scrappage scheme and a 2p per litre fuel duty increase in his 2009 Budget speech (see related story)
• Citroen has announced its own scrappage scheme. Under the company’s Trade-In Incentive Scheme, customers who order any new Citroën by the end of April 2009 will receive £2000 for their vehicle which must be registered before 2000 (Citroen)
• VW has a reported a 74% slide in its first quarter profits, and PSA Peugeot Citroen was down 25%. VW made €243m in the first three months of 2009, helped by the €600m sales of its Brazilian truck business (Financial Times)
• Glass’s, the publisher of Glass’s Guide, is predicting that the vehicle scrappage scheme is ‘unlikely to have a significant impact on the residual value of used cars – of any age’ (Glass’s)
Tuesday 21 April 2009
• Going-Electric, the European association for battery electric vehicles, has written an open letter to Transport Secretary Geoff Hoon. They claim the proposed £5000 subsidies, not due until 2011, will distort competition and will delay the introduction of battery electric vehicles (Going-Electric)
• Bright Automotive will unveil its IDEA on Capitol Hill today, a 100mpg plug-in hybrid electric van that the company plans to launch in 2013 (Detroit Free Press)
• Bankruptcy for GM won’t be a quick or easy solution. John Wolkonowicz, a senior automotive analyst at IHS Global Insight says: ‘Neither the government nor GM has any control over the outcome if this goes to bankruptcy court.’ He calls the prospect ‘truly scary (Detroit Free Press)
Monday 20 April 2009
• As the world’s automotive press decends on the Shanghai auto show, reports emerge that a number of Chinese car companies are interested in buying Opel/Vauxhall (Automotive News, subscription required)
• GM is reportedly prepared to sell its stake in Opel/Vauxhall for nothing but a guarantee that any new owner will invest in the company formed from the sale (Financial Times)
• Fiat CEO Sergio Marchionne has returned to the USA to seal a partnership with Chrysler ahead of the Obama administration’s 30-day deadline (Automotive News, subscription required)
Friday 17 April 2009
• The Volkswagen Group has increased its global market share in the first quarter of 2009, rising from 9.7% in January to 11% in March (Volkswagen)
• Vauxhall has announced that it will withdrawl from the British Touring Car Championship at the end of the 2009 season. The company claims its decision was ‘influenced by the absence of other manufacturer-backed teams and financial prudence in the current global economic downturn (Vauxhall)
• GM is preparing to ask for special treatment for a limited number of suppliers so that it can continue to pay their bills, should the American car giant go into bankruptcy. General Motors will argue that not paying its suppliers could cause further turmoil for the auto industry (Financial Times)
• Saab has started to show around ten potential investor groups around its operations as its hopes to secure a buyer by the middle of 2009 (Financial Times)
Thursday 16 April 2009
• Lamborghini has announced record profits for 2008, despite the global downturn, and delivered 2430 cars in 2008, a new record and up from 2406 in . The company made pre-tax profits of €60m, up 27.4%, while turnover was up 2.5% to €478.8m and profit margins rose from 10.1% to 12.5%. Lamborghini claims the current economic climate means it cannot make a full-year forecast for 2009, but its overall aim is still to make a profit (Lamborghini)
• The 2009 Race of Champions will take place at Beijing’s ‘Bird’s Nest’ stadium on 3-4 November, just two days after the climax of the F1 season with the Abu Dhabi GP. The RoC will now takes place over two days, offering spectators more events than ever before (RoC)
• UK buyers will get subsidies up to as much as £5000 under new government plans designed to boost low-carbon transport (FT.com)
• Fiat CEO Sergio Marchionne had admitted his company has admitted his company may buy parts of Chrysler if the American automakers filed for bankruptcy (Detroit Free Press)
Wednesday 15 April 2009
• GM might have until 1 June to finalise its rescue plan for US politicians – but it has until this Friday to fix its bondholder issues. A report in the Wall Street Journal claims the deadline for its debt-for-equity transaction is 17 April 2009 (Autoblog)
• GM’s interim chairman, Kent Kresa, said: ‘We have some deadlines rapidly approaching and the probabilities are decreasing we can do outside of bankruptcy (Autoblog)
• Savings from Fiat’s transplanted small-car know-how could be worth as much as $10 billion to Chrysler – but members of the White House auto task force question whether the benefits will arrive in time (Detroit News)
• The Government inquiry into the collapse of MG Rover has now cost £14.8 million, and there’s still no end in sight. Politicians are said to be embarrassed by the mounting cost of the probe at a time when today’s industry is in a perilous state (Financial Times)
Tuesday 14 April 2009
• Renault has poached former Mazda style boss Laurens van den Acker to replace Patrick le Quément as vice president of design. Le Quément leaves after 22 years with the French company and his successor begins in September (Renault)
• The US Treasury is planning to force GM into bankruptcy by 1 June 2009 – unless it can structure a viable turnaround plan or win new external investment. President Obama’s automotive task force favours a ‘fast, surgical bankruptcy’ (New York Times)
• Fiat CEO Sergio Marchionne is tipped to take the top job at Chrysler should the two companies strike a formal alliance (Autoblog)
• Europe’s biggest suppliers are slashing the number of components providers they use. Continental and Schaeffler have set a sourcing cooperation that will cut their 5600 suppliers in half, while Siemens will stop ordering from as many 74,000 suppliers – a fifth of its network (Financial Times)
• Birmingham, the heartland of the UK’s motor industry, suffered the biggest rise in unemployment in the 12 months to February, according to a new survey by the Work Foundation (BBC News)
• Britain’s classic car trade reports booming trade – components suppliers for used classics say there’s growing demand. The sector generates £3.2 billion in revenues a year, according to the British Historic Vehicle Clubs (FInancial Times)
Friday 10 and Monday 13 April 2009
• CAR Online is shutting up shop for Easter. Back on Tuesday!
Thursday 9 April 2009
• Chrysler president Jim Press arrives at the New York auto show in a Fiat 500 – symbolising the US company’s hopes for an alliance with Italy (Automotive News, subscription required)
• New car prices in the UK can – on occasion – be be as much as £1000 cheaper than a secondhand version of the same car, says our sister website Parker’s. It’s caused by a shortage of good quality used models (pushing prices up) and the savage discounting of new cars (slashing thousands off RRPs) (Financial Times)
• Convertible car specialist Karmann Ghia, which currently builds the CLK rag-top for Mercedes, has filed for bankruptcy, becoming one of the highest profile German casualties of the recession. It employs 8000 people worldwide and blamed a sharp drop in revenues (believed to have fallen from €1.2 billion in 2008 to a predicted €450m in 2009) which had ‘blown up all plans’ (Financial Times)
• Karmann Ghia’s collapse reflects how tough contract car makers are finding it, as manufacturers take the build of niche cars back inhouse. Magna Steyr, Pininfarina, Heuliez and Valmet Automotive are struggling to cope with falling orders
Wednesday 8 April 2009
• Germany’s scrappage bonus scheme to swap old cars for new with a €2500 (£2300) government incentive is proving far more popular than expected with 1.2 million motorists already signed up. Berlin had expected the incentives to cost around €1.5 billion, but it’s already running at double that with some analysts predicting a threefold increase by the time the scheme ends on 30 May. No wonder sales in February soared by 12% (Financial Times)
• Prime minister Gordon Brown reveals that the 22 April Budget will include measures backing green car trials, incentives for car makers to build eco cars and a network of recharging points (BBC News)
• Toyota is planning a shake-up of its US sales and manufacturing operations to bring them under one executive. America used to be Toyota’s biggest source of profit, but it’s now making a loss (Detroit News)
Tuesday 7 April 2009
• The European Investment Bank has approved funding for two UK car makers, Jaguar Land Rover and Nissan. It will stump up £710 million for the two to develop low-emissions vehicles (BBC News)
• Jaguar Land Rover will be given £340m, Nissan £370m. These are not bail-outs, but loans – to be repaid to the banks when the economic situation improves. As such, they will need to be guaranteed by the Government
• As many as seven investors – including one Asian private equity firm – have expressed an interest in GM’s European car making business (Financial Times)
• VW is likely to leapfrog GM as the world’s second biggest car maker, German research firm RL Polk said today. Toyota overtook GM to claim the top spot last year (Automotive News, subscription required)
• Ford has cut its long-term debt by $9.9 billion by restructuring its stock and cash allocations (Automotive News, subscription required)
• The shake-up will save Ford $500 million a year in interest charges (Detroit News)
Monday 6 April 2009
• Figures just in from the Society of Motor Manufacturers and Traders confirm the continuing slump in the UK’s new-car market. Both March 2009 and the first quarter were down 30% on the same periods in 2008 – meaning 200,000 fewer new cars sold in the past three months (SMMT)
• The weak sales performance in March – usually one of the busiest months of the year – suggests the UK market is far from rock bottom (Financial Times)
• Saab has been granted an extension to its bankruptcy protection by a Swedish court. It now has until 20 May to reorder its business with impunity from creditors – as it seeks around $600 million from the European Investment Bank and around $400m from GM (Autocar)
• GM has around 20 suitors for Saab, according to court-appointed administrator Guy Lofalk (Automotive News, subscription required)
Friday 3 April 2009
• Private investors are interested in acquiring a stake in General Motors’ European arm. Opel and Vauxhall have warned they could run out of cash next month if they don’t receive state aid and/or investor support (Financial Times)
• Honda president Takeo Fukui rules out a price cut on the Insight – after Toyota spiked its launch by announcing a discount on the Prius. Honda had pledged the Insight would be the world’s cheapest hybrid production car (Automotive News, subscription required)
Thursday 2 April 2009
• Jaguar Land Rover is taking on more than 40 apprentices as part of an £800 million investment to lower the CO2 (Jaguar Land Rover)
• The US market continued to crash in March, compared with a year ago – but there’s cautious optimism that we’re at rock bottom, and things could pick up soon. GM was down 45%, Ford 41% and Toyota and Chrysler slumped 39% each (Financial Times)
• Ford sold a third more cars in March than in February – 131,465 cars, sparking more optimism (The Times)
• Meanwhile over in Germany, the scrappage incentive is fueling a rise in sales: new car registrations jumped 11.9% in February. Critics argue car sales are damaging high-street spending, as consumer electronics sales fell 0.2% in the same period, according to the Bundesbank central bank (Financial Times)
• Federal aid should be pumped into Michigan as if the state had been hit by a natural disaster, a presidential advisor on the autos team said (Detroit News)
• Plenty of design chief movements this week: Peter Horbury is quitting his post as head of North American design at Ford to replace Steve Mattin as head of Volvo design. Horbury’s US post will be taken by Moray Callum (Automotive News, subscription required)
• Laurens van den Acker has quit as head of Mazda design ‘to pursue other interests’; he was appointed styling chief in 2006 and will be replaced by Ikuo Maeda, the man responsible for styling the RX-8 and 2 (Automotive News Europe, subscription required)
Wednesday 1 April 2009
• GM’s new chief exec Fritz Henderson confirms the company will have to close more car plants, lay off more workers and speed up a dealer network shake-up. ‘We need to reinvent General Motors and we need to do it in a very abbreviated time frame in 2009,’ he tells the FT (Financial Times)
• Union leader Tony Woodley reveals that GM has approached the UK Government for a £600 million aid package to rescue Vauxhall (Financial Times)
• Honda announces plans to cut North American production by 62,000 vehicles by mothballing factories for 13 days from May (Automotive News, subscription required)
• Fiat chief exec Sergio Marchionne is in Detroit to meet Chrysler unions and creditors, as the two companies race to meet the 30-day deadline on a proposed merger set by Barack Obama’s administration (Automotive News, subscription required)
• Former workers from car components firm Visteon are occupying factories in Basildon and Enfield, near London, and Belfast in protest at 560 job losses at the former Ford-run parts supplier (BBC News)
• The US’s United Auto Workers union has lost more than 33,000 members in 2008 – a new post-War low. It had 431,037 at the end of last year, as car makers shed staff (Detroit News)
• Click on the video player below to see Monday’s announcement by Barack Obama on the shake-up of GM and Chrysler and the new timetable for change
>> Click here for March 2009 Crunchwatch
>> Click here for February 2009 Crunchwatch
>> Click here for January 2009 Crunchwatch
>> Click here for December 2008 Crunchwatch