Episode 433 – Peugeot Reveals 508, UAW Protests Toyota Dealers, EcoMotors Gets Investment Money

July 13th, 2010 at 12:00pm

Runtime 7:01

Peugeot released some pictures of its new 508 large sedan ahead of this fall’s Paris Motor Show.  The United Auto Workers Union is launching protests at Toyota dealerships across the U.S. in an effort to scare away customers and organize the company.  Alternative power start-up EcoMotors is getting nearly $24 million from investors including Khosla Ventures, and, surprise, Bill Gates.  All that and more, plus a look at the luxury car sales race from BMW’s perspective.

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Transcript and Story Links after the jump . . .

This is Autoline Daily for July 13, 2010, and here’s the news.

Nissan unveiled its new subcompact, the March, yesterday, known as the Micra in other markets, but that wasn’t the big news. According to the AP, the company will build it in Thailand and sell it in Japan. Thailand offers lower labor-costs and a hedge against the stronger value of the Yen. This is a big deal for a Japanese automaker to import a mass-market car into Japan. Imports make up just 5 percent of Japan’s auto market and most of those are luxury vehicles. Japan built its industrial policy around automotive exports, so this is a sea change in what’s going on with that country’s auto industry.

Even though it won’t make its official debut until October at the Paris Motor Show, Peugeot is showing off some pictures of its new large sedan, the 508. There aren’t a whole lot of details to share but it will be available as a sedan or wagon. Some of the engine options include a diesel with start/stop technology and a diesel hybrid. Peugeot will build it in France for the European market and later in China for that market. The 508 goes on sale early next year in Europe.

The United Auto Workers Union is launching protests at Toyota dealerships around the United States in conjunction with Jesse Jackson’s Rainbow PUSH organization. They both say they’re working for worker and civil rights. Here’s my Autoline analysis. The UAW wants to unionize car plants owned by foreign automakers and Toyota is its first target. It hopes to scare enough business away from those dealerships that Toyota will finally relent and not oppose the union’s organizing efforts. The union believes if it can organize Toyota, it will be able to organize all the transplants and their suppliers, and that is something that could double its current membership.

EcoMotors, the start-up company with a revolutionary engine design, is getting $23.5 million from investors including Bill Gates and venture capital firm Khosla Ventures. The engine can reportedly double the fuel economy of a vehicle, yet do so at very low cost. Viewers of Autoline After Hours will remember that we had Don Runkle, the CEO of EcoMotors, on the show last year explaining what this engine is all about. You can find the link to that show in today’s script. I’ve seen a prototype version of the engine undergoing testing at Roush Industries, so the development is well underway. If this engine catches on, watch out all you other alternatives. It will not need government sales subsidies or any infrastructure investment to become viable.

THE BEST SALES EXPERIENCES (subscription required)
As always, you get what you pay for.  Ward’s reports that luxury brands ranked highest in the fourth-annual Prospect Satisfaction Index, an auto-retailing survey conducted by consultancy firm Pied Piper Management.  The organization hired 3,600 “mystery shoppers” to visit dealers around the U.S. and record their experiences.  Mercedes-Benz topped the list, with other premium marques like Lexus, Land Rover and Acura following closely behind.  Detroit improved the most, with both Ford and Chevrolet beating the average score.  Overall, the industry’s performance improved markedly, with 25 of 34 brands scoring higher this year than last.  Good news for car buyers, but this also means six of them fared worse than in 2009.  Mitsubishi came in last with Suzuki finishing one-spot higher.  It’s interesting how surveys like this mirror the troubles facing both companies in the U.S.  Hit the link in today’s show notes at AutolineDaily.com for more interesting information about the Prospect Satisfaction Index.

GM is giving Corvette fans a unique hands-on opportunity.  As its name implies, the Corvette Engine Build Experience lets buyers assemble their car’s engine.  Future Z06 and ZR1 owners can put together their own LS7 or LS9 smallblock V-8 at the company’s Performance Build Center in Wixom, Michigan.  Making this program unique, buyers don’t just watch their baby’s engine get built, they actually do it themselves under the watchful eye of factory technicians.  When everything’s finished, the powerplant is sent to the factory and installed in their car.  GM’s suggested MSRP for this all of this fun is a steep 58-hundred dollars!

BMW is ahead of all other luxury brands in the American market, but it says with what it has in the pipeline, next year will be even better. We’ll explain why it says that, right after this.

BMW is the top luxury brand in the American market, but it’s a tight race between it, Lexus and Mercedes-Benz. And BMW says it really isn’t quite up to full strength just yet because of all the new products it has coming, especially with the X3. Recently we caught up with Richard Brekus, the head of sales for BMW North America, and asked him to explain what’s going on.

Even though BMW is at the top of the sales charts for luxury cars so far this year in the American market, Mercedes and Audi are actually growing faster, so BMW definitely needs those new models.

And that is it for the top news in today’s automotive industry, thanks for watching, we’ll see you tomorrow.

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30 Comments to “Episode 433 – Peugeot Reveals 508, UAW Protests Toyota Dealers, EcoMotors Gets Investment Money”

  1. pedro fernandez Says:

    This Toyota news is really upsetting and it may backfire on these goons, folks will either go buy more Toyotas at the expense of govt motors, or Toyota will move some of their plants to Mexico where the UAW can’t touch them, If they come to my local dealer I will go there if just for an oil change and flip them off, freaking socialist goons, I hate them all.

  2. G.A.Branigan Says:

    Once again the uaw rears it’s ugly head.Talk about losers,the uaw wrote the book on it.You are right Pedro,yet more jobs lost due to a greedy out of touch union as factories move south of the border.Smooth move uaw.

  3. merv Says:

    I love the new corvette engine program. Thats about as cool as it gets.Sign me up.

  4. Alex Carazan Says:

    The $5,800 charge by GM for a customer to assemble their own engine is likely to pay for the 5 UAW workers to sit on their you know what to do nothing! Keep it up UAW and you will wish you took those spanish lessons in high school! Lucky for Mexico!

  5. Chuck Grenci Says:

    That 508 looks like so many other like-cars it’s scary; I guess everyone is building some sort of generic looking midsize (now I know why car companies have badges for their brand).

    The Vette engine program is so cool. What a great personalization that would make for your new ‘baby’; talk about embracing your purchase and making it your own.

  6. tJ Martin Says:

    The Reverend Jesse Jackson and the UAW . Now there’s a marriage made in Hell if there ever was one !

    Talk about two losers combining to create one Bigger Loud Mouth loser .

    If you ask me , what with five Trade Unions here in the Mid West going on what has now been a 14 month ongoing protest across the City : what I think is going on is that the Unions themselves are coming to the conclusion most of the civilized world has come to . That being the Unions have by their own doing become irrelevant and are more of a road block to progress than any real benefit to its Membership and this is all just a desperate . pathetic and futile attempt by the Unions to hold on to / or regain some power .

    Like Pedro Fernandez so well stated , these actions by all the Unions may just bite them hard in the rear end .

    FYI : Because of my profession there have been times when I’ve been mandated to be in the Union . And like Pedro Fernandez ( if not worse 0 I hate them . All they ever did was cost me money ( for the membership ) and lose jobs ( because of them demanding unrealistic pay scales )

    So I really hope when that Bite comes its deep , hard and fatal .

  7. John V Says:

    I can see the UAW at southern Toyota dealers trying to find someone who cares. The customers will show up in spite of them. It may even bring Toyota more business. I could see some dealers advertizing the opportunity to taunt a union member while waiting for service!
    Southern workers have never trusted unitons and hate the idea of giving up moeny for dues.
    As usual, Jesse Jackson, still searches for a cause.

  8. Kit Gerhart Says:

    Peugeot hasn’t done well at selling big cars for a long time, even in France, but I like the idea of the diesel hybrid they will have in the new 508. For years, I’ve been wondering why diesel hybrids haven’t been sold. OK, I’m sure the reason it cost, but diesel hybrids sound like a very good idea.

  9. Kit Gerhart Says:

    The UAW needs to organize the auto plants in China. That is where they are needed.

  10. dcars Says:

    This tactic could do some damage in western New York. GM spent a billion dollars here and it’s appreciated. Their is a local dealer that courted the UAW members and then opened up a Toyota dealership a couple of years later. This could get interesting.

  11. pedro fernandez Says:

    Just saw the report on the RR Ghost, which is built on a BMW chassis and power train,my question is: would it not make more sense to buy a 760 IL (same engine and transmission) and add all the wood and extra luxury options available from BMW and still be $150k less than the Ghost?

  12. Alex Kovnat Says:

    >The United Auto Workers Union
    >is launching protests at Toyota
    >dealerships around the United
    >States in conjunction with
    >Jesse Jackson’s Rainbow PUSH

    The very fact that the UAW has chosen to ally itself with Jesse Jackson, is enough to set off my bullsh’t detector. Jesse Jackson is known to be a shakedown artist. That the UAW would stoop that low, should be a disappointment to all of us.

    When one considers that it was the UAW’s rigid job classifications and work rules that helped bring about (even if not entirely caused) the Big Three to virtually collapse, I have no use for the UAW organizing Toyota or Honda. In the 1980′s, people who wanted small cars because they sincerely wanted to help the environment, chose Toyota or Honda. Why? Because the Big Three’s entries in the small car field were junk compared to Honda and Toyota.

    I will never forget nor forgive the UAW not only for making it difficult for the Big Three to build quality small cars, but also for actively lobbying congress to limit American consumer access to cars like the Toyota Corolla and Honda Civic. And now the UAW wants to organize Toyota, Honda and other transplants.

    If the UAW can’t make a case for unionizing foreign automakers without Jesse Jackson’s shakedown tactics, then to heck with them.

  13. Kit Gerhart Says:

    If you have infinite money to spend on cars, a Rolls-Royce is still very special, even though the 760 is as good of car. Actually, the 760 would drive better, because it would be lighter and have a lower center of gravity.

    Being built on the BMW platform makes the current RR’s much better cars than they have been in the recent past. They are not a good value, in the usual sense, but if I had Bill Gates’ money, I’d probably want one to go with my Ferraris.

  14. pedro fernandez Says:

    Rainbows are such things of beauty and nature, why spoil it by referring to the Jackson group as such, why not “JJ and his gang of goons” instead.

  15. C-tech Says:

    Those who do not remember their history are doomed to repeat it. As you go through your 40-hour work week, remember it was a union negotiation that made it the standard in the U.S. (although most of us here probably exceed that now). The UAW did not design and greenlight cars like the Cimarron, Versalies, Vega, Imperial (last generation) or those lousy “Quad-4″ engines. Many UAW members are hard-working and honest Americans who are earning a living for their family, putting kids through college, and spending money here in the U.S. Please keep that in mind and reconsider your “hatred” of the UAW.

  16. Kit Gerhart Says:

    The thing that bugged me in dealing with the UAW while at GM, was the work rules. You would sometimes need three or four UAW skilled trades people to do a job that I, a salary technician, could do myself in about five minutes, if allowed to do so.

    As far as wages, it’s a mixed bag. The American middle class is truly disappearing, as the high paying factory jobs go away. Auto workers, whether UAW or non-union people at transplants, are no longer customers for new cars. You can say that unskilled assembly line workers are not “worth” any more than ~$15/hours, but as someone who grew up in the 50′s and 60′s, I find it a little sad that things have changed so much over a short period of time, to where the people building cars can no longer afford to buy what they build.

  17. D. B. Says:

    I think we are witnessing the death sprial of the UAW. I wish I was in the market for a new car, I’d buy Toyota just to be able to cross the line.

    Hey UAW: The folks that would not buy Toyota because of a UAW protest outside the dealership are already over at the Ford/Chevy/ Chyrsler dealership! Folks who want Toyota (or any other well built small car) are too smart to be turned away by your puny efforts!

  18. pedro fernandez Says:

    Historians will look back at this time and realize that by allowing most of the manufacturing jobs to leave this country, the middle class here has been nearly destroyed while in countries like China its flourishing, hence the astronomical increase over there of car sales, while here, they have been dropping and will continue as the job situation worsens and the price of new cars go up.

  19. C-tech Says:

    Considering the total population in China, I wonder if the per capita car ownership approaches the per capita car ownership in the U.S.? I suspect Chinese factory workers are NOT the people buying up Buick’s, VW’s and Toyota’s in China, as compared to the U.S.

  20. Nick Stevens Says:

    All but one of you got it absolutely right with the lazy fat cats of the UAW. It is ALSO an insult to the early sacrifices of the labor movement to compare them to these bums, even the socialist dinosaurs would be offended if they are compared to the execrable, shameless extortionist Jesse Jackson (Alex Kovnat: Excellent comment about Bullsheet detector going berserk at the hearing of the clown’s name)

    The sole supporter of the UAW may have forgotten the Jobs banks (or whatever the name was for that shameful agreement between the UAW and the irresponsible morons at GM, which allowed UAW goons to sit 100% idle and get 100% of their salaries (without being on unemployment or anything) from the long suffering GM coffers.

  21. Nick Stevens Says:

    “# C-tech Says:
    July 13th, 2010 at 10:24 pm

    Considering the total population in China, I wonder if the per capita car ownership approaches the per capita car ownership in the U.S.?”

    As of today? You must be joking. Of course it is much less, BUT the total cars sold in CHina will ALWAYS BE more than the cars sold in the US (new cars). Even in 2009 CHina surpassed the US (for the first time) by 3 million new cars a year, and many are just as expensive as here, they are NOT Tata Nanos.

    Also, CHina has more than four times the population of the US, so EVEN if Americans own four times as many cars PER CAPITA than the chinese, CHina would still have more cars.

    ” I suspect Chinese factory workers are NOT the people buying up Buick’s, VW’s and Toyota’s in China, as compared to the U.S.”

    SO WHAT????? India is TEN TIMES WORSE, the population is the same as Chinas, but only a meager 1.5 million cars, most of them cheapo POS, wer sold there in 2009, vs the 13.5 million sold in CHina.

    UNless something very surprising happens, CHina is well on its way to become the SECOND (after the US) Locomotive of the WORLD economy, and in a few decades it would be the sole, dominant, economic power in the world.

  22. Nick Stevens Says:

    “where the people building cars can no longer afford to buy what they build.”

    In which other industries do we have to satisfy the arbitrary rule above, that the workers should be able to afford the products they made???

    Can Lear Jet or Yacht Builders workers afford their products? Can Boeing and Bombardier workers afford to buy their corporate jets?

    Can all those textile workers afford the ludicrously priced dresses they make for the fat cows in Washington DC (that’s where all the jobs growth has been the last two dismal years!!!)

    Just because that Econ Illiterate Nazi sympathizer (and dcecorated by Hitler himself) Henry Ford arbitrarily wanted his workers to afford his cars, instead of maximizing his shareholders (aka OWNERS) investment, does it mean we should require this of all current US industries, one century later?

    It is clear that the $64 Janitors at Delphi were 100% UNSUSTAINABLE. The times where a brilliant MIT-trained mathematician at U of M would get LESS, MUCH less, than an illiterate, lazy UAW idiot sitting on his fat ass, were not long ago (1970s!) but are NOT coming back again.

  23. Nick Stevens Says:

    Surprise-Surprise! (NOT!!!)

    “People “familiar with the findings” of NHTSA’s investigation into unintended acceleration in Toyotas tell the WSJ [sub] that after studying “dozens” of black boxes, the DOT has

    found that at the time of the crashes, throttles were wide open and the brakes were not engaged… The results suggest that some drivers who said their Toyota and Lexus vehicles surged out of control were mistakenly flooring the accelerator when they intended to jam on the brakes.

    Really? Could it be true? It wasn’t cosmic rays or a ghost in the machine causing vehicles to run completely out of control? We’re shocked. Shocked, we tell you.”

    Did you buy that nice Toyota when prices were dirt cheap after this ludicrous Media and idiotic Ray Lahood (Sec of Transp of the failed Obama Administration) Fiasco?

    No? Too bad, youy missed a HUGE, HUMONGUS opportunity. Kit Gerhart JUST made it, when he very recently bought his very excellent PRIUS.

  24. Nick Stevens Says:

    UAW: it could get much worse than Gettelfinger (Middlefinger) with his radical successor and his rhetoric:


  25. Andrew Charles Says:

    I have to agree with TJ Martin. Unions have an important role to play in protecting and advocating for employees, but along the way they managed to evolve into an extortion racket rather than an employee advocate. Closed shops gave the power with no need to provide the services they were created for. If you want to work you have to give the union their kickback, and they have no need to earn their dues. Workplace representation needs to be opened up to competition like any other service, and on an individual basis, not just craft by craft, and workplace by workplace.

  26. Rural Rick Says:

    Hey John, the Corvette Build Expreience looks like a lot of fun… BUT… will GM still warranty an engine they did not build?

  27. Kit Gerhart Says:

    I’d recently had hope that the UAW was finally moving into the 21st. century, and realized that the car business isn’t like it was in the 50′s and 60′s. Their getting Jesse Jackson involved makes glaringly clear, that we could not be so lucky.

  28. pedro fernandez Says:

    So if JJ doesn’t work out for the UAW who’s next? William Shatner, “The Negotiator”???

  29. Les Says:

    I’m a union worker and even I hate the worthless UAW along with Jesse Jackson!

  30. Steve Salis Says:

    The UAW must be stopped. They are responsible for more job loss and wealth destruction than the much villified Bernie Madoff. They have abused their monopoly for decades at the cost of 100,000′s of thousands of middle class jobs and played a significant role in reducing the implementation of best in class manufacturing innovations in the US.

    The UAW should spend time teaching their members the realities of global competition and motivating thier captive membership to be the best labor force in the world. Now they are just the most over paid and over protected.

    They are selfish and shameful and apparently hell bent on bringing down the rest of the US manufacturing labor force down to thier level.

    When they and thier membership are the best in the world, manufactuers will plead with the UAW to allow thier labor force to join them.

    Saddly I fear that day will never come.

    The UAW has prooven over the last few decades that membership means little job security, poor quaility products and an industry in decline.

    I will NEVER buy a vehicle built by the UAW and millions of others feel the same way.