July 19th, 2010 at 12:00pm
With so many auto factories being built in China, overcapacity could become a problem faster than anyone expected. Sales of used vehicles at auction are down for the first half of the year. President Obama test drives the Chevy Volt and comedian Jay Leno had some less than flattering things to say about it. All that and more, plus a look at the greatest gathering of Saab aficionados in the world.
Transcript and Story Links after the jump . . .
This is Autoline Daily for Monday July 19, 2010, and now the news.
OVERCAPACITY CONCERNS IN CHINA
Last week we reported that China’s auto industry will experience a “Golden Age” for at least the next twenty years with sales expected to reach 35 million units by 2030. But there are new concerns the industry could face big problems well before that. According to Gasgoo, with so many factories being built in China, overcapacity could become a problem faster than anyone expected. A recent report says production capacity could hit 32 million units by 2015, far exceeding previous estimates of 22 million. Adding to the concern is the fact sales are starting to slow, which fell 5 percent in June on a month-on-month basis.
SAIC-GM-WULING LAUNCH BAOJUN BRAND
But that’s not slowing down any car companies in China. Wuling, the joint venture partner of General Motors and SAIC, is getting ready to launch a new passenger-car brand, as we reported last August. The brand will be called Baojun, which means “treasured horse” in Chinese. GM says that this is also part of its multi-brand strategy for the Chinese market, which is becoming more segmented. No details yet on the car, but it’s expected to be priced as low as $5,000.
GM BUILDS R&D CENTER IN CHINA
In related news, GM announced that it’s going to build a new R&D Center in China to develop electric car technology, lightweight materials and alternative fuels. The AFP reports that the facility will have 300 engineers when it’s completed next year. GM says it wants to attract some of the best brains in the Chinese academic system and that it is now incorporating what Chinese consumers want in its vehicle architectures.
USED-CAR SALES DOWN
New-car sales in the American market are up year-over-year, but that’s not the case with used cars. Auto Remarketing reports that sales of used vehicles at auction are down nearly 7 percent for the first half of the year. However, a lot of that has to do with a shortage of good used cars. So even though sales are down, prices of used cars are up. On a dollar basis, sales are only down 2 percent so far this year.
EATON’S FUEL-VAPOR SEAL (subscription required)
Hybrids and extended-range electric vehicles are great for reducing gasoline consumption, but even in electric mode they emit fuel vapors because they use a conventional internal combustion engine. This can account for up to 20 percent of a vehicle’s hydrocarbon emissions. And now supplier company Eaton says it has a better system that seals those vapors in a tank and burns them off when the engine is running. Eaton says its new system is simpler, smaller and smarter which allows it to more precisely manage fuel vapor and help automakers achieve stricter emission regulations.
OBAMA TEST DRIVES VOLT
Last week President Obama visited Holland, Michigan, to kick-off construction of another battery plant in the state. He even got a chance to take the Chevy Volt for a spin. GM has really been hyping the car ever since the concept version premiered at the Detroit Auto Show a few years back.
LENO NOT GAGA OVER VOLT
But not everyone is sold on it. The Detroit News reports that comedian and TV host Jay Leno had some less than flattering things to say about it. He said, and I quote, “If you didn’t know, you might think it’s a Cobalt or a Camry.” A Camry?! Ouch! He also said “I don’t think there’s a lot of cachet in having the first one.” Looks like Leno’s no fan of EVs, at least not this one.
Coming up next, a look at the greatest gathering of Saab aficionados in the world.
Saab may have gone through a lot of changes the past year, but one thing that hasn’t wavered is the love that Saab owners have for their cars. The Autoline crew saw that up close this past weekend at the Saab Festival in Trollhättan, Sweden. Here’s Isaac Bouchard with that report.
We’ll have more on that event later in the week.
And that’s it for the most important news in today’s global automotive industry. Thanks for watching, we’ll see you tomorrow.