August 19th, 2010 at 12:00pm
GM filed the paperwork yesterday to become a publicly traded company again. Kia released a handful of photos of its latest concept vehicle, called the POP, before its debut at the Paris Motor Show. Volkswagen is bringing its Phaeton luxury car back to the U.S. All that and more, plus a look at a Chinese bus concept that drives over the road and above traffic.
This is Autoline Daily for August 19, 2010. And now, the news.
TURNING IOU INTO IPO
As long expected, GM filed the paperwork yesterday to become a publicly traded company again, probably later this year. The document GM filed is over 700 pages long, laying out the strengths and weaknesses at the company. But it does not give any indication of how much money the company plans to raise or what the price of the stock will be. That’ll come later. So, should you buy GM stock when it starts trading again? Here’s a word to the wise. The Wall Street Journal points out that GM’s European operations need billions for restructuring, and that GM’s pension fund us under funded to the tune of $27 billion.
SUZUKI ON THE BRINK
Suzuki is in deep trouble in the American market. Suzuki’s sales are down close to 50 percent compared to a year ago, and now Bloomberg reports that 42 of Suzuki’s dealers have simply stopped selling cars. That’s out of 310 dealerships. Even the Suzuki Kizashi, a pretty decent compact car that was supposed to turn the company around has turned out to be a sales dud. To draw more attention to the car Suzuki and Road & Track magazine heavily modified a Kizashi and got it to go 203 miles an hour at the Bonneville Salt Flats. I give them an A for effort, but I think Suzuki could be on its last legs in the American market.
NOW FIXING ALL MAKES, ALL MODELS
Here’s an interesting trend. In order to bring in more business, some dealerships are now servicing all makes and models, not just the ones the dealership sells. According to Ward’s, these dealers argue that a technician has the skill to fix any vehicle and they can easily get data or other specialty parts from independent sources. One Honda dealer is also offering customers the choice of either a genuine Honda part or an aftermarket part when doing repairs. The dealer found that he could get more business this way since most customers don’t want to pay for the OEM part and would go elsewhere to have the part fixed.
KIA POP CONCEPT (subscription required)
Automakers are gearing-up for the Paris Motor Show which kicks-off late next month. Expect a flurry of teaser photos and early reveals in the coming weeks. One of the first automakers to tip their hand is Kia. Ward’s reports that the South-Korean car-builder released a handful of pictures of its latest concept, called the POP. It’s a wild looking two-door, three-seat electric vehicle with an overall length of just three meters. Check out those oval-shaped window cutouts! It features a panoramic clear roof and a bulging rear hatch. I’m sure we’ll get more details in the coming weeks.
PHAETON COMING BACK TO U.S.
How does that old saying go? If at first you don’t succeed, try, try again? According to Bloomberg, Volkswagen plans to reintroduce its Phaeton luxury car in the U.S. The high-dollar sedan was pulled from the market back in 2006 after it failed to meet sales expectations. So, why is the company making such an expensive gamble again? The U.S. is one of the most profitable markets in the world – especially for luxury cars – and the Phaeton could help VW achieve its goal of tripling its share by 2018. Unfortunately, its global performance last year was not very encouraging. Sales were down 27 percent to 4,500 cars. Now, the company just restyled the Phaeton, and the updated version went on sale in Europe last June, but will that be enough to woo American buyers? Here’s some my Autoline Insight. Bringing back the Phaeton could allow Audi to move further up-market, allowing it to pull ahead of archrivals Mercedes and BMW.
Traffic jams are turning into a major headache in China, but one company has come up with an amazing idea of how to overcome the problem. Well, maybe it’s not so amazing. In fact, maybe it’s stupid. We’ll show you what we’re talking about, right after this.
CHINA’S 3-D FAST BUS
With car sales booming in China, traffic jams are becoming a big problem, and it’s only going to get worse. But one company has a very unique solution to help alleviate the problem. According to Gasgoo, the Shenzhen Huashi Future Parking Equipment Company, is building what it calls the 3-D Fast Bus which will literally drive over traffic.
The vehicle carries passengers 14 feet above street-level and can run on rails built in the road or wheels programmed to stay on the lines on the road. The bus can move up to 1,200 passengers while traffic passes through underneath.
The bus will use lasers and ultrasound to alert drivers when it’s getting close. It’s electrically powered by both solar panels and batteries which would recharge at each station.
The company says each vehicle costs about $4 million to manufacture. Sounds pricey, except that the up-front costs are about one-tenth of a subway system. And while this seems like science fiction, the company says construction on a six-mile test run will start at the end of the year and that a 75-mile stretch is scheduled to begin construction next year.
However, government officials say a contract is still being negotiated and is likely one to two years away from beginning. Other experts say this is a hare-brained scheme that will be impossible to pull-off because there’s no way you can avoid accidents with cars running under busses.
And that is it for today’s report on the top news in the global auto industry. Thanks for watching, we’ll see you tomorrow.