Episode 462 – VW Wants To Buy Alfa Romeo, 2012 Mercedes CLS, Mahindra Receives EPA Approval

August 23rd, 2010 at 12:00pm

Runtime 8:31

Volkswagen says it is interested in buying Alfa Romeo if it should become available. Mercedes-Benz revealed its brand-new 2012 CLS ahead of the Paris Motor Show. Indian automaker Mahindra has finally been given a green light by the U.S. EPA to sell its diesel pickups in America. All that and more, plus a look at Kia’s voice-activated infotainment system called UVO that is just hitting the market.

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This is Autoline Daily for August 23, 2010, and now, the news.

Fiat CEO Sergio Marchionne has made no bones about the fact that he’s sick and tired of Alfa Romeo losing money. He’s vowed to get it back in the black, or else! Well, now comes an interesting rumor out of Europe. Bloomberg reports that Volkswagen is interested in buying Alfa if it should become available. While other automakers are getting rid of brands, the German automaker keeps adding them. Now it has VW, Audi, Seat, Skoda, Lamborghini, Bentley, Bugatti, Scania and Porsche. So would Sergio ever sell Alfa to VW? Naaaaah.

General Motors stole a top marketing executive away from Hyundai. Chris Perry was named vice president of marketing for the Chevrolet brand. He had been vice-president of marketing for Hyundai Motor America, the job Joel Ewanick had before he left the company and ended up at GM. So now the top two marketing execs at Hyundai are at GM and I can only imagine the people at Hyundai are none to pleased with the way this ended up, while GM can rejoice that it has two of the best people in the business.

Chinese automaker BYD, backed by billionaire investor Warren Buffett, posted a profit for the second-quarter. Normally that’s a good thing but according to Reuters, it didn’t meet analysts’ expectations, and so its stock dropped after the results were announced. Further compounding BYD’s problems is a slow-down in sales. Earlier this month the company reduced its sales target by 200,000 units for the year. Also, some dealers have simply dropped out of its sales network due to high inventories that caused them to sell vehicles at a loss. And the company wasn’t too optimistic about the rest of the year, saying it expects sales to remain slow.

While things aren’t going well for BYD in China, the luxury-side of the market in the country is doing just fine. According to Gasgoo, luxury sales are up nearly 100 percent the first half of the year and analysts expect the trend to continue. Audi just announced it plans to double the number of vehicles in its line-up over the next five years. The company plans to have 35 models in the Chinese market by 2015, up from 16 this year. Audi expects to sell over 200,000 vehicles in China this year, several years ahead of schedule.

Mercedes introduced the CLS back in 2003, creating a whole new vehicle segment . . . the four-door coupe. Audi, BMW and even Hyundai are following its lead, introducing highly designed sedans. Ahead of the Paris Motor Show in October, Mercedes has revealed its brand-new 2012 CLS. And like the original, it’s a real looker. The company claims its design is similar to the gull-winged SLS AMG. Just like a coupe, the new CLS’ windows have no frames, plus the body is long and low. The car also features energy-saving LED headlamps. Inside, the dashboard is covered in hand-sewn leather and the air vents are galvanized with a satin-finish metal. From the pictures, everything inside looks top-notch.

In related news, reports coming out of Germany seem to indicate that next year Wolfgang Bernhard will become the head of Mercedes’ car division. Not surprisingly, the company denies these rumors calling them “pure fiction” and “completely unfounded.”

MAHINDRA RECEIVES EPA APPROVAL (subscription required)
Better late than never, right? The Wall Street Journal reports that Mahindra has finally been given a green light by the U.S. EPA to sell its pickups in America. The Indian automaker had hoped to offer a diesel-powered truck in the U.S. last-year in August, but it could not because it hadn’t received regulatory approval. Now it aims to have trucks on sale by December. Look for a version of the company’s Scorpio utility vehicle to follow, coming out late next year, and a hybrid SUV sometime by 2013.

In other Mahindra news, Bloomberg reports the company may take control of South-Korean automaker Ssangyong. The two companies signed a preliminary agreement earlier today to work together and share technology. Mahindra will help Ssangyong develop new product and modernize its lineup.

Voice activation is one way that automakers hope to cut-down on driver distraction. Coming up next we’ll show you how Kia is putting the technology to work in the new system that it calls UVO.

Ford came out with its Sync system nearly three years ago. Up to now no one has caught up to it, up to now, that is. Here’s a look at Kia’s system called UVO that is just hitting the market.

Over in Europe, Fiat also has a system it developed with Microsoft that is calls Blue and Me. No doubt other automakers will now be introducing systems like this.

Don’t forget to listen-in on the biggest party-line in the automotive world. Check out Open Line tonight, starting at 8 p.m. Eastern Time. You can join-in on the conversation or just listen to where it goes. Check out today’s show notes for the phone number and PIN to get in.

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

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43 Comments to “Episode 462 – VW Wants To Buy Alfa Romeo, 2012 Mercedes CLS, Mahindra Receives EPA Approval”

  1. pedro fernandez Says:

    Did VW learn anything from GM and Ford owning too many brands and all the problems they had?, While GA rejoices at the Mahindra news, smokey is saddened by another Hyundai traitor.

  2. Chuck Grenci Says:

    The Mercedes CLS is getting awful busy in its design and the rear view is way too much Asian influenced for my taste. JMO

    This in response to Kia’s voice command (and I include all the voice interfaces no matter whose company produces it); shut up and drive.

  3. G.A.Branigan Says:

    @ Pedro: Good morning,yup I’m happy as hell that Mahindra FINALLY got epa approval.But….not for the reasons you think.I will not buy the m&m diesel,but I do hope it sells well enough to bring in the big guns of auto manufacturers and their better designs and diesels.

  4. dcars Says:

    I think Volkswagen sees value and a multi brand strategy. It can be very profitable if done properly. GM lost it’s way in the 80’s and 90’s by not differentiating the brands significantly enough. I thought they were getting on track, but they ran out of time. Too bad. A well engineered sports car with the Alfa name could be a money maker and VW knows it. The same could have been said for Pontiac.

  5. pedro fernandez Says:

    GA I think Mahindra needs to up the ante to be competitive in this market, just making them cheap doesn’t cut it any more, but if it sells well, it will make the others bring smaller diesels here.

  6. tj Martin Says:

    VW’s desire to buy Alfa Romeo . Bad . Very bad . For once Marchionne is displaying a modicum of common sense and telling VW where to stuff it .

    I’m not just jumping for joy over a bloated Alfa Romeo body stretched and pulled over a Chrysler 300 or Jeep platform . But the thought of VW owning Alfa and running their Badge Engineering scam with an Alfa Romeo emblem on the front makes me somewhat ill .

    Mahindra P/U’s in the US ? Well from what my rural VT friends tell me they make a mighty fine Tractor so …… Maybe their pick ups will be OK as well .

    But like G.A. I do wish this would encourage other manufactures to bring over Diesels as well . Along with Toyota bringing us a mildly civilized Diesel version of the Land Cruiser 75 series .

    @Pedro ….. But boy is H/S going to be crying in his soup today . Another rat jumps the Hyundai ship for the General . Hmnn . Maybe like Whiteacre leaving GM …. These Hyundai defectors know something H/S doesn’t . And that I’ve suspected all along

  7. tj Martin Says:

    @Pedro ;

    To add a little perspective on Mahindra . Seriously their Tractors are quite good and have taken the Farm market over by storm . It was amazing how many local farmers were choosing ( and still ) are Mahindra over the other brands , including the Japanese Kubata in spite having to drive much further to find a dealer . when I asked why the answer was simple . Dependable . In expensive . Better service . Easier to DIY maintain .

    So if their P/U’s come even close I’m afraid the likes of Ford/Toyota/GM will be finding themselves in a bit of a fight for the low end P/u market .

    Honestly I’ve never seen so many Right Wing , Ultra Conservative Agro types jump on a foreign band wagon so quick in my life .

  8. Mike Duffy Says:

    Thank you broadcasting the episodes again. Just reading then doen not carry the same imnpact.

  9. pedro fernandez Says:

    interesting review of the Mahindra truck can be found at Pickuptrucks.com

  10. dcars Says:

    Hey TJ interesting review of Mahindra! The PU is kind of ugly witch could be and issue. Kubota is a pretty good brand, so that is high praise if Mahindra is better than them.

  11. tj Martin Says:


    I’m not so sure I’d go as far as to say the Mahindra tractor is better than the Kubota ( the Kubota’s from lawn to farm are a fantastic albeit somewhat pricey brand )

    But danged if those Mahindra’s didn’t take off like wild fire once the farmers etc. caught on .

    And don’t get me wrong . I’m not about to run out and buy a Mahindra P/U . I’m just saying that an awful lot of potential P/U customers are happily bouncing around in their fields on Mahindra tractors and I wouldn’t put it past them when the GM/ Ford ( few own Toyota’s ) is needing replacement to head over to the Mahindra dealer and take one of their P/U’s home .

    If the price is right ( I did mention the low end of the P/U market ) I doubt its funky looks will matter much .

    To reiterate though . what I’m hoping Mahindra coming on our shores brings about is a return by the other P/U manufactures to simple , down to earth and functional trucks . With Diesels !

  12. tj Martin Says:

    dcars ;

    Read the review on P/U trucks.com and Jalopnik.com . Also had a good look at all the photos on Google .

    I don’t know . The reviews are darn positive ( to the point of the reviewers being shocked how good it is ) And the looks ?

    Kind of ( depending on the model ) looks like a cross between a Jeep and a Toyota Tundra with a touch of Hummer tossed in for good measure . Not stunning or good , but not bad either .

    I think A) Mahindra will steal more than a few sales away from the big guys B ) Because of the price they’ll bring in an entire new buyer for P/U’s ( not a good thing ) and C) Will force the big guns to come up with some products to compete with
    Mahindra . Diesels and all .

    Jeeze I can’t believe I’m singing the praises of another new Import Brand . Especially in light of the fact that I’ve been thinking less brands would be better .

  13. pedro fernandez Says:

    As long as the Mahindra powertrain is good and reliable, the interior issues are easily taken care of. Just add a little better material and improve the assembly process, this seems to be a problem with Indian manufacturers as the Nano suffers from really cheap, poorly assembled interior. But yet, big diff in the price.

  14. Kit Gerhart Says:

    It will be interesting to see how the Mahindra pickups are accepted when people actually see and drive them. To me, “third world” vehicles add a certain charm when visiting “third world” countries, but I don’t think I’d want such a vehicle as a daily driver.

  15. pedro fernandez Says:

    Kit: people went out and bought the crappy Dumb car and even the disastrous Yugo simply because they were new and different. In the case of the Mahindra there’s no other mid size, diesel pickup I am aware of. As long as the body does not fall apart in rough roads and heavy use, it should do ok.

  16. tj Martin Says:

    Kit ;

    Just as a reminder . All those Mahindra Tractor owners all across the farmlands of the US in need of a new truck for themselves or their kids . Bet me more than a few of them don’t wind up being Mahindra Trucks first customers .

  17. tj Martin Says:

    Pedro ;

    If the trucks are half as tough as Mahindra’s tractors , durability ( other than perhaps the interior ) won’t be an issue .

  18. Kit Gerhart Says:

    Based on Mahindra tractors, I don’t doubt that the pickups will be reasonably durable. Also, they should sell ok when they first hit the market. A small diesel pickup makes a great amount of sense. Toyota should do it, and buy engines from VW if they don’t want to bother with getting their own diesels certified.

    What I’m saying is that after the novelty wears off, they are likely to be way too “rough around the edges” for many peoples’ tastes. If the fuel economy is really good, that will be easy to overlook. Has anyone seen any projections on the EPA ratings?

  19. pedro fernandez Says:

    I read online that the Mahindra 2.2 diesel should get 30 mpg highway. That’s about 5 or 6 over the current available mid-size offerings with a four banger.

  20. tj Martin Says:


    Lets hope ;

    A) -Toyota does start doing Diesels
    B) – Toyota does not buy their engines from anyone especially VW. Toyota’s Diesels are top notch
    C)- And I’ll keep hoping for that Land Cruiser Series 75 to replace ( or at least in addition to ) the over styled FJ Cruiser

    No EPA projections on the Mahindra that I can find .

  21. tj Martin Says:

    I guess Pedro’s search engine is quicker than mine . nice catch there Mr. Fernandez !

  22. tj Martin Says:


    Lets add a D) to my Lets Hope list .

    Lets also hope that Ford et al ( US automakers ) also get a clue and start offering a Diesel Mid/Small P/U .

    Seems to me the Ranger is just begging for one ! Simple . Straight forward little P/U . Stuff a Diesel into it and I’d guess Ford would have themselves a real winner . 2WD and 4WD please . Hmmn . Then maybe a nice , basic , again straightforward little SUV based on a Ranger Diesel .

    Go down that road and Ford could have themselves a long term , multi variation his on their hands .

  23. pedro fernandez Says:

    Don’t understand why these companies are so reluctant to put diesels in their mid-size trucks to me it’s a no-brainer. They also failed to put out good small cars in the 80′s and it opened the door for the Japanese to control the market. Once a fool….

  24. XA351GT Says:

    I’d have to say their reluctance is that in many areas diesel is 40-50 cents more than gas and too many stations still don’t carry diesel which puts you at the mercy of those that do. Also people have heard that diesels maybe a little more to maintain or that they are not familiar with how they differ from gas engines and worry about being taken my mechanics if and when they require maintainance . Then there are those that remember the big diesel push of the 80s when everyone jumped on it and you had noisy ,dirty vehicles that didn’t justify their higher price once the oil companies ran the price of fuel over gas .

  25. XA351GT Says:

    That should be “work” to maintain.

  26. tj Martin Says:

    XA351GT ;

    Good points on the lack of Diesel issues . Very good . Kind of makes one feel it is hopeless to get Diesels in the US.

  27. Kit Gerhart Says:

    tj Martin Says:
    August 23rd, 2010 at 5:20 pm

    “Lets hope ;

    A) -Toyota does start doing Diesels
    B) – Toyota does not buy their engines from anyone especially VW. Toyota’s Diesels are top notch”

    The thing is, while Toyota’s diesels may be top notch, there is no indication that they plan to certify and sell them in North America. VW’s diesels are also top notch, and they are already being sold in North America.

    I was being facetious about Toyota buying diesels from VW. Neither company would be interested in such an arrangement.

  28. Kit Gerhart Says:

    The Ranger is considered worst-in-class by almost everyone who has done road tests recently, kind of like Sebring/Avenger in mid-size sedans, but yes, I suspect it would sell pretty well with a 4 cyl. diesel that would produce 25/32 EPA numbers or something similar. It the price is right and the mileage good, you can overlook the ride, noise, crude interior, etc.

  29. Kit Gerhart Says:

    If VW did end up with Alfa, (and probably drop SEAT), it might be a good fit. All of the current Alfa by Fiat cars are transverse engine, front drive. That is, Alfas aren’t what they once were when they were rear drive sports cars. I suspect VW’s front drive power trains are at least as good as Fiat’s, and the build quality is better. Why wouldn’t Alfa would be better off as a VW brand than as a Fiat brand? Bentleys and Lamborghinis haven’t lost their “character” just because VW now owns the names.

  30. HyundaiSmoke Says:

    Not really TJ,

    Remember, Hyundai/KIA is a company set up to continue its mission and goals regardless of a staff change. If Mr Chung-HKAG CEO were to die tommorow (Hope Not), both Brands would still continue their current objectives moving towards the objectives of the future.

    The Mission is more important than the people with this conpamy, and that’s how it survives and thrives despite major management staff turnover.

  31. HyundaiSmoke Says:

    Ewanick and Perry are great guys, but lets see if they can translate their Hyundai success to GM.

    The Regal is a nice car, but its easer to sell a $20K 200 HP car (Sonata), than a $26K 183 HP car (Regal).

    Part of Hyundai’s sales rise is a hidden pent-up demand for Hyundais. People have been curious about Hyundais for years, and this new product is what will get those curious people to buy.

    I dont see people asking Buick, Cadillac, and Chevy questions like the way people ask Hyundai questions.

    I always get questions about my Accent. Not the rude “Ewww you bought an Accent” question by you old guys, but the “So you own a Hyundai? Is it reliable does it hold up right, all of that stuff people say about Hyundai is just crap right because youre a smart guy and we know you wouldnt buy crap?”

    Hyundai Uncensored I think was a way to address people’s curiousity. People havent been this curious about Hyundai since the days of Excel, and on that note I think Hyundai has finally come full circle in terms of reputation and willingness to buy.

    To the Indian Pickup:

    I dont know about the durability of this truck, but I do know that India’s 2nd and 3rd more reliable cars are Chevrolet. The Chevy Spark has 182 problems per 100 vehicles, which for an Indian produced car that’s UNBELIEVABLE.


    A Trusted Indian Source, is breaking that Mahindra and Mahindra have parted ways with Global Vehicles USA. If they say it, then it will be news in 1-2 days here in the US.


  32. C-Tech Says:

    XA351GT Says:

    I’d have to say their reluctance is that in many areas diesel is 40-50 cents more than gas and too many stations still don’t carry diesel which puts you at the mercy of those that do. Also people have heard that diesels maybe a little more to maintain or that they are not familiar with how they differ from gas engines

    I think the p/u truck market is different than the passenger car market as far as diesels are concerned. A number of current diesel truck owners would consider a smaller diesel truck. A number of small business owners would consider such a truck (look at the number of Sprinter buyers). Jeep sold every one of its Liberty and Grand Cherokee’s with diesel engines. To me it is curious that Ford offers a Ranger Diesel in Europe but not the U.S. If I were at Chrysler, its seems that the Dakota would be an idea candidate to install a 3.0L turbodiesel from Fiat. It could only help sales.

  33. Kit Gerhart Says:

    I just read at: http://blogs.motortrend.com/6228889/car-news/would-you-buy-a-22000-diesel-pickup-from-indias-mahindra/index.html
    that the Mahindra truck will have a mandatory automatic transmission. Yikes! A manual transmission is what would make this third world machine with its torque monster (for its size) diesel kind of fun. I can’t believe that an auto box will be mandatory.

  34. Kit Gerhart Says:

    C-Tech Says:
    August 23rd, 2010 at 9:49 pm

    “I think the p/u truck market is different than the passenger car market as far as diesels are concerned. A number of current diesel truck owners would consider a smaller diesel truck.”

    Something else that would be very useful is large pickups with much smaller diesels than the ~300 hp ones that are now sold. I see a lot of these running around, usually empty, and they make no sense at all unless towing about 8000 pounds. The current Ford/GM/Dodge diesel pickups get only slightly better mileage than gas version when empty or lightly loaded. Cummins makes a four cylinder version of the engine Dodge now uses. I should work great in a light duty pickup used for light duty, and should get much better fuel economy than the gas trucks.

  35. Andrew Charles Says:

    Hmmm, actually I think “Mahindra will help Ssangyong modernise its (Mahindra’s) lineup.” Mahindra lincensed the CJ Jeep many decades ago and for the most part the lineup isn’t much newer. Certainly Ssangyong has much more modern SUVs, new crossovers in development, a nice new large sedan, and modern Mercedes-based gasoline and diesel engines. Mahindra has somewhat primitive truck-based SUVs and pickups, and high-compression diesels with relatively anemic power levels (Mahindra’s newest 2.2 L produces just 116 hp, Ssangyong’s old 2.0 L, 148 hp).

  36. Kit Gerhart Says:

    C-Tech Says:
    August 23rd, 2010 at 9:49 pm

    “I think the p/u truck market is different than the passenger car market as far as diesels are concerned. A number of current diesel truck owners would consider a smaller diesel truck.”

    The car market would buy diesels too, if they were available. The percentage of diesels sold is very high for VW Golf and Jetta, even though VW seems to be artificially limiting the number of TDI’s imported. If Honda had followed through with their diesel cars, they would be selling a lot of them, assuming they would be competitive with the VW’s in fuel economy.

    Diesel fuel may cost 15-20% more than gas, but if you get 50% better mileage, it saves you money on fuel. A the diesel VW Golf and BMW 3 series get about 50% and 65% better fuel economy, respectively, than the gas conterparts in Consumer Reports tests. The difference in the EPA numbers is less, but still greater than 20% an all cases.

  37. Rafi Says:

    I have yet to see the 2012 M-B CLS in person, but from the pictures, to me, it looks like one of the ugliest cars ever made.

  38. Nick Stevens Says:

    I appreciate that this butt-ugly retro-50s small pickup with the weird grille (looks like a turban!!) has a DIESEL, but I am quite sure it will NOT fly in the US market, where far superior imported pickups, even the ones made in transplants like the Titan and the Tundra, have failed.

    Indian cars and trucks have HORRENDOUS reliability, and a foolish cousin of mine overseas saw it first hand when she bought a suzuki Maruti (they have the gall to export them to Europe!!!) and told me it was by far the WORST car she ever had or even ever seen anybody have!

    And, Pedro, the Yugo cost only $4,000, vs the $20,000+ Mahindras, and the “Dumb” had pefrect timing with the $4.50 gas, and once gas prices subsided and people found out what a POS it was, it bombed too.

  39. Nick Stevens Says:

    The MErcedes CLS, both the first and the new gen, is one of the worst value in all Luxury Cars. You could always buy an excellent E-class with less $ while the E-class based (but shrunk) stupid CLS had much less interior room and comfort in theback.

  40. Nick Stevens Says:

    “Mahindra will help Ssangyong”

    Like the lame leading the blind… or vice versa.

    Like in the Failed GM-Fiat marriage, “Porca Miseria!”

  41. Nick Stevens Says:

    COuld somebody give us a link or two for these allegedly good Mahindra Pickup Reviews? The ones I saw a few months ago were bad, really bad.

  42. Nick Stevens Says:


    Impressive, very powerful ( 200 HP, 369 lbft!) AND extremely fuel efficient (74 MPG??) Diesel Electric Hybrid from Peugeot.

  43. Kit Gerhart Says:

    A diesel hybrid is something that should have been done years ago. The Peugeot is a simplified design with the electric motor on the rear axle, but I suspect this biggish “crossover” makes an ideal first platform for the technology, with extra room for the hardware compared to a smaller, lower car.