June 6th, 2012 at 12:06pm
The Big Three are making a break for the border. GM, Ford and Chrysler close plants in Canada in favor of cheaper U.S. labor. The head of Fiat/Chrysler, Sergio Marchionne, is urging European carmakers to tackle overcapacity issues but the Germans say “nein!” The Honda Fit EV earned the highest efficiency rating of any electric vehicle by the U.S. EPA, Fit indeed. All that and more, plus John answers your questions in “You Said It!”
Welcome to Autoline Daily for June 6th, 2012, and as you history buffs know this is the 68th anniversary of the landings at Normandy. Now let’s get to the news.
Canadian auto workers are worried, and with good reason. GM is closing an assembly line in Oshawa, there are rumblings that Chrysler could close its land locked plant in Brampton, Ford closed its St. Thomas plant last year and will close an engine plant next year. So what’s going on? Canadian workers have a good reputation for quality and productivity, but they are expensive. With the Canadian dollar at parity with the U.S. dollar and with the Detroit Three able to hire new UAW workers at much lower wages than the CAW allows, more work is moving south of the border to the United States.
Fiat/Chrysler CEO Sergio Marchionne is calling for all automakers in Europe to form a united front to reduce overcapacity, which could reach 2 million vehicles in 2012. But German automakers are NOT playing ball. They’re all pretty profitable right now and don’t feel they need to make cuts. Besides, if Europe does not cut overcapacity it will weaken everyone else, so why should they take steps that would HELP their competitors? Currently BMW, Mercedes-Benz and Volkswagen are running at 90 percent capacity utilization. Other OEMs range anywhere from 60 to 75 percent, with Fiat, PSA and Renault at the bottom of the scale. Analysts doubt anything will change since that would mean job cuts. Some call Marchionne’s plan a “fairy tale.”
FIT AS A FIDDLE
The electric version of the Honda Fit just received the highest rating from the EPA for pure electric vehicles. It has a combined equivalent of 118 miles per gallon and its estimated combined range is 82 miles. The combined range for the Ford Focus Electric is rated at 76 miles, the Nissan LEAF at 73 miles and the Mitsubishi i is at 62 miles. Honda will begin leasing the Fit EV in California and Oregon this summer and then offer it in the East Coast starting next year.
A few years back there was a lot of hype over Indian truck maker Mahindra selling cheap pick-ups in the U.S. But now the company is being sued for fraud and conspiracy. Yesterday, a number of dealers in the U.S. filed a lawsuit claiming Mahindra intentionally delayed certifying its trucks in the U.S., even though the company claimed the trucks were ready for sale. Dealers spent $60 million on fees and upgrading facilities. The suit claims Mahindra delayed certification so it could break its commitments with dealers and look for other partners.
The number of diesel-powered vehicles offered in North America keeps growing, and if a report from Car and Driver is accurate, a luxury flagship will soon join the oil-burning ranks. BMW’s refreshed 2013 7-Series is expected to get a 3.0-liter diesel straight-six. Output could be anywhere from 265 to 308 horsepower depending on which version of the engine is used. It’s reported the company is still waiting on final approval from the U.S. Government to sell the diesel 7.
Coming up next, it’s time for You Said It!
Tony Gray saw our review of the Subaru Legacy which had all kinds of road dirt on it. “Boy, ya think Subaru could have taken five minutes to WASH that car before they gave it to you for your video review.” Actually, Tony, all our test cars are delivered to us gleamingly clean. But as we put those cars through their paces they get dirty. And sometimes we have to shoot them as is, if we don’t have time to take them to the car wash.
Ron Paris says, “What a shame about Johan De Nysschen leaving Audi North America. To me, he was the true face of Audi in America and I always found your interviews with him fascinating. He’s a real class act and a great loss to VW.” All I can say is that Audi’s loss is Infiniti’s gain.
Drew wants to know, “Did anyone else notice in the sales numbers that the Lexus RX outsold all Lexus cars combined?” You’re right Drew, as long as you’re talking about passenger cars. The RX accounted for 49.6% of all Lexus sales last month, but that’s been the case for quite some time. It shows how good a vehicle the RX is, but it also highlights Lexus’s vulnerability. It relies too heavily on one model and if anything happens to take the shine off RX sales, Lexus will be in trouble.
Brent saw our reports that the Mustang outsold the Camaro last month. “Wow, the Mustang finally caught the Camaro. However you can probably attribute that to early release of the 2013 redesign. Expect the Camaro to be on top again once the 2013 comes out.” Brent, it is going to be nip and tuck this year between those two cars. Year to date, the Camaro is only about 2,000 units ahead of the Mustang.
Speaking of the next generation Mustang, one of our viewers Sean Sweeny has been sending us his own renderings of what he would like the next Mustang to look like and I have to say, I really like his vision of what it could become, and I believe he’s got the right design cues for what will actually go into production.
Brett complains that “With the end of production of the Ford Ranger there is no longer a “small” pickup choice for Americans. I spoke with a friend this past weekend who just purchased a used Ranger and he told me he had to pay a premium for it, even with 70k miles.” Well Brett, there is no longer a small pick-up from Ford. But Toyota has the Tacoma, Nissan has the Frontier and GM is going to do face lifts on the Colorado and Canyon, so they’re going to be around for a while, too.
And finally Jim Haines says, “I really liked the Borg Warner ad at the break, I am glad to see somebody promote their products using Indy Cars to do it.” Boy, we just love it when our viewers say they love to watch our sponsors ads.
Be sure to join us for Autoline After Hours tomorrow at 6 pm eastern time. Our guest will be Dan Kapp from Ford advanced powertrain and the guy who will be taking EcoBoost to the next level. Join me and the Autoextremist Peter De Lorenzo for the best insider discussion in the business. And that wraps up today’s report. Thanks for watching, we’ll see you tomorrow.