Episode 973 – Ford and CAW Reach Deal, European Sales Slide, Intake Valve Lift Control

September 18th, 2012 at 12:15pm

Runtime: 8:20

Ford and the Canadian Auto Workers Union have reached a tentative agreement for a new labor contract. Vehicle registrations in Europe dropped 8.5 percent in August versus the same month in 2011. GM’s 2.5-liter EcoTec four-cylinder engine features the company’s new Intake Valve Lift Control system. All that and more, plus a look at which vehicles are flying off dealer lots the fastest.

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Hello and welcome to Autoline Daily. It’s Tuesday, September 18, 2012. Summer is rapidly winding down and it’s starting to get a little bit cool up here in Detroit. I’m Michelle Krebs, Senior Analyst at Edmunds.com bringing you the latest car news. And in the second half of the show we’ll take a look at which vehicles are selling the fastest.

FORD AND CAW REACH DEAL (subscription required)
But first, Ford and the Canadian Auto Workers struck a tentative agreement for a new labor contract. According to the Wall Street Journal, the four-year deal reduces the starting wage for new hires and extends the period when they’ll reach higher wages. It also eliminates cost-of-living increases and freezes veteran workers’ pay. In exchange, current employees won’t have their wages or pensions reduced. And Ford agreed to create 600 new jobs over the life of the contract. The CAW hopes to use this contract as a framework for deals with General Motors and Chrysler. Its contract with the two companies ended yesterday but the union has “indefinitely” extended a strike deadline as it negotiates with the two companies.

The overall European economy is a mess right now and that turmoil is having a big impact on the automotive industry. The latest sales figures are in, and they aren’t looking good. New-vehicle registrations dropped 8.5 percent in August versus the same month in 2011. Sales for the calendar year are off about 6.6 percent. Germany was one of the few bright spots in Europe, but not even this mighty economy is immune to the downturn. Sales dropped 4.7 percent. The August performance marks the 11th consecutive month of decline, and the European Automobile Manufacturers’ Association projects car sales will be at a 17-year low by year’s end.

The Nissan DeltaWing racecar received a lot of attention when it competed at this year’s 24 Hours of Le Mans. Unfortunately the car did not finish the race, but now the DeltaWing gets another shot to compete. It will race at next month’s Petit Le Mans at Road Atlanta, a 1,000 mile 10-hour event. And we could be seeing more of the DeltaWing in the future. It can race in the 2013 American Le Mans Series and a provision will be made for the car as part of the merger between ALMS and the GRAND-AM series in 2014.

Last month we reported that gasoline prices in some parts of Italy were as high as $9.50 a gallon. Now Bloomberg reports this has caused sales of natural-gas and propane-powered vehicles to skyrocket. Sales of those cars are up 90 percent this year and now account for more than 11 percent of the Italian market, more than double what it was a year ago. This is one of the bright spots in the Italian car market, as overall sales are down 20 percent this year. See, I told you Europe was in trouble!

The Feds have officially rated the 2013 Ford Fusion Hybrid. This stylish family car is driving away with segment-topping fuel-economy honors. It’s an efficiency triple play, a hat trick, a turkey if you will. The U.S. EPA has officially certified the car at 47 miles per gallon in the city and 47 on the highway for a combined score of, you guessed it, 47 miles per gallon! That’s about 5 liters per 100 kilometers for all you metric folks out there. Ford is eager to trumpet the Fusion Hybrid’s economy advantage over the Camry Hybrid. It delivers 8 MPG more on the highway and 4 more around town than the Toyota.

The next-generation Chevy Impala gets a comprehensive overhaul for the 2014 model year. Along with a stylish new body, it has also received extensive work under the hood. The car’s available 2.5-liter EcoTec four-cylinder engine is getting some fancy technology to make it more powerful and efficient. It features the company’s new Intake Valve Lift Control system, I-V-L-C for short. What does it do? Well, it varies how far the engine’s intake valves open. There’s a low-lift setting for light loads and low engine speeds. This helps generate torque. When greater output is required, the system shifts over to a high-lift cam lobe, which helps maximize airflow through the engine. This gives drivers the best of both worlds. Overall it’s a very clever design.

Coming up next, what vehicles spend the fewest days on dealer lots? I’ll give you the inside scoop right after the break.

What were the fastest sports cars sold last month – or, at least, the ones that were sold fastest off dealership lots?

The answer is Toyota’s Scion FR-S, Subaru’s BRZ and Hyundai’s Veloster. The trio represents a winning formula of size and price for young, recession-weary buyers who to put some fun back into their driving.

The FR-S and the BRZ topped the list of quickest-selling vehicles in August, according to Edmunds.com’s analysis. And the Veloster was right up there as well.

The limited-volume FR-S and BRZ are entry-level, rear-drive sports coupes that are attractively priced at about $25,000. The pair share underpinnings, were jointly developed by Toyota and Subaru and are built by Subaru.

They have been among the industry’s quickest sellers ever since they went on sale in the spring. In August, the typical FR-S and BRZ sold in just 11 days and the Veloster in a mere 17 days, according to Edmunds.com’s calculation of days-to-turn. That is, the number of days from a vehicle being dropped off at a dealership by the car hauler to when it is driven away by a paying customer.

For comparison, the industry average days-to-turn in August was 58 days.

Another Subaru – the Subaru Impreza – was right behind the FR-S and BRZ in flying off dealership lots. The Impreza is driving Subaru to its fifth consecutive year of record sales. In the past five years, Subaru sales have soared a whopping 75 percent.

Some Detroit iron made the fastest-selling list in August as well – something that doesn’t happen every month. The new Chevrolet Spark is turning very quickly. It’s already out-selling the more established Toyota Yaris, and it is still only available in 18 markets. It goes nationwide by year-end. The flagship Cadillac XTS sedan has been on the fastest-selling list for a couple of months since it went on sale in June. It could be in even scarcer supply if the Canadian Auto Workers union decides to strike GM as the XTS is built in Oshawa, Ontario. And from Chrysler, the Dodge Dart is turning in an average 17 days.

But while sales may be UP our time is nearly OUT. Again, I’m Michelle Krebs, Senior Analyst at Edmunds.com. Thanks for watching, listening or downloading. I’ll see you later. Bye!

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30 Comments to “Episode 973 – Ford and CAW Reach Deal, European Sales Slide, Intake Valve Lift Control”

  1. dcars Says:

    CNG is the fuel of the future. It’s cheap and doesn’t require a lot of expensive equipment to make it clean.

  2. G.A.Branigan Says:

    Good job Michelle.It looks like Subaru isn’t exactly a niche segment anymore,good for them.And Caddy finally has something that flies off the lot.Hey Lincoln……..what do you have?

  3. HtG Says:

    You wonder how many former Volvo and Saab owners left the old country for Subaru.

  4. G.A.Branigan Says:

    @ 1: The only problem with cng is availability,which it just isn’t around where I live.However,propane is,and I would do that were the oem’s making that an option when ordering.

  5. pedro fernandez Says:

    Michelle failed to mention an article she wrote about the youth’s lack of interest in driving or buying cars, they rather take public transportation or use one of those Zip Cars systems, very disturbing news for the car industry. They prefer to stay put and text away.

  6. pedro fernandez Says:

    Subaru lost some momentum with the popularity of the SUV, but since the spike in gas prices and the unpopularity of the segment, they’ re really the only affordable all-wheel drive vehicle out there. Plus the fact that they have maintained their safety reputation throughout the years.

  7. Kit Gerhart Says:

    Those are impressive mpg numbers for the Fusion hybrid. I’m curious about two things. How will it do in real driving compared to the Camry. Probably CR will be the best source of information, but there should be a few other attemps at controlled comparisons.

    Also, why does the Fusion (and C-Max) get such good EPA numbers? Do Lipo batteries have that much more efficient charge-discharge cycles, does Ford have more efficient motors or controllers, or ?

  8. G.A.Branigan Says:

    Subaru builds a quality product,hence the loyalty few other oem’s can get from their customers.That is especially true in states that have real winters.They build a damn fine vehicle.

  9. Kit Gerhart Says:

    Subaru rules me out of considering their products, except one, with their mandatory 4wd, but I agree that they have a nice lineup of cars, and car-like crossovers for those who want 4wd.

  10. C-Tech Says:

    A 4 year contract with the CAW? If you listen closely, that’s the sound of shovels going into the ground in the U.S. and Mexico. Plant expansion and new plants are coming for Ford. Canada will look like Janesville, Wi.

    With the decline in Europe, is it possible for the big 3 to use some of that excess capacity to ship vehicles to North America?

  11. W L Simpson Says:

    If CNG, et al, goes big time, the traders will
    embrace it & run the price up accordingly.

  12. pedro fernandez Says:

    #10 Are you referring to right to work states? where there is no UAW? I prefer that over going to Mexico, this way Americans can build Fords, this would leave the Fiesta as the only Mexican-built US Ford, I believe

  13. Kit Gerhart Says:

    I think some F-series trucks sold in the U.S. are from Mexico.

  14. pedro fernandez Says:

    Kit Wikipedia does not say where they’re built, but I thought they were built here, the Flex and the Fusion are also being made in Mexico, but I believe they’re moving the Fusion to Mi. I don’t know what will happen to the Flex

  15. Kit Gerhart Says:

    See: http://en.wikipedia.org/wiki/Ford_F-Series_twelfth_generation

    Also, in the last year or so, I have seen a Mexican F-150 at a dealer, but I don’t remember which configuration.

  16. Kit Gerhart Says:

    I suspect the Flex sill go away in the next year or two, and not be replaced. I kind of like it, except for being so big, but it is not selling very well.

  17. C-Tech Says:

    @ #12-14
    I believe the big three will expand existing plants, while other manufacturers will consider Mexico and the Southeast U.S. The Fusion will be built at the Flat Rock Mi. plant. Since the big 3 have UAW contracts anywhere a plant is built, the other logistics are more relevant than a right-to-work state.

  18. C-Tech Says:

    @ #16 To me the Flex looks like a BIG Mini. Coincidence why you like it Kit?

  19. Kit Gerhart Says:

    I think it looks like a really big first generation Scion xB, but I like that one too.

  20. pedro fernandez Says:

    #19 1+ It has a polarizing design, most people don’t like it, those who buy it, love it!

  21. Bradley Says:

    Subaru attributes increasing the belt line of their cars has increased sales, but its their smallest car sold in the USA that makes sales headlines. I love Subaru, but I miss the smaller funky side.

  22. Leonard Fedoruk Says:


    How about you have a different guest host once a month to anchor Auto Line Daily?

  23. G.A.Branigan Says:

    My first subie was a 79 gl wagon,fwd.I drove it till there was little left to drive.I loved that little wagon.

  24. XA351GT Says:

    For all those FR-S ,BRZ and velosters sold I see very few on roads here in SE PA. I’ve seen Sparks on the local lot never one on the road.
    Same with the Dart.

  25. Chuck Says:

    #23… Same here in the upper Midwest.

    Very few around here in the land of the pick up truck. There are days when it’s like if I see one more F-150 I’m going to flip out!

  26. Kit Gerhart Says:

    They aren’t selling Spark yet where I am in Indiana.

  27. Jesse W. Henry Says:

    THe rating for the new Fusion Hybrid makes things interesting now with it being the same as the C Max. If you don’t need a hatch back the Fusion is a much nicer car than the C Max for similar money…

  28. Kit Gerhart Says:

    I haven’t seen either a C-Max or a new Fusion, except at the NY auto show. I guess they are both late arrivals where I am in central Indiana. The same applies with Spark.

  29. pedro fernandez Says:

    So Kit, you come to Fla for the winter?

  30. Kit Gerhart Says:

    Yep, usually on the third weekend of October. Cape Canaveral.Cocoa Beach area.