AD #1928 – VW Suspends Production Over Supplier Feud, The History Behind the 1st Camaro, Hyundai Teams with Amazon
August 22nd, 2016 at 11:52am
Runtime: 7:47
To watch this episode on YouTube click here.
- VW Picks the Wrong Fight
- Yeah, It’s Got a HEMI
- Skoda Puts the Gloves On
- Hyundai Teams Up with Amazon For Test Drives
- The History Behind the 1st Camaro
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On today’s show….Volkswagen picks a fight with a supplier and gets punched in the face….Hyundai teams up with Amazon to get car shoppers to take test drives….and an FCA exec shows us the fine points of street racing. All that and more coming right up on Autoline Daily.
This is Autoline Daily for August 22nd, 2016.
VW PICKS THE WRONG FIGHT
You really have to question the strategy and motives of Volkswagen’s top executives. The company is reeling from its diesel emissions scandal, which has the potential to financially cripple the company. And now it goes and picks a fight with a critical supplier. As a result, VW is closing 6 factories in Europe and laying off more than 27,000 workers because it can’t get parts to make cars. Bloomberg reports that a German supplier called the Prevent Group stopped shipping parts to Volkswagen because it’s angry that VW cancelled future contracts and refused to pay compensation for the work it already did to prepare for those contracts. It accuses VW of squeezing suppliers to help pay for its emissions scandal. The Prevent Group has two subsidiaries, one of which makes interior components and seat structures, the other makes castings and machining components. It wants about $66 million in compensation, and right now VW will be losing about 100 million euros a week due to the shutdown. Here’s our Autoline Insight. Volkswagen has some of the worst supplier relations in the automotive industry. It ranks dead last in the annual Planning Perspectives survey. It’s extremely unusual for a supplier to refuse to ship parts and these sorts of things don’t happen to automakers that have good relations with their suppliers.
YEAH, IT’S GOT A HEMI
As part of this past weekend’s Woodward Dream Cruise, a section of the avenue was closed down for drag racing. This was an homage to its past when Woodward was the Mecca of illegal street racing in Detroit. But this time around it was on the up and up. The event, called Roadkill Nights, was sponsored by Dodge and it was a huge success. About 350 cars paired up to race on the 1/8-mile drag strip. And about 30,000 enthusiasts showed up to watch it all. Mike Moran of Taylor, MI, won the top prize of $10,000, with his 1969 Dodge Charger powered by a 5.6L twin-turbo HEMI V-8. If you want to learn more about Roadkill Nights, check out our coverage of the event. And especially make sure you watch the interview with Tim Kuniskis, the head of passenger cars at FCA. You won’t want to miss the sick burnout he did in a Challenger Hellcat.
We like showing you the latest tricks of the trade and the newest technology when it comes to improving productivity on the manufacturing floor. And we’ve got another item to show you right after this.
SKODA PUTS THE GLOVES ON
Mazda’s Senior VP of U.S. operations, Robert Davis recently told us that the automaker could produce 100,000 more vehicles over 3 years if it was able to improve every factory worker by a tenth of a second. That’s one reason why automakers are experimenting with Google Glass and the Apple Watch in their factories. But Skoda is taking a little simpler approach. It’s using what’s called the ProGlove. It’s just a glove with a scanner mounted on top of it. But it’s able to show if a worker is using the right part and if the proper production steps are being followed. Little tricks like this can shave seconds off the time needed in each work station. And over the course of a year that can add up to real productivity gains.
HYUNDAI TEAMS UP WITH AMAZON FOR TEST DRIVES
There are all kinds of services available to Amazon Prime members, like ordering groceries. And now you can add test drives to the list. Over the next two weekends Amazon Prime members in the LA/Orange County area can book a 2017 Hyundai Elantra test drive at the location of their choice – house, work, coffee shop – it doesn’t matter. A subject matter expert brings the car to your location for up to an hour-long test drive. And then they direct you to the nearest Hyundai dealer if you like the car.
No doubt you were a hard core enthusiast when you were 18 years old. But coming up next we’re going to show you an 18 year old who probably has us all beat.
THE HISTORY BEHIND THE 1ST CAMARO
Logan Lawson is one of the luckiest 18 year olds around. He was able to track down and buy the first Camaro ever built. But at first there was no way to prove it was truly number 1, so he did a lot research to learn more about it. Logan joined us on last week’s Autoline After Hours and here’s some of the things he was able to uncover.
(The AAH preview is only available in the video version of today’s show.
There’s a lot of great info about the history of that car in the show, so check it out on our website, autoline.tv or look for it on our YouTube channel.
But that brings us to the end of today’s show, thanks for watching and please join us again tomorrow.
Thanks to our partner for embedding Autoline Daily on its website: WardsAuto.com
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Comments (16)
August 22nd, 2016 at 12:35 pm
It’s about time that vw got b!tch slapped,especially by a supplier.They seem to be on a self destruct thing.Amazing.
August 22nd, 2016 at 12:46 pm
Seems to me the standoff between VW and the Prevent Group could be great news for VW. If Prevent Group is contractually obligated to deliver supplies and they are refusing, that opens the door for VW to take them to court. With the damages VW is incurring a court verdict in their favor could have them taking over ownership of the other company.
August 22nd, 2016 at 1:01 pm
Hello Sean, Saw this video clip of the Camaro on AAH and said to myself, I was just at that place for the 50th Birthday party of the Buick Club of America. Looks like the Allentown Clasic Motor Car inc buildings owned by Nicola Bulgari. He actually has his Buick collection in Allentown, Pa. He started with a few repair and restoration garages and now must have maybe 7 garages, and he bought an old drive in Movie theater lot on union blvd by his garages and had it open to the public one day during the Buick event. Wow What a way to display you car collection.
August 22nd, 2016 at 1:12 pm
It really seems like the culture at VW needs s major overhaul, the days of ” do what I tell you and shut the fack up” are over, except at VW and a few other places, so maybe some of the suppliers are have had enough.
August 22nd, 2016 at 1:23 pm
#2 Marshall
You’d have a point if VW wasn’t in a breach of contract; failure on their part to pay for work done would most certainly give Prevent Group probable cause to cease (product shipments).
August 22nd, 2016 at 1:31 pm
VW is treating their customers the same as their suppliers. I’ve had issues with VW when I was an owner. Things that should have been covered such as a battery were denied even though the car was covered bumper to bumper.VW has a “Me only” attitude and it is finally catching up to them!
August 22nd, 2016 at 2:00 pm
with VW sales tanking this could be a good way to cut production without upsetting the unions
August 22nd, 2016 at 3:30 pm
This is from today’s transcript:
VW PICKS THE WRONG FIGHT
“You really have to question the strategy and motives of Volkswagen’s top executives. The company is reeling from its diesel emissions scandal, which has the potential to financially cripple the company. And now it goes and picks a fight with a critical supplier. As a result, VW is closing 6 factories in Europe and laying off more than 27,000 workers because it can’t get parts to make cars. Bloomberg reports that a German supplier called the Prevent Group stopped shipping parts to Volkswagen because it’s angry that VW cancelled future contracts and refused to pay compensation for the work it already did to prepare for those contracts. It accuses VW of squeezing suppliers to help pay for its emissions scandal.”
August 22nd, 2016 at 3:31 pm
@2: “Laying off 27,000 employees”: VW will suffer major damages because of this. The Prevent Group is a relatively small, privately held Wolfsburg-based company. If VW would have a case against them (about which I have no opinion since I do not know the facts) and VW would win: receiving a payment Prevent Group could afford or owning that company would be insignificant compared to the mega damage incurred.
August 22nd, 2016 at 3:33 pm
I think vw has bitten off it’s nose to spite it’s face.
August 22nd, 2016 at 3:47 pm
Typically when manufacturers make deals with suppliers, they own the tooling and all the commercial right to the parts made from the tooling. This is why GM was able to retrieve the tooling from their interior supplier a few weeks back. As much as I despise VW right now, I don’t know how the supplier can quit supplying parts if the contract is still valid. Holding VW hostage because of a future contract is not forthcoming should not affect the current agreements.
August 22nd, 2016 at 4:13 pm
I think this is where it all lays down:
“VW cancelled future contracts and REFUSED to pay compensation for the work it already did to prepare for those contracts.”
August 22nd, 2016 at 5:52 pm
It’s unbelievable that VW, a company that has been so successful, in so many ways, can try so hard to completely self destruct. The VW brand hasn’t done well in the US, but Audi has, and VW has done well about everywhere else in the world.
August 22nd, 2016 at 5:54 pm
I still like some of VW’s products, like Golf and Sportwagon, but there is no way I would buy one now.
August 22nd, 2016 at 6:19 pm
Jeeesh what tha heck is going on at VW.
August 22nd, 2016 at 9:33 pm
Just-in-time delivery is a two-edged sword and this time VW got sliced to the bone. And you can bet the VW Purchasing folks are thinking “we told you so” to their upper management who decided to play hardball and got the ball shoved down their throat. I’ve seen this more than once in my career when the top management think they know more than Purchasing and end up eating crow.