Episode 251 – VW’s Porsche Battleplan, Ford Catches a Spy, BMW’s Green Casting Foundry
October 16th, 2009 at 12:28pm
Runtime 7:35
A look into Volkswagen’s complex strategy to acquire Porsche. Ford catches an industrial spy who tried to use confidential documents to get a job at a Chinese company. BMW prepares to open the world’s first and only emissions-free metal casting foundry. All that and more, plus a preview of Autoline Detroit with Alan Taub, and the winner of this week’s Trivia Contest.
Transcript and Story Links after the jump . . .
Here are today’s top headlines, more details about the Volkswagen/Porsche alliance emerge, Ford battles industrial espionage, and BMW pioneers a greener metal casting process.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Friday, October 16, 2009. I’m Kate Linebaugh from The Wall Street Journal sitting in for round two as host of Autoline Daily. And now, today’s news.
For some time we’ve know that Volkswagen is trying to acquire Porsche. Now we’re learning just how they plan to do it. And it sounds about as complicated as one of those Porsche double-clutch transmissions.
In a story from our bureau in Frankfurt, Germany, the Wall Street Journal is reporting that VW will ask shareholders to approve the sale of 135 million new non-voting preferred shares that’s expected to raise 10 billion Euro, or just under 15 billion dollars. Volkswagen is taking this extraordinary step to both maintain its financial flexibility as well as protect its credit rating during this complex merger.
The shareholders will meet in about a month and a half — December 3 to be precise — and we’ll let you know what happens then.
As you might’ve seen mentioned on last night’s weekly webcast “Autoline After Hours,” an alleged industrial spy was caught yesterday in Chicago. Mike Yu, a former Ford Motor Company engineer, was arrested at O’Hare Airport as he tried to re-enter the country from China.
A federal indictment says he copied confidential Ford documents and took them with him when he left in 2007 for a subsidiary of a Taiwanese electronics company. He’s accused of using the materials to try to obtain a job with a Chinese company.
Why he returned to America at this point is a not known. However, it’s no mystery the penalties he’s looking at — up to 15 years in prison and as much as a $500,000 fine. By the way, Ford says it’s co-operating with authorities on the continuing investigation.
Speaking of China, its largest automaker, SAIC, is in talks with its partner General Motors about expanding its business. According to Reuters, SAIC is interested in taking a stake in General Motors’ Indian operations and deepening their ties elsewhere. No details yet on what else they might do. SAIC and GM jointly produce Cadillac, Buick, and Chevy models in China.
Next year BMW’s foundry in Landshut, Germany, will be the first in the world capable of doing emission-free sand-core casting. The company is switching from organic to INORGANIC binders – the stuff that holds the sand together. That will reduce combustible emissions by 98 PERCENT. As a bonus, this new process should result in stronger parts and lower energy consumption. Before, tools used in the casting process had to be blasted with dry ice after each use to remove combustion residue, but not anymore. Right now BMW’s Landshut facility produces around 1.8-million aluminum and magnesium castings each year and is poised to be the first in the world to use this process in volume production.
Ahead of next week’s Tokyo Motor Show, photos of Toyota’s FT-86 concept have hit the web. According to Autoblog, the sporty four-seat, two-door is the result of collaboration between the big “T” and Subaru. The car is expected to have a 2.0-liter boxer engine with around 200 horsepower and all-wheel-drive – no surprise there since it’s based on the Impreza platform. The FT-86 is unusually stylish for a Toyota, and it may make good on President Akio Toyoda’s pledge to make cars that are fun to drive. We’ll keep you posted as we learn more.
While they do work, speed bumps are extremely annoying. That’s why Mexican company, Decano Industries, is developing what they call “smart” speed bumps. According to USA Today, the speed bumps retract into the ground if the driver is going the speed limit or slower, if not, the bump will remain up. each bump is made of two plates that stick up to form a triangle and a sensor that measures the force of the impact of the vehicle. The device doesn’t use electricity, costs 1,500 dollars to install and will last about ten years. A pretty innovative way to reward people for following the speed limit.
Coming up next, a preview of this week’s episode of Autoline Detroit, we’ll be back right after this.
On this week’s installment of Autoline, John McElroy sits down with Dr. Alan Taub, GM’s Vice President of Research and Development. Joining in the discussion are Paul Eisenstein of TheDetroitBureau.com and Sam Abuelsamid of Autoblog. In the following clip, Dr. Taub talks about how the company continues to invest in advanced battery technology for the Chevy Volt, as well as how it’s continuing to push hydrogen as a future fuel.
If you like what you saw, or just want to learn more about some of the advanced technology GM is working on, you can watch the entire episode of Autoline on our website.
OK, it’s Friday and that means it’s time announce our weekly trivia winner. We challenged you to another installment of “Name that Car!” And here it is. It kind of looks like a Suzuki, but it’s not, it’s actually the Daihatsu e:S concept, which stands for Eco-Smart. As always, we picked the winner’s name at random from all the correct answers, and the lucky person is: John Malone from Philadelphia, Pennsylvania. Congratulations John, you’ve just won this lovely Eyes on Design poster.
Anyway, that’s it for today’s top news in the global automotive industry. Again, I’m Kate Linebaugh from The Wall Street Journal, thanks for watching, and have a great weekend.
Thanks to our Partners for embedding Autoline Daily on their websites: Autoblog, The Auto Channel, vLane, WardsAuto.com and WWJ Newsradio 950
Share
Embed
Permalink
Comments (44)
October 16th, 2009 at 12:46 pm
There we go again, them Chinese showing the world who they really are, nice job, Kate. (John, better get back soon)
October 16th, 2009 at 1:03 pm
Even the NYT gets is! (from TTAC today)
“Yesterday’s New York Times published an article dissing Detroit in the Breakingviews.com bit of their Business Section. In a stunning if perhaps singular piece of journalism, the Gray Lady affirms TTAC’s nine-year rant record of castigating Chrysler, Ford and GM for refusing to remove their rose-colored glasses. In fact, Anthony Currie calls Motown’s mavens a bunch of deluded, delusional and/or deluding dunces—albeit in that gently chiding, hugely condescending, entirely arch way that typifies the Times.” Read More Here.
[Note from the Editor: This comment has been edited to remove the rest of the article posted here, not because we don't agree with it, but because the comments section is not a place to republish entire articles wholesale from other websites. It makes a mess of the page, and it could be construed as plagiarism. Multiple excerpts and links are acceptable. Thank you.]
Now when either I or Nick Stevens or a few others here say the above, we are attacked by the Polyannas and the Wishful thinkers. So today I will just quote others saying the very same thing, and those of you that called us “curmudgeons” and “tiresome”, go bark up THEIR tree, not mine!
October 16th, 2009 at 1:23 pm
Kate did a great job today. She seemed much more at ease than her rookie show.
The FT86 better come to the party with more than 200hp or it will remain a fixture of the secretarial pool.
October 16th, 2009 at 1:37 pm
John McElroy,
Any chance you could provide a framework of the next interview with Dr. Alan Taub from GM with the possibility of viewers submitting questions that you could pose to him ?
Re:”On this week’s installment of Autoline, John McElroy sits down with Dr. Alan Taub, GM’s Vice President of Research and Development.
“Thin Air” (Show #1335) air 10/16/09
Dr. Taub, with all due respect, do you really think the automotive/government “tail” is going to “wag the dog” when it comes to EV range and buying and sharing specialty vehicles ?
I think John McElroy has it right. It will take a huge spike in oil prices. To change consumer demand for utilitarian shared vehicles.
But, a huge spike in oil prices will DESTROY everything that is left in this fragile, sinking, non-job producing, “economy”.
Somebody should do some “R&D” with Google on the search terms of:
Cloward Piven
http://www.google.com/search?q=cloward+piven
October 16th, 2009 at 2:08 pm
“..and it could be construed as plagiarism. ”
Note to Editor: Are you sure you got the definition of Plagiarism correctly?
I not only put the article and its discussion in quotes, I also properly attributed my post to its two sources (NYT and TTAC).
Therefore, it is extremely unlikely that anybody would complain of plagiarism.
October 16th, 2009 at 2:12 pm
Jim,
It is not just websites like TTAC or even the NYT, our criticisms of the domestic Automakers are nothing unusual, but instead agree with the opinions of the most knowledgeable people in the business, such as the brilliant former Editor of Car and Driver Czaba Czere, and most of the other guests at Autoline After Hours.
I never hear the Polyannas complaining at them (they only complain about the low reliability ratings of utterly unbiased COnsumer Reports mag, but not when big 3 cars do poorly on C&D tests)
October 16th, 2009 at 2:18 pm
Whoa Kate, us car guys can’t stand the complexity. VW is going to dilute shareholders to raise money to buy Porsche? Oh my mind! It burns. Please please talk slower Kate.
October 16th, 2009 at 2:22 pm
Actually today I did not bother to see the video, after a few seconds I changed page and read it from the transcript, which took me much less time!
I did listen to the video of Dr. Taub, he sounded quite serious at first, but when you add the economics and cost equations, it is not serious to still talk about fuel cell vehicles today.
October 16th, 2009 at 2:53 pm
VW should learn from GM and Toyota’s greedy ideas which is hurting them, and just concentrate on improving their quality and reliability, that’s what is keeping them from selling more vehicles.
October 16th, 2009 at 3:03 pm
In the US, VW is widely perceived as unreliable, and it may be true. In Europe, they are premium cars in their class, command much higher prices, and have a reputation for high quality. Their reliability there is far higher than that of the cheaper competitors , like Fiat and the French makers, but not as good as Toyota and Honda even there.
One reason may be that many US VWS are not made in Germany, as the Passat V6 of a colleague, a wagon for his family of 5, which has 105k miles and no problems so far except the rear differential or sth which he fixed recently. When I expressed my surprise he explained it by saying “It’s made in Germany!”
October 16th, 2009 at 3:08 pm
If SAIC is interested in deepening its relation with GM, Why don’t they loan GM the money to buy back Opel in return for a stake in Opel?
That will open the European Market for their investment, and will not raise objections from Europe about Chinese tide gobling up everything.
October 16th, 2009 at 3:09 pm
I’m agreeing with Nick (about Csaba Csere, and I’ll include Patrick Bedard as well; also a recently vacated editor/columnist from C&D). With the loss of these two, Car and Driver will definitely have an uphill battle to regain credibility.
Also agreeing with Pedro (about the Chinese); not only the auto industry but a lot of their other products, which almost seemingly are made subpar on purpose. Giving them the benefit of the doubt; maybe just too eager to get product to the market to make that money
October 16th, 2009 at 3:16 pm
Nick: the old VW’s were, as you well know, bulletproof and simple machines. When they went away from air-cooled engines their quality suffered and they have been unable to attain the same status here that they once had, I owned both a Beetle and a Kharmann Ghia from the 70′s and they were awesome cars. I would not get into a new Beetle if they sold it to me for half price. Now a reliable Rabbit, that’s another story. Please don’t get me wrong, they’re excellent driving cars, just the reliability doesn’t seem to be quite as good as the Asians. Porsche doesn’t have that problem, however.
October 16th, 2009 at 3:25 pm
Goodness, everyone is a critic of the presenters. You guys must have no life. And Jim, must you argue about everything? (re: debating semantics with the head of the site to which you’re posting.) Can’t you just take your medicine and move on?
October 16th, 2009 at 3:58 pm
Nice show Kate L.
Eh- John, I think McElroy is on vacation and that’s a pre-recorded show.
Also, I love how imperialistic VW and Porscha are, it has this kind of WWII feeling to it. And Pedro… I think most VW’s sold in North America are made in Mexico.
October 16th, 2009 at 4:51 pm
Salvador: Just because they’re built in Mexico is no excuse for their so-so reliability, after all, a lot of reliable Asian cars are built here. Even Mercedes built in Germany are having reliability problems due in part to the complexity of all the electronics. I was told it costs $14k to replace the computer in an S class.
October 16th, 2009 at 5:27 pm
Kate,it was fun having you hang out here.
October 16th, 2009 at 6:27 pm
After watching Dr. Taub and all, I wonder how regenerative braking works on GM fuel cell vehicles. If they do not have it, they are throwing away energy every time the driver stops. Is there a battery for that or is a fuel cell reversible? Energy recovery from regenerative braking is one of the main benefits of both ICE/electric and ICE/hydraulic hybrid vehicles.
October 16th, 2009 at 6:40 pm
I think planned fuel cell cars are “hybrids” which have batteries to store energy from braking, and to make more short-duration power available than the fuel cell could provide.
October 16th, 2009 at 6:45 pm
Unemployment reality from the Bureau of Labor Statistics.
see:
Economy Won’t Recover in 2010
http://www.newmajority.com/economy-wont-recover-in-2010
F.Y.I.
October 16th, 2009 at 7:17 pm
For you GM Volt doubters out there: GM actually drove a caravan of 3 Volts from Michigan to Pa. just to prove they could actually drive in the real world. Wow, they actually can move! And they’re supposed to be out on the “real world” next year? good luck GM
October 16th, 2009 at 8:12 pm
I think the vOLT is a cool idea, but the cost is what will kill the car. After dealers mark them up, at least at 1st, 45 or 50 grand more, power to those who want to tell friends “look at me” and thats fine its a free country, as of now.
As for VW I had a 81 Jetta was a great car could not kill it, 87 GTI with a 16V, great fun car, and many friends with VWs and never really heard of any problems. The only this I ever here is that parts are costly?!@# what car is not. I will tell you that TDIs sure hold value, even high miles they pull big $$$$
October 16th, 2009 at 8:35 pm
I think the Volt looks real nice, maybe they should forget about all that electric crap and just put the body on a real drivetrain.
October 16th, 2009 at 8:42 pm
I think the Volt body would be nice with a diesel similar to VW’s TDI.
October 16th, 2009 at 9:40 pm
Fortune magazine has an online article dated 10-15 talking about how cloudy Volt’s future really is, and if it’s even worth building. A lot of unanswered questions at this late stage of development, supposedly it’s going to weigh nearly 4k lbs, that’s too heavy for an electric car.
October 16th, 2009 at 10:02 pm
Something I’d like to know about the Volt, is “if you start with a minimally charged battery, what gas mileage does it get?” That is what I’d want to know, even if it sold at Prius prices. I haven’t seen any such information.
To me, the technology is intriguing. Once the battery is run down, it works about like a diesel-electric locomotive, except that the engine is gas, and it is presumably charging the battery with “extra” power beyond what it takes to make the car go. I don’t have much of a feel for how efficient such a system would be. It has the advantage of having the gas engine running at, presumably peak efficiency, but you have the power loss of a motor, a generator, and the charge/discharge losses of the battery which is also involved under such conditions.
October 16th, 2009 at 10:07 pm
Pedro Fernandez Says:
October 16th, 2009 at 9:40 pm
“Fortune magazine has an online article dated 10-15 talking about how cloudy Volt’s future really is, and if it’s even worth building. A lot of unanswered questions at this late stage of development, supposedly it’s going to weigh nearly 4k lbs, that’s too heavy for an electric car.”
One bit of information indicating that the concept of a “series hybrid” may be viable, is that VW is working on something similar.
The 4000 pounds wouldn’t keep the concept of the Volt from working, but it would sure mean you’d need big batteries and motors to make it go adequately well.
October 17th, 2009 at 9:05 am
I think GM needs the volt to stay in the technology race. Their years behind Toyota and Honda, but they have plenty of company the europeans haven’t event scartched the surface of Hybrids.
My last VW was a Passat made in Germany it was junk.
October 17th, 2009 at 10:31 am
@Kit Gerhart,
Can you go into more depth with you question?
(Maybe compared to competing technology.)
Re:
“but you have the power loss of a motor, a generator, and the charge/discharge losses of the battery which is also involved under such conditions.” …
October 17th, 2009 at 10:48 am
“# M Campbell Says:
October 16th, 2009 at 3:25 pm
Goodness, everyone is a critic of the presenters. You guys must have no life. And Jim, must you argue about everything? (re: debating semantics with the head of the site to which you’re posting.) Can’t you just take your medicine and move on?”
If you have nothing of substance to offer to this AUTOMOTIVE Discussion than act as some kind of old lady schoolyard monitor-nanny whatever, then get lost. We already have a site editor for that.
October 17th, 2009 at 11:11 am
Kit: another detail about the Volt that i would like to know is: when the battery goes low,and the gas engine kicks in, at what rpm? is it going to vary according to power needs or is it going to be a steady speed. I can imagine drivers getting confused if the engine suddenly kicks in at a high rpm, the first reaction would be to slam on the brakes. It’s hard to eliminate years of using gas engines and reacting to the sounds they make.
October 17th, 2009 at 11:56 am
” dave Says:
October 16th, 2009 at 8:12 pm
I think the vOLT is a cool idea, but the cost is what will kill the car. After dealers mark them up, at least at 1st, 45 or 50 grand more, power to those who want to tell friends “look at me” and thats fine its a free country, as of now.”
Toyota absorbed many millions in losses before the Prius made a profit, but now it is the undisputed king of hybrids, and Ford is about to pass Honda in the distant second place..
IS the Volt equally promising? Will GM bite its teeth and take the losses for several years? Is light at the end of the tunnel if it does? ANd how long until a prius plug-in is on sale and shrinks the market share of the volt?
“As for VW I had a 81 Jetta was a great car could not kill it, 87 GTI with a 16V, great fun car, and many friends with VWs and never really heard of any problems. The only this I ever here is that parts are costly?!@# what car is not. I will tell you that TDIs sure hold value, even high miles they pull big $$$$”
PArts are costly for VWs, as for Hondas, VWs poerhaps even more costly. But recent VWs have both outstanding handling and great styling and were bought by many young people, until the reliability problems resurfaced.
But over in Europe, really, I never hear anybody complain about VW reliability, and those I know, when they go shopping, usually it is between a corolla and a VW Golf, with Honda a distant third in Europe, and Nissan not even considered.
As for used TDI prices, they are so high, that they dragged the average used VW price to the highest percentage retained value in the industry, even better than Honda or Toyota, some time ago, and VW was bragging about it.
October 17th, 2009 at 1:27 pm
Make sure you hear the latest AAH. I replayed it on Friday morning and really enjoyed the song from “Frankenstein jr”. I also learned something in the discussion. Remember the horses that went nuts whenever the name of “Frau Bluecher” was mentioned? I just thought the “Bluecher” was just a last name, identical to that of the old Prussian general who rendesvouz-ed with Wellington and beat Napoleon at Waterloo.
It turned out that “Bluecher” also means GLUE in German, and the horses were obviously panicked that they might be used to produce such glue!
October 17th, 2009 at 1:28 pm
I meant, the classic, side-splitting comedy movie “Young Frnakenstein”, in case anybody is confused with “Fr Jr” above.
October 17th, 2009 at 4:41 pm
…puttin’ on the ritz…
October 17th, 2009 at 5:14 pm
Pedro Fernandez Says:
October 17th, 2009 at 11:11 am
“Kit: another detail about the Volt that i would like to know is: when the battery goes low,and the gas engine kicks in, at what rpm? is it going to vary according to power needs or is it going to be a steady speed.”
From what I’ve read, I think the engine will run at a constant, fairly high speed, probably near the hp peak of the engine. They will need to isolate the engine sound from the cabin of the car really well, to avoid annoyance of and/or bad responses from the driver.
October 17th, 2009 at 5:29 pm
John should invite a GM rep to explain in detail exactly how this car is gonna operate, one thing I expect is that it will most likely launch later than announced,they still need to do hot weather testing so unless they go to Australia, they’ll have to wait till next summer to test it in the desert, and then make all the necessary adjustments.
October 17th, 2009 at 5:44 pm
Just read online on how the initial Volt test went and the chief engineer says the engine speed will fluctuate between 1200 and 4000 rpm’s And they are getting 300 miles per tankful (not impressed), also mentioned some road noise problems and vibration, but GM will solve those quickly, (like they’ve solved everything else). Now I’m pretty sure they won’t launch on time. (Nov 2010)
October 17th, 2009 at 9:43 pm
Pedro,
Thanks for the info. I suspect they well do a lot of experimenting on how to use the battery and motor/generator to best advantage. The 300 miles/tank doesn’t sound good at all, unless the tank holds only 5-6 gallons.
October 18th, 2009 at 7:47 am
GM has not released the data on the tank, it’s a “trade secret” but they better get higher mpg’s than that , otherwise that 230 mpg figure is gonna come back to bite them in the ass, it’s just amazing to me that at this stage of the game, a $40k car can have “noise and vibration issues but when you car much cheaper cars that have no such problems.
October 18th, 2009 at 11:11 am
I suspect they will need to do a really good job of isolating noise and vibration from the gas engine from the cabin. An engine doing things totally unrelated to what the driver does with the right pedal would take some getting used to, and I suspect the best solution is to keep you from hearing the engine at all, to the extent that is possible.
October 18th, 2009 at 12:12 pm
Kit and Pedro: If GM did the common sense thing and sold the Volt to City fleets and not to private owners,
then range and top speed would not be an issue at all, and it could make the volt just as big outside, but probably 1,000 Lbs lighter and even more fuel efficient!
ANd, most important, it would cost way, way less than the $40k or $32.5K (after they pick our pockets!)
October 20th, 2009 at 1:23 pm
I guess it takes all types to call the VW Beetle a “great car”. Slow, noisey, poor heating system and by modern standards, sort of thrifty. Simple, yes, reliable, yes if maintained vigilantly (but what car isn’t?). It was the anti-Detrot car favored by a lot of anti-establishment wanting to be hip Baby Boomers. The tendency of the front seats to break loose from their montings in a rear collision and give some nasty head wounds was a problem. But other than that a great car. Karmann Gia’s were secretary cars.
December 4th, 2009 at 12:01 pm
[...] we’ve reported, GM and its Chinese partner SAIC will form a new joint venture in India, but now we know some more details. According to Bloomberg, GM will transfer a portion of its stake [...]