December 15th, 2009 at 12:00pm
Toyota could be forced to sell-off Daihatsu, its subsidiary that makes small cars, and Hino, its subsidiary that makes medium and heavy trucks. Audi’s president of North America, Johan de Nysschen, criticized the U.S. Government for “falling in love” with electric vehicles. Sergio Marchionne explains why the Fiat 500 will be sold as a Fiat and not a Chrysler in the U.S.
Transcript and Story Links after the jump . . .
Here are today’s top headlines. Japan considers rules that could start to break up Toyota’s keiretsu system. Audi says the hype over electric cars is way overblown. And Sergio Marchionne explains why the 500 can only be sold as a Fiat.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Tuesday, December 15, 2009. And now, the news.
Japan’s new government is looking at making big changes. To protect minority shareholders, Bloomberg reports that a member of Japan’s Democratic Party is proposing to force big corporations to sell off or buy up all the shares in subsidiaries they hold. That means Toyota could be forced to sell off Daihatsu, its subsidiary that makes small cars, and Hino, its subsidiary that makes medium and heavy trucks. Or, it could be forced to buy them up. In Japan, the stock of the subsidiaries companies consistently underperform the stock of their parents, and Japan’s Democratic Party says the system is unfair to shareholders in those subsidiaries. This could also starts to affect Japan’s keiretsu system, where automakers own stock in their suppliers.
In a sign that they truly are starting to recover, Ford and General Motors will lift pay freezes for employees. Bloomberg reports that Ford will restore merit raises and will match 401(k) contributions up to 5 percent of base pay. GM already restored matches of 4 percent and will start merit raises in February. The automakers had imposed those freezes and cuts to preserve cash, and this is a sure indication that their cash crisis is over.
Speaking to the press yesterday, Audi’s president of North America, Johan de Nysschen, criticized the U.S. Government for “falling in love” with electric vehicles. According to the Detroit News, de Nysschen believes that the high cost of EVs won’t be offset by savings from reduced fuel consumption and the only way to do so is with government subsidies, which he doesn’t believe is sustainable. He favors diesel technology and says let the market pick the winners and losers, not government.
Audi is installing almost 12,000 square meters of solar panels on top of some of its buildings in Ingolstadt, Germany. The photovoltaic cells will generate more than 1,000 megawatts of electricity per year, which is enough to power around 220 four-person households.
In other Audi news, the company is gearing up to reveal the production version of its subcompact A1 at the Geneva Motor Show next year. To generate buzz, it’s released a few teaser videos. One of them features a street artist painting a mural of the car on a wall with spray paint. We’ll have to wait to see how closely this matches the real thing.
Most automakers that were in the heavy-truck business got out of that business, but now the pendulum is swinging back the other way. Chrysler will be getting back into large trucks thanks to its partnership with Fiat. And now, according to Reuters, Volkswagen is looking to take full control of German truckmaker MAN. VW already has close to a 30 percent stake in the company and would like to combine it with Swedish truckmaker Scania, which VW owns a 70 percent voting stake in. An interesting part of this story, VW Chairman Ferdinand Piech, is also, conveniently, the Chairman of MAN.
Speaking of auto shows, NAIAS is just around the corner. Manufacturers are gearing up to build excitement for their reveals. The other day we reported that Toyota will have some big announcements about alternative-fuel vehicles. To whet our appetite, the company released two teaser shots of a new, dedicated hybrid. It’s hard to tell, but it sure looks like the iQ. Mercedes also spilled the beans on its new E-Class Cabriolet. Like the drop-top Audi A5, Daimler’s new convertible features a cloth roof, which is lighter and simpler than retractable hard tops. It should go on sale next May.
Coming up next, Sergio Marchionne explains why the Fiat 500 will be sold as a Fiat and why it could never be sold as anything else.
When Fiat announced that it would have Chrysler sell the 500 in the American market, there was a lot of speculation as to whether it would be sold as a Chrysler 500, or maybe just as a 500, with no other brand name on it. The thinking was that the Fiat name was poison in the American market, and besides, how could you sell a Fiat in a Chrysler dealership? But Sergio Marchionne, who now runs both Fiat and Chrysler, is known to have a laser-like focus on brands. And in the following clip, he explains why the 500 can only be sold under the Fiat brand.
If Marchionne can really get Chrysler to market the emotion of buying a car, and not just try to offer the best price on a commodity, then Chrysler’s future will look bright.
And that is it for today’s top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.