Episode 373 – Toyota Saga Continues, Delphi Back In Black, Hyundai’s New Designer

April 19th, 2010 at 12:00pm

Runtime 7:47

Yet another chapter in the saga at Toyota. Delphi is profitable once again in North America. BMW is offering chauffeured tours of Munich, Germany in classic convertibles. All that and more, plus an interview with the latest guy that Hyundai stole away from General Motors to design its cars.

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Transcript and Story Links after the jump . . .

Here are today’s top headlines. Yet another chapter in the saga at Toyota. Delphi is profitable in North America. And an interview with the newest designer at Hyundai.

Up next, we’ll be back with the news behind the headlines.

This is Autoline Daily for Monday, April 19, 2010. And now, the news.

TOYOTA SAGA CONTINUES
More problems for Toyota. It’s agreeing not to contest the record fine that NHTSA slapped on it. It faces yet another hearing in the U.S. House of Representatives next month about unintended acceleration, this time by Henry Waxman. And it got hit by yet another recall. The company says the cable that holds on the spare tire on the Sienna minivan could rust and the spare could fall off, creating a major road hazard.

PRIUS MINIVAN
And finally some Toyota news that’s not negative. Bloomberg reports that Toyota is going to come out with a hybrid minivan based on the Prius. It will have three rows of seats, use lithium-ion batteries and will be out next year. It will be the first of a family of new models that will be sold under the Prius name.

DELPHI BACK IN BLACK
And here is an eye-popping headline for everyone who follows the supplier industry. Delphi is profitable once again in North America (subscription required). Ward’s reports that after four years in bankruptcy, Delphi is back in the black and ready to grow again. It quotes Delphi’s chairman Rodney O’Neill as saying the company managed to snare $89 billion in new business over the coming years. He expects sales to grow from $11 billion this year to over $15 billion in the next two years. And says Delphi will invest 11 percent of its revenues in R&D, which is an extremely high percentage rate.

CHINA MANDATES MORE DOMESTICS
Earlier this month we reported that Geely was looking to position Volvo as China’s brand of choice for its government officials, and it looks like that could happen thanks to a new mandate. According to Gasgoo, the Chinese government is expected to mandate that more than 50 percent of government fleet purchases be from domestic brands. And the new guidelines will also exclude most vehicles made by joint ventures. China is expected to pay 100 billion yuan or about $14.5 billion on vehicles this year. Currently Audi is the brand of choice among China’s government officials.

CHINA TO SUSTAIN GROWTH
And speaking of China, car sales keep going up there and it’s expected to stay that way for the next several years. According to Gasgoo, analysts predict that sales will grow 20 percent per year for the next five years in the country. One reason is that the average income in the country continues to rise which should help car sales grow as well.

BMW OFFERS TOURS OF MUNICH
Giving visitors a unique view of the city Autoblog reports that BMW is offering chauffeured tours of Munich in classic convertibles. The drop-tops are part of the company’s private collection and include 326 and 335 cabrios from the 1930s, a 502 “Baroque Angel” from the ‘50s and more. The tour hits all of the big BMW attractions in Munich including its Museum and corporate headquarters, plus tourists are treated to a drive on the ring road surrounding the old city center. The three-hour trip costs 90 Euros, or about $120 and runs from April to October.

TRANSPLANTS WANT TO ORGANIZE?
“Transplants,” or foreign automakers that set up factories in the U.S. have basically avoided the UAW, but that may change going forward. According to Ward’s, Ron Gettelfinger, President of the labor group, says he’s confident the union will start organizing workers at European- and Asian-owned plants (subscription required). He says they’re getting a lot of phone calls from people about various issues, but he declined to comment as to what their concerns are. He says interest in the UAW is growing – mostly in plants located in southern states.

Coming up next, we’ll take a look at the latest guy that Hyundai stole away from General Motors to design its cars.

As we’ve reported right here on Daily over the last few months, Hyundai has really been making great strides with both products and sales despite losing some key decision-makers recently, like its North American design chief.

The man now in charge of keeping those next-generation designs flowing – at least from its Orange country studio – is Phil Zak . . . a General-Motors vet who designed the very hot-selling Chevy Equinox . . . and who hopes the look of all-new Sonata will continue taking Hyundai sales to new heights

One of the ways Hyundai is targeting that new universe of buyers is with something called Fluidic Design. That’s its new international design language that gives the vehicles – among other things – a richer, more affluent look.

Fluidic Design also speaks to the aerodynamic flow of the car. You can see that with the strong lines that start from the grille, creating – what Hyundai says is – an object in motion despite the fact the car may be standing still. It debuted on the 2010 Tucson Crossover followed closely by Sonata with others in the queue.

And we’ll see just where the brand continues to go and grow with new vehicles like the Elantra due out later this year as well as the Sante Fe crossover that’s not too far behind.

Don’t forget to join us Thursday night for Autoline After Hours when our guest will be Doug Fehan, the head of Corvette racing. That’s Thursday night live at 7:00 p.m. Eastern.

And that’s it for today’s top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.

Thanks to our Partners for embedding Autoline Daily on their websites: Autoblog, The Auto Channel, Car Chat, WardsAuto.com and WWJ Newsradio 950

30 Comments to “Episode 373 – Toyota Saga Continues, Delphi Back In Black, Hyundai’s New Designer”

  1. Gary Taylor Says:

    I want to wait till they start the tour of Munich
    in the BMW R75 sidecar complete with MG 42!

  2. Tom Martin Says:

    If the Elantra is a good as the Sonata, Hyundai sales will skyrocket.

    I suspect that Ford will do well with the Fiesta and the upgraded Focus.

    I wonder who will take the biggest “hit” in sales in 2011. Someone will need to lose sales.

  3. pedro fernandez Says:

    Yeah, great news, Ron Middlefinger and his cronies are gonna make the transplants transplant their asses down to Mexico to avoid the same problems the UAW brought to the domestics. Are we getting second hand news now, we read about the Prius mini-minivan on this forum last week.

  4. Nick Stevens Says:

    The BMW 3 hour tour for 80 euros is a good value, where else would one have such an opportunity to actually ride these beautiful classics, and for three whole hours at that.

    I was not impressed with the Hyundai Design guy, even tho he claims credit for the excellent new Equinox. After he started speaking and touting various silly add-ons, he sounded more and more like the late Ricardo Montalban pitching those excremental Chryslers with “Corinthian leather”. In fact, if that leather was any good, it was a far more important point than chrome door locks and other assorted useless BS.

    The styling of most new hyundais is unnecessarily busy for my taste. And the Sonata may sell well for a while, but John M. test-drove it, and the 4 cylinfer, regardless of its claimed HP, is noisy as hell when you really want to go fast. And that’s not a pleasant noise, like a Ferrari makes… LOL.

  5. Nick Stevens Says:

    “# Tom Martin Says:
    April 19th, 2010 at 12:35 pm

    If the Elantra is a good as the Sonata, Hyundai sales will skyrocket.”

    They won’t, but they will hold their own.

    “I suspect that Ford will do well with the Fiesta and the upgraded Focus.”

    it should do extremely well, as will GM with the 40 MPG focus-sized CRUZE, whose 40 MPG version will be only hundreds of $, not thousands, over the base model.

    “I wonder who will take the biggest “hit” in sales in 2011. Someone will need to lose sales.”

    Sales now are still very low, so they could easily go up in 2011. Assuming we do not have a double-dip W-shaped recession.

  6. Chuck Grenci Says:

    Well shut my mouth, I totally agree with Nick today; well said.

    Hyundai ‘is’ on the move but I don’t like the ‘hypeing’ until results are in. And I’m still not impressed by what I’m seeing at Hyundai yet.

  7. Nick Stevens Says:

    Today’s happy Hondans

    “Fourth Rollover”
    by Brian R
    Hamersville, OH
    Mileage: 400,002 miles
    Click on a thumbnail for full-size image.
    She’s still chuggin’ along. Still averaging 46 mpg. Just rolled over “The Big 4″ this morning.

    and two more with over 300,000 and close to 400,000 miles in the usual site:

    http://automobiles.honda.com/mile-makers/owner-stories.aspx

    Anybody has found the MERCEDES high-mileage site that Honda copied?

  8. John V. Says:

    If Delphi can really put 10% of its revenues back into R&D they could become a components and subsystems powerhouse. I doubt the stockholders and board of directors would tolerate that for long. Another concern is what O’Neill means by “revenues.” Is that before salaries and bonuses are subtracted?

  9. Nick Stevens Says:

    http://www.thetruthaboutcars.com/car-execs-predict-41m-cars-per-year-in-china-2015/

    While we went from 17 million to 10 million new cars in the US, China has already surpassed us by 3.5 million in 2009, and may break our all time record in 2010,

    but this is nothing co mpared to car execs predictions for an un-EFFING-believable

    41,000,000 new cars PER YEAR in China by 2015!

  10. HyundaiSmoke Says:

    Hyundai=the new Heineken. A lost cost premium beer that’s not for everybody but there are sure a lot of takers.

    That Elantra will be sweet, but its going to be too radical for a few people which is quite ok. Those people will be just go to Cruze/Astra or Focus/Tracer. Id rather have a radical Elantra around than for Hyundai to play its safe, and build a snore. Next Gen Elantra will be one of the most radically (in a good way) styled product in that class by far.

    It will be Mazda 3 Polarizing almost.

    I have a feeling the Santa Fe will do for Soccer Mom Utes what Sonata did for Midsized Sedans. Until this Generation Sonata, Santa Fe was Hyundai’s main American Volume Leader. I dont get how, as Santa Fe by far is Hyundai’s worst styled product and it has never compelled me to even entertain a purchase like the Tucson.

    We may agree to disagree, but the Santa Fe Looks Horrible right now like Last gen 2000-2005 Accent. I hope they go bonkers (in a good way) with that truck on the styling front.

  11. HyundaiSmoke Says:

    That Elantra is going to a conversational piece for a lot of people. On blogs, showing up with one to work, etc…

    For its class it will be the, “WOW LOOK AT THAT CAR” Car. Its the Antithesis of what Americans are used to from C-Segment styling.

    By the way, nice interview John.

  12. pedro fernandez Says:

    If China continues at this rate, they will be just crawling around at 5 mph because the road construction cannot possibly keep up with the growth in market share.

  13. Kit Gerhart Says:

    HyundaiSmoke Says:
    April 19th, 2010 at 3:54 pm

    “Hyundai=the new Heineken.”

    Does that mean Hyundai is going to raise their prices dramatically? Heineken is OK, but nothing special, but it is expensive, at least in the US. In some European countries where it is the Euro Budweiser, it is not too expensive compared to other beers.

  14. Kit Gerhart Says:

    If 41M cars a year are sold in China by 2015, they had better be very fuel efficient or driven very few miles, or the world will see $300/barrel oil a lot sooner than we thought. That many additional cars, and they would be additional, not replacement, would change the supply/demand equation dramatically over a very short time.

  15. Todd Jaspers Says:

    John, you should have two AutoLine Dailys… Toyota seems to be issuing their recalls half-way through the day so it doesn’t hit the mainstream media!

    They just issued a recall for all LX-460 SUVs.

  16. HyundaiSmoke Says:

    LMAO Kit, not yet. I dont know Heineken is relatively cheap here where I live. Its not Bud, but its not an expensive speciality beer either.

    The Hyundais though I think will stay reasonably priced all the way to the mid 2020s. The days of finding criminally good steals (i.e. resale value) on a Hyundai will be drawing to a close soon though.

  17. MOHAMMAD RAFI Says:

    I’m sick and tired of all the Hyundai bashing. Why can’t we just accept the fact that the Sonata is one of the best looking sedans ever made? It not only looks great, but it also just won a Car & Driver comparo against the likes of the Honda Accord and Subaru Legacy. If you take a minute to see the Sonata for what it really is, you’ll see that it’s a very well-priced car with tons of standard features and very good driving dynamics. And did I mention that it looks better than nearly every other sedan on the road?

  18. Mark Y Says:

    John,

    Hyundai rhimes with Sunday. At least that is the way they introduced themselves when they come to the US market.

  19. Alex Kovnat Says:

    I am not enthusiastic about the UAW organizing transplant factories in southern states, and here is why:

    I’ve heard stories about how transplant factories pay workers as much as they would receive if they were unionized. So why do these facilities prefer the UAW stay out? Because they don’t want to put up with UAW work rules. Years ago I heard a joke, perhaps apochryphal, about how a newly hired engineer at one of the Big 3 was asked to design a sub-assembly that had both wood and metal.

    The purpose was to teach the neophyte engineer the hard way that if you have an assembly with both wood and metal, UAW metalworkers won’t touch it because it has wood — and only those who hold a union card as woodworkers are allowed to mess with anything involving wood.

    On the other hand the woodworkers won’t work with this assembly either, because it also has metal and only those who hold a union card as a metalworker, are allowed to mess with anything that has metal in it.

    Its this kind of neurosis, as much as pay and benefit issues, that makes transplant facilities want to avoid the UAW.

  20. Mike W Says:

    You said Delphi is going to come out of bankruptcy after 4 long years and make money. What happens if they don’t make money, like so many times before? Are they going to go crying back to GM to bail them out? Whoever wrote that GM/Delphi agreement that ties GM to Delphi no matter what, should have their law license revoked. It made GM look like they lost what little business sense they ever did have and it gave Delphi a way out every time they needed one.

  21. Mike W Says:

    If China buys 41 million cars a year, why doesn’t GM just move to China and import cars back to the US? They would cut labor costs, they could have engineering done over there, and people in the US might even buy more GM cars – because, hey, then GM would be an import brand in the US, not a stinking domestic!

  22. dcars Says:

    It’s one thing to say your going to organize the non union southern state factories; it’s another thing to actually do it. If they want to keep their jobs they won’t organize. Look at NUMI in California, as soon as GM pulled out their was no way Toyota would keep that factory open.

  23. Kit Gerhart Says:

    UAW work rules have become a lot less ridiculous over the years, but there are still some “lines of demarcation” which complicate things.

    If the transplants want to avoid UAW organizing their facilities, the best thing they can do is provide pay and benefits equal to the UAW plants, and provide “job security” guarantees that the UAW has contracted, (but has also gotten the “Detroit three” in major financial trouble.

  24. dcars Says:

    Just my thoughts but GM and Ford are the UAW’s best bet to add members. they should try working with them to make them profitable. I know, I know, I’m in fantasy land. My Dad was a Unionized Tool and Die maker. GM just invested $450 Mil. into a factory in western New York.

  25. HyundaiSmoke Says:

    You have a point Mark. I just think Hun day and Hun-die are both fine.

    Hun-day is what they have to do to get Americans to pronounce it half decently.

    Hun-Die sound more exotic, and considering Hyundai’s “upmarketing” of its brand its time for them to come up with a more exotic pronounciation, yet Americans will be able to pronounce.

    Im not saying for them to do it, but they should just entertain the idea of putting Hyundai in Cursive on the back of the cars instead of the bold HYUNDAI.

    At least do a market study on it, and see it is viable.

  26. HyundaiSmoke Says:

    Some of the new Commercials are now pronouncing it as HAHN-DIE, which I like too.

  27. HyundaiSmoke Says:

    Hey Kit check this out of this wild ass MINI if you havent seen it yet. Its classic, yet very polarizing, but the kind of foward thinking tech needed in small cars. I love it!!!

    http://www.youtube.com/watch?v=qmX6Ns-we3M&feature=player_embedded

  28. Nick Stevens Says:

    “# Kit Gerhart Says:
    April 19th, 2010 at 4:05 pm

    If 41M cars a year are sold in China by 2015, they had better be very fuel efficient or driven very few miles, or the world will see $300/barrel oil a lot sooner than we thought. ”

    The way the $ is going to hell the last 50 years and especially lately, $300 will not amount to much if it happens 5 years fron now. BUT the main point is that oil markets are self-correcting, we NEED the high price to convince people to drive less, use less oil and thus bring its price down.

    ALSO, there are, despite all the BS by the peak oil charlatans, tremendous oil reserves and major investment to develop them, any shortages will not last more than a couple years until the new supply comes in.

  29. Watt D Fjark Says:

    If you haven’t read “Crash Course” by Paul Ingrassia of the WSJ, I recommend it. It’s short, so in some cases it doesn’t do its subject justice. But he does include some ridiculous descriptions of the management vs. labor issues with plenty of blame to go around.

  30. Kylie Batt Says:

    Вы попали в самую точку. В этом что-то есть и это хорошая идея. Готов Вас поддержать….

    Runtime 7:47

    Yet another chapter in the saga at Toyota. Delphi is profitable once again in North America…..