October 18th, 2010 at 12:09pm
Employees at GM’s plant that makes batteries for the Chevrolet Volt decided to join the United Auto Workers union. The CUV segment is the most popular in the American market for the second-consecutive year. Ralph Nader questions R&D spending claims Toyota made in some of its advertisements. All that and more, plus a look at the design of the 2011 Kia Optima.
This is Autoline Daily for October 18, 2010. And now, the news.
VOLT BATTERY WORKERS JOIN UAW
In a development that will be watched closely by labor experts, employees at GM’s plant that makes batteries for the Chevrolet Volt decided to join the United Auto Workers union, but they did this with a very controversial card check, not by an election monitored by the National Labor Relations Board. In the United States unions have been pushing legislation to allow card checks instead of elections that use voting booths where workers can vote in private. They just want workers to sign a card instead. Despite strong support amongst Democrats, including President Obama, this legislation has never been brought to a vote, because Democrats are afraid to bring it to a vote, because it would almost certainly fail. The DetroitBureau.com reports that General Motors agreed to card checks in its last labor contract. Besides, there was no way GM could protest this, after all, the UAW is the second-largest shareholder in the corporation, after the federal government.
UAW PROTESTS WORRY INVESTORS
Now, the AFP reports that problems with the UAW are starting to make investors nervous about buying stock in General Motors when the company goes public. This includes nervousness of workers protesting the need for lower wages to make small cars profitably in the United States. It quotes one analyst as saying GM has a long history of destroying shareholder value and that the hourly workers don’t seem to be aware of the need to be competitive. I would point out that this is not what GM needs as it prepares to start selling stock again, probably within a month.
CHINA’S OVERCAPACITY CONCERNS
Last week we reported that even though car sales are up in China, they are starting to slow down. Now the AFP reports that China’s National Development and Reform Commission is concerned about overcapacity. By 2015 China’s 30 largest manufacturers are projected to have production capacity of 31 million units which is double the current number. Automakers say that sales will hit 30 million by then, but the NRDC doesn’t think that will happen.
CUVs #1 IN U.S. (subscription required)
The CUV segment, which is short for cross-utility vehicle, is the most popular segment in the American market. According to Ward’s, nearly a quarter of all vehicles sold during the 2010 model year, which runs from October to September, were a CUV, totaling 2.7 million units. It’s the second consecutive year CUVs were the top seller. Coming in second place were midsize cars and rounding out the top three were small cars.
MITSUBISHI CONSOLIDATES U.S. LINE-UP (subscription required)
It’s no secret that Mitsubishi is up against the ropes. The automaker’s U.S. sales have declined 3.4 percent so far this year compared to 2009, though its market share has stayed the same at a whopping HALF a percent. In response to its tepid sales, Ward’s reports that the company plans to trim its product lineup down to just the Lancer and Outlander, both of which are imported from Japan. To me this suggests that Mitsubishi will be closing its only North-American factory, located in Normal, Illinois, where it builds the Eclipse, the Galant and the Endeavor.
TOYOTA R&D SPENDING QUESTIONED
Ralph Nader has another automaker in his sights. This time Toyota has a bull’s eye on its back. USA Today reports that the tireless safety advocate sent a letter to Jim Lentz, the company’s U.S. sales chief, questioning some of its advertisements where it claims to be spending a million dollars an hour on research and development. Nader did the math – and so did we. At 24 hours a day, 365 day a year that works out to nearly $8.8 billion. But Autoline Daily discovered that’s the R&D number from two years ago. Today, Toyota is spending $1 billion less on R&D, about $7.8 billion a year.
The Hyundai Sonata is selling like crazy. And now Kia, the sister company to Hyundai, is getting its version of the car. We’ll show you what it’s about, right after this.
2011 KIA OPTIMA
The new Kia Optima sure doesn’t look like the old Kia Optima. We asked Ralph Tjoa from Kia to take us through the car and show us what it’s all about.
The Kia Optima is yet another example of the design work of Peter Schreyer, the new head of design at Kia who was hired away from Audi. Pretty good looking car.
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And that’s today’s report on the top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.