March 27th, 2012 at 12:00pm
Mercedes-Benz is teasing its latest light-commercial vehicle, the Citan which is the first LCV to emerge from the Mercedes-Nissan-Renault alliance. Battery supplier A123 Systems admitted that its battery caused that embarrassing breakdown of the Fisker Karma when Consumer Reports was testing it. An executive from Japanese auto supplier Denso will serve a year in prison for his involvement in a price-fixing scheme. All that and more, plus an overview of Acura’s all-new sedan, the ILX.
Hello and welcome to Autoline Daily for March 27th. I’m John McElroy, and here’s the news.
MERCEDES-BENZ CITAN (subscription required)
Mercedes-Benz is teasing its latest light-commercial vehicle, the Citan, which is a combination of the words “city” and “titan.” WardsAuto reports it’s the first light-commercial vehicle to emerge from the Mercedes-Nissan-Renault alliance. Thanks to higher production volumes from the partnership, Mercedes can price this van much more competitively than the discontinued Vaneo. I think this LCV looks good and that bodes very well for the next-generation smart. Remember, Renault is supplying the platform for the next smart, and if they can make it at least as nice looking as the Citan, the car might just have a chance . . . but we’ll see.
EXPLORER GETS POWER BOOST
Ford’s redesigned Explorer offers buyers a choice of two different engines, a 3.5-liter V-6 as well as a 2.0-liter EcoBoost four-cylinder. But it looks like Ford believes it has to bolt-on more horsepower because it is working on a performance version. Nothing is official yet, but the company’s EcoBoost V-6 and all-wheel drive could cross over to the Explorer. More details are expected to be announced tomorrow.
STEEL MAKERS SWITCH TO NATURAL GAS (subscription required)
Very interesting development in the steel industry in the United States. Natural gas prices have dropped so much, thanks to hydraulic fracturing techniques, that steel producers are switching from coal to gas. The Wall Street Journal reports that natural gas costs almost $16 per million BTUs in Korea and Japan, but only $2.27 in the U.S. That could help North American automakers get cheaper steel. But how long will the cheap prices last? Natural gas prices have fallen so much that some companies have stopped drilling for it until prices start coming back up again.
GM LOBBIES FOR INCENTIVES IN CHINA
General Motors will start testing the Chevrolet Volt in China along with the China Automotive Technology and Research Center. Of course, the Volt is probably the most tested car in history, so why does GM need to even more testing in China? Ward’s reports that this test program will put the Volt in the hands of some of China’s top policy makers and opinion leaders, and I think that is a very telling clue. Right now the Volt does not qualify for China’s very lucrative consumer subsidies of $9,500 per electric car, as well as dropping a 9 percent sales tax. Unless GM convinces those top policy makers to change their minds, the American-made Volt doesn’t stand a chance in China.
A123 TO BLAME FOR FISKER BREAKDOWN
Speaking of electric cars, yesterday battery supplier A123 Systems admitted that its battery caused that embarrassing breakdown of the Fisker Karma when Consumer Reports was testing it. A123 will replace the batteries and the company says five other EV companies could be affected by the defect. A123 blames a faulty calibration in one of its welding machines that caused a misalignment of a component in some cells which can lead to an electrical short.
DENSO EXECUTIVE GOES TO PRISON
Earlier this year Japanese auto supplier Yazaki was hit with a $470 million fine by the U.S. government over a bid-rigging scheme involving wire harnesses. Several other suppliers that were involved were also hit with smaller fines. Now the Detroit News reports that Denso executive, Norihiro Imai will serve a year in prison and pay a $20,000 fine for his involvement in the conspiracy. Denso has already agreed to pay a $78 million fine for its part in the scheme. The Justice Department began its investigation several years ago and says the price-fixing boosted the cost of vehicles but it won’t say by how much. The scheme started about a decade ago and has led to investigations in Japan and Europe as well.
(Our overview of the Acura ILX is only available in the video version of today’s program.)
Hey, do you live in the New York area? If so, you can attend a LIVE broadcast of Autoline After Hours next Thursday, April 5th from Katz’s famous delicatessen in Manhattan. I’ll be there along with Peter De Lorenzo, the Autoextremist, and you can find out all the details on our website. Just visit the Autoline After Hours section of Autoline.tv where you can RSVP and get directions to Katz’s Deli. Give us a shout so we can know how many people to expect.
And that wraps up today’s report, thanks for watching, we’ll see you tomorrow.