January 7th, 2013 at 10:55am
Since 2006 the bus industry in the U.S. has grown between 5 and 10 percent a year, which could be why one Chinese automaker will open an electric bus factory in California. Some car dealer associations are suing Tesla because it’s selling cars in its own stores instead of going through the existing franchised dealer network. PSA, the parent company of Peugeot and Citroen, desperately needs cash and may sell its stake in parts maker Faurecia. All that and more, plus a look into the all-new 2013 Toyota RAV4.
Welcome back as we kickstart a brand new work week. There’s already a lot going on today in the global automotive industry. Here’s the latest news.
BUS TRAVEL BOOMING
Even though the United States has the highest density of cars per people in the world, more and more Americans are taking the bus. A new study from DePaul University says it’s the fastest growing form of intercity travel in the U.S. Last year scheduled departures were up 7.5 percent and since 2006 the industry has grown between 5 and 10 percent a year. Some of the advantages are that it’s cheaper than taking a train or plane and you don’t have to deal with security lines.
BYD TO BUILD IN CALIFORNIA
And this could be why Chinese automaker BYD will open an electric bus factory in California. According to Gasgoo, the company will produce 50 to 100 electric buses at the yet-to-be-named site by 2014 and boost that to 500 the following year.
FIGHTING TRAFFIC CONGESTION
And speaking of China and buses, in an effort to reduce traffic congestion, the government announced that it wants public transportation to account for 60 percent of vehicle use in urban areas. It did not say what the current number is or offer a timeframe for reaching the goal. At the end of 2011 there were over 62 million private cars on the road in China, by 2020 it’s estimated that number could be over 200 million.
TESLA FIGHTS THE FRANCHISE SYSTEM
Many car dealer associations are furious that Tesla is selling cars in its own stores instead of going through the existing franchised dealer network. And so they’re suing the electric car start-up. But Tesla just won a major victory in Massachusetts where a lawsuit against the company was thrown out. The Massachusetts Car Dealer Association says its going to appeal, but here’s my Autoline Insight. State franchise laws prevent automakers from opening their own company stores and going into competition with their own dealers. But if a car company, like Tesla, is a start-up and never had any other stores, then I believe the courts will allow it to introduce its own retail network. In a way, what Tesla is doing is very similar to Apple opening its own retail outlets. Nonetheless, Tesla is going to face an awful lot of lawsuits over this. It wouldn’t surprise me if it has to fight its way through all 50 of the states in the United States of America.
FAURECIA FOR SALE?
Recently we showed you a new type of seat developed by Faurecia that is lighter and more comfortable and could show up later in the decade. Now we’re getting word via Bloomberg that Faurecia may be up for sale. You see, Faurecia is owned by PSA, the parent company of Peugeot and Citroen, and PSA desperately needs cash. Faurecia does over $20 billion in sales every year and posts an operating profit of around $750 million. That would suggest to me that PSA could raise about $5 billion by selling Faurecia.
JUST SMOKE, NO MIRRORS
A new world record for the largest simultaneous burnouts was set down under at Australia’s Summernats Car Festival. The previous Guinness Book record was raised from 49 cars to 69. The record breaking attempt saw 30 of those participants blowing out tires in the 30 seconds needed to set the record.
(RAV4 can only be viewed in the video version of today’s show.)
Toyota really needs to get sales going with the new RAV-4. Last year the Honda CR-V topped the list in the segment, followed by the Ford Escape and Chevrolet Equinox. The RAV is in fourth place and quite a ways behind the other three.
And that wraps up today’s report. Thanks for watching, and we’ll see you right back here again tomorrow.