Episode 172 – Hummer Sale Hits a Snag, Ford Slashes Suppliers, Production Plummets in Japan

June 25th, 2009 at 12:00pm

Runtime 6:18

Conflicting reports coming out of China regarding the deal to buy Hummer. Ford is accelerating plans to reduce the number of suppliers it works with. Automotive production plummeted last month in Japan as automakers were hammered by the global recession. All that and more, plus a look at the new Renault Scenic.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. Hummer’s sale may have hit a snag. Ford slashes suppliers, and production in Japan plummets.

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

This is Autoline Daily for Thursday, June 25, 2009. And now, the news.

Conflicting reports coming out of China regarding the deal to buy Hummer. Reuters says the top National Development and Reform commission will reject the bid of Sichuan Tengzhong to buy Hummer. It says the construction machinery company has no expertise to run a car company. However, China’s Ministry of Commerce says the deal will go through. And other reports say it will be a done deal before this month is over.

Production numbers in Japan just came out and the AP reports that automotive production plummeted last month as Japanese automakers were hammered by the global recession. Yesterday, Toyota announced its production was down 39 percent, the 10th straight month of decline. Honda was down 38 percent, Nissan was down 27 percent, Mazda 37 percent and Mitsubishi was off by nearly 55 percent.

Ford is accelerating plans to reduce the number of suppliers it works with. According to Reuters, the company will identify around 850 suppliers it wants to do business with by the end of the year, down from about 1,700 last year. Ford says that there is too much capacity and it wants to work with a smaller number of healthier suppliers. In the long term, Ford plans to reduce its number of suppliers to 750 companies.

GM will build the Chevy Volt in China. According to AutoBeat Asia, the company will start building the Volt there in 2011 and will only sell them in China. The Volt begins production at GM’s Hamtramck plant next year and GM will expand production around the globe once the Hamtramck plant can’t keep up with demand.

This fall BMW is launching a pair of diesel 7 Series models. The 740d features a newly developed twin-turbo straight-six engine. It delivers 306 horsepower and a tractor trailer-like 442 lb-ft of torque. Icing on the cake is that its average fuel consumption should be right around 6.9 l/100 km, or roughly 34 miles per gallon! A less powerful, but cleaner and even more efficient 730d will also be offered. Beyond the new engines, the company is also offering an “M Sports Package” on its flagship for the 2010 model year. No word if or when these monster oil burners will ever make it the American market.

Ward’s reports that the EU approved new tire and vehicle safety regulations (subscription required) that will go into effect over the next decade. Some of the details include: Beginning November of next year, all new vehicles must be equipped with a tire-pressure monitoring system. By November of 2012, new vehicles must meet tire rolling resistance and wet-traction standards. By 2013 many commercial vehicles must feature emergency braking and lane departure warning systems and by 2014 new vehicles are required to have stability control.

Coming up next, a look at the new Renault Scenic. Back in 15 seconds.

Just as in America, European automakers like Renault have been struggling with slow sales and government loans. But the company hopes to start the rebound with the release of the third generation of a former European Car of the Year.

The Scenic, introduced in 1996 as the first multi-purpose vehicle or MPV in Europe, has been a hit selling over three million units since.

The newest version is larger and longer and handles like a sedan thanks to the same suspension and power steering setup as Renault’s small family car the Megane. In fact, some of the front end styling came from the Coupe version of the Megane as well.

But there’s a lot that’s all Scenic as well. Take the interior, which seats up to five adults but still offers a lot of room when you fold or remove the seats.

Meanwhile under the hood, Renault is offering 14 different powertrain options on the vehicle; most are gas and diesel but there’s also an E85 version as well as one that runs on liquefied petroleum gas. With so many choices, fuel economy is all over the map, however, the most effective gas engine clocks in at 7.1 l/100 km or 33 miles per gallon combined, while its diesel equivalent is obviously more efficient at 4.9 l/100 km or 48 MPGs combined.

Of course with so many choices pricing for the Renault Scenic has a number of options as you might expect…but a base MPV starts out about 16-and-a-half thousand Euro or around $23,000 and can top out at just over 27-thousand Euro or $38,000.  The Scenic goes on sale in Europe later this month.

Don’t forget to tune in tonight to Autoline After Hours. Joining me and Peter De Lorenzo and Jason Vines will be Denise McCluggage, a real pioneer who’s been a race car driver, a columnist and journalist who is one of the most interesting people I’ve ever met. She is also on a diesel crusade, so anyone interested in diesels will want to hear what she has to say. That’s tonight at 7 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.

14 Comments to “Episode 172 – Hummer Sale Hits a Snag, Ford Slashes Suppliers, Production Plummets in Japan”

  1. Episode 172 - Hummer Sale Hits a Snag, Ford Slashes Suppliers … | news ohsiam Says:

    [...] Read the original here: Episode 172 – Hummer Sale Hits a Snag, Ford Slashes Suppliers … [...]

  2. Alex Kajdi Says:

    John,

    You mean to say that the Volt will be available for sale in China before it’s available in the USA? The Federal Government just gave Billions to GM for EV / Battery Technology Development and the Chinese will profit from it first with the Volts being build and sold in China first?

    If that is what GM is planning to do, then Congress should ask GM to give the money back immediately. Where is the over-sight committee? They must have all gone on summer vacation. Americans are mad already about the Financial / Banking System Bailouts. The Auto Industry Bailout is really taking the US Tax Payer for a ride!

  3. Episode 172 – Hummer Sale Hits a Snag, Ford Slashes Suppliers, Production Plummets in Japan Says:

    [...] Original post by John’s Journal [...]

  4. Len Simpson Says:

    The world of Cars is all fubbed up! Ordered a Camaro last october,arrives next week. Overbilled & GM card credit halved. Too big,too heavy & claustrophic. Hope I can get my deposit back.

  5. paulstewart Says:

    Where’s Thor ?

  6. Max Christensen Says:

    Alex,

    Don’t blow a gasket! Go back and follow the link to the article ……. GM is going to build the Volt here in the United States beginning next year. The Chinese Volts will be in addition to the US Volts and will only be sold in China. GM is anticipating high demand worldwide for the Volt, and the Chinese version will ease the load from the US plants.

  7. Episode 172 - Hummer Sale Hits a Snag, Ford Slashes Suppliers … Says:

    [...] the whole story here: John McElroy aggregated by [...]

  8. John Voros Says:

    It is a winning strategy to sell and build in the same markets.Good for GM if they can grab more market share in China with the volt.

  9. G.A.Branigan Says:

    GM is going to end up shooting itself in the foot.I really don’t believe that the much hyped Volt will sell worth a damn here.I’m not sure how many people living in the northern states would buy it at all giving the winters etc.

    I’m looking forward to tonights show.watch out John,ya got a DIESEL lady coming in.She already won my heart ;}> BMW with hypo diesels too,my how the world is a changing…..in my oil burnin’ favor.See ya’ll tonight…

  10. Salvador G. Says:

    About the Volt… The US goverment is in great amount of debt to China, so I really don’t think anyone will oppose the sell off of Hummer to the good communist oppresive goverment.

    Also, John McElroy, Do you think its possible that the new Renault Scenic could be sold here in the US as a Nissan???

  11. Dan Clemons Says:

    Hi John:

    I see that Bridgestone is one of your major sponsors. I just want you to know that I love my Bridgestone Potenza’s. Without a doubt, the best tire I have ever had on my Mercedes SLK. Walmart gave me the best deal and did a superb job of mounting. The ride is exceptional and they stick to the road like glue.

  12. JIm Thykeson Says:

    Until GM answers the big question on the Volt’s ability to keep on going after it’s 300 mile range (battery and the 3-cyl. engine supply) expire, no one will have the confidence to plunk down that $40G. It behoves them to answer the ‘range’ question now!

  13. pedro Fernandez Says:

    I think the Volt will be a “niche” car, not as popular as the Prius, simply because its more expensive and people are going to be apprehensive about its reliability.

  14. R. Rufty Says:

    Government Motors should go broke. Build it in the USA, sell it in the USA.