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[Due to the increasing size of the archives, each topic page now contains only the prior 365 days of content. Access to older stories is now solely through the Monthly Archive pages or the site search function.]
BMW Debuts 6th Generation of 5 Series Sedan; Auto Stop Start on 520d and BluePerformance on 530d for Euro 6 Compliance
November 23, 2009
| The new 5 Series. Click to enlarge. |
BMW held the world debut of the 6th generation BMW 5 Series today in Munich. In the course of five model generations, overall sales of the BMW 5 Series have reached more than 5.5 million units.
The new BMW 5 Series Sedan is making its debut with one eight-cylinder and three six-cylinder gasoline engines as well as two six-cylinder diesels. The range is rounded off by a four-cylinder turbodiesel (the 520d) with an aluminium crankcase and common-rail direct injection.
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EPA Reports Fifth Consecutive Annual Increase in US New Vehicle Fuel Economy; Up 9% Since 2004, Back to Levels of Early 1980s
November 20, 2009
| Adjusted CO2 emissions and adjusted fuel economy by model year. Source: EPA. Click to enlarge. |
For the fifth consecutive year, the US Environmental Protection Agency (EPA) is reporting an increase in new vehicle fuel efficiency with a corresponding decrease in average carbon dioxide emissions for new US cars and light duty trucks. This marks the first time that data for CO2 emissions are included in the annual report, Light-Duty Automotive Technology, Carbon Dioxide Emissions, and Fuel Economy Trends: 1975 through 2009.
For 2008, the last year for which EPA has final data from automakers, the average fuel economy value was 21.0 mpg US (11.2 L/100km). EPA projects a small improvement in 2009, based on pre-model year sales estimates provided to EPA by automakers, to 21.1 mpg (11.1 L/100km). The projected fleetwide average real world MY2009 light-duty vehicle CO2 emissions level is 422 grams per mile (g/mi); the fleetwide average MY2008 value is 424 g/mi.
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Study Concludes That Class 8 Truck Fuel Consumption Could Be Reduced By Up to 50% By 2017 Using Existing and Emerging Technologies; Current Payback Requirements Could Forestall Implementation
A new study released today by the Northeast States Center for a Clean Air Future (NESCCAF) and the International Council on Clean Transportation (ICCT) found that fuel consumption of Class 8 trucks and the resultant greenhouse gas (GHG) emissions can be reduced up to 50% with the adoption of current and developing technologies and new operational measures by 2017.
However, the study also concluded that given the current short payback period for investment demanded by the trucking industry, a number of the technologies that could enable such savings would not be adopted, absent regulation or a longer payback period.
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Study of Sustainable Value in Automobile Manufacturing Finds Mixed Performance for Most OEMs, BMW and Toyota as the Clear Leaders
November 06, 2009
| Sustainable Value Margin—the ratio of Sustainable Value to sales—for each of the evaluated manufacturers. BMW and Toyota are consistent leaders in sustainable value. Click to enlarge. |
A survey of the sustainability performance of 17 of the world’s leading automakers has found a mixed pattern when it comes to the sustainability performance of most of the car manufacturers. The BMW Group and Toyota are consistent industry leaders, creating extremely positive Sustainable Value over the entire review period—i.e., they use all the economic, environmental and social resources considered in a value-creating way.
The report, which covers the period between 1999 and 2007, applies the Sustainable Value approach developed by Prof. Frank Figge of Queen’s University Belfast and Dr. Tobias Hahn of Euromed Management School Marseille. The research project was undertaken by researchers working at Euromed Management School Marseille, Queen’s University Belfast and IZT—Institute for Futures Studies and Technology Assessment in Berlin.
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Chrysler Powertrain Strategy to Rely Heavily on Integrating Fiat Engine Technology; Chrysler to Be Global Center of Competence for Hybrids and EVs for Fiat and Chrysler
November 04, 2009
| Chrysler’s new powertrain strategy relies heavily on the rapid integration of Fiat technologies. Click to enlarge. |
Chrysler’s new powertrain strategy is relying on the rapid transfer of Fiat Group technology for Multiair; Gasoline Direct Injection; turbocharging and alternative fuels to support rapid downsizing and improvement of fuel economy, along with the simplification of the company’s engine line-up, according to Paolo E. Ferrero, Senior Vice President, Chrysler Powertrain. Ferrero was speaking during a briefing at Chrysler headquarters today outlining the company’s new five-year business plan.
In addition, Ferrero said, the Chrysler Group will be the global center of engineering competence for hybrids and electric vehicles for Fiat Group and Chrysler Group.
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Tata Motors Selects EIG Lithium-ion Polymer Batteries for Indica Vista Electric Vehicle Program
October 27, 2009
| EIG will supply 20Ah NCM Li-ion polymer cells to Miljøbil Grenland AS. Click to enlarge. |
Miljøbil Grenland AS, a Norwegian subsidiary of Tata Motors European Technical Centre plc., awarded South Korea-based Energy Innovation Group Ltd. (EIG) a contract to supply batteries for the Indica Vista EV project (earlier post), a development of the TATA Indica Vista.
Within the supply agreement, EIG Ltd. is to supply 20Ah lithium-ion polymer cells to Miljøbil Grenland AS for the design validation and the subsequent engineering sign-off scheduled for early 2010. The supply agreement envisions the supply of two million battery cells as well as the associated parts and services through the end of 2012.
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Ford CEO Unveils New Figo for India Market and Export Sales, New Manufacturing Plant in China with Changan
September 25, 2009
| The Ford Figo. Click to enlarge. |
Ford Motor Company President and CEO Alan Mulally revealed the new Ford Figo, the anticipated new car to be produced in India and targeted at the India and export market. Ford said that Mulally’s visit for the reveal underscores the strategic importance of India in Ford’s future plans.
The new Ford Figo will be manufactured at Ford’s expanded integrated manufacturing facility near Chennai, which is undergoing a $500 million transformation to become a regional center of excellence for Ford small car production. (Earlier post.) The investment is doubling production capacity to 200,000 units per year.
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Volkswagen Group to Invest €4B by 2011 to Expand Activities in China
September 12, 2009
The Volkswagen Group is set to continue its growth in China over the next few years. Between 2009 and 2011, the Group is to invest a total of €4 billion (US$5.8 billion) in new products and the expansion of production capacities in China.
The investments are to be financed from the cash flow of the Chinese joint venture companies. At the Nanjing and Chengdu plants, production is to be boosted to between 300,000 and 350,000 units in each case by 2012. These investment plans were approved on Friday by the Supervisory Board of Volkswagen Aktiengesellschaft.
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GM Board Recommends Selling Majority Stake in Opel/Vauxhall to Magna International/Sberbank; Opel/Vauxhall to Remain Part of GM Global Product Development
September 10, 2009
Ending what had extended into a longer-than-expected process of deliberation and negotiations, the Board of General Motors announced its support for a bid from the consortium of Magna International Inc. and Sberbank to buy a majority stake in its European Opel/Vauxhall operations.
Several key issues will be finalized over the next few weeks to secure the binding agreements, including the written support of the labor unions to support the deal with the necessary cost restructuring for viability and the finalization of a definitive financing package from the German government. The definitive agreements should be ready to sign within a few weeks, with closing to follow within the next few months. Under the deal, Magna/Sberbank will purchase a 55% stake in New Opel; GM will hold a 35% stake and employees will be provided a 10% stake.
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Perspective: A View Into the New GM
August 30, 2009
by Bill Cooke
| The Saturn version of the two-mode plug-in hybrid at the Milford Proving Grounds. Click to enlarge. |
On 11 August, GM invited approximately 75 journalists and auto analysts to spend a day learning about the new GM. The day was split between a morning session at the GM tech center in Warren and an afternoon session at the GM proving grounds in Milford, MI.
The morning session started out with an hour long press conference, the highlight being the unveiling of the Volt’s 230 mpg preliminary EPA city fuel economy finding (earlier post), as well as a tour showing selected elements from the studios of the four GM North American brands: Chevrolet, GMC, Buick and Cadillac.
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Saab to Introduce New 9-5 at Frankfurt
August 27, 2009
| The new Saab 9-5 will debut in Frankfurt. Click to enlarge. |
Saab provided initial information on its new 9-5 sedan, which will have its world debut at the upcoming Frankfurt Motor Show in September. The new sedan is slated to go on sale in 2010.
The all-turbo powertrain line-up is the broadest ever offered by Saab, carrying forward Saab’s rightsizing engine strategy through the development of efficient four-cylinder turbo engines. There is a choice of three fuels: gasoline, diesel and E85 bioethanol. A four-cylinder, 2.0-liter turbo diesel with six-speed manual transmission diesel offers CO2 emissions as low as 139 g/km and fuel consumption of 5.3 L/100km (44.4 mpg US).
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GM and Koenigsegg Sign Stock Purchase Agreement For The Sale Of Saab
August 18, 2009
General Motors Co. confirmed it has signed a stock purchase agreement with Koenigsegg Group AB regarding the sale of 100% of the shares of Saab Automobile AB. The deal is expected to conclude in the next months. Saab Automobile plans to exit legal reorganization shortly.
The stock purchase agreement will be subject to agreed closing conditions. Conditions to close the sale include expected funding commitments with Swedish government support and guarantees, as well as transitional assistance from GM, as Saab becomes independent. Saab is about to launch several new cars, developed with General Motors, that are in the final stages of development.
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VW and Porsche to Merge; New Integrated Auto Group with 10 Brands, Led by VW
August 13, 2009
At its extraordinary meeting today, Volkswagen AG’s Supervisory Board approved the comprehensive agreement to create an integrated automotive group with Porsche, led by Volkswagen. A corresponding agreement has been negotiated by Volkswagen AG and Porsche Automobil Holding SE, as well as the Porsche and Piëch family shareholders and the employee representatives of the companies involved.
Porsche Automobil Holding SE’ss Supervisory Board has also approved the concept for the combination of the two companies. The comprehensive agreement seals the creation of a joint group with ten strong brands. The plans will culminate in the merger of Porsche SE with Volkswagen. This is expected to be completed in the course of 2011, and will require the approval of both companies' shareholders.
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EIB to Contribute Up to €300M in Financing to Valeo for €645M Fuel Consumption and Emissions Reduction Projects
July 26, 2009
The European Investment Bank (EIB) will grant financing of up to €300 million (US$426 million) to Valeo for its current research projects aiming to reduce the fuel consumption and CO2 emissions of cars and improve active safety. The total research investment of Valeo, one of the world’s top automotive suppliers, for these projects is €645 million (US$916 million) over four years. The EIB loan will come with competitive terms in two installments, the first one of €225 million (US$320 million) to be drawn by the end of July.
Aligned with the objective of the European Union to establish a competitive knowledge-based economy and the policy of the EIB to finance research and innovation as a priority, this funding will cover fuel efficiency technologies such as mild- and micro-hybrid solutions; the development of systems for electric and hybrid vehicles; efficient transmission systems; and active safety technologies including assisted viewing systems, crash avoidance systems and advanced lighting systems.
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Opel Launches Broad LPG ecoFLEX Range; GM Having Detailed Final Talks with Magna and RHJI on Offers for Opel
July 23, 2009
| Opel’s LPG range. Click to enlarge. |
Opel is now offering five dual-fuel LPG (Liquefied Petroleum Gas)-powered Corsa, Meriva, Astra station wagon and Zafira models with a wide performance range, expanding its line of ecoFLEX models with alternative propulsion. The Opel LPG models can run on gasoline or LPG—the switch happens automatically, but can also be made by pressing a button.
In addition to the standard gasoline tank, these models also feature an LPG tank located either in the spare-wheel well (Corsa, Meriva, Astra station wagon) or under the vehicle floor (Zafira), ensuring storage space and load volume remain unchanged. Instead of the spare wheel, a tire repair set is on board for emergencies.
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GM Brazil to Invest R$2B in Expansion and New Line of Chevrolet Small Cars
July 16, 2009
General Motors Brazil will invest R$2 billion (US$1.033 billion) to launch a new Chevrolet line of vehicles and to expand its plant in Gravataí, Rio Grande do Sul. The investment is the largest made by the company in its 84 years in Brazil.
Included in the investment program is the renewal of the current line of Chevrolet vehicles in 2012, and the launch of a new line of small cars (two models) for Brazil and emerging markets—“Project Onyx.”
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Euro Auto Production Down 35% in First Quarter 2009; Second Half Production May be Down 25%; Small Cars Hit New Record Share
July 15, 2009
| The small car segment has increased its share. Source: ACEA. Click to enlarge. |
In the first quarter of 2009, automotive production in Europe fell by 35% to 3.4 million vehicles, according to the latest Economic Report from the European Automobile Manufacturers Association (ACEA). While fleet renewal schemes (vehicle scrappage) have helped segments of the passenger car market in some countries, overall vehicle demand in Europe went further down as well.
Van (-57%) and truck production (-56%) dropped even more than the manufacture of passenger cars (-31%). With a drop of 57.4%, the UK was the worst affected of the five largest European producers, followed by France (-46.0%), Spain (-40.2%), Italy (-38.6%) and Germany (-32.3%). In Austria, production went down by 69.2%.
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The New General Motors Launches; Lutz “Unretiring”
July 10, 2009
The new, downsized General Motors Company emerged from bankruptcy Friday morning. Created from the old GM’s strongest operations in an asset sale approved by the Federal bankruptcy court on 5 July (earlier post), the new GM is built on four core brands: Chevrolet, Cadillac, Buick and GMC. The four brands will offer a total of 34 nameplates by 2010, compared to old GM’s total of 48 in 2008 and 63 in 2004.
The new General Motors Company is primarily owned by the governments of the United States, Canada and Ontario, and by a trust fund providing medical benefits to UAW retirees. Specifically, common stock will be owned by:
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Fiat Group and Guangzhou Automobile Group Creating JV for Chinese Market
July 07, 2009
| The agreement was signed in Rome by Zhang Fangyou, Chairman of GAC Group, and Sergio Marchionne, CEO of Fiat Group, in the presence of the President of the People’s Republic of China, Hu Jintao, and the Prime Minister of Italy, Silvio Berlusconi. Click to enlarge. |
Fiat Group and Guangzhou Automobile Group Co. Ltd. (GAC Group) signed a Framework Agreement to establish a 50/50 joint venture for the production of cars and engines for the Chinese market.
The models produced will be equipped with the latest in engine and transmission technology in response to the Chinese government’s requirement to develop fuel-efficient, low-emission vehicles. The first model to be launched will be the C-segment Linea sedan. The first engines will be the Fire 1.4L 120 hp and 150 hp T-Jet.
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Federal Bankruptcy Court Approves GM Asset Sale to New GM
July 06, 2009
Judge Robert Gerber of the US Bankruptcy Court for the Southern District of New York approved the sale of substantially all of General Motors Corporation’s assets to NGMCO, Inc., an entity funded by the US Department of the Treasury. The approval marks a necessary step toward the emergence of GM from bankruptcy; the US Treasury has said it would halt funding to GM if the asset sale was not concluded by 10 July.
In connection with the closing of the sale transaction, NGMCO, Inc. will change its name to General Motors Company and continue to operate under GM’s historic corporate and sub brands. The current General Motors Corporation will change its name to Motors Liquidation Company. Retained assets will be wound down or sold. A new board of directors will oversee that process and the liquidation of the company under the supervision of the Bankruptcy Court.
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VW Chief Executive Says Company Will Introduce EVs Based on the Up! New Small Family in 2013; Cautions Against “Electro-Hype”
July 04, 2009
Cautioning that the development and commercialization of the electric car is “not a sprint, but a marathon”, Volkswagen AG Chairman of the Board of Management Prof. Dr. Martin Winterkorn said that Volkswagen would introduce its first electric vehicles based on the up! New Small Family (earlier post) in 2013. Within a decade, he added, Volkswagen wants to offer significant numbers of pure electric cars at affordable prices and with the range expected by customers.
Winterkorn made the remarks during a presentation at the 17th Handelsblatt-Jahrestagung in Munich on 3 July, during which he outlined VW’s approach to future mobility in the current context of the economic crisis, pessimism about the industry and technology potential.
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Nissan Updates on Nissan Green Program 2010; New Vehicle CO2 Needs to Be Reduced 90% by 2050
June 22, 2009
Nissan Motor Co., Ltd. provided an update on its progress under the Nissan Green Program 2010 (NGP 2010) mid-term environmental plan. Nissan also announced the introduction of an automatic transmission (AT) model with a clean-diesel engine in the Japanese market, planned for spring 2010.
Along with the mid-term NGP 2010 plan, originally announced in December 2006, Nissan is reviewing its long-term CO2 emissions-reduction scenarios. According to the IPCC (Intergovernmental Panel on Climate Change) Fourth Assessment Report (AR4), global CO2 concentration in the atmosphere should be stabilized below 450 ppm, Nissan noted. Nissan estimates—based on the findings of AR4—that the CO2 emissions of all new vehicles in 2050 would need to be reduced by 90% compared to the 2000 level. Based on this scenario, Nissan will conduct a review of its road map for CO2 emissions reduction of new vehicles and reflect it in the next mid-term environmental action plan.
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Volvo to Introduce Proprietary Medium-Duty Engine in 2010
June 17, 2009
The Volvo Group is developing its own medium-duty (MD) engine for trucks and buses. The first of these new medium-duty engines will be launched in 2010, according to Volvo CEO Leif Johansson in his presentation at Volvo’s Capital Market Day in Eskilstuna, Sweden.
Johansson also said that the Volvo Group’s investments in research and technology will remain at high levels in the next few years since new emissions legislation will be introduced for trucks, buses and construction equipment.
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New Chrysler Group LLC and Fiat Finalize Global Strategic Alliance; New Global Brand-Focused Structure
June 10, 2009
With the US Supreme Court yesterday clearing the final potential obstacle, Chrysler Group LLC and Fiat Group finalized their previously announced global strategic alliance, forming the “new" Chrysler. The “old” Chrysler had entered bankruptcy on 30 April 2009. The new Chrysler will begin operations immediately.
Under the terms approved by the US Bankruptcy Court in New York and various regulatory and antitrust regulators, the company formerly known as Chrysler LLC today formally sold substantially all of its assets, without certain debts and liabilities, to a new company that will operate as Chrysler Group LLC.
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GM Files Voluntary Chapter 11; Agreements with US Treasury and Canada; “New GM” Expected in 60-90 Days
June 01, 2009
General Motors Corp. reached agreements with the US Treasury and the governments of Canada and Ontario for the creation of a smaller, self-sustaining “New GM”. Pending approvals, the New GM is expected to launch in about 60 to 90 days as a separate and independent company from the current GM.
The New GM will incorporate only the “best brands” and operations, and benefit from shedding much of the older debt burden and operating cost structure. The New GM will incorporate the terms of GM’s recent agreements with the United Auto Workers (UAW) and Canadian Auto Workers (CAW) unions and will be led by GM’s current management team.
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Vehicle Electrification a Key Strategic Initiative for Magna; Steady Increases in Capabilities and Technology Portfolio Over Past Few Years
May 30, 2009
Canada-based international auto supplier and contract assembler Magna International, now with a Memorandum of Understanding for the acquisition of Opel from General Motors (earlier post), sees vehicle electrification as one of its key strategic initiatives. Accordingly, it has been steadily increasing its capabilities with hybrid and electric vehicle technologies over the past several years.
At Magna’s Annual General Meeting, held earlier this month, Magna Co-Chief Executive Officer Siegfried Wolf noted that Magna has the capability to develop and produce many of the key components that are new and unique to electric vehicles. A key competitive advantage for the company, he said, is its “ability to integrate these new technologies into the complete vehicle and to develop complete vehicle concepts for pure electric mobility.”
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Renault and Nissan to Accelerate Cooperation, Seeking €1.5 billion in Free Cash Flow in 2009 from Synergies
May 29, 2009
Ten years into their Alliance, Renault and Nissan are taking the cooperation to a higher level. In 2009, identified synergies are to contribute €1.5 billion (US$2.1 billion) in free cash flow divided evenly to the Alliance partners. A small, dedicated team has been set up to foster deeper, broader cooperation and to maximize the contribution of these synergies to the performance of both partners.
Since 1999, Renault and Nissan have achieved and developed an alliance that has created significant value for the two companies. The achievements include shared platforms and powertrains, cooperation on advanced technologies, standardization of manufacturing methods, the expansion of the product line-ups and the extension of the global footprint of each partner. Combined vehicle sales have increased from 4.9 million units in 1999 to 6.9 million in 2008 (including Avtovaz), making the Renault-Nissan Alliance the world’s third-largest automotive group.
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Daimler Takes 10% Stake in Tesla; Strategic Partnership to Collaborate on Future Models
May 19, 2009
Daimler AG has acquired an equity stake of nearly 10% in Tesla Motors Inc. The two companies have already been working closely to integrate Tesla’s lithium-ion battery packs and charging electronics into the first 1,000 units of Daimler’s electric smart car. (Earlier post.)
This investment deepens the relationship between the two, and enables the partners to collaborate even more closely on the development of battery systems, electric drive systems and in individual vehicle projects. Executives from both companies announced the arrangement this morning in a webcast press conference.
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Honda Begins Production of Civic GX Natural Gas Vehicles at Indiana Plant
May 15, 2009
Honda Manufacturing of Indiana, LLC (HMIN) began production of the natural gas-powered 2009 Civic GX at its plant in Greensburg, Indiana. The Civic GX was formerly produced at Honda’s East Liberty, Ohio plant and has ten years of proven performance as a natural gas powered vehicle. The Civic GX is the only natural gas vehicle built by a major automaker in the US.
First introduced in 1998, the Civic GX is the cleanest internal combustion vehicle certified by the EPA—90% cleaner than the average gasoline-powered car on the road today. As a result, the GX is certified by the EPA as an Inherently Low Emissions Vehicle (ILEV). It is the only natural gas powered passenger car available for sale in all 50 states, and is eligible for a $4,000 federal tax credit as a qualified alternative fuel vehicle.
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GM And University of Michigan Form GM/U-M Institute Of Automotive Research And Education; Focus On Fuel-Efficiency And Reinvention Of The Automobile
May 07, 2009
General Motors and the University of Michigan have formed the GM/U-M Institute of Automotive Research and Education, with a strategic focus on reinventing the automobile and developing the next generation of high-efficiency vehicles powered by diverse energy sources.
The Institute, which builds on more than 50 years of collaboration between the organizations, supplements GM’s ongoing research and development in key areas: advanced batteries, engine systems, smart materials and vehicle manufacturing.
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Ford Investing $550M to Retool SUV Plant to Produce Focus Small Car and EV
May 06, 2009
Ford Motor Company is investing $550 million to transform its Michigan Assembly Plant into a flexible manufacturing complex that will build Ford’s next-generation Focus global small car along with a new battery-electric version of the Focus for the North American market. (Earlier post.) The 2.866 million square-foot plant was built in 1957.
The plant, formerly the Michigan Truck Plant and the production site for Ford Expedition and Lincoln Navigators SUVs, is one of three North American light truck plants Ford is retooling to build fuel-efficient global small cars in the coming years. The new Focus will begin rolling off the line next year and the battery-electric version of the Focus—Ford’s first all-electric passenger car—debuts in 2011.
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Automotive Market Research Perspectives on Selling “Green” in a Try-to-Survive Market
May 02, 2009
by Bill Cooke
In a panel session entitled “Does Green Matter in a Try-to-Survive Market?” at the ATX-Consulting4Drive Executive Business Theater at the SAE 2009 World Congress, executives from two global automotive market research groups—Alexander Edwards, President of Strategic Vision’s Automotive Division and Scott Miller, CEO, Synovate Motoresearch—shared their data and resultant views on green consumers and green autos.
How big is the green market? Strategic Vision shared data that only a small portion of consumers in the US are “truly green”, which means the customer is willing to pay significantly more for a green vehicle. Even globally the number is relatively small:
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Chrysler Files for Bankruptcy; Reaches Agreement with Fiat for New Company; Fiat Percentage Ownership Tied to Fuel-Efficiency Targets
April 30, 2009
Chrysler LLC has been unable to obtain the necessary concessions from all of its lenders which would have avoided the need for a bankruptcy proceeding. As a result, under the direction of the US Treasury, Chrysler LLC and 24 of its wholly-owned US subsidiaries today filed voluntary petitions under Chapter 11 of the US Bankruptcy Code in US Bankruptcy Court for the Southern District of New York.
Chrysler has also reached an agreement in principle to establish a global strategic alliance with Fiat SpA to form a new company. It would allow Chrysler and Fiat to fully optimize their respective manufacturing footprints and the global supplier base, while providing each with access to additional markets. Fiat powertrains and components would also be produced at Chrysler manufacturing sites.
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GM Releases New Viability Plan, Launches Bond Exchange; Phasing Out Pontiac
April 27, 2009
General Motors presented an updated Viability Plan that accelerates and deepens the cuts in US brands and nameplates, dealers, manufacturing operations and employees intended to enable GM North America to breakeven (on an adjusted EBIT basis) at a US total industry sales volume of approximately 10 million vehicles. As part of the new plan, GM will accelerate the wind-down or sale of HUMMER, Saturn and Saab to the end of 2009, and phase out Pontiac by the end of 2010.
The new plan is included in the prospectus for bond exchange offer in which GM is offering certain bondholders 225 shares of GM common stock for each $1,000 principal amount of GM notes and a cash payment for all accrued but unpaid interest to the settlement date. The bond exchange is a critical step; failure will result in GM’s entering the bankruptcy process. If the exchange succeeds, GM shares will be 89% owned by a combination of the US Treasury and the UAW Voluntary Employee Benefit Association (VEBA); the US Treasury will own at least 50%.
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Plug In America Challenges Obama Auto Task Force Conclusion on GM Volt, Proposes Reduction in Warranty Terms to Reduce Manufacturer Cost
March 31, 2009
In response to the Presidential Auto Task Force Report that concluded that the plug-in Chevrolet Volt was unlikely to be commercially successful in the short-term due to its cost (earlier post), Plug In America is proposing a plan to make GM’s Chevy Volt and other plug-in cars more affordable. Plug In America also noted that most advanced new technologies are initially more costly.
California law requires that the Volt and other plug-in hybrids come with a 10-year warranty. To ensure this longer life, automakers are as much as doubling the size of the battery pack, increasing cost to manufacturer and consumer. But not a single production plug-in electric vehicle sold to date, from GM’s early EV1 to today’s Tesla, has had a warranty of more than five years, noted Plug In America advisory board member Chelsea Sexton.
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Presidential Auto Task Force Concluded Plug-In GM Volt Likely “Too Expensive To Be Commercially Successful in the Short-Term”
Following the short address on Monday during which President Barack Obama outlined the next steps for GM and Chrysler (earlier post), the White House posted summaries of the Presidential Auto Task Force’s assessment of the business plans provided by the two struggling automakers, which led to the terms that are currently unfolding.
Among the highlights of the brief summaries was the conclusion that while the Chevy Volt extended range electric vehicle holds promise, “it will likely be too expensive to be commercially successful in the short-term.”
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Honda, ATR and Shimadzu Jointly Develop Non-Invasive Brain-Machine Interface Technology Enabling Control of a Robot by Human Thought Alone
| The test process for Honda’s Brain-Machine Interface technology including conceptual diagram of the brain activity measuring device, example of obtained data, and example of distinguishing results. Click to enlarge. |
Honda Research Institute Japan Co., Ltd. (HRI-JP), a subsidiary of Honda R&D Co., Ltd., Advanced Telecommunications Research Institute International (ATR) and Shimadzu Corporation have collaboratively developed what they believe is the world’s first Brain Machine Interface (BMI) technology that uses electroencephalography (EEG) and near-infrared spectroscopy (NIRS) along with newly developed information extraction technology to enable control of a robot by human thought alone.
It does not require any physical movement such as pressing buttons. This technology will be further developed for the application to human-friendly products in the future by integrating it with intelligent technologies and/or robotic technologies.
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Obama Outlines Next Steps for GM and Chrysler
March 30, 2009
In a statement livecast on the Internet by the White House, President Barack Obama said that neither of the restructuring plans submitted by GM and Chrysler “goes far enough to warrant substantial new investment.”
In his short address, the President confirmed details that had emerged over the weekend about the next steps for the two auto makers. The government will provide GM with “adequate working capital” for 60 more days to “produce a better business plan”. Chrysler, which the government has determined requires a partner to survive, will have 30 days of working capital to conclude a deal with Fiat.
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GM Europe/OPEL to Submit Plan for Viability
February 27, 2009
GM Europe and the Opel Supervisory Board have approved a confidential long-term plan for viability that will be submitted to government representatives in the coming days.
The confidential document includes a funding request for €3.3 billion (US$4.2 billion) in government support (German and other governments), €3 billion (US$3.8 billion) in support from GM and $1.2 billion (€0.95 billion) in structural cost reductions as outlined in GM’s latest version of its viability plan submitted to the US Congress.
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Saab to Give 9-3X its Debut in Geneva; E85 Plus All-Wheel Drive
February 23, 2009
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| The 9-3X. Click to enlarge. |
Saab will introduce the new 9-3X to the public at the upcoming Geneva motor show in March. The 9-3X sport wagon offers a lighter alternative to heavier and larger crossovers or SUVs. The 210 hp (155 kW), 2.0-liter turbo engine couples Saab’s E85-capable BioPower technology with all-wheel-drive for the first time. A 180 hp (132 kW), two-stage 1.9-liter turbo diesel option is also available with two-wheel drive transmission.
Saab is splitting off from General Motors, which acquired 50% of Saab in 1990 and subsequently acquired the remaining shares. (Earlier post). On 20 February, the Vänersborg District Court in Sweden approved the request for a reorganization and restructuring which Saab’s representative had submitted earlier in the morning.
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Saab to Separate from GM and Create Independent Business in Sweden
February 20, 2009
As a result of GM’s strategic review of the global Saab business, the Saab Board announced today that it will file for reorganization under a self-managed Swedish court process to create a fully-independent business entity that would be sustainable and suitable for investment.
The reorganization is a self-managed, Swedish legal process headed by an independent administrator appointed by the court who will work closely with the Saab management team. As part of the process, Saab will formulate its proposal for reorganization, which will include the concentration of design, engineering and manufacturing in Sweden.
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GM and Chrysler Submit Updated Restructuring Plans; Up to $18.6B More Needed; Outlines for Product Plans
February 18, 2009
As required by the loan agreements signed in December 2008, GM and Chrysler submitted their updated restructuring plans showing a pathway to achieve financial viability to Congress on Tuesday. The plans, updated in the context of a worsening sales outlook for the entire auto industry, outline a need for up to an additional $16.6 billion in Federal support for GM and $2 billion for Chrysler; deeper job and brand cuts; as well as product plans for the surviving versions of the automakers.
GM. Following the steep decline in US industry sales in December 2008 and January 2009, GM responded by further lowering its forecast for 2009 US industry sales to 10.5 million units (57.5 million units globally) for viability planning purposes. These industry planning volumes are more conservative than those being used by most other industry sources.
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Renault Powertrain Strategy: Focus on Electric Motor Development for EV Powertrains, New Technologies for Conventional Engines
February 17, 2009
Renault is currently working on the development of low-emission and zero-CO2 emissions vehicles in what it calls “a determined bid” to introduce as many effective technologies as possible at an affordable price. Its work on powertrains focuses on two main areas: the development of a range of electric motors for all-electric vehicles, and new technologies for conventional engines, including a new generation of turbocharged internal combustion engines as well as on new automatic transmissions.
Electric motors. Renault is aiming to become the industry leader in the realm of mass-market electric vehicles. The Renault-Nissan Alliance is consequently developing a comprehensive range of all-electric powertrains, with power outputs ranging from 50 to 100 kW (70 to 140 hp).
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Fiat Group and Chrysler Plan New Global Strategic Alliance; Fiat to Have 35% Stake in Chrysler
January 20, 2009
Fiat S.p.A., Chrysler LLC (Chrysler) and Cerberus Capital Management L.P., the private investment majority owner of Chrysler LLC, have signed a non-binding term sheet to establish a global strategic alliance that will result in Fiat having a 35% stake in the Detroit-based automaker.
As a consideration for Fiat Group’s contribution to the alliance of strategic assets, to include: product and platform sharing, including city and compact segment vehicles, to expand Chrysler’s current product portfolio; technology sharing, including fuel-efficient and environmentally friendly powertrain technologies; and access to additional markets, including distribution for Chrysler vehicles in markets outside of North America, Fiat would receive an initial 35% equity interest in Chrysler. The alliance does not contemplate that Fiat would make a cash investment in Chrysler or commit to funding Chrysler in the future.
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KPMG Global Auto Executive Survey Highlights Impact of Downturn on Industry; Increasing Importance of Hybrid, Electric and Battery Technologies
January 10, 2009
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| Concerns about the global economy and environmental issues have grown steadily in importance to the industry, according to the latest survey findings. Source: KPMG. Click to enlarge. |
The just-released tenth consecutive annual survey of senior global auto executives carried out by KPMG firms—The KPMG Global Auto Executive Survey 2009—highlights the impact of the economic crisis on the global automotive industry. The survey found that sales and profitability expectations are down sharply; that more bankruptcies are expected, along with intensive restructuring; that costs must be cut, meaning process innovation will have to intensify; and that auto execs expect that customers will become more discriminating, and more concerned with total cost of ownership.
However, the industry also sees great opportunities in new technologies, particularly alternative fuel and fuel efficiency technologies. Despite the fall in oil prices during late 2008, companies have increased their sales expectations for hybrid and alternative propulsion vehicles.
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Japan Vehicle Production and Exports Down 20.4% and 18.1% Respectively in November
December 26, 2008
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| Vehicle production in Japan dropped 20.4% in November year-on-year. Cars of more than 2.0L displacement suffered the largest drop. Click to enlarge. Data: JAMA |
Total production of cars, trucks and buses in Japan for domestic sales as well as for export dropped 20.4% in November year-on-year to 854,171 units, according to figures released by the Japan Automobile Manufacturers Association (JAMA). This marked the second consecutive month of year-on-year production decreases, and is the largest monthly on-year decline since JAMA began compiling data in 1967.
Vehicle exports from Japan in November 2008 were 491,990 units, down 18.1% compared with the units total recorded for the same month of the previous year. This marks an export decrease on the same month of the previous year for two consecutive months.
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GM Holden To Build New Small Car Alongside Commodore
December 22, 2008
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| Concept sketch of the new Holden small car. Click to enlarge. |
GM Holden will build an all-new small car in Australia alongside the Commodore range. The second carline will start in the third quarter of 2010 with support from the Federal and South Australian Governments. It will be GM Holden’s first locally produced car beyond its current range of larger vehicles since the Asian economic crisis ended Vectra production in 1998.
The vehicle will be based on GM’s global Delta small car platform and feature new technologies to increase fuel efficiency and reduce greenhouse emissions. Other applications of the Delta platform will include the next-generation Chevrolet Cruze and Opel, Vauxhall and Saturn Astra.
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Canada to Provide C$4B in Loans to GM and Chrysler
December 21, 2008
Canada Prime Minister Stephen Harper and Ontario Premier Dalton McGuinty announced that the Government of Canada and the Government of Ontario would provide up to C$4 billion (US$3.3 billion) in loans payable to General Motors of Canada Limited (up to C$3 billion) and Chrysler Canada Inc. (up to C$1 billion) through Export Development Canada (EDC).
GM will receive C$0.8 billion on closing (29 December); C$1.2 billion on 30 January 2009; and C$1.0 billion on 27 February 2009. Chrysler will receive C$0.4 billion on closing (29 December); C$0.4 billion on 30 January; and C$0.2 billion on 27 February.
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Honda Adjusts to Deteriorating Markets; Focus on Hybrids and Small Cars, Delayed Introduction of New Diesel in US and Japan
December 20, 2008
In his year-end speech, Honda CEO Takeo Fukui outlined the steps Honda is taking in the short term to deal with the global automobile industry crisis while still addressing the mid- to long-term challenges Honda faces, which “have not fundamentally changed.”
More than ever, Fukui said, Honda will concentrate its resources on the development of fuel-efficient products. “The keys to achieve this goal are advancements of electromotive technologies including hybrid models as well as motorcycles and small cars.”
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US to Provide Up To $17.4B in Loans to GM and Chrysler
December 19, 2008
The US federal government will provide up to $13.4 billion in loans to GM and $4.0 billion to Chrysler under terms similar to those Congress considered last week. The funds will be provided by the US Department of the Treasury from the $700 billion TARP (Troubled Asset Relief Program) package passed earlier this year to address the crisis in the financial sector.
Under the terms of package announced by President Bush, the automakers have three months to put into place plans to restructure into financially viable companies. If restructuring cannot be accomplished outside of bankruptcy, the loans will provide time for the companies to make the legal and financial preparations necessary for an orderly Chapter 11 process that offers a better prospect of long-term success.
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Mercedes-Benz to Present BlueZERO Modular Drive Concept for Electric Vehicles at Detroit Show
December 15, 2008
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| The BlueZERO concept. Click to enlarge. |
Mercedes-Benz will present its near-series electric-drive Concept BlueZERO at the North American International Auto Show in Detroit in January.
Based on a single vehicle architecture, this modular concept allows three models with different drive configurations: the BlueZERO E-CELL with battery-electric drive and a range of up to 200 km (124 miles); the BlueZERO F-CELL (fuel cell) with a range of more than 400 km (249 miles); and the BlueZERO E-CELL PLUS with electric drive and internal combustion engine as range extender. The BlueZERO E-CELL PLUS has an overall range of up to 600 km (373 miles) and can cover a distance of up to 100 km (62 miles) using electric drive alone.
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Evonik and Daimler Establish Strategic Alliance for Automotive Li-ion Battery Research, Development and Production; Li-Tec Cells to Be Used in Mercedes EVs
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| A Li-Tec 40 Ah high-energy cell. Click to enlarge. |
Evonik Industries AG and Daimler AG have established a strategic alliance to further the research, development and production of lithium-ion battery cells and battery systems in Germany. (Earlier post.)
The two companies will form a joint venture focused on the development and production of batteries and battery systems for automotive applications. Daimler will hold 90% of this joint venture, and Evonik 10%. In addition, Daimler is acquiring 49.9% of Evonik Group subsidiary Li-Tec—Evonik Industries AG already holds 50.1%. As part of the agreement, Mercedes will use Li-Tec lithium-ion cells in upcoming series-production electric vehicles.
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US House Passes $14B Auto Industry Restructuring Package
December 11, 2008
The US House of Representatives yesterday passed HR 7321, the Auto Industry Financing and Restructuring Act, by a vote of 237 to 170 (largely along party lines). The legislation, worked out with the White House, provides up to $14 billion in short-term bridge loans for the auto industry, laced with a number of restrictions and controls.
The legislation now goes to the Senate for consideration, where it faces considerable Republican opposition. The White House is urging passage.
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Analysis Concludes Automaker Bankruptcy Could Cost US Taxpayers US$65.9 Billion
December 08, 2008
The bankruptcy (first Chapter 11 reorganization, then proceeding to Chapter 7 liquidation) of two of the Detroit automakers would cost US taxpayers US$65.9 billion over two years, compared to a taxpayer cost of US$16.4 billion for partially repaid bridge loans, according to a joint analysis by Anderson Economic Group (AEG) and BBK, an international business advisory firm with extensive experience in the automotive industry.
The study estimated direct taxpayer costs of two scenarios—bridge loan and bankruptcy. The bridge-loan scenario involved an outlay of $30 billion, for which the US government received interest payments and gains on warrants, but only half of which was repaid within two years. The analysis found that the losses of employment, income, and tax revenue in a bankruptcy scenario are higher than the losses from company restructuring with the help of federal bridge loans.
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Moody’s Chief Economist Says US Automakers Would Likely Need Up to $125B; Recommends the Requested Government Aid Now
December 05, 2008
In testimony before the US Senate Committee on Banking, Housing and Urban Affairs on 4 December, Mark Zandi, Chief Economist and co-Founder of Moody’s Economy.com, said that under the most likely outlook for the economy and auto industry, the Detroit 3 will need between $75-$125 billion to avoid bankruptcy at some point in the next two years.
The three recently presented restructuring plans by the three automakers totaled up to a possible $34 billion (GM, $12 billion in loans and $6 billion in a line of credit; Ford, $9 billion in a line of credit; Chrysler, $7 billion in loans). Despite the potential quadrupling of that amount, Zandi said that the Federal government should provide the financial help that the automakers need.
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Chrysler Asking for $7B Bridge Loan from Congress; Production of More Than 500,000 Electric-Drive Vehicles by 2013
December 03, 2008
Chrysler is asking Congress for a $7 billion secured working capital bridge loan by 31 December 31, 2008 to support ongoing operations as it continues to restructure its business, according to a summary of the presentation to be made by Chairman and CEO Bob Nardelli on 4 December. Like Ford (earlier post) and GM (earlier post), Chrysler cited the “unprecedented” drop in vehicle sales caused by the financial crisis as the fundamental cause of its financial distress.
Chrysler’s viability plan includes 24 major product launches through 2012, including a wide portfolio of hybrid electric-drive vehicles within several categories: Neighborhood Electric Vehicles (NEV), City Electric Vehicles (CEV), Range-extended Electric Vehicles (ReEV), and full-function battery electric vehicles (BEV).
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GM Requests $12B in Term Loan and $6B Revolving Line of Credit from Congress; Plan Outlines Increased Production of Fuel-Efficient and Alt Energy Vehicles
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| During the four-year plan window, GM will invest approximately $2.9 billion in alternative fuel and advanced propulsion technologies; more than $2B of that goes to hybrid and EREV platforms; 26% of the total ($758M) goes to EREVs alone). Click to enlarge. |
GM is asking Congress for term loans of up to $12 billion to provide adequate liquidity levels through 31 December 2009. In a four-year Restructuring Plan submitted to Congress, GM said it anticipates an initial draw of $4 billion in December 2008, another $4 billion in January 2009, and a third draw of up to $2 billion in the February-March time frame based on recent market developments, for a total draw of $10 billion by the end of the first quarter.
In addition to the bridge loans, the company is requesting a $6 billion line of credit to provide liquidity should a severe market downturn persist. GM’s intent is to begin to repay the loans as soon as 2011. Warrants issued as part of the loans would allow taxpayers to benefit from growth in the company’s share price that might result from successful completion of the plan.
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Ford Asks Congress for $9B Stand-By Line of Credit; Commercial BEV by 2010, BEV Sedan by 2011
December 02, 2008
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| Overview of Ford’s technology sustainability plan. Click to enlarge. |
Ford Motor Company this morning submitted to Congress a business plan detailing a pathway to profitability and requested a “stand-by” line of credit in the amount of up to $9 billion at Government borrowing rates, for a 10-year term, with TARP conditions, in case the current economic crisis worsens or there is a bankruptcy of a major competitor. (TARP is the $700-billion Troubled Assets Relief Program for the financial sector.)
Ford said it will accelerate the transformation of its North American automotive business through aggressive restructuring actions and the introduction of more fuel-efficient vehicles—including a broader range of hybrid-electric vehicles and the introduction of advanced plug-in hybrids and full electric vehicles.
