News watch October 2012: today's industry news

Published: 31 October 2012

Welcome to CAR Magazine's news aggregator as we round up the daily stories in the auto industry. Top tip: news summaries are added from the top hour-by-hou

Wednesday 31 October 2012
• It's emerged GM's European 2012 earnings are down nearly half a billion dollars in Europe, where it now expects to lose $1.5bn to $1.8bn before interest and taxes for the full year (DetNews)
• Ford has posted a third-quarter net profit of $1.63bn (£101bn) - almost matching its eventual profit total for the entire year 2011. Despite painful losses in Europe (Ford expects to lose $1bn in Europe alone this year) a resurgent North American market has buoyed Fords sales even higher than previous forecasts (Automotive News Europe)
• Fiat CEO Sergio Marchionne has weighed in against Republican presedential nominee Mitt Romney, who argued that a move towards Chinese production would harm American jobs. Mr Marchionne said in an email obtained by The Detroit News: "I feel obliged to unambiguously restate our position: Jeep production will not be moved from the United States to China." Mr Marchionne went on to say that in fact, Jeep will extent production in the US and create more jobs in the coming years, thanks to the strong US car market. Mitt Romney opposed the $85bn US auto industry bailout of 2009 (DetNews)

Tuesday 30 October 2012
• Audi insists it is still on-track to match its €5.3bn (£4.27bn) profit from 2011 by the end of 2012, despite falling earnings in the third quarter of 2012. Although sales have remained favourable, increased research and development costs have impacted the brand's operating profits, which fell from €1.4bn to €1.3bn in the period. Audi's sales during the period  rose from 320,262 to 364,303 in the third quarter compared with 2011 (Automotive News Europe)

Monday 29 October 2012
• Honda's operating income for the period July - September 2012 jumped 92.1% to £788m. The massive income leap is thanks to a recovering US car market and a resurgent effort off the back of the Japanese earthquake and tsunami (Honda)
• Fiat CEO Sergio Marchionne will revise sales forecasts with a cut of €15bn (£12bn) due to the weak European car market, reports suggest. In 2010, Marchionne defied analysts by predicting Fiat would sell sell 6m cars annually by 2014. Fiat's annual losses this year so far amount to €700m (Automotive News Europe)
• The head of Mitsubishi's independent French dealer network, Jean-Claude Debard, has resigned after describing France's industry minister as a 'retard'. The remarks, in which Mr Debard also branded Arnaud Montebourg as 'a moron' came in response to the French socialist government's increase on environmental taxes, lowering of speed limits, and supposed favouring of French goods. Mitsubishi has submitted its own apology for the incident (Automotive News Europe)

Friday 26 October 2012
• Following the news this week that Ford will close its Belgian Genk factory in 2014, Volvo has now announced it is scaling back manufacture at its Belgian plant in Ghent. 300 employee contracts will not be renewed and hourly production is being reduced from 59 cars an hour to 54 (ANE)
• Production of the new Seat Leon family hatchback has commenced at the company's Martorell facility in Spain. It's the culmination of a £650m investment in the Leon by VW-owned Seat, and guarantees 1600 immediate and 6000 related jobs (Seat)

Thursday 25 October 2012
• Hyundai's profits have been hurt due to industrial action, which caused a drop in production of 82,000 cars in the third quarter. Net profit was £1.2bn during the period, down from £1.4bn won in the previous three months. However, the damaged figures still show a 13% rise over the profit figures posted by the company for the third quarter of 2011 (BBC News)
• Reports suggest Ford plans to close its last remaining vehicle manufacturing plant in the UK, with the loss of around 500 jobs. The Swaythling plant near Southampton, which handles Ford Transit van production, is being cut along with the Belgian Genk plant as Ford undergoes major European restructuring. The loss of the British facility brings to an end 100 years of Ford manufacture in the UK (BBC News)
• VW edges closer to world domination: figures showed VW outsold GM in China in the third quarter of 2012, marking the first time the group has sat top of the tree for Chinese car sales. VW's deliveries in the country jumped 21% (almost triple GM's growth) to 704,991 vehicles during the period (Automotive News Europe)

Wednesday 24 October 2012
• Automotive News Europe reports that the workload from the closed Genk Ford plant (see below) will be  moved to Spain, allowing Valencia to take responsibility for the Galaxy, S-Max and Mondeo. In turn, Valencia's current fare of C-Max and Grand C-Max would switch from Spain to Ford's German facility in Saarlouis (Automotive News Europe)
• Due to major company restructuring brought on by the weak European car market, Ford has announced it is to close the Genk factory in Belgium, costing around 4300 jobs. That acounts for around a quarter of Ford's European workforce: the company also has plants in the UK, Germany and Spain. The Genk plant currently builds the Mondeo and S-Max, but will likely be shut down by the end of 2014 as Ford grapples with mounting losses in Europe, where the company expects to post a $1bn loss in Euopre for 2012 (BBC News)
• Figures from Volkswagen show that the company's third-quarter profits fell by a fifth, due to rising costs and the continually turgid European car market. However, profits still reached a credible €2.34bn (£1.89bn) for the year until September, and VW remained defiant, reaffirming its goals to increase vehicle sales and revenue for the group in 2012 and to match last year's operating profit of a record €11.27bn (£9.11bn) (Automotive News Europe)

Tuesday 23 October 2012
• Yesterday News Watch reported VW and GM/PSA's plans to invest heavily in the emerging Brazilian market, and today BMW has followed suit, with a £212.5m package aimed at creating a large new factory in the south of the country by 2014. With the Brazilian government currently offering tax breaks to companies investing in Brazil, expect more manufacturers to follow suit in getting a stronger financial foothold in the country, as the European market continues to struggle (Automotive News Europe)

Monday 22 October 2012
• Nissan will offer steer-by-wire cars in showrooms by 2013, according to the BBC. The system, which uses electronic signals to command a computerised unit that moves the tyres, rather than hydraulically or electrically assisted mechanical set-ups, will debut on Nissan's Infiniti subbrand. The technology is said to require less effort than a mechanical system, and can also filter out unwanted 'noise' that would otherwise be transmitted through the rack (BBC News)
• GM CEO Dan Akerson has confirmed GM and PSA Peugeot-Citroen are moving closer to an alliance and a joint purchasing agreement. Akerson said it was likely there would be a public announcement by 31 October. The plan itself involves GM and PSA working together to build small cars in Brazil (Automotive News Europe)
• Volkswagen is being careful not be caught napping in the Brazilian market, with a promise to invest $3.4bn (£2.76bn) expanding its factories and model line-up in the country. It's a key aspect of VW's push to become the world's biggest car maker by 2018 (Automotive News Europe)

Wednesday 17 October 2012
• Mercedes has increased its domestic buying incentives to a two-year high due to worrying falls in demand across the rapidly contracting European car market. The manufacturer is offering up to €3000 (£2434) asa trade-in incentive, the highest since 2010. The incentives have so far failed to attract buyers, with an 11% sales decline in the country in September. The drop in Germany, which accounts for 25% of Europe's car market, may pull sales in Europe this year to the lowest level since 1993 (Automotive News Europe)

Tuesday 16 October 2012
• Volkswagen wants a third and fourth SUV in its range to challenge smaller cars like the BMW X1 and Audi Q3, while also bridging the gap between the Tiguan and Touareg. This news comes from a VW spokesman Peter Thul who stressed the need for multiple crossover models in the US market. Smaller crossovers are among the fastest-growing vehicle segments in Europe and North America as consumers seek enhanced fuel economy and greater functionality. Volkswagen is expanding its line-up elsewhere to offset weak demand in Europe as it pursues its goal of becoming the world's largest automaker by 2018 (Automotive News Europe)
• Car sales in Europe suffered their steepest plunge in two years last month, according to Bloomberg. The drop comes despite a strong month for the UK market in the wake of the new '62-plate registration change. Registrations fell by 11% to 1.13m vehicles last month from 1.27m in 2011, Brussels-based industry association ACEA reports. Predictably, it was European mass-market manufacturers Renault and Fiat who suffered most: Renault's European sales fell 29% last month to 78,299 cars, while Fiat saw a drop of 19% to 66,991 sales (Automotive News Europe)
• In a stark reminder of the differing fortunes of manufacturers, Skoda has today reported a 3.3% rise in deliveries for the month of September 2012. From January through September 2012, the brand’s sales increased by 7.9% year on year. In total, Skoda delivered 717,200 cars up to the end of September 2012 (Skoda)

Monday 15 October 2012
• Reports from Reuters and La Tribune sugest that GM may be considering a tie-up with with beleaguered PSA Peugeot-Citroen for its own struggling Opel arm. Automotive News Europe has been told GM could take a 30% stake in the joint venture and inject up to $10bn (£8bn) into the new company. This would reduce GM's financial liability for loss-making Opel, and allow more cost-saving platform-sharing between Opel and PSA (Automotive News Europe)
• Fiat has built its 10 millionth vehicle at a Polish production site, 41 years since the company's first Polish outpost started constructing cars. The plants at Bielsko-Biała and Tychy opened in 1971 and 1975 respectively, and have in that time handled manufacture of 126, the Uno, Cinquecento, Seicento, Panda and the 500 (including Cabrio and Abarth), as well as the Lancia Ypsilon and Ford Ka (Fiat)
• In other Fiat news, sources report that the Italian marque has agreed a deal to build Jeep models in Russia, in a new facility near St. Petersburg. The project had been thrown into doubt after the European market slump caused such a model surplus that the need to create more production in Russia appeared to have ceased. Fiat plans to invest €850m (£626m) in the new Jeep facility, which will be responsible for 120,000 vehicles a year and is expected to start production in 2014. It's in response to a rapidly expansive Russian car market, with vehicles sales expected to rise 7.5% to 2.85 million this year, according to the Moscow-based Association for European Businesses (Automotive News Europe)

Friday 12 October 2012
• In one of the most bizarre stories News Watch has ever reported, it's emerged that Renault drafted three suicide condolence statements after fears that three executives fired after being falsely accused of espionage would kill themselves. The official documents, published by Le Parisien, were drawn up after a flawed internal probe led to the dismissal of three senior employees, all of whom were later cleared by a police investigation. Renault admitted it was hoaxed into sacking development chief Michel Balthazard and executives Matthieu Tenenbaum and Bertrand Rochette, after a company investigation incorrectly concluded they had received payments from Chinese companies keen to steal Renault secrets. Due to the scandal, Renault created draft press releases in which the company expresses sympathy and shock over a hypothetical suicide, with blanks left for the name of the deceased. "The entire company is profoundly shaken by the seriousness of this act," reads one of the draft texts. "Our thoughts are with the family of Mr. XXX." (Automotive News Europe)


Thursday 11 October 2012
• Ever regretted buying a used car after the initial novelty wore thin? Hertz is attempting to put a stop to that through their new 'Rent2Buy' scheme, which allows buyers a ten-day test drive of their prospective vehicle, which is free-of-charge if the car is purchased afterwards. All Hertz 'Rent2Buy' vehicles are fully serviced, with many still under manufacturers’ warranty and from 12,000 to 50,000 miles on the clock.  The test drives are offered at 106  Hertz branches across mainland UK (Hertz)
• Porsche continues to post strong sales in 2012, with a total of 11,888 new cars delivered in 2012. That's a rise of 12.6% versus September 2011, and continues a trend that has seen Porsche sales up by 14.7% for the whole year, with 104,362 vehicles sold so far in 2012. The European market is Porsche's biggest worry: sales for the month actually fell by 5.1% versus last year, but this has been offset by strong growth in China, Russia and the USA, with rises of 31.3%, 90%, and 26.1% respectively (Porsche AG)

Wednesday 10 October 2012
• Toyota has announced a widespread UK recall of Yaris, Auris and RAV4 models after it was discovered that driver's side electric window switches could stick, and if attended to with commercial lubricants, could cause overheating. Despite only one case being recorded in the UK, with no related injuries or accidents, Toyota GB has seen fit to recall 138,000 models manufactured between September 2006 and December 2008 to rectify the issue. The company reports the work will take around one hour to complete at local dealers and will be carried out entirely free of charge. The action comes as part of a wider recall which affects a total of 7.4m cars worldwide - the biggest manufacturer recall since Ford called back 8m vehicles in 1996 (Toyota GB & BBC News)
• Ever wanted firm proof that the mainstream car industry is looking to more exotic materials to cut the weight of their models? It's something we've seen on concepts for years, but rarely in showrooms. Ford is the latest manufacturer to pin its colours to carbonfibre, unveling a carbon Focus bonnet that is 50% lighter than a normal panel. It's not for sale yet though - it's part of a project to understand and research avenues into cost-efficient carbonfibre usage on upcoming models, as Ford targets a 340kg weight reduction in all of its models by the end of the decade (Ford Motor Company)

Tuesday 9 October 2012
• Volkswagen has defied the weak European car market with a new sales record: the first time the brand has delivered over 4 million vehicles in the first three quarters of a calendar year. From January to September, VW handed over 4.21 million vehicles to customers, up 10.6% on 2011. The brand delivered 492,500 vehicles in the month of September, up 4.3% on 2011. (Volkswagen)
• Bolstering VW's strong position is the news that over 15,000 orders have been received for the new mk7 Golf hatchback, since its reveal last month (Volkswagen)
• Despite positive early results that positioned the new 208 as the third best-selling car in Europe in August, reports suggest Peugeot is already cutting back production of the supermini due to low demand and a weak market in Europe. Sources say initial 2012 sales forecasts of 175,000 208s have now been rowed back to 140,000, and that hourly production rates will be cut from 52 to 35 cars (Automotive News Europe)
• Fiat-Chrysler CEO Sergio Marchionne says the company will be forced to revise sales forecasts for the next few years due to the continued European market hardship. Marchionne confirmed forecasts for 2013 and 2014 won't be updated due to the unpredictability of the market. (Automotive News Europe)
• General Motors will create 2000 new jobs in Michigan beginning with up to 1500 at a new information technology innovation centre in the city of Warren. GM hasn't confirmed where the other 500 jobs will be found, but the state says the 'innovation centre' is the first of three projects the company will announce. GM will invest $300m combined for the three projects (DetNews)

Monday 8 October 2012
• Renault has declined to comment on domestic trade union claims that the majority of new Clio models will be built in Turkey, rather than in the native French plants. Desperate to cut costs, Renault has pointed out that it costs €1300 less to build a new Clio in Turkey than in France, but the move will be met with strong opposition should potential work be directed away from French employees. Union reports suggest up to 70% of Clios will be built in Turkey, but a spokesperson for the company said the weighting of the split had not yet been decided (Automotive News Europe)

Friday 5 October 2012
• Toyota reports that 30% of its UK sales are now hybrids, thanks to the choice of nine hybrid models offered across the Toyota/Lexus family. The lower tax bands hybrids fall into have helped towards a 15% rise in fleet sales for Toyota during 2012 (Toyota/SMMT)
• Ford enjoyed strong sales during September, posting a 9.3% rise versus September 2011. The Fiesta supermini was the best-selling car in the UK last month, and is currently the most popular model of 2012 also. (Ford Motor Company)
• Alongside Ford's positive numbers, further sales results published by the Society of Motor Manufacturers and Traders show the effect of the new '62 plate on car sales. The official figures released by the SMMT show that total car sales in September were up 8.2% to 359,612 units, compared with September 2011.  For the year to date (end September) total UK car sales were 1,620,609 – up 4.3% compared with 2011. (SMMT)
• Seat posted its best-ever monthly sales score in September 2012: according to figures from the SMMT, the month saw 7739 Seat cars registered, giving the Spanish company a 2.15% UK market share (SMMT)

Thursday 4 October 2012
• Fiat is to extend the production break at its Pomigliano factory for a further two weeks later in October due to lack of demand and continued poor sales domestically. The Italian plant, which is responsible for production of the Panda supermini, had already been shut down temporarily for two weeks as of 21 September (Automotive News Europe)
• Mercedes is pulling ahead in the race to be number one luxury brand in the US, as its sales last month extended a nine-month lead over close rivals BMW. Mercedes-Benz sales rose 7% in September 2012 in the USA, thanks in no small part to the updated C-class and GLK crossover. In total, Mercedes shifted 23,156 vehicles in the US last month, compared to 21,761 for BMW, who saw a rise of just 0.1% compared with their results for the same month in 2011 (Automotive News Europe)
• Due to the amount of young drivers involved in accidents soon after passing their test, the Association of British Insurers is calling for a change in the law to make people learn to drive for at least a year before gaining their license. The ABI also wants new drivers to face restrictions on driving at night and a lower alcohol limit than older, more experienced license-holders. However, the ABI also supports a move to allow people to start learning six months earlier that the current limit of 17 years of age (BBC News)

Wednesday 3 October 2012
• BMW plans to spin '10 to 12' compact cars from its new front-wheel drive architecture heralded by the CAT concept car at Paris, says Ian Robertson, sales and marketing board member. The UKL platform of the Concept Active Tourer is the firm's first front-wheel drive structure for BMW models, but it'll also underpin the next-gen Mini (Automotive News Europe)
• Petrol sales in the UK have plunged by nearly half a billion litres between April and June, according to the Government. The Department of Energy and Climate Change said sales of fuel dropped 10.6% in the quarter - 'a huge drop', said the AA (BBC News)
• The German government may subsidise sales of electric vehicles after the next election, says chancellor Angela Merkel. She wants to have 1 million emission-free cars on the roads of Germany by 2020 (Automotive News)
• Toyota has seen US sales soar, rising 42% in September 2012. The American new car market enjoyed its best month in more than four years - up 12.8% to 1.19 million cars and light trucks (BBC News
• The Better Place organisation has replaced its CEO Shai Agassi with the head of its Australian unit, Evan Thornley. Agassi founded the company five years ago (Automotive News Europe)

Tuesday 2 October 2012
• Chrysler LLC today reported September 2012 sales rose 12% - it was the company's best September for five years (Chrysler)
• Austria's Magna may lose the contract to build Mini Countrymans for BMW, reports ANE. It says Mini plans to concentrate building cars at its Oxford, UK, plant and the NedCar factory in the Netherlands. Magna International builds the Countryman SUV-lite and will assemble the Paceman in Austria from later this year (Automotive News Europe)
• Goodwood has announced the dates for 2013's Festival of Speed and Revival meeting. Now the provisional F1 calendar has been confirmed for 2013, Lord March has confirmed the FOS will take place from 5-7 July 2013, while the Revival is set for 13-15 September 2013 (Goodwood)
• A spat between the head of VW and Fiat has been resolved, claimed both bosses at a meeting of European trade body ACEA at the Paris motor show. Volkswagen boss Martin Winterkorn told reporters he and Fiat chief Sergio Marchionne had been 'good friends' for years and had 'settled things' (Bloomberg
• PSA Peugeot Citroen will suspend production at its Slovakian factory for 21 days in the fourth quarter to prevent over-production. It builds the 208 and C3 Picasso models at the Trnava plant (Automotive News Europe)
• Carlos Ghosn, CEO of the Renault Nissan alliance, admitted in Paris that Renault could disappear 'in its current form' if the slump in the French new car market continues. Asked if it could collapse, he told RTL radio: 'In its current form, yes. Each company is tied to its home country. I do not know of any company that can be viable, that can prosper from a base that is not competitive. A company needs a natural base; Renault's natural base is France' (Automotive News)
• Meanwhile, Renault-Nissan and Daimler have extended their partnership to include more powertrain joint projects. Daimler will develop a new range of fuel-efficient engines with Renault and license its automatic transmissions to Nissan and Infiniti. The scale of the deal? Production of the four-cylinder engines will top 3 million a year (Automotive News Europe)
• Daimler chief Dieter Zetsche told reporters in Paris that the next-gen Renault Twingo and Smart Fortwo would share identical electric power systems (Bloomberg)
• Honda will build the new Civic Type R hot hatch and the Civic Wagon estate at its UK manufacutring plant in Swindon, the company has confirmed (Honda)