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Analysis
Plants Becoming Export Base For U.S. Auto Makers
By Dale Buss November 21, 2011On the early-October morning after Ford Motor Co. and the United Auto Workers agreed on a new four-year labor contract, union vice president Jimmy Settles was asked at a press conference how many jobs the company had promised to bring back to Ford’s plants in the United States. He answered the question matter-of-factly: About 5,750 that now are guaranteed to return – and as many as 7,000 additional, previously-announced jobs depending on the sales volumes of the next-generation Ford Fusion and other vehicle models that were involved. What went unobserved was that the promise constituted a remarkable turning point more
Feds Present 2017-25 CAFE, Claim $300 Billion Savings
By Bill Visnic November 16, 2011The U.S. Department of Transportation and the Environmental Protection Agency today announced a formal proposal to adopt corresponding regulations that would set Corporate Average Fuel Economy standards for the 2017-25 period that, by 2025, will have the average vehicle achieving 54.5 miles per gallon in combined city/highway fuel-efficiency. The Obama administration suggested the new standard last year and now the two agencies are presenting the rules as a final proposal to which interested stakeholders will have 60 days to comment. But in July, the administration and 13 automakers broadly agreed to this second phase of CAFE standards already enacted more
Production Discipline Big Three's Stiffest Test
By Dale Buss November 10, 2011The Big Three have turned around their sad-sack product lineups, culled brands, slashed costs and largely restored their relevance to American car buyers, to the U.S. manufacturing economy, and to the culture at large. But in addition to the pesky continuing weakness in consumer confidence and other challenges that confront the whole industry, there remains one huge obstacle particular to General Motors, Ford and Chrysler: overcoming their incentive habit for good. Integral to the vast restructuring of the industry over last three years has been the idea that none of them again would succumb to the temptation to lunge more
Obstacles Remain For Detroit, Including Japan
By Dale Buss November 9, 2011It’s impossible to know whether the Big Three’s recent gains represent a high-water mark or just a notch on a pole that will soon be exceeded by even stronger performance by General Motors, Ford and Chrysler. But one thing is certain: Lately they haven’t seen anything like the obstacles that are going to get in their way over the next few years. The fallout from federal-government bailouts, $4-a-gallon gasoline, and even the continuing economic struggles in so many global markets have only represented an adversity warm-up for Detroit as it attempts to parlay recent victories into a long-term return more
Rising Big Three Look For Sustained Flight
By Dale Buss November 8, 2011After they had brought Ford Motor Co. through the tough recession of the early Eighties, Philip Caldwell and Donald Petersen seemed to almost beg for the next downturn so the CEO and president could demonstrate how thoroughly they’d transformed the company. Just think if Ford’s old dynamic duo were running the automaker today instead of CEO Alan Mulally and Chairman William C. Ford II: They would see the company now occupying a pinnacle that they couldn’t even have imagined 30 years ago. And along with General Motors and to a lesser extent Chrysler, a re-ascendant Ford stands at the more
Edmunds Sees 2012 Car Sales Near 13.5 Million
By Lacey Plache October 26, 2011Edmunds.com expects auto sales in the mid-13 millions next year, building on 2011 momentum and benefiting from a steady release of pent-up demand. Supply will continue to expand as automakers restock their inventories after this year’s shortages. All-new top-selling models will provide extra motivation for buyers to return to market. Loosening credit standards and low interest rates will further facilitate sales. Other buyers will return due to aging vehicles or recession weariness causing an urge to spend. But, the slow pace of the economic recovery will keep sales growth at a moderate pace. Downside risk also remains, given threats more
Four-Cylinder Engines, MPG On The Rise
By Ivan Drury October 17, 2011For consumers, its high fuel prices and slimmer wallets. For automakers, it’s the tug of pending fuel-economy regulations. Combine the two, and the U.S. auto market is undergoing a visible and predictable reconstitution, evidenced by smaller vehicles and smaller engines. A recent examination of data from Edmunds.com shows that over the last four-and-a-half years, the proportion of vehicles sold in the United States with 4-cylinder engines has climbed from 32 percent to more than 45 percent. In several recent months, the U.S. 4-cylinder engine mix has run more than 50 percent of sales, and the smallest engines now are more
Despite Strong September, Economy Slows Car Sales
By Lacey Plache October 12, 2011Consumer confidence, a strong stock market and employment gains bolstered car sales momentum in the first half of 2011, but the current economic environment no longer includes these factors. Instead, several negative factors are contributing to the erosion of new vehicle demand: falling confidence; limited wealth effects; and a floundering labor market recovery. And while buying conditions are improving for consumers, Edmunds.com expects these negative economic factors to remain dominant forces in the months to come. A growing recession risk at home and the European debt crisis pose additional threats to auto sales. Edmunds.com expects auto sales to grow, more
Renewed Supply, Incentives Spur Car Sales
By Lacey Plache October 11, 2011The economy may be floundering but don’t tell that to the auto industry. Supply is up, prices are down, and car sales spiked in September to 13.1 million on a Seasonally Adjusted Annualized Rate (SAAR) basis from 12.1 million in August. A key reason for this upswing is the recovery of Japanese automakers from the March earthquake. Supply is also growing for other automakers that faced high demand in recent months but were unable to immediately respond with increased production. more