Industry News

Ford Expects Global Auto Production to Rise in 2010

Ford expects global auto production to increase 5 to 10 percent this year over 2009 levels, a modest gain that reflects the still weak economy.  "The business environment is challenging but we do expect global growth to continue going forward," Ford Americas President, Mark Fields, said at a recent Credit Suisse Automotive and Transportation Conference in New York. Automakers produced around 60 million vehicles in 2009, down 13 percent from the previous year, according to Ward's AutoInfoBank. World vehicle production peaked at 72 million in 2007. Fields said consumer spending remains below trend in the U.S. and Europe due to weak labor markets and uncertainty about the economic recovery. Asian markets are moderating, he said, but growth in that region remains strong.

One downside to an improved auto market is the rising costs for the commodities used by carmakers like steel, copper, and platinum. Ford expects to see $1 billion in commodity cost increases in 2010. The automaker also said structural costs will rise by $1 billion in 2010 due to increased marketing for the new Ford Focus and Ford Explorer as well as product development. Ford has cut out $10 billion in structural costs since the end of 2005 through plant closures, employee buyouts and layoffs, and other actions. Source: Associated Press

Automotive Sales Up in July

The automotive industry sold just over 1 million units in the month of July which represents an increase of 5.1% from July '09 and a 6.7% improvement over June of this year.

  • The SAAR* for July was 11.4 million, up from 11.1 million in June.
  • Toyota's market share rebounded in July to 16.2% compared to 14.3% in June.
  • Toyota's share through seven months is 15.3%, down 1 point from a year ago.
  • Nissan gained 1.2 points of market share in July with a share of 6.9% (versus 5.7% in June). Nissan's market share through seven months is 7%, up 0.5 points.
  • Hyundai continues its sales surge with a market share of 7.8% year-to-date, up 0.4 points. Volume has increased 20.7% for the year.
  • Ford and Chevrolet brands continue to add to their share gains for the year. Ford's share of 15% is up 1.4 points. Chevrolet's share of 13.9% is up 1.5 points. Volume is up 26.8% and 28.2%, respectively.
  • The large pickup truck segment is 11% of industry sales through July. Volume in this segment has grown by 18.5% compared to 14.8% for the overall industry.
  • The Crossover (CUV) and Large segments had the largest percentage increase through July – up 26.1% and 25.3%, respectively.
  • Through July, the CUV segment was the largest segment in the industry at 24.2%.

* SAAR (Seasonally Adjusted Annual Rate) is a term used in the industry to depict the selling rate of vehicles for a particular month. For example, a SAAR rate of 11.1 million for a particular month indicates that the industry was on pace to sell 11.1 million vehicles on an annual basis.

Auto Dealers Oppose Proposed EPA Fuel Efficiency Grades

The 17,000-member National Automobile Dealers Association opposes a proposal unveiled this week by federal regulators to assign new vehicles a grade of "A+" through "D" on the basis of fuel efficiency.  The group said in a statement that instituting a new grading system proposed by the Environmental Protection Agency and National Highway Traffic Safety Administration to start in 2012 model year would "confuse the buying public, make vehicle purchasing decisions more difficult, or treat certain automakers or fuel types unfairly."  The dealers also worry that the grades could make a difficult transition for buyers who would be comparing used cars without grades and new cars with grades.  Dealers are expected to back a more modest redesign of the current sticker that doesn't have grades during a 60-day public comment period.

The agencies say the 34-year-old stickers are badly in need of updating. Some updates are required by a 2007 energy law that does not include the grades. A fully electric vehicle would get an "A+." A handful of other plug-in or hybrid vehicles would get an "A" or "A-." The median grade would be a "B-" though larger vehicles like SUVs and vans would get worse grades on average than smaller more fuel efficient vehicles. Unlike a similar system used in the United Kingdom, vehicles wouldn't get an "E" or "F" in the U.S. format.  The trade group also expressed concerns that the grades would be too judgmental. The EPA wants public input and will hold a public meeting. People can also email: newlabels@epa.gov with comments.  Source: The Detroit News

OnStar Tests Text-Message Reading Services

OnStar is launching new features with their latest generation of its technology and is testing applications such as reading text messages and updating social networking websites via voice command.  The ninth generation of OnStar's software will let GM car owners use their Smartphones to remotely start the engine and lock or unlock their cars. The service is called OnStar MyLink. Previously, an owner would have to call OnStar for such actions. OnStar is also adding certified emergency advisers to its call centers. The emergency advisers can speak via the OnStar voice system to car-crash victims and offer first-aid guidance.

Two services being testing by OnStar are likely to attract a lot of attention. One would let users dictate status updates to their Facebook page. Another would read text messages from a driver's Smartphone. Such features, if they are launched, are certain to add to the debate over driver distraction. Governments are banning the use of cell phones and texting devices by drivers in a bid to reduce crashes blamed on using the technology while driving. The National Highway Traffic Safety Administration reported that in 2008, 16 percent of fatal crashes involved a distracted driver. Automakers have responded to driver-distraction concerns by adding hands-free technologies. Source: autoweek.com

Truck Dealers Layout State of Industry in White House Meeting

The American Truck Dealers (ATD) led a coalition of trucking industry executives to meet with senior members of the Obama administration and to discuss the state of the industry, the impact of higher costs resulting from new emission mandates, and options to boost medium and heavy-duty truck sales. The meeting laid-out the economic and environmental challenges facing truck purchasers which have resulted in depressed sales of more than 60 percent compared to four years ago. Other stakeholders at the meeting included truck and engine manufacturers, drivers, lease and rental companies, equipment manufacturers, and fleet managers.

“The Obama administration is currently considering additional ways to stimulate the economy and this meeting created a dialogue on how the trucking industry, which employs 7.3 million Americans, can play an important role in the nation’s economic recovery and put people back to work,” said Kyle Treadway, President/CEO of Kenworth Sales Company in Salt Lake City, Utah.  The invitation was extended by the White House after ATD, trade associations, and truck companies sent a letter to President Obama stressing the importance of the trucking industry to the nation’s economy as well as the fallout which has occurred in truck sales and manufacturing over the past year. The trucking coalition urged the administration to consider ways to help stimulate the commercial truck industry, including a proposed temporary 10 percent investment tax credit, or “green voucher,” towards the purchase of any 2010 emissions-certified trucks and other incentives. Source: NADAFrontPage.com