News From the Auto Industry

Now GM is confronting potentially one of the greatest financial challenges arising from its minority investment strategy. In 2000, GM gave Fiat a put, which would force GM to purchase the remaining 80 percent of the Italian auto company in 2004. Why GM management embarked on such a dangerous and potentially expensive course is hard to imagine. Fiat’s been on life support for years and the world’s largest auto company should have known that.

BMW Hydrogen 7 test period concluded - BMW & NASA
The test period which was initiated under a Space Act Agreement between underscores the organizations’ shared commitment to advancing hydrogen technologies and to exploring innovative transportation concepts and alternative energy sources. We are very proud to have been able to offer this test period of the BMW Hydrogen 7 to NASA with whom we share a unique common goal: the use and ongoing research of liquid hydrogen solutions said Karl-Heinz Ziwica Vice President of …

Thu, 09 Aug 2007 00:00:00 EST
To G.M., From Russia With Love
Portfolio.com: Investors, with the exception of Cerberus Capital Management in its acquisition of Chrysler, have not been showing Detroit much love of late. But now a Russian oligarch, Oleg Deripaska, has acquired a stake in General Motors of less than 5 percent, now worth about $900 million, according to …

Porsche Boxster S v.s the Army vs. Mercedes 55 AMG - Cars
Ok this is an alternative car test. Which get fewest bullets wins!

The fuel lines are designed to meet existing LEV II emissions requirements and will contain Algal tubing, TI connectors and multi-layer hose.

Now GM is confronting potentially one of the greatest financial challenges arising from its minority investment strategy. In 2000, GM gave Fiat a put, which would force GM to purchase the remaining 80 percent of the Italian auto company in 2004. Why GM management embarked on such a dangerous and potentially expensive course is hard to imagine. Fiat’s been on life support for years and the world’s largest auto company should have known that.

It hasn’t worked out as planned because there weren’t savings enough from scale economies to offset the investment needed to revive these laggards. GM has controlled Saab since 1990 and still hasn’t found a solution to stem losses. Ford has owned Jaguar since 1999 and has failed to turn it into a consistent moneymaker with products that rival BMW and Mercedes. GM and Ford always underestimated the magnitude of the problems within these companies and overestimated their ability to squeeze savings out of collaboration.

Customer perception of engineering and fit and finish was low. Product cycles were too long. Costs were too high and management seemed unable or unwilling to recognize the eventual competitive threat of the Japanese in the once-protected European markets. We’re hard pressed to identify technology or partnership opportunities attractive enough for GM to give Fiat a put after paying more than $2 billion for 20 percent of the company. In the frothy environment of industry consolidation, GM management must have thought they snagged a prize that would give them more share in Europe. They just didn’t know what kind of prize.

There is only one reason for GM to throw more money at Fiat and, that is to buy back the Fiat put. GM has enough to deal with in terms of coping with another U.S. downturn, a fashion emergency as consumers turn their backs on giant SUVs and passenger pickups and fixing Daewoo to have to pour cash into Fiat. GM doesn’t need Fiat; it never did. GM now needs to find a way to prevent Fiat from forcing it into an ill-advised rescue.

Fiat’s stake was meaningful in Italy because of market share restrictions on the Japanese. Wherever the Japanese were able to compete freely, Fiat’s share was sliding toward zero. Fiat cars weren’t competitive against European Fords, Volkswagens or Opels either.

At the same time, top suppliers stand to gain at the expense of their smaller competitors. Automakers have indicated a desire to work with fewer suppliers and incorporate larger modules and systems into their vehicles, a trend that has benefitted big suppliers.

But it hasn’t hurt, has it Chad?

Nissan beats BMW in battle over “M”
Autoblog: Filed under: Government/Legal , BMW , Infiniti , Nissan Click over and get your Sesame Street fix. You know you want to. A Canadian court just ruled that the letter “M” does not belong to BMW, so it has decided to change its name to “BW.” Just kidding. BMW Canada had sued Nissan Canada in …

randomnessss
expected. maybe cause i using audi songs. imagine if i using anime songs. ahhahaha oh noesssss

Thu, 09 Aug 2007 10:30:10 GMT

Ford said it will cut production in the quarter by 17 percent. The company plans to produce 980,000 vehicles next quarter compares with the 1.176 million made a year ago. First-quarter production will be 1.035 million. Ford said nearly half of the planned production cuts is from not repeating last year’s production increase aimed at boosting inventories. The remainder is the result of moves as part of Ford’s revitalization plan and lower F-series production amid the summer launch of the redesigned F-150 pickup truck, America’s best-selling vehicle.

At the same time, top suppliers stand to gain at the expense of their smaller competitors. Automakers have indicated a desire to work with fewer suppliers and incorporate larger modules and systems into their vehicles, a trend that has benefitted big suppliers.

But it hasn’t hurt, has it Chad?

Now GM is confronting potentially one of the greatest financial challenges arising from its minority investment strategy. In 2000, GM gave Fiat a put, which would force GM to purchase the remaining 80 percent of the Italian auto company in 2004. Why GM management embarked on such a dangerous and potentially expensive course is hard to imagine. Fiat’s been on life support for years and the world’s largest auto company should have known that.

It hasn’t worked out as planned because there weren’t savings enough from scale economies to offset the investment needed to revive these laggards. GM has controlled Saab since 1990 and still hasn’t found a solution to stem losses. Ford has owned Jaguar since 1999 and has failed to turn it into a consistent moneymaker with products that rival BMW and Mercedes. GM and Ford always underestimated the magnitude of the problems within these companies and overestimated their ability to squeeze savings out of collaboration.

Customer perception of engineering and fit and finish was low. Product cycles were too long. Costs were too high and management seemed unable or unwilling to recognize the eventual competitive threat of the Japanese in the once-protected European markets. We’re hard pressed to identify technology or partnership opportunities attractive enough for GM to give Fiat a put after paying more than $2 billion for 20 percent of the company. In the frothy environment of industry consolidation, GM management must have thought they snagged a prize that would give them more share in Europe. They just didn’t know what kind of prize.