Chevrolet to debut rear-wheel-drive SS next year (AP) Featured
Chevrolet to debut rear-wheel-drive SS next year
AP
May 17, 2012 3:59 PM CDT
DETROIT (AP) - For the first time in nearly two decades, the Chevrolet brand will have a big, rear-wheel-drive sedan in its U.S. lineup.
General Motors Co. said Thursday that the 2014 Chevrolet SS will go on sale in limited numbers late next year. The V8-powered SS is a version of the Holden VF Commodore, a rear-wheel-drive sedan sold in Australia. It will be made in Australia.
The new SS will also be Chevrolet's NASCAR Sprint Cup contender, replacing the Impala. It will debut in its race configuration at the 2013 Daytona 500.
GM issued a photo of a camouflaged SS on a test track, but otherwise released few details.
The SS won't be Chevy's only rear-wheel-drive vehicle. The Chevrolet Camaro is also rear-wheel-drive, but it's a two-door coupe powered by a V6 engine. And the Corvette is a V8-powered rear-wheel-drive sports car, but it doesn't have the space of a four-door sedan.
GM spokesman Monte Doran said enthusiasts have been clamoring for a rear-wheel-drive sedan since GM discontinued the Chevrolet Caprice and Impala SS sedans in 1996. Performance enthusiasts prefer rear-wheel-drive cars because they accelerate faster and handle better.
The timing is awkward for a V8-powered gas guzzler, with gas prices high and fuel economy standards rising. But Doran stressed that the SS won't hurt Chevrolet's overall fuel economy because it will be sold in very small numbers to a core group of enthusiasts.
"This is by no means a mainstream car," he said.
SS is short for Super Sport. The designation has a long history within the Chevrolet brand. It first appeared in 1957 on a Corvette prototype race car, and was first offered as an option on a standard production sedan with the 1961 Impala. The latest SS model in Chevy's lineup is the fifth-generation Camaro, which debuted in 2010.
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Warren Buffett's investment firm buys 10 million shares of GM
Warren Buffett's investment firm buys 10 million shares of GM
Detroit Free Press
By Nathan Bomey
May 16, 2012
Legendary investor Warren Buffett's Berkshire Hathaway disclosed Tuesday that it had acquired 10 million shares of General Motors common stock -- a show of confidence in the automaker that went through bankruptcy just three years ago and is still 32% owned by the federal government.
Berkshire's total investment was $256.6 million. The publicly owned investment firm's stake in GM is the 20th largest of all shareholders, according to Bloomberg. By comparison, the federal government owns more than 500 million shares.
Buffett likes to invest big in companies he sees as undervalued, though the GM buy is on the small side for the investor nicknamed the Oracle of Omaha. It could mean another Berkshire associate approved the trade.
"It confirms the investment thesis that we've had on GM," said Morningstar analyst Richard Hilgert. "We definitely see some value there, just as Mr. Buffett does, and hopefully this will draw a little more attention to the stock from investors."
GM's stock closed down less than 1% Tuesday at $21.42, but rose nearly 4% in after-hours trading. GM shares were priced at $33 during the company's initial public offering in November 2010 after emerging from bankruptcy.
A Berkshire spokeswoman was not available Tuesday. And GM spokesman Jim Cain declined to comment.
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Mission Impossible: Finding a Minivan Made in America by Union Workers
Mission Impossible: Finding a Minivan Made in America by Union Workers
opednews.com
by WALTER BRASCH
May 10, 2012 at 05:17:55
Last year, not one of the 491,687 new minivans sold in the United States was made in America by unionized workers.
Some were manufactured overseas by companies owned by non-American manufacturers. The Kia Sedona, with 24,047 sales, was built in South Korea, Russia, and the Philippines. The MAZDA5, with 19,155 sales, was built in China, Japan, and Taiwan.
Some minivans from Japanese companies were built in the U.S., but by non-unionized workers. Honda sold 107,068 Odysseys built in Alabama. Toyota Siennas, built in Indiana, went to 111,429 persons. The Nissan Quest, built in Ohio, had 12,199 sales.
Only three minivans were built by unionized workers, but they were made in Canada by members of the Canadian Auto Workers. The Dodge Grand Caravan, with 110,996 sales; Chrysler Town & Country, with 94,320 sales; and the VW Routan, with 12,473 sales, all share the same basic body; most differences are cosmetic. GM and Ford no longer produce minivans.
The United Auto Workers (UAW) suggests that members who wish to buy minivans buy one of the three Chrysler products because much of the parts are manufactured in the United States by UAW members.
At one time, all cars, trucks, and vans from GM, Ford, and Chrysler were produced by union workers in the U.S. or Canada. The Dodge Avenger and Chrysler 200 Sedan both have about 80 percent of all parts produced in the U.S. For many cars built in the U.S., the number of parts produced in North America may be only 5075 percent. The Japanese-owned Mitsubishi Eclipse, Spyder, and Galant, and the Mazda6 are produced in the U.S. under UAW contracts; neither company makes minivans. However, the "Big 3" have been building cars in other countries. Ford, which had strong profits the past year, has closed U.S. manufacturing plants, and cut its U.S. workforce by about half in the past five years. Only about 40 percent of its worldwide workforce is now in the U.S. Many of the cars and the F-series pick-up trucks are being built in Mexico. GM is building cars in South Korea and Brazil, with wages nearly comparable to those in the U.S. However, wages are significantly lower for its workers in China, Mexico, India, and Russia. About 300,000 Chryslers and 200,000 Dodge trucks are built in Mexico.
All vehicles produced in the U.S. have the first Vehicle Identification Number (VIN) as a 1, 4, or 5; vehicles produced in Canada have a 2 as the first VIN number.
Founded in 1935, the UAW quickly established a reputation for creating the first cost-of-living allowances (COLAs) and employer-paid health care programs. It helped pioneer pensions, supplementary unemployment benefits, and paid vacations.
It has been at the forefront of social and economic justice issues; Walter Reuther, its legendary president between 1946 and his death in 1970, marched side-by-side with Martin Luther King Jr. and Cesar Chavez, and helped assure that the UAW was one of the first unions to allow minorities into membership and to integrate the workforce. Bob King, its current president, a lawyer, was arrested for civil disobedience, carrying on the tradition of the social conscience that has identified the union and its leadership.
The UAW doesn't mind that corporations make profits; it does care when some of the profit is at the expense of the worker, for without a competent and secure work force, there would be no profit. When the economy failed under the Bush--Cheney administration, and the auto manufacturers were struggling, the UAW recognized it was necessary for the workers to take pay cuts and make other concessions for the companies to survive.
But not all corporations have the social conscience that the UAW and the "Big 3" auto manufacturers developed. For decades, American corporations have learned that to "maximize profits," "improve the bottom line," and "give strength to shareholder stakes" they could downsize their workforce and ship manufacturing throughout the world. Our companies have outsourced almost every form of tech support, as well as credit card assistance, to vendors whose employees speak varying degrees of English, but tell us their names are George, Barry, or Miriam. Clothing, toys, and just about anything bought by Americans could be made overseas by children working in abject conditions; their parents might make a few cents more, and in certain countries would be thrilled to earn less than half the U.S. minimum wage.
Amecans go along with this because they think they are getting their products cheaper. What they don't want to see is the working conditions of those who are employed by companies that are sub-contractors to the mega-conglomerates of American enterprise. These would be the same companies whose executives earn seven and eight-figure salaries and benefits, while millions are unemployed.
But, Americans don't care. After all, we're getting less expensive products, even if what we buy is cheaply made because overseas managers, encouraged by American corporate executives, lower the quality of materials and demand even more work from their employees.
Walk into almost every department store and Big Box store, and it's a struggle to find clothes, house supplies, and entertainment media made in America. If you do find American-made products, they are probably produced in "right-to-work" states that think unionized labor is a Communist-conspiracy to destroy the free enterprise system of the right to make obscene profits at the expense of the working class.
We can wave flags and tell everyone how much more patriotic we are than them, but we still can't buy a minivan made in America by unionized workers--even when the price is lower than that of the non-unionized competition.
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Customs and affordability determine what style of US vehicle sells in China
Customs and affordability determine what style of US vehicle sells in China
May 13, 2012
By China News Center
Alisa Priddle
BEIJING — Automakers are learning that what sells in the U.S., Europe or Japan won’t necessarily sell in China.
China has been the largest auto market since 2009 and continues to grow in importance. To tap this huge pool of potential profits, automakers are already changing vehicles to cater to Chinese tastes.
“As the largest market you have to adapt,” said Joe Hinrichs, Ford’s president of Asia Pacific and Africa. “You can’t ignore it when developing new products.”
Automakers are stretching cars to create bigger backseats for affluent owners, including government officials, who hire a driver and usually ride in the backseat. Certain models are bringing back ashtrays.
Some manufacturers such as General Motors are creating new brands for the less wealthy who are looking for more basic transportation.
The industry sold 18.5 million vehicles in China last year, and the market is expected to grow about 5% annually for the foreseeable future.
It is not just a matter of developing a few regional products. Appealing to China requires understanding culture and history. Buick is alive today because of its popularity in China dating to the early 20th Century. Increasingly, luxury sedans are designed with China as the focal point even though they will be sold around the world.
“The Chinese market will change the product and retail experience,” said Jacob George, China managing director of J.D. Power Asia Pacific in Shanghai.
When German automakers entered the U.S. market they did not pander to regional differences. They initially resisted cupholders. And they unleashed complex technology such as BMW’s iDrive infotainment system before many customers were ready for it, George said.
“Automakers are entering the market with a more open mind to cater to the Chinese,” said George, who joked that the Detroit Three might get traction by offering special cupholders for hot tea.
Audi became a premium sales leader with its first made-for-China sedan in the late 1990s. China is the biggest market now for rival BMW, which used this year’s Beijing auto show to debut a long-wheelbase 3-Series.
Detroit’s automakers are in the game, but their status and strategies differ.
GM is a leader because of the strength of Buick and Chevrolet. Now Cadillac plans to introduce a model in China every year through 2016. That is part of a larger GM plan to introduce 60 products and double capacity in four years. Dealers are approaching 3,500 this year.
To appeal to entry-level buyers in smaller cities, GM’s joint venture SAIC-GM-Wuling launched the China-only Baojun brand last year with basic, affordable and fuel-efficient cars.
Sales of the Baojun 630 could hit 94,000 this year, said Karl Slym, head of the joint venture.
There are 150 Baojun dealers with plans to expand to 260 this year, Slym said, and more versions of the 630 are coming, as well as a hatchback, smaller sedans and SUVs.
GM will continue to design global products but engineered from the outset for modifications such as a long wheelbase for China, said Kevin Wale, head of GM China.
Ford is investing heavily to grow in China.
“We have no plans for an indigenous brand, but continue to study the competition and government policy,” Hinrichs said.
Hinrichs sees room to extend the Ford brand by offering less-expensive versions of subcompact and compact cars. At the higher end, Lincoln is a North American luxury brand that is working to bolster its products in the U.S. So Ford hopes to make its mark in China by offering four utility vehicles as well as cars.
Hinrichs would not say whether one of the 15 new vehicles coming by 2015 includes a long-wheelbase Taurus or stretched Fusion.
“We have products in our portfolio,” he said. “The strategy is to extend our range and offer more value-oriented products.”
Chinese consumers don’t just want more chrome and controls in the rear seat. They also expect the latest technology.
Michael Robinet, managing director of IHS Automotive Consulting, agrees. “The days of building old products in China are numbered,” he said, referring to the days when some automakers would bring tooling to China from models that were discontinued elsewhere.
Ford designer Michael Arbaugh said cars for China need an ashtray and lighter because a high percentage of the population still smokes.
Jeep is well known in China but the Chrysler brand is returning after a three-year hiatus with the flagship 300 sedan and Grand Voyager minivan.
At the Beijing auto show, the Auburn Hills automaker showed a Jeep Wrangler with a lacquered dragon on the underside of the hood and a 300 concept with a fancy interior and bolder grille.
In the past, Chrysler’s international strategy was exporting American-style cars.
“We’re much better at collecting the voice of the customer than in the past,” said Mike Manley, head of Asia-Pacific for Chrysler and Fiat. “We’re being more proactive to the needs of customers in regions.”
Saad Chehab, head of the Chrysler brand, said he wants the 300 to make a statement that the brand has a personality and appeals to the luxury buyer.
“It’s a unique proposition for people who’ve achieved success here,” Chehab said. “There are young millionaires here with limited choices, Audi or BMW, and they want to stand out. They like the image of gritty Detroit.”
These buyers want to drive themselves — a cool factor that makes them more western and different from their fathers or the government bureaucrat, Chehab said.
For example, Chrysler does not have a stretched 300 to appeal to the ride-in-the-back owner — a subject of great debate.
“It’s something I would very much like to do,” Manley said.
It could be done on an assembly line or in a separate facility for low volume, Manley said.
But Chehab said there are no plans to build any Chrysler-brand vehicles in China.
“It’s an import so for us, every car we sell is cherry on the cake,” he said.
Certain Chinese consumers regard imported vehicles without a Chinese partner’s badge as more of a status symbol, Chehab said.
On the Fiat side, the new Viaggio compact sedan that will be built in China starting in June marks the Italian brand’s re-entry to the market.
Designed for the Chinese market, it is longer than its cousin, the Dodge Dart, and has more chrome.
“This is a Chinese-specific cocktail,” said Olivier François, head of the Fiat brand.
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A recovering GM is losing ground at home
A recovering GM is losing ground at home
Yes, it's back from the brink. But that doesn't mean GM isn't facing daunting challenges. Chief among them: shrinking market share in America.
CNN Money
By Doron Levin, contributor
May 11, 2012: 9:55 AM ET
FORTUNE -- General Motors Co.'s share of a strengthening U.S. vehicle market has taken a hit so far in 2012, a sour note in its remarkable recovery story. A refocused GM is facing constraints to its ability to produce vehicles as well as tougher competition from domestic and foreign automakers also on the mend.
Help for GM could arrive soon. Its tony Cadillac division in coming months will benefit from two key new-model introductions: a large XTS sedan designed to compete with models like the Lexus LS460 and Mercedes S-Class as well as a smaller ATS, which will go head to head with models like the BMW 3 Series and Audi A4.
GM's U.S. market share dropped to 17.7% from 19.6% through the first four months of the year. Each point of share represents roughly 140,000 vehicles annually in today's market. Cadillac sales have fallen almost 24% compared with the same period last year.
Sean McAlinden, chief economist for the Center for Automotive Research in Ann Arbor, Michigan attributes GM's lower market share to a cutback on new-model investment during its 2009 bankruptcy restructuring and capacity constraints, including limitations on the number of four-cylinder engines the automaker can build. "It's very complex," he wrote in an email and "not the fault" of top GM management. During the latest economic downturn 32 automotive plants representing more than 3 million units of production closed down in the U.S. and Canada, according to a report this week in Automotive News, a trade publication.
GM, using extensive overtime labor, is operating at full capacity in North America. That means that the company simply can't build many more cars and trucks than it already is. Some plants that were mothballed, such as a factory in Spring Hill, Tennessee, might be brought back into service.
GM is not alone. Ford, also experiencing tight production capacity, has given up 0.8% of a point of share. But Chrysler, 2012's comeback star, has posted a strong two-point bounce in U.S. share on 33% better sales this year. Sales of the Chrysler 200, Chrysler 300 and Jeep Grand Cherokee are soaring, on the strength of powerful marketing campaigns and successful new launches.
The Japanese auto industry, meantime, is recovering rapidly from the effects of last year's earthquake and tsunami. Toyota, in particular, has sold 12% more vehicles in the U.S. this year and is forecasting that its corporate profit will more than double in fiscal 2013 to $9.5 billion. Toyota last year relinquished the title of top seller of vehicles globally to GM.
A more competitive Cadillac should prove a boost to GM's finances since luxury cars are disproportionately profitable. It could also help stanch or reverse the loss of share. GM has attempted to position Cadillac as a worldwide luxury brand, so far with little success. A growing Chinese market may prove more welcoming, especially with a wider ranger of models.
But Europe's economic troubles could mean that BMW, Mercedes, Audi and VW will redouble efforts to sell aggressively in the U.S., where consumers finally are starting to boost automotive spending after several timid years. European brands in the aggregate are up 23% for the year and have gained a point of market share already.
The next few months of the U.S. presidential campaign promise much debate over industrial policy, especially the three-year-old restructuring of Detroit. Facing a tough picture, GM is surely hoping that its results will fuel an argument over which candidates deserve most of the credit, not the blame.
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Dinosaurs farted their way to extinction, British scientists say
Dinosaurs farted their way to extinction, British scientists say
Fox News
May 07, 2012 9:16 AM EDT
Dinosaurs may have farted themselves to extinction, according to a new study from British scientists.
The researchers calculated that the prehistoric beasts pumped out more than 520 million tons (472 million tonnes) of methane a year -- enough to warm the planet and hasten their own eventual demise. Until now, an asteroid strike and volcanic activity around 65 million years ago had seemed the most likely cause of their extinction.
Giant plant-eating sauropods were fingered as the key culprits in the study, which appears in the latest edition of the journal Current Biology. An average argentinosaurus, weighing around 90 tons (82 tonnes) and measuring 140 feet (42m), chomped its way through half a ton (half a tonne) of ferns a day, producing clouds of methane as the food broke down in its gut.
Professor Graeme Ruxton from St. Andrews University in Scotland and co-researcher David Wilkinson, from Liverpool John Moores University, worked out just how much of the greenhouse gas the billions of dinosaurs would have generated during the Mesozoic era, starting 250 million years ago.
"A simple mathematical model suggests that the microbes living in sauropod dinosaurs may have produced enough methane to have an important effect on the Mesozoic climate," Wilkinson said. "In fact, our calculations suggest these dinosaurs may have produced more methane than all the modern sources, natural and human, put together."
The dinosaur output of 520 million tons (472 million tonnes) is comparable to current natural and man-made emissions of the greenhouse gas, which scientists say is around 21 times more powerful than CO2 at trapping heat on Earth and causing climate change. Cows and other farm animals globally contribute up to 100 million tons (90 million tonnes) a year of methane.
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Unions fight to retain role in workplace
Unions fight to retain role in workplace
Kansas City Star
By DALE KASLER
Posted on Fri, May. 04, 2012 03:18 PM
SACRAMENTO, Calif -- SACRAMENTO, Calif. - Pushed to the margins of the U.S. economy, labor unions are engaged in an epic struggle to preserve their members' wages and benefits.
For the most part, they're losing.
Union members across America still enjoy higher pay on average than their nonunion counterparts, but the gap is shrinking. Organized labor is under persistent pressure to make concessions. Diminishing membership also has eroded union power.
The United Auto Workers gave ailing Detroit automakers $1 billion in cuts. Pilots at American Airlines learned last month their pay and benefits could get reduced substantially. Even California's powerful public employee unions have given ground in recent years.
And in the biggest labor battle the Sacramento region has seen in years, Northern California's three union supermarket chains - Raley's, Safeway and Save Mart - are pushing for concessions on health care and other issues, arguing they need to cut labor costs to compete against Wal-Mart and other nonunion stores.
The situation hit the boiling point this week with Raley's. The West Sacramento grocer ended negotiations and vowed to submit its "last, best and final contract offer" to the United Food and Commercial Workers, or UFCW.
Raley's offered to meet under federal mediation. But on Friday, Jacques Loveall of the United Food and Commercial Workers said he'll be scheduling a strike vote in response to Raley's "erratic bargaining position." Loveall also issued a statement through a spokeswoman suggesting the union wouldn't resume negotiations until Raley's agrees to extend the workers' current contract, a step Raley's has balked at taking.
In reality, both sides are vulnerable, and both have reason to fear a confrontation, said Ken Jacobs, chairman of the Center for Labor Research and Education at the University of California-Berkeley.
Raley's is already struggling, and "a strike could be devastating," Jacobs said.
Neither can the union afford "to push Raley's off a cliff" by striking, Jacobs said, since that could ultimately cost workers their jobs.
"It has an impact on how much the union can achieve," Jacobs said.
Few unions are immune to the pressure to accept concessions, particularly in a difficult economy. That's true even for public employees, a remaining stronghold for union membership. More than half of all union members in America are now government workers.
California's public employees, who have considerable influence over Democratic elected officials, have escaped wholesale benefit cuts sought by Republicans. But they have compromised on issues such as overtime pay, employee contributions to pensions and paid holidays. And their ranks have been thinned, especially at the local level, by layoffs.
Concessions have been steeper in the private sector, where competition is fierce, firms are struggling and nonunion alternatives abound.
For instance, the UAW in 2009 suspended dental care, agreed to cutbacks in drug coverage and made other concessions to help keep U.S. automakers from going under. The concessions, totaling $1 billion, were made as part of the federal bailout of the industry.
Even in a growing field such as telecommunications, cost pressures can be relentless. Verizon workers went on strike last summer rather than swallow $1 billion in concessions. They went back to work after two weeks even though the contract remains unsettled.
It becomes hard for unions to protect wages in "industries that have alternatives, where you have companies with lower prices," said David Smith, a labor economist at Pepperdine University. "Markets are just becoming more and more competitive."
Smith said union workers make about 15 percent more, on average, than nonunion counterparts in the same occupations. The gap is considerably higher in some industries, like construction, according to federal data.
In Northern California's union supermarkets, top pay is around $21 an hour plus benefits. The UFCW says Wal-Mart, the leading nonunion chain, pays half as well.
Yet, as the nonunion share of the grocery business has grown, the middle-class status of grocery workers who do belong to unions also has begun to erode. Workers hired after 2004 must work nearly four times as long as veteran employees to reach the top scale. All workers, particularly the new hires, pay considerably higher health care deductibles than before.
The result has been higher turnover, with fewer employees making a career of grocery work, according to a 2007 study co-authored by Jacobs.
"More of the jobs are part time, the workforce is getting younger," the Berkeley expert said. "A smaller percentage of workers have stayed the years you need to get to the higher pay and see it through to retirement."
With the grocery chains pressing for additional cutbacks, the union says it's trying to be sensitive to the companies' financial pressures. The UFCW also has mounted a public-relations campaign to persuade consumers to shop only at union stores.
Getting that message to resonate with the public can be difficult.
Just 11.8 percent of America's workforce belonged to a union in 2001, according to the U.S. Bureau of Labor Statistics, down from 20 percent in 1983.
The slide reflects the nation's changing industrial landscape. Smith said the decline of American manufacturing has robbed the union movement of some of its most reliable workplaces.
Unions have made some gains. The Justice for Janitors movement, launched in the 1980s by the Service Employees International Union, has obtained contracts for thousands of janitors across the country.
The campaign had its big breakthrough in Sacramento in 1999 and now represents 1,200 janitors in the city.
But economic pressures remain: The contract with Sacramento's janitors expired Monday, and employers are pushing to scale back health care coverage, said SEIU spokeswoman Cecille Isidro.
One California union appears comparatively bulletproof: the California Nurses Association. Its members average nearly $90,000 in annual pay. It has the power to disrupt hospital operations by staging one-day strikes, as it did Tuesday at seven Bay Area hospitals operated by Sutter Health.
Smith said it's little wonder the nurses have so much clout.
"It's a highly specialized position," the Pepperdine economist said. "They go into that negotiation from a position of strength."
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Auto Resin Shortage May Strike Europe
Auto Resin Shortage May Strike Europe
Bloomberg
By Craig Trudell
April 20, 2012 12:05 PM EDT
Europe’s auto production will probably be disrupted first if carmakers can’t find alternative resins used to make fuel systems and brake lines, according to a Credit Suisse Group AG report.
Automakers in North America likely are carrying one month of supply more than European competitors of the resin PA-12, Chris Ceraso, a New York-based analyst for Credit Suisse, wrote today in the report. Global capacity to make PA-12, also called Nylon-12, may have been cut by as much as half after the March 31 explosion at chemical maker Evonik Industries AG, he said.
“European users will be the canary in the coal mine for this problem,” Ceraso wrote. Industrial customers there “are much more likely to keep comparatively thinner inventories and don’t have the benefit of large amounts of materials in transit. This means that the most immediate supply disruptions are likely to surface in Europe.”
Automakers led by General Motors Co. (GM), Volkswagen AG (VOW), Toyota Motor Corp. (7203) and Ford Motor Co. (F) and their suppliers are studying ways to find and test alternative materials and avoid losing vehicle output. A combined two to three months of resin inventory may still be “in circulation,” according to Credit Suisse estimates.
Evonik’s Marl, Germany, factory made a base material used in Nylon-12 called Cyclododecatriene or CDT. Evonik supplies CDT to France’s Arkema SA (AKE), and the companies are two of only four global sources of Nylon-12, Ceraso wrote. The others are Switzerland’s Ems-Chemie Holding AG (EMSN) and Japan’s Ube Industries Ltd. (4208)
Europe First
“We expect that the client base impacted most by the lost production will be primarily European-based customers, followed to a slightly lesser extent by North American and South American customers,” Ceraso said.
No automaker has reported canceled or slowed production as a result of the resin shortage. Bayerische Motoren Werke AG (BMW) “can rule out a supply risk at the moment,” Frank Wienstroth, a company spokesman, said today in a telephone interview. “The investigations have not been terminated yet,” he said.
“We are in close contact with our suppliers concerning the current supply of plastic components and precursors,” Sebastian Wahle, a spokesman for Daimler AG (DAI), said in a telephone interview.
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Auto industry releases guidelines for nylon 12 (resin) replacement - PlasticNews.com
Auto industry releases guidelines for nylon 12 (resin) replacement
PlasticsNews.com
By Rhoda Miel | PLASTICS NEWS STAFF
Posted May 2, 2012
DETROIT (May 2, 12:15 p.m. ET) -- Automakers and suppliers have set up a system to test possible replacements for nylon 12, which will speed development of parts using other materials and reduce the potential for auto production slowdowns.
More than 30 companies – representing every link in the resin supply chain as well as automakers – worked with the Automotive Industry Action Group to create interim guidelines that will provide a method to analyze and test other materials in place of nylon 12, AIAG said in a May 1 news release.
The guidelines, formally called the design validation process and report (DVP&R), lay out specific requirements for replacements in areas such as tensile strength and elongation, chemical resistance, fuel exposure and other key performance issues.
Nylon 12 is used in fuel lines, connectors, tubes and other key components, but supplies were running short in the wake of a March 31 fatal fire at Evonik Industries AG’s plant in Marl, Germany, which destroyed the plant making the feedstock cyclododecatriene (CDT). The plant also supplied CDT to other nylon 12 makers.
Molders and resin makers have offered a variety of potential replacements including other nylon materials and acetal and polyphenylene sulfide resins. But without a standard validation and testing system in place, approval of those replacements may have been delayed – which in turn could affect automakers’ assembly plants.
The interim DVP&R approved through the AIAG work group should lower many of those hurdles and reduce the complexity of bringing new resins to the table.
Ford Motor Co. does not expect the nylon 12 shortage to affect its production, thanks to the efforts at AIAG as well as individual suppliers, said spokesman Todd Nissen.
“We don’t expect any disruption,” Ford Chief Financial Officer Bob Shanks said in an April 27 conference call with analysts and the media. “We’re pretty clean. That’s largely due to the fact that we have alternative materials that we can use. There had been some materials the team had previously tested, but didn’t use them at that time, so we had material already on the shelf that we could use.”
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Fairfax - "KC area auto plants gear up for tougher standards" Kansas City Star
KC area auto plants gear up for tougher standards
The Kansas City Star
By STEVE EVERLY
Apr. 30, 2012 10:58 PM
General Motors’ Fairfax plant has had its ups and downs. A few years ago, tougher federal fuel-efficiency standards on the horizon were reason for worry. Detroit automakers, including GM, relied heavily on thirsty but profitable SUVs and struggled to offer popular fuel-efficient cars.
But those concerns were premature, and GM’s plant in Kansas City, Kan., is an example of how things turned out differently.
At the plant last year, GM launched a new model of the Buick LaCrosse, and this year the revamped 2013 Chevrolet Malibu began to roll off the assembly line. The cars’ ride and comfort are a striking contrast to those of the small “econoboxes” that automakers made in the 1970s to boost fuel efficiency.
But the new models are fuel sippers as well. One version of the LaCrosse is rated at 37 miles per gallon on the highway, and the new Malibu Eco is slightly better at 38 miles per gallon. Chevrolet calls it the most fuel-efficient midsize sedan in its 100-year history.
The LaCrosse and Malibu keep Fairfax right in the middle of the automaker’s plans.
“This keeps us in the game going forward,” said Dave Carter, the Fairfax plant manager.
The cars are part of a growing array of fuel-efficient cars and trucks, and of automakers’ efforts to be part of curbing oil imports.
In the past, foreign companies had the upper hand in producing vehicles that saved fuel and sold well. But U.S. companies are players this time around, and local economies such as Kansas City’s are benefiting.
GM’s Fairfax plant provides 3,700 jobs and a payroll, including benefits, of $470 million. It’s not alone in its impact on the local economy. Ford Motor Co. announced last year that it would invest $1.1 billion to expand and upgrade its Claycomo plant, adding more than 1,000 jobs there, and build a new commercial van that will be at least 25 percent more efficient than the van it is replacing.
Ford’s Claycomo plant also makes the F-150 pickup, which is now offered with a more fuel-efficient EcoBoost V6, which is sold in 45 percent of F-150 pickups. The EcoBoost engine is able to replace a V8 in a strategy to offer improved fuel efficiency while boosting the smaller engine’s performance with upgrades such as direct fuel injection.
“That’s the combination we’ve found with EcoBoost,” said Erich Merkle, forecast analyst for Ford.
Ford recently announced that the Transit commercial van to be made at Claycomo also would offer a diesel engine that hasn’t been available in the North American market. Diesel engines deliver more miles per gallon and have been popular in Europe, but they have been slow to catch on here.
Federal fuel-efficiency standards got tougher starting with 2012 models and will become increasingly strict until they reach an average of 35 mpg for automaker fleets in model year 2016 and more than 50 mpg by 2030.
The Natural Resources Defense Council, an environmental group, noted that buyers have twice as many fuel-efficient models to choose from compared with three years ago.
“As consumers look to trade in older cars over time, they will have the latest in fuel-saving technology available to them, putting money back in their pockets,” said Luke Tonachel, the group’s senior vehicles analyst.
The group in a report said that 57 fuel-efficient models were available in showrooms, compared with 27 models in 2009, and that consumers don’t have to buy hybrids or electric cars if they want to save fuel.
“The internal combustion engine is far from dead. It’s just going through a major makeover,” said Alan Baum, a principal with Baum & Associates, which helped with the report. “From pickups to SUVs to minivans to cars, automakers are squeezing more out of vehicles with conventional gasoline engines than ever before.”
Jim Kliesch, research director for the Union of Concerned Scientists, said automakers eventually would have to rely more on alternatives such as electric cars to meet the more stringent fuel standards, but they also deserve credit for boosting the efficiency of the internal combustion engine.
GM has begun to turn around its hybrid strategy, with the LaCrosse and Malibu models offering eAssist — a so-called mild hybrid system that has a relatively modest cost. Its electric power can take over when the engine is idling and at other times can give the gasoline engine a boost.
And EcoBoost, by combining various engine improvements, provides a practical alternative for replacing larger motors even in pickups where V8s have traditionally been favored.
Kliesch said automakers are “doing quite well, and there’s still a lot of opportunity for automakers.”
The push for improved fuel efficiency comes as automakers emerge from some rough financial years. GM filed for bankruptcy protection in 2009 after not making a profit for five years. It was restructured with financial help from the federal government. The company came out of bankruptcy promising to return to profitability, which it did. That required being more competitive and changing the ways it had done business.
The time needed to get new car designs from the drawing board into production has been slashed, and efforts to improve quality have been stepped up. That means Fairfax employees — mainly members of United Auto Workers Local 31 — are often taking on more roles.
The Fairfax plant shows signs of those changes. It’s producing both the 2012 and 2013 Malibu, whereas in the past production of the older model would end while the line was retooled. Such downtime, though, could mean lost sales. So the 2012 Malibu isn’t scheduled to completely end production till November, after the newer model has ramped up.
There are also signs of the world market that GM now competes in.
In a room called the Workplace Development Center, a plant employee is working with a manufacturing engineer from GM’s Chinese operation, which is taking the lead on changes for a future LaCrosse model. They are going over prototype parts to make sure they fit in the car. In the past, this work would have been done in Detroit, but that changed to get plant employees involved earlier, making them more familiar with the product sooner as well.
The first test build at the plant of the 2013 Malibu was done at night to make it easier given the different time zone to be in contact with colleagues in China. And the 2013 Malibu was unveiled this year at the same time in the United States and China.
The 2013 Malibu is a global car to be sold in 100 countries and will be built in four plants around the world, including Fairfax and one other U.S. factory.
The new Malibu for the first time won’t have a V6 engine option. Later this year there will be a newly designed four-cylinder engine and another four-cylinder motor with a turbocharger for extra performance.
The 2013 Malibu Eco now being built, which gets a 38 mpg rating, comes with a four-cylinder engine and the eAssist hybrid technology. Other energy-saving features range from a six-speed transmission to an aluminum hood that reduces weight.
The hybrid technology was tweaked to provide a seamless transition between battery power and the gasoline engines, a problem with past GM hybrids. It is also a simpler design with fewer parts.
“It’s engineered to be easier,” said Pat Saucerman, a plant employee.
GM ordered that six months be shaved off getting the 2013 Malibu into production, so manufacturing issues needed to be identified earlier. One was how best to install the power line from the battery to the engine compartment, because the line needed to run underneath the car.
Damian Smith, a launch manager for the car, said the solution was raising part of the production line so workers could easily work under the car. A wooden mockup, called the Trojan Horse, was built to see whether that would work as hoped, and it did.
“It’s much better than the system we had,” he said.
Problem solved, and the 2013 Malibu is in production.
But to keep ahead, work has already begun on models to be built at the plant over the next few years.
“We call it the perpetual launch,” said Tony Prettejohn, a launch manger at the Fairfax plant.
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As China Car Sales Skid, Beijing Intimidates Foreign Makers Forbes
As China Car Sales Skid, Beijing Intimidates Foreign Makers
Forbes
Gordon G. Chang, Contributor
4/29/2012 @ 7:09PM
Foreign carmakers say Beijing is putting pressure on them to launch dedicated Chinese brands so that they will transfer technology and know-how to local joint venture partners. As Maxime Picat, director general of Peugeot-Citroen’s joint venture in China, said to AFP, “Many of our competitors that have not launched a dedicated brand have had the brakes put on their plans to develop manufacturing.”
The central government’s strong-arm tactics are a clear violation of China’s trade obligations and betray a fundamental weakness of the Chinese economic model. After almost three decades of permitting foreign companies to build vehicles in China with joint venture partners—most of them state enterprises—Chinese car companies are having trouble competing in their own country.
Why? For one thing, domestic brands have not been able to shake their poor reputation for quality. Moreover, foreign companies are offering more attractive cars, dropping prices, introducing cheaper models, and adapting to local tastes. “The first wave of car buyers wants better products and brands as they replace their first cars,” said Jia Xinguang, auto industry analyst, to the official China Daily. “But homegrown brands can’t meet their demands.”
Today, domestic car companies are even losing out to foreign competition in the segment they have traditionally dominated, the low end of the market. At the same time, foreign brands—even the luxury nameplates—are now within reach of China’s households.
The result of these trends is that domestic manufacturers are giving up market share. In the first quarter of this year, sales of domestic passenger cars declined 8.1% while the overall market fell only 1.3%. According to the China Association of Automobile Manufacturers, the market share of domestic brands in the first quarter of this year declined to 42.9%, down 3.2%.
Chinese technocrats believe the solution is to force technology transfers by encouraging the introduction of China-only brands. This tactic could, however, cement the lead of the foreign companies, at least in the short-run. Some foreign manufacturers evidently think so, complying with Beijing’s plan. Market leader General Motors, for instance, was the first car company to give in by starting the Baojun brand last August with Shanghai Automotive Industry Corp., its Chinese partner.
And other makers will follow suit. “We are putting together plans to launch our own brand, in line with what the government requires,” says Peugeot-Citroen’s Picat. Chinese-owned Volvo, at the Beijing auto show, announced it was going to introduce a new brand for the Chinese market.
At the show, which runs through May 2, foreign car companies were enthusiastically showing off new offerings. Of the 120 vehicles making their debut there, 36 were foreign brands. Writes Jack Perkowski in Forbes, “Today, every company wants to bring their latest designs to the world’s largest car market.”
Yes, they do, but not every company in fact will. Take Ford. The company, which introduced three SUVs at the Beijing auto show, has no plans to launch a domestic Chinese nameplate. “We believe that the Ford brand has even more potential to offer value products,” said Vice-President Joe Hinrichs at the gigantic show, referring to the new China-specific brands. Companies with good technology are still reluctant to bring it to a country that has a relentlessly enforced policy of stealing intellectual property from foreigners.
The Ford approach will probably prove to be the correct one. First, analysts say that car companies, by transferring technology, could end up creating competitors for themselves in their home markets. Beijing wants to create globally competitive “national champions” with other nations’ tech.
Second, the Chinese car market looks like it has hit an inflection point. Instead of growing at the projected 9.5% this year, it might actually shrink.
Last year, 14.5 million passenger cars were sold in China, outpacing America’s 12.8 million. In the first quarter of this year, however, the U.S. car market grew by an impressive 19.5% year-on-year, while the Chinese one, as noted, got smaller.
In fact, American car sales are projected to reach 13.9 million this year. If they hit that mark—likely, given the amazing first quarter—China at the end of this year may have to give back the crown of largest auto market to the recovering U.S. Beijing, therefore, has picked just about the worst possible time to use access to its domestic market to intimidate foreign carmakers into launching Chinese brands.
Third, it isn’t entirely clear that a just-for-China brand will have substantially more appeal to Chinese consumers than the already-successful foreign ones. Most notably, at the Beijing auto show Aston Martin unveiled the Dragon 88 China-only edition, just one of the many dragon-themed vehicles at the gigantic exhibition.
Not all potential buyers are impressed with the British company’s attempt to cater to local tastes. “Just because it has a dragon on it, doesn’t mean Chinese people will love it,” said Wang Xizhen, a potential buyer at the auto show. “After all, we’re going after a western brand.”
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