Thursday, October 30, 2008
VW defies the economic slowdown
Volkswagen has resisted the economic slowdown and reported growing three-month profits.
Net profit from July to September rose 28% to 1.2bn euros ($1.6bn; £950m) boosted by sales in emerging markets.
Improved demand in China, Russia and India helped offset slackening sales in Europe and the US.
VW says it continues to believe that its deliveries, sales and profits will exceed last year's levels despite the "difficult environment".
"We are confirming our forecast for 2008, despite the dramatic deterioration in global economic conditions and the automotive industry environment in recent months," said VW's chief financial officer Hans Dieter Poetsch.
The company, which is in the process of being taken over by Porsche, said its diverse range of brands had given it a competitive advantage.
VW owns marques such as Audi, Lamborghini, Bentley, Skoda and Seat.
Its shares have had a bizarre week of trading since Porsche announced on Sunday that it had options to take its ownership of VW up to 74%.
The shortage of available shares left hedge funds scrambling to close their short positions and sent the share price soaring, briefly making it the world's most valuable company by market capitalisation.
Jobs cut as car firm axes shift
Luxury car maker Bentley is cutting up to 300 jobs as it ends its nightshift in Crewe.
Shift workers on the Continental sports car production line are switching to a four day week instead of the current three days.
A spokesman said most jobs will be absorbed but expects between 200 and 300 workers to be left over.
The firm hopes to redeploy some jobs elsewhere in the firm and will be asking for voluntary redundancies. The spokesman said the firm's global sales continue to decline.
Renault shelve Espace plans
Surprise legislative changes across several key European markets have prompted Renault to shelve plans for its next Espace multi-purpose vehicle range.
Due to reach showrooms next year, the new version of the trendsetting MPV, which sold 2,100 units in the UK last year, has been postponed after fresh research findings shunted the business case for the model into 'borderline' territory.
Tax revisions linked to CO2 emissions in France, Britain and Spain dealt the final blow and have put the next-generation Espace back on the drawing board.
"As part of the plans to revitalise Renault, we planned to launch 26 new models before the end of next year. Despite the poor economic situation, investment is in the pipeline for all of our new models except the Espace," said Patrick Pelata, the French company's newly appointed chief operating officer and second in command to chief executive Carlos Ghosn.
"We have been forced to postpone this product because of rapid and unexpected changes in market conditions," he added.
"On paper, our plans for the Espace were fine, but revised anticipated volumes made them borderline. Pressure from taxation linked to exhaust emissions was far more than we had imagined - it's forced us to re-evaluate our ambitions in the upper part of the market."
Pelata said the new tax regime had also prompted a rethink of two other high-end models with retail prices in excess of ?30,000 (£24,000).
"The game has changed since we laid our plans," he added. "We're in a challenging part of the market and have to be innovative."
Lookers in Cost Cutting Review
"Ken Surgenor: "Trading conditions are currently very difficult and the outlook for the industry for the remainder of the year remains challenging.""
Job cuts, closures of marginal satellite dealerships and multi-franchises all form part of Lookers' strategy to ride out the recession.
The top10 AM100 dealer group informed shareholders this morning that it is focused on improving the performance of its franchised dealerships.
However it reassured investors the business is cash generative and has adequate banking facilities for the medium term.
The group suffered a decline in third quarter new car sales similar to the national drop of 19%, said its statement to the London Stock Exchange.
Dual franchising
But its aftersales businesses, which include the parts distributor FPS, have performed strongly, it saidAction being taken to improve the performance of its franchised dealerships include removing the fixed costs of marginal satellite operations and redirecting volume back to main hubs, reviewing dual franchising opportunities where the facilities are larger than the market opportunity, exiting underperforming businesses and reducing the cost base and investment in working capital.
Ken Surgenor, chief executive, said: "Trading conditions are currently very difficult and the outlook for the industry for the remainder of the year remains challenging."
DATED: 30.10.08
FEED: AM
GM and Chrysler merger talks progress
The carmakers have reportedly agreed that GM chief executive Rick Wagoner will head the enlarged company if a merger were to take place. Despite the talks moving forward, funding remains a major obstacle to closing the deal. GM has requested $10bn in US government aid to support the deal, while Cerberus Capital, the owner of Chrysler, is reportedly trying to refinance billions of dollars in Chrysler debt. Should the merger go ahead it would create the world's largest and biggest-selling car company. DATED: 30.10.08 FEED: MT |
General Motors' share price rose more than 8 per cent yesterday to close at $6.76 (£4.07) after news that it had resolved difficulties with Chrysler and merger talks were progressing.Lada to return to UK?
 Lada cars could make a return to the UK on the back of a new range of modern cars still under development, so it will not be any time soon.The Russian cars have not been seen here since 1996 when the Riva saloon, Samara hatchback and Niva 4x4 were phased out - models so old that even the addition of fuel injection a couple of years before that was deemed high tech. The Riva, based on an ancient Fiat, dates back to the factory's beginning in 1966 and, amazingly, is still being made and now called the Lada Classic. The Samara is also still being turned out at the vast AvtoVAZ plant in Togliatti, 1000kms south east of Moscow. The Niva is now made under a joint venture with General Motors in Togliatti and wears a Chevrolet badge. There are also a couple of other more modern cars, the Kalina and the Priora which are made in hatch, saloon and estate form. Earlier this year, however, Renault, with an eye on the fast-growing Russian market, took a 25 per cent stake in AvtoVAZ and is helping the Russians develop new cars. One, the Lada 2116, has been seen as Concept C, but now looks a very different three-box saloon sitting in the company's technical centre. Although it looks ready for production, the reality is still a long way off, waiting for the construction of a new line at the factory to build Renault 1.4- and 1.6-litre engines under licence. This platform, developed by AvtoVAZ, will also carry a 4x4 crossover vehicle which is under development. When will the 2116 go into production? "Not soon enough," says chief operating officer Yann Vincent, a former Renault purchasing chief shipped in to head up the factory business. First up, however, will be an all-new MPV developed off the platform of the Dacia Logan, another affiliate of the French company. AvtoVAZ also has a licence to use this platform and according to the company's new head of design, Brit Anthony Grade, an all new body look has already been signed off. Again, production details await the arrival of the new engines. The AvtoVAZ business is also being overhauled. Company president Boris Aleshin says some non-core business will be sold off and the vast 105,000 workforce trimmed by up to 25,000, many of whom will work for newly formed independent businesses. The company's business portfolio includes vehicle components, plastics moulding and even hotels, construction and recreational facilities. Aleshin said: "Our focus will be on design, development, assembly, sales, service and financial services. We will look to divest some of the other business areas and they will have to seek their own investors or mergers." The factory last year built 683,830 vehicles but has a capacity of more than 1.2 million a year. COO Vincent said his plan is to reach that target by uncorking the bottlenecks in the foundry and stamping plants. He added that any spare production capacity could be soaked up in future by making Renault and Nissan brand models in Togliatti. That seems a long way off at the moment. Vincent added: "The factory is huge and some of the machinery is 40 years old, but it has been incredibly well maintained." While the company awaits the new manufacturing and vehicle technology, the Fiat based cars live on. Aleshin said: "They still sell. They may not have a future, and perhaps by 2011 they will be gone, but in the present market they are in demand and cheap." DATED: 30.10.08 FEED: MT |
Car sales to bounce back in 2009?
 New and used car sales could bounce back in 2009 despite the prospect of a recession.EurotaxGlass's said there were grounds for "cautious optimism" about car sales next year. The analysts predict the used car market will be the first to recover from its current lows and - fleet registrations aside - new car sales will also record a modest upturn. "In the short term, conditions will remain difficult for car dealers, reinforced by the usual seasonal decline in demand that accompanies the latter months of the year," said Adrian Rushmore, managing editor at EurotaxGlass's. "However, we believe the swift and painful downturn we saw in the summer months of 2008 was probably a one-off event. "The arrival of the '09'-plate next March will clearly be an acid test for both new and used sales, and analysis of the current market indicators suggests there are reasons for cautious optimism." DATED: 30.10.08 FEED: MT |
Lookers issues trading warning
 Lookers has warned that current trading in the UK car market is "very difficult" and predicted a challenging end to the year.In an interim management statement the Manchester-based dealer group said weak September sales had hit the industry and it had suffered a 19 per cent fall in new car sales in the third quarter. The company claimed its "diversified business model" had helped it to weather the downturn and its parts distribution and servicing divisions had performed well during the same period. It said it would now focus on areas in which it could improve its franchised car dealerships, including selling underperforming businesses and reviewing dual franchising opportunities. "Trading conditions are currently very difficult and the outlook for the industry for the remainder of the year remains challenging," said Lookers chief executive Ken Surgenor. "However, we have a strong presence in aftersales and a proven management team with huge experience of successfully trading through previous market slowdowns." DATED: 30.10.08 FEED: MT |
Gupta joins Marshall as CEO
Ridgeway’s group managing director Daksh Gupta will become Marshall Motor Group’s next CEO from November 1.
Gupta joined Ridgeway as group managing director in April this year, but will stay as a non-executive director.
David Newman, chairman of Ridgeway Motor Group, gave his blessing to the appointment.
He said: “Daksh has done a fantastic job for us in the time he has been with us. He has helped to re-engineer our business and made us fitter, not only for the current climate but also for the future.
“While we are sad to be losing Daksh full time, he will still be supporting Ridgeway which we are pleased about. He joins Marshall with our blessing, support and best wishes.”
Gupta will continue to work with Ridgeway one day a month to carry on assisting the group on processes, reporting, supplier relationships and business advantage strategies'.
Ridgeway CEO John O’Hanlon will resume full operational control for the group following Gupta’s departure as group managing director.
Robert Marshall, Marshall executive chairman, told AM that he had chosen Gupta for his ‘ambition, not because he will do what I tell him to do’.
Marshall said: “I don’t want a safe pair of hands, I want someone who will kick us into the next stage of motor history. I expect the appointment will raise some eyebrows."
Gupta said: "The company has a strong pedigree and history and to be leading the business into a new era is hugely exciting. Marshall and I are very much aligned with our core values, we understand the importance of relationships which I am committed to maintaining and developing.
“There is no question in my mind that this is one of the best jobs in the retail automotive industry and I look forward to helping Marshall achieve the substantial growth opportunities which clearly exist for this company. In addition, I am also delighted to be continuing my association with Ridgeway as non-executive director.
DATED: 30.10.08
FEED: AM
Hedge funds make £18bn loss on VW
Hedge funds have lost £18bn in two days of trading in Volkswagen (VW) shares that briefly saw the carmaker become the world's most valuable company.
VW shares rose 348% over Monday and Tuesday after it emerged that only about 5% of its shares were available.
Funds that had bet on the shares falling desperately needed to buy the shares to close their positions.
But VW shares fell 37% in trading on Wednesday as Porsche said it would help to solve the hedge funds' problems.
"In order to avoid further market distortions and the resulting consequences for those involved, Porsche SE intends - depending on the state of the market - to settle hedging transactions in the amount of up to 5% of the Volkswagen ordinary shares," Porsche said in a statement.
"This may result in an increase in the liquidity of the Volkswagen ordinary shares."
Controlling stakes
On Sunday, Porsche announced it controlled more than 74% of VW shares.
VW's home state of Lower Saxony owns another 20%.
The panic buying was caused by traders who had short-sold VW shares desperately trying to buy them back so they could close their positions.
Before Porsche's announcement, many traders had been betting on VW's shares falling.
They had borrowed VW shares and sold them in the market, planning to buy them back when the shares had fallen, return them to the lender and pocket the difference.
But what actually happened was that the shares rose as a result of Porsche's effective takeover and the traders found themselves forced to buy the shares at any price.
"Each and any short-seller in the world is trying to close up their position and there is no way they can do it, except for trying to buy like mad," said Heino Ruland, an analyst at FrankfurtFinanz.
What is upsetting the hedge funds is that if between 10% and 15% of VW shares were on loan to be shorted and only just over 5% were available in the market, it is likely that many of the funds that shorted VW had borrowed the shares from Porsche.
It meant that because Porsche had not declared the proportion of VW shares it controlled, traders may have been indirectly and inadvertently borrowing shares from Porsche, selling them to Porsche, buying them back from Porsche and then returning them to Porsche.
None of this is currently outlawed by German authorities, but many commentators have described it as bringing German capital markets into disrepute.
The affair shows reform is needed in the way stock markets operate, according to Chris Day, chief executive of the hedge fund infrastructure providers PCE Investors.
"While there has been much talk that hedge funds should improve their transparency, perhaps the issue should be widened to include stock exchanges to help stop this sort of thing happening," he said.
Bigger than Exxon
VW's shares peaked on Tuesday at 1,005 euros, valuing the company at 296bn euros ($370bn; £237bn), which is well over the $343bn value of Exxon Mobil - previously the world's most valuable company.
Last Friday, VW's shares closed below 200 euros.
As an indication of how extreme the market valuation is, last year Exxon made profits of $41bn on sales of $390bn while Volkswagen managed profits of about $8bn on sales of $136bn.
Honda cuts production at UK plant
Car production is to be cut at Honda's Swindon plant due to the economic downturn. The Japanese car giant said annual manufacturing at the factory would be reduced by a further 10,000 units at the beginning of next year.
This is over and above the 22,000-vehicle reduction announced at the end of the summer and is equivalent to 11 non-production days at Swindon where Honda makes the Civic model as well as the CR-V 4x4.
However, the company said that there would be no job cuts as a result of the reduction which will be carried out between January and March 2009.
Also, Honda still intends to start production of its Jazz model at Swindon in autumn 2009 as planned.
Announcing the cut-back, Honda blamed the world economic conditions and a lack of consumer confidence for its decision to slash production. The manufacturer is the latest in a line of companies to announce production cuts.
Roger Maddison, national officer of Unite, said: "Honda is suffering the same as everybody else in the car business but they are not making lay offs, which is to be commended. Instead, they are holding on to skills and people for the time when the market turns up. We urge others in the sector to follow suit and take the same long term view."
GM may delay new models to cut costs
General Motors may delay or cancel several new models as part of an increasingly urgent drive to control costs.
The cash-strapped carmaker said: "We're evaluating all our product programmes. Things are changing and evolving every day."
The product review has sent shockwaves thought the global automotive parts industry, which could also be hit by the prospect of car company consolidation as demand for new cars continues to fall worldwide.
Wednesday, October 29, 2008
Sharp fall in profits for Honda
Honda Motor has reported a 41% drop in three-month profits, hit by falling sales and the strengthening yen.
Net profit came in at 123bn yen ($1.3bn; £829m) for the three months from July to September.
Japan's second-biggest carmaker has cut its profit forecast for the full year to 485bn yen, down 19% on last year.
Honda is considered one of the better-placed carmakers to deal with the global downturn, thanks to its line-up of smaller, more fuel-efficient models.
But it is vulnerable to the strong yen, estimating that a fall of one yen in the dollar exchange rate cuts about 20bn yen from its operating profit.
The dollar has fallen by about 16% against the yen since the start of the year.
The strong yen makes Honda's vehicles more expensive in the US, where its customers are already struggling with the economic downturn.
Honda has predicted that its US sales in October will be more than 20% below the level for the same month last year.
Its executive vice president Koichi Kondo said the fall in sales was not just across its light trucks and SUVs, which have been struggling as a result of higher petrol prices.
"Now passenger cars have started to fall too, and that seems to suggest that the desire to consume is being hurt by the credit crisis," he told a news conference.
Credit crunch may drive Ford to sell Volvo
Ford may sell Swedish carmaker Volvo to BMW as part of a drive to save cash, according to senior car industry resources.
The Sunday Times has reported that sources close to Ford and BMW say that the two manufacturers have held preliminary talks, although that has been denied by the companies.
Nissan hit by Watchdog’s exploding Navara claims
 Nissan has been stung by claims on the BBC's Watchdog programme that its Navara pick-up suffers from a fault that causes the engine to explode.Several owners of the D22 variant, which was built before August 2006, complained to the consumer affairs show about the problem after their engine blew up whilst they were behind the wheel. Following tests by the BBC, a problem with the con-rods and the bearing that propel the drive shaft were discovered. It is thought up to 16,000 vehicles may be affected. Nissan insists the problem is not a safety issue but a durability one, although it did extend the warranty on the Navara from three years to five in May after receiving hundreds of complaints about the problem. But when Watchdog phoned ten Nissan dealers around the country and told them they had an engine failure on a four-year-old Nissan D22, six out of the ten said they had not heard about an extended warranty. In a statement to the BBC Nissan said: "Nissan has openly stated for some time that the durability of a small number of D22 pickup engines, produced before August 2006, have not performed to our exacting standards. "As a result, Nissan launched a five-year 93,000 miles extended warranty in May to formalise the support we were already providing to our customers." Following the programme the carmaker has also now written to D22 customers affected by the fault. Concerned owners should either email Nissan atcustomer.support_d22@nissan.co.uk or call the company on 01923 899 334. DATED: 29.10.08 FEED: MT |
Car buyers use the internet now more than ever
 Car buyers across the globe are using the internet more than ever before when it comes to researching a vehicle purchase.Capgemini's annual research report - Cars Online 08/09 ¬- analysed consumer vehicle buying patterns in both emerging and mature markets in eight countries across the world. "Manufacturers and dealers cannot afford to ignore the opportunities for growth presented by the internet as a direct sales channel," said Nick Gill, head of automotive at Capgemini. The report also found that car buyers in India and Russia, alongside buyers in the mature western markets, were most likely to use the internet when researching a car. DATED: 29.10.08 FEED: MT |
Monday, October 27, 2008
Porsche moves closer to full VW control
Porsche has announced that it has increased its stake in Volkswagen Group to nearly 75%, an amount which will allow the sportscar maker to gain full control of VW’s cash flow.
The German state of Lower Saxony still owns 20% of the company which, alongside Porsche’s increased holding, means that only around 5% of VW shares are still in ‘free float’.
Under German law, taking a 75% stake will allow Porsche to impose a ‘domination agreement’, allowing it to put Volkswagen’s assets and revenues onto its balance sheets. Porsche has stated that it intends to reach this figure next year.
Porsche said: “We made the announcement after it became clear the disclosure should give so called short sellers – meaning financial institutions which have betted or are still betting on a falling share price in Volkswagen – the opportunity to settle their relevant positions without rush and without facing major risks.”
DATED: 27.10.08
FEED: AM
Marshall Group stays local
"Better, not bigger, as family business puts customers’ needs at top of its priorities."
Three years ago Marshall Motor Group chief executive Roger Knight told AM about his plans to expand the regional group further afield. “We will go anywhere in the UK with the right franchise – that’s a new position for us,” he said. That move didn’t happen.
Although the company expanded, it stayed firmly rooted in the east of England. With Knight now retired, Robert Marshall, great grandson of Marshall founder David and son of current chairman Michael, has no plans to fulfil Knight’s aspirations.
“When I came into the business two years ago we had undergone a period of acquisition and we needed to implement a better regional structure,” Marshall says.
“We decided on the mantra ‘get better, not bigger’, which is all about margins and process, not expanding.”
His focus is on a back to basics strategy with the company recognising and celebrating its strengths as an owner-driver business that aims to satisfy customers in its five core market areas – Cambridge, Peterborough, Suffolk, Herts/Beds (through the Lisles acquisition last year) and east Midlands (via TMS). Building the brand is a key element.
He won’t reveal details of his successor yet, other than to say the person has been chosen for their ambition.
“I want someone who will kick us into the next stage of motor history. I expect the appointment will raise some eyebrows.”
DATED: 27.10.08
FEED: AM
Car parts firm announces closures
An automotive firm has announced it is cutting staff and shutting down plants across its global operations.
GKN has 2,500 automotive staff in the UK with headquarters in Worcestershire and two plants in Birmingham and another in Telford, Shropshire.
It is not yet clear how many of the automotive workforce will be affected.
The firm has said it is taking action to stop a predicted pre-tax profits plunge. Its 2,500 strong UK aerospace division is thought to be unaffected.
'Difficult period'
A spokesman for GKN said: "We are now finalising plans to reposition our businesses to deliver acceptable profitability and cash generation through this difficult period."
He added car and light vehicle sales had dropped across the world, hitting its production schedules.
GMB Union spokesman Keith Hodgkinson said the union had been aware for some time of the firm's precarious situation.
"We have in place an agreement with the company that members who wish to opt to leave the company via voluntary redundancy are free to do so and over the last few quarters over 100 workers have taken up this option," he said.
The union was seeking further information from the company, he added.
The company employs 42,000 people worldwide.
Britain leads green motoring revolution
New initiatives to put Britain at the forefront of a green motoring revolution by encouraging a mass market in electric and hybrid cars have been announced today.
With the potential to create up to 10,000 new British jobs and help preserve many thousands more; this comes as part of wider Government plans to make the most of the low carbon economy, with estimates that around a million green jobs could be generated by 2030.
Fulfilling Gordon Brown's pledge this summer to speed up the delivery of low carbon and electric vehicles for ordinary motorists, experts from across the globe are gathered in Whitehall today to examine how to turn this into a reality.
Speaking at this International Experts Meeting, Transport Secretary Geoff Hoon set out the next steps across Government to deliver a £100 million commitment to accelerate the emergence of the greener vehicles of tomorrow. As part of this 100 electric cars will be provided in UK towns and cities to allow families and other motorists the opportunity to feedback the practical steps needed to make greener motoring an everyday reality.
He said: "Electric cars and other low carbon vehicles, like plug-in hybrids, cut fuel costs and reduce harmful emissions. If we can inspire more people to use them, it will help us to make a positive impact on climate change.
"Alongside this, their research and manufacture is an emerging industry with the potential to create new jobs and safeguard existing employment in the UK. Therefore exploring how to ensure they are a practical and affordable everyday option makes sense all round. That is what the cross Government package of measures announced today will do."
Motor manufacturers will be invited to bid for the opportunity to participate in a £10 million project to run electric car and ultra low carbon vehicle demonstration projects, overseen by the Technology Strategy Board. This will see around 100 electric cars provided to allow families and other motorists the opportunity to feedback the practical steps needed to make greener motoring an everyday reality.
At the same time, up to £20m has been dedicated to UK research into improving technology that could make electric and other green cars more practical and affordable.
This follows the publication of important new research which concludes that, correctly managed, the UK power system could support widespread use of electric cars and their charging needs without requiring large numbers of new power stations.
Secretary of State for Business, Lord Mandelson, said:
"Investment in greener motoring forms part of our plan to put the UK at the forefront of the new low carbon revolution. We know our automotive sector has a global reputation for taking forward new technology and we want the UK to be at the heart of new developments in electric vehicles.
"In the recent Manufacturing Strategy we made clear our determination to support the next generation of low carbon cars and today we are delivering on our promises. Work will continue next year when we produce our low carbon industrial strategy."
Lord Drayson, Minister of State for Science and Innovation, added:
"The technologies for low carbon vehicles are developing fast, whether for all-electric, hybrid or alternative fuels. The challenge for the UK is to ensure industry takes full advantage of this shift and explores opportunities now, to position itself as a world leader in low carbon vehicle technology in the long term.
"To do this, the Government-funded Technology Strategy Board is providing further investment of up to £30m to support industry R&D and demonstrations of electric and other low carbon vehicles. This investment will accelerate the development of these vehicles and bring benefits to UK businesses and, ultimately, help to meet the UK's emissions targets."
The Government has already committed to removing the barriers that could slow a changeover to greener motoring. This includes a commitment to facilitate the roll-out of charging infrastructure through the planning system and to collaborating with other countries to develop international standards and consider how best to encourage the right consumer market to promote electric and other low carbon vehicles.
Work also continues with energy companies and the National Grid to assess the impact on the electricity system of the widespread use of electric drive vehicles.
To encourage the mass production of green vans for the first time, the Department for Transport also announced today that 10 companies have been shortlisted to bid to provide electric and low carbon vans to some councils and other public sector bodies, like the Royal Mail, as part of a £20m programme to ensure all road transport emissions are reduced. Liverpool, Newcastle, Gateshead, Coventry, Glasgow and Leeds will be among the first councils to trial green vans on their streets.
The 10 companies are: Ford; Mercedes Benz; Citroen; Ashwoods; Land Rover, Modec; Smiths; Electric Vehicles; LDV; Nissan and Allied Vehicles. A list of the public sector bodies are provided in the notes to editors. Transport Secretary Geoff Hoon added:
"Vans make up around 15% of road transport emissions in the UK, and their emissions are rising more than any other mode of road transport.
"That's why we are committed to this new programme to help kick-start the market. In the public sector there is considerable demand for vans so we want to use our spending power to lead the way in developing lower carbon options that will appeal across the board.
Mini sales soar in United States
Sales in the United States of the UK-produced Mini have soared ahead of those in Britain for the first time.
A 27% rise in US sales in the year to September led to 40,694 Minis being sold. Over the same period in Britain, some 35,496 Minis were sold. The soaring price of petrol has fuelled the car's American success.
About 80% of the 240,000 Minis produced annually at the company's plant in Oxford are exported.
Porsche raises Volkswagen stake
Porsche has increased its stake in Volkswagen, saying it hopes to have a majority holding in Europe's biggest carmaker by the end of the year.
Porsche revealed its stake had risen to 42.6% - saying it had chosen to make the announcement because of uncertainty in the car market.
It had previously already been been the largest shareholder, holding about 35%.
Porsche has said it did not want to merge with VW - but create an alliance that could take on competition.
It has also argued that it needs a strong influence at VW, which makes components for a third of Porsche cars.
The car industry, which is often seen as a barometer of the world economy, is entering a deep recession, with sales and profits tumbling.
Manufacturing plants are closing, production is being cut back, jobs are being axed and car company share prices are tumbling as a consequence.
United plans
Last week Porsche said disagreements between family members in the company had been resolved.
Two cousins, Wolfgang Porsche and Ferdinand Piech, have held conflicting opinions on how to take over VW.
Mr Piech - who is both the Porsche boss and head of the VW supervisory board - has backed unions who object to the takeover of their company.
But Mr Porsche said that the families were "united" on plans including the idea of co-management of both companies.
The so-called "VW Law" - which essentially gives German authorities the right to veto strategic decisions Volkswagen - will also be scrapped.
Chrysler puts a hold on car dealer recruitment
September sales were dramatically down for Chrysler, falling 69 per cent with just 467 sales, while Jeep tumbled 61 per cent to 660 units. Year-to-date sales for both brands were down by around 30 per cent. During the month the fledgling Dodge brand actually outsold Chrysler with 598 registrations. Federico Goretti, who was appointed managing director in August, said his main priority is to get his 71-strong network back on track after an unsettling period which saw him become the third boss in under 12 months. "Dealer recruitment is on the back burner. To achieve profitability you need to grow average throughput rather than grow the network," he said. He has already hosted a dealer conference and met with a number of retailers to try and re-energise the UK operation. "We have some good sized dealers and need to increase their average throughput. We need to get closer to an average of 400 sales per site; we're currently on about 200," he said. "It's important for our dealers to look at their cost structure and rationalise whatever they can. Their fixed costs are around 7 per cent; if they could get that down to 6.5 per cent that would help," he said. He also confirmed the brand has no interest in opening its own sites. "Carmakers should not get involved in retailing. We need to concentrate on developing new cars and technologies and retailing should be left to the professionals," he said. "There is some nervousness as there has been a lack of continuity and these changes have not been positive. "I'm optimistic but the next 12-18 months will be tough especially when you consider global events. My approach to dealers is to understand their problems and assure them that I'm rolling up my sleeves and working hard," he said. DATED: 27.10.08 FEED: MT |
Chrysler's new UK boss has put a hold on dealer recruitment as the brand moves to turnaround a business battered by falling sales.Porsche aiming for 75% Volkswagen stake
The luxury carmaker said it currently holds a 42.6 per cent - up from around 35 per cent due to recent purchases - and reiterated its plan to to gain a direct equity stake of more than 50 per cent by December. Porsche said it has once again outlined its plans due to the volatility of the global markets and the announcement has come at a particularly interesting time for VW. Its stock has shot up in recent trading, making the world's third largest carmaker worth more than all the other US and European carmakers combined. Porsche's gradual acquisition of the brand has not been easy amid resistance within the company's workforce and the opposition of the state of Lower Saxony, that German state that holds a blocking minority in VW. DATED: 27.10.08 FEED: MT |
Porsche yesterday announced plans to raise its stake in Volkswagen to 75 per cent in 2009.Hyundai records massive profits drop
Falling demand, rising overseas warranty costs and strikes have all hurt the South Korean carmaker's business. Despite this drop and gloomy predictions for the industry as a whole, Hyundai's results were better than anticipated. The carmaker's shares were up 1.2 per cent on Friday, a drop significantly less significant than that of the wider market, which fell 7.5 per cent on the same day. Where its Japanese rivals have been hurt by the rising Yen, the South Korean Won's drop against the dollar has helped Hyundai improve its price competitiveness abroad. Despite shrinking demand in the US Hyundai managed to maintain a 3 per cent market share. The company's focus on fuel-efficient compact cars has also helped it compete against other manufacturers. DATED: 27.10.08 FEED: MT |
Hyundai has reported a 38 per cent drop in quarterly profits.Chrysler reports massive quarterly losses
As a consequence Daimler, which has a 20 per cent stake in the American carmaker, has reported a charge of €351m in its third quarter, blaming Chrysler's second quarter struggles. Chrysler said €76m of the charge was within its automotive business. The other losses were reportedly due to adjustments, such as the reconciliation between US and international accounting standards. The beleaguered carmaker remains in talks with fellow American manufacturer General Motors regarding a possible merger. DATED: 27.10.08 FEED: MT |
