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Week of June 5, 2000


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SALES DOWN FOR U.S. AUTOMAKERS
LAYOFFS HIT FLAT ROCK
SATURN CUTS WORKFORCE FOR THE FIRST TIME
CIVIC HYBRID
NISSAN INVESTS IN SOUTH AMERICA
TOYOTA TO BUILD CARS IN CHINA
DAEWOO FACES COURT COMPLICATIONS
CHARGED UP IN CALIFORNIA
INDUSTRY AGREES ON SIDE AIRBAG TESTS
WAGONER TAKES OVER AT GM
UNOCAL ROYALTIES: PAY AT THE PUMP

 

SALES DOWN FOR U.S. AUTOMAKERS Analysts estimate that overall sales fell about two percent in May, in the first decline since August 1998. Reasons are varied, but rising interest rates, weak product lines, and possibly rising gas prices are all possible causes for American brands being hit so hard. General Motors posted a 5.9 percent drop in sales, while DaimlerChrysler's Chrysler arm posted an 18 percent drop. Ford, aided by new product introductions, posted a 1.1 percent rise in sales, with strong import brands showing higher sales as well.

For more on the slowdown, click here

 

LAYOFFS HIT FLAT ROCK Ford and Mazda announced plans to lay off 945 workers at the joint-venture AutoAlliance International plant in Flat Rock, Michigan, due to slow sales of the Mercury Cougar. The plant, which currently employs 2834 workers, assembles Mercury Cougar and Mazda 626 models. Ford has said that it will place some of the workers in other plants.

 

SATURN CUTS WORKFORCE FOR THE FIRST TIME Saturn has announced that it will lay off 20 percent of its Wilmington, Delaware workforce. The Delaware plant, which currently has 2459 workers, has been operating at a small fraction of its capacity due to slow sales of Saturn LS models. The announcement marks GM's Saturn division's first layoffs ever.

 

CIVIC HYBRID Honda has revealed that a gasoline-electric hybrid engine system will be available on Civics starting next year. While the new hybrid won't be available in the North American market until 2002, the hybrid announcement follows Honda's announced intention to boost North American car and truck sales by 11.5 percent by 2004.

 

NISSAN INVESTS IN SOUTH AMERICA Nissan Motor Company plans to invest $300 million in expanding production to South American markets by 2005. Besides sharing existing Renault assembly plants in the Mercosur trade-partner countries (Argentina, Brazil, Uruguay, and Paraguay), the company will be able to share Renault's manufacturing, purchasing, and administrative costs. Nissan will first establish Frontier pickup production at a Renault plant in Parana, Brazil, that has been operating far below capacity.

 

TOYOTA TO BUILD CARS IN CHINA Toyota has announced that it will begin producing cars in a joint venture in Tianjin, China in 2002. The joint venture includes Tianjin Automobile Industrial as an equal in the $100 million investment. Up to 10,000 Yaris and Echo models would be produced in the first year, while Toyota hopes to eventually produce 30,000 per year.

DAEWOO FACES COURT COMPLICATIONS Automotive News reports that Daewoo's expansion into the United States has been complicated with several lawsuits. DaimlerChrysler is suing Daewoo for patent infringement, accusing the automaker that the grille on its upcoming Korando sport-utility vehicle too closely resembles that of a Jeep. Daewoo claims that the vehicle will be sold in the U.S. with a different grille. Otherwise, Daewoo is being hit with several cases of systematic racial discrimination by its dealers, and also claims of wage violations and unfair business practices by college student sales people. Daewoo insists that the students were independent contractors paid by commission only.


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