Week of July 17, 2000

July 17, 2000

DC LOOKING AT CHRYSLER BUILDING
LOPEZ WILL FIGHT

DC'S LH CARS TO GO REAR-WHEEL DRIVE
HYUNDAI CONSIDERING NORTH AMERICAN PLANT
NISSAN SELLS SHARES TO JOHNSON CONTROLS
LARGE LOSSES ON MIDSIZE SATURN
LEXUS TOPS DEALER SERVICE STUDY
DC TO SELL HYUNDAI IN MEXICO
DELPHI PLANS MAJOR CUTS
BMW WILL BUILD NEW PLANT

 

DC LOOKING AT CHRYSLER BUILDING DaimlerChrysler is reportedly negotiating to reoccupy a portion of New York's Chrysler Building. The automaker plans to lease about five floors of the building, to be used as a meeting place of the management board, which already meets in New York. Although the move into the Chrysler Building would not affect operations in Auburn Hills, Michigan, or Stuttgart, Germany, it may be a much-needed boost to the company's image to investors.

 

LOPEZ WILL FIGHT According to Automotive News, a Spanish judge has ordered Jose Ignacio Lopez to stay in the country after Lopez claimed that he would fight extradition to the United States. Lopez faces extradition to the U.S. for a federal case involving his use of secret General Motors documents for a new position at Volkswagen. Lopez was fired by VW in 1996, and VW settled with General Motors for $100 million.

 

DC'S LH CARS TO GO REAR-WHEEL DRIVE Ward's Automotive Reports has revealed that DaimlerChrysler is planning to switch all of its large LH Dodge and Chrysler cars to rear-wheel drive in 2004. Although the decision is not yet final, the change to rear-wheel drive would put the cars in a unique marketing position, and it would also enable the company to introduce a production version of the Dodge Charger R/T concept car. DC will continue to build the cars in Bramalea, Ontario.

 

HYUNDAI CONSIDERING NORTH AMERICAN PLANT According to Automotive News International, Hyundai is considering building automotive plants in both Europe and North America. Chairman Chung Mong-Koo revealed the expansion intentions in an interview. Such plants could greatly increase Hyundai's production capacity, image, and market presence. Hyundai recently entered an alliance with DaimlerChrysler, which purchased a 10-percent stake of the company. Hyundai may enter joint ventures with DC in the near future.

 

NISSAN SELLS SHARES TO JOHNSON CONTROLS Japan's Nissan Motor Company is selling its stake parts supplier Ikeda Bussan to Johnson Controls. The $102 million that Nissan will get for its 38-percent share of the company, along with Johnson Controls' assumption of the company's debt, will help Nissan's financial well-being. Nissan, in a "revival plan" effort, is trying to cut costs globally and regain profitability.

 

LARGE LOSSES ON MIDSIZE SATURN According to the Wall Street Journal, General Motors will lose a massive $800 million on the Saturn L-Series this year. General Motors has spent $900 million on development and $116 million on advertising. Sales of the car, made in Wilmington, Delaware, have been far below what the company expected.

 

LEXUS TOPS DEALER SERVICE STUDY Lexus has for the fourth year in a row been given the top rating in the annual J.D. Power and Associates Customer Service Index Study (CSI). Saturn was ranked a close second, much improved from last year's eighth-place rating. The study looks at consumer experiences with dealer service departments in the first three years of vehicle ownership, so high ratings in the survey often correspond to a high ratio of repeat customers. Ranking third through fifth, respectively, are BMW, Daewoo, and Volvo.

 

DC TO SELL HYUNDAI IN MEXICO Korea's Hyundai Motor Company will soon begin selling cars in Mexico under DaimlerChrysler's Dodge brand. Hyundai plans to sell about 35,000 vehicles under the name Dodge Atoz. The recent alliance between DaimlerChrysler and Hyundai enables Hyundai to begin selling vehicles in Mexico. Mexican regulations only permit sales of brands that have production facilities in Mexico.

 

DELPHI PLANS MAJOR CUTS Michigan-based Delphi Automotive Systems plans to restructure its European operations and cut about 900 jobs. Due to changing market conditions, Delphi will cut jobs in the United Kingdom, France, and Poland, and it will also consolidate some of its South American operations. The cuts will save Delphi more than $25 million per year.

 

BMW WILL BUILD NEW PLANT According to Bloomberg News, BMW AG says that it will build an entirely new assembly plant, either in Germany or Eastern Europe, to accommodate for production of its upcoming small car, termed the 2-Series. The company doesn't have enough production space for the car, which will likely go on sale in 2004. Although the company has not yet decided on the location for the new plant, it will bring several thousand jobs. Apparently, Hungary, where production costs are low, looks to be the most likely location for the plant.

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