FORD EARNS Q2 RECORD $2.5
GM IS FORTUNE 500’S TOP COMPANY
NEW SEAT BELTS STRETCH FOR SAFETY
RANGER, TRACKER CATCH CAIR IN TESTS
MINIS, SUVS TO RULE AUTO PRODUCTION
MITSU MULLING AMERICAN-MADE SUV
GRAND CHEROKEE SLOWS DOWN
GM TO TAKE SAAB?
USED-CAR WEB SITES TO MERGE
NISSAN NEEDS TO TURN 2000 PROFIT
ROUGE WORKERS SETTLE
PROWLER PURPLE, YELLOW NO MORE
FREE SMARTS FOR SWISSAIR
FORD EARNS Q2 RECORD $2.5 BILLION Hot and heavy truck and SUV sales drove Ford to a second-quarter earnings record of $2.48 billion. At $2 a share, the earnings topped even last year’s strong $2.38 billion. Of that amount, Ford’s North American sales contributed the lion’s share of cash, just under $2 billion. Analysts warned that Ford’s sluggish European sales and scattered South American efforts need shoring up.
For more on Ford’s earnings, click here
GM IS FORTUNE 500’S TOP COMPANY For the third year in a row, GM sits atop the Fortune 500 list of the world's largest companies. Right behind the General in second and third places are DaimlerChrysler AG and Ford. The auto industry is riding record sales, which at current rates could top 16.7 million vehicles this year. Rounding out Fortune’s top ten: Wal-Mart Stores Inc., Mitsui, Itochu Corp., Mitsubishi Corp., Exxon Corp., General Electric Co. and Toyota Motor Corp.
For more on GM’s reorganization woes, click here
NEW SEAT BELTS STRETCH FOR SAFETY The next frontier in safety is stretchy seatbelts – or so believes Allied Signal, which will ship its first Securus belts, which are made of stretchier materials than standard fabric belts, the New York Times reports. The Securus system’s belts will allow a person strapped in to move forward about two inches more in a crash, and at a rate where injury from the belt itself is reduced. A spokesman said Allied Signal expects automakers to use the Securus belts first in back-seat applications, where belt rules are less strict. The belts will be available on unnamed 2000 models.
RANGER, TRACKER CATCH AIR IN TESTS Last week’s round of tests by the National Highway Transportation Safety Administration (NHTSA) saw the 1997 Ford Ranger and 1998 Chevrolet Tracker lift two wheels off the ground during tests that studied rollover accidents, the agency reported last week. In two cases, the Ranger may have rolled in an accident if not for special outriggers placed on the vehicle, NHTSA said; the Tracker’s wheel lift was more moderate. "Consumers should not draw conclusions on specific models because test data are not available on most vehicles," NHTSA spokesman Tim Hurd said. The rollover report can be read at www.nhtsa.dot.gov.
MINIS, SUVS TO RULE AUTO PRODUCTION Minicars and sport-utility vehicles will be the fastest-growing car segments through 2004, according to a report from the European Economist Intelligence Unit (EIU). While the EIU predicts vehicle production will increase 12.5 percent worldwide, the minicar class is expected to grow more than 38 percent, and the SUV segment 25 percent (the latter largely based on demand in North America and Europe). The EIU’s candidates for shrinking market segments? Luxury cars and sports cars, which it expects will decline 1.3 and 21.4 percent, respectively.
MITSU MULLING AMERICAN-MADE SUV Will Mitsubishi’s Normal, Ill. Plant begin churning out sport-utility vehicles? That’s the latest speculation from Japan, where Mitsu executive vice president Takashi Sonobe last week said the company would like to raise its annual U.S. sales from about 190,000 to 300,000 in the near future. Such a vehicle would most likely be a hybrid all-activity vehicle based on the Galant platform: the Normal plant currently builds the Galant and the new 2000 Mitsu Eclipse. Earlier this month, Mitsu said it would work with Fiat to develop and sell a new sport-ute beginning in 2001.
GRAND CHEROKEE SLOWS DOWN Meanwhile, on Detroit’s Jefferson Avenue, DaimlerChrysler is slowing the stream of Grand Cherokees from its Jefferson North plant to circumvent a growing supply of the vehicles. DC is cutting production by about 6.7 percent to combat an 81-day supply of the vehicle. Grand Cherokee sales actually rose 9.1 percent in June over last year, but the plant had been running at full capacity. Analysts say increased competition in the segment is forcing the slowdown.
GM TO TAKE SAAB? The Detroit News is reporting that GM is likely to exercise an option to buy the remaining 50 percent of Saab that it doesn’t own already by the end of the year. In 1989, GM acquired half of the Swedish car company for $700 million; its six-month option to purchase the other half begins on August 1, according to the paper. Saab may be a convenient means to boost GM’s luxury sales, and a profitable one: the brand is making a profit this year for the first time since 1995.
USED-CAR WEB SITES TO MERGE Two of the Web’s largest used-car locators are merging. Atlanta-based AutoConnect.com and Norfolk, Va.’s Auto Trader Online will combine this fall to create the new AutoTrader.com site. By combining forces, the two companies say they’ll offer Webheads more than 1.5 million used-car leads from which to choose. Currently, AutoConnect offers some 900,000 of those leads. The new company will be based in Atlanta, headquarters of AutoConnect’s parent company, Cox Communications. The new site will continue to offer free online classifieds for dealers and private sellers; Auto Trader’s independent line of 4x4, boat and RV ads will continue, as will the print version of Auto Trader magazine.
NISSAN NEEDS TO TURN 2000 PROFIT Former Renault exec Carlos Ghosn (pronounced GOAN) is setting some lofty goals for his remake of Japanese carmaker Nissan’s finances. "Nissan will have to come back to profit very quickly,'' Ghosn said last week while on a tour of Nissan’s U.S. operations. "When I say quickly, I'm saying specifically the year 2000. I think the year 1999 is already, unfortunately, in the red." Ghosn became Nissan’s COO July 1, and is setting the stage for a sweeping reorganization of Nissan to be announced at the Tokyo Motor Show this fall. In March, Renault invested some $5.4 billion in Nissan for effective control of the company.
For more on Ghosn’s plans for Nissan,
ROUGE WORKERS SETTLE Two workers injured by the explosion of a boiler at Ford’s Rouge complex have accepted a $1 million settlement and a portion of their salaries paid until age 65, a spokesman for the pair announced. Dennis Arrington, 47, of Detroit, and another unnamed worker accepted the offer from Ford, according to the Detroit Free Press. Six workers died and 14 were seriously injured in the explosion. Ford is also looking at an offer of $30 million to all the families of the workers involved, the paper reported, including donations to education funds for children of the workers and lump-sum settlements.
PROWLER PURPLE, YELLOW NO MORE Stop reading and get to a Plymouth store now if you want a purple or yellow Prowler hot rod: both colors are being retired from the car’s palette with the introduction of another color, silver. Only silver, red, and black Prowlers will be available in the 2000 model year, DaimlerChrysler announced last week. "Silver accentuates Prowler's forms and gives our two-seat roadster a mechanical, yet classic look," said Tom Gale, North American design chief for the German-American automaker. Of the 3,016 Prowlers sold so far, 1,476 are purple; 651 are black; 549 are yellow; and 340 are red.
FREE SMARTS FOR SWISSAIR Flying up front and need a car? Don’t worry, if you’re flying Swissair. The airline announced last week that it would offer its first and business class passengers a free day’s rental of a DaimlerChrysler Smart car upon arrival at certain airports. The airline’s chief executive Jeffrey Katz said Swissair would eventually offer its customers a vehicle from a fleet of 1000 Smarts once the program has reached its peak. The offer begins July 26 at the Zurich airport, and will be managed by Avis.