Week of June 6, 1999

June 6, 1999




AUTO SALES SCORCHING IN MAY Auto sales continued a blistering pace last month, with most major manufacturers posting sales gains save GM. At an adjusted rate, May sales would mean an annualized rate of 17 million car sales per year, higher than many analysts' and automakers' expectation. Individually, GM said its light vehicle sales fell 5 percent, with car sales slumping 7.5 percent to 236,929 and pickup trucks, minivans and sport-utility vehicles slipping 2.1 percent to 221,818, for a total of 458,747.  Ford said its light vehicle sales rose 11 percent to 393,833, including Jaguar and Volvo, far above analyst estimates of a slight increase. Excluding the foreign brands, Ford's sales
jumped 7.7 percent. DaimlerChrysler posted a monthly record, rising 6 percent to 264,732 with increases for both cars and trucks. Toyota, Japan's biggest automaker, had its best month ever with sales of 142,625, an increase of 4.7 percent, largely due to a 15.8-percent rise in sport-utility vehicles and minivans, which offset a 1.1 percent drop in car sales. Honda sales reached 98,158, a new May record; and Volkswagen saw a 56 percent sales jump to 29,704, its best May since 1979.


TOP 20 SELLERS The following are the top 20 selling vehicles in the U.S. for 1999 thus far:

RANK VEHICLE 1999 1998 '98 RANK
1. Ford F-Series pickup 368,676 321,673 1
2. Chevrolet Silverado pickup 255,237 244,837 2
3. Toyota Camry 187,953 150,515 7
4. Ford Ranger pickup 177,627 130,204 10
5. Dodge Ram pickup 171,335 160,577 4
6. Ford Explorer 167,192 157,452 5
7. Honda Accord 166,028 162,005 3
8. Ford Taurus 145,701 154,698 6
9. Dodge Caravan 139,509 131,275 9
10. Honda Civic 129,531 138,559 8
11. Chevrolet Cavalier 127,599 125,900 11
12. Ford Escort 121,385 117,382 12
13. Jeep Grand Cherokee 112,931 100,315 15
14. Toyota Corolla 105,040 101,702 14
15. Pontiac Grand Am 99,489 68,303 NA
16. Ford Windstar 97,684 82,322 20
17. Chevrolet S-Series pickup 97,177 111,192 13
18. Saturn+ 93,346 95,403 17
19. Ford Expedition 93,201 78,780 NA
20. Chevrolet Blazer  87,145 91,359 18


DC TO OFFER CHILD-SEAT CHECKS DaimlerChrysler says it will offer a new service at one-fourth of its dealerships: a child-seat clinic which will advise parents on how to install car seats correctly to protect children. DaimlerChrysler is the first automaker to accept a federal agency's challenge in creating the permanent, free service using trained personnel to help customers with the fitting of child seats. The company will spend more than $10 million annually and the service will be available at about 1,000 dealerships, company officials said Wednesday. By next year, DaimlerChrysler says it will have the capacity to conduct 800,000 inspections annually to make sure children are buckled properly in child seats and that child seats are properly installed in both new and older DaimlerChrysler vehicles.



NEW JAG ROADSTER COMING? A slew of automotive magazines and newspapers are reporting that Ford plans to expand the Jaguar lineup to include a sub-$50,000 roadster based on the new S-Type's platform. The roadster would go on sale in 2001, and would compete with other convertibles such as Porsche's Boxster. The S-Type platform, also shared with the Lincoln LS, is already due to spawn one luxury roadster -- the new Thunderbird, due out in 2001. 


BMW TO LEAVE ROLLS AT CREWE? BMW may leave production of its Rolls-Royce luxury vehicles at their Crewe production facility rather than move them after VW takes control of sister brand Bentley, the London Financial Times  reports. Citing an interview with Rolls-Royce Chief Executive Anthony Gott, the paper says that BMW had originally planned to move production to a new plant after they purchased the rights to produce cars under the Rolls nameplate in June. However, BMW's increasing financial pressures, especially from heavy losses at Rover, may lead to a unique solution where VW and BMW both produce vehicles at a single facility. 


LINCOLN STAYS AT HOME Ford will halt its plant to sell Lincolns in Europe, according to new luxury-product guru Wolfgang Reitzle. In an interview with Automotive News, Reitzle said Ford has scrapped plans introduce Lincoln in Europe because it would compete with Volvo's cars, which Ford now owns. Reitzle, Ford group vice president who oversees its luxury brands, says he hopes to increase the company's luxury sales to at least 1 million vehicles annually, competing with DaimlerChrysler and BMW.



HONDA TO MAKE FUEL CELLS Honda Motor Co. says it will spend up to $500 million to introduce a fuel-cell vehicle by 2003, Reuters reports. The company plans to build 300 fuel-cell powered vehicles a year starting in 2003 for sale in Japan and the U.S., said Takeo Fukui, managing director in charge of research and development, which would put it in league with Ford and DaimlerChrysler, both of which have expressed plans to sell fuel-cell-powered cars. Fuel cells use the electric charge generated by combining oxygen and hydrogen for power.


VOLVO MULLING U.S. PLANTS Recent Ford acquisition Volvo is considering making vehicles at U.S. plants operated by Ford, the London Financial Times reports. Last March, Ford acquired the carmaking unit of Volvo AB for $6.45 billion. Volvo has firmly decided not to build vehicles at Mitsubishi's Illinois plant: the companies jointly build vehicles in the Netherlands. By building in the U.S. the company hopes to raise volumes from 500,000 vehicles a year to more than 700,000, the paper reports. 




NISSAN/FORD FLING TO END SOON? Ford and Nissan, which build the Mercury Villager and Nissan Quest together in northern Ohio, may close out their contract earlier than planned, according to wire reports. Ford's plant in Avon Lake, Ohio, churns out both vehicles and is bound by an agreement to build them through 2004. However, with Ford affiliate Mazda now producing its own minivan, chances are that vehicle will replace the Villager in the Ford lineup. For its part, Nissan may turn to new partner Renault to supply it with a version of the popular Espace for sale in the U.S.



GM DESIGNER MIGRATES TO FORD Ford said last week that it has hired away GM designer Larry Erickson, who helped to design hot rods like the Cadzzilla used in music videos by rock group ZZ Top. Erickson, 42, will be assigned to Ford's small and medium car vehicle center design studio in Dunton, England. Erickson previously designed in GM's Chevrolet studio, working on the Malibu and Cavalier programs. He has also been involved in hot rod design and worked on GM's Seville/STS/Eldorado Cadillac programs. 


SAAB RECALLS 9000 Saab has announced a recall of 26,000 cars -- 9000 models built from 1992 through 1994 -- to fix possible corrosion of circuit boards that may make the airbag light turn on.  Saab says moisture can seep into the airbag's electronic control module and corrode printed circuit boards, switching on the ``SRS'' light. The company also said that no accidents or injuries have been reported because of the problem.   To fix the problem dealers will put a protective cover onto the module or the module will be replaced, if needed, free of charge.





SANTA FE BECOMES SANTA FE Hyundai announced Tuesday that its new compact sport-utility vehicle will be called the Santa Fe, the same name used for the concept version of the truck displayed on this year's auto show circuit. The Santa Fe is scheduled to go on sale in North America next spring as a 2001 model, and will compete with other car-based sport-utes such as Toyota's RAV4, Honda's CR-V and the Subaru Forester. Pricing has not been announced, but the Santa Fe is expected to list for under $20,000; a six-cylinder engine will be the first offered in its class. 


NEW DIGS FOR GM ENGINEERS GM said last week that it will build a $100 million, nine-story tower at its Warren, Mich. Technical Center, part of a wider $1.5 billion investment in the Detroit suburb to consolidate its engineering operations, the AP reports. The one-million-square-foot tower will rise out of a small lake on the Warren campus. Construction will begin in August, and employees should begin moving into the tower in late 2001, company officials said. GM is investing more than $1.5 billion to consolidate over 40 engineering facilities and sites in southeast Michigan at the Warren Technical Center.

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