TCC's Daily Edition: 9/18/01

September 18, 2001

GM HOLDS LINE ON EARNINGS AND PRODUCTION ESTIMATES
Less than a week after Ford announced a significant drop in both its vehicle-production and earnings-per-share estimates for the third quarter of this year, General Motors says that it’s sticking with its predictions. Eighty-three cents per share and a three-month build of 1.22 million vehicles are roughly in line with previous GM estimates for the quarter, which ends on September 30. At the same time, GM President Rick Wagoner said that the outlook for the last three months of the year were "more difficult to predict."
Earnings Watch on at GM, Ford by Joseph Szczesny (8/20/2001)

 

CANADIAN UNION FEARS/FIGHTS LOSS OF BIG 3 FACTORIES
Despite the strength of the U.S. dollar in Canada, the Canadian Auto Workers Union (CAW) feels certain that it is looking at the closure of three plants, one from each of the Big 3 automakers. At issue are General Motors’ Ste. Therese, Quebec facility, DaimlerChrysler’s Windsor, Ontario unit, and Ford’s Oakville factory, also in Ontario. The GM plant builds Chevrolet Camaros and Pontiac Firebirds (both discontinued after next year). The Chrysler line in Windsor, which produces full-size vans, is slated to close in July, 2003. And while Ford’s F-series is the top-selling vehicle in North America, the company’s Oakville, Ontario facility is not on the list of factories building the next-generation full-size pickup. In response to their fears, CAW officials are conducting meetings with Big 3 executives, reporting that the three factories alone account for seven percent of the assembly jobs in Canada.

 

MATERIALS INNOVATION: FIVE-MPH-IMPACT GRILLE
Lacks Enterprises of Southfield, Michigan have given car stylists a little more freedom to do front-end design. This freedom comes thanks to the company's HIPP-140 (High Impact Plated Plastic), a material that can sustain a five-mph impact without suffering any deformation or damage. That means designers can legally integrate the grille placement within the frontal-collision impact zone (and be free of the "big-lip" bumper look, if they so choose). The most visible beneficiary to date of this technology is the 2002 Ford Thunderbird, which uses HIPP-140 for its distinctive grille.
2002 Ford Thunderbird by TCC Team (5/28/2001)

 

TOYOTA INTRODUCES AVALON SPORT LUXURY PACKAGE
In an effort to quicken the pulse of buyers for its Avalon sedan, Toyota Motor Sales has announced a "Sport Luxury Package" for 2002. The package is available on the XL model, and includes 16-inch alloy wheels and a rear-deck spoiler. Inside, the Sport Luxury Avalons get power seats trimmed in leather, a leather-wrapped steering wheel, a JBL audio system and remote keyless entry. Toyota says that the package, available beginning in November, offers "significant savings" over buying the features individually, but the company has yet to announce its price.
Toyota Video Library (7/20/2001)

 

VOLVO OPENS WEST COAST PARTS CENTER
Even likable, safety-minded Swedish niche cars need to grow up sometime, and Volvo Cars North America—part of Ford’s Premier Automotive Group—is doing just that. The company’s increasing popularity stateside has inspired it to open a new 200,000-square-foot parts distribution center in Ontario, California. "Volvo has experienced significant sales growth in the United States," said Thomas Forsman, General Manager, VCNA Operations, "and consistent with our commitment to service, we must assure that when customers buy our product we are able to support them."
Volvo Video Library (7/20/2001)

 

HUGHES SALE STILL UP IN THE AIR
General Motors’ Hughes Electronics division is still on the block. Both EchoStar and Rupert Murdoch’s News Corp. continue to romance GM with big offers—in August, EchoStar put $30.4 billion on the table—and the General doesn’t appear to be in any rush. Both communications companies are dying to get their hands on the more than 10 million subscribers to Hughes’ DirecTV satellite broadcast service.
Echostar Wants Hughes, Too by Joseph Szczesny (8/13/2001)

 

MERCEDES EXPANDING ALABAMA PLANT
Backing up its expansions throughout the world’s sport-utility-vehicle market, Mercedes-Benz broke ground on a $600 million enlargement of its M-Class SUV facility in Alabama. Scheduled for completion in late 2003, the growth will include a 1.8 million square feet of additional assembly space, and paint and body shop facilities. If the expansion is used exclusively as a facility for building Mercedes M-Class sport utes, the company can build as many as 160,000 annually.

 

GM MOVES A STEP CLOSER TO DAEWOO
Reuters reports that General Motors has signed a "memorandum of understanding" to buy portions of Daewoo Motor, South Korea’s bankrupt automaker. Daewoo’s creditors have spent billions over the past two years trying to keep the Number Three Korean automaker afloat while looking for an angel to come in and take over the operations. Back in May, GM and Italy’s Fiat presented a proposal to buy Daewoo, but the talks appear to have been moving slowly with little comment from either side. Other reports say that GM’s unwillingness to take over the company and its aging, debt-ridden facilities lock, stock and barrel, caused some snags in negotiations. On Monday, however, the Joongang Ilbo newspaper said that a sale announcement would be made this week.
GM-Daewoo Deal Fading by Joseph Szczesny (8/27/2001)

 

 

FACTOIDS:
Many New-Car Defects Traced Back To Design

Although automobile manufacturers have made tremendous strides in improving build quality in recent years, data from J.D. Power and Associates' Initial Quality Study indicates that less than 30 percent of problems identified by consumers after 90 days of ownership can be traced back to manufacturing-related causes. A much greater share of initial quality problems, 65 percent, can be traced to the vehicle design stage and approximately five percent are due to dealership sales and service functions. The data clearly points to the need to design quality into new vehicles from the start

FROM THE SOURCE:

From PR Newswire United States Council for Automotive Research researchers are being honored by R & D Magazine as recipients of a 2001 R & D 100 Award for their work on plasma-catalysis engine exhaust treatment . . . Bell & Howell Publishing Services signed a five-year agreement to provide Hyundai Motor America’s dealerships with electronic parts catalog systems, including Internet and CD-ROM based versions . . . TRW Chassis Systems says it has production contracts with two major European vehicle manufacturers for its electro-hydraulic brake-by-wire technology. Additionally, TRW has a development contract with "a leading North American vehicle manufacturer" to develop regenerative braking based on an electro-hydraulic system

THE TICKER:

Autoliv (ALV), Closed 16.57, down 2.83

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ArvinMeritor (ARM), Closed 15.02, down 1.08

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American Axle (AXL), Closed 13.95, down 3.45

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Ballard Power Systems (BLDP), Closed 15.18, down 2.22

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Dana (DCN), Closed 15.39, down 2.85

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DaimlerChrysler (DCX), Closed 33.27, down 6.33

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Donnelly (DON), Closed 15.06, down 0.26

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Delphi Automotive (DPH), Closed 11.50, down 2.55

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Eaton (ETN), Closed 63.95, down 6.00

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Ford (F), Closed 16.55, down 2.85

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General Motors (GM), Closed 44.60, down 6.98

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Gentex (GNTX), Closed 22.66, down 5.34

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Goodyear (GT), Closed 20.52, down 2.40

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Johnson Controls (JCI), Closed 64.33, down 5.72

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Lear (LEA), Closed 27.99, down 5.86

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Magna International (MGA), Closed 49.05, down 6.44

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Nissan (NSANY), Closed 9.69, down 1.81

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Toyota (TM), Closed 54.75, down 5.65

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TRW (TRW), Closed 32.90, down 0.99

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Visteon (VC), Closed 14.13, down 2.02

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