TODAY’S TOP STORIES
FORD CUTS DIVIDEND TO 15 CENTS
As reported here yesterday, Ford has announced that it will cut its stock dividend to 15 cents for the fourth quarter, a 50-percent drop from its third-quarter 2001 dividend of 30 cents a share. "The dividend reduction is a difficult but necessary action," said Jacques Nasser, president and CEO. "A number of factors have converged in the last six months to dramatically impact our company and our operating results. The tragic events of Sept. 11 have compounded those difficulties by weakening consumer confidence in an already weak global economy. Recognizing there are challenging days ahead, we are taking aggressive actions to address the issues that face our company."
CHRYSLER MAY RETOOL RESTRUCTURING
The Chrysler Group’s restructuring plan may have to be revisited following the Sept. 11 attacks, says group president Dieter Zetsche. The AP reports that Zetsche told reporters gathered at a Detroit-area dealership that “It's wise to assume the market next year will be smaller than we thought six weeks ago.'' As recently as September, Zetsche had told the press that Chrysler’s plan to return to solvency was on track, after 26,000 job cuts and production slowdowns. Zetsche added that recent showroom traffic has been strong, but that the company would not have a clearer idea if further cuts would be needed until its third-quarter results were announced at the end of the month.
Sept. Sales Slump, Recover by Joseph Szczesny (10/8/2001)
VUE FROM THE STICKER: $16,835
Saturn’s first sport-utility vehicle, enduring its short-lead press drives this week, will be priced starting at $16,835, the company said in a press release on Wednesday. Base models offer a 2.2-liter four-cylinder engine with front-wheel drive and a manual transmission; upmarket models add a continuously variable automatic transmission, all-wheel drive, and a V-6 engine. The new plastic-bodied SUV will begin production in November in Spring Hill, Tenn.
2002 Saturn VUE Base Prices
2.2L four-cylinder, front-drive manual $16,835
2.2L four-cylinder, front-drive VTi* $17,775
2.2 L four-cylinder, all-wheel-drive VTi* $19,370
3.0L V-6, all-wheel drive, automatic $23,085
Cargirl: The VUE from Saturn by Lesley Hazleton (1/19/2001)
FORD FACING SEX LAWSUIT
Is Ford’s Wixom, Mich., assembly plant a hotbed of sexual harassment? Pamela Perez says yes, as have at least 14 other employees who have filed suit against the plant’s management and against Ford itself. Automotive News reports that Perez was set to file a sexual-harassment lawsuit in Wayne County Circuit Court on Wednesday, alleging harassment at the plant and at her home — including sexual taunts and obscene phone calls — by her supervisors at Ford Motor Co. The news weekly says if filed, Perez’s case would be at least the 14th suit to be filed since 1995 by a female worker at the Wixom facility, which builds Lincolns and the Ford Thunderbird. Three years ago, Ford settled claims filed from its Chicago plant for $7.5 million; in a more widely reported case in 1998, Mitsubishi paid out $34 million to settle claims of harassment at its Normal, Ill., assembly facility.
Audio: Firestone Ends, Finally? by TCC Team (10/10/2001)
USED-CAR DEALERS INSPIRE NOBEL
A theory called asymmetric information — one that explains how used-car dealers hold an edge over consumers and therefore inspire loathing — has vaulted three American economists into the ranks of Nobel Laureates. George Akerlof, professor of economics at the University of California at Berkeley, will share the 2001 economics prize with Michael Spence of Harvard and Joseph Stiglitz of Columbia University for their explanations of how markets work when one side knows more than the other, and how this “asymmetric information” can lead to the development of adverse markets — such as one where bad used-car dealers crowd out the good ones.
ANTHRAX SCARE HITS AUTO MAGAZINE
The headquarters of AMI Auto World magazine were among those affected by the discovery of anthrax in Delray Beach, Fla., according to Automotive News. Auto World, a magazine started in Mississippi by former Car and Driver editor and publisher William Jeanes, is now located in south Florida along with AMI’s other publications, including the National Enquirer. The company’s headquarters were quarantined late Sunday when a photo editor was discovered to have anthrax; the worker later died, and two more employees have tested positive for the bacteria. Along with Auto World’s four employees, Toyota regional PR representative Bill Ussery, who had attended a meeting in the building, also expected to be tested for the bacteria.
EU HITS DC WITH BIG FINE
DaimlerChrysler hampered competition in European markets when it tried to restrict sales of its Mercedes-Benz cars, the European Union ruled on Wednesday. And as a result, the company will have to pay a $65.5 million fine, the largest fine since Volkswagen paid $77.4 million in 1998 for restricting sales in Italy. The EU’s Competition Commissioner said the German automaker had told its German dealers not to sell to customers living outside their territory, and required non-German residents to pay a 15-percent deposit, limited sales in Spain and engaged in price-fixing in Belgium. DaimlerChrysler has not decided on an appeal.
DC TO ANNOUNCE FR EIGHTLINER PLANS
And in the latest black hole in the DC financial picture, the company says it will announce its plans to restructure Freightliner within a few days. The U.S.-based truckmaking unit is said to be on track to lose $1 billion this year, and most analysts expect some job cuts and plant closures to stem the company’s red ink. In June, Freightliner announced a seven-percent workforce cut.
SIMPSON RACING RETRENCHING
Following the sudden departure founder Bill Simpson from the company bearing his name, the company has restructured its organization chart, starting at the top with Chuck Davies, who replaces Simpson. Simpson Racing, hit hard by allegations of seatbelt flaws in the wake of Dale Earnhardt's fatal February crash at Daytona, has also let go of its entire West Coast marketing staff. Headed by industry veteran John Dambros, all PR and marketing inquiries have been forwarded to Davies at Simpson's New Braunfels, Tx., headquarters.
Dale Earnhardt, 1951-2001 by Jason Sakurai (2/19/2001)
EMISSIONS MATTERS IN BIBENDUM CHALLENGE
Drivers are gearing up for a race, slated for October 26-29, where exhaust counts as much as speed. The Michelin Challenge Bibendum is a competition designed to demonstrate real-world development and progress of automotive environmental technology. Things like acceleration, top speed, handling, braking, and fuel efficiency are critical for the race as is low or no emissions. The race will be run from Los Angeles to Las Vegas with anything from diesels to electrics to hybrids. Bibendum, by the way, is that roly-poly guy in the Michelin commercials. –Bob Storck
DC, Ford Boost Ballard Share by TCC Team (10/8/2001)
ACDELCO CONTEST TAKES WINNERS TO LE MANS
ACDelco's Drive to Victory Sweepstakes offers over $50,000 worth of prizes including a trip to Paris to watch the world famous Le Mans auto endurance race and a two-year lease on a new Cadillac. Sweepstakes entry forms are available at independent service centers that feature and install ACDelco parts or via their Web site atwww.acdelco.com. No purchase is necessary. The sweepstakes promotion runs through Nov. 30, 2001. The Grand-Prize is a five-day, four-night trip for two in June 2002 to experience the thrills of the 24 Hours at Le Mans race. The prize includes airfare to Paris, hotel accommodations and transportation and tickets to the race. First Prize is a two-year lease on a Cadillac Seville. -Bob Storck
TODAY’S AUTO FACT
Not repairing vehicles properly on the first visit has a definite negative effect on customer satisfaction, according to the most recent J.D. Power Customer Satisfaction Index Study. On an industry basis, when a vehicle is brought in for repair and is not fixed, the impact on CSI is approximately 200 points lower. The most detrimental effect occurs when the customer does not bring the vehicle back to the dealership to correct the problem. The customer is left unsatisfied and the resulting CSI scores reflect that level of dissatisfaction.
FROM THE SOURCE
Global Electric Motorcars, LLC, a DaimlerChrysler company, is partnering with the Anaheim Transportation Network (ATN) to provide a demonstration fleet of 10 GEM neighborhood electric vehicles (NEVs) to provide large local employers an opportunity to use these zero-emission, low-speed vehicles at their workplaces…Dodge has officially opened the ordering process for its limited-production, racing-only 2003 Dodge Viper Competition Coupe. The race car will be sold in very limited numbers, expected to be about 25 each year. Purchase applications are being accepted from experienced racers only; prospective purchasers are required to show evidence of intent to actually race the car, along with current racing licenses and other information, and provide a certified deposit of $20,000…Gentex Corporation is shipping interior automatic-dimming mirrors with telematics functions to Ford Motor Company for the 2002 Lincoln Town Car. The mirrors contain the interface for the Lincoln Vehicle Communications System, which delivers a digital, wireless phone connection to the vehicle and enables functions like emergency roadside assistance, hands-free phone operation, and concierge services. Buttons on the face of the mirror activate the various telematics features…Sam G. Gibara, chairman and chief executive officer of The Goodyear Tire & Rubber Company, denies any Goodyear interest in acquiring any part or all of Pirelli's tire business. He said the companies have held no discussions on this subject…Working with local United Ways, Boost America! will give away 40,000 booster seats to needy families in California. Giveaway events are already planned in Los Angeles (October 24 and November 7), Sacramento (October 19) and San Francisco (October 20). Free and discounted booster seats are also being given away through vouchers redeemable at Toys "R" Us stores by Ford Motor Company dealers across the state. More than 17,000 vouchers have already been redeemed in California.
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