Green Machines Color Tokyo Show

October 24, 2005

Green Machines Color Tokyo Show

White has traditionally been the most popular color for Japanese motorists, but at this year's Tokyo Motor Show, the dominant hue is green. Automakers have filled Makuhari Messe with an assortment of environmentally-friendly hybrids and fuel-cell vehicles, though some continue to express caution about the technologies.

Toyota already produces the world's best-selling hybrid-electric vehicle, the Prius, and it used the show to send the message that it intends to remain the dominant force in hybrids. The automaker's Estima hybrid concept features the latest version of the

Toyota Synergy Drive
system, and even has a new exhaust heat recovery system which it claims can be used to reduce emissions of CO2 and other harmful gases. The hybrid system provides power for four separate wheel motors — as well as AC power which could be used for a portable TV or refrigerator.

Toyota's high-line Lexus brand finally unveiled the GS460h, a hybrid version of the sporty sedan launched last year. Unlike conventional, mileage-minded hybrids, the focus will be on using the hybrid system to enhance performance when the GS comes to market next year. Company insiders tell TheCarConnection, meanwhile, that they expect the hybrid version of the next LS sedan — showcased at Makuhari Messe as the LF-Sh prototype — will outperform both the Mercedes S-Class and BMW 7-Series sedans.

Even smaller Japanese makers, like Subaru are getting into the hybrid act. Subaru rolled out its B5-TPH concept, a crossover sport wagon with a turbo parallel hybrid, integrating several electric motors into its all-wheel-drive powertrain.

Nissan has been the most reluctant of Japan's big three to enter the hybrid segment. CEO Carlos Ghosn is openly skeptical of hybrid-electric economics, though he concedes his company has to participate, if for no other reason than public relations. Nissan offered the all-electric Pivo, with its long-range lithium-ion batteries, as one of its green entries at Makuhari Messe. It also displayed a hydrogen-powered version of the small Xtrail SUV. Nissan officials noted they've been able to sharply reduce the size of their electric motors, batteries and fuel cell stack, which should improve their competitiveness.

Mazda's Senku concept reportedly will serve as the prototype for its next-generation RX-8 sports car. Its unclear whether Mazda will also offer a hybrid version in production, though in the concept, a hybrid system is mated to Mazda's distinctive rotary engine. To make things even greener, the Senku powers up on hydrogen. Mazda has long promoted the idea of using the lightweight gas in its rotaries, going back to the HRX series concept vehicles.

How long it would take to build a supporting hydrogen infrastructure is a question few industry leaders can yet answer. That didn't stop them from displaying an array of fuel cell vehicles, including Honda's sports FCV Concept. It follows the lead of recent General Motors fuel-cell offerings, by placing its hardware under the floor to expand passenger and cargo space.

Import makers have typically taken a back seat at the Tokyo Motor Show, but Mercedes-Benz didn't want to let its Japanese rivals score all the environmentally-friendly headlines. Its fuel-cell-powered F600 HYGENIUS is based on the new B-Class crossover vehicle. The system generates a modest 115 horsepower, but 258 lb-ft of torque. It claims more than 80 mpg fuel economy and a driving range of 250 miles. Mercedes officials suggested they could launch production by as early as 2010.

With Japanese fuel prices running nearly as high as in Europe , there's great potential for a boom in hybrids and other alternative-fuel vehicles. Diesels have never connected with Japanese buyers, however, and fuel-cell vehicles remain years from production. Even hybrids have yet to connect. While Japanese makers dominate the new market segment, home-market demand continues to lag well behind the U.S.

2005 Tokyo Show: Last Words (10/23/2005)
The TCC team wraps up this year's motor show season.

Preview: Nissan GT-R (10/23/2005)
"The crystallization" of all Nissan stands for?

Preview: Lexus LF-Sh (10/23/2005)
Can the next-generation LS conquer the luxury world?

2005 Tokyo Motor Show Index (10/18/2005)

UAW Agrees to Healthcare Cuts

The United Auto Workers has agreed to contract changes to help bail out General Motors Corp.'s ailing North American operations. The proposed concessions require GM's active workers to defer $1 per hour of wage increases planned through 2006 to help finance the cost of healthcare benefits.

In addition, retirees with GM pensions also will pay more for healthcare through a combination of new monthly premium payments and increases in co-payments and deductibles. Depending on the plan, individuals could wind up paying $370 for healthcare, while families will pay $752 annually for their healthcare. Many, but not all, of GM's blue-collar retirees now pay nothing for healthcare except for some co-payments on prescription drugs and additional deductible for retirees who have stuck with traditional plans.

In addition, both active and retired workers will have to make a larger co-payment for so-called lifestyle drugs such as Viagra.

Before the tentative agreement was signed in Detroit , GM blue-collar workers were paying only seven percent of the overall cost of the healthcare benefit, while GM's salaried employees were paying 24 percent. The percentage paid by white-collar employees is slated to rise again this fall as salaried employees sign up for plans for 2006.

Richard Wagoner, GM chief executive officer, said that the new healthcare plan will save the company $3 billion annually on a pre-tax basis and reduce the automaker's outstanding liability for post-retirement healthcare for employees by 25 percent or $15 billion over the next seven years.

UAW Agrees to Healthcare Cuts (10/23/2005)
Union gives in on GM's healthcare requests.

Flint: The UAW Giveth and Taketh

The General Motors-UAW agreement to reduce some healthcare benefits is important, but don't get carried away. GM may not save a penny for several years.

What the UAW giveth, the UAW taketh away, too. I haven't seen all the details, but General Motors says it will save $1 billion cash a year. That is $1 billion out of a total healthcare bill of $5.6 billion this year and climbing.

But GM also says it will put $1 billion into a new healthcare fund next year, and another $1 billion into that fund the following year, 2007. The UAW loves special funds. This one is to help retirees who need help with their healthcare after the changes. So for the first two years, it's a wash, $1 billion saved each year and $1 billion spent in the special fund each year. To simple me, that means no savings those first two years.

In addition, it appears to me that GM agreed to pick up another $1 billion in liabilities for the Delphi UAW workers. I don't know when that will be kicking in, but it will eat into the savings, too.

Flint: The UAW Giveth and Taketh (10/23/2005)
The numbers get juggled around in the GM-UAW deal.

Ford Turnaround Plan in Jan.

Ford Motor Co. expects by January to have in place a new restructuring plan for its ailing North American automotive business.

William Clay Ford Jr., Ford CEO, had said last month he hoped to outline part of the plan, which will include plant closings, by the time the company released its third-quarter financial report. However, the deadline for completion of the plan, which is designed to help the company compete in an era of rising gasoline prices, was delayed to allow a new executive team time to tweak it.

Mark Fields, the new executive in charge of Ford's automotive business in the Americas, and Anne Stevens, the new executive vice president of operations who serves as Fields' chief deputy, will be in charge of the effort, Ford said, and it was best to give them a chance to review the plan before it was made public.

Both Fields and Stevens were promoted to their new jobs only this month during an executive shakeup, the likes of which invariably seem to precede any shift in the company's direction. Among the casualties were Phil Martens, the head of Ford's product development effort.

Ford Turnaround Plan in Jan. (10/23/2005)
Company promises "significant" plant shutdowns and job cuts.

Ford's Financial Position Worsens

Ford Motor Co.'s financial position grew steadily worse in the third quarter as sales of sport-utility vehicles continued to decline and operations in Europe continued to run into difficulty.
The loss of $284 million, or 15 cents a share, including $191 million, or 10 cents per share, from ongoing operations, was larger than anticipated by the consensus estimate of analysts put together by First Call. Ford had posted a profit $266 million, or 15 cents per share, during the same period of 2004.

William Clay Ford Jr., Ford chairman and chief executive officer, said the loss reflected the difficult competitive environment in which the company operates. The red ink in the third quarter included a $1.2 billion loss by the company's North American operations, the company reported. So far this year U.S. sales of Ford vehicles are down 1.3 percent, despite a massive discount program that helped clear inventory of unsold vehicles.

Don Leclair, Ford's chief financial officer, also said the automaker was hurt by the rising price of steel and rising warranty costs to cover the repairs on defective vehicles. So far this year, Ford's North American business has lost more than $1.4 billion and the cash reserves dwindled to $19.6 billion from $21.8 billion in the third quarter, according to the company's financial report.

Ford's Financial Position Worsens (10/23/2005)
Turnaround can't come too soon for number two.

FROM THE SOURCE headlines from the latest press releases

PRNewswire

Chevrolet will host five women impacted by Hurricane Katrina this weekend at the 2nd Annual Essence Magazine Women Who are Shaping the World Leadership Summit in New York City. The five women — ranging from a CEO to a homemaker — had a variety of experiences during the Hurricane disaster. According to Corvette Marketing Manager Karen Rafferty, the effort complements Chevy's "Revolution to Rebuild" philosophy.


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Autoliv Inc. ALV 41.33 +0.18 (+0.44%)
AutoNation Inc. AN 18.53 -0.64 (-3.34%)
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BorgWarner Inc. BWA 55.00 -1.06 (-1.89%)
Cummins Inc. CMI 78.21 -2.41 (-2.99%)
Dana Corporation DCN 7.39 -0.37 (-4.77%)
DaimlerChrysler AG (ADR) DCX 47.68 -0.34 (-0.71%)
Delphi Corporation DPH 0.36
Dura Automotive Systems DRRA 3.40 +0.07 (+2.10%)
Eaton Corporation ETN 57.65 -1.26 (-2.14%)
Ford Motor Company F 8.25 -0.17 (-2.02%)
General Motors Corporation GM 28.26 -0.12 (-0.42%)
Gentex Corporation GNTX 18.56 -0.13 (-0.70%)
Goodyear Tire & Rubber GT 13.60 -0.05 (-0.37%)
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Johnson Controls Inc. JCI 65.87 -1.47 (-2.18%)
Lear Corporation LEA 30.09 -0.26 (-0.86%)
Magna International Inc. MGA 66.27 -0.54 (-0.81%)
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Tower Automotive Inc. TWRAQ.PK 0.14 +0.01 (+7.69%)
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