Industry Report: Nov. 28, 2005

 

Hyundai Shows '07 Santa Fe, Prices Azera

Hyundai HQ in South Korea has released the first photos of the new Santa Fe online at its Korean-language Web site. The new Santa Fe hasn't yet been shown for U.S. journalists or shoppers, and as such, there's precious little information about the new SUV available. Based on information from our spy-shot photographers, the Santa Fe will be outfitted with the 263-hp V-6 from the Azera as well as a five-speed automatic transmission; a third-row seat will be available, as will all-wheel drive, when the Santa Fe enters production early next year at the new Hyundai plant in Montgomery, Ala.

In more Hyundai news, the company announced pricing on the new Azera luxury sedan on Tuesday. The Azera SE, with standard 263-hp 3.8-liter V-6, eight airbags, stability control and a five-speed automatic, will retail from $24,995. The Limited model will be priced from $27,495 with added equipment like a CD changer and fog lamps. The Ultimate Package on the Azera Limited brings the price of that model to $29,995.

Ford Won't Rush Cuts

Ford Motor Co. won't move up the announcement of its next turnaround plan, the automaker's CEO Bill Ford said Tuesday, despite this week's announcement by General Motors that it will slash jobs at assembly, powertrain and stamping plants across its network, closing three assembly plants completely. The family heir and chief executive said he doesn't want to rush Mark Fields, who took over Ford's core Americas unit only last month. "The worst thing we could do is roll out a plan 30 days after (Fields) got there and have to come back 60 days later," with yet another plan. Nonetheless, observers expect Ford to follow GM's lead, with plant closings and job cuts. It is also seeking health care concessions from the United Auto Workers union similar to those the UAW granted GM last month.-TCC Team

Big Three Have to Woo Back Consumers, Ford Says

"It's up to us (the Big Three U.S. carmakers) to prove to the American buying public…that our products are attractive and represent good value and also feature cutting-edge technology," Bill Ford, CEO of his namesake company said Tuesday. Ford faced a polite but tough audience during an appearance in Washington, at the National Press Club, fielding a number of questions about how the Big Three can reverse declining share and profits. In a speech laden with references to America, Americans and American automakers, Ford took pains to separate the Big Three from foreign-owned manufacturers simply assembling cars in the U.S.

In his speech, the CEO suggested that his strategy for Ford is to focus on more fuel-efficient and environmentally-friendly vehicles. "We're transitioning to a more fuel-efficient fleet and a smaller fleet," he asserted in response to a follow-up question. The automaker is also shifting emphasis to hybrids and other alternative forms of power. But Ford stressed his belief that the government needs to participate in the transition. Among other things, he called for tax credits to help develop future powertrain technologies, as well as the infrastructure to produce and distribute alternative fuels. The CEO noted that right now, there are only 500 service stations providing ethanol in the entire U.S. Federal support is needed, he said, "so we can go from hundreds of stations, to thousands." Following his speech, Ford headed over to the White House to outline his plan to government leaders. The proposals were "non-partisan," he insisted, stressing that, "If we don't adapt" to a world without cheap and plentiful gasoline, "we deserve the consequences." -TCC Team

Dodge Has Challenger Coupe forDetroit

A new concept coupe to be shown at the Detroit auto show in January will take the name of Challenger. The long-expected two-door will take on the Ford Mustang directly with a chassis derived from Chrysler's 300C/Magnum twins, along with a 425-hp version of the HEMI V-8 in the most thrilling versions. Chrysler is expected to show the car as a concept at the show, but insiders suggest the vehicle will be in production as early as 2009 on a new version of the 300C platform. Chrysler has only offered this official sketch of the concept prior to the January auto show debut, but these spy shots were taken last week as the vehicle was prepared for its auto-show debut. Stay tuned for more information on the Challenger as TCC previews the Detroit auto show on December 15^th.

GM Cutting 30,000 Jobs, Eight Plants

Acknowledging the need for some "tough medicine" to stem mounting losses, General Motors CEO Rick Wagoner announced plans to close five North American assembly plants, while trimming production at two more.  Along with cuts in powertrain and other operations, the turnaround plan is expected to eliminate 30,000 hourly jobs - but reduce costs by several billion dollars, according to GM, by the time the project is completed in 2008.

At that point, GM will wind up with 30 percent less North American capacity than it had in early 2002, but according to Wagoner, that should put production more in line with market demand. And operating at 100 percent capacity, he contended, should go a long way towards restoring the automaker's financial strength.

"It's tough medicine for us," acknowledged Wagoner, the troubled automaker's increasingly embattled chief executive. But there was little choice, in light of the North American market's increasingly competitive nature. "The difference in the business from 10 to 12 years ago has been startling."

General Motors has been the subject of almost daily headlines this year, few of them positive. The automaker's market share has been on the skids, and its employee pricing program provided only a brief and tenuous respite from the decline. Earnings have plunged, largely as the result of weak North American operations. Last month, the automaker reported $1.6 billion in third-quarter losses, though the blow was softened somewhat by an agreement with the United Autoworkers Union granting health care concessions that GM values at $15 billion.

The automaker's original goal was to shave about $6 billion in costs in 2006 from what Wagoner said Monday is a structural base "in the low-$40 billion range." With the plant cuts, that will increase to an estimated $7 billion in savings.

GM Cutting 30,000 Jobs, Eight Plants (11/21/2005)
"Tough medicine," but no guarantees, says Wagoner.

Hyundai HCD-9 Talus Concept Coming to Detroit

Coming to the Detroit auto show in January is the latest Hyundai concept vehicle to wear the HCD tag. Since the 1990s, Hyundai has used the letters to promote its concept coupes, and on the latest vehicle, the HCD-9 Talus, Hyundai provides little information other than the sketch distributed to the media this week. The sportscar is expected to be shown at the Detroit auto show alongside the new Santa Fe SUV, which makes its worldwide debut at the same show.