Industry Report: May 15, 2006

May 14, 2006

Ford Shareholders Send Chairman a MessageFord Motor Co. chairman William Clay Ford Jr. got an earful from a few shareholders during the company's annual meeting Thursday. One shareholder and Ford retiree claimed the Ford CEO had done little to help turn around the company's fortunes and said he wasn't qualified to lead the giant automaker. Nevertheless, there were only 64 shareholders present and voting at the meeting in Wilmington , Del. , indicating there wasn't much of revolt brewing against the Ford CEO at this point.However, many dissatisfied shareholders used two dissident resolutions to express their displeasure with the direction of the company. More than 22 percent of the voting shareholders cast their ballots for proposals that would have forced the recapitalization of the company and provided that all of the company's shares would have only one vote. The proposal would have ended the Ford family's use of separate Class B stock to retain control of the company. Another 19 percent of the shareholders voted for another resolution that would have split the job chairman of the board and chief executive. Ford's board of directors had opposed both measures, but the robust vote for both measures ensures that they will be back next year.Resolutions by environmentally minded shareholders demanding more accountability from the company didn't fare quite as well. Three proposals would have forced the board to disclose how much its spent lobbying against the CAFE standards, reporting on the company's impact on global warming and cooling, and tying executive compensation to reductions in greenhouse gas emissions. Each collected less than five percent of the votes by shareholders.Another measure that would have prevented the company from offering domestic partners benefits also was soundly defeated by a 95.27 to 4.73 margin. The measure had been opposed by Ford's management.Meanwhile, Bill Ford tried to reassure shareholders the company was on the right track. "We're taking a more far-sighted approach to creating shareholder value. Our actions will be guided by our long-term goals of building brands, satisfying customers, developing strong products, and driving innovation into everything we do," he added. -Joe Szczesny          Retired Detroit Workers Launch CampaignAt a press conference Thursday in Washington, D.C., The Level Field Institute, a group founded by retirees of the Big Three, announced it will begin a national advertising and PR campaign to educate consumers and stakeholders about the U.S. automobile manufacturing industrial base and the impact on the economy.Level Field President Jim Doyle said, "Our increasingly global economy makes defining 'made in America' more difficult. But we believe it still matters." He also indicated the group welcomes free trade and foreign investment but obviously is promoting the value and economic impact from the Big Three versus new manufacturing facilities and factories from international brands.Print, television, and Internet advertising from the group includes scorecards detailing the jobs and economic contributions of several leading manufacturers operating in the U.S., both from traditional and new manufacturers in manufacturing and research and development on a side-by-side basis. Kimberley Back in Charge at LotusFormer Lotus CEO Michael Kimberley is at it again - at the helm of the sports-car maker, that is. Kimberley , 68, has been named acting CEO upon the departure of Kim Ogaard-Nielsen, who left the company. Kimberley was the brand's CEO in the late 1980s and early 1990s when it was owned by General Motors. Under current Malaysian owners at Proton, Kimberley will oversee the continued revival of Lotus car sales worldwide, behind the Elise roadster and Exige coupe.  Chrysler Adds Third Shift at Illinois Plant

The Chrysler Group said Wednesday that it will add a third shift at its Belvidere, Ill., plant in July this year ahead of the launch of its Jeep Patriot SUV. The move will add another 1,000 employees to the payroll at the Chrysler facility at a time when rivals General Motors Corp. and Ford Motor Co are trimming their ranks.The Chrysler Group said in a statement that it expects most of the jobs to go to new hires.The plant, formerly the home of the Dodge Neon, operated on one shift for the best part of five years. In March this year, Chrysler kicked it up a notch, adding a second shift, as it ramped up production on its new compact car - the Dodge Caliber. The Caliber is the first in a family of three vehicles that will be made at Belvidere following a $419-million upgrade to the plant in 2005 to provide it with flexible manufacturing capabilities.The Caliber went into production in January. The new Jeep Compass is slated to join it on the assembly line this month, while the Jeep Patriot is scheduled to come on line in the third quarter of the year.-Louise DalySee more Patriot coverage from the New York auto show Toyota Sets New Earnings Marks Toyota released its fiscal-year financial report on Wednesday, and Japan 's largest automaker saw its net income rise to $12.4 billion, an increase of 17.2 percent over the previous fiscal year. The most recent fiscal year, which ended on March 31, was the third consecutive year in which Toyota bested income of one trillion yen ($9 billion). Strong sales, favorable exchange rates and cost-cutting measures led to the boosted revenue, Toyota president Katsuaki Watanabe said in a release. Overall, sales rose to 7.974 million units, with North American sales up to 2.556 million vehicles.  After SEC OK, GM Earns $445 Million in Q1 RevisionGeneral Motors swung from a loss in the first quarter of the year to a profit on Tuesday, as the automaker got permission for accounting changes from the U.S. Securities and Exchange Commission (SEC). GM had booked a loss of $323 million in the first quarter on Monday; with the restatement, GM now says it made $445 million in profit in the first quarter, the first for GM in six financial quarters. To book the gain, GM asked the SEC to change the way it accounts for the $3 billion in healthcare costs it agreed to in a recent deal with the United Auto Workers. GM will put the $3 billion into a new program that helps UAW members cover some of the increased cost of their healthcare. Losses in North America dropped to $462 million from the $946 million reported on Monday.Will GM's credit rating get cut again?  Toyota Dumps Exec Accused of HarassmentToyota has shunted aside Hideaki Otaka, the CEO of Toyota Motor North America, and will move U.S. sales chief Jim Press to New York, all in the wake of sexual harassment allegations at the automaker. Press, 59 and president of Toyota Motor Sales, becomes the president of the holding company that controls the American sales arm of the Japanese automaker. Yuki Funo, Automotive News reported late Monday night, will become the holding company's new CEO. Otaka, 65, resigned on Monday after his former assistant, Sayaka Kobayashi, charged Otaka with sexual harassment in a $190 million lawsuit on May 1. Press' duties will be assumed by Jim Lentz, but Press will not be directly replaced as of now. Saturn Ion Being Replaced by Astra; Spring Hill Questions?
2004 Saturn ION Red Line

2004 Saturn ION Red Line

General Motors' plans for a Saturn Ion replacement had hit a snag, but as is becoming common, the automaker's Opel division is coming in to pinch-hit. Saturn is already drawing on the European division for the new Aura sedan, a version of the Opel Vectra. And now Saturn's Ion will be replaced by a rebadged Opel Astra, beginning late next year. Automotive News reports that GM had planned a new entry-level Saturn named Evoke, which would have been based on the Chevrolet Cobalt, but that plan has been scuttled in favor of sharing the Astra with European customers. The Ion goes out of production this fall, and the Astra replacement won't be ready for some six to eight months later, other sources indicate. Saturn may keep the Astra nameplate and will certainly raise the price of the new vehicle above the Ion's sticker price of about $12,500 base.The production moves indicate that the future of the Spring Hill, Tenn., plant where Saturn was born may be in flux. The plant currently builds the Saturn Vue and Ion. While the Ion will be sourced from a European plant, the Vue is also expected to be derived from an Opel design - the Antara seen at auto shows earlier this year, and reinterpreted as the Saturn PreVue at the New York Auto Show. TheCarConnection's sources indicate the next Vue will be built at GM's Ramos Arizpe plant, late of the Pontiac Aztek, leaving the Spring Hill plant as yet unassigned for new products. GM has announced it will close a raft of plants in the U.S. as it downsizes and cuts 30,000 jobs but Spring Hill has not been named to the list for closure.TheCarConnection drives the 2007 Saturn Sky Hawaii Ends Gas-Price CapA short-lived experiment with caps on the price of gas in the state of Hawaii is over. On Friday, Gov. Linda Lingle suspended the eight-month-old price cap, which had been intended to cut prices on fuel for islanders. The state's prices were set to an average equal to that of Los Angeles , New York , and the Gulf Coast , plus transportation costs. Critics told Reuters that the caps failed because prices continued to rise anyway - hitting $3.38 on the islands late last week - and that setting a cap allowed oil companies to raise their prices to set limits. The news agency estimates that drivers on the islands may have paid up to $55 million more for gas than they would have without the price caps.   
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