January 26, 2010
D.C. Auto Show Gets Higher Profile this Year
The Washington Auto Show, which begins Wednesday, typically isn't the place where new models are unveiled. But there's no doubt that the event's profile is higher than normal this year, thanks in no small part to the billions of dollars that have been coming from the direction of Capitol Hill. According to the Washington Post, about 30 vehicles that made their debut at Detroit's recent car show will be making an appearance at the D.C. show, organizers say, and the underlying theme is clear: " 'Electric' is the big deal this year," says Gerard Murphy, president of the Washington Area New Automobile Dealers Association, the event's sponsor. Since last year's show, industry shakeouts have caused the Washington area dealer's group to lose about 10 percent of the licensed franchisees that constitute its membership. The association now has 203 members. Tammy Darvish, vice president of Darcars Automotive Group and AIADA member, said she'll be keeping an eye on attendance at this year's show as a rough gauge of consumer interest for the year ahead. The Detroit auto show reported about a 15 percent increase in show floor traffic. "It's good that interest is piqued again," she said. Click here for more on what to expect from this week's Washington Auto Show.
Whitacre Named GM's Permanent CEO
Ed Whitacre Jr. is dropping the interim from his CEO title at General Motors Co. and he reaffirmed Monday the automaker would repay in full its loans from the U.S. and Canadian governments by June. According to MSNBC, Whitacre said GM's board asked him to become permanent CEO last week, ending a seven-week search for a new top executive. The U.S. government provided GM with $52 billion in assistance - including about $6.7 billion in loans - that the automaker used to survive and emerge from bankruptcy protection last year. Much of that will be repaid when the company goes public again. Whitacre, 68, is a former CEO of telecommunications giant AT&T Inc. Although GM had hired a search firm, there were strong signs that Whitacre would take the job permanently, or at least serve as CEO until the company is on solid enough ground to sell stock to the public in an effort to repay its government loans. In a wide-ranging talk with reporters at GM's Detroit headquarters earlier this month, Whitacre predicted that GM would be profitable this year, although he said that was dependent on the economy and other factors. Click here for complete coverage of GM's new CEO, Ed Whitacre.
Toyota Plans to Sell 8.27 Million Vehicles in 2010
Toyota said Tuesday it plans to sell 8.27 million vehicles worldwide this year, up 6 percent from 2009, showing the world's No. 1 automaker is optimistic about recovery after being battered by the global slowdown. Toyota sold 7.81 million vehicles worldwide in 2009, down 13 percent from the previous year. In 2010, sales in Japan are expected to grow 7 percent to 2.13 million vehicles, while overseas sales were expected to grow 6 percent to 6.14 million, according to Toyota. According to The Detroit News, the company's president, Akio Toyoda, the grandson of the company's founder, who took office last year, has been playing down growth ambitions, making comments that stress the crisis the company faces and its need to return to basics to make appealing cars. The automaker has also suffered a blow to its image in announcing two massive recalls within the space of two months in the U.S. to fix accelerator pedals that get stuck. In recent years, Toyota had been aggressive in moving into small trucks and other larger vehicles that deliver bigger profits in the North American market, rather than sticking to the small cars on which Japanese automakers had built their reputation. Click here to read more about Toyota's 2010 sales goals.
Rejected Dealers File Over 1,442 Arbitration Notices
As the clock ticked down the final hours before the midnight deadline, dealerships had filed more than 1,442 notices of intent to seek arbitration as of the end of Monday afternoon - far exceeding expectations. The latest figure suggests that at least half of all eligible General Motors Co. and Chrysler Group dealerships could end up filing for arbitration and paying the $1,625 filing fee. According to Automotive News, Dealerships had until midnight on Monday to pay at least a $500 partial filing fee and indicate that they intend to seek reinstatement through neutral arbitration provided under a law signed by President Barack Obama last month. Dealerships may have fewer withdrawals than other businesses because their arbitrations have a six-and-a-half-month time limit under the legislation, she said. Dealer lawyers have estimated that a case typically will cost between $30,000 and $50,000, rising as high as $100,000 in complex cases. Dealerships can obtain a 50 percent refund of their filing fees if they withdraw within 30 days of either June 15 or 25, with the deadline still to be determined, Johnson said. Arbitration decisions are due to be handed down in June under the legislation. For full coverage of dealerships who have filed arbitration notices under recent legislation, click here.
Lambo Shifts R&D Focus from more HP to Fewer Pounds
According to Automotive News, Lamborghini's drivetrain wizards say they have all the horsepower they need for their superfast cars. So from here on, performance gains will come from using lighter materials to reduce vehicle weight, instead of from chasing more engine thrust. "It has come to the point where acceleration equals consumption," said Stephan Winkelmann, CEO of the Italian automaker. "More consumption means increased CO2 emissions." Winkelmann, who fears future government regulations could restrict engine performance, said Lamborghini's r&d spending will emphasize taking weight out of vehicles. The pursuit of top speed is limited by the physics of aerodynamic resistance, Maurizio Reggiani, Lamborghini's r&d chief, said in an interview this month. Once a vehicle reaches 211 mph, there is a declining rate of return for each additional horsepower needed to push the vehicle faster. Also, there are few places in the world where a driver can go that fast. Reggiani said Lamborghini will focus on acceleration instead of top speed. The most effective way to do that: take weight out of the car. Lamborghini has used mostly high-strength steel in its vehicles' structures and body panels. But Reggiani said the automaker will make greater use of aluminum and carbon fiber. Click here for more on Lamborghini's plans to make its cars lighter in the future.
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