As Camry and Prius Sales Slide, Toyota Ramps Up SUVs

First Up 05/17/17

House Panel to Examine Border Tax Next Week 
The House Ways and Means Committee will hold a hearing next week that will focus in part on the controversial border adjustment tax provision in Speaker Paul Ryan's (R-Wis.) tax plan. According to The Hill, the May 23 hearing, titled “Increasing U.S. Competitiveness and Preventing American Jobs from Moving Overseas,” will be part of a series of tax-reform hearings that the Ways and Means Committee is kicking off on Thursday. The proposal has drawn concerns from other GOP lawmakers, including several Ways and Means Committee members. And Senate Majority Leader Mitch McConnell (R-Ky.) said Tuesday that the provision "probably wouldn't pass the Senate." The Ways and Means Committee is expected to hold several tax-reform hearings in the coming weeks, as congressional Republicans and the White House work to develop a proposal that they can all get behind. On Thursday, the panel will start those hearings with a meeting about tax reform's impact on economic growth. For more on next week’s border adjustment tax hearing, click here.

As Camry and Prius Sales Slide, Toyota Ramps Up SUVs 
The Toyota Camry has been America’s best-selling car for 15 years. Yet last month, Toyota’s RAV4, a crossover sport utility vehicle, sold 329 more units in the U.S. According to The Detroit News, it’s the second time this year that the RAV4 has topped the Camry in monthly sales, and the trend says a lot about the direction of the market and how the world’s most valuable automaker is adjusting. Vehicle sales in the U.S. have been climbing steadily since the recession and set another record last year at about 17.5 million units. That growth has been driven by trucks and SUVs, recently at the expense of passenger cars. The challenge for Toyota is to adjust its products for the new demand and to do so without giving away too much in incentives. Early last month, the industry’s average incentive was nearly $3,500 per vehicle, the highest ever for April, according to J.D. Power. For more on how Toyota is ramping up SUV sales in the U.S., click here.

Ford to Cut 1,400 Salaried Jobs in North America 
Ford Motor Co. on Wednesday said it plans to cut 10 percent of its salaried employees in North America and Asia to cut costs amid slowing sales and growing investments in new technology. According to Automotive News, the automaker will offer voluntary early retirement and special separation packages to roughly 1,400 white-collar workers in the two regions combined and expects the cuts to come by the end of September. Ford said nearly all of its “skill teams” will be affected, except for product development, Ford Credit, manufacturing, IT, and global data and analytics. A Ford spokesman said the reductions will affect corporate staff, including the finance, legal, human resources, communications, government, marketing, sales, and service departments. The buyouts are part of a strategy Ford laid out last September at its investor day conference, when CFO Bob Shanks said the automaker would be looking to save about $3 billion per year each of the next three years as costs rise. For more on Ford’s job cuts, click here.

BMW, Intel Add Delphi to Self-Driving Car Alliance 
German automaker BMW Group and U.S. tech giant Intel strengthened their self-driving car alliance with the addition of auto supplier Delphi, putting the companies a step closer to their goal of delivering an autonomous car by 2021, reports The Detroit Free Press. BMW and Intel said Tuesday that they had struck a deal to collaborate with Delphi on development and integration of self-driving car technology, with a particular emphasis "in the areas of perception, sensor fusion and high performance automated driving computing." Richard Rau, BMW's vice president of sensors, control units and software, also told reporters that the company is in "very deep discussions" to add other automakers to the alliance, possibly "within a few weeks." For more on BMW’s self-driving car alliance, click here.

Volvo Cars Says New Generation of Diesel Engines Could Be the Last: CEO 
Reuters reports that Swedish carmaker Volvo's latest generation of diesel engines could be its last as the cost of reducing emissions of nitrogen oxide is becoming too much, Chief Executive Hakan Samuelsson was quoted as saying on Wednesday. "From today's perspective, we will not develop any more new generation diesel engines," Samuelsson told German's Frankfurter Allgemeine Zeitung in an interview. However, a Volvo Cars spokesman said on Wednesday Samuelsson had been discussing options rather than a firm plan to stop the further development of diesel engines. Samuelsson later said in a statement emailed to Reuters he believed diesel would still play a crucial role in the next few years in helping the company meet targets to reduce emissions of carbon dioxide, being more fuel-efficient than petrol engines. For more on Volvo’s statements regarding the future of diesel engines, click here.

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