Chrysler to make Fiat in Mexico: report
Mon Aug 17, 2009 1:45am EDT
NEW YORK (Reuters) - Chrysler Group is planning to produce Fiat SpA's (FIA.MI: Quote, Profile, Research, Stock Buzz) Fiat 500 subcompact at a Chrysler plant in Mexico, the Wall Street Journal reported, citing people familiar with the matter.
Chrysler is also considering what other Fiat models to introduce to the U.S. market, under directions from its Italian partner, the paper reported on its website on Sunday.
Plans also include making a small Fiat engine for the 500 at a Chrysler plant in Trenton, Michigan, and building a Fiat-derived compact car slightly larger than the 500 in the United States, a source told the paper.
The Toluca, Mexico plant, which currently makes the Dodge Journey crossover and PT Cruiser, is an attractive home for the 500 because cars could be exported to South and Central America where the Fiat brand is popular, the Journal reported.
Fiat acquired a 20 percent stake in Chrysler and entered into agreements to give it access to Fiat technology and platforms. Chrysler filed for bankruptcy in April.
Chrysler representatives were not immediately available for comment.
(Reporting by Anupreeta Das; Editing by Lincoln Feast)
© Thomson Reuters 2009. All rights reserved. Users may download and print extracts of content from this website for their own personal and non-commercial use only. Republication or redistribution of Thomson Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters. Thomson Reuters and its logo are registered trademarks or trademarks of the Thomson Reuters group of companies around the world.
Thomson Reuters journalists are subject to an Editorial Handbook which requires fair presentation and disclosure of relevant interests.
---------------------
By KENNETH RAPOZA
SÃO PAULO -- General Motors Co. is targeting the emerging ultra-low-cost car market with plans for a compact for around $4,000, possibly producing it in Asia.
The segment is attracting increasing attention from manufacturers eager to keep sales momentum in developing markets following the sharp slide in car sales in North America and Western Europe.
"When Tata Motors in India came out with their $2,500 Nano vehicle it put a lot of auto makers on the spot," said Nick Reilly, GM's newly installed executive vice president of international operations.
Tata Motors Ltd. started shipping the much-promoted Nano to domestic customers in July, with a base price of just under $3,000, and executives have talked of selling versions of the car in the U.S., Europe and emerging markets.
Billed as the world's cheapest car, the Tata Nano, created in Mumbai, India is a car that crosses social and economic barriers, says Tata Group Chairman Ratan Tata. WSJ's Linda Blake comments. (March 24, 2009)
"We are not going to make cars that cheap because that is really a specific car for a very specific market that has different emissions standards and specifications than markets like the U.S. and Brazil," Mr. Reilly said at a media briefing Friday in Brazil, GM's third-largest market by sales after China and the U.S. "So we are looking at lower-cost vehicles, but do not know yet where it will be made or where will it be sold, though most likely in Asia."
Mr. Reilly said GM saw a market for a car that costs around $4,000.
GM already makes micro-minivans with Chinese partners that it plans to export, and is looking to expand that product range. Mr. Reilly said that SAIC GM Wuling Automobile Co. will likely sell significant numbers of vehicles outside of China, though not under the Wuling brand because GM doesn't own the branding rights.
Almost two-thirds of GM sales were outside North America in the first half of the year. Mr. Reilly, former head of GM's Asian business, was chosen last month by CEO Frederick "Fritz" Henderson to oversee all international business from headquarters in Shanghai, in part because of his track record in developing alliances.
"We are getting used to partnerships, and the industry as a whole will see more partnerships forming in 2009," Mr. Reilly said, adding that GM wasn't currently looking for partners in other large markets, like India.
Write to Kenneth Rapoza at ken.rapoza@dowjones.com
---------------------
Cash-for-clunkers boost Japanese car sales
By Bernard Simon in Toronto
Published: August 17 2009 22:45 | Last updated: August 17 2009 22:45
The US’s cash-for-clunkers scheme, designed to bolster Detroit’s embattled carmakers, is turning out to be an even bigger boon for their Japanese rivals.
According to data published by the National Highway Traffic Safety Administration on Monday, Americans are using the scrappage incentives to buy more vehicles from Toyota than any of the three Detroit carmakers.
Toyota has an 18.9 per cent share of vehicles bought so far, putting it ahead of General Motors with 17.6 per cent and Ford with 15.4 per cent. Chrysler is in fifth place, after Honda.
GM had a 19.6 per cent share of the overall US light-vehicle market in the first seven months of this year, compared with Toyota’s 16.3 per cent, according to Autodata, a New Jersey-based market research firm.
The top models bought since the scheme began on July 24 are the Toyota Corolla, Honda Civic and Ford Focus, all small sedans. Three of the top five are Toyotas.
The popularity of smaller models underlines the price paid by the Detroit companies for their strategy to all but cede the passenger car market to their foreign rivals during the 1990s as they concentrated on bigger and more profitable sport-utility vehicles, pick-up trucks and minivans.
All ten of the most traded-in clunkers are Detroit-made vehicles in these three segments.
GM and Chrysler are battling to regain market share following their court-supervised restructurings earlier this month. Furthermore, they have struggled to keep dealers stocked with the usual variety of models and options, having shut down much of their North American operations during their journeys through bankruptcy protection.
Credit Suisse estimates that Chrysler’s car inventories tumbled to 34 days supply at the end of July from 60 a month earlier. Its small Dodge Caliber is virtually sold out. A stock of 55-60 days supply is considered normal.
Under the cash-for-clunkers scheme, modeled on similar incentives in Europe, buyers who trade in old vehicles for those with lower fuel consumption receive a rebate of $3,500 or $4,500, depending on the fuel consumption of the replacement vehicle.
Congress initially earmarked $1bn for the incentives, but rushed to add another $2bn within a fortnight of the scheme’s introduction.
Analysts expect that the funds will last until early September, supporting the purchase of 700-750,000 new vehicles.
Toyota and its Asian rivals have sought to allay some politicians’ concern at the benefits they are reaping from the scheme by noting that a sizeable chunk of their vehicles are built in North America.
Copyright The Financial Times Limited 2009. Print a single copy of this article for personal use. Contact us if you wish to print more to distribute to others.
"FT" and "Financial Times" are trademarks of the Financial Times. Privacy policy | Terms
© Copyright The Financial Times Ltd 2009.