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Found 24 results

  1. Last week, Ford shocked the industry by announcing that it would cut most of its passenger car lineup. The only models that would remain are the Mustang and the upcoming Focus Active - due to arrive in 2019. The move has earned a fair amount of ire from various folks, but the company is trying to push back and explain their reasoning. "We're going to feed the healthy part of our business and deal decisively with the parts that destroy value," said Ford CEO Jim Hackett to Automotive News. The "healthy part" are Ford's utilities and trucks. According to Ford CFO Bob Shanks, this part made more than $3 billion in the first quarter of 2018. Ford is projecting that light trucks will make up 90 percent of North American sales in the near future. The car side hasn't been faring as well with sales declining for the past few years. Ford hasn't said how much money they have been hemorrhaging on cars, but UBS analyst Colin Langan estimates Ford is losing $800 million per year on small cars in North America. Automotive News also notes that consumer demand for cars may be even weaker than first thought. Looking registration data from Polk, the outlet reports that a third of Fusions sold last year went to fleet buyers (about 69,874 models). Shanks said there are other items that could be cut, including "most Lincoln products" and chunks of Ford's overseas business. A number of people who hate this idea point out that this could hurt Ford if gas prices spike up like they did in the 2000s. But Jim Farley, Ford's head of global markets points out that the gap in fuel economy between sedans and crossovers has closed up significantly. The 2018 Fusion has a combined fuel economy rating of 27, while the Escape is rated at 26 mpg. Farley also insisted that Ford isn't repeating the mistakes from the mid-2000s with their utility vehicles that almost sent them to the brink. The industry he says has "fundamentally changed" since then. "Customer view and experimentation on the utility side is so much more broad. Utilities are the preferred body style. This wasn't the case before the downturn," said Farley. "We intend to expand our passenger car lineup in the U.S We also intend to serve similar, affordable price points to today. What's changed here is just the format of the vehicle. Our dealers will have just as much opportunity to grow, just with a different portfolio." Still, there are some that are very skeptical about Ford's new strategy. "Eight years ago, Ford Motor Co. announced it was killing Mercury. It assured us not to worry, because there would be no problem taking care of Mercury customers at Ford dealerships — those customers would just buy Tauruses and Fusions," said Chris Lemley, owner of Sentry Auto Group near Boston. Source: Automotive News (Subscription Required) View full article
  2. Last week, Ford shocked the industry by announcing that it would cut most of its passenger car lineup. The only models that would remain are the Mustang and the upcoming Focus Active - due to arrive in 2019. The move has earned a fair amount of ire from various folks, but the company is trying to push back and explain their reasoning. "We're going to feed the healthy part of our business and deal decisively with the parts that destroy value," said Ford CEO Jim Hackett to Automotive News. The "healthy part" are Ford's utilities and trucks. According to Ford CFO Bob Shanks, this part made more than $3 billion in the first quarter of 2018. Ford is projecting that light trucks will make up 90 percent of North American sales in the near future. The car side hasn't been faring as well with sales declining for the past few years. Ford hasn't said how much money they have been hemorrhaging on cars, but UBS analyst Colin Langan estimates Ford is losing $800 million per year on small cars in North America. Automotive News also notes that consumer demand for cars may be even weaker than first thought. Looking registration data from Polk, the outlet reports that a third of Fusions sold last year went to fleet buyers (about 69,874 models). Shanks said there are other items that could be cut, including "most Lincoln products" and chunks of Ford's overseas business. A number of people who hate this idea point out that this could hurt Ford if gas prices spike up like they did in the 2000s. But Jim Farley, Ford's head of global markets points out that the gap in fuel economy between sedans and crossovers has closed up significantly. The 2018 Fusion has a combined fuel economy rating of 27, while the Escape is rated at 26 mpg. Farley also insisted that Ford isn't repeating the mistakes from the mid-2000s with their utility vehicles that almost sent them to the brink. The industry he says has "fundamentally changed" since then. "Customer view and experimentation on the utility side is so much more broad. Utilities are the preferred body style. This wasn't the case before the downturn," said Farley. "We intend to expand our passenger car lineup in the U.S We also intend to serve similar, affordable price points to today. What's changed here is just the format of the vehicle. Our dealers will have just as much opportunity to grow, just with a different portfolio." Still, there are some that are very skeptical about Ford's new strategy. "Eight years ago, Ford Motor Co. announced it was killing Mercury. It assured us not to worry, because there would be no problem taking care of Mercury customers at Ford dealerships — those customers would just buy Tauruses and Fusions," said Chris Lemley, owner of Sentry Auto Group near Boston. Source: Automotive News (Subscription Required)
  3. Jaguar Land Rover is making some cuts to their work staff. Today, the British automaker announced that it would not renew the contracts of 1,000 agency workers at its Solihull factory in the United Kingdom. According to Autocar, JLR is holding meetings with workers to discuss the changes. In a statement, JLR said the decision is due “continuing headwinds” that have forced the company to make "adjustments to production schedules and the number of agency staff”. Those “continuing headwinds” are due to regulatory crackdown on diesel engines and higher taxes being placed on these models. This confirms news late last week about the automaker making cuts to their workforce. JLR also announced that it would be moving 360 workers from the Castle Bromwich to Solihull due to declining car sales. Bromwich is where the company produces most of Jaguar's lineup (F-Type, XE, XF, and XJ). Sales of diesel vehicles have been hit hard due to the Volkswagen diesel emission scandal. Jaguar Land Rover has been hit the hardest in their home country of the United Kingdom. 90 percent of Jaguar Land Rover models sold in the country are diesels, compared to 45 percent globally. According to industry association SMMT, Land Rover saw sales decline 20 percent to 23,815 through March. Jaguar posted a larger 26 percent decline to 9.709. JLR is trying to change that as they get ready to launch the I-Pace EV later this year, and plans on introducing electrified variants of all of their models by 2020. Source: Automotive News (Subscription Required), Autocar
  4. Jaguar Land Rover is making some cuts to their work staff. Today, the British automaker announced that it would not renew the contracts of 1,000 agency workers at its Solihull factory in the United Kingdom. According to Autocar, JLR is holding meetings with workers to discuss the changes. In a statement, JLR said the decision is due “continuing headwinds” that have forced the company to make "adjustments to production schedules and the number of agency staff”. Those “continuing headwinds” are due to regulatory crackdown on diesel engines and higher taxes being placed on these models. This confirms news late last week about the automaker making cuts to their workforce. JLR also announced that it would be moving 360 workers from the Castle Bromwich to Solihull due to declining car sales. Bromwich is where the company produces most of Jaguar's lineup (F-Type, XE, XF, and XJ). Sales of diesel vehicles have been hit hard due to the Volkswagen diesel emission scandal. Jaguar Land Rover has been hit the hardest in their home country of the United Kingdom. 90 percent of Jaguar Land Rover models sold in the country are diesels, compared to 45 percent globally. According to industry association SMMT, Land Rover saw sales decline 20 percent to 23,815 through March. Jaguar posted a larger 26 percent decline to 9.709. JLR is trying to change that as they get ready to launch the I-Pace EV later this year, and plans on introducing electrified variants of all of their models by 2020. Source: Automotive News (Subscription Required), Autocar View full article
  5. Since last year, we've been hearing various rumors of Ford cutting a number of passenger cars. In October, Ford CEO Jim Hackett said various cuts were incoming, including ones for the vehicle lineup. This would be part of a $7 billion shift of development funds from passenger cars to SUVs/Trucks. At the time, Ford wouldn't say what vehicles would be cut. During Ford's fourth-quarter and 2017 earnings call, Hackett said details about which models would be cut would finally be revealed later this year. Analysts hoping to get an answer were frustrated by this news. Ford has already ended production of the C-Max Energi late last year and is planning to end production of the C-Max Hybrid sometime later this year. Other models that have been rumored to be cut include the Fiesta, Taurus, and recently the Fusion. Source: Automotive News Europe (Subscription Required) View full article
  6. Since last year, we've been hearing various rumors of Ford cutting a number of passenger cars. In October, Ford CEO Jim Hackett said various cuts were incoming, including ones for the vehicle lineup. This would be part of a $7 billion shift of development funds from passenger cars to SUVs/Trucks. At the time, Ford wouldn't say what vehicles would be cut. During Ford's fourth-quarter and 2017 earnings call, Hackett said details about which models would be cut would finally be revealed later this year. Analysts hoping to get an answer were frustrated by this news. Ford has already ended production of the C-Max Energi late last year and is planning to end production of the C-Max Hybrid sometime later this year. Other models that have been rumored to be cut include the Fiesta, Taurus, and recently the Fusion. Source: Automotive News Europe (Subscription Required)
  7. Ford's CEO Jim Hackett has unveiled his plans for the company and there are a lot of cuts coming, along with shifts in various investments. “I get up every day feeling like time can be wasted here if we don’t get moving. I feel a real sense of urgency,” Hackett told investors yesterday in New York. The cuts include a $10 billion cut in material outlays and a $4 billion cut in engineering costs over the next five years. Ford will also cut costs on internal combustion engines and redirect the funds to the development of EVs. One move that consumers will see is the reduction of possible vehicle configurations. For example, the current Escape has 2,302 configurations available. Ford will cut that down to 228 for the next-generation. The Fusion will see a dramatic reduction from 35,000 to just 96. "We really offered too many options," Hackett said. Speaking of cars, Ford will be moving $7 billion from the development of cars to trucks. This shift would mean fewer car nameplates, but the company wouldn't go into detail which ones would be cut. As we have reported in the rumorpile, the possible candidates for cuts include the C-Max, Fiesta, and Taurus. Other parts of Hackett's vision for Ford include, Playing catchup by offering internet connectivity in all of their vehicles by 2019. 90 percent of Ford's global lineup will feature some sort of connectivity by 2020. Building out more partnerships such as working with Lyft on deploying autonomous vehicles Cutting down it takes to develop and produce a new vehicle “The mandate here is that Ford must compete. Companies never choose to die and yet many by not evolving are enabling that kind of fate. It’s clear that as a company we must then raise our gaze just high enough to ensure we’re not disrupted as the world changes,” said Hackett. Source: Automotive News (Subscription Required), Bloomberg, Ford, Reuters Press Release is on Page 2 FORD’S FUTURE: EVOLVING TO BECOME MOST TRUSTED MOBILITY COMPANY, DESIGNING SMART VEHICLES FOR A SMART WORLD Ford initiates aggressive “fitness” push, re-basing revenue growth assumptions and attacking costs, while redesigning company operations for long-term success Capital will be allocated to regions, products and services with highest potential for growth and return; product shift calls for more trucks and SUVs, fewer passenger cars Ford is accelerating work on smart, connected vehicles, including AVs and EVs and digital services to thrive in emerging transportation operating system NEW YORK, Oct. 3, 2017 – Ford Motor Company today is providing a strategic update to investors, detailing plans to leverage its unique product strengths, trusted brand and global scale to refocus and thrive in an evolving and disruptive period for the auto industry. The investor presentation follows a four-month deep dive into Ford’s strategy and business operations led by President and CEO Jim Hackett and Ford’s senior leadership team. Hackett said Ford will improve its operational fitness, refocus capital allocation and accelerate the introduction of smart vehicles and services. “Ford was built on the belief that freedom of movement drives human progress,” said Hackett, who became Ford president and CEO on May 22. “It’s a belief that has always fueled our passion to create great cars and trucks. And today, it drives our commitment to become the world’s most trusted mobility company, designing smart vehicles for a smart world that help people move more safely, confidently and freely.” The full slide deck of the presentation can be found here. Ford is reaffirming its 2017 full-year financial guidance and said its 2018 outlook will be provided in January. Reiterating its long-term goal of an 8 percent automotive operating margin, Ford says it will embrace the profound technological changes and new competition buffeting the industry. To deliver, the company is expanding its scope to include vehicles and services – all designed around human-centered experiences. The company will tap its strengths integrating hardware and software in complex devices, its proven ability to deliver scale and the trust tied to the Ford brand. Specifically, Ford is: Accelerating the introduction of connected, smart vehicles and services customers want and value. By 2019, 100 percent of Ford’s new U.S. vehicles will be built with connectivity. The company has similarly aggressive plans for China and other markets, as 90 percent of Ford’s new global vehicles will feature connectivity by 2020. Rapidly improving fitness to lower costs, release capital and finance growth. Ford is attacking costs, reducing automotive cost growth by 50 percent through 2022. As part of this, the company is targeting $10 billion in incremental material cost reductions. The team also is reducing engineering costs by $4 billion from planned levels over the next five years by increasing use of common parts across its full line of vehicles, reducing order complexity and building fewer prototypes. Allocating capital where Ford can win the future. This starts with the company reallocating $7 billion of capital from cars to SUVs and trucks, including the Ranger and EcoSport in North America and the all-new Bronco globally. Ford also has plans to build the next-generation Focus for North America in China, saving capital investment and ongoing costs. Further, Ford is reducing internal combustion engine capital expenditures by one-third and redeploying that capital into electrification – on top of the previously announced $4.5 billion investment. Embracing partnerships. Ford will continue to leverage partnerships, remain active in M&A and collaborate to accelerate R&D. The company recently announced it was exploring a strategic alliance with Mahindra Group as it transforms its business in India, and Zoyte with the intention of developing a new line of low-cost all-electric passenger vehicles in China. When it comes to autonomous vehicle development, the company recently announced a relationship with Lyft to work toward commercialization and a collaboration with Domino’s Pizza to research the customer experience of delivery services. Expanding electric vehicle revenue opportunities. The company recently announced a dedicated electrification team within Ford, focused exclusively on creating an ecosystem of products and services for electric vehicles and the unique opportunities they provide. This builds on Ford’s earlier commitment to deliver 13 new electric vehicles in the next five years, including F-150 Hybrid, Mustang Hybrid, Transit Custom plug-in hybrid, an autonomous vehicle hybrid, Ford Police Responder Hybrid Sedan, and a fully electric small SUV. “When you’re a long-lived company that has had success over multiple decades the decision to change is not easy – culturally or operationally,” Hackett said. “Ultimately, though, we must accept the virtues that brought us success over the past century are really no guarantee of future success.” Revamping product development, modernizing factories At the same time, Ford is redesigning its operations to better compete in this disruptive era. Hackett cites as a template the example of how the company reimagined the all-new 2015 F-150. Since then, the F-Series has gained market share and the average transaction price has increased 16 percent. It has improved fuel economy and increased capability for customers, thanks in part to a 700-pound weight reduction that helped make the F-150 the company’s most positive contributor to CAFE standards for model year 2018. Additionally, 90 percent of the manufacturing equipment can be reused for the next-generation F-150, reducing future capital requirements. Finally, the innovation on aluminum and light weighting will pay off across a range of Ford trucks and SUVs. Other priorities include: Reducing orderable combinations of many nameplates, focusing on what customers value most. Already the team has identified a ten-fold reduction of orderable combinations in the next-generation Escape and is moving from approximately 35,000 combinations in the current generation of Fusion to 96 in the next generation. Rethinking product development processes and incorporating new technology. In the next five years, Ford is aiming to reduce new vehicle development time by 20 percent, with new tools and fewer orderable combinations. Through the use of virtual assembly lines, the company has been able to reduce new model changeover time by 25 percent. Redesigning the company’s factories of the future. Accelerating and scaling 3D printing, robotics, virtual reality tools and big data will improve logistics and enable a more efficient manufacturing footprint. “We believe Ford will achieve its competitive advantage by focusing deeply on our customers – whether they’re drivers, riders or cities – and that’s where we are playing to win,” Hackett said. View full article
  8. Ford's CEO Jim Hackett has unveiled his plans for the company and there are a lot of cuts coming, along with shifts in various investments. “I get up every day feeling like time can be wasted here if we don’t get moving. I feel a real sense of urgency,” Hackett told investors yesterday in New York. The cuts include a $10 billion cut in material outlays and a $4 billion cut in engineering costs over the next five years. Ford will also cut costs on internal combustion engines and redirect the funds to the development of EVs. One move that consumers will see is the reduction of possible vehicle configurations. For example, the current Escape has 2,302 configurations available. Ford will cut that down to 228 for the next-generation. The Fusion will see a dramatic reduction from 35,000 to just 96. "We really offered too many options," Hackett said. Speaking of cars, Ford will be moving $7 billion from the development of cars to trucks. This shift would mean fewer car nameplates, but the company wouldn't go into detail which ones would be cut. As we have reported in the rumorpile, the possible candidates for cuts include the C-Max, Fiesta, and Taurus. Other parts of Hackett's vision for Ford include, Playing catchup by offering internet connectivity in all of their vehicles by 2019. 90 percent of Ford's global lineup will feature some sort of connectivity by 2020. Building out more partnerships such as working with Lyft on deploying autonomous vehicles Cutting down it takes to develop and produce a new vehicle “The mandate here is that Ford must compete. Companies never choose to die and yet many by not evolving are enabling that kind of fate. It’s clear that as a company we must then raise our gaze just high enough to ensure we’re not disrupted as the world changes,” said Hackett. Source: Automotive News (Subscription Required), Bloomberg, Ford, Reuters Press Release is on Page 2 FORD’S FUTURE: EVOLVING TO BECOME MOST TRUSTED MOBILITY COMPANY, DESIGNING SMART VEHICLES FOR A SMART WORLD Ford initiates aggressive “fitness” push, re-basing revenue growth assumptions and attacking costs, while redesigning company operations for long-term success Capital will be allocated to regions, products and services with highest potential for growth and return; product shift calls for more trucks and SUVs, fewer passenger cars Ford is accelerating work on smart, connected vehicles, including AVs and EVs and digital services to thrive in emerging transportation operating system NEW YORK, Oct. 3, 2017 – Ford Motor Company today is providing a strategic update to investors, detailing plans to leverage its unique product strengths, trusted brand and global scale to refocus and thrive in an evolving and disruptive period for the auto industry. The investor presentation follows a four-month deep dive into Ford’s strategy and business operations led by President and CEO Jim Hackett and Ford’s senior leadership team. Hackett said Ford will improve its operational fitness, refocus capital allocation and accelerate the introduction of smart vehicles and services. “Ford was built on the belief that freedom of movement drives human progress,” said Hackett, who became Ford president and CEO on May 22. “It’s a belief that has always fueled our passion to create great cars and trucks. And today, it drives our commitment to become the world’s most trusted mobility company, designing smart vehicles for a smart world that help people move more safely, confidently and freely.” The full slide deck of the presentation can be found here. Ford is reaffirming its 2017 full-year financial guidance and said its 2018 outlook will be provided in January. Reiterating its long-term goal of an 8 percent automotive operating margin, Ford says it will embrace the profound technological changes and new competition buffeting the industry. To deliver, the company is expanding its scope to include vehicles and services – all designed around human-centered experiences. The company will tap its strengths integrating hardware and software in complex devices, its proven ability to deliver scale and the trust tied to the Ford brand. Specifically, Ford is: Accelerating the introduction of connected, smart vehicles and services customers want and value. By 2019, 100 percent of Ford’s new U.S. vehicles will be built with connectivity. The company has similarly aggressive plans for China and other markets, as 90 percent of Ford’s new global vehicles will feature connectivity by 2020. Rapidly improving fitness to lower costs, release capital and finance growth. Ford is attacking costs, reducing automotive cost growth by 50 percent through 2022. As part of this, the company is targeting $10 billion in incremental material cost reductions. The team also is reducing engineering costs by $4 billion from planned levels over the next five years by increasing use of common parts across its full line of vehicles, reducing order complexity and building fewer prototypes. Allocating capital where Ford can win the future. This starts with the company reallocating $7 billion of capital from cars to SUVs and trucks, including the Ranger and EcoSport in North America and the all-new Bronco globally. Ford also has plans to build the next-generation Focus for North America in China, saving capital investment and ongoing costs. Further, Ford is reducing internal combustion engine capital expenditures by one-third and redeploying that capital into electrification – on top of the previously announced $4.5 billion investment. Embracing partnerships. Ford will continue to leverage partnerships, remain active in M&A and collaborate to accelerate R&D. The company recently announced it was exploring a strategic alliance with Mahindra Group as it transforms its business in India, and Zoyte with the intention of developing a new line of low-cost all-electric passenger vehicles in China. When it comes to autonomous vehicle development, the company recently announced a relationship with Lyft to work toward commercialization and a collaboration with Domino’s Pizza to research the customer experience of delivery services. Expanding electric vehicle revenue opportunities. The company recently announced a dedicated electrification team within Ford, focused exclusively on creating an ecosystem of products and services for electric vehicles and the unique opportunities they provide. This builds on Ford’s earlier commitment to deliver 13 new electric vehicles in the next five years, including F-150 Hybrid, Mustang Hybrid, Transit Custom plug-in hybrid, an autonomous vehicle hybrid, Ford Police Responder Hybrid Sedan, and a fully electric small SUV. “When you’re a long-lived company that has had success over multiple decades the decision to change is not easy – culturally or operationally,” Hackett said. “Ultimately, though, we must accept the virtues that brought us success over the past century are really no guarantee of future success.” Revamping product development, modernizing factories At the same time, Ford is redesigning its operations to better compete in this disruptive era. Hackett cites as a template the example of how the company reimagined the all-new 2015 F-150. Since then, the F-Series has gained market share and the average transaction price has increased 16 percent. It has improved fuel economy and increased capability for customers, thanks in part to a 700-pound weight reduction that helped make the F-150 the company’s most positive contributor to CAFE standards for model year 2018. Additionally, 90 percent of the manufacturing equipment can be reused for the next-generation F-150, reducing future capital requirements. Finally, the innovation on aluminum and light weighting will pay off across a range of Ford trucks and SUVs. Other priorities include: Reducing orderable combinations of many nameplates, focusing on what customers value most. Already the team has identified a ten-fold reduction of orderable combinations in the next-generation Escape and is moving from approximately 35,000 combinations in the current generation of Fusion to 96 in the next generation. Rethinking product development processes and incorporating new technology. In the next five years, Ford is aiming to reduce new vehicle development time by 20 percent, with new tools and fewer orderable combinations. Through the use of virtual assembly lines, the company has been able to reduce new model changeover time by 25 percent. Redesigning the company’s factories of the future. Accelerating and scaling 3D printing, robotics, virtual reality tools and big data will improve logistics and enable a more efficient manufacturing footprint. “We believe Ford will achieve its competitive advantage by focusing deeply on our customers – whether they’re drivers, riders or cities – and that’s where we are playing to win,” Hackett said.
  9. William Maley

    Rumorpile: Ford Could Cut C-Max, Fiesta, & Taurus

    General Motors isn't the only one considering putting vehicles on the chopping block. The Detroit News has learned from three sources that Ford is considering ending production on three models for the U.S. - the Fiesta, C-Max Hybrid, and Taurus. Sources say the Taurus would be first to go in late 2018. The Fiesta would follow suit either in late 2018 or 2019. The C-Max would be the last model to end production in early 2019. Ford said they would make an announcement concerning the C-Max at a later date. The company declined to comment on the other vehicles. The Taurus has been long rumored to be cut from Ford's lineup due to poor sales. This was further bolstered by the company unveiling a new Taurus for China, but not for the U.S. back in 2016. Rumors about the Fiesta leaving the U.S. lineup began last year when CarScoops learned from a source that the next-generation Fiesta would not come to the U.S. due to there not being "enough demand to justify the costs." Earlier this week, Romanian site 0-100 spoke with Fiesta program manager Robert Stiller who said this, "The previous model was a global Ford product, and with the new generation we are targeting only Europe, the Middle East and Africa,” said Stiller. “In North America, especially in the US, China and Latin America, the demand for such cars is declining, and we are reacting accordingly.” Source: Detroit News, CarScoops, 0-100.ro
  10. General Motors isn't the only one considering putting vehicles on the chopping block. The Detroit News has learned from three sources that Ford is considering ending production on three models for the U.S. - the Fiesta, C-Max Hybrid, and Taurus. Sources say the Taurus would be first to go in late 2018. The Fiesta would follow suit either in late 2018 or 2019. The C-Max would be the last model to end production in early 2019. Ford said they would make an announcement concerning the C-Max at a later date. The company declined to comment on the other vehicles. The Taurus has been long rumored to be cut from Ford's lineup due to poor sales. This was further bolstered by the company unveiling a new Taurus for China, but not for the U.S. back in 2016. Rumors about the Fiesta leaving the U.S. lineup began last year when CarScoops learned from a source that the next-generation Fiesta would not come to the U.S. due to there not being "enough demand to justify the costs." Earlier this week, Romanian site 0-100 spoke with Fiesta program manager Robert Stiller who said this, "The previous model was a global Ford product, and with the new generation we are targeting only Europe, the Middle East and Africa,” said Stiller. “In North America, especially in the US, China and Latin America, the demand for such cars is declining, and we are reacting accordingly.” Source: Detroit News, CarScoops, 0-100.ro View full article
  11. BMW has plans on streamlining its production process and cutting down on the number of variants to help get more money into R&D. According to Reuters, BMW is ramping up development on electrics, autonomous vehicles, and new powertrains to meet stricter emission standards. Nicolas Peter, BMW's finance chief said the company spent 5.16 billion euros (about $5.91 billion) or 5.5 percent of revenue on R&D in 2016. "The next three years will be between 5.5 percent and 6 percent," said Peter. With the increase in R&D costs, BMW is looking everywhere to cut. Unfortunately, one of the items being cut is the manual transmission option for U.S.-spec 2-Series to cut certification costs. Over in Europe, BMW has been reducing the number of 5-Series models with the option of a manual. Peter also mentioned that there will be a reduction in the number of engines on offer. "In the 5 series we have four diesel engines on offer. I would not bet on there being four diesel engines on offer in the next generation vehicle." Source: Reuters
  12. BMW has plans on streamlining its production process and cutting down on the number of variants to help get more money into R&D. According to Reuters, BMW is ramping up development on electrics, autonomous vehicles, and new powertrains to meet stricter emission standards. Nicolas Peter, BMW's finance chief said the company spent 5.16 billion euros (about $5.91 billion) or 5.5 percent of revenue on R&D in 2016. "The next three years will be between 5.5 percent and 6 percent," said Peter. With the increase in R&D costs, BMW is looking everywhere to cut. Unfortunately, one of the items being cut is the manual transmission option for U.S.-spec 2-Series to cut certification costs. Over in Europe, BMW has been reducing the number of 5-Series models with the option of a manual. Peter also mentioned that there will be a reduction in the number of engines on offer. "In the 5 series we have four diesel engines on offer. I would not bet on there being four diesel engines on offer in the next generation vehicle." Source: Reuters View full article
  13. Ford isn't doing so well at the moment as profits and stock prices are tumbling downward. To try and reverse this trend, the blue oval is considering cutting 10 percent of its global workforce. Both the Wall Street Journal and Reuters have learned from their respective sources the cuts are part of a previously announced plan to slash costs by $3 billion. The cuts will mostly affect salaried employees, with Reuters reporting Ford will offer generous early retirement incentives. To give you an idea of how jobs are on the chopping block, Ford currently 200,000 employees. A cut of 10 percent means 20,000 people are out of a job. "Reducing costs and becoming as lean and efficient as possible also remain part of that work. We have not announced any new people efficiency actions, nor do we comment on speculation," Ford said in a statement. Source: Reuters, Wall Street Journal (Subscription Required)
  14. Ford isn't doing so well at the moment as profits and stock prices are tumbling downward. To try and reverse this trend, the blue oval is considering cutting 10 percent of its global workforce. Both the Wall Street Journal and Reuters have learned from their respective sources the cuts are part of a previously announced plan to slash costs by $3 billion. The cuts will mostly affect salaried employees, with Reuters reporting Ford will offer generous early retirement incentives. To give you an idea of how jobs are on the chopping block, Ford currently 200,000 employees. A cut of 10 percent means 20,000 people are out of a job. "Reducing costs and becoming as lean and efficient as possible also remain part of that work. We have not announced any new people efficiency actions, nor do we comment on speculation," Ford said in a statement. Source: Reuters, Wall Street Journal (Subscription Required) View full article
  15. William Maley

    General Motors Plans More Cuts

    General Motors seems being in a cutting mood as it drives to improve its profit margins and stock price. Last week saw the sale of Opel and Vauxhall to PSA Group and it's only the beginning said GM CEO Mary Barra. Automotive News reports that GM is considering reducing investments in North American cars and "select" international markets according to a chart that was shared during a conference call with analysts last week. The chart says these two earned a spot on the chopping block due to low profit potential and weak strength in franchises. "There's a little bit more work that we're doing in the international markets. Our overall philosophy is that every country, every market segment has to earn its cost of capital," Barra said on the conference call. Barra and GM President Dan Ammann declined to go into details about these plans. GM has already made significant changes in terms of their international operations by ending or reducing operations Australia, Indonesia, Russia, and Thailand. The automaker has also scaled back plans in India. The comments made during the call suggest more cuts could take place here and possibly elsewhere. As for 'reducing investments in North American cars', this likely means GM is taking a hard look at various segments in passenger car segment. With consumers trending towards utility vehicles and trucks, sales of passenger cars have been falling precipitously. As of March 1st, dealers had four month's worth of inventory of cars, compared to an 81-day supply for light trucks and less than 60-days for full-size SUVs. GM could walk away from certain segments such as compacts or full-size sedans, or delay investments in certain models. These moves will allow GM to funnel money into models that make more money, and returning capital to shareholders. "That's an immediate opportunity for us to reward shareholders without changing the risk profile of the company or our ability to manage through a downturn," GM CFO Chuck Stevens said. Analysts are mixed on GM's plans. "It takes a lot of discipline to shift away from a volume-is-king kind of mentality," she said. "In the end, that's going to make a better GM -- a longer-standing company that's not only more profitable but more relevant," said Rebecca Lindland, a senior analyst with Kelley Blue Book to Automotive News. John Murphy, an analyst with Bank of America Merrill Lynch isn't so sure about this plan. "It appears that GM's recent decision-making has become much more short-term-focused and, in our opinion, could create challenges for the company in the coming years," Murphy wrote in a report. Source: Automotive News (Subscription Required)
  16. General Motors seems being in a cutting mood as it drives to improve its profit margins and stock price. Last week saw the sale of Opel and Vauxhall to PSA Group and it's only the beginning said GM CEO Mary Barra. Automotive News reports that GM is considering reducing investments in North American cars and "select" international markets according to a chart that was shared during a conference call with analysts last week. The chart says these two earned a spot on the chopping block due to low profit potential and weak strength in franchises. "There's a little bit more work that we're doing in the international markets. Our overall philosophy is that every country, every market segment has to earn its cost of capital," Barra said on the conference call. Barra and GM President Dan Ammann declined to go into details about these plans. GM has already made significant changes in terms of their international operations by ending or reducing operations Australia, Indonesia, Russia, and Thailand. The automaker has also scaled back plans in India. The comments made during the call suggest more cuts could take place here and possibly elsewhere. As for 'reducing investments in North American cars', this likely means GM is taking a hard look at various segments in passenger car segment. With consumers trending towards utility vehicles and trucks, sales of passenger cars have been falling precipitously. As of March 1st, dealers had four month's worth of inventory of cars, compared to an 81-day supply for light trucks and less than 60-days for full-size SUVs. GM could walk away from certain segments such as compacts or full-size sedans, or delay investments in certain models. These moves will allow GM to funnel money into models that make more money, and returning capital to shareholders. "That's an immediate opportunity for us to reward shareholders without changing the risk profile of the company or our ability to manage through a downturn," GM CFO Chuck Stevens said. Analysts are mixed on GM's plans. "It takes a lot of discipline to shift away from a volume-is-king kind of mentality," she said. "In the end, that's going to make a better GM -- a longer-standing company that's not only more profitable but more relevant," said Rebecca Lindland, a senior analyst with Kelley Blue Book to Automotive News. John Murphy, an analyst with Bank of America Merrill Lynch isn't so sure about this plan. "It appears that GM's recent decision-making has become much more short-term-focused and, in our opinion, could create challenges for the company in the coming years," Murphy wrote in a report. Source: Automotive News (Subscription Required) View full article
  17. Another victim has been claimed by Volkswagen's diesel emission scandal. Various reports have Audi either delaying or canceling a number of projects in an effort to save as much money as possible. German business paper Der Spiegel reports Audi's head Rupert Stadler told staff that "all future investments" are now "under scrutiny". Reuters has learned from various sources that Audi has delayed a number of projects including a track that would have been used for self-driving vehicles and facilities to make batteries and concept cars. An Audi spokesman told Reuters that projects pertaining to a technology park known as INovation-Campus have been "postponed for the foreseeable future". Autocar reports that Audi could be dropping two platforms as well; Audi's own MLB (currently underpinning the A4 and A5 and will underpin next A6, A7, and A8) and the mid-engine platform that underpins the R8. These cuts could hamper Audi's plans of introducing a lineup of electric vehicles that were intended help improve its image from the diesel emission mess. But it might also help curb Audi's habit of spending way too much money. Reuters says the Ingolstadt company spends more on equipment, plants, and property than BMW or Daimler. Unsurprisingly, Audi's works council isn't pleased with this news. The council argues that delaying investments could undermine employment at Audi's headquarters. Source: Reuters, Der Spiegel (Subscription Required), Autocar
  18. Another victim has been claimed by Volkswagen's diesel emission scandal. Various reports have Audi either delaying or canceling a number of projects in an effort to save as much money as possible. German business paper Der Spiegel reports Audi's head Rupert Stadler told staff that "all future investments" are now "under scrutiny". Reuters has learned from various sources that Audi has delayed a number of projects including a track that would have been used for self-driving vehicles and facilities to make batteries and concept cars. An Audi spokesman told Reuters that projects pertaining to a technology park known as INovation-Campus have been "postponed for the foreseeable future". Autocar reports that Audi could be dropping two platforms as well; Audi's own MLB (currently underpinning the A4 and A5 and will underpin next A6, A7, and A8) and the mid-engine platform that underpins the R8. These cuts could hamper Audi's plans of introducing a lineup of electric vehicles that were intended help improve its image from the diesel emission mess. But it might also help curb Audi's habit of spending way too much money. Reuters says the Ingolstadt company spends more on equipment, plants, and property than BMW or Daimler. Unsurprisingly, Audi's works council isn't pleased with this news. The council argues that delaying investments could undermine employment at Audi's headquarters. Source: Reuters, Der Spiegel (Subscription Required), Autocar View full article
  19. A number of Volkswagen executives will not be seeing their full bonus for 2015. In a statement today, Volkswagen announced bonus payments for top executives will be cut "significantly." This announcement comes a week after it was revealed that Volkswagen Group Chairman Hans Dieter Poetsch would be getting about 10 million euros (about $11.4 million) as compensation for stepping down as the company's CFO. News about this bonus angered Volkswagen's labor leaders and the state of Lower Saxony, Volkswagen's second-largest shareholder. They argued Volkswagen should just scrap the bonuses since Volkswagen could experience more financial pains due to the diesel emission scandal. "Supervisory Board and Management Board jointly agreed that – given the current situation of the company – a signal should also be sent with respect to the topic of the Management Board's remuneration," said Volkswagen in a statement. Volkswagen hasn't said how much the bonuses will be cut, but a source tells Reuters that it will be around 30 percent. Sources also reveal that further measures are being discussed to reduce variable pay even further, but that might be enough resolve the dispute with the union leaders and Lower Saxony. Volkswagen's supervisory board will make a decision on the cuts at its next meeting later this April. Source: Reuters, Volkswagen Press Release is on Page 2 Volkswagen AG informs on Wednesday: "Supervisory Board and Management Board jointly agreed that – given the current situation of the company – a signal should also be sent with respect to the topic of the Management Board's remuneration. Different models which would constitute a reasonable and fair solution for all parties involved are currently discussed and coordinated. As a consequence, this would lead to a significant reduction of the variable remuneration. This would also subsequently apply to Mr. Poetsch at his own request. The individual compensation components will be adopted in the forthcoming Supervisory Board meeting and will be published in the annual report on 28 April."
  20. A number of Volkswagen executives will not be seeing their full bonus for 2015. In a statement today, Volkswagen announced bonus payments for top executives will be cut "significantly." This announcement comes a week after it was revealed that Volkswagen Group Chairman Hans Dieter Poetsch would be getting about 10 million euros (about $11.4 million) as compensation for stepping down as the company's CFO. News about this bonus angered Volkswagen's labor leaders and the state of Lower Saxony, Volkswagen's second-largest shareholder. They argued Volkswagen should just scrap the bonuses since Volkswagen could experience more financial pains due to the diesel emission scandal. "Supervisory Board and Management Board jointly agreed that – given the current situation of the company – a signal should also be sent with respect to the topic of the Management Board's remuneration," said Volkswagen in a statement. Volkswagen hasn't said how much the bonuses will be cut, but a source tells Reuters that it will be around 30 percent. Sources also reveal that further measures are being discussed to reduce variable pay even further, but that might be enough resolve the dispute with the union leaders and Lower Saxony. Volkswagen's supervisory board will make a decision on the cuts at its next meeting later this April. Source: Reuters, Volkswagen Press Release is on Page 2 Volkswagen AG informs on Wednesday: "Supervisory Board and Management Board jointly agreed that – given the current situation of the company – a signal should also be sent with respect to the topic of the Management Board's remuneration. Different models which would constitute a reasonable and fair solution for all parties involved are currently discussed and coordinated. As a consequence, this would lead to a significant reduction of the variable remuneration. This would also subsequently apply to Mr. Poetsch at his own request. The individual compensation components will be adopted in the forthcoming Supervisory Board meeting and will be published in the annual report on 28 April." View full article
  21. Volkswagen is making some big changes for the future. In a statement released today, the company announced that it would cut 1 Billion Euros (about $1.1 billion) in investments. The statement didn't say would be part of the cuts. Volkswagen also announced that it would be fitting diesel models sold in Europe and U.S. with SCR and AdBlue technology 'as soon as possible'. Further down in the statement, Volkswagen announced that it would put more of a focus on battery and plug-in powertrains for its MQB architecture (what underpins the Golf and the upcoming Tiguan. Along with this, the company is working on a new modular electric “toolkit” that could deliver around 155 to 300 Miles on a charge. Volkswagen has also given a preview of what's in store for the next Phaeton. The statement talks about a specification of the model that will feature a pure electric drive. "The Volkswagen brand is repositioning itself for the future. We are becoming more efficient, we are giving our product range and our core technologies a new focus, and we are creating room for forward-looking technologies by speeding up the efficiency program," said Volkswagen brand chief Herbert Diess. Source: Volkswagen Press Release is on Page 2 Volkswagen Brand Board of Management takes strategic decisions Accelerated implementation of the efficiency program creates room for reorientation Streamlined processes leverage further cost-saving potential, including cuts in fixed costsInvestments to be reduced by 1 billion euros per year compared with planning – combined with prioritization of projects for the future Product decisions formulatedNew Phaeton will be electric New Modular Electric Toolkit planned The newly-formed Volkswagen Brand Board of Management took further strategic decisions at a special meeting. CEO Dr. Herbert Diess announced major product decisions: a reorientation of the diesel strategy with the most advanced technologies, the development of a standardized electric architecture for passenger cars and light commercial vehicles, and a new approach for the next generation of the Phaeton. Investments are to be reduced by some one billion euros per year, the efficiency program is to be accelerated. Dr. Herbert Diess underscored: "The Volkswagen brand is repositioning itself for the future. We are becoming more efficient, we are giving our product range and our core technologies a new focus, and we are creating room for forward-looking technologies by speeding up the efficiency program." Reorientation of the diesel strategy It was decided to switch over to installing only diesel drives with SCR and AdBlue technology in Europe and North America as soon as possible. Diesel vehicles will only be equipped with exhaust emissions systems that use the best environmental technology. Systematic further development of the Modular Transverse Toolkit (MQB) There will be a major development thrust for the proven MQB standardized technical toolkit, where Volkswagen Passenger Cars holds responsibility for development within the Group network. The focus is on plug-in hybrids with an even greater range, high-volume electric vehicles with a radius of up to 300 kilometers, a 48-volt power supply system (mild hybrid) as well as ever more efficient diesel, petrol and CNG concepts. A new standard with regard to connectivity and driver assistance systems is to be defined. MEB electric toolkit An MEB electric toolkit for future use in compact segment vehicles is to be developed based on the experience gained with existing vehicle architectures. This will be a multi-brand toolkit suitable for both passenger cars and light commercial vehicles and will thus leverage synergies from other electric vehicle projects in the Group. The standardized system will be designed for all body structures and vehicle types, thus allowing particularly emotional vehicle concepts, and will enable an all-electric range of 250 to 500 kilometers. Phaeton redefined – the future is electric The Volkswagen Phaeton has embodied the brand's technological competence and brand ambition from the first generation onward. The future generation of the Phaeton will once again be the flagship for the brand's profile over the next decade. In light of this, the Board of Management redefined the current project. The specification features a pure electric drive with long-distance capability, connectivity and next-generation assistance systems as well as an emotional design. Accelerated efficiency program Dr. Herbert Diess said: "We are very aware that we can only implement these innovations for the future of the Volkswagen brand effectively if we succeed with our efficiency program and in giving our product range a new focus." Diess continued: "Together with my Board of Management colleagues and the entire team we are working at top speed on these issues. Time and again, the Volkswagen team has proved it stands united and is fully focused on shaping the future, particularly when times are tough. We have now laid the further foundations for that." View full article
  22. Volkswagen is making some big changes for the future. In a statement released today, the company announced that it would cut 1 Billion Euros (about $1.1 billion) in investments. The statement didn't say would be part of the cuts. Volkswagen also announced that it would be fitting diesel models sold in Europe and U.S. with SCR and AdBlue technology 'as soon as possible'. Further down in the statement, Volkswagen announced that it would put more of a focus on battery and plug-in powertrains for its MQB architecture (what underpins the Golf and the upcoming Tiguan. Along with this, the company is working on a new modular electric “toolkit” that could deliver around 155 to 300 Miles on a charge. Volkswagen has also given a preview of what's in store for the next Phaeton. The statement talks about a specification of the model that will feature a pure electric drive. "The Volkswagen brand is repositioning itself for the future. We are becoming more efficient, we are giving our product range and our core technologies a new focus, and we are creating room for forward-looking technologies by speeding up the efficiency program," said Volkswagen brand chief Herbert Diess. Source: Volkswagen Press Release is on Page 2 Volkswagen Brand Board of Management takes strategic decisions Accelerated implementation of the efficiency program creates room for reorientation Streamlined processes leverage further cost-saving potential, including cuts in fixed costsInvestments to be reduced by 1 billion euros per year compared with planning – combined with prioritization of projects for the future Product decisions formulatedNew Phaeton will be electric New Modular Electric Toolkit planned The newly-formed Volkswagen Brand Board of Management took further strategic decisions at a special meeting. CEO Dr. Herbert Diess announced major product decisions: a reorientation of the diesel strategy with the most advanced technologies, the development of a standardized electric architecture for passenger cars and light commercial vehicles, and a new approach for the next generation of the Phaeton. Investments are to be reduced by some one billion euros per year, the efficiency program is to be accelerated. Dr. Herbert Diess underscored: "The Volkswagen brand is repositioning itself for the future. We are becoming more efficient, we are giving our product range and our core technologies a new focus, and we are creating room for forward-looking technologies by speeding up the efficiency program." Reorientation of the diesel strategy It was decided to switch over to installing only diesel drives with SCR and AdBlue technology in Europe and North America as soon as possible. Diesel vehicles will only be equipped with exhaust emissions systems that use the best environmental technology. Systematic further development of the Modular Transverse Toolkit (MQB) There will be a major development thrust for the proven MQB standardized technical toolkit, where Volkswagen Passenger Cars holds responsibility for development within the Group network. The focus is on plug-in hybrids with an even greater range, high-volume electric vehicles with a radius of up to 300 kilometers, a 48-volt power supply system (mild hybrid) as well as ever more efficient diesel, petrol and CNG concepts. A new standard with regard to connectivity and driver assistance systems is to be defined. MEB electric toolkit An MEB electric toolkit for future use in compact segment vehicles is to be developed based on the experience gained with existing vehicle architectures. This will be a multi-brand toolkit suitable for both passenger cars and light commercial vehicles and will thus leverage synergies from other electric vehicle projects in the Group. The standardized system will be designed for all body structures and vehicle types, thus allowing particularly emotional vehicle concepts, and will enable an all-electric range of 250 to 500 kilometers. Phaeton redefined – the future is electric The Volkswagen Phaeton has embodied the brand's technological competence and brand ambition from the first generation onward. The future generation of the Phaeton will once again be the flagship for the brand's profile over the next decade. In light of this, the Board of Management redefined the current project. The specification features a pure electric drive with long-distance capability, connectivity and next-generation assistance systems as well as an emotional design. Accelerated efficiency program Dr. Herbert Diess said: "We are very aware that we can only implement these innovations for the future of the Volkswagen brand effectively if we succeed with our efficiency program and in giving our product range a new focus." Diess continued: "Together with my Board of Management colleagues and the entire team we are working at top speed on these issues. Time and again, the Volkswagen team has proved it stands united and is fully focused on shaping the future, particularly when times are tough. We have now laid the further foundations for that."
  23. William Maley

    Scion: Less Dealers May Be More

    William Maley Staff Writer - CheersandGears.com August 19, 2013 Scion has billed itself as being the offbeat, youth oriented brand in the Toyota group. So it comes as a bit of surprise to find out that Scion currently has 1,100 dealers across the U.S. - 200 fewer than Toyota. Considering Scion's small lineup and declining sales over the past few years, this isn't good news. With all of these factors in play, it doesn't come as a surprise that Toyota's US group vice president, Bill Fay said to Wards Auto that Scion's dealer network "might actually go down a little bit." Then this week, a Texas dealer told Automotive News that Toyota will allow dealers to stop selling Scion with no repercussions. "If you don't want Scion, if it doesn't work for you, it's OK if you want to walk away," the dealer said. How did so many dealers end up with Scion? They wanted a piece of the massive sales success the brand was experiencing in the first few years. In 2006, Scion moved 173,034 units, well above the niche-level sales the brand was projecting at time. But since then, sales have been falling. Total sales in 2012 were 73,505 units. “Mini has about 115 (stores), Volvo has about 300, Lincoln wants about 325, Infiniti has about 200, so I would probably expect Scion to have between 350-500 but placed in more strategic locations,” said Dave Sullivan, analyst for AutoPacific. What lies ahead for Scion? Fay mentioned that Toyota is considering a few possibilities for the brand. One of those includes moving the brand to a premium level. Toyota also showed dealers a couple of products that are in the pipeline; the FR-S Cabriolet which is or is not dead and a subcompact crossover. Source: Automotive News (Subscription Required), Wards Auto William Maley is a staff writer for Cheers & Gears. He can be reached at william.maley@cheersandgears.com or you can follow him on twitter at @realmudmonster.
  24. William Maley Staff Writer - CheersandGears.com August 19, 2013 Scion has billed itself as being the offbeat, youth oriented brand in the Toyota group. So it comes as a bit of surprise to find out that Scion currently has 1,100 dealers across the U.S. - 200 fewer than Toyota. Considering Scion's small lineup and declining sales over the past few years, this isn't good news. With all of these factors in play, it doesn't come as a surprise that Toyota's US group vice president, Bill Fay said to Wards Auto that Scion's dealer network "might actually go down a little bit." Then this week, a Texas dealer told Automotive News that Toyota will allow dealers to stop selling Scion with no repercussions. "If you don't want Scion, if it doesn't work for you, it's OK if you want to walk away," the dealer said. How did so many dealers end up with Scion? They wanted a piece of the massive sales success the brand was experiencing in the first few years. In 2006, Scion moved 173,034 units, well above the niche-level sales the brand was projecting at time. But since then, sales have been falling. Total sales in 2012 were 73,505 units. “Mini has about 115 (stores), Volvo has about 300, Lincoln wants about 325, Infiniti has about 200, so I would probably expect Scion to have between 350-500 but placed in more strategic locations,” said Dave Sullivan, analyst for AutoPacific. What lies ahead for Scion? Fay mentioned that Toyota is considering a few possibilities for the brand. One of those includes moving the brand to a premium level. Toyota also showed dealers a couple of products that are in the pipeline; the FR-S Cabriolet which is or is not dead and a subcompact crossover. Source: Automotive News (Subscription Required), Wards Auto William Maley is a staff writer for Cheers & Gears. He can be reached at william.maley@cheersandgears.com or you can follow him on twitter at @realmudmonster. View full article

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