OEM News

Ford surprised observers with a second-quarter profit of $2.3 billion on July 23, barely a year after posting the worst loss in company history. The positive number breaks the string of four straight quarterly losses and is the first positive quarter since first quarter 2008. The profit is due to a reduction in debt and associated expenses.

In a nationwide survey conducted the week of July 19, three out of ten dealers report having made a sale involving a "Cash for Clunkers" voucher even though the rules about how the program will be administered won't be issued until Friday, July 24. However, the clarity those rules will provide is still needed: Nearly 90% of dealers said consumers had either low or moderate awareness of the program, and two thirds (66%) said information given to dealers up until this point is "insufficient.

Ford, in its On Target publication, warns that it "does not approve the use of used restraint system modules, safety belts, buckles or retractors from pre-owned, salvage or damaged vehicles. The use of such parts could lead to serious injury." Ford also "recommends replacement of all safety belt assemblies in use at the time a vehicle is involved in an accident."

Rep. Steven LaTourette, R-Ohio, has sponsored a dealer amendment bill that would restore U.S. dealerships to their status before the GM and Chrysler bankruptcies. The measure would force Chrysler and GM to renew franchise agreements that were killed during bankruptcy proceedings or terminated by automakers. The amendment passed the House Appropriations Committee late July 7.

Wednesday, 08 July 2009 02:39

Plug in Prius will be mass produced in 2012

Toyota plans to launch its new plug-in Prius with lithium-ion batteries this year. Reuters is reporting that Toyota will start mass-producing its plug-in version of its Prius hybrid in 2012, with plans to make 20,000 to 30,000 of the vehicles that year.

To help dealers and shoppers connect through the Car Allowance Rebate System, Kelley Blue Book has launched a Cash for Clunkers Calculator on its Web site.

As expected, on July 2, Lear Corp., a supplier of automotive seating systems, electrical distribution systems and electronic products, has reached an agreement in principle regarding a consensual debt restructuring with steering committees representing its secured lenders and its bondholders. The company plans to commence the proposed restructuring under court supervision pursuant to a voluntary bankruptcy filing under Chapter 11 of the U.S. Bankruptcy Code by the company and certain U.S. and Canadian subsidiaries.

The CARS law calls for the turned in vehicle to be destroyed. This should translate into a jump in the number of vehicles that will be delivered to auto shredders.

Citing assets of $50-100 million and debts up to 5 times that, Proliance International filed for bankruptcy protection in U.S. (Delaware) court July. 2.  Proliance makes heat transfer and temperature control aftermarket parts for automotive, light and heavy duty trucks.

The nation's franchised auto dealers will play a critical role in educating consumers about the CARS, aka Cash for Clunkers voucher program. Moreover, because a limited number of vouchers - valued at up to $4,500 - will be given to automobile buyers before November 1st, it is estimated that car buyers will move quickly to take advantage of the program. Dealix, a division of Cobalt and the largest provider of new car and used car automotive sales leads to dealers and car manufacturers, and Edmunds.com, the premier online resource for automotive information, have teamed to provide resources to help dealers prepare to take action on the new law.