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Archive for October, 2011

Marchionne Wants to Eliminate 2-Tier Wage Structure at Chrysler

“Economic disparity…cannot go on indefinitely.”

by on Oct.28, 2011

CEO Sergio Marchionne is signalling Chrysler must find a way to eliminate the 2-tier union wage structure.

Despite the significant cost savings it is bringing to the smallest of the domestic automakers, Chrysler CEO Sergio Marchionne signaled that the maker’s two-tier wage structure is something he plans to eliminate in the not-too-distant future.

About one in eight of Chrysler’s 26,000 union workers in the U.S. currently fall into the second tier, earning about half as much as more senior members of the United Auto Workers Union – a figure expected to grow to at least one in four by the time the newly ratified 4-year UAW contract expires in 2015, said Marchionne during a conference call.

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The union failed to eliminate the two-tier structure during its recent contract talks with Chrysler, General Motors and Ford, though it did win so-called “new hires” a modest increase of about $3 an hour in wages and some additional benefits.  But in an unexpected turn, Marchionne suggested that having multiple grades is “structurally undesirable.”

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VW Hits Earnings Home Run; Daimler Profits Slip

Volkswagen confirms it is on track to be global #1.

by on Oct.27, 2011

The real battle for world dominance will be in China where VW is firmly entrenched.

Volkswagen delivered a huge third quarter, while rival Daimler had its problems.

Confirming it is on track to become the global sales leader Volkswagen revealed it had also hit one out of the park, tripling its net profit for the third quarter of 2011.

Things didn’t go so well for VW’s German rival during the July – September quarter, however, Daimler AG announcing a 15% earnings decline – even though senior officials insisted the company is still on track to deliver better numbers for all of 2011.

Volkswagen’s big increase accompanied a sharp jump in worldwide sales, which reached 6.2 million vehicles during the first nine months of this year.  With VW expected to top sales of 8 million for the full year, industry analysts have predicted the carmaker will outsell rivals General Motors and Toyota – which had led the industry for the last few years but has been hurt by production cuts resulting from the Japanese earthquake of March 11.

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For his part, VW Chief Executive Martin Winterkorn admitted his goal of world automotive domination, though not necessarily this year, telling investors, “We are on the right path to becoming the world’s leading automaker by 2018 — in both economic and ecological terms.”

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Chrysler Claws Back into the Black

$212 mil profit reflects rising sales.

by on Oct.27, 2011

Third-quarter results were "totally in line" with Chrysler's plans, says CEO Sergio Marchionne.

Long struggling Chrysler is having a decidedly good week.  Just a day after getting word that its U.S. hourly workers have approved their new contract, the automaker is reporting it clawed back into the black during the third quarter with a $212 net profit.

The maker lost $84 million during the July – September quarter in 2010.  The black ink is the result of a sharp surge in demand for Chrysler products, with revenues for the latest quarter up 19% to $13.1 billion.

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“In the third quarter, Chrysler Group achieved increased sales and positive financial results, totally in line with the plan we laid out in November 2009. And in October, together with the United Auto Workers, we crafted a solid four-year contract that will support us in our growth plans and significantly reward our employees for their contribution to the revival of Chrysler,” said Sergio Marchionne, Chairman and CEO of both Chrysler LLC and its Italian partner, Fiat.

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First Look: 2012 Audi A4 and S4

Getting ready to take on the new BMW 3-Series.

by on Oct.27, 2011

Audi makes some modest but notable changes to the A4 and S4 for the upcoming model-year.

It’s never easy to go up against a powerhouse like the BMW 3-Series, and that’s especially true when an all-new version of the Bavarian juggernaut is getting ready to roll into showrooms.  So, it’s understandable why Audi is also getting ready for a mid-cycle update of its own compact luxury line, with updated A4 and S4 models slated for 2012.

Don’t expect anything radical.  Audi isn’t tearing up the blueprints and starting over.  The basic dimensions remain largely the same.  The new model is stretched by a few millimeters – unlike the 3-Series, which grows substantially for 2012.  But Audi aficionados will recognize there are some significant changes, nonetheless.

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The most distinctive, however, will be found under the hood, with a range of new or modified engines for the global line-up expected to deliver both better mileage and improved horsepower and torque.  New Stop/Start technology is one way Audi has been able to pull off that seemingly incongruous improvement.

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Kia and Antenna Take to the Surf

Where’s the board go?

by on Oct.27, 2011

Antenna magazine works with Kia to come up with the modern surf buggy.

We’re still waiting to see who comes up with the first dune buggy based on the latest generation of the Volkswagen Beetle.  In the meantime, we’ll be happy to head for the beach in this tricked-out 2012 Kia Rio5 pulled together by Antenna magazine – which will make its debut at the upcoming SEMA Show.

We’re not quite sure what the green stuff growing in the corner is, but we’re assuming it’s not medical marijuana.  As for the rest of the revisions, Antenna and Kia seem to believe that surfers are an organized bunch, incorporating some well-placed shelves and drawers for sneakers, swimsuits and, we’re assuming, wet suits.

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What we don’t seem to see is a place for surfboards.  Perhaps the rack will be added in time for the SEMA event, which begins later this month in Las Vegas.

There’s a retro touch, the Antenna Kia Rio5 working in not only an old Atari game console but also a turntable.  Remember records?

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Buick Enclave: Looks Like a Lady

Big crossover is alone on the market with elegant, even feminine, good looks.

by on Oct.27, 2011

Buick's Enclave is uniquely styled compared to all other big crossovers

Crossovers and sport utility vehicles with masculine designs are commonplace. If tough is what you’re looking for, there are plenty to choose from.

That’s what makes the Buick Enclave so unique. Instead of tough and rugged or high-tech, the Enclave is curvy, elegant – and different from every other big crossover or SUV on the market. With apologies to all of the guys out there who drive one, you could even the Enclave feminine.

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Take a close look at the Enclave the next time you see one on the street. Is there another crossover on the market that has curves around its wheel wells like the Enclave? Narrows in the middle? Wears its jewelry so elegantly? Well, Mazda’s CX-9 – not to mention the smaller CX-7 – have curves, but they tend toward athleticism, not elegance.

Even though the big Buick has been on the market for more than 3 years, surprisingly no other automaker has followed Buick’s lead. And despite so much time on the market, the Enclave still looks fresh.

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UAW Hourly Workers Approve Chrysler Contract

But rejection by skilled trades workers raises problems.

by on Oct.26, 2011

Chrysler workers barely approved their new contract.

Members of the United Auto Workers Union have ratified their new four-year labor agreement with Chrysler Group LLC but also opened the door to protests inside the company that union leaders could find difficult to control.

The new agreement covers approximately 26,000 hourly and salaried workers employed by Chrysler in the U.S.

The vote tally was released barely a week after Ford workers approved their own contract by a two-to-one majority.  At Chrysler the results were significantly closer, the “Yes” vote totaling only 55%.  And even then, the union had to resort to a procedural maneuver after skilled tradesmen voted down their portion of the contract by 69 percent to 31 percent.

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“Because a majority of UAW skilled trades members voted against the tentative hourly agreement, under the UAW Constitution, the UAW International Executive Board (IEB) investigated the reasons skilled members voted against the proposed agreement and determined that these reasons were predominantly economic and not unique to skilled trades members.  Accordingly, the IEB declared the agreements ratified under the UAW Constitution,” the union said in a statement.

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Mopar Muscling in at SEMA

Chrysler/Fiat planning to reveal 30 “Moparized” models at annual aftermarket show.

by on Oct.26, 2011

Mopar will give the Dodge Challenger a Viper ACR makeover for SEMA.

For those who’re wondering what all those little econo-cars are doing at this year’s SEMA Show, don’t worry.  The annual aftermarket extravaganza hasn’t abandoned the muscle that normally covers the wide aisles of the Las Vegas Conventional Center.

Chrysler and its Italian partner Fiat, for one thing, plan to fill their floor space with 30 “Mopar-ized” models this year, including a Mopar-modified Dodge Challenger SRT8 ACR and the Chrysler 300 SF6.

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“The aftermarket is a $34 billion-a-year industry and SEMA is the perfect place to showcase everything that Mopar has to offer,” said Pietro Gorlier, President and CEO of Chrysler’s service, parts and customer care division.

Long operating in the shadows, Mopar is making a move into the limelight, both by expanding its catalogue of parts and accessories and, starting with the 2010 Dodge Challenger Mopar ‘10, a limited edition muscle car, putting its name on a series of limited-edition performance machines.

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Ford “Core…Remains Strong” Despite Profit Dip

Mulally downplays modest decline.

by on Oct.26, 2011

Ford CEO Mulally with the new Focus ST.

Ford Motor Co. earnings dipped slightly during the third quarter, triggering a modest sell-off by investors despite company assurances that it’s only a temporary setback – CEO Alan Mulally insisting insisting Ford’s “core…remains strong.”

Ford posted earnings of $1.6 billion, or 41 cents per share, for the July – September quarter, a $38 million, or 2 cents per share – dip from year-earlier levels.   The decrease reflected higher raw material prices, the costs of new product launches and a dip in profit margins on new vehicles.

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Even so, chief executive Alan Mulally said Ford continued to strengthen its balance sheet, invest for future growth, as well as take actions to improve its competitiveness

“We delivered solid results for the third quarter despite an uncertain business environment,” Mulally said, arguing that, “The core of our business remains strong.”

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First Drive: 2012 Kia Rio Hatchback

First mainstream use of gas-saving Stop/Start technology.

by on Oct.26, 2011

The 2012 Kia Rio 5-door matches its mileage numbers with a distinctive design.

Long an afterthought in the American marketplace, Korean carmaker Kia is rapidly emerging from the shadows of its better-known sibling Hyundai.  And the 2012 Kia Rio hatchback is proof why.

This impressive new entry into the fast-growing subcompact segment is the maker’s latest to get 40 miles per gallon on the highway out of its direct-injected four-cylinder engine.  Give some of that credit to Kia’s introduction of breakthrough Stop/Start technology that can boost fuel economy as much as 5% — the first time this system has been offered in a mainstream U.S. product.

But while mileage may today be one of the first boxes buyers check when shopping for a new car, there are other key factors in the decision process and Kia comes to the front there, as well.

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Stylish on the outside and roomy on the inside, the new Rio is the handiwork of Kia’s Southern California styling center, which has done a first-rate job on the overall re-design.   Anyone who hasn’t check out the new look of the brand, in recent years, will be in for a shock at what has been accomplished by Kia’s design chief Peter Schreyer – who was responsible, in a past life, for Audi’s bold look.

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