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FCA Sees Sharp Slide in US Q3 Net Income

Recalls take their toll on earnings.

by on Nov.05, 2015

FCA ordered a major recall in July when hackers were able to take control of a Jeep.

The U.S. has been the cash cow for Fiat Chrysler Automobiles since the trans-Atlantic was formed in 2009, but things took a severe turn for the worse in the latest quarter.

Net income at FCA’s U.S. operations plunged 89% during the July-September quarter, to $70 million compared with $611 million a year earlier. That was one key factor behind the overall $330.4 million loss Fiat Chrysler reported for the third quarter.

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Fiat Chrysler US reported a $1 billion one-time charge on Thursday, including a $159 million of the pretax charge covered damage to FCA vehicles during the devastating series of explosions that devastated the port in the city of Tianjin, China in August.


Infotainment Systems are the Plague of the Auto Industry, Says Consumer Reports

Japanese makers retain lead in quality, reliability.

by on Oct.27, 2014

CR gives thumbs up to the Toyota Camry, the magazine predicting good reliability for the 2015 update.

The quality of the cars sold on the U.S. market has hit a plateau, and motorists can put the blame on new technologies – especially the infotainment systems that have become increasingly common on today’s models, according to a new study by Consumer Reports.

The influential non-profit publication likened the issue to a “reliability plague,” chief auto tester Jake Fisher noting that, if anything, the latest annual Consumer Reports Automotive Reliability study might be downplaying the problem because it reports only actual defects.

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The situation would be even worse if the study included complaints about just how difficult many infotainment systems are to operate.

“The big problem is infotainment. Take that out and (the quality of) cars would be improving,” said Fisher, during an appearance before the Detroit Automotive Press Association.


Is This Buick’s New Convertible?

GM offers tease of new Vauxhall Cascada.

by on Sep.07, 2012

The first new midsize convertible for Vauxhall since the 1930s might also become a new droptop in the Buick line-up.

There are some definite benefits to going global, especially if you’re a small brand long starved of product.  So is the case with Buick, which not all that long ago had to suffer through life with just three aging product lines but is now rapidly fleshing out its showroom.

And there are signs that the next model to come aboard will be a Buick droptop.

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That, at least is the speculation surrounding what will first appear in the form of the Vauxhall Cascada Convertible.  Though not scheduled for showing at the upcoming Paris Motor Show, General Motors is offering up a teaser image of the new droptop – perhaps to offset growing calls for the maker to sell off its money-losing Opel/Vauxhall subsidiary and show there really is a turnaround plan in place.

(For more on that story, Click Here.)

But why should Buick celebrate?


First Look: 2013 Nissan Sentra

Lighter, more lavish, more fuel-efficient.

by on Aug.31, 2012

The 2013 Nissan Sentra is 150 pounds lighter - yet also larger -- than the outgoing model.

Didn’t we already see Nissan’s new midsize sedan? Well, yes – and no.  The Japanese maker continues its unusual strategy of offering two entries into this critical market segment, starting with the all-new Altima it introduced earlier this year.

Now comes Nissan’s second model, the 2013 Sentra.  Technically a compact, according to EPA guidelines, it’s close enough in size to appeal to many midsize buyers on a budget.  Though the traditionally down-market entry, Nissan is making the sort of styling and feature changes that it hopes will convince potential buyers that the new Sentra isn’t just a roomy econobox.

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As with the Altima and the other big entry for 2013, the Pathfinder ute, the redesigned Altima follows Nissan’s so-called “class-above” strategy.  That starts with a more premium design than the outgoing model.  The basic look will be familiar to those who’ve already seen the new Altima, starting with the trapezoid-shaped Nissan grille framed with large headlamps and LED accent lights – normally a luxury car detail. The standard taillights are LED, as well.


Fuel Prices Nudging Up Again…So is Mileage

Are consumers fickle about fuel costs?

by on Aug.06, 2012

After a slight spring decline, sales of high-mileage models like the Chevrolet Malibu Eco seem to be regaining momentum.

There seems to be an almost direct correlation between fuel prices and fuel economy, at least in terms of the mileage of the vehicle the average American motorist has been purchasing this year.  And with fuel prices once again starting to rise after unexpectedly tumbling for several months that means fuel economy is heading up, as well.

After a three-month drop, fuel economy of all new vehicles sold in the United States leveled off in July, according researchers at the University of Michigan Transportation Research Institute.   Mileage hit an all-time record in April as U.S. fuel prices started racing towards record levels, as well.

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For July, unadjusted Corporate Average Fuel Economy, or CAFE, performance was 29 mpg, the same as in June and an increase of 17%, or 4.3 miles per gallon, since October 2007.


Chrysler More than Doubles Q2 Earnings

Make could “overshoot” profit target for 2012, says Marchionne.

by on Jul.30, 2012

Good news from Chrysler today for CEO Sergio Marchionne but things aren't likely to be so rosy when partner Fiat reports earnings on Tuesday.

Chrysler Group LLC reported a 141% improvement in its adjusted net income during the second quarter and a 23% increase in revenue over last year’s levels.

The company said preliminary second-quarter financial results, including net income of $436 million, show an $806 million improvement from the $370 million net loss in the same quarter last year, which had included a $551 million charge related to repayment of its government bailout loans.

Excluding the charge, net income increased $255 million, or 141%, period over period, as the company continues to achieve its business targets and improve sales across all brands, Chrysler said. The maker repeated earlier guidance saying it remains on track to report net earnings of $1.5 billion for all of 2012 – and an operating profit of $3 billion.

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“Our results reflect a tireless pursuit by the people of Chrysler Group to deliver the very best quality and value across our brands,” said Sergio Marchionne, Chrysler Group LLC chairman and chief executive officer, who now expects the automaker’s profits to exceed $1.5 billion for the full year. “Together, we are always striving to achieve more, to learn from the past and build upon our successes.”


U-Michigan Team Shines to Victory in Solar Challenge

College team claims fourth consecutive victory.

by on Jul.23, 2012

The University of Michigan's solar car Quantum heads to victory in the 2012 American Solar Challenge.

A team from the University of Michigan shined – quite literally – in the 2012 American Solar Challenge, a sun-powered race the school won for the fourth consecutive year.

The U-M team led the race by as much as 10 hours, going into the final stretch of the 8-day event, which began in Syracuse, New York and wrapped up in St. Paul, Minnesota.  In all, the university has claimed victory seven times since the American Solar Challenge was first launched in 1990.

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The school’s solar-powered car, dubbed Quantum, took 45 hours of actual driving to make the journey, using the energy from the sun to average just under 40 miles per hour.  The vehicle was a modified version of the solar racer that helped the school win third place during the World Solar Challenge in Australia last year.


Honda Cuts Shipments of Cars from Japan to U.S.

Maker losing money on models like Fit, CR-Z, Insight.

by on Jun.12, 2012

Honda plans to export the Fit subcompact from China to Canada -- at least temporarily.

Honda is cutting exports of the Japanese-made Fit to U.S. dealers because of lopsided exchange rates.

Crushed by lopsided dollar/yen exchange rates, Honda is cutting back on exports from Japan to the U.S., even though that will curb potential sales and market share growth, the maker’s CEO says.

The maker hopes to offset those reductions by ramping up production in the U.S. and other parts of North America.  Honda recently broke ground in Mexico for a new plant that will supply American dealers with the subcompact Fit and possibly other products.

“Under the current exchange rate of 80 yen per dollar, our export business doesn’t make any profit,” Honda Motor Co. CEO Fumihiko Ike told the trade publication Automotive News. “Definitely, the absolute number of exports to the United States will be decreasing.”

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Honda is by no means the only Japanese maker to curb exports to the U.S. as a result of the weak dollar.  And European makers, including BMW and Audi, have also curtailed exports due to lopsided exchange rates – though with the Euro sliding the gap has narrowed in recent weeks for German and other Continental manufacturers.


Tougher Teen License Requirements Could Save 100s of Lives

Restrictions could cut deaths in some states by 50%, says insurance group.

by on Jun.01, 2012

Night time is the wrong time for teenage drivers.

Emergency crews struggle to save teens involved in a nighttime accident.

Motor vehicle crashes are the leading cause of death for U.S. teens, according to government statistics, but a new insurance industry report suggests the numbers could fall sharply by tightening restrictions on teen driver laws.

Among teens, auto crashes are responsible for one in three deaths each year, reports the Centers for Disease Control, but the new study by the Insurance Institute for Highway Safety projects that at least 500 lives could be saved annually by the use of more restrictive licenses.  In some states, the IIHS said, it expects the fatality rate among teen drivers to fall by as much as 50%.

The new study points out what it calls best-practice policies enacted by various states, including a ban on carrying teen passengers, limited night driving and a requirement for supervised driving.

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“Even the best states can do better,” says Anne McCartt, the senior vice president for research at IIHS. “There’s room for improvement across the board, and states could see immediate reductions in fatal crashes and collision claims as soon as the beefed-up provisions are in force.”


Designers Put Tomorrow’s Cars on a Diet

Customers want more but mileage rules demand less.

by on May.11, 2012

Whether battery cars, like the Chevy Volt, or more conventional products, cutting weight and improving aero are two critical challenges for designers.

Bigger is better.  It’s been the automotive mandate since the days of Henry Ford.  And with rare exception, that’s precisely what automakers have delivered, vehicles that grow bigger and heavier with every new generation.

But driven by consumer demand for better mileage – and rapidly rising federal fuel economy standards – the push is now in the other direction.  According to many experts, the cars we drive will be substantially smaller and lighter by the end of the decade.

But the process isn’t as simple as it might seem, especially in the U.S., where people equate size with luxury.  Complicating matters, Consumers expect more features and more and more safety equipment,” said General Motors designer Bob Boniface, and even that little CD changer built into the dash adds five pounds of mass.

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Boniface was one of three designers invited to a panel addressing the subject of “lightweighting,” the challenging effort to deliver more of what customers want – and what government regulations require – while somehow lowering the mass of tomorrow’s automobiles.

Ford, for example, has set a goal of trimming as much as 750 pounds off the weight of future models.  And other manufacturers have set similar goals.  But getting there isn’t easy and will depend on some creative solutions from the industry’s designers and engineers.