GM takes another stake in a biofuel company

Sun May 04 02:56:12 PDT 2008

By John Crawley

WASHINGTON, May 1 (Reuters) – General Motors Corp is taking another stake in a company focused on developing ethanol from sources other than corn, the automaker said on Thursday.

Mascoma Corp is testing its process for converting biological wastes — plant matter, grasses, wood chips and other non-grain sources — to fuel. It expects to start producing ethanol later this year at a demonstration plant in New York state.

There is growing concern among international aid groups and others that diverting a sizable percentage of America’s corn harvest for ethanol production has helped to drive up crop and food prices.

In January, GM announced it was taking a stake in Coskata Inc of Warrenville, Illinois, a biofuels company looking at sources of energy including garbage, old tires and plant waste.

"These investments in leading edge firms supports belief that ethanol has the greatest near-term potential as a clean-burning, renewable fuel that can help reduce oil dependence," GM President Fritz Henderson said in announcing the Mascoma deal.

Henderson would not disclose the size of the equity stake in Boston-based Mascoma, which is privately held. Mascoma said its technology is designed to produce ethanol more efficiently and at lower cost.

President George W. Bush has promoted producing ethanol from cellulose sources like crop wastes and grasses as an alternative to grain, but some critics say it will take years to bring it to market.

U.S. gasoline prices are at all-time highs, prompting automakers, already under pressure from the government to make more efficient vehicles, to consider more ways to conserve fuel.

More than three million GM cars and trucks on U.S. roads are "flex-fuel" capable, meaning they can run on either gasoline or an ethanol/gasoline blend, called E85.

But there is little infrastructure in the United States to deliver ethanol and other alternative fuels to most consumers so most "flex-fuel" vehicles run on straight gasoline.

GM is also developing an electric vehicle, the Volt.

Consumer preferences, seen in declining U.S. sales for Detroit-based auto manufacturers, is continuing to shift from truck-based sport utilities to more fuel-efficient, smaller designs.

Congressional negotiators trying to complete a new farm bill are proposing to reduce a tax credit for producers of corn-based ethanol and create one for those that make cellulosic fuel.

(Editing by Tim Dobbyn)

Provided by Reuters

© Reuters 2008 All rights reserved

GM U.S. sales down an adjusted 22.7 pct in April

Sun May 04 01:48:37 PDT 2008

DETROIT, May 1 (Reuters) – General Motors Corp on Thursday reported a 22.7 percent fall in April U.S. auto sales on an adjusted basis, led by a 32 percent decline in truck sales.

GM’s overall sales fell to 260,922 vehicles in April from 311,687 in the same month a year earlier. The percentage fall was adjusted to reflect two more selling days last month compared with April 2007.

Inventory fell to about 824,000 vehicles at the end of April, down about 206,000 vehicles from a year earlier to the lowest level since September 2005.

GM said a two-month-old strike at supplier American Axle & Manufacturing reduced the automaker’s April production by about 130,000 vehicles.

(Reporting by Soyoung Kim; editing by John Wallace)

Provided by Reuters

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Nissan CEO: US market to stabilise at best in 09-10

Sun May 04 01:03:56 PDT 2008

(Adds comments, background)

CASCAIS, Portugal, May 1 (Reuters) – Nissan Motor Co Chief Executive Carlos Ghosn said on Thursday that the U.S. auto market could stabilise in 2009-2010, but the industry would rely mostly on emerging markets to expand.

"Japan at best will see stagnation, West Europe at best stagnation, the U.S. is slumping in 2008 and at best in 2009-2010, we will see stabilisation," he told a news conference.

"The growth will come from emerging markets."

Ghosn, also head of Nissan’s majority shareholder Renault SA , repeated that the two companies remained open to expanding their alliance to a third member but that they were in no rush.

"An alliance in North America would make sense," he said, reiterating a stance that first emerged when billionaire investor Kirk Kerkorian suggested a three-way union to include troubled General Motors Corp two years ago.

More recently, the questions have turned to whether Nissan could expand its ties with Chrysler LLC after they signed a deal this month to supply each other with vehicles.

"Our alliance (Nissan-Renault) is already 7 million vehicles a year, which is a good size. There is no urgency. I am not hunting. It would be an opportunity," Ghosn said.

"The thing with Chrysler is an OEM (original equipment manufacturing) deal. Of OEM deals, there will be more."

Nissan, Japan’s third-biggest automaker, is due to announce on May 13 a new midterm business plan spanning the next five years.

Ghosn declined to give any details, but indicated that Nissan was ready to enter the next phase of growth after spending the last decade fixing its finances and making up for lost time as healthy rivals kept on with technological advancements.

"The period of revival, of re-engineering, of retooling is finished. The company today is ready to compete on (an) equal footing with any company, in particular on technology."

Ghosn said the alliance was in talks with "a Gulf state" about introducing its electric car in the country, after signing similar deals with Israel and Denmark.

(Reporting by Marcel Michelson; Writing by Chang-Ran Kim; Editing by Hugh Lawson)

Provided by Reuters

© Reuters 2008 All rights reserved

Volvo’s 2020 vision: The injury-proof car

Sat May 03 21:51:31 PDT 2008

By Sarah Edmonds

GOTHENBURG, Sweden, May 1 (Reuters) – The destruction of the orange sedan with its slapdash paintwork may have been intentional but it was far from wanton. It was all part of Volvo’s bid to create an injury-proof car by 2020.

While that vehicle of the future may lack the self-awareness of the crime-fighting Trans Am in 1980s TV series Knight Rider, experts say it will be able to steer, brake and find out about the road ahead from within a vast electronic bumper.

And if all goes according to plan, its driver and passengers will escape even the most serious crash unhurt.

Volvo is far from the only player in what Claes Tingvall, the Swedish road administration’s head of traffic safety, calls the biggest revolution in the auto industry since the seatbelt.

Automakers, parts suppliers, governments and global agencies from the United Nations to the OECD are all looking at ways to relegate to memory the roughly 1.2 million deaths and 50 million injuries caused by motor vehicle crashes each year.

But in what some analysts see as a bid to hold its lead in consumer perceptions of safety, the Swedish carmaker now owned by Ford is the first to set a target date to eliminate death and injury in its cars.

"I think if you look into the future, we as a community will not accept that we have injuries," said Jan Ivarsson, leader of the Volvo safety team with specialists in everything from biomechanics to engineering to behavioural science.

"We have other things that are important in life."

While Volvo is working on pedestrian safety as well, the 2020 goal centres on those inside its vehicles.

Tingvall, who is a force behind the Swedish government’s own plan to stop traffic deaths through better infrastructure, doubts Volvo’s target is fully achievable but said even a tenfold reduction in injury rates would yield dramatic benefits.

Borrowing principles from industries like aviation, the matrix of systems Volvo and other carmakers are working on will interact to start crash prevention and mitigation hours, rather than milliseconds, before impact.

Continued…

CREATIVE DESTRUCTION

Which brings us back to the orange sedan, its nose crushed pug-small after powering down a tunnel at 35 miles an hour into an 850-tonne steel-encased block, at what analysts say is one of the most advanced crash-test centres in the world.

The Gothenburg complex’s moveable crash block and two 150-metre tunnels, including the only rotating test tunnel in the industry, allow Volvo to simulate everything from a head-on smash into a bus stop to a 90-degree vehicle-to-vehicle impact.

The rotating tunnel can also reverse and shoot a car outside, into the rock face or the pond behind the centre.

As with many of the 400 crashes staged there each year, the test of a new engine configuration on the orange S80 — orange shows up well on video — took two weeks to set up, will take another two to analyse and was over in a 10th of a second.

It was filmed from all angles, including a glass-topped pit below, while sensors and painted rulers on the car, crash block and dummies yielded scores of measurements.

Volvo’s Ivarsson said the two male biomechanical measurement devices — we know them as crash-test dummies — would have walked off, if they could, with little more than bruises and broken ribs from what was by any gauge a significant smash.

Still, crash tests are only part of the puzzle.

The 20-member safety team also gathers real-world data from governments, insurance firms and, with a crash-site unit on 24-7 call, conducts its own field investigations into the causes of collisions and how they could have been prevented.

Continued…

BRAND SHAKE-UP

Christian Mueller, industry consultant at analysis firm Global Insight, believes Volvo needs the tonic of the 2020 goal.

The Swedish carmaker once sat comfortably at safety’s apex. Besides the three-point seatbelt invented by its then head of safety in the late 1950s, the firm also pioneered crumple zones, side impact air bags and rear-facing child seats.

It became emblematic of the U.S. "soccer mom" of the 1990s, who sought the steel cage to keep her children secure, and of Europe’s middle class who liked its solid predictability.

As recently as January, some 77 percent of U.S. consumers polled by Consumer Reports ranked Volvo as the safest car brand.

"No other brand dominates a category the way safety is owned by Volvo," said Jeff Bartlett, Consumer Reports deputy online auto editor and author of the car brand perception survey.

But other carmakers have learned safety sells and are burnishing their own safe credentials, leaving Volvo with what Mueller calls a "huge" brand perception problem.

"Being safe is not any more the outstanding quality of Volvo because I can go elsewhere and I can buy a car that’s equally as safe," he said.

There are signs this is getting through to consumers. A survey this year of German drivers by magazine Auto Motor und Sport gave Mercedes the edge on safety, although polls by partner magazines in France, Spain and Italy put Volvo on top.

"I think the competition must certainly be felt by Volvo but clearly they’re aiming to hold onto this lead in brand perception," Bartlett said.

The automaker already offers ignitions that won’t operate if a driver is intoxicated, sensors that assess alertness and sound an alarm if the driver is dozy or drifting, and Global Positioning Systems to help prevent drivers from rushing to their destinations.

Should all this fail to avert a crash, the car takes steps such as tightening its seat belts and priming air bags to minimise injury.

The car of the future will have even more foresight.

Radar, sonar and other sensors will extend its so-called "deformation zone" until it becomes, in essence, a huge electronic bumper reaching out on all sides to gather information to feed back to the vehicle.

In a crash situation, where many drivers freeze, the car will be able to take over and steer or brake on its own. Reducing pre-impact speed by 15 km an hour would halve the road-death rate, according to Tingvall, so self-braking is key.

In the very long run, Volvo’s Ivarsson said, we may all drive the ultimate vehicle: the uncrashable car.

"If you have a really long perspective, I think we will not have vehicles that will crash in the future," he said. "You and I, in the future, we won’t accept that. Why should we accept that?"

(Editing by Sara Ledwith)

Provided by Reuters

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Ford to offer union workers buyouts at 2 US plants

Sat May 03 19:39:04 PDT 2008

DETROIT, May 2 (Reuters) – Ford Motor Co will offer buyouts to United Auto Workers union-represented hourly employees at plants in Chicago and Louisville, Kentucky, to try to trim its ranks, the company said on Friday.

Ford, which has been cutting production capacity to match declining market share in North America, said in late April that about 4,200 UAW workers had accepted recent buyouts it offered to all of its UAW-represented employees.

The carmaker did not say how many workers it had hoped would take the buyouts, but did say it would offer more buyouts targeted by plant or vehicles from that point. Analysts have said Ford was looking to buy out about 8,000 workers.

Ford has nearly 2,200 hourly workers at its Chicago plant that builds the Taurus and Mercury Sable sedans and another 2,100 workers at the Louisville plant where it builds the Explorer and Mercury Mountaineer SUVs.

The carmaker previously announced plans to trim production at both plants and has aimed to return to profitability in 2009.

Ford, which posted losses of more than $15 billion over the past two years, in April reported a first quarter profit in part due to a sharply narrower loss in its main North American home market.

Ford must still cope with a U.S. economic downturn that has depressed sales as well as rising gas prices that have accelerated a shift toward cars instead of large trucks that supported Ford profits in recent years.

Ford sales had fallen about 10 percent in the United States through the first four months of 2008, though sales of the Focus and Fusion cars and the Edge crossover have been relatively strong. Sales of its F-series pickups were down 15.5 percent and Explorer SUV sales were down 25 percent.

(Reporting by David Bailey, Editing by Toni Reinhold)

Provided by Reuters

© Reuters 2008 All rights reserved

Nissan to restart exports from Oppama plant-paper

Sat May 03 19:36:30 PDT 2008

TOKYO, May 3 (Reuters) – Nissan Motor Co <7201.T> will restart exports of vehicles to the United States and Europe from the Oppama plant, near Tokyo, from the autumn for the first time in five years, the Nikkei business daily reported on Saturday.

Nikkei, without specifying a source, said Nissan, Japan’s third-biggest automaker, will boost production at the plant in line with the plan to export more compact vehicles abroad.

The plant is set to produce 100,000 units per year of its fully remodelled boxy small wagon called Cube. The small wagon will be sold in Japan and some units will be exported to the U.S. and European markets, Nikkei said.

The Oppama plant, which has capacity to produce 480,000 vehicles per year, made 300,000 in 2007.

One of the factory’s two production lines is now operating in just one shift, but it will raise to two shifts from the autumn, Nikkei said.

Nissan aims to operate the plant at full capacity by 2010, the daily said.

Nissan is also planning to produce fuel-efficient cars and electric cars at the plant from 2010.

Nissan, owned 44 percent by Renault SA <RENA.PA>, estimated in March its European sales growth in the previous financial year, which ended in March, to be slightly weaker than an estimate of about 11 percent.

On Thursday, Nissan Chief Executive Carlos Ghosn said that the U.S. auto market could stabilise in 2009-2010, and the industry overall would rely mostly on emerging markets to expand.

"Japan at best will see stagnation, West Europe at best stagnation, the U.S. is slumping in 2008 and at best in 2009-2010, we will see stabilisation," Ghosn told a news conference in Portugal where Japan’s third-largest carmaker was showing its model line-up to the international media.

(Reporting by Chikafumi Hodo; Editing by Tomasz Janowski)

Provided by Reuters

© Reuters 2008 All rights reserved

Agco 1st-quarter net more than doubles

Thu May 01 03:34:01 PDT 2008

NEW YORK, April 29 (Reuters) – Agricultural equipment maker Agco Corp said its earnings in the latest quarter more than doubled as sales grew by double digits in each of its regional segments, led by South America.

The company reported a first-quarter net profit of $62.3 million, or 63 cents a share, during the first quarter, compared with a profit $24.5 million, or 26 cents a share, a year before.

(Reporting by Nick Zieminski, editing by Gerald E. McCormick)

Provided by Reuters

© Reuters 2008 All rights reserved

Trane 1st-quarter profit tops expectations

Thu May 01 03:22:07 PDT 2008

NEW YORK, April 29 (Reuters) – Trane Inc, a maker of heating and air conditioning systems that has agreed to a purchase by Ingersoll Rand Co Ltd, reported better-than-expected quarterly profit on Tuesday and said it expects the Ingersoll deal to close in the second quarter.

Net earnings were $65.9 million, or 33 cents per share, compared with $173.3 million, or 84 cents per share, a year earlier, when results included income from discontinued operations.

Profits from continuing operations and excluding one-time items were 35 cents a share, 1 cent ahead of forecasts, according to Reuters Estimates.

Sales rose 6.5 percent to $1.71 billion, matching estimates. Trane said commercial and international demand helped offset weak residential markets.

Trane said global commercial sales will be weaker than expected in the second quarter and said residential sales will decline about 12 percent.

It affirmed its full-year estimate of profit from continuing operations rising 18 percent to 26 percent but said sales this year should grow 4 percent to 5 percent, 1 percentage point less than expected.

The full-year forecast is on a stand-alone basis, the company said. Ingersoll-Rand is set to report results on Wednesday.

(Reporting by Nick Zieminski, editing by Mark Porter and Gerald E. McCormick)

Provided by Reuters

© Reuters 2008 All rights reserved

ArvinMeritor posts quarterly profit

Thu May 01 03:14:57 PDT 2008

DETROIT, April 29 (Reuters) – Car and truck parts maker ArvinMeritor Inc posted a quarterly profit on Tuesday, as aggressive cost cuts offset the impact of sluggish vehicle sales in North America.

ArvinMeritor reported a profit of $20 million, or 28 cents per share, for its fiscal second quarter ended March 31, compared with a loss of $94 million, or $1.34 per share, a year earlier.

ArvinMeritor reported earnings of 37 cents per share excluding one-time items.

Revenue rose to $1.78 billion, from $1.63 billion a year earlier.

In March, ArvinMeritor had said that it expected second quarter results to be significantly better than a year earlier, with cost improvements more than offsetting adverse North American conditions.

(Reporting by Soyoung Kim, editing by Gerald E. McCormick)

Provided by Reuters

© Reuters 2008 All rights reserved

Fuji Heavy profit slides, sees tougher year ahead

Mon Apr 28 07:47:12 PDT 2008

By Chang-Ran Kim, Asia auto correspondent

TOKYO, April 28 (Reuters) – Fuji Heavy Industries Ltd, the maker of Subaru cars, reported a smaller-than-expected 4.6 percent drop in annual operating profit on Monday and forecast a big currency-driven decline this year despite growing vehicle sales.

Operating profit for the year ended March 31 was 45.68 billion yen ($437.5 million), beating a consensus forecast of 43.4 billion yen in a poll of 17 analysts by Reuters Estimates.

Net profit fell 42 percent to 18.48 billion yen, while revenue grew 5.2 percent to 1.572 trillion yen.

For the current year, Fuji Heavy, in which Toyota Motor Corp is due to nearly double its 8.7 percent stake soon, forecast a 50 percent fall in operating profit to 23 billion yen.

It sees net profit shrinking 46 percent to 10 billion yen, hit by an assumed 16-yen fall in the dollar to average 100 yen this year. Consensus forecasts put the operating profit at 28.3 billion yen and net profit at 13.9 billion yen.

"We had hoped to return to profit growth for the second year (2008/09) of our medium-term plan, but the tough currency and commodities conditions are unfortunately going to erase the effects of a sales volume expansion," Chief Executive Ikuo Mori told a news conference.

Continued…

Subaru expects to boost global car sales by 6.6 percent this year to 636,000 vehicles, backed by a big push in Europe, where it will begin selling its first diesel-powered model.

Last year, its vehicle sales grew 3.2 percent.

Fuji Heavy has struggled to gain traction over the years as rising fuel prices dampened sales of its mainly four-wheel-drive cars such as the Legacy series and B9 Tribeca sport utility vehicle.

With the race to improve environmental technology intensifying in the industry, Fuji Heavy has found a willing source of funding in Toyota, which benefits by being able to tap Subaru engineers to fill a shortage.

After replacing General Motors Corp as Fuji Heavy’s top shareholder in 2005, Toyota said this month it would raise its stake to 16.5 percent by taking over 31.11 billion yen worth of treasury stock.

As part of the deeper ties, the two companies will jointly develop a rear-wheel-drive sports car to be sold under both brands. Toyota and its minivehicle unit Daihatsu Motor Co will also supply Subaru with compact and 660cc minivehicles, with Fuji Heavy eventually quitting production of minicars — a move senior management had resisted for years.

Under a four-year business plan, Fuji Heavy aims to make an operating profit of 80 billion yen in the year ending March 2011.

(Reporting by Chang-Ran Kim; Editing by Chris Gallagher)

Provided by Reuters

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