MOTOR

GM shows commitment to Opel with 4 bn euro investment

General Motors will invest four billion euros ($5 billion) in its troubled German subsidiary Opel and British sister brand Vauxhall by 2016, the US auto giant’s chief announced Wednesday.

“As a global automotive company, GM needs a strong presence in Europe, in terms of design and development as well as manufacturing and sales,” GM chairman and chief executive Dan Akerson said at Opel headquarters in western Germany.

“Opel is a key to our success and enjoys its parent company’s full support,” he added. The investment aimed to allow Opel and Vauxhall to return to growth in the medium term and improve Opel’s market share in Europe, currently at just over six percent, he said.

It would also permit Opel to launch 23 new models and 13 new powertrain systems by 2016.

Opel is “on the right track” in its restructuring plan as well as its aim to balance its books by mid-decade, Akerson told gathered Opel chiefs, local politicians and workers.

The German carmaker has been making losses for years as it has been slow to react to the crisis in demand for cars in Europe, by far its biggest market, and GM has ordered Opel’s management to prescribe draconian cost-cutting. The 10-year turnaround plan, dubbed DRIVE!2022, which included a wage freeze, the giving up of some fringe benefits and other cost-saving measures, was approved at the end of February by three of Opel’s sites in Germany but not at its northwestern Bochum factory.

Last month Opel said it would press ahead with plans to phase out auto production at Bochum at the end of 2014, earlier than its planned end-2016 date.

GM estimates it stands to lose more than $1.5 billion on its European operations this year and wants to steer Opel and Vauxhall back to profit by 2015. “Those cars can be sold outside Europe if it makes sense,” Akerson said, amid insistent calls by workers who have reproached the US giant for its strategy of confining sales to Europe for too long.

Akerson, who continues his visit in Germany by meeting Chancellor Angela Merkel in Berlin on Thursday, added it was “a time of challenge but also of excitement and optimism”.

Standing alongside him, Opel’s new chief executive Karl-Thomas Neumann vowed to return the troubled German carmaker to strength and its “former glory”, commenting “Opel is back”.

AFP

Yamaha plans $500 bike in India, eyes exports to China

Japan’s Yamaha said it was developing “the world’s cheapest motorcycle” in India priced at $500, which it plans to export to other markets including China.

The low-cost bike with an engine size of around 100cc will be worked on at its research centre in Uttar Pradesh state, but the company declined to give a launch date.

“Developing the product in India will give us substantial cost advantage and enable us to price it competitively,” Hiroyuki Suzuki, chief executive of India Yamaha Motor told reporters in New Delhi.

The bike will be sold first in India and then exported to Latin America, Africa and the “factory to the world” China -- usually the source of low-cost manufactured goods.

“Our target is to develop the cheapest bike at around $500 for both in India and export markets,” said senior Yamaha research and development manager Toshikazu Kobayashi.

Analysts see Yamaha’s move as part of a strategy to target commuters in India having previously focused on producing sporty and performance-led bikes. Yamaha currently produces 400,000 units in India, with a target of one million by 2014.

But some analysts had doubts about a cheap bike meant for Chinese consumers.

“China already has cheap gas or electric-run bikes, often priced very cheap,” analyst Mahantesh Sabarad of Fortune Equity Brokers said.

Rival Bajaj Auto has also introduced low-cost variants for export to other Asian countries, analysts said.

Sales in India’s once-booming motorcycle market touched 10.08 million units in the fiscal year to March 2013, up just 0.12 percent year-on-year as low consumer spending and high-interest rates hit sales, industry data showed.

AFP

Jaguar Land Rover posts record

British luxury car brand Jaguar Land Rover, owned by India’s Tata Motors, said global sales in March climbed 16 percent from a year earlier to hit a record level, boosted by Chinese demand.

Jaguar Land Rover (JLR) reported sales in March rose to 53,772 units internationally, with sales for the January to March quarter also at a record high of 115,504 units.

JLR sales in China for March rose 22 percent to 8,487 vehicles while in Britain they grew 14 percent to 17,784 units, the statement said.

“Jaguar Land Rover has globally delivered its strongest ever monthly and quarterly performance,” said Phil Popham, JLR group sales operations director.

Both Jaguar and Land Rover have introduced new models and engines in recent months.

Sales of the cars have been key growth drivers for the India’s Tata Motors, part of the giant tea-to-steel Tata conglomerate, in recent quarters.

Tata Motors bought Jaguar and Land Rover from Ford Motor in 2008 for $2.3 billion as part of plans to expand its reach beyond Asia.

AFP

Flap-backed lorries to save lives, energy in Europe

Rolling out round-nosed lorries with aeroplane-style flaps at the back on Europe’s roads would cut fuel costs, reduce carbon emissions and save lives, while giving a boost to the struggling auto sector, the European Commission said Monday.

“A brick is the least aerodynamic shape you can imagine, that’s why we need to improve the shape of our lorries on the roads,” said Transport Commissioner Siim Kallas, calling for a change to 1996 specifications for heavy goods vehicles.

Brussels argues that aerodynamic lorries would cut fuel-guzzling and greenhouse gas emissions by up to 10 percent while improving a driver’s field of vision, saving hundreds of lives of vulnerable road users such as cyclists and pedestrians.

A typical long-distance lorry covering 100,000 kilometres (60,000 miles) a year would save 5,000 euros in fuel annually, Kallas said. So the new rounded trucks would be particularly profitable for the one million -- of the 6.5 million on Europe’s roads - that regularly travel long distances.

With road transport accounting for more than 70 percent of inland freight in Europe, a change in the specifications would also “give European manufacturers a head-start in designing the truck of the future,” Kallas said.

The EU executive’s proposal must be adopted by the European Parliament and the 27 European Union members before becoming law, meaning the new trucks could be on roads by 2018-2020 if the rules are agreed.

The proposals made no mention of allowing so-called ‘gigatrucks’ or ‘megatrucks’ -- somewhat like Australia’s fabled road-trains which can have two or even three trailers in tow. Kallas last year said the use of longer vehicles was a matter for each member state.

AFP

China March auto sales hit record high

China’s auto sales rose more than 10 percent year-on-year record monthly high of 2.04 million vehicles, an industry group said Thursday, citing strong demand for passenger cars. In the first quarter, automakers sold 5.42 million vehicles in the world’s largest car market, up 13.2 percent year-on-year, the China Association of Automobile Manufacturers (CAAM) said in a statement.

“Auto production and sales entered the traditional peak season in March,” the group said.

“Sales of passenger vehicles showed relatively fast growth, which was the major driving force for overall growth in auto sales from January to March.” Sales of passenger cars alone jumped 17.2 percent from a year earlier to 4.42 million units in the first quarter, the group said. In March alone, sales rose 13.3 percent year-on-year to 1.59 million units. Last year, China’s overall auto sales rose only 4.3 percent year-on-year to 19.31 million units, hurt by limits on numbers imposed by some cities to ease traffic congestion and cut pollution.

The group said sales of Japanese brand passenger cars dropped 16 percent from a year earlier in the first quarter, hurt by the lingering impact of a territorial row between Beijing and Tokyo that triggered anti-Japanese protests.

But sales of other foreign manufacturers all rose, with German, South Korean and French brands each surging more than 30 percent in the first three months of the year, it said.

AFP

French car sales fall 14% in first quarter

Sales of new cars in France fell by 14 percent to 525,693 vehicles during the first quarter, the slowest start in five years, trade data showed.

Figures from the association of French car manufacturers association showed that the drop accelerated in March, dropping by 16.4 percent on a 12-month comparison to 165,244 vehicles. French car manufacturers were harder hit than foreign brands in the January - March period, with sales down 14.4 percent overall to 291.646 vehicles.

Renault saw its car sales drop 11.1 percent to 134,538 vehicles and PSA Peugeot Citroen by 16.9 percent to 156,720 vehicles in the first quarter.

Sales of foreign cars dropped 13.4 percent to 234,047 vehicles in January through March, based on car registration data.

Car sales have been hit hard as French economic growth has stalled. After a 0.3 percent contraction in gross domestic product in the final quarter of 2012 due in large part to the first decline in household purchasing power since 1984, the French economy is expected to stagnate at the beginning of this year.

Czech car output falls 18% in first quarter

Production of cars in the Czech Republic, the EU’s fifth-ranked car maker, fell by 18.14 percent in the first quarter of this year compared with the same period in 2012, trade data showed on Wednesday.

Czech auto plants produced 285,715 cars in January through March, said the Automotive Industry Association.

Vehicles made by the Volkswagen unit Skoda, South Korea’s Hyundai, and TPCA, a Toyota joint venture with PSA Peugeot Citroen of France, account for more than 20 percent of the country’s total industrial output.

Last year, they turned out nearly 1.2 million passenger cars, down 1.7 percent from record-high output in 2011.

Heavily dependent on car production and exports to western Europe, namely EU powerhouse Germany, the Czech economy has been stuck in recession for a year and is not forecast to recover until next year.

AFP