Prius recall puts Toyota troubles into overdrive 9 Feb 2010 The gas pedal fault has already erased close to Ford's market cap from the Japanese automaker's valuation. Its iconic hybrid's brake woes make Toyota's quality problems look endemic. The company's recent estimate of a $2 bln oneoff hit is rapidly fading in the rearview mirror.
Toyota backlash has whiff of protectionism 4 Feb 2010 The Japanese firm needs to fix its faulty cars fast. But reaction looks overblown including a call from the U.S. transport secretary, later rescinded, to stop driving Toyotas. It's hardly the first automaker to issue a mass recall. And the fault may lie with a U.S supplier.
Tesla IPO looks racier than its Roadster 1 Feb 2010 Outsourcing problems mean the lossmaking electric sportscar maker could soon face a year's hiatus in vehicle sales. Sure, Tesla has a habit of confounding skeptics, and its green credentials make it a trophy buy. But the firm's finances may be too volatile for many investors.
Ford shares priced for absolute perfection 28 Jan 2010 Back out the group's nonauto assets from liabilities and investors value the car business at $52 bln. Ford avoided bankruptcy, boosted market share and posted its first annual profit since 2005. But to justify its valuation, Ford needs to prove its rebound has staying power.
Toyota gives Detroit an opening — and a warning 27 Jan 2010 The glitch that forced the Japanese carmaker to halt sales of 63 pct of its U.S. fleet should benefit Motown rivals. But shared platforms exacerbated Toyota's pain. With the Big Three making greater use of the costsaving measure, they may want to invest more in quality control.
Porsche lawsuit could put Deutschland AG on trial 26 Jan 2010 Short positions in Volkswagen proved costly in October 2008 when the shares soared on the revelation that the float was mostly controlled by rival Porsche. Some hedge funds are suing Porsche for fraud. Even if they don't win in court, the case against German governance is strong.
Chinese carmakers take ground with Saab and Volvo 23 Dec 2009 BAIC's $200 mln deal for Saab technology looks tiny. But it could save the Chinese car group years of development and generate substantial revenue. Geely's $2bn interest in lossmaking Volvo is more of a gamble. Still, both moves show the competitive threat of China's automakers.
VW/Suzuki tie-up is a smart move by both sides 9 Dec 2009 Volkswagen is paying $2.5 bln for 19.9 percent of Suzuki. The German carmaker gets strategic access to its Japanese peer's smallcar expertise and Asian markets, while Suzuki enjoys a needed cash boost. VW can't afford a full takeover just now. But this is a wise interim move.
China’s automakers may run out of gas 9 Dec 2009 China's passenger cars sales almost doubled in November, thanks to major government incentives but these will be hard to replicate next year. Investors in automakers such as Geely, whose shares have increased more than sevenfold in a year, may have got ahead of themselves.
MAN shareholders should be wary of Scania merger 7 Dec 2009 Shares in German truckmaker MAN have weakened after several boardroom departures. The fear is that Ferdinand Piech, who chairs MAN as well as its lead shareholder VW, may now push for a tieup with rival Scania. A deal may be better for VW than for MAN's other investors.
GM right to give way in Chinese JV 4 Dec 2009 Ceding control in its venture with SAIC is not the climbdown it seems for the U.S. carmaker. The payoff, a new venture to target India, looks worth it. GM retains exposure to Chinese growth while getting a financially potent ally for new markets.
Peugeot strives for global reach with Mitsubishi 3 Dec 2009 The French carmaker, a small global player, is talking about closer ties with struggling Mitsubishi. It doesn't sound like a worldbeating combination, but the Japanese company's electric technology is a lure and Peugeot needs to get global economies of scale somewhere.
GM’s new CEO must be jack of all trades 2 Dec 2009 Fritz Henderson's successor needs some restructuring savvy. The ideal candidate also needs to bring fresh ideas, be a cheerleader and a realist, be able to handle a strong board with an independent bent and the US govt and be willing to wait for a payoff. Good luck with that.
GM needs to explain why it’s replacing its driver 1 Dec 2009 Removing Fritz Henderson as CEO may be a good thing. He was part of the old guard who drove the company into bankruptcy. As Fiat and Ford have shown, new blood from outside the industry helps power a turnaround. But the lack of an explanation from GM sends a worrying signal.
GM’s loan repayments are a PR stunt 16 Nov 2009 But they are still welcome. Sure, the carmaker is still losing money. But it s a much healthierlooking company with a surfeit of cash and paying back the US, Canadian and German governments will cut costs. Returning all taxpayer aid, though, remains a pipedream.
AIG pay standoff entirely predictable 11 Nov 2009 It s what happens if a government props up a private company, makes a show of keeping it running like one, and then interferes. CEO Benmosche s threat to quit may be a bluff. But the lesson is that if there s no clear turnaround plan firms should be wound down, not bailed out.
Marchionne’s Chrysler blueprint needs a road test 5 Nov 2009 The Fiat boss s plan to take the Motown carmaker out of the wrecker s yard sounds promising. His success in Turin gives him some credibility. But like his statement that the unprofitable firm has boosted its cash by $1.7bn, Marchionne s vision must do more than stand up on paper.
GM can get to work on Opel restructuring 4 Nov 2009 The US carmaker has scrapped the sale of its European division to Canada s Magna after Brussels questioned German state support for the deal. Angela Merkel will be irked. But GM can now aggressively restructure the struggling subsidiary with less political meddling.
Ford adds capital icing to earnings cake 2 Nov 2009 The Motown carmaker followed up its $1bn earnings surprise with a deft bit of balance sheet restructuring. Ford hopes to raise up to $3bn of new capital while also paying back almost as much debt. That should add confidence the firm is properly planning for longterm success.
US pay tsar plays with fire 22 Oct 2009 Ken Feinberg will soon unveil his plan to limit pay at Tarpdependent firms. With the best intentions, there could be damaging unintended consequences, like skewed incentives and mass defections potentially creating a mess. Let's hope Feinberg has asked the right questions.