| 1)
US EPA Certifies Caterpillar Diesel ACERT Emissions Technology |
| Situation
- EPA-certified
Caterpillar's first engine--C9
- C9
equipped w/ Advanced Combustion Emission Reduction Technology
(ACERT)
- C9
popular for emergency, recreational, refuse, dump trucks, mass
transit buses
- Full
production will begin in 1Q 2003
Significant
Points
- All
Cat engines to be equipped w/ ACERT technology by 4Q
- ACERT
also expected to meet future emissions regulations for on and
off-road diesels
Web
Source
Sourced
from: TruckingInfo.com, January 20, 2003
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2)
Court Requires Environmental Impact Statements >
From DOT Before Granting Mexican Trucks US Access |
| Situation
- Bush US DOT allowed unrestricted access to US roads in compliance
w/ trade treaties
- Lawsuit filed by environmental groups, Teamsters argued Mexican
trucks heavier polluters
- Diesel major threat to children's health, contributes to respiratory
illnesses, likely carcinogenic
- 30K+ Mexico-domiciled diesel trucks could enter US in 2003,
including many pre-1994 heavy polluters
- Trucks from Mexico will emit twice as much particulate matter,
nitrogen oxides as US trucks by 1020
Significant
Points
- US federal court stopped access, ordered full Environmental
Impact Statements and Clean Air Act Conformity be prepared
- Ruling stated US environmental laws were violated in granting
access
Web
Source
Sourced
from: TruckingInfo.com, January 17, 2003
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| 3)
Remarketing Lenders Expect Slower Spring Rebound |
| Situation
- Remarketing managers at top banks unsure of when traditional
spring surge will begin
- Last year it was fast and strong, but 2003 expected to be later
and weaker
- Changes for auctions in 2003 include more emphasis on reconditioning
- Expect more use of Internet in wholesale selling and auctions
Significant
Points
- Used-car industry off seasonal patterns following 9-11
- Last year's high prices in Jan fell to summer lull, continues
to be sluggish
- Any number of world events could quiet this spring, analysts
say, including Iraq war, gas prices, stagnant stock market
- Remarketers will rely more on certification, extended warranties
to entice buyers away from new cars
- Lower off-lease volumes put market more in hands of automakers,
captive finance companies
Web
Source
Sourced
from: AutoRemarketing, Jan. 1, 2003
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| 4)
Soft Used Vehicle Market Driving Up Fleet Lifecycle Costs |
| Situation
- Oct 2002 prices of mid-size sedans down 10% over Oct 2001
- Minivan prices down 15% except for 7-pass, rear AC models
- SUV value drop severe after 2-yrs, 70K miles except new, small
models
- Dealers buying fewer vehicles from other dealers; consignments
down
Significant
Points
- Used vehicle market very soft, likely to continue through 2003
- New vehicle sales incentives, excess availability of used vehicles
driving prices down
Web
Source
Sourced
from: Automotive Fleet, January 2003
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| 5)
US Tax Burden On Gasoline Varies Significantly By State But Short
of Historical High |
| Situation
- Federal gasoline taxes are $0.184/gal
- Hawaii gas taxes $53.5 highest; CA close 2nd at $0.504
- Alaskans pay least $0.264 w/ summer gasohol use earning $0.06/gal
credit
Significant
Points
- Gasoline cost: taxes 30%, dist and marketing 12%, refining 12%,
and crude 46%
- Average tax burden of $0.48 well below '41 peak $0.60-0.70 adjusted
- Recent state tax raises to cover underground storage tank, other
environmental costs
Web
Source
Sourced
from: The OilSpot News, January 21, 2003
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6)
Study Shows 41% Increase in Auto Accidents After Super Bowl;
Driving is More Dangerous Than New Year's Eve |
| Situation
- New research shows number of serious car crashes in US spikes
4 hrs after the Super Bowl
- 41% increase in motor vehicle collisions during hours following
the telecast
- Research done at Univ of Toronto and based on data from NHTSA
- Findings were published Jan 23 in New England Journal of Medicine
- Accident statistics used from 27 consecutive Super Bowls, from
1975 to 2001
- Research supported by Ontario Ministry of Health, de Souza Chair
in Trauma Clinical Research at Univ of Toronto and Canadian Institutes
of Health Research
Significant
Points
- Driving post-game Super Bowl Sunday is more dangerous time to
be behind the wheel than New Year's Eve
- 4,000 total collisions vs 3,000 normally
- 1,900 persons injured in those collisions vs 1,300 normally
- 24 deaths for each Super Bowl vs 17 normally
Web
Source
Sourced
from: Sourced From: Landline Magazine, January 24, 2003
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| 7)
New Models Raise Toyota, Nissan Minivan Hopes For US Sales as Minivan
Sales Slide 17% Since 2001 |
| Situation
- New Nissan, Toyota minivans tackle declining US market
- Minivan sales, off 17% since 2001, to 1.1M units
- Nissan Quest, Toyota Sienna both enlarged, embellished
- Sienna debuts in March w/ 3.3L 230 hp V-6, standard 5-speed
AT, side airbags, optional all-wheel drive
- 2nd-generation Quest, on sale this summer, "sexed up" as both
rear seat rows fold flat, gauges relocated in center panel, shift
level on dash, has 3.5L V-6
- Sienna price cut $950 to $22,955 base, Quest II to follow suit
Significant
Points
- Can rejuvenated Nissan, Toyota minivans join still-hot Honda
Odyssey in rejuicing minivan market?
- 3-row SUVs have dented minivan appeal, but ongoing "hate SUV"
crusade could give minivans boost
- Toyota, Nissan optimistic Sienna, Quest will sell more than
they ever did at 125K,80K-85K a year, respectively
- Quest's sales after year off market will be key for Nissan,
since new edition has curviest styling ever on usually boxy minivan
Web
Source
Sourced
from: Chicago Tribune, January 19, 2003, Page 18
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| 8)
Michelin Develops Radio Frequency Tire Identification Technology |
| Situation
- Michelin developed radio frequency identification transponder
in tire that stores vital information
- Tire ID number can now be associated with VIN making tires uniquely
identifiable
- Stores data such as when and where made, maximum inflation pressure,
tire size, etc.
- Consists of antenna and integrated circuit with higher data
capacity than bar code
Significant
Points
- RFID technology most likely to be introduced through OEM market
- Could soon be feasible for replacement tires as well
- In future, electronics in tires will be able to communicate
tire pressure, etc. to vehicle’s computers
- At least one OEM working with Michelin to bring RFID to market
as option in model year 2005
Web
Source
Sourced
from: Collision Week, January 15, 2003
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| 9)
GM, Ford Diesels Delayed By Failure to Meet Tier 2 Emissions Rules
|
| Situation
- GM, Ford lag on diesel deployment out of fear NOx emission standard
still can't be met
- VW, DC plan limited intros on selected models, but tighter rules
in 2004-09 ("Tier 2") scare off GM, Ford
- New diesels due in 2004: Jeep Liberty, Mercedes E-Class, VW
Passat
- Lower-sulfur diesel fuel sought by GM, Ford, now set for 2006
rollout, but being targeted for speedup in Congress
- Light duty diesel truck NOx limit cut from 0.97 grams/mi to
0.2 in most flexible category and fleet-average 0.07 in 2009
- Current NOx light duty diesel standard of 1.25 grams/mi is 18
x higher than 2009 standard
Significant
Points
- Even if diesel emissions ceiling relaxed, GM, Ford fear backlash
over diesel fiasco of early 1980s
- This could be outweighed by enviro concerns -- or if tax credit
is authorized for purchase as on electric, hybrid vehicles
- Automakers biggest fear: relaxed Fed rules may cause more states
to opt out and join CA's tougher clean air rules
- Diesel industry can't afford to give impression its engines
can't meet same standards as competing engines
- Mideast war crisis underscores growing interest in marketing
more diesels as fuel saver
- Dealers report even affluent buyers paying cash voice concern
about low mpg ratings on likes of big SUVs -- trend gaining momentum
Web
Source
Sourced
from: Automotive News, January 20, 2003, Page 1
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| 10)
Satellite Tracking Devices Raise Liability, Privacy Questions |
| Situation
- Recent legal cases involving automotive GPS technology raising
liability, privacy concerns
- Recently, rental van used to transport stolen cigarettes found
using rental agency's GPS tracking equipment
- Suspects were arrested, stolen merchandise recovered
- In other case, rental agency used GPS to track renter's road
speed, then tacked on penalty when driver eclipsed limit
- Court ruled rental company had no right to track renter
Significant
Points
- Arrest in rental van case raises question of liability; is dealer
invading privacy
- Experts aren't sure but agree that courts will eventually have
to decide
- In speed case, court said driver had broken no rules when rental
company started tracking
- Dealers using GPS should have computers secure against hacking
to protect personal data
- Dealers should also be aware of questions of disclosure when
dealing w/ GPS systems
Web
Source
Sourced
from: Used Car News, January 20, 2003
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to top |
| 11)
Bush and Environmentalists Clash on SUV Tax Break; Proposal Triples
Business Write-off Limit |
| Situation
- Proposed tax change in President Bush's economic stimulus plan
would triple business write-off for SUV or pickup
- Amount that could be written off hiked from $25K to $75K
- Hummer H1, MSRP of $102,581, could benefit from $75K capital
equipment deduction, plus "stimulus" and depreciation deductions
totaling $13,125
- Enviros call SUV/truck deductions excessive, mass to fight deductions
in Congress
- Timing of deduction jump comes amid rising storm against fullsize
SUVs led by Detroit Project
- Automakers likely to defend SUV write-off, inasmuch as SUVs
produce highest profits per vehicle of any vehicle
Significant
Points
- SUV battle pits enviro and safety champions against automakers
- SUV popularity keeps spreading, w/ largest models supplanting
minivans despite high gas usage
- Right of Americans to choose vehicles of choice also at issue,
bedrock issue which upended curbs on foreign imports in early
1980s
- Big-3's reliance on biggest SUVs for profits also paramount
Web
Source
Sourced
from: Detroit News, January 20, 2003, Page 1A; New York Times, January
21, 2003, Page C1; Business Week, January 27, 2003, Page 38
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| 12)
Saturn Seeks To Shed "Chick's Car" Image, Aims For Male Buyers |
| Situation
- 200-hp turbo Ion due in 2004 pitched at males
- Saturn casts peppier cars as competition for Corolla Matrix
XRS, Honda Civic SI
- Ladies account for 55% of Saturn owners, as males opt more for
Asian tuners, Ford Mustangs, Focus SVTs
- Saturn pressured by GM to boost sales 50K cars a year to 2006
- On Saturn agenda: 6-seat tourer, Epsilon-platform L-series successor,
hybrid-engine Vue SUV -- all in 2005
- Sales, service and marketing VP Jill Lajdziak accepts fact Saturn
now part of GM ad group and sells to fleets (28K last year)
Significant
Points
- Saturn called key to helping rebuild GM car sales by GM product
chief Robert A. Lutz
- It was Lutz who urged Saturn, 12 years old and without trendy
SUV until 2002, to add turbo Ion and push for Sky roadster
- Low-profit/no-profit record still keeps Saturn dicey problem
for GM's finance-tuned leaders
- Saving Saturn for now Vue's 75K sales last year, even as disappointing
L-series midsizer needed $2.5K rebate at year-end
- Saturn dealer satisfaction product quality remains high and
being corporate "partner" should help matters
Web
Source
Sourced
from: USA Today, January 21, 2003, Page 8B
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| 13)
GMAC Threatens to Stop Leasing in NY, CT, RI Unless Vicarious Liability
Laws Repealed |
| Situation
- GMAC warns NY, CT, RI dealers it will quit leasing unless vicarious
liability laws repealed
- Under extended liability, lessor exposed to accident damages
along w/ lessee
- NY state leasing will end in May if no change made, says GMAC
- $28M judgment against lessor Chase Auto Finance in RI last year
forced crisis
- Lease acquisition fees raised to $1K, $1,075 in 3 liability
states by GMAC, Ford Credit, Chase, et al
- NY Auto Dealers Association joining automaker arms in lobbying
legislature for repeal
Significant
Points
- Could be rough unless lease-like balloon notes catch on (NY
alone accounts for about 45K GMAC leases a year)
- Balloon notes tougher sell, since option to dump vehicle back
on dealer/lender doesn't exist
- Lender exposure also causes significant boost in rates, making
it harder to compete in incentive wars era
Web
Source
Sourced
from: Automotive News, January 20, 2003, Page 4
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| 14)
Ford Inadvertently Posts Private Financial Info, Earnings Projections
on its Website |
| Situation
- Ford Motor inadvertently posted private financial info and earnings
projections on its Website for about 10 minutes on Jan 21
- Several slides containing 2003 profit and market share projections
were attached to materials Ford provided for a conference call
w/ journalists and analysts
- Material included a forecast of wider-than-expected losses in
N America
- Ford quickly pulled the documents from its Website but they
were widely distributed via e-mail
- Ford CEO Bill Ford and President Nick Scheele were peppered
w/ questions about the slides during the conference call
- Slides concerned analysts, who were taken aback by dismal outlook
for N America and doubtful Europe and S America could be successful
this year
Significant
Points
- Of particular interest was a projection that Ford's core N American
car and truck business would lose $1.8B in 2003
- That is triple last year's loss
- Documents also forecasted that Ford's profits in Europe and
S America would improve to offset N America's losses
- Ford subsequently filed a report w/ SEC on Jan 22
- Report said back-up slides were draft and/or preliminary materials
prepared for background and scenario planning, and contained material
inaccuracies
- Some analysts said projections appeared to be unrealistic and
ignored them while others expressed concern
Web
Source
Sourced
from: Sourced From: The Detroit News, January 23, 2003
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| 15)
Ford Narrows 2002 Loss, Sees $1.8B Loss This Year For N America, But
CEO Says Company Will Meet 2003 Targets |
| Situation
- Ford narrowed its 2002 net loss to $980M after hefty loss of
$5.45B in 2001
- But relief in doubt for 2003 as Ford gaffe on Internet reveals
projection of $1.8B net loss for N America, up from $559M last
year
- On upside, Ford Credit reported $1.23B profit last year, up
from $838M in 2001
- Ford Motor had net loss of $139M in 4Q as turnaround began to
show results
- 2002 revenues edged up to $162.6B from $160.8B on sales of nearly
7M vehicles, almost same as in 2001
- Ford expects N America loss this year, tripling 2002 loss, to
be offset by profitable operations in Europe, S America
Significant
Points
- CEO William Clay Ford, Jr. tells analysts company expects to
meet targets in 2003 as "progress continues"
- Profit sighted in 1Q of 2003 due to sharp boost in output of
new F-150 pickups
- Europe turnaround expected w/ phase-ins of new Jaguar XJ flagship,
Volvo SC90 SUV
- Product costs reduced $237 per vehicle in 2002 -- big factor
in reducing losses from 2001
- Reflecting Ford Credit's upturn, it paid $700M dividend to parent
company Dec 31, 2002
- Ford CFO Allan D. Gilmour predicts 16.5M vehicle sales in 2003,
justifying Ford output boost in 1Q to 1.03M units
Web
Source
Sourced
from: Wall Street Journal, January 22, 2003, Page A3
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| 16)
Cadillac Rebounds on Wings of Year-Old CTS, Escalade; 16% Gain Largest
In 20 Years |
| Situation
- $4B gamble on new Cadillac products paying off
- Long-slumping luxo division enjoys 16% sales spike in 2002,
largest gain in 20 years
- Despite rap on blade-like Stealth styling, CTS draws new shoppers
trading in Lexus or Volvo
- New models coming in 2003 -- CTS-based CRX SUV plus $75K XLR
sportster -- add to Caddy buzz
- GM prefers to go upmarket w/ Caddy, leaving downmarket strategy
to Euro arch-rivals BMW, Mercedes
- Neiman Marcus catalog sale of 99 XLRs -- at puffed price of
$85K -- sold out in 14 minutes, leaving about 2K bidders out of
luck
Significant
Points
- Without CTS, Escalade, Caddy would have suffered another sales
drop on aging Deville, Seville brands
- Nor would Sixteen super-luxo sedan priced at $200K ever have
been showcased or considered to combat 6-figure entries from Bentley,
Rolls-Royce or Mercedes
- Positioning Cadillac upmarket leaves space for upgrading Buick,
Pontiac
- Dealers enthused over outlook, Chattanooga, TN's Tim Kelly declaring,
"we're waiting with baited breath for SRX this fall"
- It's a new world for Cadillac, recalling should-have-beens such
as Corvette-like Allante
- And shouldn't-have-beens like Cimarron, or diesel and V-8/V-6
varied ratio engine, and Eldorado
Web
Source
Sourced
from: Wall Street Journal, January 23, 2003, Page B1
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