Peugeot

Fiat Chrysler Peugeot: Now What?

December 19, 2019 by admin Leave a Comment

Chairman of the Managing Board of Groupe PSA Carlos Tavares and FCA CEO Mike Manley share a congratulatory handshake after concluding the merger agreement between their two companies.

Save for regulatory scrutiny, antitrust review, and shareholder approval, Fiat Chrysler and the PSA Groupe are set to merge. The two automakers agreed on a framework for merging the two companies, which will create the world’s fourth-largest automaker after the Volkswagen Group, Toyota Motors, and the Renault-Nissan-Mitsubishi Alliance.
We’re still about a year away from the merger’s completion. In the meantime, we’ll be waiting for word on the new name for the entity. I like “Global Motors” but I think GM would object.

Capacity, Electrification, & Autonomous Vehicles

No matter what happens over the coming months, a lot of what you’ll be hearing will be speculative especially as the companies have been relatively mum on where things are going. We do know no plants will be closed or jobs lost, but with a build capacity of 14 million units and current annual sales of 8.7 million units, there is ample room for consolidation. And it is doubtful we’ll see a significant increase in sales to narrow that gap, although Jeep and Ram may fuel much of the growth moving forward.

But there are certain trends such as electrification and autonomy that will impact the newly minted automaker. Like it or not, the industry is going through an upheaval, but I will say that full electrification isn’t likely to happen in the short term, if ever. Instead, we’re likely to see some sort of “hybrid” system based largely on hybrid electric vehicles. As for autonomy, large cities are the likely place to roll out the technology, but getting it to the masses will take many years and require an enormous amount of capital.

From the left side of the Atlantic, there are a few things we’re all wondering about and are certain to become the topic discussed at your favorite cars and coffee or other automotive meetups in the coming months. Here’s a sample of key questions we believe are foremost on Mopar fan minds.

Which brands will die?

The current FCA stable includes Fiat, Chrysler, Alfa Romeo, Dodge, Lancia, Jeep, Maserati, Abarth, and Ram. That’s nine brands to manage and will soon climb to 14 with the Peugeot, Citroën, DS, Opel, and Vauxhall brands. It isn’t inconceivable that an automaker would manage so many brands – the Volkswagen Group is comprised of 12 brands. Even so, we could see a few brands dismissed. Dodge and Chrysler are most vulnerable and Vauxhall could simply be folded into Opel.

End of muscle cars?

FCA has done quite well with its muscle car lineup, with the Dodge Challenger firmly in second place behind the Ford Mustang and ahead of the Chevrolet Camaro. Having the four-door Dodge Charger to complement the sport coupe has always been a plus. Yet, these two models are aged and may not have enough life in them to continue for many more years. One way the models survive is if PSA has a platform to support them. That’s not known, although the new company could tap the Alfa Romeo Giulia/Stelvio’s platform for them.

When will Peugeot begin selling its cars here?

Long absent from the US market, Peugeot has fixed its eyes on returning by 2026. These plans were put in place in 2018, with the company establishing new US headquarters in Atlanta. That timeline was moved up by a few years earlier this year, even before the announced merger. No matter what happens going forward (merger or no merger), Peugeot plans to make its return, according to Car and Driver. Likely, they’ll import models built in Europe, foregoing US manufacturing, at least initially. That’s a sensible approach as FCA capacity is nearly full stateside, while European plants for both FCA and PSA are underutilized.

What’s the role of Opel going forward?

GM owned Opel (and Vauxhall) from 1929 to 2017, before selling the brands to PSA. Since then, Buick has continued selling several Opel products under its name including the now-discontinued Cascada convertible and the Regal sedan/hatchback/wagon. That agreement is coming to an end and soon Buick will sell crossovers only. That could leave the door open for Opel to arrive stateside on its own, but we doubt that’ll happen, at least not before Peugeot.

Getting it Done

No doubt, the FCA-PSA deal will get done. There are some issues to settle, including GM’s suit against FCA alleging racketeering over labor negotiations (which allegedly favored FCA at the expense of GM). Some are arguing the suit is GM’s attempt to thwart the merger and nothing else. Regardless, the matter should be settled before the merger is finalized.

With FCA and PSA united, expect other automakers to explore ways to combine synergies through alliances, acquisitions, and mergers. My personal “favorite” alliance is VW-Ford, as the two automakers are currently collaborating on self-driving cars and electric vehicles. That may leave GM as the last “American” automaker standing, besides Tesla, Rivian, Bollinger, and a few other upstarts.

Photo copyright Fiat Chrysler Automobiles.

Up Next: Ford-Volkswagen Tie-up?

October 31, 2019 by admin 4 Comments

What a week it has been. More like a half-week, actually.

For it was within that abbreviated timeframe we officially heard that Fiat Chrysler and the PSA Groupe (Peugeot and Citroën) were talking merger. The news spilled out late Monday and by Wednesday the two automakers came to terms. Today, news of the planned merger was announced, setting in place what will become a near $50 billion entity, which currently produces 8.7 passenger vehicles annually.

Merger talk doesn’t take place in a vacuum. Indeed, soon after the FCA broke off talks with Renault to merge in June, rumors of PSA’s interest in FCA came out. All we’ve heard is what was reported this week. But talks have been going on for some time, carried under the cloak of secrecy.

We shouldn’t be surprised that the two automakers are connecting as the entire industry is ripe of consolidation. With the deal nearly certain to pass, it likely will trigger further consolidation with perhaps Ford and Volkswagen following. Yes, these two automakers seem like prime candidates for an alliance or outright merger. There are several reasons why, which we’ll explore here.

Volkswagen and Ford: The Next Tie-up?

1. The two companies forged a global alliance.

In January 2019, Ford and Volkswagen announced that the two companies were forging a global alliance, but without cross-ownership. Pickup trucks and commercial vans were the first vehicles mentioned where collaboration will take place.

2. An EV/AV alliance follows.

In July, Ford and Volkswagen announced that the two automakers would begin sharing electric vehicle (EV) and autonomous vehicle (AV) technology. VW is investing in Argo AI, which is Ford’s self-driving technology, while Ford will build at least one vehicle based on Volkswagen’s Modular Electric Toolkit (MEB) architecture for sale in Europe.

3. Ford cuts back on cars.

The Ford Motor Company still produces cars, but the U.S. market will soon offer only the Mustang, pickup trucks, and lots of utility vehicles. With a VW tie-up, Ford might find it affordable and sensible to sell small cars again in the U.S., especially as the merged entity shaves costs. In any case, if the market suddenly shifts to cars again, Ford will have the platforms in place to build what’s needed.

4. The Rivian factor.

We already know that Ford owns a slice of Rivian, the upstart electric vehicle maker. Rivian will begin producing an SUV and pickup truck by the end of 2020. Ford will have access to Rivian’s skateboard electric vehicle architecture, which is certain to produce at least one model for the Ford brand. Volkswagen wants a pickup too and might utilize Rivian besides tapping the Ford Ranger for its own purpose.

5. Big is better.

When it comes to building passenger vehicles, the bigger you are, the better. Or at least that is the thinking in this industry. Yes, “economies of scale” and “synergies” are realized through smart collaboration. But there is another factor, bragging rights, which the new company led by Volkswagen would claim as sales would top an estimated 14 million units annually, putting the new automaker well in front of the pack.

What About GM?

With FCA and PSA hooking up and Ford and Volkswagen presenting a strong argument for consolidation, what about GM? At one time we might have seen GM go it alone or acquire another automaker, but that’s not going to happen.

Fresh on the heels of a costly labor agreement with the UAW, GM is ripe for the picking. We don’t see Toyota or Hyundai/Kia interested nor is it likely Honda with its independent streak planning to do likewise. There’s a chance GM might find a place in the Renault-Nissan alliance, but we think a Chinese suitor is just as likely.

In any case, the industry is changing and most likely will see additional mergers, acquisitions, and alliances in the months ahead. FCA and PSA triggered the tsunami. Now we’ll witness how other automakers avoid getting consumed by the waves of change.

Emerging Alliances Point to Further Auto Industry Consolidation

March 28, 2019 by admin

What a month! March 2019 may go down as a pivotal time in automotive history as auto industry consolidation talk strengthens anew.

The news is coming from all corners of the globe as multiple players talk, while others forge alliances. Consolidation certainly isn’t anything new, but the future absolutely points to a host of mergers and alliances taking shape.

2019 Ford Ranger — Volkswagen and Ford are forging a pact that might lead to a Ranger-based pickup truck for VW.

Ford, Volkswagen Tie One On

Heading the alliance news this month is a not-yet-signed agreement between Ford and Volkswagen. According to Reuters, the two automotive giants have been in talks for months and appear ready to sign a pact.

That agreement may involve Volkswagen purchasing a stake in Argo AI, which is Ford’s artificial intelligence company. Argo AI represents the blue oval’s autonomous vehicle and artificial intelligence aspirations, a company launched in 2016. Volkswagen doesn’t have an equivalent business, thus investing in Ford’s venture would give it instant access to AI.

At the same time, Ford appears ready to supply Volkswagen with a pickup truck. The German automaker doesn’t have a model for the American market, though its car-based Amarok is sold in multiple markets. Although the type of truck has not yet been identified, we believe a model closely based on the midsize Ford Ranger pickup truck seems likely.

Daimler, Geely Go Beyond Ride-Hailing

Daimler and Geely are expected to soon sign an agreement which would allow the Chinese automaker to purchase a 50-percent stake in Daimler’s Smart small-car brand. Smart has been languishing for years and talk of the brand’s demise emerged just this week.

But Smart may find new life yet as an electric car manufacturer with the Chinese market its main source. The Financial Times reports that an announcement will be confirmed at the Shanghai Auto Show in April.

The two manufacturers are no strangers, although Daimler’s Mercedes-Benz and Geely’s Volvo brands are direct competitors. In 2018, the two companies joined forces to form a China-based ride-hailing company reports CNN.

A Suitor for FCA

The late Fiat Chrysler executive Sergio Marchionne fashioned one of the most unlikely alliances earlier this decade as he married a pair of Italian and American automakers, but he was never satisfied that it would last apart from further consolidation.

Indeed, Marchionne was one of the earlier proponents of global consolidation, noting as far back as in 2009 that there would be “six survivors in the global volume sector.” Marchionne stated his viewpoint during the midst of a worldwide downturn in auto sales that nearly sunk Chrysler and GM and put other manufacturers in jeopardy.

See Also — Auto Industry Buzzword: Collaboration

Marchionne passed away in 2018, but the spirit of FCA consolidation lives on. Notably, in the past few weeks, we have heard that both France’s PSA Groupe (Peugeot, Citroën, Opel, et al) and the Renault-Nissan-Mitsubishi alliance seems interested in acquiring FCA. Jeep and Ram are FCA’s two strongest and most profitable brands and are the top prizes here. At the same time, a merger or an alliance might help FCA improve its performance in Asia, especially in China where it is particularly weak.

But these two possible companies/alliances aren’t the only ones interested in FCA. Several years back the Volkswagen Group targeted Fiat Chrysler, but its overtures were rebuffed. More recently, Hyundai expressed its own interest in the company, but it wasn’t planning to make a move until after FCA’s share values fell.

Limited Agreement Auto Trends

While further consolidation seems likely, more limited agreements between competing manufacturers will continue to emerge.

One of the results of this kind of agreement brought the Toyota Supra back to the market. The Supra’s return comes thanks to an agreement between Toyota and BMW, as the former used the latter’s Z4 platform to build its sports car. Toyota has also worked with Subaru to produce its 86 sports car, and may continue that pact for a new generation model.

Toyota, thanks to its size and deep pockets, may yet avoid the entire alliance and consolidation trend. With stakes in Daihatsu, Suzuki, Subaru, and Mazda, the company can turn to its partners to supply vehicles it doesn’t have. Further, it may work with its associated companies to spread development costs as needed without ceding control.

Peugeot Prepares for its U.S. Return

February 27, 2019 by admin

This Peugeot 2008 SUV may someday find its way to the U.S.

French automaker Peugeot departed the U.S. market in 1991, following years of operating in relative obscurity. Indeed, the company never sold more than 20,000 vehicles annually during its time in the states, with just a fraction of that number sold in its final years.

The automaker’s parent, the PSA Groupe, has been planning its U.S. return since 2016, although it wasn’t clear whether it would market its Peugeot, DS or Citroën brands stateside. Furthermore, the company later acquired the Opel and Vauxhall brands from GM, casting a bit more uncertainty about its intentions.

Push to Pass: Bring Us a Peugeot

We now know that the Peugeot brand is PSA’s choice for leading the company back to North America. Moreover, Peugeot’s return is part of a wider Push to Pass” plan, which was outlined this week.

The global plan includes bringing Citroën to India and Opel to Russia, while enhancing DS’s international footprint. The company is seeking to increase its non-European business by 50 percent by 2021, an ambitious undertaking that won’t include U.S. and Canadian sales. Indeed, Peugeot’s North American return won’t happen before 2026, thus the company’s initial sales thrust will depend on other markets.

Don’t expect PSA to commit to building a U.S. manufacturing plant, at least not initially. The company plans to import cars from China and Europe to meet North American capacity (including Canada), according to Automotive News. PSA CEO Carlos Tavares said the North American launch will be done in a “frugal, conservative and profitable way.”

Free2Movie App — PSA’s U.S. operation already includes this Free2Move app.

There’s an App for That

PSA’s North American headquarters is based in Atlanta. Already, the company has its Free2Move app, which tracks all the shared cars, scooters, bikes, and rides in a city. The app consolidates various car- and transportation-sharing businesses to one app, making it easier for users to find what they want. At present, the app tracks Car2Go services in Portland and Seattle and adds cycling service to Washington, DC.

PSA plans to launch a whopping 116 vehicles by 2021, including concepts. The automaker wants to reduce the average age of its product range to just 3.5 years. That’s below the industry average and could give this automaker an edge in a market where consumers want the latest models.

French, But Not Renault

Peugeot’s pending return ensures a French automaker is once again represented in the U.S. market. The company’s chief rival, Renault, doesn’t have a presence either, as it exited the market a few years after selling its AMC subsidiary (including Jeep) to Chrysler in 1987. Renault’s alliance partner, Nissan, however, is well-represented in the Western Hemisphere, including in the U.S. and Canada.

DS SUV — PSA’s premium DS brand won’t be headed to North America. At least not yet.

The Peugeot 2008 SUV might be one of the first models we see from the French automaker. It is a compact model with a 2019 starting price of about $23,500. Its current competitors include the Nissan Rogue and Chevy Equinox. In the midsize utility vehicle segment is the Peugeot 5008 SUV, which costs around $35,000. Like models include the Hyundai Santa Fe XL and the Honda Pilot.

Of course, the new vehicle market may look far different than it is today, with a host of electric and autonomous vehicles dominating the segment. Peugeot also has a fleet of cars in its arsenal, including hatchbacks and sedans. The automaker also has a line of vans, ranging in size from compact to full-size. Whatever Peugeot supplies, it will give North American consumers yet another choice in a crowded sphere.

Photos courtesy of the PSA Groupe.

Wagon Master: 2018 Buick Regal TourX

May 14, 2018 by admin 5 Comments

Buick overhauls the Regal line, adds TourX and Sportback models.

2018 Buick Regal TourX — The 2018 Regal line expands to include this TourX wagon.

The Buick Regal has taken on many forms across its long history, including a coupe, sedan and briefly as a wagon. Its previous iteration was as a four-door sedan, a model developed in Germany, then built in Canada for the North American market.

Well, sedan sales have been deteriorating for years and after a seven-year run, Buick cancelled most of the sedan line, although the performance GS remains. Beginning in 2018, an updated Regal portfolio is in place, but this time it also includes a hatchback (Regal Sportback) and a wagon (Regal TourX). As of publication, Buick offers the Sportback in the US and Canada, while the GS sedan and wagon are exclusive to the United States.

The two newest Regals are once again built only in Germany and by Opel. Up until last year, Opel was a GM division, but now owned by Groupe PSA, mainly comprising Peugeot and Citroen, the French automaker.

We cannot explain for certain how or why this arrangement continues, other than to say that when the Opel-to-PSA deal became final, certain models were sharing a common platform and will likely do so for years ahead. No matter, the Regal TourX is an Opel (or a Vauxhall) Insignia in some markets, but it is also a Holden Commodore in Australia. Got it?

2018 Buick Regal TourX

For this review, we shall look primarily at the test model at hand — the 2018 Regal TourX. Where necessary, we will mention a few things about the Sportback, but not much else. There are some differences between the two, therefore we will not take a deep dive into what we have not driven. Just so you know, Buick markets the Sportback as a “Car,” but it lists the TourX under its “SUV & Crossovers” category.

The 2018 Regal TourX comes in three trim levels: TourX ($29,070), Preferred ($32,670) and Essence ($35,070). These prices do not include the $925 destination and handling charge, nor are taxes, fees, tags or discounts factored in. All models have a turbocharged engine, an automatic transmission and all-wheel drive.

Exterior Highlights

The Regal TourX does not attempt to hide its wagon design and that is a good thing. Up front, it shares a fascia common to the brand with the Buick tri-shield insignia and wing-like chrome bands flowing out from the center. Sleek headlamps and pronounced cutouts for the fog lamps add sporty touches.

The wheel wells come wrapped in contrasting trim, while deep sculpting marks the profile. A rising beltline and falling roofline meet to form the liftgate. The rear fascia has sleek wraparound tail lamps and dual exhaust ports.

Although obviously a wagon, this model adds special styling points, including an upswept rear roof pillar. You will also find chrome door trim that runs from the front to the rear pillars, then intersects with the tail lamps. Whoever said a wagon cannot deliver flair? It is a look I found appealing.

Standard equipment includes halogen headlamps, fog lamps and 18-inch aluminum wheels. Available features include LED headlamps with automatic leveling, a panoramic moonroof, power-heated side mirrors, roof rack rails and a power liftgate.

2018 Buick Regal TourX

Interior Highlights

When it comes to passenger space, the TourX compares with any midsize, two-row SUV. Specifically, the Jeep Grand Cherokee, Ford Edge and the Nissan Murano are three that come to mind. The main difference, of course, between the Buick and this trio is the high profile of the competitors. Other than that, the Buick compares well here.

The TourX interior reminded me of the Buick Enclave, a three-row SUV with nine more inches between the wheels. Plenty of soft-touch materials, chrome and with the Essence model, leather. It is a look that is at once soothing as it is elegant, one that supplies a fitting parallel to the LaCrosse sedan.

The driver-centric instrument panel is big and clear, the center console smartly ordered and uncluttered. The front seats are plush, yet firm. The rear seat holds two adults with ease and three when needed. My test model had leather seats, although cloth seats are standard. The cabin is very quiet and is up there with Buick’s exacting standards.

Standard equipment includes full power accessories, a tilt-and-telescopic steering column and air conditioning. Among the upgrades you will find are a heated steering wheel, power front seats with lumbar support, heated front seats, ambient lighting and dual-zone climate control.

Not to leave out of the discussion is the storage space behind the second-row seat. Buick supplies 32.7 cubic feet, which is more than the 23.6 cubic feet in the Enclave. But if you fold the third-row seat in the Enclave you have a generous 58 cubic feet. Back to the TourX and you have 73.3 cubic feet behind the first row — that’s ample room to carry your gear — a bicycle, tent, skis, what have you. And that is why Buick offers a standard 60/40 or an available 40/20/40 second-row bench seat.

2018 Buick Regal TourX

Technology & Safety Features

I have long praised Buick for its tech features and the TourX does not disappoint. The audio package includes a 7-inch color touch screen display, Bluetooth, and Apple CarPlay and Android Auto smartphone compatibility.

You will also find a USB port inside the center console and a WiFi system for connecting up to seven devices. Other features include keyless entry and push-button start, remote panic alarm and OnStar connected vehicle services.

Upgrades include HD and satellite radio, navigation, an 8-speaker Bose audio system and remote start. Wireless charging is an option.

Among safety items you will find a rear vision camera. Move up through the trim levels and multiple driver-assist features roll out, including lane change alert with side blind zone alert, rear cross traffic alert and rear park assist. Other features include lane keep assist with lane departure warning, forward collision alert, front pedestrian braking, and adaptive cruise control with forward automatic braking. My top-of-the-line Essence trim had all such features present.

(See Also — Swift Sportback: 2018 Buick Regal GS)

2018 Buick Regal TourX

On the Road: 2018 Buick Regal TourX

A station wagon has a V8 engine, right? Or at least a powerful V6. Well, in this case it has neither.

How about a turbocharged 2.0-liter four-cylinder engine? That is exactly what motivates the Regal TourX, delivering 250 horsepower and 295 pound-feet of torque. Buick pairs this engine with an eight-speed automatic transmission.

Do these numbers seem underpowered? Well, consider how they stack up with the Buick Lucerne, a full-size model last offered in 2011: that sedan’s 3.9-liter V6 earned 227 horsepower and 237 pound-feet of torque. Further, there was a V8 available as well, delivering 292 horsepower and 288 pound-feet of torque. Thus, the torque number on the TourX beat the old V8 and that is something to keep in mind when considering this model.

Off-the-mark acceleration with the TourX is quite good. When you need extra power, the turbo kicks in with only minimal lag detected. A willing transmission works unnoticed in the background and that is what we like. Direct and weighted steering imbue driver confidence, while the smooth ride should please everyone.

Although not a curve carver, the TourX stays planted. The all-wheel drive system is a big help on wet roads as well as when you pull out of a corner. That’s the main difference between the Sportback and the TourX — the hatchback offers standard front-wheel drive and available all-wheel drive. I think Buick made the right decision by making the TourX all-wheel drive only.

As for off-roading, this wagon is strictly designed for light-duty work — traveling on gravelly roads or dusty paths. Its 6-inch ground clearance means you won’t be following the Outback across a shallow creek or to a sandy beach.

2018 Buick Regal TourX

Parting Thoughts

There is a revival taking place in the wagon market. Besides the TourX, you will find the Subaru Outback, Audi A4 AllRoad, Volkswagen Golf Alltrack and the Volvo V60 and V90 Cross Country models. We must not leave out the Jaguar XF Sportbrake and the Mercedes-Benz E-Class Wagon, although both aim squarely at the luxury market.

I found myself almost giddy with the TourX, especially when I showed the vehicle to crossover and minivan owners. For the most part, there was a distinct love it/hate it reaction by some, but then I could see others carefully taking it in. That alone is a good thing as wagons fell out of grace long ago, especially by those who left one for a minivan.

But the market is cyclical and what was once out of favor could very well catch on again. With Buick, there is no need to wait as the 2018 Regal TourX delivers. Choose the well-equipped Essence and you will come away with a loaded model for under $40,000. This represents an important price point for similar crossover SUVs.

2018 Buick Regal TourX

2018 Buick Regal TourX Specifications

Buick	2018 Regal TourX
Segment	Small Station Wagon
Base Sticker Price	$29,070 ( plus $925 destination charge)
Price as tested	$41,550
Standard Engine	2.0-liter, turbo inline-four
Horsepower	250 @ 5,400 RPMs
Torque (lb.-ft.)	295 @ 3,000 to 4,000 RPMs
Transmission	Eight-speed automatic
Seating	5
Curb Weight (pounds)	3,708
Wheelbase (inches)	111.4
Length (inches)	196.4
Width (inches)	73.1
Height (inches)	59.1
Head room (f,r…inches)	38.8; 39.0
Leg room (f,r…inches)	42.1, 36.9
Shoulder room (f,r…inches)	56.9, 55.4
Hip room (f,r…inches)	55.2, 54.1
Storage (cubic feet)	32.7; 73.5
Gross vehicle weight (pounds)	NR
Towing (pounds)	NR
Payload (pounds)	NR
Fuel	Premium
Fuel Tank (gallons)	16.3
EPA Fuel MPG (city/highway)	21/29
Manufacturing Plant	Ruesselsheim, Germany

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Will Renault Models Replace Fiat Chrysler Products?

February 3, 2016 by admin Leave a Comment

French automaker Renault may have the solution to FCA’s product needs.

If you want to buy a French-built model in the US, you probably know that Renault, Peugeot and Citroen have no presence in the market. Instead, you’ll only be able to consider the Toyota Yaris, the lone model currently built in France and exported to the US.

2015 Chrysler 200. — The current Chrysler 200 may be replaced by a competitor’s model.

Exit…Stage Right

Both Renault and Peugeot-Citroen once had a presence in the US. Indeed, Renault had controlling interest in American Motors for several years, but exited the market in 1989, two years after selling those assets to the Chrysler Corporation. In 1991, Peugeot made its own exit from the US market, ending Citroen sales too. Some twenty-five years later, few Americans under 40 can recall cars built by French manufacturers and sold in the United States.

Neither manufacturer is poised to return to the US, a market that is immensely profitable, but is also brutally competitive. Beyond domestic manufacturers such as Packard, Checker and Studebaker, a host of foreign makes have thrown in the towel too, including Isuzu, Yugo, Daihatsu, and Suzuki.

However, one of the two French manufacturers could make a return, especially if partnered with a company already present in the US. Renault’s logical partner is Nissan, as both companies own a slice of each other and are jointly led by Carlos Ghosn, the Brazilian-born CEO for the two automakers. Its a successful alliance that has produced numerous cars for the two companies since the confederacy was forged in the late 1990s.

On the other hand, Peugeot-Citroen is not so lucky. A brief partnership forged with GM in 2012 was ended less than two years later as Peugeot sought assistance from Dongfeng, a Chinese manufacturer to support its operation. Of the two French companies, Peugeot’s financial picture is the weakest.

Renault to the Rescue?

Turning back to Renault, this automaker could very well find its way back across the Atlantic, especially if Fiat Chrysler works out an agreement for the French automaker to supply it with vehicles. Indeed, FCA CEO Sergio Marchionne announced last week that his company would no longer build its compact Dodge Dart and midsize Chrysler 200 sedans, choosing instead to devote plant capacity to build more Jeeps and Ram pickup trucks. That move means FCA should become more profitable as well as more attractive to a potential suitor.

At the same time, Marchionne said it would turn to its competitors to supply these models, but the likelihood that a Ford, Toyota or a Hyundai would dilute their own model lines to accommodate FCA seems very unlikely.

Renault may be the most logical supplier for FCA as it has two models — the midsize Latitude and the compact Mégane — that might possibly be rebadged and sold in the US. Both models are underpinned by platforms shared with current Nissan products (Altima and Sentra), but otherwise the cars are all Renault.

The downside in choosing the Mégane is that it isn’t a sedan — Renault builds hatchback, coupe and wagon variants, but no four-door sedan. That said, the hatchback might be a fit for a market that is finally accepting this body style again. Currently, Renault builds the Mégane at four plants scattered across Europe and might be in a position to supply the next generation Dodge Dart.

The second model is the Renault Latitude and this one is already sold in Mexico, where it is known as the Renault Safrane. Interestingly, the Renault Latitude/Safrane is built in Korea by Renault Samsung Motors, a minor car manufacturer operating in a market dominated by Hyundai and Kia.

Busan Plant Capacity

Although the Korean company has built more than 2.4 million cars since its 2000 introduction, its Busan manufacturing plant has the capacity to build 300,000 vehicles annually. Supplying the Latitude as the Chrysler 200 in the US and Canada would keep the Busan factory humming and give Chrysler a much-needed product.

Will Renault respond if Marchionne comes calling? There is a good chance that they would. In 2013, Mitsubishi sought a similar tie up with Renault to supply it with a midsize sedan for the US market, but that deal collapsed. In any case, Mitsubishi is barely hanging on in a market where demand for Renault-supplied vehicles would be much smaller than that of a network composed of Dodge and Chrysler dealers.

At the same time, any Fiat Chrysler and Renault relationship could push out further, perhaps including Nissan and forming at least one kind of a business relationship Marchionne desires.

These are interesting times in the auto industry. Then again, the industry is always fascinating.

GM Restructuring Continues Apace

December 19, 2013 by admin 2 Comments

Cutbacks in Korea, Australia planned. Expansion set for US manufacturing.

The all-new 2014 Chevrolet Impala.

News from General Motors continues to dominate the auto industry, trumping its competitor’s new product introductions. That Mary Barra will ascend to GM’s top office in 2014 is big news, what overshadows the, is he going to Microsoft or staying put?, chatter about Fords Alan Mulally.

All that suits GM just fine because as it leaves government ownership and stewardship in its rearview mirror and focuses on its future, it can finally move forward on several matters it likely has had to put off handling until the federal government sold its remaining shares in the automaker. Those matters are not minor issues either and include the following news stories:

Opel to Trump Chevrolet

The recent news wave began prior to the Akerson/Barra announcement. GM said that it was pulling back its Chevrolet Europe strategy to focus on Opel. Although GM admitted defeat, it likely won itself much needed and desired support in Europe where Opel and Vauxhall are its main products and homegrown ones at that.

Chevrolet entered Europe in 2005 and has lost money since. It wont be a complete abandonment, however, as select Chevrolet models such as Corvette will still be offered. Moreover, Russia will remain an important market for the bow tie brand.

See Also — The History of the Pontiac Fiero

Korean Manufacturing Scaled Back

Korea is an important market for GM and has been since the automaker took over the country’s third largest automaker, Daewoo, in 2001. It was one of the few very good financial decisions GM made leading up to its 2009 bankruptcy and restructuring, a company since renamed GM Korea.

GM Korea supplies the Chevrolet Spark to the US market and also builds Chevrolet models for Europe. But with GM cutting back its Chevrolet exposure across much of the western part of the continent, the automaker has said that it will scale back Korean manufacturing. Indeed, this week GM announced that it would offer up a voluntary retirement for up to 6,000 salaried workers by the end of March reports Fox News. The company says that it expects to reduce its Korean manufacturing by 20 percent to reflect its new strategy for Chevrolet Europe.

Peugeot Stake Sold

One of the worst decisions GM made post-bankruptcy was to secure an alliance with PSA Peugeot Citroen, the beleaguered French automaker. Not just an alliance, but it also took a financial stake worth hundreds of millions of dollars. That 7 percent stake is now gone as GM sold its shares in Peugeot this week.

The two companies say that they plan to continue collaboration on new product, but if Peugeot fails then GM should be able to walk away relatively unscathed. So much for a strategic alliance.

GM Financial trumps Ally Financial for new car loans.

GM Exits Ally

The company once known as the General Motors Acceptance Corporation (GMAC) and now called Ally Financial, had long played a role in helping GM car buyers get auto financing. GM separated GMAC from its own operation in 2006, but most of its business remained with GM. When GM began its slide into bankruptcy, GMAC applied to become a bank holding company.

Later, GM gave most of its new car financing business to AmeriCredit, renamed GM Financial. It still held an 8.5 percent stake in Ally, but sold its shares on Dec. 11, 2013, for $900 million. “This transaction releases capital from a non-core asset and further enhances our financial flexibility,” said Dan Ammann, GM executive vice president and chief financial officer. “Ally continues to play an important role in financing our dealers and customers in the United States.”

Holden Manufacturing to Halt

Will we soon see an end to the beautiful cars imported from Australia that we have come to know and love? Those models currently include the Chevrolet SS and the Chevrolet Caprice SS, based on the Holden Commodore. They aren’t the first Holden-supplied models, with the Pontiac GTO and G8 starting the Aussie onslaught, disappearing as Pontiac was closed down.

GM says that it will stop making cars in Australia by the end of 2013, relying on imports beginning in 2018 to supply its Australian customers. GM, citing costs, will close down its one manufacturing and one engine plant. The company insists that it will keep the Holden brand alive. “Australians have been driving Holden vehicles for decades – and we are determined that Australians will drive Holden vehicles for many years to come,” Mr Devereux said. The high cost of doing business in Australia is behind GMs decision.

Updated Manufacturing and Jobs in the US

With GM cutting back jobs abroad pulling Chevrolet out of Europe and divesting itself of financial stakes in Peugeot and Ally Financial it may seem that the automaker is seeking to conserve cash. However, that recently expanded largesse will soon be tapped to pay for a planned $1.3 billion investment in five manufacturing plants three in Michigan and one each in Indiana and Ohio. GM says that the move will create or retain about 1,000 jobs.

The investment will pay for retooling to support the production of an existing 6-speed transmission, a new 10-speed transmission, and the building of a new V-6 engine. The funds will also pay for plant upgrades as well as for a new paint shop and logistics optimization center.

“GM is committed to a strong American manufacturing base and creating jobs in dozens of communities throughout the country. Today’s announced plant upgrades continue the momentum of a resurgent auto industry,” said GM Executive Vice President and North America President Mark Reuss. “More importantly, these investments add up to higher quality and more fuel-efficient vehicles for our customers.”

Is a Cadillac Elmiraj announcement pending?

But, Wait…There is More!

With Dan Akerson leaving and Mary Barra’s ascendancy timed to coincide with the start of the 2014 North American International Auto Show (NAIAS) in Detroit, GM also wont miss out on a major media opportunity to showcase one or more new cars as it parades Barra before the media.

We already know that the Cadillac ATS Coupe will be revealed, but might we also learn the status for another new product that has everyone talking? That would be the Cadillac Elmiraj, a beautiful full-bodied coupe that made its debut at the 2013 Pebble Beach Concours dElegance. It is the latest super concept for the Cadillac brand and the one that many enthusiasts hope Cadillac decides to build. Yes, the Detroit auto show would present the ideal place to showcase this $100K+ luxury coupe, providing perhaps the best send off for Akerson and a hand off of company leadership to Barra.

Carlos Tavares Named PSA Peugeot Citroen Head

November 28, 2013 by admin 1 Comment

Up until three months ago, Carlos Tavares was the chief operating officer for Renault, the French automaker in alliance with Nissan. Tavares left the company in Aug. after Bloomberg published an article that quoted him as saying that he would like to run another automaker as Renault/Nissan CEO Carlos Ghosn apparently wasn’t going anywhere.

Those words probably didn’t sit too well with Ghosn who at 59 wasn’t ready to relinquish the reigns to Tavares, 55, or anyone else for that matter. Although he was soon out of a job, Tavares was expected to land safely elsewhere, perhaps leading GM or Ford, two companies he has expressed interest in.

PSA Peugeot Citroen

Earlier this week Tavares did land on his feet when rival PSA Peugeot Citroen announced that he will join the company’s management board effective Jan. 1. Later in the year Tavares will replace current PSA CEO Phillippe Varin, who plans to retire.

Peugeot is the second largest car manufacturer in Europe after Volkswagen. The French government and GM own stakes in the company, but the automaker has also been seeking a partnership with Dongfeng Motors, a Chinese manufacturer. In Oct., Reuters reported that PSA Peugeot Citroen was preparing a 3 billion euro (US $4.1 billion) capital increase with monies contributed equally by the French government and Dongfeng, itself owned by the Chinese government.

China’s Dongfeng Motors

Through the originally proposed financial initiative, both Dongfeng and the French government would each gain a 20 to 30 percent stake in PSA. The move would also cause the Peugeot family to lose control of the company as its 25.4 percent stake and 38.1 percent voting share would be reduced. GM’s own 7 percent share would also be diluted once an agreement was made. However, later reports have indicated that Dongfeng is not interested in retaining a stake larger than 10 percent as reported by Automotive News Europe.

Regardless of the number of shares taken, Peugeot has little choice to look for outside help as the company continues to get hammered in the weak European market where its strength lies. PSA has a presence overseas, but it is absent from one important market: North America. Despite its relationship with GM or perhaps because of it, the Peugeot and Citroen brands are not likely to return to the US market, last served more than two decades ago.

Slumping European Market

Peugeot has been mired in a slump for six years as the European market continues to suffer high unemployment and weak growth, especially in western nations. Tavares brings with him more than three decades of automotive experience at Renault, culminating as Ghosn’ second-in-command. Tavares had planned to add both sports car and luxury brands to Renault before he left, moves that could have raised Renault’s global visibility.

Tavares comes to a money losing operation, one that has seen its automotive unit lose 510 million euros (US$691.7 million as of publication) during the first half of 2013. Returning to profitability will require additional sacrifices, what Varin has already required by closing manufacturing plants and through the elimination of more than 11,000 jobs. The French government is eager to stem job losses, as unemployment has been rising steadily moving from 9.5 percent in late 2011 to an estimated 11 percent today.

Tavares is a native of Portugal and speaks French fluently. Thus, heading to Peugeot keeps him in a market he knows well and removes his name from potential successors at GM and Ford. Both US automakers have several of their own executives that might step up when Dan Akerson (GM) and Alan Mulally (Ford) retire. But in the automotive industry job hopping is not only expected, but it is especially required for executives seeking to move up.

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7 Car Brands You Won’t See in the USA Anytime Soon

May 23, 2012 by admin 2 Comments

Tough market and competition keeps some automakers away.

The U.S. auto industry is the second-largest in the world, having been bypassed by China in 2009. China’s ascendancy came as the U.S. market tanked, but its recovery is in progress and promises to be a good one. Car manufacturers the world over prize both markets, desiring the U.S. because of its high profit margins and China for its volume. Not all brands are present in both markets and we can think of several makes that aren’t likely to make an appearance in the U.S. anytime soon.

1. Renault — Big in Europe and in the Americas from Mexico on south, Renault is no stranger to the U.S. market. The French automaker partnered with American Motors Corporation in 1980 and assumed controlling interest of AMC in 1983. Throughout much of the 1980s, Renault and AMC models were sold across the US until Renault sold AMC to Chrysler in 1987. Renault’s presence in the U.S. market ended in 1992 when its rebadged Eagle Premier model was dropped by Chrysler. Today, Renault and Nissan are in a strategic alliance with the latter likely keeping the former from ever showing up stateside again.

2. Peugeot — Like Renault, French automaker Peugeot also sold its cars in the United States, beginning distribution in 1958. Its models, however, were less than inspiring and the market for Peugeot cars never thrived. By 1991, Peugeot exited both the U.S. and Canadian markets, although it has since reestablished a presence in Mexico. Don’t expect to see the latest Peugeot models on U.S. highways within the next few years despite its all-new alliance with General Motors. China is a more practical expansion point for this automaker with GM, perhaps, nixing any possible plans for U.S. distribution.

Editor’s Note: In February 2019, Peugeot announced it will return to the U.S. market, setting 2026 as its re-introductory date. Likely, the company will debut its latest models through a car-sharing service.

3. Skoda — The Volkswagen Group is bent on leading the world in car manufacturing and its Skoda subsidiary will be doing its part to contribute a significant sales boost. The Czech automaker was largely unknown outside of eastern Europe until VW came calling and buying in 2000. Skoda products share platforms and parts with Volkswagen products, but one model could find its way to the U.S. However, Volkswagen is much more interested in promoting its eponymous brand than launching Skoda stateside, thus any Skoda product sold here will likely carry VW badging.

This Skoda MissionL is a Chinese-bound model.

4. SsangYong — It looks difficult to pronounce, but a Korean friend of mine says that the double “S” in SsangYong is treated as a hard S. No matter, this once bankrupt automaker was rescued by India’s Mahindra & Mahindra, a company with its own designs on the U.S. market. Those designs have been thwarted in a legal tie-up with its one-time U.S. distributor and could take years to untangle the mess. SsangYong may prove to be the avenue by which Mahindra makes its official U.S. debut, but we don’t see that happening within five years, if at all.

5. Samsung — Korea’s big electronics company began building cars in 1998, just before the Korean economy tanked. Two years later Renault bought a controlling stake in the automaker, increasing it to 80.1 percent where it is today. Samsung cars are rebadged Nissans, the latter a strategic partner of Renault. Nissan Motors is on a quest to increase its market share in the U.S., with an eye of overtaking Honda as the second-largest Japanese automaker in America. Allowing Samsung badged models would only undercut its U.S. efforts, thus the only Samsung you’ll ever see is the one you watch, make calls on or use to wash and dry your clothes.

6. Holden — Okay, trick submission. Holden cars have recently made an appearance in the United States with its Monaro coupe sold as the Pontiac GTO and its Commodore as the Pontiac G8. When Pontiac died, Holden’s presence in the U.S. went with it, but only for a little while. Today, the Chevrolet Caprice is sold as a pursuit vehicle to law enforcement agencies only. That car is the Holden Commodore-Pontiac G8 and is one model that may eventually be sold to retail customers. As far as Holden getting a hold in the U.S. market, we that think brand-happy GM has learned its lesson. At least we hope that it has!

7. Tata — We’ve known for years that Tata Motors has been planning to sell its uber-cheap Nano in the United States. A European-spec model, the likely precursor of the U.S.-spec model, has been built. However, it still hasn’t been sold. Tata has been exporting its cars to other emerging markets and it seems likely it will continue to find markets where competition is thin in the ultra-low-cost entry-level market. As for a U.S. model of any kind, Tata may be content with managing its Jaguar and LandRover brands, highly profitable lines for this Indian car company.

The U.S.-spec Tata Nano is not ready for prime time.

Other Brands

There are scores of other brands around the world that either have a more localized presence or simply have little interest in entering the highly-competitive and expensive U.S. market. Maruti, an Indian automaker controlled by Suzuki, is busy expanding its presence throughout this vast republic of 1.3 billion people. Russian and Chinese manufacturers may someday sell cars stateside, although it seems likely that a Chinese brand such as BYD will set up shop here first. Brands that don’t make it to the U.S. need not look longingly at the U.S. market as the cost of entry is too high and the competition fierce.