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The Latest News And Reviews
Throughout The Car Industry

Categories: Car News

Closing of Mercury Will Cost Ford $500 Million

On: Mon, Jul 26, 2010 at 4:22PM | By: Sherry Christiansen

Closing of Mercury Will Cost Ford $500 Million test 1-1

Closing Mercury will cost Ford nearly $500 million, Ford CFO says.  A June auto news reported that Ford Motor Company plans to stop the production of the 71 year old brand, Mercury in the fall of 2010, and then sell the remaining Mercury inventory by the end of the year, a decision that according to a recent GM Inside News Report, could cost Ford nearly $500 million as stated by Ford CFO Lewis Booth.

Booth told Automotive News that “Ford took special charges of $247 million in the first half of 2010 to cover the cost of ongoing dealer reductions and shuttering the Mercury brand. He estimates the total cost to close the brand will be twice that amount.”

Booth also stated that 700 of the total 1,700 Mercury Franchises have already signed an agreement to close up shop after being offered cash compensation which accounts for the lion’s share of the expense that Ford will incur to close Mercury down.  When the original announcement was made back in June, Ford announced that it would be presenting a termination agreement with a buyout that included approximately $200,000 per dealership.

 “The plan is in place and we're having very fruitful discussions with our dealers,”

World's Fastest Production Car Battle Heats Up

On: Mon, Jul 26, 2010 at 9:17AM | By: Chris Weiss

World's Fastest Production Car Battle Heats Up  test 1-1

On a bright, sunny July 3 afternoon, Bugatti driver Pierre Henri Raphanel slowly fastened his helmet, pulled his racing gloves over his digits, and took the wheel for what would become a run of legend. With more than a little help from the ginormous, grumbling 1,200 hp W16 engine of the flamboyant, black-and-bright-orange Bugatti Veyron 16.4 Super Sport, Raphanel set a new production car world speed record that was verified by the Guiness Book of World Records, who were there to witness the feat. His time? 268 mph, a full 12 mph over the previous record held by SSC Ultimate Aero TT. The only trouble for Bugatti now is that SSC is back with a new and improved Ultimate Aero and has its sights set squarely on Bugatti's new record. We'll see what type of supercar they'll be challenging it with in just a few short weeks.

Ford Reports Second-Quarter Profits Up 13%

On: Mon, Jul 26, 2010 at 8:56AM | By: Sherry Christiansen

Ford Reports Second-Quarter Profits Up 13% test 1-1

Contrary to what many financial analysts predicted, Ford Motor Company’s second-quarter profit has reached $2.6 billion, a 13% increase, marking the fifth quarter in a row that Ford has been able to report the good news. Sales have been up for Ford Motor Co. as a result of the new redesigned the Taurus, and many new fuel efficient models that have been launched this year, which have shown that Ford continues to be a success in the marketplace.

Ford’s total sales climbed to $31.3 billion, which is quite an increase over last year’s numbers, which were reportedly only $27.2 billion.

In a recent conference call, Ford’s CEO Alan Mulally stated, “Overall, our performance this year gives us great confidence going forward.”  He continued, “We are ahead of where we thought we’d be.”

Paying off debt has been a big goal for Ford and analysts say if the company continues the track record it has set so far this year, that goal should be attained by the end of 2011. According to analyst Shelly Lombard: “It can give the company more flexibility and ultimately improve the way they’re perceived on Wall Street.”

Analysts predicted a 41-cent rise in stock shares but Ford reports stock earnings at 68 cents per share, to $12.73. Ford shares had fallen as low as $1.26 in 2008.

According to a recent Associated Press article posted on www.kval.com, Ford, which had mortgaged everything to avoid taking government bailouts as well as bankruptcy, is now “reaping big rewards and stealing business from stumbling rivals.”

Ford Prices Hybrid Lincoln MKZ Hybrid the Same as Gas Version

On: Fri, Jul 23, 2010 at 10:02AM | By: Chris Weiss

Ford Prices Hybrid Lincoln MKZ Hybrid the Same as Gas Version test 1-1

Ford Motor Company announced the pricing on the 2011 Lincoln MKZ sedan today, and the company says that it will "make history" by offering the hybrid sedan at the same $35,180 base price as the gas-powered Lincoln MKZ. Lincoln will be the first luxury automaker to offer a hybrid at the same price as its gas-based sibling. Ford demonstrates its commitment to hybrid vehicles, and consumers have one more reason to carefully consider a greener means of transportation.

Ford calls the MKZ Hybrid "America's most fuel-efficient luxury sedan," a midsize sedan that delivers an EPA-certified 41 mpg. The car uses Ford's second-generation hybrid technology, which centers around a 2.5-liter Atkinson-cycle I-4 hybrid engine, an engine that earned recognition as one of Ward's 2010 "10 Best Engines." The car delivers fuel economy of 41 mpg on highways and 36 in the city while offering 191 hp. It is capable of driving at speeds up to 47 mph on all-electric propulsion.

The V6-powered MKZ offers 18/27 mpg while delivering 263. 

The MKZ Hybrid offers a variety of green features, including SmartGuage with EcoGuide, a technological display system that helps drivers to maximize their fuel efficiency, and eco-friendly wood trim. Premium features include the Lincoln Sync vehicle Bluetooth communications and entertainment system, memory seat function, heated/cooled front seats, and keyless entry.


Bill to Electrify Half of U.S. Auto Fleet Passes Senate Committee

On: Thu, Jul 22, 2010 at 9:46AM | By: Chris Weiss

Bill to Electrify Half of U.S. Auto Fleet Passes Senate Committee  test 1-1

An electric vehicle bill sponsored by Senator Byron Dorgan (D-ND) passed the Senate Energy and Natural Resources Committee today in a vote of 19 to 4. Called the "Promoting Electric Vehicles Act of 2010," the bill aims to provide the financial incentives necessary to turn half of the vehicles on U.S. roadways into plug-ins by 2030. While easily passing out of committee, the bill faces an uncertain future with the current Senate term winding down toward an August recess and November elections.

Democrats are considering combining the bill with a greater package of energy and climate legislation to be presented on the Senate floor. They're hoping to push that legislation through the Senate in the near future, before recesses in mid-August and November interrupt their plans.

Auto Sales May Reach Highest Mark In Two Years As Retail Franchises Close

On: Thu, Jul 22, 2010 at 9:40AM | By: Sherry Christiansen

Auto Sales May Reach Highest Mark In Two Years As Retail Franchises Close test 1-1

After closing thousands of small dealerships in the U.S. auto retailers project that they may post the highest profits in nearly two years.

Auto Nation Inc, the largest dealer group, may post $3.06 billion in second-quarter sales when it reports earnings, which would be the highest revenue since the third quarter of 2008. Penske Automotive Group Inc. and Sonic Automotive Inc., the second- and third-largest retailers, may post the highest sales in two years July 29th according to approximations by financial analysts.

When General Motors and Chrysler closed 2,800 dealerships last year as part of a restructure program after bankruptcy, the two automotive giants announced that the goal was to be able to sell more vehicles at the surviving retail locations.
Many people have condemned the auto franchise closings stating they added to the already high unemployment rate, but dealer groups report otherwise, that the stores were financially failing anyhow and by closing them, more profit was allowed for the surviving stores.

“We’re seeing the remaining stores do significantly better,” Greg Young, Sonics’ vice president of finance, stated. “In markets where other Cadillac or Chevy dealers closed, our Cadillac or Chevy stores are doing much better.” Better translates to $1.7 billion estimated in second-quarter sales.

GM Awards $2 Billion To Hewlett-Packard For Technology Contract

On: Thu, Jul 22, 2010 at 9:23AM | By: Sherry Christiansen

 GM Awards $2 Billion To Hewlett-Packard For Technology Contract  test 1-1

General Motors has approved a $2 billion contract with Hewlett Packard (HP), which will maintain the companies' partnership that was established over two decades ago. In a recent press release, HP spokesperson was quoted as saying that this agreement will extend the two companies' 25-year relationship.

According to HP, the company will "manage GM’s technology infrastructure with a focus on providing an enhanced and continuously improving world-class end-user experience." Translated, that means that HP will integrate its own technology into GM platforms, including OnStar.

“The automotive industry is in the midst of a transformation and GM’s technology infrastructure needs to be hitting on all cylinders to take full advantage of the potential market opportunities,” Tom Iannotti, HP senior vice president and general manager, said in a company release. “HP has a track record of outstanding service to GM that we will continue to deliver to help GM realize their business objectives.”

Not only does HP provide apps for GM’s auto technology in new vehicles, the company also provides data and financial management for GM.

Volkswagen Plans Leading Role in Hybrid/EV Market

On: Thu, Jul 22, 2010 at 9:18AM | By: Chris Weiss

VW E-Up! Concept  test 2

Look around the U.S. market today, and you won't see a single Volkswagen hybrid or electric vehicle. You'll have to wait until later this year for that, when the 2011 Touareg hybrid becomes available. While Volkswagen AG has battled with Toyota for the title of world's largest car maker in recent months, it has lagged well behind Toyota and other manufacturers in terms of hybrids and electric vehicles. VW plans to remedy that situation with a barrage of hybrid and electric launches over the next three years, hoping to become a leader in the green auto market.

"I am deeply convinced Volkswagen will play a key role in electrifying the automotive world," VW CEO Martin Winterkorn said at a press conference yesterday. He spoke at VW's Electronics Research Laboratory in Palo Alto, CA, where he was for a 2011 Jetta launch event.

Winterkorn plans to back up this broad statement with a steady stream of hybrid and electric car releases. Following the recent debut of the hybrid Touareg, VW will launch a hybrid Jetta in 2012 and a Golf and Passat in 2013. In terms of EVs, Volkswagen will launch an E-Golf and E-Up! in 2013. An electric Jetta is also planned. 

Other brands within Volkswagen AG will also be introducing electrics and hybrids over the coming years, as well, including the Audi e-tron, Audi Q5 Hybrid, Porsche Cayenne Hybrid and, possibly, the Porsche 918 Spyder Hybrid.

2011 Ford Explorer Heads to the Top of the Class in Fuel Economy

On: Wed, Jul 21, 2010 at 10:58AM | By: Chris Weiss

2011 Ford Explorer Heads to the Top of the Class in Fuel Economy  test 1-1

Ford announced today that the upcoming 2011 Explorer will be the leader in fuel efficiency for the midsize SUV class. When equipped with Ford's 2.0-liter EcoBoost engine, the new Explorer will deliver a 30 percent increase in fuel economy over the outgoing V6-equipped model, offering up to 26 mpg. The Explorer is set for a debut on Facebook within the next week and will make its physical debut in New York City on July 26.

The EcoBoost engine that will deliver the Explorer's class-topping numbers is a 2.0-liter V4 that features both direct injection and turbocharging. In addition to the EcoBoost engine option, Ford uses a variety of technologies including electric power-assisted steering, battery management, fast engine warm-up, and a variable-displacement air conditioning compressor to increase fuel efficiency while enhancing drivability. Also helping, Ford has moved away from the truck-based, body-on-frame construction of past Explorers and toward car-based, unitized construction, which will cut weight over older models. The new Explorer is based on the same platform as the Taurus. Lightweight materials like boron and aluminum deliver further weight savings.

According to Ford, the 2.0-liter EcoBoost will deliver V6-level power while enjoying class-leading efficiency (EPA certification still pending). No specific output numbers have been given yet.

Chrysler Financial Plans to Make a Come Back

On: Wed, Jul 21, 2010 at 10:57AM | By: Sherry Christiansen

Chrysler Financial Plans to Make a Come Back test 1-1

After Chrysler and GM went bankrupt last year, GMAC (currently a company called Ally Financial Inc.) stepped in to take over for Chrysler Financial as the main lender for all of the Chrysler dealerships.

In recent auto news, Chrysler Financial is now considering a come-back in the lending industry with a primary goal to lend to consumers with “near-prime” credit, according to an anonymous source that talked to the Bloomberg News recently.  

“There's always a place for another lender,” said Maryann Keller, president of Maryann Keller & Associates in Stamford, Connecticut. “Chrysler Financial has to come up with a business plan that identifies who its dealer partners are and how the company will raise capital.”

In the past, Chrysler Financial operated as a “captive finance unit of Chrysler LLC” and not only offered retail loans, but also extended financing to dealerships that used the money to purchase inventory.

According to the Bloomberg news, Chrysler Financial was recently in contact with dealerships to find out how much interest there may be. One financial spokesman from Chrysler refused to comment on the future plans of Chrysler Financial.

The Reality About Electric Recharging Stations

On: Tue, Jul 20, 2010 at 2:50PM | By: Sherry Christiansen

The Reality About Electric Recharging Stations test 1-1

Manufacturers of electric cars would like to make the public believe that the infrastructure for charging electric vehicles is already in place, and that charging at home will not be a problem. The truth is that if car owners don’t have a special connector they will wait for long periods of time to recharge.

Although it’s true that electric charging stations do exist, particularly in select cities that were chosen to be the first to launch some of the electric models, they are not as prevalent as automakers may want us to think.

For apartment dwellers, plugging in will be very difficult; even finding a standard 110 outlet is not so easy for those in multi-family houses.

What many would-be electric car owners may not know is that it could take over 24 hours to charge their new EVs, particularly using a standard 110-volt outlet for power.

The Wall Street Journal published a recent article that described how difficult it is for the average home owner to cut through the bureaucracy in order to get the upgraded 220 charging stations installed in their residences. It can currently take many weeks for a city to issue the permits needed to supply the fast charger that will reduce the recharging time to between 4 and 8 hours for most models of electric vehicles. The price for the electric charging stations can be another hurdle, at $1,200 for a home charging station, to several thousand dollars for the fast charging posts.