TABLE OF CONTENTS
China to Tax US-made Car Imports in Trade Dispute
Toyota Raises Full Year Profit Forecast
Ahlstrom Acquires 49% Stake in U.S. Battery Separator Company
Honda Forecasts Profit Fall for 2011
Nissan Invests $2 billion for Third Plant in Mexico
Nissan Expects Leaf sales to Double in 2012
Audi China Output up to 700,000 Cars on New Foshan Plant
Toyota, BMW Announce Green Alliance
China will levy duties on some cars made in the US in the latest escalation of trade disputes between the two largest economies.
China's commerce ministry said in a statement that vehicles were being dumped on the Chinese market, causing damage to the domestic industry.
The taxes will affect models from General Motors, Chrysler, Mercedes Benz and BMW that have been made in the US.
China is now the world's largest vehicle market.
Individual duties on each company range from 2% to 21.5% and will be levied on imported cars and SUVs with engines larger than two litres for two years, the commerce ministry said.
The decision to tax US-made cars came after China lost a two-year battle over tyre exports to the US in September. The World Trade Organisation ruled in favour of the US and allowed a proposal to significantly increase duties on Chinese tyres coming into the US. It rejected an appeal from China that the 2009 duties were protectionist.
Carmakers reported strong January sales as Americans bought new vehicles ranging from big pick-up trucks to small economy cars.
All the big US and foreign manufacturers reported higher year-on-year sales last month, except for General Motors, whose sales fell 6 per cent as it cut back on incentive spending in a bid to improve the profits it earns on its cars and trucks.
GM, the US market leader, estimated that light vehicle sales for the overall market came in at an annualised rate of 13.5m to 13.6m in January, on a par with industry sales in December and in line with its own full-year estimates for 2012.
North America is now re-emerging as a source of growing sales and profits for automakers as they face declining demand for cars in Europe and slower sales growth in emerging markets.
Ford Motor, the second-biggest producer by sales, reported a 7 per cent gain in sales on January 2011.
Ford said that sales of its F-Series trucks, America’s best-selling vehicle, rose 8 per cent, but noted that smaller vehicles were selling well too. The Focus small car and Escape small sport utility vehicle accounted for half of Ford’s volume growth in January.
Chrysler, majority owned by Italy’s Fiat, reported its best January sales in four years, up 44 per cent on a year ago. North America now accounts for more than half of Fiat and Chrysler’s combined 4m-plus sales, and the US group on Wednesday reported an operating profit of nearly $2bn that propped up higher earnings at its Italian parent.
Toyota raised its full-year net profit forecast by 11 per cent to Y200bn ($2.6bn), citing an accelerating recovery from two natural disasters last year that severely disrupted its production.
Japan’s earthquake and tsunami in March and flooding in Thailand a few months later curtailed supplies of crucial parts and reduced Toyota’s output by about 400,000 vehicles, which cost the Japanese company its position as the world’s largest automaker.
But Toyota has put most of its supply issues behind it and expects to make a record number of cars and trucks in 2012 – 9.59m, including its Daihatsu and Hino subsidiaries, according to a separate company forecast issued this month.
Toyota still expects net profit for the financial year ending in March to be just half last year’s level.
Takahiko Ijichi, Toyota’s senior managing director, said he expected the reintroduction of Japanese government subsidies on low-emission cars this year to boost sales in Toyota’s home market. That would add to projected gains in China and in the US, where an updated version of Toyota’s mainstay Camry saloon drove a 7.5 per cent sales increase for the company in January.
Ahlstrom has signed an agreement to invest in Porous Power Technologies, LLC, a Colorado, U.S. based company developing technology for lithium-ion battery separators. Under the agreement, Ahlstrom will subscribe for approximately 49% of the shares in Porous Power while the remaining 51% of the shares will be held by the current owners of Porous Power. Ahlstrom has an option to acquire the remaining shares at a later stage.
Ahlstrom, together with Porous Power, will be offering a new generation of separator solutions for safer batteries and capacitors in electric-drive vehicles, e-bikes, portable electronics and utility-grade storage products. Porous Power's current separator products are already being evaluated by battery manufacturers around the world. The products for electric vehicles will be commercially available in larger scale later.
Battery separators, which keep the positive and negative electrodes (anode and cathode) from touching each other and short-circuiting, are vitally important in the performance and safety of electric vehicles. Ahlstrom has been developing lightweight nonwoven materials for lithium-ion membrane separators since 2008 and has worked closely with Porous Power for several years.
According to industry analysts, the overall market for lithium-ion battery separators is expected to grow to USD 2.5 billion in 2020 (approx. EUR 1.9 billion), mainly driven by the demand for electric vehicles.
"In line with our strategy, we are seeking growth opportunities in unique products, both in our existing businesses as well as in new technologies. Porous Power's membrane technology has high potential and is a good fit with our technology base. Ahlstrom will use its extensive know-how and experience in automotive industry to respond to the market needs in the fast-evolving electric vehicle business in particular," says Jan Lång, President and CEO, Ahlstrom.
The new investment will be part of Ahlstrom's Building and Energy Business Area.
Honda warned that its profits would fall by 60 percent this year as a result of a soaring yen and floods in Thailand that knocked out a big assembly plant.
The Japanese carmaker’s pessimistic forecast for the financial year ending in March predicted a net profit of Y215bn ($2.8bn), down from Y534bn last year and Y15bn below what it had projected until October’s Thai disaster.
Thailand has become a key production base for Japanese car companies, and Honda has been affected more severely than its rivals by the floods – the country’s worst in decades. While Toyota, Nissan and other groups suffered supply chain disruptions, only Honda lost an assembly plant.
The six-month shutdown and other flood-related supply disruptions are expected to cost the company 260,000 vehicles’ worth of production and Y110bn of profits, said Fumihiko Ike, chief financial officer. Honda’s net profit in the third quarter to December fell 41 per cent to Y47.6bn.
The floods came at a time when Honda and other Japanese carmakers were already struggling to cope with the effects of Japan’s earthquake and tsunami last March, as well as the yen’s surge to all-time highs against the dollar and the euro.
A strong yen makes exporting cars from Japan less profitable, which is largely why carmakers expanded operations overseas in countries such as Thailand.
Honda, for all its recent problems, expects to recover strongly this year. In the US, its largest overseas market, it predicts sales will rebound by a quarter on the back of updated versions of its Accord sedan and other key models. The expected restoration of the Thai plant will help it increase global production to 4m units for the first time, from 2.91m in disaster-hit 2011.
Nissan Motor Co. announced recently it is investing $2 billion to build a new manufacturing plant in Mexico. It will be the Japanese company’s third in the country, helping it serve markets throughout the Americas.
Construction of the plant in the northern state of Aguascalientes will begin this summer and production should start by the end of next year, according to a company statement. It said an industrial park for supplier companies also will be built.
The plant is projected to have the capacity to produce 175,000 vehicles a year, focusing on “B’’ platform vehicles. Those include the Versa, March and Tiida. The company says that will give Nissan the ability to produce 1 million cars a year in Mexico in the midterm.
Nissan already has two manufacturing centers in Mexico. A plant in Cuernavaca 50 miles (85 kilometers) south of Mexico City, produces small cars and light trucks, while an existing plant in Aguascalientes builds small cars for the Mexican, U.S. and Latin American markets.
Nissan manufactured more than 600,000 vehicles in Mexico last year, and it reported selling 1.56 million vehicles throughout the Americas, giving it a 7 percent market share for the hemisphere.
Nissan topped sales in Mexico last year with more than 224,000 vehicles, nearly 25 percent of the market.
Nissan said it expects to employ 3,000 workers, raising the company’s total workforce in Mexico to 13,500. It projects the new plant will create 9,000 other jobs indirectly.
Nissan recently announced it will build a new factory in Resende, Brazil, that is expected to open in the first half of 2014.
Nissan is expecting its Leaf electric car to reach a sales capacity of 40,000 units next year, a top executive told Financial Times.
Nissan says it has already sold more than 20,000 Leafs from the car’s debut in December 2010 to late November 2011. Most of the cars were sold in Japan and the United States. Andy Palmer, Nissan’s managing director of business strategy and corporate planning said Leaf sales were slightly behind expectations in 2011.
The Leaf’s launch was delayed by a month in the U.S. because of distribution problems, while the Japan earthquake and tsunami in March disrupted supplies of some of the electronic components used in the Leaf. On top of that, the Oppama plant in Japan that builds the Leaf closed for about three weeks.
Palmer added that orders for the car are strong and could determine Nissan to double sales to 40,000 in 2012, as the Leaf will be introduced in more European countries and U.S. states. “That’s our aim: to double that volume, which is basically buffering up against our capacity,” Mr Palmer was quoted as saying by the Financial Times. Nissan also plans to build the car at its U.S. plant in Smyrna, Tennessee and in Sunderland, England, from 2013.
Audi, Volkswagen AG’s luxury-car unit, will increase capacity in China to as many as 700,000 vehicles a year, backed by a second assembly plant.
A new factory in Foshan, in the southern province of Guangdong, will have a capacity to build about 150,000 to 200,000 cars from 2013, adding to output of a plant in Changchun which will be raised to as many as 550,000 cars, Audi said today in a statement. The Foshan plant is being built by VW and its Chinese partner FAW Volkswagen Automotive Co.
China has surpassed Germany as Audi’s biggest market this year though the Ingolstadt, Germany-based carmaker’s share of Chinese luxury-auto sales shrank in the first six months while German rivals Bayerische Motoren Werke AG and Daimler AG’s Mercdes-Benz boosted their portions, according to industry researcher J.D. Power & Associates.
Audi said the factory in Foshan will employ about 4,000 workers and produce a “new member” of the A3 compact line, the carmaker’s third-best selling model. The VW unit currently makes extended versions of the A4 and A6, its two best-selling vehicles, and the Q5 sport-utility vehicle in Changchun.
Audi, the luxury-market leader in China, increased sales of cars and SUVs in the world’s biggest auto market by 32 percent between January and October to 253,739 units. The carmaker aims for record sales of more than 300,000 in the Asian country this year.
Automakers Toyota and BMW have struck a partnership to share eco-friendly technologies, including in the joint development of lithium-ion batteries for next-generation electric cars, the companies said.
Under the deal, the German automaker will also provide diesel engines for Toyota as the Japanese auto giant looks to boost sales in Europe, where more than half of passenger cars are diesel powered.
Toyota has struggled to boost its European market share with its gasoline-electric hybrid vehicles, despite its leading position in the low-emission technology.
Meanwhile, the pair will share development costs for batteries for electric cars as part of plans to roll out battery-powered vehicles.
"Toyota Motor Europe (TME), Toyota Motor Corp.'s European subsidiary, and BMW have entered into a contract under which BMW is to supply 1.6 litre and 2.0 litre diesel engines to TME starting in 2014," they said in a statement.
"Through this agreement, Toyota plans to expand its European lineup and sales of fuel-efficient, low CO2-emission diesel-powered vehicles."
Demand for lower-emission diesel vehicles is forecast to grow, with further technological advances in the field seen as crucial due to toughening vehicle emissions standards.
"Supplying Toyota with our fuel efficient and dynamic diesel engines represents another important step in the planned expansion of our sales activities for engines and powertrain systems," BMW Chairman Norbert Reithofer said in the statement.
Their pact comes after Toyota struck a deal in August to develop hybrid-vehicle systems with US-based Ford, while BMW inked a deal with France's PSA Peugeot Citroen Group to jointly develop hybrid systems for subcompacts.