foresees more U.K. losses Honda Motor Co. Ltd. is forecasting continuing U.K. losses this financial year, but says it will forge ahead with expansion plans in the hope of boosting exports. The No.2 Japanese automaker says in published reports that its U.K. losses rose 20% to nearly 60 million ($90 million) in the year ended March 31, 1999. The company sites a downturn in major markets, the strength of the pound and yen versus the euro, low consumer confidence and market uncertainty as contributing to the region's slump. Honda closed down its U.K. engine production last fiscal year, which also contributed to its losses. The automaker nevertheless is investing in a new car plant next to its existing Swindon site in south-central England. A company spokesman says investment costs have hurt earnings, but that the new plant is needed to raise productivity and combat the strength of the pound sterling against the euro and the yen. The plant will produce Honda's CR-V sport/utility vehicles and the 3-door Civic. Honda expects to export 70,000 CR-Vs a year to North America, with production to begin in 2002. Civic production begins this summer, with some 10,000 annual units earmarked for Japan.
Mercedes' global sales hit all-time record DaimlerChrysler AG's Mercedes-Benz division hit an all-time high for global sales in 2000, and the automaker says it may even top those sales this year. Mercedes sold a record 1.05 million vehicles during the year. Juergen Hubbert, board member in charge of passenger cars for Mercedes and Smart divisions, credits much of the success to the new C-Class. The automaker sold 148,000 units last year. "For us, the new C-Class family really is a fantastic success," Mr. Hubbert says, noting the vehicle was designed to attract younger customers and more female buyers. The Mercedes S-Class sedan also enjoyed a successful year, with sales of 108,400 units in 2000, making it the best year ever for the sedan. The M-Class sport/utility vehicle saw increased sales, as well, selling 104,500 units compared to 91,000 in 1999. The controversial A-Class saw some trouble during the year, with sales down to 199,500 units from 207,000 units in 1999. However, the much-maligned Smart car sales jumped 28%, surpassing its goal for the year by selling 102,000 units.
, Peugeot agree to explore Indian sedan Tata Engineering and Peugeot Citroen of France, Europe's second-largest automobile manufacturer, reportedly plan to examine the feasibility of jointly developing a car for the Indian market. This is the first such joint agreement in car manufacturing for Tata, in which DaimlerChrysler AG holds a 10% stake. The new car will be based on the French automaker's platform but will be built by Tata and may be considered for overseas markets, the company says. The two automakers agree to complete the feasibility study over the next six months. Should things go well, the new car could be produced by early 2003, reports say. Though the intent is to progress to a firm venture beyond the feasibility study, no equity participation by Peugeot currently is planned. Instead, the proposal focuses on development, with the cost to be borne by both parties, and license manufacture. There are no plans to spin off the car project into a separate company. The tie-up will be confined to the new sedan and will not influence the scheduled introduction of the Tata Indica car variants or the debut of the in 2002.
Delphi closes Brazil plant Delphi Automotive Systems Inc. is closing a plant in Brazil and firing about 450 employees in an effort to reduce costs as its largest customers produce fewer vehicles. The plant, located in Betim, Minas Gerais state, made dashboard consoles and wiring systems for brakes, dashboards, doors and lights fordo Brasil SA. The Betim operations will be consolidated with a factory in Itabirito, Brazil. Delphi, based in Troy, MI, was spun off from Corp. in 1999 and reportedly employs about 6,000 people in Brazil and Argentina. The Brazil plant closure comes despite an upswing in automobile manufacturers' activities in Brazil, the world's 10th-largest market for cars. Brazil's economy has been rising steadily since the crippling devaluation of its currency in 1999. GM opened its new Celta compact car plant last year, while Fiat opened a $240 million light truck and van plant in Brazil in November, betting on increased demand for its vehicles. Motor Co. is building a small-car plant in Bahia.