DaimlerChrysler reveals new plans for
DaimlerChrysler AG tightened its control of beleagueredMotors Corp. Sept. 8 by renegotiating its purchase price for the Japanese automaker and installing Rolf Eckrodt, previous head of Adtranz, DC's former rail system subsidiary, as Mitsubishi's chief operating officer. Instead of increasing its 34% stake as had been anticipated, DC opted to lower its purchase price to $1.9 billion from $2.1 billion, or by 10%. As part of the agreement, expected to be finalized this month, DC will have the option to increase its stake in Mitsubishi after three years by an unlimited amount, possibly heralding a takeover. Analysts say DC avoided consolidating its struggling partner to sidestep being burdened with Mitsubishi's approximated $14 billion debt. The latest move comes in the wake of MMC President Katsuhiko Kawasoe's resignation over a product-defect coverup stretching back for decades. The scandal has caused MMC stock to lose more than 32% of its value. Takashi Sonobe, managing director in charge of MMC North American operations, succeeds Mr. Kawasoe. Mr. Kawasoe will remain on Mitsubishi's board, which has been increased to 11 members, including Mr. Eckrodt and three other DC executives.
details powertrain JV plans
The first project to be implemented by the powertrain joint venture established by this year'sSpA- Corp. alliance is an all-new 1.2L Multijet turbo diesel (MJTD) engine. Fiat will offer the engine first in 2002 in the updated Punto range. One year later, the highly efficient turbodiesel will be powering the all-new replacement of the current Fiat Seicento. But it will be tuned to deliver less power and further enhanced fuel economy. The small 1.2L, 4-cyl. 60-hp turbodiesel has a second-generation common rail fuel injection system developed by Magneti Marelli SpA. The engine is very flexible and smooth: its peak power is delivered as low as 3,500 rpm and maximum torque of 160 Nm (216 lbs.-ft.) coming at just 1,800 rpm. It will be built in the Bielsko-Biala, Poland, region. Some œ300 million (US$285.9 million) will be invested in the all-new plant.
Philippines auto industry wants tax structure fine-tuned
The Philippine Automotive Federation (PAF) wants the government to narrow the tax bracket gap in order to give it more flexibility in marketing its cars to specific buyer groups. There currently are four excise tax brackets for vehicles, depending on engine size: 15% for 1.6L or lower engine displacement; 35% for 2L; 50% for 2.8L, and 100% for greater than 2.8L. The group is asking the government to create more tax brackets or cut the difference between each bracket. Additionally, the auto industry is proposing a major overhaul of the tax system, although it admits the move would take a long time to implement and even longer to gain a consensus. Some want excise taxes to be based on the pure value of the car (selling price) as is the practice in the U.S., while others prefer taxes be based on the car's full dimension (wheelbase and length) as in Japan. The industry also maintains that not all vehicles should be considered a luxury item subject to an excise tax, noting that consumers buy vehicles for personal transport to their work or for their business. Currently, half of the price of new cars in the Philippines goes to taxes and duties.
Korea's Daewoo delays bringing Korando to U.S. Daewoo Motor Co. Ltd. delays bringing the Korando sport/utility vehicle (SUV) to the U.S. market, perhaps indefinitely, company officials say. The South Korean automaker, on the brink of being bought out byMotor Co. after a drawn-out auction process, originally planned to bring the Korando to the U.S. market in May or June of this year. Now officials say that it may come in 2001, but that, too, is questionable. The 2-door SUV, now sold in Korea and some Eastern European countries, resembles a Jeep Wrangler in size as well as styling. It is powered by a 3.2L V-6 engine built in Korea under a licensing agreement with Mercedes-Benz. The automaker had hoped for sales of 15,000 units in its first year, eventually reaching the 20,000 to 25,000 range.