Cancel that off-site; postpone that trip; GM hoards cash
A war chest of $13.6 billion would appear adequate to outlast the UAW, butCorp. is taking no chances. Vice Chairman Harry Pearce and Chief Financial Officer J. Michael Losh signed a memo to executives urging them to establish a process to trim discretionary spending for such items as overtime, consultants, travel, off-site meetings and even food and beverage service. Among the first casualties: an annual reception for thousands of summer interns.
teams up with Republic in Rochester
Motor Co. and Republic Industries Inc. will set up a jointly owned retail network covering eight Ford and Lincoln Mercury dealerships in the Rochester, NY, area. Ford has formed similar ventures with its dealers in Tulsa, OK; San Diego, and Salt Lake City. But this marks the first time it has partnered with the Republic, which operates more than 300 new-car franchises accounting for about 1% of the new car market in the U.S. The Rochester plan calls for consolidating eight existing showrooms into two or three mega-stores, with a larger number of service centers.
UAW names King to VP of organizing
Recognizing that its inability to organize more independent suppliers in the U.S. weakens its leverage when taking on large original equipment manufacturers, especiallyCorp., the UAW has appointed its Region 1 director, Bob King, to the new post of vice president of organizing. The move was approved at the UAW's triennial convention in Las Vegas in June. Sources close to the union say Mr. King will have up to $25 million annually to support his efforts, a considerable increase over what the UAW has spent in recent years to organize suppliers.
Ford and Kia near a deal; it's just a matter of price
It's not a question of whether Ford will buy a larger stake in Kia Motors, but rather how much of the Korean automaker Ford will control, says Richard Macedo, vice president of sales and marketing for Kia Motors America, which is introducing a convertible 2-door version of its Sportage mini-sport/utility vehicle. Ford continues to deny a deal is imminent. But Kia's government-appointed chairman has until Aug. 31 to restructure the company.
GM restarts truck JV with First Auto Works-Jinbei in China
GM has reached an agreement with partner First Auto Works-Jinbei to invest $230 million to resume production of a revised S-10 pickup truck at a Shenyang, China, plant the partners idled in 1995.
settles harassment suit; studies new model, sees debt drop to "junk" status
Motors Corp. agrees to pay $34 million to settle a sexual harassment lawsuit brought by more than 300 women at its Normal, IL, factory. Filed in April 1996, the case covers far more employees than any previous sexual harassment case. Separately, Pierre Gagnon, executive vice president and chief operating officer of Mitsubishi Motors Corp., says the company may build a new cross-over vehicle at the Illinois plant to compete with vehicles such as RAV4, CR-V and Lexus RX300. Meanwhile, Standard & Poor's downgrades Mitsubishi's long-term debt to "junk" status. S&P warned that the company "faces major ongoing uncertainties which could lead to inadequate capacity to meet its financial commitments."
More insurers may sue Ford over faulty ignition switches
The legal wrangling continues between automobile insurance companies and Ford Motor Co. over that 8.7 million-vehicle recall stemming from a defective ignition switch that, in some cases, caused fires. A group of five insurers, led by Western Reserve Insurance Co. of Wooster, OH, filed notice in June in U.S. District Court in Camden, NJ, that they will file a class-action suit. Ford spokesman Jim Cain says the company is willing to pay for losses caused by the ignition fires, but it opposes granting class-action status to insurers or vehicle owners because not all of the alleged fires were caused by the faulty ignition, which was supplied by United Technologies Automotive.
Moulton named new presidentofAutomotive Group
John Moulton has been named president of the Automotive Group of RobertCorp. He succeeds Helmut Schwarz, who has been appointed executive vice president of the company's on-board electronics division in Schwieberdingen, Germany. A graduate of Worcester Polytechnic Institute, Mr. Moulton will be responsible for Bosch's original equipment business in the U.S. That does not include Bosch's braking unit, which is managed by Hans Weckerle, president of Bosch Braking Systems North America. He will report to Robert Oswald, chairman and chief executive officer of Robert Bosch Corp.
Faster charges coming for GM's EV1
GM is close to releasing a new 50-kW inductive charging device that could trim the time needed to fully charge one of its battery-powered EV1s from three hours to about 10 minutes. The new system is being tested in southern California. It uses the principle of electro-magnetic induction. There are no metallic electrical connections to the vehicle. That would allow drivers to safely charge the EV1 in all weather conditions. Drivers would insert a weatherproof plastic paddle into the vehicle's charge port and juice up.
How does a 31-year-old pharmacy student pay for a Lamborghini Diablo?
John Martin, a 31-year-old Fort Lauderdale, FL, man studying to be a pharmacist, is suing Automobili Lamborghini SpA and a North Miami Beach dealer for fraud, breach of contract and other charges. It seems the $250,000 purple Lamborghini Diablo he bought was less than a contender for the J.D. Power Initial Quality Survey award. Among the allegations: The roof leaks, the battery quits without notice, the sunroof latches detach when he hits a bump and bops him on the noggin. Occasionally the doors and windows jam, leaving him at the mercy of strangers to help extricate him from his fantasy machine. "We have at the moment no response," says Harold Nathan, a New York attorney representing Lamborghini. Says Mr. Martin, "It's very embarrassing. You want to get this car to be the center of attention. But now you're the center of attention because you're a fool locked in a purple car." Next time read Consumer Reports.
buys AlliedSignal's half of catalyst JV
When it comes to the world's largest partsmaker and its U.S. operations,Automotive Systems usually is a seller. But the GM unit is buying out AlliedSignal's half of an automotive catalyst joint venture the two companies formed in 1994. Donald L. Runkle, general manager of Delphi Energy & Engine Management Systems, says the deal will round out Delphi's engine management parts lineup. Delphi's goal is to link the catalytic converter with its engine-management systems.
'Car of Century' goes on tour
It started with 200 candidates. Now it's down to 100. It's the international "Car of the Century" extravaganza, which aims to name a single winner by December 1999. As part of the hoopla, the 100 vehicles have been pulled together as a traveling exhibition, which started in Amsterdam in June. No U.S. site has been determined, but they'll go on display Aug.21 to Sept.7 at the Canadian National Exhibition center in Toronto.