Auto blog

X4 launch to spearhead BMW crossover onslaught at NY Auto Show

It's no secret that crossovers are one of the key vehicle types driving today's auto industry profits, and nowhere is that more true than among the world's luxury brands. BMW became one of the first players in the luxury CUV segment when it launched its original X5 in 1999, and buoyed by that model's runaway success, it followed up with the X3 in 2003, the X6 in 2008 and the X1 in 2009 (though the latter didn't make it to the US until late 2012). It's replaced the X5 twice since then and the X3 once, but the Bavarian automaker isn't about to let matters rest there.
First off, a production version of a new X4 model is expected at the New York Auto Show in April. The model was previously rumored to be earmarked for reveal a month earlier, but a new report from Autocar suggests that the previously mooted reveal date and location were inaccurate. The X4 is expected to apply the same controversial slant-back formula to the X3 that transformed the X5 into the X6, which will in turn lead to an update for the X3 as well.
But that's not all. Autocar also reports that before 2014 is out, BMW will unveil a revised X6 at the Moscow Motor Show in August, which will in turn be followed by upgraded versions of both the X6 M and X5 M. These high-performance crossovers are tipped to pack the same 4.4-liter twin-turbo V8 as the outgoing versions, albeit with higher outputs than the current models' 555 horsepower and 500 pound-feet of torque. All this, and they're still expected to simultaneously improve fuel consumption and emissions figures.

Foreign automakers pay from $38 to $65 per hour to non-union workers

As leaders for the United Auto Workers gather in Detroit for their Special Convention on Collective Bargaining to work out the negotiating stance for this year's new labor agreements with the Detroit 3 automakers, what they most want to do is figure out how to eliminate the two-tier wage scale. However, the lower Tier 2 wage has allowed the domestic automakers to reduce their labor costs, hire more workers, and compete better with their import competition. As it stands, per-hour labor rates including benefits are $58 at General Motors, $57 at Ford, and $48 at Fiat-Chrysler – a reflection of FCA's much greater number of Tier 2 workers. The Center for Automotive Research released a study of labor rates (including benefits) that put numbers to what the imports pay: Mercedes-Benz pays the most, at an average of $65 per hour, Volkswagen pays the least, at $38 per hour, and BMW is just a hair above that at $39 per hour. Among the Detroit competitors, Honda workers earn an average of $49 per hour, at Toyota it's $48 per hour, Nissan is $42 per hour, and Hyundai-Kia pays $41 per hour. The lower import wages are aided by their greater use of temporary workers compared to the domestics. Automotive News says the ten-dollar gap between those foreign camakers and the domestics turns out to about an extra $250 per car in labor, which adds up quickly when you're pumping out many millions of cars. That $250-per-car number is one that, come negotiating time, the Detroit 3 will want to reduce, as the UAW is trying to raise both Tier 1 and Tier 2 wages. Another wrinkle is that the domestic carmakers are considering the wide adoption of a third wage level lower than Tier 2. Some workers who do minor tasks like assembling parts trays kits and battery packs already make less than Tier 2, but the UAW will be quite wary about cementing yet another wage scale at the bottom of the system while it's trying to fight a bigger battle at the top. News Source: Automotive News - sub. req., BloombergImage Credit: AP Photo/Erik Schelzig Earnings/Financials UAW/Unions BMW Chevrolet Fiat Ford GM Honda Hyundai Kia Mercedes-Benz Nissan Toyota Volkswagen labor wages collective bargaining labor costs

Will global automakers drop local JV partners if China's government says they can?

Chinese economic policies could be in for a big change, as President Xi Jinping pushes the communist country to open its domestic markets even further. That could mean big things for the auto industry, especially when it comes to the country's far-reaching joint-venture system.
According to Chinese law, foreign automakers may only maintain a fifty-fifty partnership with their domestic counterparts. But with Jinping's push for openness leading to potential free-trade deals, that policy could be relaxed (or eradicated all together) in short order. What's an automaker to do?
Well, in BMW's case, stay the course. Automotive News Europe reports that, despite the grumblings about the JV policy changes, the German manufacturer has resigned its agreement with Brilliance through 2028. This is made doubly remarkable by the fact that BMW signed the extension over three years before it was set to expire.