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Weekly Recap: Marchionne's Manifesto again calls for industry consolidation

Sergio Marchionne isn't taking no for an answer. Despite public rebuffs from General Motors and Ford, the leader of Fiat Chrysler Automobiles continues to push for consolidation within the auto industry. His latest assertion came Wednesday when he said a combination of FCA with another automaker could net savings of $5 billion or more annually. No, this isn't about selling his company, he claimed, it's about cutting costs. Put simply, the auto industry wastes money, Marchionne said during FCA's earnings conference call. Companies invest billions to develop basic components that all cars use, but many consumers don't care how they work or recognize the differences. "About half of this is really relevant in terms of positioning the car in the marketplace," he said. "The other half, in our view, is stuff which is neither visible to the consumer nor is it relevant to the consumer." In 2014, top automakers spent more than $100 million on product development, FCA estimated. Marchionne said consolidation could save up to $1 billion on powertrains alone, noting that almost every automaker offers four- and six-cylinder engines. Not everyone has to make their own, he contended. "The consumer could not give a flying leap whose engines we are using because they are irrelevant to the buying decision." That's pretty provocative for enthusiasts, but less so for average consumers. Still, there are major differences in power and efficiency ratings, even among similar engines. Skeptics could argue consolidation would also weaken competition and reduce choices for car buyers. Marchionne stressed his presentation, curiously entitled Confessions of a Capital Junkie, wouldn't require closing factories or dealerships. It's not his final "big deal" as CEO, intent to sell FCA, or a way to elevate his company up the automotive food chain. He claims he wants to fundamentally change the industry and its habit for burning cash. "The horrible part about this, and the thing that I find most offensive, is that the capital consumption rate is duplicative," he said. "It doesn't deliver real value to the consumer and it is in its purest form, economic waste." Other News & Notes Ford Profits dip in first quarter Ford profits fell $65 million to $924 million in the first quarter, hampered by slight dips in revenue and sales.

Expert: 54.5 mpg CAFE standard can be reached without many plug-ins

Johnson Controls executive Brian Kesseler isn't likely to get any holiday presents this year from Nissan chief Carlos Ghosn or Tesla Motors head Elon Musk, but lots of other folks might be happy with what he has to say about automakers' efforts to reach stricter fleetwide fuel-economy standards. Speaking at the Automotive News World Congress, Kesseler said automakers wouldn't need to sell an extensive number of plug-in vehicles in order to meet the 54.5 mile per gallon Corporate Average Fuel Economy (CAFE) standard the US government set in 2012 for 2025 model-year vehicles. In fact, he said, components such as stop-start engine technology, turbochargers and direct injection may actually do the trick. Already, things like smaller engine sizes and lighter cars are already playing major roles in spurring fuel-efficiency gains. Of course, Johnson Controls sells batteries specially built for stop-start systems, so Kesseler does have a bit of skin in this game. The 54.5-mpg CAFE standard equates to about a 40-mpg "real world" fuel-efficiency level. To put that into perspective, the Environmental Protection Agency (EPA) said in a report late last year that model-year 2013 average fuel economy was an even 24 mpg. That was up from 23.6 mpg for the 2012 model year and 22.4 mpg for 2011. News Source: Automotive NewsImage Credit: AP Government/Legal Green Ford Fuel Efficiency mpg CAFE standards ecoboost johnson controls

Autoblog's June 2019 Editors' Picks

Each year we review, test and rate hundreds of brand-new cars, trucks and SUVs. We rate these vehicles using the Autoblog score, giving a select few our Editors’ Pick. Here are the best cars we drove in June 2019. 2019 BMW 8 Series Everyone on the Autoblog staff loves a good grand tourer, so we were excited to get behind the wheel of the revived BMW 8 Series, specifically an M850i Coupe. A good GT needs to be as fast as it is stylish and comfortable, and the new 8 Series delivers. We particularly like the 523-horsepower twin-turbo 4.4-liter V8Â’s copious power and smooth ride quality, even on MichiganÂ’s pockmarked post-winter roads. We dig the interior design, too, though not everyone was in love with the exterior. ItÂ’s not the best-handling car in its class, and doesnÂ’t hide its sizable proportions very well, but itÂ’s still worth a look if youÂ’re looking for a big, fast cruiser.  2019 Ford Expedition Crossovers may be the hottest vehicles on the market, but thereÂ’s still a sizable demand for traditional body-on-frame SUVs like the Ford Expedition. These behemoths offer plenty of space in addition to truck-like capability. We like the Expedition's smooth ride, powerful twin-turbo V6 and sharp exterior design, though the interior can feel a bit cheap, especially on some of the more expensive trims. Adding options quickly puts it into Lincoln Navigator territory, and itÂ’s hard to recommend the Ford over the Lincoln when the latter packs the same capability into a far nicer package. Still, the Expedition is as good or better than the competition in most respects, and thatÂ’s why itÂ’s one of our picks. 2019 Toyota 86 Few cars at any price point are as much fun as the Toyota 86 (and its twin, the Subaru BRZ). We like the 86Â’s balanced chassis and sharp steering, and while itÂ’s not as nimble as its close rival the Mazda MX-5 Miata, the ToyotaÂ’s back seat and trunk make it a more usable vehicle. But while we like the 86Â’s driving position, the rest of the interior feels cheap and dated, especially the infotainment system. We complained about the anemic powertrain back in 2012, and itÂ’s only gotten worse as the years have gone by.