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Trump reportedly says he wants to wipe German cars off the U.S. map

BERLIN/FRANKFURT — A report that U.S. President Donald Trump has threatened to pursue German carmakers until there are no Mercedes-Benz rolling down New York's Fifth Avenue dented shares in the luxury car manufacturers on Thursday. An excerpt from German magazine Wirtschaftswoche's article, which cited several unnamed European and U.S. diplomats but did not include any direct quotes, could not be independently verified, while a U.S. Embassy spokesman in Berlin referred questions to Washington. The news and current affairs magazine said Trump had told French President Emmanuel Macron in April that he aimed to push German carmakers out of the United States altogether. Macron's administration in Paris declined to comment on the report. The Trump administration last week opened a so-called Section 232 trade investigation into vehicle imports, which could result in a 25 percent tariff on cars on the same "national security" grounds Washington used to impose metals duties in March. This could destroy exports by German carmakers, which control 90 percent of the U.S. premium market and are the biggest European Union exporters of cars to the United States. BMW owns Rolls-Royce, while Daimler has Mercedes-Benz, and Volkswagen controls Bentley, Bugatti, Porsche and Audi. Daimler, BMW and Audi declined comment. Porsche was not immediately available for comment. BMW shares were trading 0.5 percent lower at 0939 GMT, while Daimler and VW's shares were down 1 percent and 1.6 percent respectively, underperforming Germany's blue-chip DAX. Trump has railed against German carmakers before. And in early 2017, in an interview with German newspaper Bild, he said he would impose 35 percent tariffs on imported cars. At the time, the president called Germany a great car producer but said that the business relationship with the United States was an unfair one-way street. Germany's auto industry association VDA says its members exported 657,000 vehicles to North America last year, with total exports of vehicle components, cars, engines, as well as second-hand vehicles totaling 31.2 billion euros in 2016. Imports from the United States to Germany amounted to 7.4 billion euros, meaning a trade deficit of 23.8 billion euros the VDA's latest available figures show. However, German brands also have huge factories in the United States, where they built 804,000 cars last year, VDA said, providing jobs for U.S. workers. Berlin has reacted angrily to the U.S.

Vahland leaving VW over dispute on how to run NA region

On November 1, Winfried Vahland was supposed to take over Volkswagen Group's recently created North American region that combines Canada, the US, and Mexico. But the longtime exec has instead decided to leave the automaker after a dispute over how to manage the new combined region. Vahland is currently the boss at Skoda, and in a statement about his departure the Czech company said: "Differing views on the organization of the new Group region have led to this decision; this decision is expressly not related to current events on the issue of diesel engines." Vahland is leaving at his own request, the announcement says. Vahland was appointed to run to North American region during VW's massive corporate shakeup on September 25. The decision was part of the automaker's plan to put a greater emphasis on regions and brands, rather than on centralized authority. According to Automotive News Europe citing a report from Germany's Auto Bild, Vahland was passed over for the CEO job, with Matthias Muller taking that position. Amidst the changes, Michael Horn remained at the helm of Volkswagen Group of America, reporting to the new regional boss. Vahland joined the automaker in 1990 and started running VW's operations in China in 2005. He became boss at Skoda in 2010. "In the last 25 years, Prof. Vahland made a great contribution to the company. We respect his decision and thank him for his exceptional performance," Muller said in the departure announcement. Prof. Dr. Winfried Vahland leaves Volkswagen Group 14.10.2015 Prof. Dr. Winfried Vahland leaves Volkswagen Group Mlada Boleslav, 14 October 2015 – After 25 years of successful work in Volkswagen Group, most recently as Chairman of SKODA, Prof. Dr. Winfried Vahland is leaving the company at his own request. Prof. Vahland will therefore not be taking up the position of overall responsibility for the North American Region (NAR). Differing views on the organisation of the new Group region have led to this decision; this decision is expressly not related to current events on the issue of diesel engines. Prof. Vahland began his work in Volkswagen Group in 1990. After holding several key positions at home and abroad, he took over Group responsibility as President and CEO of Volkswagen in China in 2005 and contributed significantly to the successful new direction of Volkswagen in China. He was appointed Chairman of the Board of Management of SKODA in 2010.

VW exec calls US ops a 'disaster'

Today in the Tell Us How You Really Feel file we have Bernd Osterloh, head of Volkswagen AG's Group Works Councils and member of the company's supervisory board, labeling the company's US operations "a disaster." Why? Because Osterloh believes VW of America doesn't have the models it needs to be competitive here, hasn't been decisive enough about its plans and German higher-ups still don't understand the US market.
In truth, the top labor rep at the German conglomerate is echoing sentiments we've heard from VWoA executives for years, and there's been the same commentary from dealers: Germany doesn't pay enough attention to what the US market really wants. Even ex-VWoA CEO Stefan Jacoby, who preceded the recently departed Jonathan Browning, said early in his tenure that one of his tasks was to get his German bosses to start delivering what the US market demanded. New CEO Michael Horn is saying much the same thing seven years later, telling Sky News that it has to increase "the speed at which we bring new models to the market and innovation to the market."
Osterloh wants to get "more models" here, including a pickup truck, but we'd wonder if the economics have changed from when Jacoby said they'd need to sell 100,000 per year to make money. Osterloh also wants a decision on where the CrossBlue will be built. Although it looked as if the Chatanooga, TN plant would get the call, the Puebla, Mexico plant is still in the running because of lower operating costs. No matter what happens right now, Osterloh thinks the situation won't get better for another two years when revamped models arrive, but at least the company can start taking the steps for a better US future.