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Tier 1 suppliers call GM the worst OEM to work with

Among automakers with a big US presence, General Motors is the worst to work for, according to a new survey from Tier 1 automotive suppliers, conducted by Planning Perspectives, Inc.
The Detroit-based manufacturer, which has been under fire following the ignition switch recall and its accompanying scandal, finished behind six other automakers with big US manufacturing operations. Suppliers had issues with trust and communications, as well as intellectual property protection. GM was also the least likely to allow suppliers to raise their prices in the face of unexpected increases in material cost, all of which contributed to 55 percent of suppliers saying their relationship with GM was "poor to very poor."
GM's cross-town competitors didn't fare much better. Chrysler finished in fifth place, ahead of GM and behind Dearborn-based Ford, which was passed for third place this year by Nissan. Toyota took the top marks, while Honda captured second place.

BMW warns profits will fall, plans $13.6 billion in cost-cutting

FRANKFURT, Germany — BMW said Wednesday that profits in 2019 will be "well below" last year's, and it will cut 12 billion euros ($13.6 billion) in costs by the end of 2022 to offset spending on new technology. The company said profits would be eroded by higher raw materials prices, the costs of compliance with tougher emissions requirements and unfavorable shifts in currency exchange rates. The Munich-based automaker also faces increased uncertainty due to international trade conflicts that could lead to higher tariffs. "Depending on how conditions develop, our guidance may be subject to additional risks; in particular, the risk of a no-deal Brexit and ongoing developments in international trade policy," said Chief Financial Officer Nicolas Peter. The company forecast a profit margin of 6 to 8 percent for its automotive business, short of the long-term strategic target of 8 to 10 percent, which it said still "remains the ambition" for the company if given "a stable business environment." BMW said it had no plans for layoffs even as it outlined cost saving measures that include dropping half of its engine variants as it seeks to reduce product complexity. The BMW, Mini and Rolls-Royce brands are to get a single sales division. Peter said that given the headwinds to earnings, "we began to introduce countermeasures at an early stage and have taken a number of far-reaching decisions." The company said the measures were needed "to offset the ongoing high level of upfront expenditure required to embrace the mobility of the future." Automakers around the world have faced heavy up-front costs for technology expected to change how people get from one place to another in the next decade. Those include electric cars and renting cars through smartphone apps. Yet the returns from such investments remain uncertain and auto companies face competition from tech firms such as Uber and Waymo. BMW made 7.2 billion euros ($8.2 billion) in net profit last year, down 17 percent from 2017, when it booked a gain of $1 billion from U.S. tax changes. The company faced headwinds from increased tariffs on vehicles exported to China from the United States. It also suffered from turmoil on the German auto market when companies faced bottlenecks getting cars certified for new emissions rules. BMW faces uncertainty from U.S.-China trade tensions that could result in new tariffs if talks do not result in an agreement. U.S.

BMW i3 qualifies for both green and white HOV stickers in California

BMW buyers tend to have enough cash on hand to be buffered from the concept of "sticker shock," but the term may take on a different meaning when it comes to the German automaker's i3 plug-in vehicle and its classification by California clean-air regulators. The first i3 EVs are set to be sold in May, and some are questioning if the new car will be eligible for the state's white stickers or green High-Occupancy Vehicle lane stickers, both of which allow for solo-occupancy in HOV lanes. California gives out white stickers to some types of battery-electric vehicles, compressed natural gas (CNG) vehicles and hydrogen fuel-cell vehicles, and there's currently no limit on the number that can be given out. The green stickers, which are applied to other battery electrics as well as some plug-in hybrids, are limited (there are currently about 15,000 left) and will likely run out within the next year or two. The i3's status is uncertain because of it has an optional gas-powered range-extender. Jacob Harb, head of electric vehicle operations and strategy for BMW, told AutoblogGreen that it's not all that complicated. The pure electric version of the i3 will get the white sticker, the REx version will get the green sticker. He also said that both will qualify for the $2,500 state incentive in California and the $7,500 federal tax credit available in all 50 states (For what it's worth, Green Car Reports says the REx version will only get $1,500 from California). Read Autoblog's First Drive impressions of the i3 here.