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Mixed sales results, but automaker stocks rise on need for cars in Houston

DETROIT — The Big Three Detroit automakers on Friday reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their stocks higher. General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, while Honda fell 2.4 percent. Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands, perhaps hundreds of thousands, of vehicles after the devastation from Hurricane Harvey. Mark LaNeve, Ford's U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 "we saw a very dramatic snapback" in demand. That said, Ford sales fell 2.1 percent in August. It sold 209,897 vehicles in the United States, compared with 214,482 a year earlier. Sales were down 1.9 percent in the Ford division and off 5.8 percent at Lincoln. Demand was down for cars, crossovers and SUVs. It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford's Houston dealers may have lost fewer than 5,000 vehicles in inventory, he said. Ford is the No. 1 automaker in the Houston market, with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers and has "every indication we would have to add some production" of new vehicles to meet demand, LaNeve said. Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers' shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs. "It's got to be a positive for the industry," LaNeve said. Investors appeared to agree. GM shares rose as much as 3.3 percent to their highest since early March. Ford increased 2.8 percent at $11.34, and Fiat Chrysler's U.S.-traded shares were up 5.2 percent $15.91, hitting their highest in more than five years. GM reported a 7.5 percent increase in U.S. auto sales in August, helped by robust sales of crossovers across its four brands.

Toyota temporarily idles pair of Indian plants due to labor unrest

The Detroit News reported today that Toyota will restart production at two Indian plants, following a shutdown on Monday.
Factory labor, management and police in Asia engage in the kind of violent altercations that we're not used to, having almost entirely walked away from the overtly brutal relations epitomized by the Pinkerton Detective Agency and the Flint Sit-Down Strike. In India, a plant owned by a Ford transmission supplier plant was shut down in 2009 after incidents between workers and armed men around the same time as Ssangyong workers occupied a factory in South Korea, in 2012 Suzuki Maruti workers rioted over wages around the same time upset employees beat a ceramics factory president to death in retaliation for a labor leader's killing.
Toyota is the latest to company trying to avoid that road. The Detroit Free Press reported earlier this week that it shut down two plants in India after 11 months of acrimonious wage negotiations and arbitration have gone nowhere. Toyota said the plant workers in Bidadi, near Bangalore, had deliberately stopped production at times over the past 45 days and threatened management. The workers said they wanted their wages raised by an amount already agreed to by management, but that management had reneged; news reports weren't clear on the amount, some saying nearly 10,000 rupees ($165 US) more per month, another saying 4,000 rupees ($65 US), but reports agree that Toyota has said it will only go as high as 3,050 rupees ($50 US).

Subaru Viziv 2 presages Tribeca replacement with diesel hybrid tech

Subaru is in the middle of a new product bonanza. It has recent replacements for the Impreza and Forester at dealers, and soon we're getting the WRX, Legacy and if rumors are right the new Outback as well. Now, there are rumblings that there could be two more models from the Japanese brand on the way with styling inspired by the Viziv 2 concept from the Geneva Motor Show.
According to a company insider speaking with Motor Trend, the crossover concept shows the way for the brand's future design language. The shape would be used on a smaller CUV that is still being kept quite secret, and a second, larger one that would replace the recently axed Tribeca. The bigger model is the first priority and is planned as a new technology showcase.
It's rumored to use a turbodiesel, four-cylinder boxer engine that would be boosted with one electric motor on the front axle and two at the rear, with a plug-in hybrid system sourced from Toyota. It should provide a great mix of torque and fuel economy. A smaller flat-six engine would be a second powertrain option. Though the Viziv 2 concept only seats four, the production version would probably offer three rows.