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United States drivers buying fewer Mexican-made cars

Crossovers and pickup trucks are not only growing in market share, they're also more profitable than cars. A crossover on the same platform as a sedan retails for thousands more, despite similar components. It's one of the reasons we've seen automakers rapidly shifting production of their sedans and hatchbacks to Mexico, where cheap labor preserves the thin profit margins on these inexpensive vehicles. But as the market continues to shift in the United States, Mexico is getting burned by its lack of product diversity. The country's auto exports, which are heavy on cars, suffered a 16-percent drop last month, Automotive News reports. In total, year-over-year exports fell from 233,515 to 197,020 last month, while year-to-date exports are down by 7.4 percent, from 922,029 to 854,118. The number one culprit? America – which usually accounts for 75 percent of Mexico's exports – and its appetite for crossovers and pickup trucks bolstered by cheap gas prices. While Mexico does build some light truck models – AN specifically calls out the Ram 2500, Honda HR-V, GMC Sierra, and Toyota Tacoma as export leaders – the vast majority of vehicles rolling out of its factories are sedans and hatchbacks. In fact, the three biggest drops in Mexican exports came from companies whose south of the border factories only build cars – Ford (Fusion/Lincoln MKZ and Fiesta), Mazda (Mazda3), and Volkswagen (Golf and Jetta). Mexican Automotive Industry Association President Eduardo Solis told AN the export shortfall will likely be sorted out sooner rather than later, thanks to a pair of new factories – a Kia car factory and an Audi SUV plant – that are coming online by year's end. The two facilities will add around 100,000 vehicles to the country's export totals, which Solis said should leave the industry on the verge of breaking another export record in 2016. But how sustainable will these record-breaking years be? Slapping an "Hecho en Mexico" sticker on a new German SUV won't be enough to change the fact that Mexico's product mix is tilted too heavily towards body styles that are not growing in volume. Mexico's record-breaking export years probably aren't at an end, but we'd argue they're certainly under threat. News Source: Automotive News - sub. req.Image Credit: Omar Torres / AFP / Getty Images Plants/Manufacturing Ford GMC Honda Mazda RAM Volkswagen Truck Crossover SUV Mexico

Porsche-Piech buy 10% stake in VW's holding company

In August, 2009, as the scuttled merger of Porsche and Volkswagen had gone bad and Porsche was backed up against the ropes, Porsche Automobil Holding SE (PAHSE) relinquished a ten-percent stake in itself to Qatar Holdings as well as options it held on 17 percent of VW shares. The sale meant that, for the first time since the founding of the company 61 years before, an entity outside the Porsche and Piech families had a say in the running of PAHSE.
Buying that ten-percent stake back returns full ownership to the two families, the holding company's sole possession being ownership of 50.7 percent of VW's common shares. The price paid wasn't disclosed, but at market rates the purchase would be worth close to $1.25 billion. Qatar intends to hold onto the 17-percent stake it has in Volkswagen.

VW recalling 38k Jettas, Passats, Golfs and Beetles for fuel leak

Earlier we reported on a recall issued for the 2015 VW Jetta regarding a problem with the headlights, and now Volkswagen and the National Highway Traffic Safety Administration have issued another recall for a separate issue affecting not only the Jetta, but several other models as well. The issue revolves around a sealing cap in the fuel rail, which could leak fuel into the engine compartment and potentially cause a fire. The problem affects an estimated 37,979 vehicles in the United States, including the 2014-15 Jetta (manufactured between March 28 and November 24, 2014), the 2014-15 Passat (April 7 to November 18), the 2015 Golf and GTI (July 1 to November 20) and the 2014-15 Beetle and Beetle Convertible (March 31 to November 27). That covers pretty much the entire range offered by Volkswagen of America, short of the Tiguan and Touareg crossovers (and the discontinued Eos convertible). Considering, though, that VW routinely sells around 30,000 vehicles in the US each month, the small number of vehicles being recalled (relative to the quantity out there) tells you this recall really only affects a specific cross-section of models. Owners of the affected vehicles can expect to be contacted by their dealers to have the fuel rails replaced. RECALL Subject : Fuel Leaking Into Engine Compartment Report Receipt Date: DEC 22, 2014 NHTSA Campaign Number: 14V809000 Component(s): FUEL SYSTEM, GASOLINE Potential Number of Units Affected: 37,979 Manufacturer: Volkswagen Group of America, Inc. SUMMARY: Volkswagen Group of America, Inc. (Volkswagen) is recalling certain model year 2014-2015 Jetta vehicles manufactured March 28, 2014, to November 24, 2014, certain 2014-2015 Passat vehicles manufactured April 7, 2014, to November 18, 2014, certain 2015 Golf and GTI vehicles manufactured July 1, 2014, to November 20, 2014, and certain 2014-2015 Beetle and Beetle Convertible vehicles manufactured March 31, 2014, to November 27, 2014. A sealing cap at the fuel rail may fail, allowing fuel to leak into the engine compartment. CONSEQUENCE: A fuel leak, in the presence of an ignition source, can result in a vehicle fire. REMEDY: Volkswagen will notify owners, and dealers will replace the fuel rails with new parts, free of charge. The manufacturer has not yet provided a notification schedule. Owners may contact Volkswagen customer service at 1-800-822-8987. Volkswagen's number for this recall is 24Bi.