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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.

Volkswagen recalls 20k Routans to replace ignition switch

Volkswagen is recalling 20,676 examples of the 2009-2010 Routan minivan to replace their key fobs and ignition switches. This new campaign is linked to one from FCA in March. In these vehicles, it's possible that if the switch is jarred, the key can be jostled out of the Run position. If this happens, then the engine shuts off, and the airbags, power steering and power brakes are all deactivated, which is a safety problem. The campaign to fix this issue began last year when FCA recalled 700,000 minivans, and the Routan was also affected because of its shared platform. However, in March 2015 FCA updated its recall to replace the whole ignition switch with an improved design, rather than the original plan of just a new detent ring. With this latest update, the VWs are getting the same fix. Until the minivans are repaired, VW says that drivers should remove all items from their key ring, including the fob. The recall is expected to begin in April for owners of the 2009 Routan and in August for the 2010 models, according to documents submitted to the National Highway Traffic Safety Administration (available here as a PDF). Some vehicles already have a new detent ring under the earlier recall, but they still need to be fixed again to get the ignition switch. Related Video: RECALL Subject : Ignition Switch may Turn Off Report Receipt Date: APR 01, 2015 NHTSA Campaign Number: 15V194000 Component(s): ELECTRICAL SYSTEM Potential Number of Units Affected: 20,676 All Products Associated with this Recall Vehicle Make Model Model Year(s) VOLKSWAGEN ROUTAN 2009-2010 Details Manufacturer: Volkswagen Group of America, Inc. SUMMARY: Volkswagen Group of America, Inc. (Volkswagen) is recalling certain model year 2009 Routan vehicles manufactured June 25, 2008, to June 10, 2009, and 2010 Routan vehicles manufactured October 1, 2009, to August 11, 2010. This defect can affect the safe operation of the airbag system. Until this recall is performed, customers should remove all items from their key rings, leaving only the ignition key. The key fob (if applicable), should also be removed from the key ring. Road conditions or some other jarring event may cause the ignition switch to move out of the run position, turning off the engine. CONSEQUENCE: If the ignition key inadvertently moves into the OFF or ACCESSORY position, the engine will turn off, which will then depower various key safety systems including, but not limited to, air bags, power steering, and power braking.

Happy 60th to the VW Karmann Ghia

Volkswagen's product portfolio may be as extensive these days as any other carmaker in the business. But if you still think of the original Beetle as synonymous with the brand, that's probably because a) you're old and b) the Beetle was the company's only product until the mid-50s.
Sixty years ago Wilhelm Karmann (founder of the eponymous coachbuilder) was in Paris for the auto salon and met up with Luigi Segre and his team from Carrozzeria Ghia who showed him what was essentially a "Beetle in a sports coat." A month later they showed it to Volkswagen chief Heinrich Nordhoff who, setting aside his conservative tastes, approved it for production. And so the Volkswagen Karmann Ghia was born, giving the German marque a second product line. It still used Beetle mechanicals and was built at the same Karmann factory in Onsabrück that was already assembling the Beetle Cabriolet.
It took another couple of years to put the design into production, but from 1955 to 1974, Volkswagen and Karmann built 362,601 coupes and 80,881 of the subsequent convertible that arrived in 1957. Today the Onsabrück factory is part of the VW Group, handling production of the Golf Cabriolet, XL1 and Porsche Boxster and Cayman, and with that original Karmann Ghia prototype as part of its factory collection.