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Auto Alliance Talks Suspend Over Premium to GM

CEO reportedly still open to alternate North American Alliance

A dispute over the terms Nissan-Renault posed to GM has lend to the end of talks between the three companies. Carlos Ghosn, chief executive of both corporations, said before the talks ended that he’d still consder working with another North American company if talks didn’t work out.

Speculative reports point at Ford Motor Company, as they have recently posed the notion to pursue talks with Nissan-Renault.

From an article in the LA Times:

"Assuming he was sincere, Ford looks like the next candidate for the job," Banc of America Securities analyst Ron Tadross wrote in a note to investors Wednesday.

Read more in the International Herald Times.

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Gas Prices Can�t Stop Bigger and Better SUV Manufacturing

Ford�s Ignores Consumer Cut-Backs With Expedition EL Model

Gas prices have caused a considerable decline in the purchasing of SUV and other gas-guzzling car models but apparently not expedition elenough to make some auto makers resist exploring new large and luxurious territory. Ford is releasing a version of the Expedition called the Expedition EL in 2007 to test the ground for large vehicle purchasing. At the same time Ford is releasing the emissions-reducing PZEV Focus in consideration of environmental and energy issues at the forefront of the public’s concern, it is attempting a big, very big new SUV.

The pursuit of the SUV market still clinging to their transportation treasures is an example of just how popular SUVs were a decade ago. For a company like Ford to continue manufacturing full-sized SUVs that are by no means cost efficient and energy saving and expect a level of profitability says that SUVs are still hot to trot despite a market drop off. Interested in the Ford Expedition EL and other 2007 SUV models like it? Whew, you’d better be just as interested in warranty coverage for your new toy. You don’t want to neglect an extended warranty to extend your Expedition EL’s very pricy future.

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Flex-Fuel Popularity Grows

The ‘new’ technology picks up speed heading into 2007

With the world turning the way it is presently, there are plenty of reasons traditional gasoline-powered vehicles are coming under scrutiny. There’s the crude oil situation, skyrocketing transportation prices across the globe. Let us not forget the EPA who constantly reminds us how much damage our emissions are doing to the atmosphere lest we forget to look outside our own window. What’s a country to do?

Two types of fuel, one tankFlex-fuel technology was originally created by the Ford Motor Company two decades ago. Since that time, there has been a very slow increase in awareness in this new breed of automobile known alternatively as variable fueled vehicle.

The concept is an interesting one. Instead of running entirely on a different type of fuel, the flex-fuel model allows engines to be powered by any mixture of petroleum and ethanol. That means fill up with ethanol when you can–it’s better for the environment, and you’re doing your part to deter the high prices of unleaded fuel. But when you can’t find a refill station for the corn by-product, it’s ok to fill up with the usual 89-octane. The vehicle requires nothing more from you. It has sensors to monitor the mixture and adjust fuel injection and timing to keep the engine spinning smoothly.

How about efficiency and price? Running purely on ethanol, any of the 31 models for 2007 will average four to five miles per gallon less around town and on the highway than if running strictly unleaded gasoline. Due to the sporadic demand of ethanol, the prices fluctuate widely based on demand. Currently, only nine states in the U.S. have more than 20 ethanol refilling stations statewide.

General Motors leads the way into 2007 by offering six flex-fuel vehicles. Daimler-Chrysler also shows promise by offering four. Most of the variable fuelers available are large trucks or SUVs, and that trend will continue.

One is forced to wonder if this technology is going to make it in the mainstream. With electric vehicle and fuel cell technologies progressing, flex-fuel is not the only solution to a market thirsting for answers.

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Ford looking for a saving strategy

The Detroit automaker is suffering heavy losses

It’s no secret that some of the largest automobile makers in North America are feeling the pressure from their Japanese rivals. As companies like Ford and General Motors watch their market share dwindle, one would think that an offensive strategy would be in the works. Ford, though, seems more confused than competitive at the moment.

After suffering losses of over $1.5 billion in 2005 and more than $1 billion already this year, CEO Bill Ford seems caught between making excuses and trying to create a plan to save the company. He told the New York Times earlier this year,

"The headwinds we faced at the beginning of 2006 have only become stronger."

Ford has also announced its current restructuring plan, the second in less than five years, which seems vague and lacking direction. Thirty thousand jobs being nixed by way of fourteen plant closures ought to give way to some profitability by 2008. But what about specific cost-cutting targets, or clearly-defined sales goals, or even market-share growth plans? Those don’t exist just yet.

Then there’s the compact car market, where Toyota, Honda, and Nissan have made very attractive advancements. Ford has all but forgotten about its own Focus, which will receive only small changes for the upcoming year.

Although the Ford F-150 has been America’s best-selling vehicle for all of recent history, the pressure is on from newly-designed competitors like Chevy, GMC, and Toyota with their Silverado, Sierra, and Tundra, respectively. Contrary to Ford’s closing of factory plants, Toyota plants to skyrocket sales of its Tundra with its newly-opened plant in Texas.

And who can forget fuel-efficiency? The highly-efficient Ranger has been neglected for the upcoming year as well. Ford has also backed off of its goal for the number of hybrids it plans to bring to the market in the next four years. With gas prices predicted to continue rising, and with an increasingly fuel-economy-minded consumer base, these decisions don’t seem to be in the interest of increasing sales.

But there is a sparkle of sunlight on the horizon, and it’s the Edge. It is Ford’s impressive new entry into the crossover market. With attractive lines, sporty 18-inch alloys by default, and a class-leading standard six-speed automatic tranny, the Edge shows a lot of promise.

Ford may be down, but they’re far from out. However, if they expect the tides to turn any time soon, they need a little more than one hot new Edge and extended factory warranties across the board to draw the consumers back their way.

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Detroit automakers feel pain of gas prices

Ford, GM, and Chrysler are stuck with SUVs

Gas prices drain revenueOh, if only they had looked ahead.

Half a decade ago, the sport-utility craze was in full force. The three large automakers based in Detroit were reeling with delight, while their strategists were planning ahead for new and better SUVs and heavy-duty pickup trucks.

With Japanese automakers having spent the last few years focusing on more fuel-efficient vehicles and developing hybrid technologies, the US companies are feeling the disadvantage. Gas prices have nearly tripled in a few short years, and truck- and SUV-focused companies such as Chrysler are at a loss, literally. Chrysler reported earnings of less than $70 million for the last quarter, and they project losses in the hundreds of millions in the near future.

One might reason that the American companies should follow suit and begin producing smaller, more fuel-efficient vehicles. However, in order to stay competitive with the smaller cars, their profit margins will remain around one-tenth of the green gap with the larger trucks and SUVs. For that reason, it still doesn’t make sense financially to refocus their efforts.

While great fuel economy is simply not feasible at this point in the realm of large automobiles, the executives at the companies such as General Motors can find solace in the newer models of their vehicles being more fuel-efficient than previous models. It appears that they will hold their path, cross their fingers, and hope that consumers still have a place in their hearts for gas-guzzling beasts.

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Ford extends powertrain warranties

All 2007 models will receive new warranty program

Ford MustangFord Motor Company is increasing its powertrain warranty on 2007 models. The Ford, Lincoln, and Mercury brands will be affected by this upgrade.

The Ford and Mercury brands will get an increase from a three-year, 36,000-mile warranty (which remains the bumper-to-bumper coverage) to five-year, 60,000-mile powertrain coverage. There will also be complimentary roadside assistance for the life of the warranty.

The Lincoln brand gets an even larger boost, with the new powertrain limited warranty being extended to six years or 70,000 miles. Its four-year, 50,000-mile bumper-to-bumper coverage remains unchanged. Roadside assistance on all Lincoln models is also covered for the life of the powertrain warranty.

Ford Motor Company has increased these offers based on high demand from dealers. These new offers will help to quell quality concerns and increase the consumers’ perceived quality of the brand.

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Ford’s Riding The Hybrid Wave

Ford is investing in hybrid tech, now that’s a suprise

Ford Plans to invest $1 Billion into hybrid technology. Since Ford has abandoned their promise to have 250,000 hybrids by 2010, they’re now trying to show they still care about hybrids.

Ford plans to build a center for developing new fuel efficient or hybrid cars in Gotenborg, which happens to be where Volvo, it subsidiary company, is located.

The center will produce new hybrid technology for all of Ford’s brands in Europe, and for Volvo models worldwide, the companies said.

The plant will be run by Volvo but will provide Ford with the new technology too. To be exact about the investment, Ford plans to spend 1.36 billion to supplement technological changes that will occur.

This is a good move of Ford’s part. Though it may be a bit late, it’s better to be late than never to do it at all. To ride the hybrid wave, Ford is going to have to really get into gear and do things right the first time; one more mistake of Ford’s part could spell disaster.

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Midsized SUVs to get the Boot

Ford and GM look to crossover vehicles

Detroit’s automakers, Ford and GM, will be cutting back their midsized SUV’s, and in some cases, popular mid-sized SUVs will be cancelled completely. In fact, the infamous Trailblazer will be axed by 2010. In 2009 GM was going to give the trailblazer a remake, however, it seems it will instead be cancelled.

The moves come as sales of mid-sized SUVs slump. U.S. sales of the Trailblazer and Envoy peaked at a combined 418,381 units in 2004. That dropped to 352,012 units last year.

When the trailblazer is killed off, GM will begin implementing crossover vehicles that will be more economical for larger families to buy.  Most of the cross over vehicles are still in concept design, so it will be a year or two before we see any of them.

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Hybrid News From Ford

Ford changes promise

A few months back, Bill Ford promised that his company, Ford Motor co., would produce 250,000 hybrids by 2010. However, now it seems that Ford is rearranging their promise.

Ford is now not promising any number of hybrids at all. Ford has changed their focus. Now, they’re promising  2 million alternative fuel vehicles by 2010. So, instead of completely catching the hybrid fever, they’ll just be producing more cars that use E85 and other bio fuels. 

Ford stated in the email that the Blue Oval will focus more on other fuels like ethanol, clean-diesel and bio-diesel. In conjunction Ford is announcing a partnership with VeraSun Energy today to create an "ethanol corridor" with 50 new E85 pumps between Kansas City and Chicago.

Ford does still plan to produces a hybrid Mazda Tribute, a hybrid Ford Fusion, and a Hybrid Mercury Milan in 2008.  

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Auto Industry’s Innovation

Ford tries something new

Everyone knows that the auto industry is not exactly a bed of roses right now.  Thus, companies are pulling out all the stops when it comes to innovation and new ideas. While in last place, Ford is trying the most "innovative" approach, Boldmoves is a documentary style website that’s "behind the scenes" style deep within the ranks of Ford. The website is a nifty advertising scheme that, in theory, could get people interested in Ford’s business model.

I’m sure, however, that the documentary style is not so documentary. Usually in unscripted an documentary you end up with things like "The Office" in real life, and I’m sure Ford will not allow others to see the nuts and bolts of the company like we would wish. To an extent, I’m sure the "documentary" is fairly scripted. But, who knows, it’s new; maybe boldmoves will prosper and become a interesting piece of work.

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