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Back Seat Driver: Tough times for auto industry

No doubt about it, these are very tough times for the auto industry.

Especially the domestics.

Take General Motors which today announced a loss of $722 million for the fourth quarter – but that was peanuts compared to the $39 billion loss it reported in the third quarter for unused tax credits. It also announced a buyout program to all its 74,000 workers.

For the year, the company reported a loss of $38.7 billion and does not see making any serious money until 2010.

Meanwhile, newly private Chrysler is in the midst of a massive restructuring that includes buying out workers, consolidating its dealerships and cutting the number of its models.

Ford is also buying out workers and consolidating the number of its dealerships as well as negotiating the sale of its Jaguar and Land Rover brands to Tata Motors of India. And it is reported to be interested in selling its Volvo brand.

All this against a backdrop of January sales that stunk – 15.8 million vehicles versus 16.3 million last January. Indeed, out of the six largest auto makers, only GM had higher sales (up 2.6 percent), according to Automotive News.

All the rest were down; Chrysler -12.1 percent, Ford -3.9 percent, Honda -2.3 percent, Nissan -7.3 percent and Toyota – 2.3 percent.

Automakers are hoping the recent cuts in interest rates and the tax rebates from the economic stimulus package will come to the rescue. Let’s hope they do.

- Peter C. T. Elsworth

Posted by Peter C. T. Elsworth  at 6:05 PM to Auto industry | Permalink | Comments 0

High-Tech Invitations Take Your Mind Off Road

Motorists have always engaged in risky behavior, whether it is eating a sandwich, arguing with a spouse, applying makeup or studying a map while speeding down the interstate.

But safety experts say the influx of electronics is turning cars into sometimes chaotic — and distracting — moving family rooms, according to The New York Times.

Talking on cellphones and typing text messages while driving has already led to bans in many states. But now auto companies, likening their latest models to living rooms on the road, are turning cars into cocoons of communication systems and high-tech entertainment.

Posted by Peter C. T. Elsworth  at 2:58 PM to Safety | Permalink | Comments 0

Thieves targeting catalytic converters in Rhode Island

Catalytic converter thefts, once unheard of, are happening with regularity across Rhode Island, and the nation, according to The Providence Journal.

Platinum and other precious metals coat the composite materials inside catalytic converters, which make gases such as carbon monoxide and nitrogen oxide less harmful. The devices are a required exhaust-system component for the majority of SUVs, trucks and automobiles on the road.

With metal prices spiking this winter, some scrap yards will buy a converter for as much as $150. And victims can pay as much as $1,000 in parts and labor to replace the device.

Posted by Peter C. T. Elsworth  at 1:25 PM to crime | Permalink | Comments 0

Gas prices in Rhode Island on the decline

For the first time since November, the average price of gasoline in Rhode Island has dipped below $3 a gallon. But the reprieve may be temporary with oil prices rising the past few days and the annual spring run-up just around the corner, according to The Providence Journal.

The average price of regular, self-serve gasoline was $2.999 a gallon yesterday, down 4 cents from last week, according to a survey of local dealers by the state’s Office of Energy Resources.

The average price has fallen 16 cents from its most recent peak of $3.159 a gallon on Jan. 7.

Home-heating oil rose 2 cents a gallon to $3.329 a gallon, according to the Office of Energy Resources, 10 cents below the all-time high of $3.429 a gallon, also on Jan. 7.

Posted by Peter C. T. Elsworth  at 9:58 AM to Gas prices | Permalink | Comments 0