BMW Wants To Keep The Kids, VW Hits On Models, And Dodge Dart Is Ready For Some Baseball
This is the Morning Shift, our one-stop daily roundup of all the auto news that's actually important — all in one place at 9:00 AM. Or, you could spend all day waiting for other sites to parcel it out to you one story at a time. Isn't your time more important?
1st Gear: Which Car Companies Are In The Money?
Fortune Magazine is out with its annual Global 500 list, and you'll see a lot of familiar names there. Toyota ranks No. 10, Volkswagen comes in at No. 12, and General Motors, which led the list for years, stands at No. 19. The overall rankings are based on a company's revenue and profits for fiscal years that ended on or before March 31. Further on down the list, you'll find Daimler at No. 21, Ford at No. 27, and then there isn't another car company until Nissan at No. 42. If you just look at profitability, things shake out a little differently. Volkswagen ranks No. 13, Ford is No. 14 and GM joins the list at No. 48. (Toyota does not show up in the top 50.)
This year's list says a lot about VW and its drive to lead the auto industry. It is doing so by increasing revenue and profits (the top line and bottom line we talked about the other day), where Toyota's overall ranking is based essentially on revenues, which is also why GM landed as high as it did on that list. For instance, Toyota outsold VW by $14 billion, but VW's profits were seven times greater. GM's profits were three times greater than Toyota, but Toyota outsold GM last year by $85 billion. Play around with the tabs on the Fortune 500 chart and see what kind of analyses you can come up with, and share it with us.
2nd Gear: Volkswagen Gets Cosy With The Models
Meanwhile, Fortune weighs in with a classic Alex Taylor story on Volkswagen and its attempt to take over the automotive world, which means that we'll be seeing the 60 Minutes version in around 2014. Deep in the story, after all the obligatory background, there's a good explanation of VW's modular approach to car development. It's already done it with bigger vehicles, and now it's working on something called the modular transverse matrix, or MQB (modularer Querbaukasten in German), that will be used in more than 40 small cars. The goal is to standardize the parts representing 60 percent of a car's cost. VW plans to use this on 7 million units per year. If it's successful, VW figures it will cut product development costs by 20 percent, parts costs by another 20 percent, and production time by 30 percent. Add it all up and the analysts at Société Générale believe the annual savings could reach $3 billion, or about $500 per car.
Okay, call us cynical, but we've been watching car companies all over the world do this for years now — how many times has Ford told us they've cut the number of steering wheels from 18 to seven? Standardization only works when consumers have absolutely no idea that a car company is doing it. The proof will be whether VW can come up with vehicles to meet the needs of buyers in its different markets, but not tinker so much with MQB that it becomes just another acronym on the pile.
3rd Gear: BMW ActiveHybrid 3 = 5 Detroit Houses
Car and Driver says BMW has set the price of the 2013 ActiveHybrid 3, its smallest hybrid, at $50,195, or a little more than the average sale price of five houses in Detroit. The ActiveHybrid 3 is based on the 3-series, of course, and it will have the same turbo-charged, 3.0-liter, inline six and electric motor combination that's on the ActiveHybrid 5. Fuel economy numbers aren't available yet, but BMW is promising that you'll be able to go 2.5 miles on the car's fully charged electric battery pack if you stay under 45 mph. For some owners, that will let them get down the driveway. BMW is claiming a total system output of 335 hp and a zero-to-60 time of 5.3 seconds.
4th Gear: BMW Wants To Stay Electrified
And speaking of BMW, Bloomberg reports on the other big divorce in the news: BMW and Peugeot. It says BMW wants to hang on to BMW Peugeot Citroen Electrification, the joint venture that was established in October to develop, purchase and produce electric powertrains and components. The venture has an R&D center in Munich and a production site in Mulhouse, France, where 250 workers were supposed to be employed to electrify about 10,000 vehicles starting in 2015. A BMW spokeswoman says she doesn't know whether the JV's employees would move to BMW. Of course, the breakup was caused by Peugeot's joint venture with Opel, which caused BMW to go running to Toyota. (Tom and Katie, you be the judge.) We'll see which of the new marriages works out better.
5th Gear: What Are Tom Brady, Kanye, Jay-Z And Frank Ocean Doing In The Dodge Dart?
The Detroit Free Press reports on the first ad for the new version of the Dodge Dart, which Chrysler is scheduled to show tonight during the MLB All-Star game. Tom Brady, the former Michigan football star turned New England Patriots' star turned Giselle's husband, makes a cameo appearance during 90 seconds of fast-talking, fast-moving images. The ad's soundtrack is the Jay-Z/Kanye West song, "No Church In The Wild" which was written and co-performed by Frank Ocean, the singer/songwriter and car buff who came out on his Tumblr last week. His revelation caught a lot of people in the music industry by surprise, so it will be interesting to see if Chrysler embraces his supporting role in launching the Dart. (They might appreciate him more if Ocean says something about the Dart and not just the Bentley SUV atop his page...)
6th Gear: How To Keep From Killing Your Travel Companions
Travel Dudes offers a list that anyone who goes on a road trip will benefit from. It's advice for getting along when you're stuck today for days, weeks or God help you, longer, and it's pretty candid. Of course, pick your companions carefully, but understand that you will ultimately have arguments. Don't hold in what's bugging you, Travel Dudes recommends, but use constructive criticism rather than stomping off in anger and never speaking to your friends again after the trip. Or worse, tearing off in your road trip car and stranding them.
One really helpful tip is to give yourselves breaks from each other, something I wholeheartedly endorse. If you just spend 24 hours apart, you come back to dinner calmer, with new stories, and you're ready to hear how your friends got along while you weren't getting on each others' nerves. Another tip is to eat, drink and sleep properly (and do all three, not just one or two). Above all, don't lose track of the reason you took the trip in the first place. You don't want a fight in Memphis to spoil the rest of the drive to New Orleans.
Reverse:
Ford, GM Post Record June Sales in China [Detroit Free Press]
Toyota Ditches Its Washington Lobbying Firm [Legal Times]
Mark Webber Signs New Red Bull Deal [ESPNF1]
Mazda's North American Marketing Boss Quits [Automotive News (sub. required)]
2013 Lexus LS Will Be Revealed During Web Cast On July 30 [Lexus]
Why American Cities Don't Have Driverless Trains [Atlantic Cities]
Neutral
In keeping with our new discussion system, here's a place for you to own the floor. We're asking each day what you think about an issue that comes up in TMS.
Today, let's hear about the Dodge Dart. It was my first car (a very used rust-colored and rusty 1973 with a slant six) so I've got an interest in seeing how this one does. Is Chrysler headed down the right path, or will Dart take it off in the wrong direction? What's your sense, in general, of bringing back old car names? And, what do you think of this ad? Remember there's no right answer, or wrong answer. It's Neutral.
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