Reuters blog archive

from Expert Zone:

First Drive: Mercedes-Benz GLA

(Any opinions expressed here are those of the author and not of Thomson Reuters)

The trend of luxury crossovers was started by BMW with the X1. Audi followed suit with its Q3 and Mercedes-Benz is now entering the game with the GLA.

On sheer looks, Mercedes-Benz seems to have got it right with the GLA. It’s a great effort of making the A-Class hatchback look like a crossover. Though they may not have managed to pull off a crossover per se, the GLA definitely looks well proportioned and flaunts pronounced curves. It even looks slightly muscular from some angles. It’s a bit odd, as the GLA - to the keen eye - will look more proportionate and attractive in comparison to the A-Class. The A-Class now comes across as the GLA that the Hulk sat on.

The resemblance to the A-Class isn’t limited to surface design and overall appearance; the GLA looks similar on the inside too. There’s oddity around - like the tab-type screen hooked on in the middle of the dashboard - but it sort of looks fine. Mercedes is being aggressive globally in their strategy, and that’s odd too. But it’s working, no?

The space in the cabin is also very hatch-like, which means it’s not much - especially at the rear. Particularly so if you’re tall. The business end, conversely, is supportive and finding the right driving position isn’t an issue. The quality inside is also typically Merc - properly blue-chip.

from The Great Debate UK:

Financing must improve if UK auto sector is to thrive

--Guy Walsh is Regional Director at ABN AMRO Commercial Finance PLC. The opinion expressed are his own.--

The automotive industry is the UK’s largest sector in terms of exports, generating around £30 billion of annual revenue, but many smaller players in the sector languish due to a lack of funding.

from Data Dive:

Auto industry looks up

Car companies are taking advantage of low interest rates and expanding their finance arms -- so much so that they are nudging out the big banks, Reuters reported this week. Automakers made half of new car loans last quarter, up 37 percent from a year earlier. According to Reuters:

The automakers are in a position to offer the deals because their cost of borrowing has gone down as their balance sheets have improved and as bond investors have lined up to buy securities backed by loans and leases.

from Counterparties:

MORNING BID – Spending concerns and car sales

Coming data on same-store sales will help illuminate whether the modest upward tick in prices is something that is being replicated throughout the economy and signalling a stronger overall economy or perhaps one that remains more weighted to the most wealthy in the United States. According to Thomson Reuters data, Costco is poised to post the strongest same-store sales figures among the retail chains, though its 4.6 percent estimated increase would fall short of the 5 percent rise a year ago. The figures have a bit less utility than in the past given the likes of Wal-Mart stopped supplying this data years ago, but you work with what you have. Either way, it's notable that the discounters have been weak this year - a sign of lackluster spending outlooks for lower income Americans.

The lower-income sector has seen its share of economic growth diminish over recent years, a trend that has been accelerated in part by the weakness in housing prices in most parts of the economy, poor overall demand and lack of spending among all but the upper tier of consumers, and no real growth in wages -- though this morning's data on productivity and labor costs does show finally some wage growth.

from Breakingviews:

Ford schools U.S. firms on turnarounds, succession

By Antony Currie and Kevin Allison
The authors are Reuters Breakingviews columnists. The opinions expressed are their own.

The end of Alan Mulally’s reign at Ford is corporate America’s opportunity to learn. In almost eight years as chief executive, the former Boeing executive not only engineered a textbook case in how to drive a company out of the scrap yard. He, along with Executive Chairman Bill Ford and the rest of the board, also did an enviable job of paving the way for his successor.

from Breakingviews:

GM can find small comfort in Toyota’s ride

By Kevin Allison
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

General Motors can find some small comfort in Toyota’s recall ride. Before Chief Executive Mary Barra was hauled up to Capitol Hill on Tuesday, the U.S. automaker summoned more vehicles back into the shop and doubled the estimated cost of fixing safety issues in the first quarter. Toyota’s expensive accelerator fiasco suggests GM’s costs will probably rise from here, but ultimately the financial fallout should be manageable. Culture may be the harder repair.

from India Insight:

Organised players, growing acceptance boost India’s used car market

One would expect the former head of India’s No. 1 car maker to drive a glitzy new SUV or an imported luxury car, but Jagdish Khattar thinks differently. The industry veteran who spent 14 years at Maruti Suzuki now buys only second-hand cars and drives a used Volkswagen Passat.

"Rich people buy new cars, intelligent people buy second-hand cars," said Khattar, the founder of Carnation Auto, a service and used-cars company he started in 2008 after leaving Maruti. The used car market, he said, is the future of automobiles.

from Breakingviews:

GM’s dividend hits right spot on multiple levels

By Antony Currie

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

General Motors is hitting the right spot on several levels with its return to paying a common stock dividend. The $1.7 billion annual payout looks punchy at some 30 percent of what analysts reckon the company’s net income will be for 2013. Ford Motor, after all, restarted its shareholder payouts at a more cautious 10 percent of profit just over two years ago and only last week took it up to around a third. But GM looks positioned to handle it.

from Breakingviews:

Chrysler deal gives Fiat a new year’s turbo boost

By Antony Currie
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Sergio Marchionne could not have wished for a better start to 2014. On the first day of the new year, the boss of both Fiat and Chrysler managed to strike a deal allowing the Italian firm to become the sole owner of Detroit’s third-largest automaker. And the $4.3 billion two-part pact he has made with Chrysler’s union trust fund puts him on top.

from Breakingviews:

GM navigates smart route to CEO succession

By Antony Currie
The author is a Reuters Breakingviews columnist. The opinions expressed are his own.


General Motors has navigated a smart route to succession. Dan Akerson, who has run the company since mid-2010, is stepping down in January. Replacing him as chief executive is Mary Barra, who despite 33 years of service at the automaker, has mostly sidestepped the taint of pre-bankruptcy failures. GM, freshly liberated from the U.S. government on Tuesday, also appointed an independent chairman for good governance measure.