Love is all around in Toyota-Tesla deal
The stunning romance between global auto giant Toyota Motor Corp and Silicon Valley startup Tesla Motors began like a Hollywood tale – with a date in a fast car.
“I received a call that Mr. Toyoda was interested in meeting with me the next time he was in California, and I said that sounded great,” Elon Musk, chief executive of Tesla said.
The two men hit it off when they met in Musk’s home in Southern California about six weeks ago and went for a drive in the pricey electric Roadster sport car.
“We just drove around Los Angeles, mostly around Westwood initially,” Musk said. “We were mostly talking about random things.”
Toyoda, a car enthusiast and active amateur racer, took the wheel and put the sports car “through its paces,” Musk said. “He was not shy.”
The ride in the Roadster, which can accelerate faster than a Ferrari, effectively sealed the deal for the partnership and the two hashed out a plan to solidify their mutual admiration.
“I love cars… their cars are just magnificent,” Toyoda said of the Roadster in an interview with Reuters.
from Shop Talk:
Check Out Line: Duke wins, but there’s another bracket to fill
Check out a different kind of tournament bracket still underway.
The Duke Blue Devils may have won yet another college basketball title Monday night, but consumers can still make their "Sweet 16" picks in Consumerist.com's annual "Worst Company in America" tournament, which runs through April 26.
In its fifth year, the website, owned by Consumers Union, the publisher of Consumer Reports, lets consumers vote for their least favorite companies in matchups much like the NCAA tournament. Starting with 32 "teams," the tournament pairs companies in votes in which the "winner" (think about it, in a worst company vote you want to lose) advances to face the next competitor.
In the first round this year, Bank of America beat Citibank, GM beat Toyota and in an "upset" Cash4Gold beat defending "champion" AIG. Other companies that advanced included Walmart, Ticketmaster, United Airlines, Best Buy, Apple and Comcast, which has lost in the title game the last two years.
In addition to AIG, past winners have included Halliburton, Recording Industry Association of America and Countrywide. In last year's final, AIG whipped Comcast 3,528 to 1,968 as voters took their frustration over the recession out on a company that was bailed out by the U.S. government.
"They were just constantly in the headlines," Consumerist.com co-managing editor Ben Popken said of AIG. "They became a real focal point for what went wrong with the economy."
Consumers nominate companies to compete in the annual tournament, which was created as a tongue-in-cheek way for shoppers to "bite back" using social media and the Internet, according to Consumerist.com. To be considered for inclusion the website now requires that companies must regularly provide products or services to consumers.
from Russell Boyce:
The politics of bowing in Japan – How low do you go?
By Michael Caronna, Chief Photographer Japan
In Japan nothing says I'm sorry like a nice, deep bow, and lately there's been a whole lot to be sorry for. Ideally the depth of the bow should match the level of regret, allowing observers to make judgements about how sincere the apology really is. Facing massive recalls Toyota President Akio Toyoda and Toyota Motor Corp's managing director Yuji Yokoyama faced journalists at separate news conferences.
Toyota Motor Corp's managing director Yuji Yokoyama (R) bows after submitting a document of a recall to an official of the Transport Ministry Ryuji Masuno (2nd R) at the Transport Ministry in Tokyo February 9, 2010. Toyota Motor Corp is recalling nearly half a million of its flagship Prius and other hybrid cars for braking problems, a third major recall since September and a further blow to the reputation of the world's largest automaker. REUTERS/Toru Hanai
Toyota Motor Corp President Akio Toyoda bows at the start of a news conference in Nagoya, central Japan February 5, 2010. Toyota Motor Corp President Toyoda apologised on Friday for a massive global recall that has tarnished the reputation of the world's largest car maker. REUTERS/Kim Kyung-Hoon
Battered car-makers rounding blind corner
(Update: This piece was written, as several commenters have pointed out, before GM clinched a sale of Saab to Spyker on January 26.)
By Quentin Carruthers
(Acquisitions Monthly) Automakers face a demand slump in Europe and the longer-term challenge of addressing climate change. Both pressures are expected to lead to further restructuring, consolidation and M&A activity.
The North American International Auto Show, held each January in Detroit, Michigan, is just coming to an end. Detroit is the hometown of America’s “Big Three” automobile makers – Ford, General Motors, and Chrysler – and the show constitutes one of the most important events in the industry’s calendar.
Touring the floor with a group of her fellow Congressmen was Nancy Pelosi, Speaker of the House of Representatives, who told reporters: “We came to listen, to learn, to observe, to measure, to judge what has happened to the investment that we made.”
US state investment includes US$60bn of government loans to support automotive assemblers, in return for control of GM and a minority stake in Chrysler, both of which came out of Chapter 11 bankruptcy proceedings in mid-2009. A further US$3.5bn has been used to support parts suppliers, and US$3bn to support car retailers.
Total state support equates to a loan of more than US$50,000 for each job in the manufacturing side of the industry, as calculated by Philip Wylie, director and automotives leader at restructuring adviser Houlihan Lokey.
Saab WILL survive. Spyker purchased Saab from GM last month…. come on guys GET WITH IT!!! Embarrassing.
Volvo’s Chinese journey
News that Ford expects to finalize the sale of Volvo to China’s Geely in the first half of 2010 caps a year that saw China overtake the United States as the world’s biggest auto market, something that would have been unthinkable only a few years ago. With Geely rival BAIC announcing its intention to harvest intellectual property from Saab, Chinese automakers are going into high gear in both their short-term goal of serving the high-octane domestic market and their longer-term ambition of retooling their manufacturing base to better serve the global automotive market.
Geely is China’s largest private automaker. Its charismatic founder, Li Shu Fu, is known as the Chinese Henry Ford. He has shown global ambitions and has pushed for Geely to become a global brand.
It’s a road well traveled, the highway from Asia’s industrial heartlands to the world’s garages. Japan and South Korea have blazed the trail thoroughly. Rather than ponder the significance for lumbering Western automakers who are shedding assets to stay alive, it’s worth wondering what Toyota and Hyundai make of their Chinese cousins.
from Commentaries:
Should Volkswagen demand a Magna Carta?
Magna International seems to be taking seriously threats from Volkswagen to pull its business following the Canadian car parts maker's Opel victory.
Magna's co-CEO Donald Walker is saying that after talking to them, most of his other customers are happy that the car parts group -- which along with Russian backer Sberbank is buying a 55 percent shareholding in GM's Opel -- is able to protect their technologies.
Apparently VW is still unconvinced, so Magna will "finalising the internal procedures" and will have more talks with the German carmaker.
Walker is also stressing that Magna is not looking to compete with its clients but is simply aiming to get a good return on its investment in Opel, reiterating that Magna will remain a parts company.
There seems little doubt that Magna can manage potential conflicts, after all it already builds cars for BMW, Chrysler and Mercedes as well as making parts for Toyota, Ford and VW.
But to say Magna won't be competing with other carmakers once it starts building Opel cars is stretching the point. Why else would you buy Opel if it wasn't to take market share from VW and others?
from Global Investing:
Sen. Corker to Chrysler: best hope is merger
Tennessee Sen. Bob Corker (right, in the driver's seat next to Mark Fields, Ford's president of the Americas), who pushed for tough conditions on the $17.4 billion U.S. government bailout for General Motors and Chrysler, said at the Detroit auto show that he hoped Chrysler would find a merger partner to survive.
"Chrysler probably needs to merge with somebody, not necessarily disappear from the standpoint of existence," said Corker, who added the automaker owned by Cerberus Capital Management was not making the needed investment to remain competitive. He spoke to reporters as he toured the show before meeting with executives for GM, Chrysler and Ford.
Corker, whose home state includes the U.S. headquarters for Japan's Nissan, also said he felt GM's debt load was too heavy and it may not meet the restructuring targets set out under the $13.4 billion loan granted to the company by the Bush administration.
The Republican senator met with GM Chief Operating Officer Fritz Henderson and, during his visit to the GM stand at the show, sat in the Cadillac Converj, a luxury model of the all-electric Chevrolet Volt concept car.
Corker said he loved the Jeep he drove before he came to Congress, though he did not specify which model. Chrysler, which received $4 billion in emergency loans, owns the Jeep brand.
The most contentious issue in the Bush administration's bailout plan is a goal that seeks to bring hourly wages for the U.S. automakers' unionized work force in line with those of Toyota and other Japanese automakers operating nonunion U.S. factories.
The labor give-back provisions were spearheaded by Corker and incorporated into the bailout. A proposal to strip the Corker-inspired labor provisions from the automaker rescue was included in legislation introduced in the House of Representatives last week.
With a pit crew like this…
As GM’s resident guru, Bob Lutz, was telling CNBC he was guardedly optimistic that a short-term loan will be made available to the auto industry, the global picture clouded considerably. The chief of Italian carmaker Fiat told a magazine the company was too small to survive alone, Sweden was reported mulling a rescue package for Volvo and Saab, and Toyota, the world’s biggest car maker, was said to be eyeing spending cuts of up to 40 percent. Fiat’s chief, Sergio Marchionne, went a little further, prognosticating that Chrysler will disappear and that only six big players will be left around the world when the dust settles. White House and congressional negotiators are working on an emergency rescue for the struggling industry, but passage of even a slimmed-down lifeline is far from certain. Sen. Richard Shelby, the top Republican on the Senate Banking Committee, has threatened a filibuster to block any bailout, according to Politico.com. The Senate is due back in session today. Shelby, an Alabama Republican who has spoken out against the proposed “bridge loan” emergency package, indicated he was ready for battle. “This is a bridge loan to nowhere,” said Shelby, appearing on “Fox News Sunday” with Sen. Carl Levin of Michigan, a Democrat. Senate Banking Committee Chairman Christopher Dodd, who is leading efforts to craft bailout legislation, told CBS that GM Chairman Rick Wagoner should resign. Levin, whose state is home to the major automakers, said he was confident there would be a deal but was less certain a filibuster could be avoided. Deals of the day: * San Miguel will buy a majority stake in Petron from the Ashmore Group for about 32.8 billion pesos ($675 million) after the British investment company completes a deal with the Philippine government, San Miguel’s president said. * U.S. energy producer Arch Coal expects production in 2009 to be flat or slightly lower while overall output for the U.S. coal industry will slow, and also sees plenty of opportunity for acquisitions amid the economic downturn. * Hedge Fund firm Centaurus is likely to sell its minority stake in French IT services group Atos Origin, but not in the immediate future, sources close to the matter said. * Belgian-Dutch financial services group Fortis has upped the selling price of its Belgian insurance unit, which French peer BNP Paribas agreed to buy, a Dutch newspaper said. * One potential investor has already cast its eye over Latvian bank Parex, which the state has had to rescue, an official at the country’s bank supervisory body was quoted on as saying. * Investment group Evolve Capital said it had offered 10.7625 pence a share to buy niche investment bank Blue Oar in a deal that would value the company at 17.9 million pounds ($26.3 million). * British mid-sized broking firms Ambrian Capital and Panmure Gordon & Co said they have held talks regarding a possible merger between the companies. * Qantas Airways warned investors its proposed $5.6 billion merger with British Airways faced major obstacles over the terms of the deal and stressed there was a reasonable chance talks would fail. * French healthcare diagnostics group BioMerieux said it had acquired privately held PML Microbiologicals, a U.S-based provider of culture media and microbiological products. * Peabody Energy, the most valuable U.S. coal miner, said it is eyeing potential investments in the western regions of China, the country that is expected to drive much of the global growth in demand for coal. * Swiss drugmaker Roche Holding is still committed to its $43.7 billion bid to buy out U.S. biotech group Genentech, its chief executive was quoted as saying in an interview. * Santos, Australia’s third-largest oil and gas firm, was considering potential initiatives but talk of a possible bid from China National Petroleum Corp (CNPC) was pure speculation, the company said.
Car and Driver
Panasonic‘s designs on rival Sanyo could produce an $8.7 billion deal, and analysts in Japan seem to think creating a solar power and hybrid car-battery powerhouse is a good fit for a green future. Panasonic runs a car battery venture with Toyota, while Sanyo offers nickel-metal hydride batteries to Ford and Honda and develops lithium-ion batteries for cars with Volkswagen. Unfortunately, the auto industry is a bit strapped right now. Both presidential candidates have vowed to make high-efficiency cars a big priority, so PanaSanyo must be thinking beyond automakers’ empty pockets. But so far, Detroit has had little luck impressing lawmakers with the need for taxpayer funding for the future of their industry, and one can only think that shipping dollars to Japan to buy batteries would be even less appealing in a recession. Shares of Panasonic rose 6.8 percent on Tuesday, while Sanyo rose 34.5 percent to its daily limit, helping the Nikkei average to a rise of 6.3 percent. Panasonic says nothing has been decided on a Sanyo purchase, but the Nikkei business daily reported a deal could be announced by Friday. If PanaSanyo wants to double-down its bet on the car market, it might also consider picking up XM Sirius – if nothing else, they can probably get it for a song.
Deals of the day:
* Want Want China, one of China’s biggest snack makers, said its chairman, Tsai Eng-meng, and family members had reached an agreement to buy Taiwan’s media firm China Times Group for an undisclosed sum.
* Tycoon Richard Li and China Netcom, the two largest shareholders of PCCW, have reached an agreement to buy out other shareholders of the city’s dominant fixed-line provider for up to $2.5 billion and take the company private, a newspaper reported.
* Japanese electronics conglomerate Fujitsu will buy Siemens 50 percent stake in their PC joint venture for 450 million euros ($567 million), aiming to boost its presence in Europe.
* Bezeq Israel Telecom, the country’s biggest telecommunications group, said it sold its satellite communications operations to RRsat Global Communications Network for $15 million.
* Bahrain Telecommunications (Batelco) declined comment on a newspaper report that Saudi Telecommunication was in talks with Bahrain’s sovereign wealth fund to buy up to 60 percent of Batelco.
