Was there ever any doubt that China, having donned the overalls of the world’s manufacturer, would ultimately emerge as a top bidder in the race for sputtering global auto assets? Not only does the country have the labor force to build the automobile of tomorrow, but increasingly it has the consumer class to buy it.
Bharti Airtel will not sweeten its offer for MTN now that exclusive talks between the two have been extended. Instead, the talks are about administrative issues, permissions and a scheme of arrangements, Bharti Chairman Sunil Mittal told the Economic Times. And the fate of Opel hangs in the balance, with General Motors poised to pick a buyer. Its board will address the topic later on Friday, sources told us.
General Motors’ upcoming Volt model will run up to 230 miles per gallon of fuel, but the saga to sell off its European operations seems equally long-lasting. The bidding process is now between two bidders — Magna International and RHJ International — with GM’s CFO Ray Young telling Reuters earlier that “everyone is anxious to get this thing done”.
Just a week after launching the cash-for-clunkers rebate program, policymakers and auto executives are left sorting through the chaos caused by the program’s runaway success.
As of Friday, there was no knowing how much longer funding for the program will last. The Obama administration has reassured car shoppers and dealers that any trade-ins over the weekend will be honored at rebates for up to $4,500. Meanwhile, the U.S. House rushed to triple funding for the program, adding another $2 billion in a bill that heads to the Senate where it could face tougher scrutiny.U.S. car sales for July, set to be released on Monday, are expected to show a turbocharged boost from the government program, a sleeper success in a string of policy steps aimed at stabilizing the U.S. auto industry that has included government-sponsored bankruptcies at GM and Chrysler.Before the rush of clunker trade-ins, analysts had been looking for industry-wide July auto sales to top 10 million units, the highest rate of 2009 and an encouraging sign the market has turned the corner. Investors have discounted some of that recovery. Shares in AutoNation, the No. 1 dealership group, have gained 48 percent since the start of the second quarter. Shares in the No. 2 dealership group, Penske Automotive Group, have more than doubled.With inventories tight, automakers also stand to gain as production — and revenues — increase in the second half. July sales data will help sort the winners from the losers, but the early anecdotal evidence suggests that the some of the biggest gains have gone to the automakers that were already outperforming. Hyundai says about 18 percent of its sales in the month of July included a cash-for-clunker backed trade-in. Ford, which is seeking to distance itself from the rest of Detroit, reports that cash-for-clunker trade-ins were boosting sales of smaller, more fuel-efficient cars as opposed to crossovers and trucks. That is also the area where Ford’s product line-up is seen as giving it an edge against GM and Chrysler.
Delphi may close to the finish line, bringing to a close its four-year-long bankruptcy. The Pension Benefit Guaranty Corporation says it will take over the pension plans of 70,000 Delphi workers and retirees. That can’t be anything but good news for potential bidders for Delphi assets.
A U.S. federal judge has authrorized the sale of General Motors’ most profitable assets to a “new GM,” backed by the government, in a move seen as crucial for the automaker to exit bankruptcy protection.
Lear is preparing to file for bankruptcy as soon as next week, The Wall Street Journal reported on Thursday, citing people familiar with the matter. The auto parts supplier’s lenders have agreed to waive defaults under its primary credit facility through June 30. The ventilator may still be working, but the decision on whether to pull the plug will soon be at hand.
GM cleared several of the hurdles on its way out of bankruptcy Thursday at a court hearing in Manhattan. The federal bankruptcy judge gave GM the final ok to tap the rest of its $33.3 billion bankruptcy financing and a lawyer for asbestos claimants withdrew a request for official committee status. Other obstacles including the status of non-union retirees rights to healthcare benefit– are on the agenda for the afternoon. We’ll be filing updates from the hearing in the live headline box below and on our Twitter feed.
After enjoying a bit of confusion from savior Fiat about the imperative of a June 15 deadline, and a quick, 24-hour trip to the Supreme Court, Chrysler creditors now know in no uncertain terms just how much political will there is behind getting the automaker’s government-orchestrated deal done.