Azure Dynamics launches North American shuttle bus program with sale of five hybrid electric shuttle buses to the Bronx  
TORONTO,-- Azure Dynamics Corporation (TSX - AZD & LSE - ADC) ("Azure Dynamics" or the "Company") a leading developer of hybrid electric and electric powertrains for commercial and military vehicles, is pleased to announce that it has launched a shuttle bus program in North America based on its G1 series hybrid powertrain product. Its first sale will be to The Bronx Overall Economic Development Corporation ("BOEDC"), to deliver five hybrid-electric, 20-passenger shuttle buses. The Bronx Clean Commuter Van Program is the first hybrid electric bus shuttle initiative in the borough.

The shuttle buses will employ the same chassis and hybrid electric drive system currently used in delivery vans supplied to other Azure customers such as Purolator Courier Ltd. The hybrid chassis will be fitted with conventional shuttle bus bodies. "This program is an important milestone for Azure as we are leveraging our series hybrid powertrain, currently incorporated in several other active programs, in a market that has considerable importance to many different communities," said Mark Federle, Azure's Vice-President, Sales.

As of July 15, 2005, 173 Mayors, representing 36 million inhabitants in U.S. cities, have signed The Climate Protection Agreement to meet or beat Kyoto Protocol emissions reductions goals. The agreement commits signatory cities to devise their own ways to reduce greenhouse gas emissions by at least 7 percent below 1990 benchmarks. It is this type of initiative that Azure Dynamics will assist through the sale of its shuttle bus and electric and hybrid electric product offerings. With support from funding sources like the Congestion Mitigation and Air Quality ("CMAQ") Improvement Program, who have already provided approximately $6.0 billion in funding for surface transportation and other related projects that contribute to air quality improvements and reduce congestion, Azure will expand upon its programs. Azure is currently in discussions with numerous municipalities in Canada and the U.S. regarding similar programs.

"This innovative project demonstrates that hybrid electric technology can be applied to shuttle buses, reducing diesel emissions while providing important transportation in areas severely underserved by public transit," noted Rafael Salaberrios, BOEDC President. The hybridized buses will operate approximately two to three shifts daily and are expected to drive between 160-240 miles per day, six days per week, all-year round. Three shuttles will provide service for workers at the Hunts Point Food Distribution Center, and two will replace vans currently used by non-profit organizations throughout the Bronx.

Funding for the Bronx hybrid electric shuttle bus program came in part from the Clean Air Communities ("CAC") which is collaborative initiative of NESCCAF - a sister-organization of NESCAUM - Con Edison, Natural Resources Defense Council, and the New York State Department of Environmental Conservation. BOEDC has committed approximately US$387,000 towards part of the program while the Clean Air Communities has committed US$300,000. Additional funding, in the form of a grant to BOEDC, was raised from the New York State Energy Research Authority (NYSERDA) in the amount of US$339,200.

The Bronx Overall Economic Development Corporation, established in 1981, is a community-based non-profit organization that has been a central figure in the revitalization of the borough. The Bronx contains two overlapping zones, the New York State Economic Development Zone and the federally-designated Bronx Empowerment Zone. BOEDC, as administrator of the Bronx Empowerment Zone and through its lending subsidiary, the Bronx Initiative Corporation, has facilitated economic incentives for businesses to start, expand and relocate to The Bronx and employ borough residents.

Azure Dynamics Corporation is a world leader in the development and production of hybrid electric and electric commercial and military vehicles and systems. The group estimates it has over 25 million miles of vehicle experience. Azure Dynamics' operations are based in North America and Europe.

Azure Dynamics is currently working internationally with various partners and customers including Purolator Courier Ltd., Canada Post, US Department of Defence, United States Postal Service, DHL, SEV Group Limited, Leyland Product Development and London Taxis International. Azure Dynamics Corporation is a public company trading on the TSX (AZD) in Canada and on AIM (ADC) in the UK.

Source : http://www.theautochannel.com (7/21/2005)

Reynolds and Reynolds Reports Third Quarter Results  
DAYTON, Ohio, -- The Reynolds and Reynolds Company today reported third quarter results. The company also announced it will no longer sell its Reynolds Generations Series Suite(R) dealer management system (DMS) resulting in a charge in the company's fourth fiscal quarter.

Reynolds reported revenues of $247 million for the third fiscal quarter ended June 30, 2005, which were 2 percent higher than a year ago. Net income was $24 million and earnings per share were 37 cents, 12 percent higher than a year ago. Third quarter earnings per share includes a 3 cent benefit primarily from lower tax rates.

Revenues in the company's largest segment, Software Solutions, were $201 million, 3 percent higher than a year ago. The Documents segment revenues declined 3 percent compared to a year ago. Revenues in the Financial Services segment declined 17 percent, as a result of continued lower interest rates and a decline in the size of the receivables portfolio.

"Unit sales of our industry-leading ERA(R) dealer management system were the strongest we've seen in two years. We're experiencing competitive pricing pressures we expect will continue," Fin O'Neill, president and CEO, said. "Sales of CRM solutions including Professional Services, Reynolds Web Solutions and Contact Management were solid during the quarter."

In the third quarter, Reynolds generated $42 million of operating cash flow. During the quarter, the company repurchased 1.7 million shares for $46 million at an average price of $26.98. Approximately 2.9 million shares remain authorized for repurchase.

The company announced the discontinuance of the Reynolds Generations Series Suite DMS software product, installed in over 70 dealership locations since its introduction in September 2003. As a result, in its fourth fiscal quarter ending September 30, 2005, the company will write off about $67 million of capitalized software development. The company is currently evaluating any other potential impacts of this decision and may recognize additional costs in the fourth fiscal quarter.

"Suite captured the vision of what the dealer management system of the future should be. Unfortunately, we have concluded that Suite is not the broad-based solution for the majority of the U.S. automotive retail market that we originally believed," O'Neill said. "Suite requires substantial change in dealership processes to provide the desired utilization levels and benefits. Implementation and training costs are high for our customers and for Reynolds and Reynolds. To appeal to the majority of automobile dealers, and address a number of product issues we have identified would require a continued, significant investment of money, technical resources and time that we cannot justify. We will work with each Suite customer to develop a plan to migrate off Suite over the next 24 months. Customers can be assured of our support until all migrations have been completed," he said.

O'Neill said that the decision to discontinue Suite frees up capital and development resources, allowing the company to accelerate investments to make platform upgrades and architectural enhancements and build out performance- based applications and services to provide its customers with the most cost- effective and productive solutions.

"In particular, we will be stepping up our investment in our ERA dealer management system," O'Neill said.

ERA is the number one, broad-based DMS solution in the industry and is used by over a half million dealership personnel at more than 10,000 dealership locations.

"We are listening to our customers. They tell us that they want a product that meets both the complex reporting and analytical needs of dealership management while offering the simplicity demanded by other dealership operations. They also want a system that meets the changing needs of automotive retail. However, they want a system that is evolutionary, one that will allow them to migrate to the system of the future, without the expense and disruption of introducing new processes and procedures throughout the dealership. Most importantly, they want a DMS that offers true integration with key dealership applications such as customer relationship management and Finance & Insurance. They are tired of cobbling together multiple solutions from multiple vendors. Reynolds hears them and will deliver the deep integration and the one-stop-shopping solutions that dealers want. Our decision to increase investment in ERA and related applications will allow Reynolds to deliver the high performance dealers want from their DMS of the future, while offering the smooth transition they need. This decision on our DMS direction is in the best interests of our customers, our shareholders and our associates.

With ERA, Reynolds has developed a proven DMS family with ERA ES, ERA XT and ERA XTR meeting the needs of the smallest to the largest dealerships. As the industry's leading dealer services provider, the company has introduced a large number of deeply integrated, market-proven CRM and other applications that deliver strong business results for our customers -- among them, Reynolds Web Solutions, Contact Management, Advanced Reporting, Mobile Service Advisor, Integrated Desking, eContracting, built-in "Do Not Call" flags, Internet Credit Reporting, F&I forms libraries, Electronic Document Management, built- in OEM vehicle option data, bar code systems and much more.

Outside the U.S. and Canada, Reynolds delivers the incadea(R) platform, which the company acquired in 2003. incadea now serves over 12,000 users at over 600 dealership locations in 27 countries. incadea's customer base serves franchises representing a broad cross section of the automotive industry through a network of more than 20 partners. The franchises include: Alfa Romeo, BMW, Opel, Ford, Citroen, Peugeot, Renault, Mazda, Mercedes-Benz, Volvo, Fiat, Lada and Kia.

"We are a dealer services company. Our value lies in being a total solutions provider, delivering the systems, applications and services that dealers need - from consulting to networks to documents to technology to support," O'Neill said. "Everything we do as a company must be focused on helping dealers sell and service more cars, take better care of their customers, drive down costs and become more profitable. That is our mission. That is why we and our customers will succeed."

Reynolds also announced that it is exploring strategic alternatives, including divestiture, for its Networkcar business. Reynolds acquired Networkcar in 2002. Since then, the business has evolved from dealership- based retail sales to a fleet management tool. Presidio Merchant Partners LLC, a San Francisco-based investment bank, is acting as a financial advisor to Reynolds on Networkcar.

"Networkcar is a growing, award-winning leader through its GPS tracking and diagnostic monitoring system," said O'Neill. "However, its transition to a fleet emphasis positions it outside our strategic core."

Source : http://www.theautochannel.com (7/21/2005)

Tenneco boosts Q2 net income  
Tenneco Automotive has reported second quarter net income of $US33 million, or 71 cents per diluted share, up from net income of $30 million, or 69 cents a share, a year ago.

The company generated its 13th consecutive quarter of year-on-year growth with revenue of $1.180 billion, compared with $1.113 billion a year ago.

Favourable currency benefited revenue by $33 million. Total OE revenues were up 7% year-on-year, outpacing a 2% increase in global industry production.

The company's gross margin in the quarter was 20.3%, down 1.3% from a year ago. Higher steel costs, restructuring charges and business mix offset savings and improved efficiencies.

Total steel cost increases in the second quarter were $35 million, which were largely offset by the company's cost reduction efforts.

Based on the company's efforts to offset increased steel costs and trends in the steel market, Tenneco doesn't anticipate a significant year-over-year impact on operating results for the remainder of 2005.

Source : http://www.just-auto.com (7/21/2005)

Legislation Aims At Automobile Recalls  
Auto manufacturers recall millions of vehicles each year, but those notices don't always make it to the vehicle owner's mailbox.

The federal government requires manufacturers to send one notice to the current registered owner, but some never receive the notice, and others may mistake it for junk mail, leaving thousands of vehicles with safety defects on the road.

State Sen. Debra Bowen, D-Redondo Beach, wants manufacturers to pass on recall information to the Department of Motor Vehicles, which would then put it on the vehicle's registration notice just like when the car needs a smog test.

"These are safety-related recalls, where there's a risk, where someone will be seriously injured or killed," Bowen said. "As many channels of notification as you can use are good."

Even though one large automaker -- Honda -- supports the bill, the DMV opposes it, saying it duplicates the federal notification process. The DMV also says there are problems with the bill, including timing. The bill says customers would get notification when their registration is due, not when the recall comes out, which DMV officials say could cause customer confusion, leading them to contact the DMV for answers, which could lead to longer wait times in line or on the phone.

The DMV estimates the extra work hours would cost almost $1 million the first year and $90,000 each year after that.

Bowen questions the costs and says it's tough to put a price on saving lives.

"The trade off is pretty easy to calculate," Bowen said.

The bill still has to clear the full Assembly.

Source : http://www.thekcrachannel.com (7/21/2005)

Ford Motor's sales in China up 22% in 1st half of year  
BEIJING,-- Ford Motor Co., the second-biggest U.S. automaker, said it sold 22 percent more vehicles in China in the first six months of 2005, compared with last year.

The automaker sold 33,621 imported and China-made vehicles during the period, the company said in an e-mail statement.

Ford, which announced a US$1.5 billion investment in 2003 to expand its production and catch up with General Motors Corp. and Volkswagen AG, is closing the sales gap after introducing new models like its Fiesta and Mondeo compact cars. Like other rivals that have invested more money earlier in China, Ford has reported a sales growth after China's car buyers, deterred last year by a price war among assemblers, returned to showrooms this year.

Ford said it sold 11 percent more Mondeo and Fiesta cars, compare with last year.

"Focus is going to be a major driver in the continued sales growth of Changan Ford in the second half of the year," Ford said. Ford will start selling Focus cars made by its venture Changan Ford Automobile Co. Aug. 1.

Ford and other foreign automakers are benefiting from rising vehicle demand in China. Demand for passenger cars in China may surge by 69 percent over the next five years to 5.05 million units by 2010, up from an expected 3 million units in 2005, according to a forecast by the China Association of Automobile Manufacturers.

China's vehicles sales rose 9.4 percent to 2.79 million units in the first half with passenger car sales expanding 10.6 percent to 1.84 million units, according to the association.

Source : http://news.xinhuanet.com (7/21/2005)

PPG Posts Record Sales for Any Quarter  
PPG Industries reported today second quarter net income of $231 million, or $1.34 a share, including aftertax charges of $12 million, or 7 cents a share, for a previously announced debt refinancing, and $2 million, or 1 cent a share, to reflect the net increase in the current value of the company's obligation under its asbestos settlement agreement reported in May 20, 200502. Sales were $2.66 billion, a record for any quarter.

That compares with second quarter 2004 net income of $187 million, or $1.08 a share, which includes an aftertax charge of $6 million, or 3 cents a share, to reflect the net increase in the value of the company's obligation under the asbestos settlement agreement. Sales for the second quarter of 2004 were $2.43 billion.

For the first six months of 2005, PPG recorded net income of $326 million, or $1.89 a share, which includes aftertax charges of $91 million, or 52 cents a share, for a nonrecurring legal settlement; $12 million, or 7 cents a share, for debt refinancing; and $7 million, or 4 cents a share, to reflect the increase in the value of the company's obligation under the asbestos settlement agreement. Sales for the first half of 2005 were $5.15 billion.

For the first six months of 2004, PPG recorded net income of $306 million, or $1.77 a share, which includes an aftertax charge of $9 million, or 5 cents a share, to reflect the increase in the value of the company's obligation under the asbestos settlement agreement. Sales for the first half of 2004 were $4.69 billion.

"We not only generated record sales for any quarter, we also enjoyed one of our best quarterly earnings performances ever," said Charles E. Bunch, chairman and chief executive officer. "In addition, we made progress in restoring our coatings margins and expect this improvement to accelerate the remainder of the year.

"While the global economy shows signs of moderating, we see continued strength in our coatings and chemicals segments, which achieved record sales each of the past two quarters. This measurable proof validates our earnings growth strategies and positions PPG to continue generating shareholder returns."

Coatings sales increased $96 million, or 7 percent, as a result of improved selling prices across all businesses except automotive, the impact of foreign currencies and higher volumes in architectural, aerospace and automotive. Operating earnings were down $14 million largely because of the impact of inflation, primarily raw materials, which exceeded the benefits of higher selling prices, higher volumes, slightly better costs and the impact of foreign currencies.

Glass sales decreased $3 million, or 1 percent, as lower selling prices and lower volumes across all businesses except automotive replacement glass exceeded the impact of foreign currencies. Despite improved manufacturing efficiencies, operating earnings were down $18 million as a result of inflation, including higher energy costs; lower selling prices; and lower other income.

Chemicals sales increased $134 million, or 27 percent, on higher selling prices for chlor-alkali products, higher volumes in optical and the impact of foreign currencies. Operating earnings were up $102 million primarily due to higher selling prices and improved volumes. These increases exceeded the impact of higher energy and other inflation costs and higher overhead expenses, related primarily to optical advertising.

Source : http://www.theautochannel.com (7/21/2005)

Alcoa Recognized By Ferrari With President's Award  
Alcoa announced today that it has received the Podio Ferrari 2005 "President's Award" in recognition of "the company's partnership with Ferrari on one of the essential components in the success of the Prancing Horse cars - the aluminum chassis."

Alcoa supplied the first-generation aluminum spaceframe for the Ferrari 360 Modena, and currently makes the aluminum spaceframes for the Ferrari 612 Scaglietti and F430. The award was presented by Ferrari Chairman Luca Cordero di Montezemolo to Alcoa Chairman and CEO Alain Belda in Maranello, Italy.

"The partnership between Ferrari and Alcoa has been a case study in technology, innovation and a shared passion for performance - from the laboratory to the production line to the road," Belda said. "Both companies have pulled on each other, pushed the other to new levels of achievement. The proof is in the success and performance of the 360 Modena, 612 Scaglietti and F430."

15,000 Red Miles Tour of China

As a testament of the ruggedness and performance of the 612 Scaglietti, Alcoa is a key sponsor of Ferrari's 15,000 Red Miles Tour of China. Two 612 Scagliettis leave Shanghai on Aug. 2, 20059, 2005 and travel a 15,000-mile route that will include passing the Great Wall, the Gobi Desert and the ancient city of Kashi, site of Marco Polo's famous silk market. During the 45-day tour, the sports cars will travel through vastly different terrains that include the desert as well as the tropics. No other automotive manufacturer has ever undertaken such a daunting task.

"We are excited to partner with Ferrari to showcase the durability and strength of the 612's aluminum spaceframe," said Misha Riveros-Jacobson, president, Alcoa Advanced Transportation Systems. "This challenge enables Alcoa to showcase the capabilities we can bring to our customers."

Ferrari: New Concepts for the Myth

Alcoa will also partner with Ferrari and Pininfarina in the global design competition, "Ferrari: New Concepts for the Myth," featuring designs for future Ferrari cars from students at four leading design schools in Italy, the United States, England and Japan.

"The design competition will challenge what will certainly be the auto industry's next generation of designers to think creatively about the future application of automotive aluminum," Belda said.

Keys to the Partnership

Four key elements that have been important to the success of the Ferrari/Alcoa partnership include:

-- Ferrari's willingness to involve Alcoa early in the vehicle spaceframe development process;

-- Alcoa's ability to achieve a balance between the strengths of several aluminum product forms as well as develop complex manufacturing technologies;

-- both companies' openness to candid, two-way communication; and

-- a shared passion for performance and innovation.

"The world knows that the Ferrari brand stands for passion, technology and performance," Belda said, when accepting the President's Award. "I hope that Alcoa's selection for this presidential citation demonstrates that when performance counts, Ferrari counts on Alcoa."

Source : http://www.theautochannel.com (7/21/2005)

Western European new car market down 0.71% in first half  
JATO reports that the Western European passenger car market fell slightly in the first six months of 2005, by 0.71% to 7,941,285 units. However, the market continues to recover from falls earlier in the year. June registrations rose 2.49%, compared to June 2004, to 1,474,971 units.

The volume lower- and upper-medium segments showed solid, product-led growth in the first half of 2005, thanks particularly to the new Vauxhall/Opel Astra, Peugeot 407 and new Volkswagen Passat. The premium-compact lower medium segment performed particularly strongly, up 45.3% (79,392 units).

SUV sales were 11% higher than in the first six months of 2004. Supermini, the largest segment, lost volume (down 5.9%) and share (down 1.6%).

The market in Denmark grew 25% in the first half of the year, with Ireland, France, Portugal and Spain also recording significantly increased car sales. Austria, Finland, Germany, Luxembourg and Norway saw sales at a similar level to the first six months of last year. Switzerland, Hungary, Greece and Great Britain recorded declines of 5-10%, and The Netherlands and Belgium also recorded slight reductions in the size of their car markets. In Italy, where a four-week strike by transporter drivers held up deliveries last month, June sales were up 18% compared to June 2004, although the market there is 5.7% down overall year-to-date.

The names heading the brand league table in June were unchanged from May, although Fiat moved up one place in the ranking, to eighth. BMW (up 20.7%) and Toyota (up 14.8%) recorded significant sales increases compared to June 2004, while top-selling brands Renault (up 0.7%) and Volkswagen (up 1.3%) also performed strongly. Outside the top 10, Kia was the fastest-growing volume brand, with first-half sales up 62.3%. Several niche brands recorded high percentage increases; they included Cadillac, up 177%, Ssangyong, up 248% and Aston Martin, up 362%.

Volkswagen's Golf was Europe's best-selling car for the first half-year, with 268,784 units registered, ahead of the Opel/Vauxhall Astra whose 210,214 units were 50% up on the first half of 2004. Ford's Focus (229,377 units) and Peugeot's 206 (232,072 units) and 307 (202,220 units) completed the top five models over the first half. The top three all increased sales in June: Astra by 21%, Focus by 16.6% and Golf by 3.7%

SUVs were the fastest-growing segment of the market in the first half-year, with sales up 11% (49,817 units) to take 6.4% of the total market. Increasing antipathy to 4x4s from environmental groups is not slowing this sales growth, which was 14.9% higher in June, compared with June 2004.

Lower medium cars increased their share of the market by 2% with an increase of 7.8% (146,252 units) in first-half sales. Mini MPV sales grew by 2.4% (16,445 units) over first half of 2004 but year-on-year sales for June were down 1.7%.

First-half sales in the Mini segment were down 7% compared to 2004, although June registrations were up 6.42%. FiatÕs Panda continues to lead the segment, with sales up 3.4% YTD and 12.1% in June. The Czech-built Peugeot 107, Citro‘n C1 and Toyota Aygo took a combined 9.1% share of June registrations in the segment as the PSA/Toyota small car joint venture increased its impact.

Superminis share of the market slipped 1.6% in the first half of 2005 as registrations fell 5.9% (145,188 units) in spite of successful introductions such as Renault's Modus, which achieved over 100,000 sales to reach 9th place in the segment YTD. The segment performed more strongly in June, with sales down only 0.8% compared to June 2004.

The volume Lower Medium segment rose 3.9% in the first half and 6.6% in June. Segment leaders Volkswagen Golf, Opel/Vauxhall Astra and Ford Focus all saw sales rise. New models doing well included Mercedes-Benz A-Class in 7th place, up 45.4%, and Kia Cerato, showing a 572% improvement on the combined sales of its Sephia/Mentor and Shuma predecessors in the first half.

First half sales in the fastest growing segment, Premium-compact lower medium, rose 45.3%. The segment leader, AudiÕs A3 increased sales by 28.6% in the first half, ahead of BMWÕs 1-Series. ToyotaÕs Prius hybrid scored a notable fourth place, with sales up 169% YTD and up 254% in June.

The volume Upper medium segment continues its resurgence, with first half registrations up 2.7% and June sales up 8.4%. Segment sales account for 10% of the total car market; one percentage point ahead of Mini MPVs. Volkswagen Passat took the lead in June, with PeugeotÕs 407 leading over the first half.

BMW's new 3-Series took the lead in the Premium upper medium segment in June. Nevertheless, this segment saw sales fall 12.5% in the first half of 2005 despite several launches of new and improved models.

Executive car sales were down 2.84% in the first half, while the tentative recoveries in April and May slowed in June to a growth of only 0.57%. BMW 5-Series leads the segment from the Mercedes-Benz E-Class and new Audi A6, which was up 32.9% YTD.

Luxury car registrations fell much more steeply in the first half, by 16.4% but June showed some signs of stabilisation, with only a 1.76% fall. Bentley Arnage sales rose 73.6% and Volkswagen Phaeton sales 25% in the first half. BMW 7-Series leads the segment.

Sales in the Mini MPV segment grew 2.7% in the first six months of 2005 but June registrations were down 1.68%. Renault ScŽnic/Grand ScŽnic led the segment in June. Fiat Multipla, up 145% YTD, and VolkswagenÕs new Caddy, up 217% YTD, showed strong growth.

Full-size MPV sales continued their steady decline, down 18.6% in the first six months. Renault Espace and Volkswagen Sharan led in the first six months.

Toyota's RAV4 maintained its lead in the buoyant SUV segment, where sales grew 11% in the first half of 2004, accelerating to 14.3% growth in June. Second-placed BMW X3 was up 96.2% in the first six months, with the new Hyundai Tucson, Nissan X-Trail, and Suzuki Vitara/Grand Vitara/XL-7 completing the top five.

After strong product-driven growth in 2003 and 2004, the Sports segment slowed during the first half of this year, recording only a 0.77% rise in registrations. June sales fell 1.30%. Aston Martin's DB9 performed well, outselling much more affordable models such as the Jaguar XK and Volvo C70.

Source : http://www.autoindustry.co.uk (7/22/2005)

IMI recruits new business team to aid expansion  
The Institute of the Motor Industry (IMI) is aiming for significant membership growth with the appointment of two new business development managers. Jamie Redmond, formerly human resources manager, William Jacks plc and Martin Whetnall, who joins the IMI from automotive training provide, ReMIT, will be responsible for generating new opportunities for the industryÕs professional association and leading qualifications awarding body in the automotive sector.

15,000 new candidates were registered on IMI qualifications during the 2004/5 financial year, representing an increase of more than 20% on the previous year. More than 2,000 individuals applied for IMI membership, a cumulative increase of 10%. Total membership of the IMI now stands at 25,000 with a retention rate of over 95%. A further 46,000 students, aged between 14 and 25, are registered on nationally recognised qualifications awarded by the IMI.

An increase in the number of assessed training programmes across the sector, which have been linked to IMI membership through its Quality Assured Awards (QAA) programme, has contributed to the rise in membership recruitment.

Source : http://www.autoindustry.co.uk (7/22/2005)

Lincoln Takes Top Spot in Customer Satisfaction With Dealer Service  
For the second year in a row, Lincoln has taken the top spot in customer satisfaction with dealer service, as measured by J.D. Power and Associates. Lincoln ranked a record-setting 915 on a scale of 1,000.

The study, now in its 25th year, measures the customer satisfaction of vehicle owners who visited the dealer service department for maintenance or repair work during the first three years of ownership, which typically represents the vehicle warranty period.

Overall customer satisfaction is based on six measures: service initiation, service advisor, in-dealership experience, service delivery, service quality and user-friendly service.

Lincoln outperforms other brands in the areas of service initiation and user-friendly service. Lincoln customers are particularly pleased with the dealership's ability to get them in for an appointment within a reasonable amount of time and the fairness of charges. Lincoln is the first domestic make to rank highest in CSI for two consecutive years.

Lincoln is followed in the rankings by Cadillac, Saturn and Lexus, respectively.

The study finds that 51 percent of repair work involved a recall -- up from 39 percent in 2004 -- reflecting, in part, a change in government regulations on mandatory reporting of vehicle safety defects.

CSI scores are, on average, considerably higher for repairs that involve recalls, particularly in the area of service quality. Recall work often tends to garner higher satisfaction than typical repairs because dealers plan for and communicate the work to customers better. As recall repairs become routine, technicians become more efficient and consistent in fixing the problem.

"As negative as recalls are for manufacturers, they provide dealerships with opportunities to excel in service and make a positive impact on their customers," said Steve Witten, executive director of automotive retail research at J.D. Power and Associates.

"When a vehicle is fixed quickly and correctly in one visit, customers tend to walk away with higher satisfaction. This typically occurs with recall work since the dealers are prepared to work on the specific problem. Manufacturers may consider applying lessons learned from recall campaigns to regular repair service."

The study also finds that brands receiving high ratings from customers for service satisfaction benefit as well in terms of loyalty, both in the likelihood of customers returning to the dealer for in-warranty and post- warranty work and in intentions to repurchase from the servicing dealer. This is particularly important when the warranty period ends.

Creating strong relationships with customers during the first few years of ownership significantly influences customer retention during the post-warranty period, according to the J.D. Power and Associates 2005 Service Usage and Retention Study (SURS), which measures the same elements as CSI but at four to five years of ownership, when most warranties have expired.

"After one year of ownership, nearly one-third of customers turn to non- dealer facilities to service their vehicle," said Witten. "This percentage increases to more than one-half by the time the vehicle is five years old."

"While most independents have the advantage of being small operations that offer more personal service, manufacturers and dealers can develop programs that foster personal relationships between service advisors and customers," he said.

According to the survey and retention study, independent service providers typically outperform dealers in the key drivers of service satisfaction, including getting customers their appointment on the desired day; waiting on customers immediately; telling customers when their vehicle will be ready and consistently delivering on that promise; fixing the vehicle right the first time; and explaining the work performed and associated charges.

Brands that perform particularly well in service satisfaction among owners of four- to five-year-old vehicles include luxury brands Acura, Cadillac, Infiniti and Lexus.

The 2005 CSI Study is based on responses from 99,550 owners and lessees of 2002 to 2004 model-year vehicles. The 2005 SURS is based on responses from 11,016 owners of 2000 to 2001 model-year vehicles.

Source : http://www.consumeraffairs.com (7/21/2005)

PACCAR Highlighted as a Leading Manufacturing Company by Industry Week Magazine  
PACCAR Inc has earned the distinction of being selected by Industry Week magazine as one of the 50 best manufacturing companies in the United States. "It is an honor for PACCAR to be recognized with other leading companies including Dell, Johnson & Johnson, Chevron and 3M," said Mark C. Pigott, chairman and chief executive officer. "As the company celebrates its 100-year anniversary during 2005, this wonderful recognition reflects the dedication and talent of PACCAR employees worldwide."

To select the top 50 performing companies, Industry Week evaluated three-year performance measures including revenue growth, profit margin, asset turnover, inventory turns, return on assets and return on equity. Performance for 2004 was weighted more heavily in the survey.

"PACCAR's global diversification has been integral to the company's steady revenue and profit growth," noted Mike Tembreull, vice chairman. "During 2004, over 50 percent of PACCAR's revenues were generated outside the United States. During the past decade, PACCAR's earnings per share have grown by 16 percent per annum versus 7 percent for the S&P 500. PACCAR's return on equity has averaged 21.5 percent during the last three years and was 27.9 percent for 2004."

PACCAR is a global technology leader in the design, manufacture and customer support of high-quality light-, medium- and heavy-duty trucks under the Kenworth, Peterbilt and DAF nameplates. It also provides financial services and information technology and distributes truck parts related to its principal business.

PACCAR shares are traded on the Nasdaq Stock Market, symbol PCAR, and its homepage can be found at www.paccar.com.

Source : http://www.theautochannel.com (7/21/2005)

Johnson Controls claims record Q3 results  
Johnson Controls has reported record results for the third quarter of fiscal 2005 with earnings of $1.31 per diluted share (EPS) from continuing operations, up 21% over $1.08 for the prior year.

Sales for the 2005 third quarter increased 9%, to $7.1 billion, from $6.5 billion in the 2004 quarter, reflecting growth by each of its businesses.

Operating income for the 2005 quarter was $368 million, up 7% from $343 million. Income from continuing operations increased 22%, to $255 million versus $209 million.

On April 1, 2005, a seating and interiors joint venture was deconsolidated due to a change in operating control. The deconsolidation, which had no impact on after-tax income from continuing operations, reduced third quarter sales and operating income as the company's interest in the joint venture is now reported as equity income.

All 2004 amounts have been restated to reflect the 2005 divestitures of the company's engine electronics and world services businesses.

For the fourth quarter and full year of 2005, Johnson Controls expects consolidated sales of approximately $7 billion, an estimated 8-9% increase over $6.4 billion for 2004; full-year sales of nearly $28 billion, up from $25.4 billion for 2004.

Fourth-quarter EPS from continuing operations of $1.48 to $1.52 are expected, approximately 21% to 25% higher than $1.22 for 2004. For the 2005 full-year, EPS from continuing operations of $4.39 to $4.43 are forecast, a 16-17% increase from $3.79 for 2004.

Capital expenditures in the 2005 third quarter were $104 million, down from $186 million the prior year. For the first nine months of 2005, capital expenditures totaled $396 million, down from the $595 million for the same period of 2004. The anticipated decline in spending from the unusually high 2004 level of capital projects also reflects the company's focus on improving the productivity of its existing assets.

Source : http://www.just-auto.com (7/21/2005)

Cherished number rule change bill passes first reading  
Proposals to change the rules surrounding cherished number plate sales had a successful first reading in Parliament yesterday (Wednesday 20 July 2005), according to the Retail Motor Industry Federation.

The Vehicle Registration Marks Bill proposing to change the rules surrounding cherished number plate sales passed its First Reading in the House of Commons on 20 July. A date for the Second Reading has been set for Friday 11 November 2005.

Mark Hendrick, MP for Preston, tabled the motion under the 10 minute rule to amend the current legislation so that the assignment rights of a cherished number could be transferred directly to the new keeper at the time of initial retention.

During the debate, Hendrick said: “The Driver and Vehicle Licensing Agency (DVLA) and the Cherished Number Dealers Association are strongly in favour of the proposed changes.”

He continued: “There have been several cases of organised criminal activity aimed at acquiring valuable numbers by illegal means. I propose the introduction of an option for third parties to be granted entitlement as soon as the number is placed on hold under the retention facility. The bill would aid the industry involved in buying, selling, and transferring registration marks with no additional costs to Government.

”It would amend the Vehicles Excise Registration Act 1994 to simplify the administrative process for selling cherished registration numbers and would be warmly welcomed by many customers, as well as cherished number dealers.”

Source : http://www.autoindustry.co.uk (7/22/2005)

New US plan to spur commercialization of biofuels  
A new report suggests that America can produce 25 per cent of its transportation fuel needs from agricultural crop wastes - utilizing new processes developed by the biotechnology industry - while reducing carbon and greenhouse gas emissions.

'Bringing Biofuels to the Pump,' from the National Resources Defense Council, recommends that the US invest $1 billion over the next 10 years in bio-ethanol commercialization to "drive the development of the first billion gallons of bio-ethanol capacity at a price approaching that of gasoline and diesel."

The Biotechnology Industry Organization supports that recommendation and agrees with the NRDC that development of cellulosic biofuel is economically and strategically vital to helping end America's dependence on imported oil.

"The Senate version of the energy bill [HR 6] currently in conference committee contains an 8 billion gallon renewable fuel standard and establishes a reverse auction for the production of the first billion gallons of ethanol made from cellulose-containing crop wastes," said Brent Erickson, BIO Executive Vice President of Industrial and Environmental Biotechnology. "We could be producing up to 25 percent of our transportation fuel needs in the not-too-distant future by combining biotechnology and agriculture to produce bioethanol, and this energy bill will be a big stimulus to help us meet that goal," he added.

A study by academics from Cornell and California Universities reported earlier this week on www.autoindustry.co.uk disputed the economic benefit of biofuels usage, calculating that whichever crop is used for ethanol production, the energy used in the process, inclusive of transport and other costs allegedly ignored by earlier studies, exceeded the biofuels’ gross C02 output advantage.

Source : http://www.autoindustry.co.uk (7/22/2005)

Surf sat-nav on a Nissan X-Trail  
Nissan has launched a special edition X-Trail off-roader that's cheaper than standard models but fitted with satellite-navigation.

Available with the 2.5-litre petrol engine at £18,995 or the 2.2-litre diesel for £20,295, the Fat Face special editions save £1850 over a regular Sport model.

A tie-in with the clothing company, the special editions also carry Fat Face badging and all the equipment normally fitted to Sport models. This includes cruise control, alloy wheels, climate control, remote central locking and a CD stereo.

What Car? Target Price mystery shoppers say the Fat Face cars should be available with the same discounts as standard models in the range. Aim to pay from £18,092 for the petrol and £19,331 for the diesel.

Until now satellite-navigation has only been standard on the range-topping T-Spec versions, which cost from £22,895.

Source : http://www.whatcar.co.uk/News_Article.asp?NA_ID=216239 (7/21/2005)

BMW to launch thermal imaging in 3 & 5 Series this autumn  
Two new safety innovations will be available on BMW models from this autumn when Night Vision and Gentex’s High-Beam Assistant automatic headlight dipping system, reported earlier this week, will be offered for the first time.

Night Vision uses a thermal imaging camera to ‘illuminate’ pedestrians, animals or any objects emitting heat up to 300 metres ahead of the car – twice the distance illuminated by bi-xenon headlights. Infrared technology generates a clear image of the road ahead on the iDrive screen and the system is said to be particularly effective on long stretches of unlit road or motorway.

Source : http://www.autoindustry.co.uk (7/22/2005)

STAR publishes technology update for franchised dealers  
Standards for Technology in Automotive Retail (STAR), a global Information Technology (IT) standards body for the retail automotive industry, has released a new version of their Dealership Infrastructure Guidelines (DIG). The publication describes the types of IT equipment and services needed for franchised auto dealers to conduct day-to-day business with auto manufacturers and other business partners.

The latest release of the DIG (version 2005 v2.0) includes new guidelines for dealers who use portable, wireless computers in their dealerships' showrooms or service areas. The document emphasizes the need to implement adequate security measures to protect the dealer's business information and computer equipment.

STAR's initiatives are designed to to improve the daily business activities of dealers, retail systems providers, and manufacturers.

Source : http://www.autoindustry.co.uk (7/22/2005)

F1 Teams Win Awards at CFD Conference  
Representatives of two Formula One teams won awards at the recent ‘European Automotive CFD Conference' held by the computational fluid dynamics software developer Fluent Inc in Frankfurt, Germany on June 29-30.

At the biennial conference both the Ferrari and Sauber Petronas teams presented papers on the new age of the Supercomputer in F1, which allows teams with this capability to perform CFD simulations of a full F1 car within a day. In an awards presentation at the end of the conference Luciano Mariella of Ferrari won ‘The Best Use of a Supercomputer' prize sponsored by AMD, and Tobjörn Larsson of Sauber Petronas won the ‘Best Automotive CFD Animation' award, sponsored by Genias Graphics.

A book and CD of the proceedings containing every paper presented at the EACC can be ordered from www.eacc.fluent.com

Source : http://www.autoindustry.co.uk (7/22/2005)

Honda aims high  
Honda aims to boost its annual vehicle sales by about 25% over the next three years to 4 million vehicles, president Takeo Fukui said, outlining the Japanese automaker's ambitious global growth strategy. Honda Motor Co. expects to increase annual sales by 16% by the fiscal year that ends March 2008 to $89 billion, he said in announcing a three-year business plan.

Source : http://www.freep.com (7/21/2005)

The Midland Company Reports Record Second Quarter Results  
The Midland Company , a highly focused provider of specialty insurance products and services, today reported record results for the second quarter ended June 30, 2005. Net income for the quarter was a record $20.7 million, or $1.06 cents per share. That compares with the previous record net income of $11.3 million, or 58 cents per share reported in last year's second quarter. This equates to an 83 percent increase in earnings per share on a quarter over quarter basis. All per share amounts are on an after-tax, diluted basis.

Net income before realized capital gains* for the quarter was a record $19.8 million, or $1.01 per share, up 80 percent (on a per share basis) from the year ago level of $10.9 million, or 56 cents per share. The company believes that this non-GAAP financial measure provides a clearer picture of the underlying operating activities than the GAAP measure of net income, as it removes potential issues such as timing of investment gains (or losses) and allows readers to individually assess these components of net income.

John W. Hayden, Midland president and chief executive officer, commented, "We are delighted with the continuation of the favorable earnings trend these record-setting second quarter results represent. They far surpass the previous record established in last year's second quarter, and were again driven by solid underwriting profits from our core property and casualty operations. We have delivered record results in each of our last three quarters, as well as a combined ratio of less than 90 percent in each of those periods. Our momentum is clearly evident, as is the power of our disciplined approach to underwriting specialty personal lines insurance risks."

"We are very pleased with our underwriting trends across the board," Hayden said. "In particular, manufactured housing, site-built dwelling, motorcycle and excess and surplus lines posted solid underwriting results. We also enjoyed even more favorable weather conditions than a year ago, as the impact from catastrophes was 14 cents per share better than the second quarter of 2004 and approximately 25 cents per share better than we might normally expect in the second quarter," Hayden said. Catastrophe losses for the second quarter were 15 cents per share, compared to 29 cents per share a year ago.

Midland's wholly owned insurance subsidiary, American Modern Insurance Group, specializes in providing insurance products and services for niche markets such as manufactured housing, site-built dwelling, motorcycle, watercraft, snowmobile, recreational vehicle and credit life and related products. American Modern's products and services are offered through diverse distribution channels.

P&C Combined Ratio Impressive at 89.9 Percent

American Modern's property and casualty combined ratio (losses and expenses as a percent of earned premium) was 89.9 percent in the second quarter, compared with 96.5 percent a year ago. This outstanding performance was largely driven by solid underwriting results from specialty products such as manufactured housing, site-built dwelling, motorcycle and excess and surplus lines. Excluding catastrophe losses, American Modern's second quarter combined ratio was 87.1 percent, compared with 91.4 percent in the same period of 2004.

"We continue to see very positive underwriting momentum in our major product lines," Hayden said. "Our residential property lines, which include manufactured housing and site-built dwelling, had a terrific quarter as both products achieved sub-90 percent combined ratios," Hayden said. The manufactured housing combined ratio was 88.8 percent for the quarter, bettering an already solid mark of 93.6 percent last year. The site-built dwelling combined ratio for the second quarter was 89.1 percent, in line with last year's excellent result of 88.6 percent.

Hayden added, "Our rate actions and underwriting disciplines continue to yield very favorable results in the motorcycle line. For the quarter, motorcycle produced an after-tax net profit, including service fees and investment income, of three cents per share, compared to an after-tax net loss of eight cents per share in the second quarter of 2004. Our motorcycle results continue to be well ahead of our original plan, giving us confidence that we are on track to produce break-even or better underwriting results for the full year."

"Overall, we are extremely pleased with the underwriting performance of our specialty property and casualty product offering and are confident that our underwriting and pricing discipline will continue to serve us well," Hayden said.

Property and Casualty Premiums

American Modern's property and casualty gross written premiums for the second quarter were $183.4 million, down from $205.7 million in last year's second quarter. "There are several important items to consider when looking at our top-line result for the quarter," Hayden began. "In the second quarter of 2004, we assumed a book of collateral protection business. This assumed business totaled $17.6 million in the second quarter of 2004, including a one- time unearned premium pickup of $13.6 million. Our written premium from this book of business decreased by $14.7 million in the second quarter of 2005, to $2.9 million; this decrease was driven by last year's non-recurring unearned premium assumption."

"Next, the corrective actions we have undertaken to improve our motorcycle results have had a dampening effect on premium in that line. As we have said, we will not pursue growth at the expense of profit. This year's second quarter motorcycle combined ratio improved over 20 percentage points from a year ago, while our gross written premium for the line decreased quarter over quarter by $4.8 million. That said, we are anticipating the decline in motorcycle premiums to moderate, and we remain very confident in our ability to profitably grow this line over the long term."

Finally, while our manufactured housing premiums were essentially flat on a quarter over quarter basis, we actually consider this a very positive result. As we have previously stated, several lenders are no longer making new manufactured housing loans. Collectively, these accounts produced $8.2 million less in gross written premium during the quarter. We are pleased to note that exclusive of this trend, our manufactured housing premiums from all other sources actually grew by 13 percent in the quarter. The good news in this regard is that we believe the majority of the decline from these lenders should be mostly behind us in the next 18 to 24 months. For the full year 2005, we are anticipating an adverse top line impact of $30 million from these portfolios, and less than half that in 2006."

"We are keenly focused on growing all of our lines of business and growing them profitably. We believe that given the prevailing market dynamics, our full year 2005 top line premiums will likely be flat as compared to 2004. We are currently making significant investments in sales and marketing, and expect to harvest the benefits of these investments in the years to come," Hayden said.

Record Six-Month Results

For the six months ended June 30, 2005, net income was a record of $42.3 million, or $2.16 per share, which includes seven cents from realized capital gains. That is a 46 percent increase over last year's previous record net income of $28.2 million, or $1.48 cents per share, which included 18 cents per share in net capital gains.

American Modern's property and casualty combined ratio was 89.3 percent compared to 95.4 percent last year. Excluding the impact of catastrophe losses, American Modern's combined ratio for the first six months of 2005 was 86.8 percent, compared to 91.9 percent last year.

American Modern's property and casualty gross written premiums were $347.5 million for the first half of the year. Manufactured housing premiums decreased slightly from the prior year to $165.8 million.

Investment Portfolio, Book Value and Market Value Growth

The market value of Midland's investment portfolio increased to a record of $970.9 million at June 30, 2005, compared with $905.6 million at June 30, 2004. Net pre-tax investment income (excluding capital gains and losses) increased 13 percent to $10.2 million for the second quarter compared with $9.0 million in last year's second quarter. This increase is due primarily to the year-over-year growth of the fixed income portfolio. The annualized pre- tax equivalent yield, on a cost basis, of American Modern's fixed income portfolio was 5.3 percent in the first six months of both 2005 and 2004.

After-tax realized investment gains from Midland's investment portfolio totaled five cents per share in this year's second quarter compared with realized investment gains of two cents in last year's second quarter. Pre-tax net unrealized gains on Midland's fixed income portfolio were $21.7 million at June 30, 2005, up from $11.4 million at June 30, 2004. Pre-tax net unrealized gains on Midland's equity portfolio were $83.1 million at June 30, 2005, up from $80.0 million at June 30, 2004.

Midland's shareholders' equity increased to a record $468.0 million, or $24.75 per share, at June 30, 2005, up from $392.8 million, or $20.93 per share, at June 30, 2004, an increase of 18 percent. Midland's book value per share has grown at a compound annual rate of 12 percent over the last 10 years.

Hayden noted that, "Midland's common stock continues to outperform the broader equities market and virtually every relevant index for the 1-, 5-, 10-, 15- and 20-year periods ended June 30, 2005. We are extremely proud of this performance record and believe it is a good indicator of our company's intrinsic value."

Update Hurricane Dennis (Third Quarter Event)

Hurricane Dennis came ashore on the Florida panhandle and along the Alabama coastline on July 10. On the basis of information received to date, the company anticipates that net after-tax losses from this storm will be less than 10 cents per share. Generally, the third quarter is more susceptible to volatile weather patterns. The company typically would consider catastrophe losses of approximately 30 cents to be normal for the third quarter. In the third quarter of 2004, American Modern reported a net after-tax impact from catastrophes of 98 cents per share, driven largely by the four major hurricanes that hit Florida and impacted the southeastern United States in August and September of 2004.

Positive Outlook for 2005, Raise Full Year Earnings Guidance

"We continue to maintain a very positive earnings outlook for the remainder of 2005, and remain confident in the fundamentals driving our business results," Hayden said.

"In terms of guidance for the full year, we anticipate a combined ratio, assuming normal weather in the third and fourth quarters, in the range of 92.5 percent to 93.5 percent for 2005, noting that weather patterns and seasonal products such as motorcycle and watercraft tend to drive our combined ratio up during the third quarter. We also expect investment income to increase moderately given the larger base of invested assets," Hayden continued. "This level of underwriting profit and investment income should translate to net income before realized capital gains in the range of $3.25 to $3.45 per share."

"American Modern's outstanding performance in the first half of 2005 has buoyed our expectations for the full year," Hayden said. "Midland and the specialty insurance expertise of American Modern Insurance Group continue to deliver fundamental strength and fundamental value. We expect to fully leverage that strength and value in 2005 and beyond," Hayden concluded.

Source : http://www.theautochannel.com (7/21/2005)

Johnson Controls Reports Record Third-Quarter Results Provides Fourth-Quarter and Full-Year EPS Guidance  
MILWAUKEE,-- Johnson Controls, Inc. (JCI) the leading supplier of automotive systems and facility management and control, today reported record results for the third quarter of fiscal 2005 with earnings of $1.31 per diluted share (EPS) from continuing operations, up 21% over $1.08 for the prior year.

"We are pleased with our record performance for the third quarter," said John M. Barth, Johnson Controls Chairman and Chief Executive Officer. "Our disciplined approach to innovation, cost reduction and continuous improvement has enabled us to stay ahead of changes in the market environment and to support our customers. We also continued to make progress on our growth strategies, which were advanced by recent controls and battery-related acquisitions that expanded the scope of our product and service offerings and geographic capabilities."

Mr. Barth added "We expect to complete fiscal 2005 with a strong performance that is in line with our expectations. Our controls and battery businesses are in excellent shape and enable us to overcome challenges in the current automotive market. We extend our thanks to all Johnson Controls employees around the world for their dedication and outstanding performance."

For the fourth quarter and full year of 2005, Johnson Controls expects:

-Fourth-quarter consolidated sales of approximately $7 billion, an estimated 8-9% increase over $6.4 billion for 2004; full-year sales of nearly $28 billion, up from $25.4 billion for 2004.

-Fourth-quarter EPS from continuing operations of $1.48 to $1.52, approximately 21% to 25% higher than $1.22 for 2004. For the 2005 full-year, EPS from continuing operations of $4.39 to $4.43, a 16-17% increase from $3.79 for 2004.

A footnote provides non-GAAP reconciliations regarding pension, restructuring and one-time tax benefits.

Third-Quarter Results

Sales for the 2005 third quarter increased 9 percent, to $7.1 billion, from $6.5 billion in the 2004 quarter, reflecting growth by each of its businesses. Operating income for the 2005 quarter was $368 million, up 7% from $343 million. Income from continuing operations increased 22%, to $255 million versus $209 million.

On April 1, 2005, a seating and interiors joint venture was deconsolidated due to a change in operating control. The deconsolidation, which had no impact on after-tax income from continuing operations, reduced third quarter sales and operating income as the company's interest in the joint venture is now reported as equity income.

All 2004 amounts have been restated to reflect the 2005 divestitures of the company's engine electronics and World Services businesses. The results for these businesses are reported separately as discontinued operations in the Consolidated Financial Statements.

The company's financial position continues to strengthen. Total debt to total capitalization was 28.0% at June 30, 2005 versus 28.5% at the end of the second quarter of 2005, even after the completion of the controls-related acquisition of United Systems Integrators (USI) and the incurrence of debt to fund the Delphi battery acquisition, which closed on July 1, 2005.

Capital expenditures in the 2005 third quarter were $104 million, down from $186 million the prior year. For the first nine months of 2005, capital expenditures totaled $396 million, down from the $595 million for the same period of 2004. The anticipated decline in spending from the unusually high 2004 level of capital projects also reflects the company's focus on improving the productivity of its existing assets.

Third-Quarter Business Highlights

While auto industry production in North America and Europe decreased by an estimated 1% in the 2005 quarter, Johnson Controls seating and interiors sales increased 8% to $5.0 billion from $4.6 billion, with new volume more than offsetting the effect of the joint-venture deconsolidation. Operating income declined 9% to $199 million from $219 million as the deconsolidation impact more than offset the favorable effects of higher volume and operational improvements.

Battery sales for the third quarter were $665 million, up 24 percent from $535 million in the 2004 period, due primarily to the increase in ownership and consolidation of a Latin American battery joint venture in the fourth quarter of 2004, and higher original equipment and aftermarket unit shipments. Operating income was $76 million, up 35 percent from $56 million, as a result of the higher sales as well as improved quality and cost reductions.

Controls sales to the nonresidential buildings market rose 6 percent to $1.4 billion from $1.3 billion last year. The increase was primarily due to higher systems renovation activity and technical services revenues. Operating income rose 37 percent to $93 million from $68 million in 2004, as a result of the higher sales and an improved performance by the North American branch network. The USI acquisition, which expands the range of services in the company's facility management offering, had no material impact on the quarter's results.

The backlog of uncompleted control system installation and service contracts at June 30, 2005 increased 7% over the prior year amount. Orders increased in the quarter, reflecting growth in technical service and systems renovation contracts in North America.

Source : http://www.theautochannel.com (7/21/2005)

Power Information Network Reports: Employee Discounts Creating Desired Results for Big Three  
2005--Offering employee discounts to all consumers appears to be paying off for the Big Three in the form of increased sales and market share, according to actual retail transaction data from more than 6,200 automotive franchises compiled by the Power Information Network (PIN).

Both Ford Motor Company and DaimlerChrysler, now offering competitive employee discount pricing programs of their own, have rebounded in July from mediocre results in June when GM alone offered employee pricing.

Through the first 15 days of July, GM, whose GM Employee Discount for Everyone campaign extends across all of its vehicle brands, captured 30.3 percent of the retail new-vehicle market compared to 25 percent a year ago and 33.4 percent during the first 15 days of June, according to PIN. In addition, GM's retail sales were up 42 percent in July compared to a year ago.

Ford's share rebounded to 19.6 percent through the first 15 days of the month -- up from 15.1 percent in June and 18.1 percent in July 2004 -- and its retail sales jumped 27 percent versus a year ago. Ford Motor Company's Ford Family Plan offers an employee discount to all consumers for its Ford, Lincoln and Mercury vehicles.

DaimlerChrysler, whose Chrysler Group's Employee Pricing Plus program offers employee discounts on Chrysler, Jeep and Dodge vehicles, carried 12.5 percent of the market through the first 15 days of July -- up from 11.3 percent in June, but down from 13.3 percent a year ago. DaimlerChrysler's retail sales have climbed 11 percent versus July 2004.

"Although GM is tracking slightly behind its June numbers, the company is still having an impressive month," said Tom Libby, senior director of industry analysis at the Power Information Network. "Since Chrysler and Ford adopted similar programs, they are also seeing substantial sales increases."

The three major Japanese companies -- Toyota Motor, American Honda and Nissan Motor -- all have lost market share in July when compared to both June 2005 and July 2004. Toyota Motor has captured 12.6 percent market share, American Honda 8.4 percent and Nissan Motor 6.1 percent through the first half of July, each of which is down versus both June 2005 and July 2004. However, from a sales perspective, the major Japanese companies are holding their own. Nissan (up 22%), Toyota (up 17%) and Honda (up 16%) are all showing sales increases in July versus June, and all three are also up versus July of 2004.

"The domestic programs are expanding the overall market, which is lowering the Japanese companies' shares," said Libby. "But the Japanese are not selling any fewer vehicles than in the past; in fact, they are selling more vehicles than in both June and last July."

While July is shaping up to be another strong sales month, J.D. Power and Associates is holding its annual sales forecast at 16.9 million units.

"These programs are likely pulling forward some of the model year-end sales by a month or two," said Jeff Schuster, executive director of global forecasting at J.D. Power-LMC Automotive Forecasting.

Source : http://www.theautochannel.com (7/21/2005)

Ford, unit closer to junk  
Ford Motor Co. and finance arm Ford Motor Credit were nudged closer to junk status when Fitch Ratings sliced their credit ratings by a notch, leaving them a single step above speculative grade.

But the companies' bonds actually gained on the news due to Fitch's reiteration that the two are likely to remain investment-grade through the year.

Fitch downgraded the senior unsecured debt of Ford and Ford Motor Credit to triple-B-minus from triple-B, leaving a negative outlook. It affirmed the commercial paper ratings at F-2.

But, even as the ratings agency leaves Ford's investment-grade status intact for the time being, an imminent downgrade by another credit rater, Moody's Investors Service, looms over the auto giant.

Source : http://www.freep.com (7/21/2005)

GM tells CAW it can't afford increase in costs  
General Motors Corp. said Tuesday it doesn't want any increase in labor costs in its next contract with the Canadian Auto Workers and will ask the union to pay for wage increases by cutting other benefits. GM Canada Vice President Al Green said Canada's labor costs increased 5.7% each year under its last three-year CAW contract, and it can't afford those kinds of increases now. CAW President Buzz Hargrove said he is concerned about the health of GM and its U.S. market-share losses. But he said the company can't blame Canada; it houses some of GM's most productive factories and helps control health care costs with its national health system. On Tuesday, GM and the CAW began negotiating a new three-year contract with a brief handshake and a closed-door meeting.

Source : http://www.freep.com (7/20/2005)

Nissan Calling Back Murano  
Nissan Motor Co. Ltd. is calling back 125,466 Murano cross/utility vehicles due to a wiring problem that could lead to engine failure.

Muranos from the '03 to '05 model years are affected, says the National Highway Traffic Safety Admin.

A wire in the alternator may break, causing the battery to stop charging and the engine to shut down.

Source : http://wardsauto.com (7/21/2005)

PHH recommends Networkcar as industry standard for onboard telematics  
PHH Arval, a subsidiary of PHH Corporation reports positive results from clients beta testing PHH Onboard, its telematics-powered fleet service. The service is being developed in the US by combining PHH's consulting expertise and fleet data from PHH's data warehouse and Networkcar's wireless fleet management technology.

PHH says that from the dozen clients participating in the beta test, early results indicate that fleet telematics will dramatically lower fleet risk profiles, reduce maintenance and fuel costs, and improve productivity.

PHH Onboard, scheduled to be introduced to the general US fleet market this autumn, promises to deliver services in workforce productivity, risk management, and vehicle performance.

{HH says clients participating in the PHH Onboard beta test have experienced the following results:

- Virtual elimination of driving over company-established speed thresholds

- Dramatic reduction of vehicle idling at inappropriate levels

- Enhanced tracking of vehicles

- Elimination of unauthorized usage during non-work hours or at unauthorized locations

- Better understanding of vehicle usage, which results in a more ‘right-sized’ fleet

- 100% accurate odometer readings

Networkcar, a subsidiary of Reynolds and Reynolds, supports remote vehicle diagnostics, vehicle tracking and routing. PHH Arval and Reynolds and Reynolds announced a strategic alliance in 2004 to accelerate the deployment of onboard technology solutions to vehicle fleets. (www.networkcar.com/). PHH Arval is the second largest commercial fleet management company in North America, but also operates in Europe and the UK.

Source : http://www.autoindustry.co.uk (7/22/2005)

Reynolds and Reynolds reports quarterly revenues up 2%  
The Reynolds and Reynolds Company, the world’s biggest car dealer systems supplier, has reported third quarter results and announced it will no longer sell its Reynolds Generations Series Suite dealer management system launched in 2003, resulting in a charge in the company's fourth fiscal quarter.

Reynolds reported revenues of $247 million for the third fiscal quarter ended June 30, 2005, 2 per cent higher than a year ago. Net income was $24 million and earnings per share were 12 per cent higher than a year ago, including a 3 per cent benefit primarily from lower tax rates.

Revenues in the company's largest segment, Software Solutions, were $201 million, 3 per cent higher than a year ago. Documents segment revenues declined 3 per cent and revenues in the financial services segment declined 17 per cent, as a result of continued lower interest rates and a decline in the size of the receivables portfolio.

The discontinued Reynolds Generations Series Suite DMS software product had been installed in over US 70 dealership locations since its introduction in September 2003. As a result, in its fourth fiscal quarter ending September 30, 2005, the company will write off about $67 million of capitalized software development and may recognize additional costs in the fourth fiscal quarter.

Reynolds & Reynolds CEO Fin O’Neill said, "Suite captured the vision of what the dealer management system of the future should be. Unfortunately, we have concluded that Suite is not the broad-based solution for the majority of the U.S. automotive retail market that we originally believed. It requires substantial change in dealership processes to provide the desired utilization levels and benefits. Implementation and training costs are high for our customers and for Reynolds and Reynolds.”

The firm’s ERA DMS remains the leading broad-based DMS solution in the US auto retail industry and is used by over a half million dealership personnel at more than 10,000 dealership locations.

Outside the U.S. and Canada, Reynolds delivers the incadea DMS platform, which the company acquired in 2003. incadea now serves over 12,000 users at over 600 dealership locations in 27 countries. User franchises include: Alfa Romeo, BMW, Opel, Ford, Citroen, Peugeot, Renault, Mazda, Mercedes-Benz, Volvo, Fiat, Lada and Kia.

Source : http://www.autoindustry.co.uk (7/22/2005)

Project Kimber submits two alternative bids to MG Rover administrators  
The MG 'rescue team', Project Kimber, headed by David James CBE, says it put in two alternative unconditional bids to the joint administrators of MG Rover Group Limited and Powertrain Limited on Wednesday 20 July. One was for the MG brand, IPR, TF model production assets, TF supplier tooling and the means to contract build niche vehicles for third party car manufacturers.The other bid was for the above assets and also for the assets relating to Powertrain Limited.

David James believes that the combination of one or the other of these and another successful bid for the 'Rover' related assets, from a third party, will provide the optimum combination that will be in the best interests of the creditors.

Project Kimber will also offer to the joint administrators the free-of-charge services of its senior team to assist the sale of the assets, that are 'surplus' to Kimber's needs, to other parties around the world that have expressed an interest in such acquisitions. The Kimber team believes that these transactions can be completed ahead of the date of an alternative auction, in late October, that would result in much lower returns for the creditors.

Source : http://www.autoindustry.co.uk (7/22/2005)

Tenneco Automotive reports 'strong' second quarter operating results  
The US Tier 1 and aftermarket supplier has reported its 13th consecutive quarter of year-over-year revenue growth and its 14th consecutive quarter of year-over-year adjusted EBITDA improvement. Europe and South America EBIT were up 43% on revenue up 13%.

Tenneco Automotive reported second quarter net income of $33 million, up from $30 million a year ago. After adjustments for special items, second quarter net income rose to $35 million compared with $31 million in second quarter 2004.

EBIT was $83 million compared with $76 million a year ago. EBITDA (EBIT before depreciation and amortization) was $127 million, versus $120 million in second quarter 2004. On an adjusted basis, EBIT was $85 million, up from $84 million a year ago, and the company reported its 14th consecutive quarter of year- over-year improved adjusted EBITDA at $129 million, up from $128 million in second quarter 2004.

Despite a $65 million impact in the quarter from the discontinuation of GM’s advance payment programme, Tenneco’s operating cash inflow in the quarter was $28 million, versus $46 million in the second quarter of 2004. At quarter-end, the company’s total debt was $1.412 billion, down from $1.419 billion a year ago. Debt net of cash was $1.346 billion versus $1.253 billion a year ago, primarily due to the discontinuation of advance payment programs by General Motors, Ford and DaimlerChrysler, which had a $94 million impact on debt over the last 12 months.

Tenneco Automotive generated its 13th consecutive quarter of year-over- year revenue growth with revenue of $1.180 billion, compared with $1.113 billion a year ago. Favourable currency benefited revenue by $33 million. Total OE revenues were up 7% year on year, outpacing a 2% increase in global industry production, with continued gains from new OE business in Europe and more Japanese OE business in North America.

The company's gross margin in the quarter was 20.3%, down 1.3 percentage points from a year ago. Higher steel costs, restructuring charges and business mix offset savings and improved efficiencies from lean manufacturing, Six Sigma programmes and other cost reduction initiatives.

Tenneco’s total steel cost increases in the second quarter were $35 million, which were largely offset by the company's cost reduction efforts as well as steel cost recovery from OE and aftermarket customers. Based on the company's efforts to offset increased steel costs and trends in the steel market, the company doesn't currently anticipate a significant year-over-year impact on operating results through the remainder of 2005.

Source : http://www.autoindustry.co.uk (7/22/2005)

Valeo reports first half 2005 results  
Valeo's net sales reached €5,046 million in first half 2005, a year on year increase of 4.8%. After adjusting for exchange rates (+0.6%) and changes in the reporting entity (+5.4%, reflecting the acquisitions of the engine electronics division of Johnson Controls and the balance of the shareholding in Zexel Valeo Climate Control), sales were down 1.2% in line with vehicle production in Valeo's OE markets.

The gross margin for the half year fell by 2.7% to €825 million, representing 16.3% of sales as compared to €848 million and 17.6% of sales for the first half 2004. The group estimates that the increase in raw material prices reduced its gross margin by 1.5% before corrective actions.

Operating income was €153 millions or 3.0% of total operating revenues (defined as the sum of sales and other revenues - primarily the contribution of customers to research and development - as compared to €222 million and 4.6% of total operating revenues in the corresponding period of 2004. The operating income includes a charge of €48 million under "other income/expense" as compared to one of €25 million in 2004.

Income before tax for the period was €106 million as compared with €187 million in 2004. It includes a cost of financial debt of €24 million, an increase of €7 million compared to the first half 2004 as a result in particular of the acquisitions completed during the period.

Source : http://www.autoindustry.co.uk (7/22/2005)

Ford to Cut 250 Louisville Workers  
Ford Motor Co. reportedly will cut 250 workers from its Super Duty pickup truck plant in Louisville, KY.

The cut comes as the auto maker drops the Louisville-built Excursion SUV from its lineup in '06. The company will try to place the affected workers in other jobs and potentially try to achieve some of the reduction through retirement, a spokesman tells the Associated Press.

Source : http://wardsauto.com (7/21/2005)

Monaco Coach Corporation Announces Preliminary Second Quarter Results  
COBURG, Ore., -- Monaco Coach Corporation today announced preliminary results for the quarter ended July 2, 2005. The company estimates that second quarter revenues will be approximately $306 million. Earnings per share will be approximately 3 cents. Earnings include a one-time expense of approximately 5 cents per share as a result of relocating the Beaver Manufacturing facility. This compares to revenues of $358 million and earnings of 40 cents per share for the second quarter 2004.

Kay Toolson, Chairman and C.E.O. stated, "Our business faced many challenging conditions during the second quarter. Orders from dealers for recreational vehicles were tempered due to concerns about retail sales. There was significant discounting by manufactures, and lower run rates reduced plant efficiencies. Despite the overall difficult market conditions, our dealer meeting at the end of June was very upbeat. Our 2006 models and our Franchise for the Future initiative were both very well received."

In reaction to the softer than expected retail environment and to ensure the sale of 2005 model year products prior to the model year change over, a combination of discounts, retail incentives and other promotional activity was necessary.

The 2006 products were introduced at the dealer meeting at the end of June. The release of these products late in the quarter did not materially impact revenues. The Company has reported no discounting of 2006 products.

Monaco Coach Corporation has remained focused on establishing and maintaining production levels below the amount of retail sales. "Dealer inventory levels of our products have been reduced and are currently at an acceptable level," said John Nepute, President. "Our production run rate coupled with lower dealer inventory levels is consistent with our forecasts for the retail markets. This balance should reduce the need for wholesale discounting and additional sales promotional activities going forward."

Marty Daley, Chief Financial Officer said, "Start-up costs associated with Franchise for the Future, implementation costs related to information system upgrades and increased sales and dealer promotions led to higher SG&A costs in the second quarter as compared to the first quarter of this year."

Headquartered in Coburg, Oregon, with additional manufacturing facilities in Indiana, Monaco Coach Corporation employs more than 5,500 people and is one of the nation's leading manufacturers of recreational vehicles. The Company offers entry-level priced towable RVs up to custom made luxury recreational vehicle models under the Monaco, Holiday Rambler, Safari, Beaver and McKenzie brand names.

Source : http://www.theautochannel.com (7/21/2005)

VW says paid two mln eur to Andhra Pradesh  
FRANKFURT- Europe's largest carmaker Volkswagen paid nearly 2 million euros ($2.43 million) to Andhra Pradesh as compensation for misdealings related to an ongoing bribery scandal, it said on Thursday.

"Volkswagen...will hold those responsible accountable for the financial damages that have arisen," the company said in a statement.

Source : Reuters (7/21/2005)

BMW seeks India govt OK for $40 mln car plant  
BOMBAY (Reuters) - German luxury car maker BMW has sought permission from the Indian government to set up a $40 million manufacturing plant, the Business Line newspaper reported on Thursday.

The paper said the plant will be located in the town of Chengelpet in the southern state of Tamil Nadu, home to global car majors Ford Motor Co. and Korea's Hyundai Motor Co.

A proposal from BMW AG and BMW Holdings BV is awaiting clearance from the Foreign Investment Promotion Board, according to the Finance Ministry web site. It said the plant would assemble automobiles from knocked down kits, and import built-up units as well.

The Business Line said BMW, the world's largest premium car maker, would buy out its subsidiary, BMW India Pvt. Ltd., which it set up in 1997. BMW AG will buy 30 percent of the stake and BMW Holding will buy the remainder, the paper said.

The German company will also issue fresh shares to itself.

BMW makes the popular 3-series saloon, the Mini and the 1-series compact, besides the Rolls-Royce brand.

BMW's move comes even as German authorities are looking into charges by car maker Volkswagen that a former manager is guilty of fraud and betrayal of confidence over stalled plans to set up a plant in the state of Andhra Pradesh.

India, which had sales of 1 million cars last year, is seen as an important emerging market by American and European carmakers. European carmakers are troubled by nimble-footed Asian rivals, chronic overcapacity and uneven demand in major markets.

Ford, General Motors, Hyundai and Honda Motor Co. are all stepping up capacity in India to meet growing domestic demand and use it as an export base.

In February, France's Renault struck a joint venture with Mahindra & Mahindra to make the Logan sedan.

Source : Reuters (7/21/2005)

Arctic Cat Reports Record Sales in Fiscal 2006 First Quarter  
Arctic Cat Inc. today reported net sales of $107.9 million for the fiscal 2006 first quarter ended June 30, 2005, up 5 percent versus $102.6 million in the same period last year. Net earnings for the quarter rose to $448,000, or $0.02 per diluted share, compared to net earnings of $124,000, or $0.01 per diluted share, in the prior-year period.

"We are pleased to report another record first quarter," said Christopher A. Twomey, chairman and chief executive officer. "Sales increased across all product lines and exceeded our expectations, due to slightly higher than anticipated sales to dealers."

All-terrain vehicle (ATV) sales increased 6 percent to $41.4 million versus $39.2 million in the first quarter of last year. "Our dealers responded positively to our 2006 model ATVs unveiled at our dealer show in June," said Twomey. "We demonstrated further progress on our ATV growth strategy to extend our products into every market segment and to offer best-in-class ATVs at competitive prices. Notably, in just two years, we have completely redesigned our ATV lineup and expanded into new categories that offer opportunities to further increase our market share."

Among the new 2006 ATVs recently introduced was Arctic Cat's first entry into the true utility category with the Prowler. The Prowler's extensive features include side-by-side bucket seats with seat belts, and a composite rear-cargo box designed for hauling and dumping.

Sales of Arctic Cat snowmobiles rose 3 percent to $52.0 million compared to $50.7 million in the prior-year first quarter, due to slightly earlier sales to dealers. Parts, garments and accessories increased to $14.5 million versus $12.7 million in the year-ago period, fueled by sales across all product lines.

During the 2006 first quarter, Arctic Cat repurchased approximately 185,000 shares of its common stock under the company's $20 million share repurchase program.

Outlook

Arctic Cat currently anticipates fiscal 2006 second-quarter net sales for the period ending September 30, 2005, to range between $255 million and $267 million, up from $240.7 million for the same period last year. Net earnings for the quarter are estimated to be between $0.90 and $0.94 per diluted share versus earnings of $0.94 per diluted share in the prior-year quarter.

For the fiscal year ending March 31, 2006, Arctic Cat continues to anticipate that net sales will grow 3 percent to 5 percent and be in the range of $710 million to $723 million. The company is forecasting lower margins in fiscal 2006, due to increased raw material costs, lower snowmobile sales and a less favorable yen/dollar exchange rate, resulting in estimated full-year diluted earnings per share in the range of $1.31 to $1.40. Fiscal 2005 earnings per diluted share totaled $1.36.

"Our outlook for fiscal 2006 remains unchanged," said Twomey. "We continue to anticipate record full-year sales, but lower margins are expected to constrain earnings."

Conference Call

Arctic Cat will host a conference call to discuss the first-quarter results at 10:30 a.m. CT (11:30 a.m. ET) on Thursday, July 21. To listen to the live Webcast or replay of this call via the Internet, go to the corporate portion of the company's Web site at www.arcticcat.com, and click on the conference call icon. A telephone replay also will be available from approximately 12:30 p.m. CT on Thursday, July 21, until 6 p.m. CT on Thursday, July 28. To access the telephone replay, dial (800) 405-2236, conference ID #11034943.

Source : http://www.theautochannel.com (7/21/2005)

Seat belt prompts recall  
Toyota Motor Co. said Wednesday it would recall 345,000 Sienna minivans because the seat belt in some seating positions might become difficult to retract when unbuckled.

The company said there was a possibility the shoulder portion of the seat belt in the middle row seats might get stuck in a plastic piece that the belt glides through, binding it up and making it difficult to put on or take off, said spokeswoman Allison Takahashi.

The voluntary recall in the United States involves Siennas from the 2004 and 2005 model years. The company had received 14 complaints but there have been no accidents or injuries from the problem, Takahashi said.

Source : http://www.freep.com (7/21/2005)

Toyota Recalls Sienna, Tundra  
Toyota Motor Corp. is staging a recall of 345,443 '04-'05 Sienna minivans due to faulty seatbelts.

The auto maker says the shoulder portion of the seatbelts in Sienna's middle row seats may bind in the seatbelt bezel of the right-side captain's chair in 7-passenger models. The shoulder belt in the center seat of the 8-passenger model's second-row bench also is affected.

Toyota advises owners to make sure the belt is not binding in those seating positions. If it is, they can pull the seatbelt outward and let it retract until the vehicle is fixed at the dealership.

Meanwhile, a recall is under way involving approximately 2,500 Tundra Access Cab compact pickup trucks in the U.S. due to a faulty indicator light in mid-'05 models.

The light is used to disclose the status of the front airbag in the trucks. Toyota says a small number of Tundras, equipped with optional front captain's chairs, may have the wrong indicator light lens.

Source : http://wardsauto.com (7/21/2005)

AAA Chicago Says Fuel Prices Rise Sharply Since Mid-June  
The statewide average for gasoline in Illinois and Northern Indiana has gone up since this time last month. AAA Chicago's most recent Fuel Gauge Report estimates that for July 2005, Illinois motorists will pay an average of $2.36 per gallon for regular unleaded gasoline. That's up 22 cents from last month and 42 cents higher than gas prices for this time last year. In northern Indiana, gas prices now average $2.26, which is up 18 cents from June and up 38 cents from July 2004.

"Hurricanes Dennis and Emily were a factor in the price increase because production and shipping along the Gulf coast were reduced before and during the storms," says Kris Lathan, spokeswoman for AAA Chicago. "The cost of crude oil has also increased during the past month which is reflected in the price at the pump."

-- In Cook County, Ill. self-serve regular unleaded gasoline averages $2.48, which is up 24 cents compared to last month and 44 cents higher than last year's price-per-gallon.
-- In DuPage County, Ill. self-serve regular unleaded gasoline averages $2.39 per gallon, which is a 26-cent increase from June and 44 cents higher than last year.
-- In Kane County, Ill. self-serve regular unleaded gasoline averages $2.37 per gallon, which is up 23 cents compared to last month and 43 cents higher than July 2004's price.
-- In Lake County, Ill. self-serve regular unleaded gasoline averages $2.38 per gallon, which is up 25 cents in the last month and up by 42 cents compared to this time last year.
-- In McHenry County, Ill. self-serve regular unleaded gasoline averages $2.39 per gallon, which up 23 cents from June's average and 46 cents higher than July 2004's price.
-- In Will County, Ill. self-serve regular unleaded gasoline averages $2.34 per gallon, which is 22 cents higher compared to last month and 41 cents higher compared to last year.
-- In Allen County, Ind. self-serve regular unleaded gasoline averages $2.30 per gallon, which is an increase of 18 cents from last month and 43 cents higher than July 2004's price.
-- In Lake County, Ind. self-serve regular unleaded gasoline averages $2.30 per gallon, a 19 cent increase from June's average and a 43 cent increase from a year ago.
-- In St. Joseph County, Ind. self-serve regular unleaded gasoline averages $2.27 per gallon, which is up 17 cents compared to last month and an increase of 41 cents from July 2004.

For more than 100 years, AAA has represented the interests of the nation's motorists and served as an advocate for various traffic safety and travel related issues. AAA Chicago has served that role in Illinois since its founding in 1906.

Source : http://www.theautochannel.com (7/21/2005)

VW pays Andhra Pradesh 2 mln euros  
FRANKFURT - Volkswagen paid nearly 2 million euros ($2.43 million) to the state of Andhra Pradesh as compensation for misdealings linked to a bribery scandal, Europe's largest carmaker said on Thursday.

"Volkswagen ... will hold those responsible accountable for the financial damages that have arisen," the company said in a statement, adding that it would enlist the support of officials from the Indian state.

VW said that Helmuth Schuster, a former personnel chief at its Czech unit Skoda who is under investigation by German prosecutors, had cheated Andhra Pradesh out of the money.

VW said Schuster had arranged for the state to transfer the sum of roughly 2 million euros to a firm called Vashishta Wahan, which VW created as a special company to set up an assembly plant in India if and when it decided to proceed with such a project.

VW said it had never held a stake in the firm, however, and had never given the go-ahead for the project.

"Schuster acted without authorisation and deceived the state of Andhra Pradesh," it said.

Schuster's lawyer Ferdinand Gillmeister could not be reached for comment, but news magazine Der Spiegel quoted him as saying that VW was always informed about Schuster's talks with Andhra Pradesh, and that the carmaker had insisted that the Indian partners would fund the start-up costs of the venture.

VW said it remained interested in principle in entering the Indian market, where at present it only assembles Skoda Octavia compacts and Superb mid-size models from kits in Aurangabad.

Shares in Volkswagen closed 2 percent higher at 42.40 euros, easily outperforming a 0.5 percent rise by its European peers in the DJ Stoxx auto sector index.

Source : Reuters (7/21/2005)

Skoda to launch new model  
Skoda Auto India, subsidiary of Czech major Skoda Auto, plans to launch a new model and a diesel version of an existing one shortly.

Imran Hassen, managing director, Skoda India, said the company would launch the Octavia Kombi within a month and the Superb Diesel V6 by October.

Both the cars will be priced at a premium to the company’s existing Octavia and Superb brands. The company also has plans to launch a car codenamed A5 by the next year.

Seeing a huge potential for niche cars in the country, the company plans to expand its capacity every year.

“By 2008, Skoda India has plans to bring out 50,000 cars per year. The company also sees opportunity to use India as a hub to export cars to neighbouring countries such as Bangladesh, Nepal, Sri Lanka and Pakistan,” said Hassen. The company produces nearly 7,000 cars a year.

India would also be utilised as a base by parent Skoda for providing software- and technology-related solution to global auto companies. The company is keen to outsource components and accessories from India, he said.

Skoda India, during the last four years of its operations in the country, has sold 21,000 cars in the country. It is currently doubling its capacity to 30,000 cars per year from the current 15,000, which will be achieved by November, 2005.

Skoda India sold 801 cars in June, which is 31.3 per cent year-on-year increase compared with a sale of 610 cars in June 2004.

After the opening of the company’s dealership network at Vashi in Navi Mumbai, the company’s total number of dealership in the country has reached 38.

SkodaAuto India has ten luxury models, such as SkodaSuperb, SkodaL&K, SkodaRS, SkodaElegance 1.9 TDI, SkodaElegance 2.0 MPI, SkodaElegance Automatic, SkodaRider 1.9 TDI, SkodaRider 1.8 Turbo, Skodarider 2.0 MPI and SkodaRider Automatic, available in the country.

Source : Business Standard (Online Edition) (7/22/2005)

Maharashtra Agro joins hands with L&T-John Deere  
L&T-John Deere Pvt Ltd, tractor manufacturer, has signed a memorandum of understanding with the Maharashtra Agro Industries Development Corporation Ltd, manufacturer of rotary tillers under the brand Krushivators - for joint promotion and marketing of the products.

Mr J.P. Banerjee, Vice-President, Business Development LTJDPL, said the alliance would widen and deepen the company's offerings to farmers and provide them with easier access to superior tools for cultivation.

Dr Pradeep Vyas, Managing Director, MAIDCL, said the Krushivator tiller would supplement the efficiency of the tractor in several operations such as ploughing, clod crushing, harrowing and levelling, thereby reducing cost and time of land preparation and save fuel.

LTJDPL manufactures tractors in the range of 35 hp to 70 hp at its factory at Sanaswadi, Pune. Over 50 per cent of the production is exported to the US, Turkey, Mexico and South-East Asian countries.

MAIDCL is a Government of Maharashtra undertaking with a turnover of over Rs 350 crore. Krushivators have been widely accepted by farmers in Maharashtra and other States, and are available in a range of 0.75 m to 2 m suitable for tractors of 35 hp to 70 hp, Mr Banerjee added.

TVS Star sales cross 1-lakh mark  
VISAKHAPATNAM: TVS Motor Company has sold more than a lakh vehicles of its new two-wheeler model, Star, across the country, in over five months' time since its launch, according to Mr D. Dilip, General Manager (Sales).

He was speaking at a press meet to mark the company selling more than 1,000 Star vehicles in Visakhapatnam.A star nite was organised on the occasion.

Mr Dilip said the economy segment was witnessing 30 per cent growth consistently and the trend would continue during the rest of the year. He said the company had a 20 per cent share in the two-wheeler market in the State and the country. "Ruggedness and high mileage (95 km) are the features of the vehicle. It is competitively priced at Rs 32,650,'' he added. The company planned to introduce more models this year, he said.

Source : Business Line (Online Edition) (7/22/2005)

MRF declares 30% interim dividend  
MRF Ltd has informed BSE that the BoD of the company at its meeting held on July 21, 2005, have declared 30 per cent interim dividend on the paid-up capital of the company.

Source : sify.com (7/21/2005)

AP seeks appointment with Volkswagen CEO  
Hyderabad: The Andhra Pradesh Government has initiated efforts through the Indian Embassy in Germany to set up an appointment for its official delegation to meet Volkswagen's Chief Executive Officer, Bernd Pischetsrieder.

The meeting is intended to sort out the controversy over the German carmaker's proposed project in Visakhapatnam.

The AP Principal Secretary has already written to the Volkswagen CEO on Tuesday seeking his appointment for detailed discussions. This follows an invitation from Alfred Strohlein, Head (legal and projects), Volkswagen, on July 13.

Simultaneously, the Government is also pursuing legal options, pertaining to the siphoning of Rs 11.5 crore. It is already under a cloud for releasing the funds as its equity contribution to Vasishta Wahan , a Special Purpose Vehicle. The subsidiary was created at the behest of Dr Helmut Schuster, the former India Project Head of Volkswagen, through Skoda.

The State delegation's agenda primarily includes urging and ensuring that the German automobile giant sets up its Rs 6,000-crore manufacturing facility at Visakhapatnam as promised by Dr Schuster, according to official sources.

Meanwhile, the State Enforcement Department officials have began the process of gathering details pertaining to the persons involved in the episode so as to be handed over to the CBI, which has been entrusted with the investigation by the State Government.

The State Finance Minister, K. Rosaiah, told newspersons today that the Government would not like to comment on the issue since the CBI would now probe the matter.

Source : sify.com (7/21/2005)

Dana profits halved  
Auto-parts maker Dana Corp. reported its second-quarter profits were cut in half, mainly due to a gain it recorded a year ago when it sold its automotive aftermarket business.

The Toledo-based company earned $51 million, or 34 cents per share, in the quarter ended June 30, compared with $110 million, or 73 cents per share, for the same period a year ago.

Excluding one-time items, the company's earnings from continuing operations came to $53 million, or 35 cents per share, compared with $59 million, or 39 cents per share, last year.

Source : http://www.freep.com (7/21/2005)

New plant in Alabama builds Sonata  
The all-new 2006 Sonata is the first vehicle to roll out of Hyundai's new sprawling $1.1-billion manufacturing complex in Montgomery, Ala.

The plant will add production of Hyundai's all-new, larger seven-seat Santa Fe SUV over the next year.

The massive plant is vital to the South Korean automaker's strategy to move upscale and gain more affluent buyers who will pay higher prices for the bigger new cars and midsize SUVs it will build

Source : http://www.freep.com (7/21/2005)

New plant in Alabama builds Sonata  
The all-new 2006 Sonata is the first vehicle to roll out of Hyundai's new sprawling $1.1-billion manufacturing complex in Montgomery, Ala.

The plant will add production of Hyundai's all-new, larger seven-seat Santa Fe SUV over the next year.

The massive plant is vital to the South Korean automaker's strategy to move upscale and gain more affluent buyers who will pay higher prices for the bigger new cars and midsize SUVs it will build

Source : http://www.freep.com (7/21/2005)

AMD Sponsors the North American Solar Challenge  
AMD today announced that it is sponsoring the 2005 North American Solar Challenge (NASC), a competition to design, build and race solar-powered cars across the United States and Canada. Twenty teams of university students from around the world are competing in the 2,500-mile race that started in Austin, Texas on July 17, and will end in Calgary, Alberta on July 27.

As a sponsor, AMD provided the NASC race organizers with five HP Pavilion ze2000z notebook PCs powered by AMD Turion(TM) 64 mobile technology, a world-class mobile processor. Designed to bring award-winning AMD64 performance to thinner and lighter notebook PCs, AMD Turion 64 mobile technology offers extended system battery life, enhanced security, and compatibility with the latest graphics and wireless solutions. In many ways, the features and benefits of AMD's state-of-the-art mobile technology are representative of the race's goal to further the development of engineering excellence and energy-efficient technology. "AMD's sponsorship of the North American Solar Challenge is an ideal fit with our commitment to delivering mobile performance without compromise," said Chris Cloran, director of the Mobile Division for AMD's Microprocessor Solutions Sector. "AMD Turion 64 mobile technology allows notebook PC manufacturers to offer new levels of performance and differentiation to break free from the competition." NASC race organizers are using the high-performance HP Pavilion ze2000z notebooks powered by AMD Turion 64 mobile technology throughout the race to record vital information about the participating teams and their vehicles. "We are excited to have AMD as a sponsor for this year's North American Solar Challenge," said Dan Eberle, director for the North American Solar Challenge. "From tracking critical vehicle safety information prior to the start of the race to recording each team's location during the race, AMD's technology has been an integral component in helping us run a successful competition." Race organizers used the technology during pre-race trials to record hundreds of data points for each vehicle, including safety and inspection information as well as time trial results. Throughout the race, AMD Turion 64 mobile technology provides the performance needed to enable the mapping and data collection software running on each notebook. This technology allows race organizers to track real-time GPS coordinates of the competing cars, as well as gather information about each team's race time and penalties. Source : http://www.theautochannel.com (7/21/2005)

New roadsters to hit dealers in August  
Pontiac will begin shipping its new 2006 Solstice roadster to dealers the first week of August, division general manager John Larson told reporters in Portland, Ore., on Tuesday night. Pontiac expects to deliver several hundred Solstices to dealers that month. All of those will go to buyers who paid deposits on the car during its debut on the NBC reality show "The Apprentice" in April. In addition, Pontiac dealers have taken cash deposits from about 9,100 other buyers. General Motors Corp. expects to build as many as 1,500 Solstices a month when its Wilmington, Del., plant reaches capacity.

Source : http://www.freep.com (7/20/2005)

Ford, Canadian Auto Workers Begin Talks  
The Canadian Auto Workers union and Ford Motor Co. began contract talks on a subdued note Wednesday, with union leaders saying Ford is clearly the weakest of the Big Three automakers in this round of negotiations.

"Overall, the operations are very, very soft," said CAW President Buzz Hargrove.

Hargrove said weak sales of Ford's Freestar minivan led to layoffs at Ford's largest Canadian plant, in Oakville, Ontario, and other Canadian plants aren't producing at their full capacity.

Ford employs about 12,000 hourly workers in Canada, down from nearly 13,000 in 2002, when Ford negotiated its last contract with the CAW. Ford also has about 12,000 retirees in Canada.

Stacey Allerton Firth, Ford's chief negotiator in Canada, said that as the Canadian dollar gets stronger there is less advantage to building vehicles there. Canada already has the second-highest labor costs - after the United States - of any country Ford operates in, Firth said. The base salary for a Ford assembly worker in Canada is about $24.43.

"The Canadian industry is part of a global marketplace competing with countries that weren't even considered serious players 10 years ago," Firth said.

Firth wouldn't say what Ford is seeking in the new contract, although she did say that the increase in labor costs in the last contract "isn't sustainable over the long haul." Ford's labor costs - including health care and other benefits - rose 5 percent in each of the last three years, Firth said.

"We're looking for a competitive, sustainable settlement," she said.

Firth added that Ford's recent commitment of nearly $1 billion in improvements to the Oakville plant shows that it is committed to boosting its Canadian operations.

Ford doesn't reveal profits for Canada, but CAW economist Jim Stanford said Ford may not have made a profit in the country last year. On Tuesday, Ford reported a second-quarter profit of $946 million, but said its North American operations lost $907 million.

Hargrove said the CAW is aware of Ford's difficulties and will keep them in mind as the union negotiates a contract that will eventually be adopted by all three automakers. Ford was the second of the Big Three U.S. automakers to start negotiating a new three-year contract with the CAW this week. General Motors Corp. began talks Tuesday and DaimlerChrysler AG was scheduled to start Thursday. The automakers' contracts with the CAW expire Sept. 20.

"I do want to stress that our relationship with Ford Motor Company has historically been the best of the three companies. We've always been able to work out an agreement with Ford in the most difficult situations," Hargrove said.

"We hope to continue, (but) given the issues that face us, given the position that Ford's in, it's going to be a real challenge as to whether or not we can keep that relationship intact."

The mood was far different from Tuesday, when GM Canada vice president Al Green said the world's largest automaker doesn't want to see any increase in its labor costs. Green said GM will ask the CAW to offset wage increases with cuts in other benefits.

Hargrove estimated GM Canada made $500 million in profit last year and said GM's plants in Canada were some of the most productive in the world.

GM would be "in a lot worse condition if it wasn't for the contributions that the CAW makes," Hargrove said. GM announced Wednesday it lost $286 million in the second quarter, dragged down by a $1.2 billion loss in North America.

The CAW plans preliminary negotiations with the three companies until Labor Day. After that, it will choose a target company to negotiate a master agreement that is expected to be adopted by all three companies.

The talks offer a preview of what's to come in the United States in 2007, when the United Auto Workers' contracts with the Big Three expire.

Ford shares rose 9 cents to close at $10.93 Wednesday on the New York Stock Exchange, while GM shares fell 25 cents to close at $36.58.

Source : http://www.forbes.com (7/22/2005)

"Maryland Law Enforcement Crack Down on Aggressive Driving  
With temperatures rising and summer now in full force, law enforcement officials with the Smooth Operator program continue their commitment to combating aggressive driving during the summer months. In conjunction with the Maryland Public Safety Driver Training Facility, local media were invited this morning to witness aggressive driving behaviors and experience what it feels like to be in a car traveling at high speeds, weaving between lanes and running red lights.

The Maryland Public Safety Training Center's Driver Training Facility in Sykesville, Maryland, trains officers to look out for the aggressive driving behaviors that make the roads dangerous. The facility offers both a highway and urban driving course, designed to reduce the incidence of police involved in motor vehicle collisions, the resulting operational costs, and most significantly deaths and personal injuries of police officers and citizens. This facility trains 20 percent of Maryland law enforcement officers each year. The Training Center also volunteered their facility for a Smooth Operator-sponsored police video on aggressive driving behaviors. The Smooth Operator - A Law Enforcement Response to Aggressive Driving video will to continue to put vitality into the program by reeducating officers who are out in the field to put an end to these dangerous driving behaviors.

Summer means more children playing outdoors, away from the protection of a school classroom, an influx of tourists crowding the sidewalks and construction activities ramping up and slowing down traffic. The hot days of summer often leads to hot-headed driving with a dramatic increase in aggressive driving, speeding injuries and fatalities during the summer months - especially July. Coupled with the fact that Baltimore is among the top 20 most congested regions in the country, the summer months can be a very dangerous time on the roads.

Summer is also the season of highway construction entailing lane shifts, shoulder closures, temporary detours and unexpected slowdowns. In Maryland, traffic-affecting work continues on the Baltimore beltway and the Route 29 expansion. Additionally, this summer's construction impacts on both the Maryland and Virginia side of the Woodrow Wilson Bridge are expected to be the most severe of the 11-year construction project. Law enforcement will be heavy through work zones so drivers need to keep their cool.

The Smooth Operator campaign includes a public education and awareness campaign that runs simultaneously with four separate law enforcement waves, with the 3rd wave beginning Sunday, July 24th and running till July 30th. The fourth wave will run August 28- September 10, 2005. The first wave from May 22-28, 2005 proved to be very successful with 55,189 citations and warnings written for various driving violations, including speeding, running red lights, and non-compliance with safety belt laws. The second wave was also successful 71,717 citations and warnings. During the waves, more than 80 participating law enforcement agencies in the District of Columbia, Maryland and Northern Virginia look out for aggressive driving behaviors, including speeding, tailgating, running red light and stop signs, improper passing and other dangerous driving maneuvers. Last year alone, citations during four enforcement waves totaled more than 260,000 - a fourfold increase from the 62,000 issued in the initial year.

Source : http://www.theautochannel.com (7/21/2005)

Valeo 2005 First Half Results  
In the second quarter, the Group met its objective of having internal sales growth above that of automobile production in its reference markets. The margins have improved since the beginning of the year, but remain impacted by raw material prices and the pressure on prices. The increased debt levels resulting from the acquisitions, the public tender offer and the dividend payment, remain compatible with the financial stability of the Group and its development objectives.

2005 first half Group results

Valeo's net sales reached 5,046 million euros in the first half 2005, an increase of 4.8% compared to the first half 2004. After adjusting for exchange rates (+0.6%) and changes in the reporting entity (+5.4% reflecting the acquisitions of the engine electronics division of Johnson Controls and the balance of the shareholding in Zexel Valeo Climate Control), sales were down 1.2% in line with the automobile production in Valeo's reference markets.

The gross margin for the half year fell by 2.7% to 825 million euros, representing 16.3% of sales as compared to 848 million euros and 17.6% of sales for the first half 2004. The Group estimates that the increase in raw material prices reduced the gross margin was 1.5 points before corrective actions.

Operating income was 153 millions euros or 3.0% of total operating revenues (defined as the sum of sales and other revenues - primarily the contribution of customers to research and development - as compared to 222 million euros and 4.6% of total operating revenues in the corresponding period of 2004. The operating income includes a charge of 48 million euros under "other income/expense" as compared to a charge of 25 million euros in 2004.

Income before tax for the period was 106 million euros as compared with 187 million euros in 2004. It includes a cost of financial debt of 24 million euros, an increase of 7 million euros compared to the first half 2004 as a result in particular of the acquisitions completed during the period.

The tax charge was 35 million euros as compared to 1 million euros in the first half 2004. The first half 2004 tax charge included a rebate of 83 million euros corresponding to the outstanding balance for the tax paid in 2001 on the gain from the sale of the Group's 50% shareholding in LuK.

Net income was 73 million euros for the period compared to 183 million euros for the first half 2004. The comparison between the two years was impacted by the tax rebate of 83 million euros in 2004.

Net cash from operating activities reached 392 million euros as compared to 429 million euros adjusted for the tax rebate of 83 million euros in the first half 2004. After taking into account capital expenditure in property and intangibles, dividends paid and grants and contributions received, the free cash flow was 101 million euros as compared to 175 million euros (adjusted for the exceptional tax rebate) in the first half 2004.

At 30 June 2005, Valeo's net financial indebtedness was 1,263 million euros as compared to 500 million euros on 1 January 2005. The change reflects in particular the acquisitions of the engine electronics division of Johnson Controls (327 million euros) and of the remaining shares of Zexel Valeo Climate Control and Valeo Zexel China Climate Control (104 million euros). The increase in the debt levels also reflects 251 million euros related to the share buyback program. As a result of these operations in particular, and the share reduction following the share buyback program, the debt to equity ratio is 73% as compared to 26% on 1 January 2005.

The order intake for the half was 1.2 times sales.

Outlook

For the second half of the year, the Group foresees a drop of between 1% and 2% in light vehicle production in Europe and a slight increase in North America boosted by the growth of the transplants. Valeo intends to continue to increase its market share, in line with the trend initiated from the first quarter 2004. The Group also intends to benefit from growth opportunities following its recent acquisitions.

Valeo is an independent industrial Group fully focused on the design, production and sale of components, integrated systems and modules for cars and trucks. Valeo ranks among the world's top automotive suppliers. The Group has 130 plants, 68 R&D centres, 9 distribution centres and employs 72,100 people in 28 countries worldwide.

Source : http://www.theautochannel.com (7/21/2005)

Companies 'putting lives at risk' with cash for car schemes  
Leasing firm Masterlease has renewed its call for a zero-tolerance approach to ‘Cash for Car’ Schemes (CFCs) after an NOP World Automotive survey that it contributed to revealed a ‘worrying’ level of employees who had opted out of company car schemes, leaving, Masterlease claims, fleet managers with no way of checking the safety and suitability of the vehicles they now use for business.

The survey sampled more than 1,000 drivers eligible for company vehicles under their contracts of employment. Around one quarter of business drivers on the road had opted out of company schemes where maintenance and servicing come as standard. Almost 40 per cent of these did so between 2002 and 2004 after the introduction of tax changes that led to companies giving cash support for employees wishing to avoid company car tax.

The figures from the survey provide a profile of an existing opt-out driver. The survey says 72 per cent of ‘opt out’ drivers would choose specialist vehicles with larger, more polluting engines as their next car compared to 54 per cent of executive car drivers who remain in company schemes. Only 20 per cent of companies surveyed imposed any restrictions on opt out cars.

Over 50% of existing opt out drivers chose second-hand cars and, of this figure, 22 per cent went for used cars over three years old, statistics that Masterlease argues set a worrying trend in terms of a company’s duty of care.

“Companies should simply say ‘no’ to employees who want to use their own vehicles for business unless the business has in place rigorous tests to examine the cars’ suitability and road-worthiness, especially as the Government is going to crack down hard on those businesses that flaunt the duty of care regulations under its proposed corporate manslaughter legislation,” says Masterlease managing director Garry Hobson.

Source : http://www.autoindustry.co.uk (7/22/2005)

Adblue means changes to fuel management systems for fleets  
The introduction of Adblue with the 2008 Euro 5 truck emissions standards will mean a raft of fuel management changes for fleets, says fleet software firm cfc solutions, suggesting that truck fleets will need to modify software and paper-based systems designed to track buying and usage of Adblue in order to ensure that vehicles remain compliant and no fuel abuse occurs.

Sales and marketing director at cfc, Andy Leech, said: "Because Adblue is relatively cheap and, as far as we know, is unlikely to be used in passenger cars for a while, there should be little fuel theft, but its usage and expenditure must still be tracked as part of the same management good practice used for diesel.

"Also, depending on the filling system used, there may be a problem with drivers simply forgetting or neglecting to fill the Adblue tank, or even unscrupulous operators topping the Adblue tank up with water. However, the extent of this is difficult to predict."

cfc is working on making its own fleet software systems ‘Adblue-friendly’ in advance of 2008.

Source : http://www.autoindustry.co.uk (7/22/2005)

Avon Rubber plans £2.5m management cost savings  
Avon Rubber plc plans to save £2.5m by reducing central management numbers and eliminationg its present divisional structure, reports autowired.co.uk.

Lee Richards will continue to head Avon Rubber’s automotive business, although he will no longer be a board director, but all Avon Rubber’s other businesses will report to Jonty Palmer. both Palmer and Richards will report to Terry Stead, the chief executive designate. Mr Peter Slabbert was recently appointed as the group’s new finance director. Present chief executive Steve Willcox, the former chief executive, is retiring at the end of September.

There will be a one-off exceptional charge of about £1m in order to implement the reorganisation.

Separately, Avon Rubber has announced this week its purchase of ISI, a US breathing apparatus manufacturer, for €20.7m in cash, from Avon Rubber’s own resources.

Source : http://www.autoindustry.co.uk (7/22/2005)

Getz gets a new face  
Hyundai has unveiled a face-lifted version of its Getz supermini in Korea, but the car will not reach the UK until 2006.

Known as the Click in Korea, the updated car gets a new grille, revamped lights and remodelled bumpers. New options will include active head restraints, which move forward in an accident to minimise whiplash injuries, and steering wheel-mounted controls for the stereo.

Hyundai UK has yet to confirm full details of the car, but a Korean press release reveals that a new 94bhp 1.4-litre petrol engine will replace the current 82bhp 1.3-litre, and will improve on its 49.6mpg fuel consumption figure.

Source : http://www.whatcar.co.uk/News_Article.asp?NA_ID=216239 (7/21/2005)

Motor Trader Franchise Barometer shows FSA compliance remains problematical  
According to the latest Motor Trader Franchise Barometer, sponsored by Aon Warranty Group, 35 per cent of dealers surveyed said they were “not confident” that staff were complying consistently with the requirements of FSA. Motor Trader notes that this figure equates to an average of 2,100 dealers currently operating in the UK.

Dealers selling insurance products including warranties and credit insurance were required, as were other insurance intermediaries, to be FSA-authorised from 14 January this year. The FSA is currently arranging spot inspections of newly-authorised intermediaries.

Source : http://www.autoindustry.co.uk (7/22/2005)

BIO Praises New Plan to Spur Commercialization of Biofuels  
A new report shows that America can produce 25 percent of its transportation fuel needs from agricultural crop wastes -- utilizing new processes developed by the biotechnology industry -- while reducing carbon and greenhouse gas emissions. 'Bringing Biofuels to the Pump,' from the National Resources Defense Council, recommends that the United States invest $1 billion over the next 10 years in bioethanol commercialization to "drive the development of the first billion gallons of bioethanol capacity at a price approaching that of gasoline and diesel." The Biotechnology Industry Organization supports that recommendation and agrees with the NRDC that development of cellulosic biofuel is economically and strategically vital to helping end America's dependence on imported oil.

"The Senate version of the energy bill [HR 6] currently in conference committee contains an 8 billion gallon renewable fuel standard and establishes a reverse auction for the production of the first billion gallons of ethanol made from cellulose-containing crop wastes," said Brent Erickson, BIO Executive Vice President of Industrial and Environmental Biotechnology. "We could be producing up to 25 percent of our transportation fuel needs in the not-too-distant future by combining biotechnology and agriculture to produce bioethanol, and this energy bill will be a big stimulus to help us meet that goal," he added.

The report recommends that the federal government establish a mix of incentives -- including loan guarantees, tax-exempt financing and performance incentives -- to aid ethanol researchers and producers at each step in bringing cellulosic biofuels to market. The NRDC also recommends capping the total amount of incentives at $1 billion over 10 years, to ensure that the industry becomes self-supporting and economically viable. As technology advances in the next 10 years, these incentives will lower the costs of cellulosic biofuel production to "about $0.93 per gallon -- roughly equivalent to the current wholesale price of both gasoline and ethanol from new corn- based facilities," the NRDC predicts.

Biofuels have been shown to reduce emissions of greenhouse gases. The "Bringing Biofuels to the Pump" report contends that use of cellulosic biofuels can reduce greenhouse gas emissions by 1.7 billion tons per year. The NRDC therefore recommends that renewable fuel standards, such as that contained in the Energy Bill recently passed by the House and Senate, establish a cellulosic ethanol blending requirement that would reach 1 billion gallons by 2015.

The report is available on BIO's web site at http://www.bio.org/ind/.

BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and 31 other nations. BIO members are involved in the research and development of healthcare, agricultural, industrial and environmental biotechnology products.

Source : http://www.theautochannel.com (7/21/2005)

Edmunds.com Says Hyundai Sonata Beats Toyota Camry and Honda Accord in a Mid-Size Comparison Test  
The all-new 2006 Hyundai Sonata beat Honda Accord and Toyota Camry, its primary competitors in the mid-size sedan segment, and took first place in an Edmunds.com Inside Line comparison test yesterday. Edmunds.com reported, "In the end, it wasn't even close ... in the areas of performance and features, the Hyundai won in a landslide ... Bottom Line: With the 2006 Sonata, Hyundai convincingly beats the long-standing class leaders in nearly every important category." Edmunds.com is a leading automotive Web site providing consumers with valuable information on the industry's top vehicles. To read the full review, go HERE.

"We were looking for the family sedan priced under $22,000 with the best combination of passenger accommodations, safety and luxury features, performance, overall quality and value," said John DiPietro, Road Test Editor at Edmunds.com Inside Line. "Taking all of these factors into account, the Hyundai Sonata came out on top."

2006 Sonatas began rolling off the assembly line of Hyundai's new manufacturing plant in Montgomery, Ala., in April. The all-new Sonata was designed specifically to meet the needs of the American consumer and is the product of three years of intensive collaborative development at Hyundai's global R&D operations, including those in Michigan and California. It is the first and only mid-size sedan sold in America to offer one of the industry's most effective and sophisticated safety technologies, Electronic Stability Control, as standard equipment.

Edmunds.com praised the all-new Sonata for its roomy interior (classified by the U.S. government as a "large car," a full class above Camry and Accord), smooth V6 engine, segment-leading standard safety technology, and strong value. "In the real world, the Sonata shines. The well-tuned suspension smothers the bumps and keeps its composure in turns without drama, and its tuning falls between the firm Accord and cushy Camry. There's plenty of power for effortless merging and passing, and the brakes are a strong ally in the daily grind. And let's not forget the standard stability control, unusual in the segment, and the huge 10-year/100,000-mile powertrain warranty."

Edmunds.com concluded, "With the Sonata handily dethroning the twin kings of the family sedan segment, Hyundai has shown that, beyond a doubt, it's ready to take a starring role on the automotive stage. Nice job, Hyundai."

Hyundai Motor America, headquartered in Fountain Valley, Calif. is a subsidiary of Hyundai Motor Company of Korea. Hyundai cars and sport utility vehicles are distributed throughout the United States by Hyundai Motor America and are sold and serviced by more than 665 Hyundai dealerships nationwide.

Source : http://www.theautochannel.com (7/21/2005)

Vintage Automobile Races Celebrate and Preserve Racing History  
MONTEREY, Calif., -- Hundreds of vintage automobiles, most with racing pedigrees and several with famous drivers, will participate in two of the nation's premier vintage automobile races -- the 32nd Rolex Monterey Historic Automobile Races Presented by Chrysler (August 19-21 at Mazda Raceway Laguna Seca on California's beautiful Monterey Peninsula), and the Rolex Vintage Festival Presented by BMW (September 2-5 at historic Lime Rock Park in Lakeville, Connecticut).

Each year, the Rolex Monterey Historic and the Rolex Vintage Festival attract thousands of visitors for highly competitive races featuring vintage racecars spanning eight decades (1900s to the 1980s). A "Who's Who" of manufacturers from Alfa Romeo, Aston Martin, Bentley, BMW, Chaparral, Ferrari, Jaguar, Maserati, MG, Porsche, Shelby and more are represented.

"The concept of the Rolex Monterey Historic and the Rolex Vintage Festival is to focus on the history of motor racing by encouraging the preservation of racecars, and putting them on display for enthusiasts of all generations to see and enjoy," said Steven J. Earle, president of General Racing Ltd. and organizer of the events. "Visitors to both events are treated to a steady presentation of the most famous cars in racing history, along with the personalities who designed, built and drove them."

Both event's "Featured Marque" and "Special Tribute" programs honor automakers and auto racing legends that have played pivotal roles in the history and development of the sport.

The featured marque of the 32nd Rolex Monterey Historic Automobile Races Presented by Chrysler is Chaparral, part of an overall tribute to the "Great American Specials" -- homegrown custom racecars. The Petroleum Museum of Midland, Texas, is sending all of its Chaparral cars for display and parade laps. Former team drivers Vic Elford and Phil Hill, with race honoree Jim Hall, will be present for the activities, including a parade of the "Specials."

In September, the Rolex Vintage Festival Presented by BMW will salute Aston Martin as its featured marque. Automotive icon Carroll Shelby and Roy Salvadori, who teamed to win the 1959 24 Hours of Le Mans in an Aston Martin DBR1, will attend the Festival as part of a tribute for their groundbreaking achievement with the marque. The event's Elite Concours Presented by Road & Track will feature "Amazing Astons," "Transports of Delight" (the great roadsters of the 20th Century) and elite Porsche, Corvette, Riley and Austin Healey cars. Lime Rock's traditional Vintage & Historic Car Show and the Show of Shelbys will display a vast array of foreign and domestic automobiles along with the great signature cars of Carroll Shelby, including Cobras GT 350s, 500s and more.

Source : http://www.theautochannel.com (7/21/2005)

Cadillac Named 'Official Vehicle of Phipps Plaza'  
Simon Property Group , the nation's largest owner, developer, manager and marketer of retail real estate, announced today a strategic alliance between Phipps Plaza, Atlanta's premier upscale shopping destination, and General Motors' Cadillac division. The program, which will utilize Atlanta as a test market, promises to combine the similarities and strengths of two national premium brands into one of the most notable marketing alliances in their respective industries. In addition, the arrangement provides Cadillac with an innovative platform to reach new customers within its targeted demographic, while injecting tangible benefits into its customer retention program.

The alliance is multi-pronged -- by naming Cadillac the "Official Vehicle of Phipps Plaza," the brand will use the shopping center as an interactive stage to highlight its full line of redesigned luxury vehicles, complete with product specialists staffing the displays. Phipps Plaza's highly trafficked valet service, run by Atlanta-based AmeriPark, will be renamed the "Cadillac Valet," supported by exterior promotional signage and a hand-picked Cadillac valet team outfitted in custom Cadillac attire. The valet service, a much- coveted perk at Phipps Plaza, will now be complimentary for all mall patrons arriving in a Cadillac. Finally, these initiatives will be reinforced through lifestyle content with a series of exclusive, invitation-only events created by Cadillac and hosted by Phipps Plaza retailers.

Additional elements supporting the alliance involve seasonal opportunities for Cadillac, such as its sponsorship of Phipps Plaza's renowned Santa and the surrounding holiday set.

"Cadillac's commitment to bold, breakthrough products with world-class performance naturally suits the sophisticated luxury and style of Phipps Plaza," said John Orth, Cadillac Regional Marketing Manager. "Partnering with Phipps Plaza and Simon Property Group provides a unique and creative venue to reach out to existing Cadillac owners and introduce our great vehicles to new consumers. This alliance allows us to take traditional assets and partner with an untapped venue."

"Simon Brand Ventures' positioning of Phipps Plaza as one of the premier shopping destinations in the country was key in establishing the center as a viable marketing medium for an automobile brand that is synonymous with the same level of prestige," said Stewart Stockdale, Chief Marketing Officer of Simon Property Group and President of Simon Brand Ventures, the business-to- consumer arm of Simon Property Group. "What Phipps Plaza and Simon's national network of top-tier shopping centers have to offer major marketers goes well beyond the opportunities offered through traditional mediums. We're pleased that a brand like Cadillac had the foresight to recognize this as an opportunity to provide unprecedented value to its current and potential customers," he added.

Source : http://www.theautochannel.com (7/21/2005)

Evader and the Schneider Group Partner to Form Alliance in Europe  
Bellevue, Washington, based Evader, Inc. (www.evader.us.) (Pink Sheets:EVDR), the maker of electric high-performance vehicles powered by their leading-edge EPIC technology is pleased to announce that it has formally partnered with the Schneider Group to form Evader AG.

Evader AG will now position all sales by the Schneider Group under the Evader banner. The financial partnership will help streamline all European operations and will allow Evader AG to concentrate their buying efforts, increase margins and centralize their parts and accessories operations. In addition, the company has started the construction of a new assembly plant in Poland that will supply product to all 25 of the European Union countries. By assembling in Poland all EU consumers will be able to benefit from several tax and duty efficiencies. The facility in Poland is scheduled to go online by the end of the second quarter in 2006.

"Anticipated demand for the new 2006 models has forced us to take this action now," said Daniel Schneider, Evader's President of European operations. "The cost savings of setting up such a facility makes sound financial sense and will be good for Evader as well as the consumer. It was also important to centralize operations before we receive our first shipments of the new 2006 models. Initially all of our products will be manufactured in our Asian facility but we expect to transition assembly to Poland in time for the 2007 models. Evader is now positioned to make a major move in Europe."

"This is the first big step in executing Evader's long term business strategy for the European market," said Evader's President of Global Distribution, Robert Stoneham, "the EU is maybe our biggest and most profitable market in the World and Evader AG will allow us to maintain a competitive advantage in the market place."

Daniel Schneider will serve as the President and CEO of the new entity that will be based in Zug, Switzerland, and be responsible for all day-to-day operations.

Source : http://www.theautochannel.com (7/21/2005)

Monolithic Power Systems Introduces Compact, Single Supply 50W Class D Audio Amplifier  
LOS GATOS, Calif.--Monolithic Power Systems (MPS) announces the immediate availability of the MP7782, a full bridge Class D audio amplifier. Operating from a single power supply in the range of 9.5 - 24V, the MP7782 can provide up to 50W of continuous output power into a 6 ohm load with up to 90% efficiency. The ambient operating temperature range for the MP7782 is -40 to 85 degrees C making it suitable for a wide range of applications, from home and office entertainment to automotive multimedia and outdoor audio systems.

The MP7782's integrated FETs together with a small TSSOP20 package form a very compact solution. Output gain can be customized by way of external resistors. When not in use, the internal circuitry can be placed into standby mode cutting quiescent current to 2uA. The device also features a closed loop topology that maintains high audio quality despite fluctuations in the power supply rail. This architecture gives rise to an extremely high audio fidelity with a THD+N of 0.06%.

Short circuit and thermal protection are integrated into the MP7782 design. Samples are available from stock immediately. Pricing for the MP7782 begins at $3.48 in 1,000 piece quantities.

Source : http://www.theautochannel.com (7/21/2005)

ZAP Announces 2005 Model Year Smart Cars Have Entered U.S.  
SANTA ROSA, Calif., ZAP , pioneering the next generation of advanced transportation and energy technologies, announced today that 2005 model year Smart Cars have entered the United States.

The 2005 Model Year Smart Cars are the first of the new models ZAP intends to Americanize and offer through its distribution network, specializing in fuel-efficient and advanced automotive technologies, according to ZAP CEO Steve Schneider.

"ZAP intends to offer the newest model year Smart Cars available to its customers," said Schneider. "The money and time spent on earlier model year cars have paved the way for ZAP and its import partners to federalize the newest models. The earlier models from our initial fleet are undergoing final processing now and will be distributed to authorized dealers that undergo our service and parts certification training."

Earlier this week, ZAP announced that a petition for import eligibility has been granted by the United States Department of Transportation for the 2005 Model Year "Smart Car Fortwo Coupe & Cabriolet."

ZAP recently announced the first deliveries of Smart Cars Americanized by ZAP to dealers in eight states as well as the beginning of its dealer service training and certification program. The Smart Car is the stylish, fuel-efficient micro-car from Europe, one of the only available in the country at a time of record gas prices.

Source : http://www.theautochannel.com (7/21/2005)

BorgWarner Declares Quarterly Dividend  
AUBURN HILLS, Mich., -- The board of directors of BorgWarner Inc. has declared a quarterly dividend of $0.14 per share on all of the company's issued and outstanding common stock. The dividend is payable August 15, 2005 to shareholders of record on August 1, 2005.

Auburn Hills, Michigan-based BorgWarner Inc. is a product leader in highly engineered components and systems for vehicle powertrain applications worldwide. The company operates manufacturing and technical facilities in 62 locations in 17 countries. Customers include Ford, DaimlerChrysler, General Motors, VW/Audi, Toyota, Hyundai/Kia, Honda, Renault/Nissan, Caterpillar, Navistar International, Peugeot, and BMW.

Source : http://www.theautochannel.com (7/21/2005)

Wholly-owned Hyundai importer plans to double sales by 2008  
Hyundai took control of the distribution and servicing of its vehicles in the UK yesterday with the formation of a new company, Hyundai Motor UK Ltd (HMUK).

Under factory ownership, HMUK is confident of doubling its yearly sales by 2008 to around 80,000 cars, securing more than three per cent UK market share. The managing director of HMUK is Ray Pope, formerly Finance Director of the RAC plc-owned HCUK import firm.

Pope said, "The change from independent importer to manufacturer owned operation brings a number of key benefits for Hyundai customers in the UK. Chief among these will be our ability to invest much more, both in terms of money and time into ensuring we have one of, if not the best retail network of any manufacturer in the UK.'

HMUKÕs Aftersales Director, Graham Lightfoot noted that Huyundai was still the only manufacturer in the UK with a five year, unlimited mileage, fully transferable warranty across its entire range of cars.

Previously, the rights to distribute Hyundai vehicles in the UK were owned by RAC plc, which had owned the High Wycombe-based distributorship, Hyundai Car (UK) Ltd, since 1993. Hyundai Motor Co. began negotiations to buy out the import businesses when Aviva plc, owner of Norwich Union Insurance, announced plans earlier this year to buy RAC plc.

Hyundai Motor UK Ltd employs around 200 people, and has 165 dealerships with its franchise across the UK. The brand sold 37,000 cars in the UK in 2004.

Source : http://www.autoindustry.co.uk (7/22/2005)

Subaru Redesigns, Repowers 2006 Impreza(R) Line  
Subaru of America, Inc., America's all-wheel drive leader, has introduced the more powerful, restyled 2006 Impreza 2.5 i and Outback(R) Sport models, featuring new engine technology and additional safety features.

Following an interior redesign for 2005, all Impreza models have been restyled for 2006. The new Subaru front-end design for Impreza features a three-section mesh-type grill inspired by the company's aircraft heritage, plus boldly styled headlights with smoke-tinted lenses. Sedan models feature revised wide-body fenders, while the wagons have their own flared fender design, as on the previous model. All 2006 Impreza models are also distinguished by a new tail lamp cluster design. An aluminum hood reduces weight over the front wheels on the Impreza 2.5 i and Outback Sport (WRX models already had an aluminum hood).

The Impreza 2.5 i and Outback Sport models get a more powerful version of the 2.5-liter SOHC horizontally opposed (Boxer) engine for 2006. The addition of the i-Active Valve Lift system and the Electronic Throttle Control system boost horsepower to 173 from 165 while retaining the responsive low- and mid- range torque that Subaru customers appreciate.

All Subaru models are equipped with Symmetrical All-Wheel Drive as standard equipment, giving them responsive handling and the safety benefit of optimal traction for all driving conditions.

The optional 4-speed direct control automatic transmission features enhanced control logic for 2006. Revisions to the electronically controlled version of Symmetrical All-Wheel Drive teamed with this transmission contribute to better handling and enhanced traction performance.

On the safety front, all Impreza models gain the new dual-stage Subaru Advanced Airbag System, while the Impreza 2.5 i and Outback Sport models also get the front seat head/chest side-impact air bags that were already featured in the WRX models.

Impreza 2.5 i - America's Most Affordable All-Wheel Drive Sport-Compact

The Impreza 2.5 RS models have been renamed "2.5 i" for 2006, making their nomenclature consistent with the larger Subaru Legacy(R) models. The 2.5 i Sedan and Sport Wagon models are the most affordable all-wheel drive sport- compacts in the market. Both models continue with the sport-tuned suspension, 16-inch alloy wheels (new 5-spoke design for 2006) and sport-design front seats featured on the previous 2.5 RS.

Also continued is the generous standard equipment list that makes the Impreza 2.5 i models among the best-equipped cars in their class: Anti-lock Brake System (ABS), air conditioning, power windows, power mirrors and door locks, remote keyless entry, AM/FM stereo system with single-disc CD player, tilt-adjustable steering column, security system, an outside temperature gauge and variable intermittent windshield wipers.

The Impreza 2.5 i Sport Wagon offers excellent utility and versatility, providing 27.9 cu. ft. of cargo space with the 60/40-split rear seatback up and 61.6 cu. ft. of space with the seatbacks folded down.

Outback Sport - The Sporty Crossover

Outback(R) Sport, based on the Impreza 2.5 i Sport Wagon, helped usher in the crossover category a decade ago. The Outback Sport Special Edition introduced for 2005 continues with its high-value package of additional amenities.

Outback Sport styling is highlighted by steel gray metallic lower body color, side moldings and bumpers, plus projector-beam halogen fog lights. Symmetrical All-Wheel Drive, 4-wheel independent heavy-duty raised suspension and 16-inch aluminum alloy wheels with 205/55 R16 all-season tires give Outback Sport all-road, all-weather capability. Standard features are shared with the Impreza 2.5 i Sport Wagon and add a 12-volt cargo area power outlet, roof rails with cross bars and a rear bumper step pad.

The Outback Sport Special Edition enhances comfort, function and style with the addition of a leather-wrapped steering wheel, auto-dimming compass rear-view mirror and armrest extension, plus a 140-watt AM/FM premium stereo with 6-disc in-dash CD changer, six upgraded speakers and a sub-woofer. A rear gate spoiler accents the sporty appearance.

More Power and Enhanced Automatic Transmission

The naturally aspirated 2.5-liter boxer engine in Impreza 2.5 i and Outback Sport models gains the new i-Active Valve Lift system that boosts horsepower to 173 from 165 in the 2005 models. Just as important, the new technology improves real-world drivability and performance. Peak torque output remains at 166 lb.-ft. at 4,400 rpm - still one of the highest torque ratings in the segment.

Using oil pressure generated by engine speed and load, the i-Active system varies intake valve lift by locking the tappet into a higher position by means of a transverse pin. The effect is that of having two separate tappets to act on the camshaft lobe operating the intake valve. Variable lift works on one of the two intake valves. At low engine speeds the two valves open at different levels, causing a swirl of air and fuel and boosting torque. At higher speeds, both valves are opened in the "high" position to increase horsepower.

The optional 4-speed direct control electronic automatic transmission features the more advanced adaptive shift control system first introduced for the 2005 Legacy and Outback models. The new system controls transmission shift points based on driver input and vehicle load to optimize engine performance. The slope control feature provides engine-braking control on descents.

Enhanced Safety

The Impreza 2.5 i and Outback Sport models gain front seat head/chest side-impact air bags, which were already featured in the WRX models. All Impreza models for 2006 get the new Subaru Advanced Frontal Airbag system. The driver's side air bag deploys according to the driver's proximity to the steering wheel, as measured by a sensor on the seat track. In the passenger side front seat, a sensor module detects weight on the passenger seat - first determining if it's occupied, and if so by a child or adult - to control air bag deployment. As part of the system, the dashboard features a new "Airbag" indicator light.

The Subaru Ring Frame Reinforced body structure provides Impreza models with outstanding protection in many types of collisions. A hydroformed front subframe and side sills along with tailored blank-welded B-pillars provide an exceptionally strong structure. The high degree of rigidity contributes to sharp handling response and smooth ride quality while helping to reduce interior noise.

On all Impreza models, the standard 4-channel / 4-sensor Anti-lock Brake System (ABS) incorporates Electronic Brake-force Distribution (EBD). This system enhances braking performance and stability by actively optimizing braking force between the front and rear wheels according to how the vehicle is loaded with passengers and cargo.

In all Subaru models, the front 3-point seatbelts integrate electrically triggered pre-tensioners and force limiters. Active front seat head restraints in the Impreza 2.5 i and Outback Sport models are designed to help reduce whiplash injury in a rear collision. The safety brake pedal system is designed to yield during a serious frontal impact in order to help reduce injury to the driver's lower limbs.

Standard Symmetrical All-Wheel Drive

Symmetrical All-Wheel Drive is a complete system comprised of the horizontally opposed boxer engine and the all-wheel drive power distribution system that varies by model and transmission. The aluminum boxer engine and simple, symmetrical drivetrain layout help to lower the center of gravity, which in turn contributes to precision handling response.

Impreza 2.5 i and Outback Sport models equipped with the 5-speed manual transmission utilize a viscous coupling locking center differential that distributes power 50/50 front to rear. In models with the 4-speed direct control automatic transmission, an electronically managed continuously variable transfer clutch actively manages the power distribution based on acceleration, deceleration and available traction. Both systems power all four wheels all the time and will transfer more power to the wheels with the best grip should slippage occur.

For 2006, new control logic in the automatic transmission AWD system enhances stability by monitoring individual wheel speeds and reacting more quickly to wheel slippage.

The new control logic also helps to improve tight corner braking, contributing to more neutral handling response (reduced understeer and oversteer). The system provides enhanced traction on slippery surfaces, as well.

Source : http://www.theautochannel.com (7/21/2005)

Tenneco Automotive Reports Strong Second Quarter 2005 Operating Results  
LAKE FOREST, Ill., -- Tenneco Automotive reported second quarter net income of $33 million, or 71-cents per diluted share, up from net income of $30 million, or 69-cents per diluted share a year ago. Adjusted for the items below, second quarter net income rose to $35 million, or 77-cents per diluted share, compared with $31 million, or 70-cents per diluted share in second quarter 2004.

EBIT (earnings before interest, taxes and minority interest) was $83 million compared with $76 million a year ago. EBITDA (EBIT before depreciation and amortization) was $127 million, versus $120 million in second quarter 2004. On an adjusted basis, EBIT was $85 million, up from $84 million a year ago, and the company reported its 14th consecutive quarter of year- over-year improved adjusted EBITDA at $129 million, up from $128 million in second quarter 2004. See the tables attached to the press release, which reconcile GAAP results to non-GAAP results.

Despite a $65 million impact in the quarter from the discontinuation of General Motor's advance payment program, operating cash inflow in the quarter was $28 million, versus a $46 million inflow in the second quarter of 2004. The strong cash performance was driven by inventory reductions and improved accounts payable. At quarter-end, total debt was $1.412 billion, down from $1.419 billion a year ago. Debt net of cash was $1.346 billion versus $1.253 billion a year ago, primarily due to the discontinuation of advance payment programs by General Motors, Ford and DaimlerChrysler, which had a $94 million impact on debt over the last 12 months.

Tenneco Automotive generated its 13th consecutive quarter of year-over- year revenue growth with revenue of $1.180 billion, compared with $1.113 billion a year ago. Favorable currency benefited revenue by $33 million. Total OE revenues were up 7% year-over-year, outpacing a 2% increase in global industry production. Revenue was driven by the company's strong position on top-selling vehicles, continued gains from new OE business in Europe and stronger Japanese OE business in North America.

"Our strategies for generating top-line growth and cash continue to be effective despite difficult and volatile market conditions," said Mark P. Frissora, chairman and CEO, Tenneco Automotive. "We are also benefiting from our intense focus on managing costs and improving operational efficiency through Lean and Six Sigma. In addition, our balance in terms of products, markets, customers and vehicle platform mix gives us a competitive edge and continues to drive our progress."

The company's gross margin in the quarter was 20.3%, down 1.3 percentage points from a year ago. Higher steel costs, restructuring charges and business mix offset savings and improved efficiencies from Lean manufacturing, Six Sigma programs and other cost reduction initiatives.

Total steel cost increases in the second quarter were $35 million, which were largely offset by the company's cost reduction efforts, including SGA&E restructuring savings, material cost savings, Six Sigma program savings of $9 million and Lean manufacturing efficiencies as well as steel cost recovery from OE and aftermarket customers. Based on the company's efforts to offset increased steel costs and trends in the steel market, the company doesn't currently anticipate a significant year-over-year impact on operating results through the remainder of 2005.

Sales, General, Administrative and Engineering (SGA&E) expense in the quarter was 9.4% of sales versus 10.7% one year ago. SGA&E improvement was driven by restructuring and tight controls on discretionary spending.

The company outperformed its bank debt covenants in the quarter. At June 30, the leverage ratio was 3.41, below the maximum limit of 4.75; the fixed charge ratio was 2.03, exceeding the minimum ratio of 1.10; and the interest coverage ratio was 3.06, exceeding the minimum coverage ratio of 2.0.

Through the first half of the year, Tenneco Automotive reported net income of $40 million, or 88-cents per diluted share, versus net income of $28 million, or 65-cents per diluted share reported for the first six months of 2004. On an adjusted basis, year-to-date 2005 net income was $44 million, or 97-cents per diluted share, versus adjusted net income of $37 million, or 85-cents per diluted share for the same period one year ago.

Year-to-date EBIT was $127 million compared with EBIT of $109 million in the first six months of 2004. EBITDA was $217 million versus $198 million a year ago. Adjusted year-to-date 2005 EBIT was $132 million, compared with $131 million a year ago, and adjusted EBITDA was $222 million, versus adjusted EBITDA of $220 million for the same period a year ago.

Source : http://www.theautochannel.com (7/21/2005)

STAR Publishes Technology Update for Franchised Auto Dealers  
Standards for Technology in Automotive Retail (STAR), a global Information Technology (IT) standards body for the retail automotive industry, has released a new version of their Dealership Infrastructure Guidelines (DIG). The publication describes the types of IT equipment and services needed for franchised auto dealers to conduct day-to-day business with auto manufacturers and other business partners.

The latest release of the DIG (version 2005 v2.0) includes new guidelines for dealers who use portable, wireless computers in their dealerships' showrooms or service areas. The document emphasizes the need to implement adequate security measures to protect the dealer's business information and computer equipment.

"Just as blueprints guide dealers when remodeling their dealerships, the DIG provides guidance as dealers add wireless computers and other IT equipment in their dealership," said dealer Tom Arden from Downs Ford in Toms River, New Jersey.

"Dealers want to use technology to improve their business. They need to understand the business aspects of computer technology, not the technical details. The DIG provides executive summaries for dealers and IT details for the dealers' technology vendors," said Eric Purdum STAR Standards Chair.

STAR's initiatives provide the opportunity to improve the daily business activities of dealers, retail systems providers, and manufacturers , which leads to higher customer satisfaction, timely, access to business information, and reduced operating costs.

Source : http://www.theautochannel.com (7/21/2005)

Another Award Underscores the Innovation of Goodyear's Assurance  
Already honored with several awards, Goodyear's popular "any condition" tire, Assurance featuring TripleTred Technology, is the subject of another accolade -- recognition as "one of the most innovative ideas of the year" from R&D Magazine.

The magazine staff has selected the Goodyear Assurance tire as recipient of an "R&D 100 Award," an award program the Chicago Tribune has referred to as "the Oscars of Invention."

The editors of R&D refer to the awards this way: "Antilock brakes, ATMs, the liquid crystal display, fax machines, HDTV -- all are former R&D 100 Award winners. The winning of an R&D 100 Award provides a mark of excellence known to industry, government and academia, as proof that the product is one of the most innovative ideas of the year."

R&D Magazine focuses on editorial content that delivers details on emerging technologies, trends, technical analysis, case studies and essential product information. The New Jersey-based publication has a circulation of more than 100,000.

The 43rd annual awards summary will appear in the magazine's September issue, with an awards presentation scheduled for October in Chicago.

Goodyear's Assurance featuring TripleTred Technology was the only tire included in the new group of R&D 100 products, and the first tire honored in the contest in 35 years. The award acknowledges the research and design work by Goodyear and Sandia National Labs in the development of the Assurance tire.

The tire was designed to be visually arresting, and its eye-catching sinuous and sculpted directional tread pattern is as attractive as it is functional. The aggressive appearance also helps retailers explain the tire's benefits and technology to consumers.

The tire incorporates three unique tread zones for superior traction in any kind of weather. A unique Water Zone consists of deeply carved Aquachutes, which propel water away from the tire's tread to assure more tire contact with the road when the surface is rain-drenched. An interlocking tread pattern creates an Ice Zone, which translates into more gripping power on icy or snow-covered roads. A Dry Zone rounds out the three tread element areas, enhanced by reinforced tire shoulders for confident maneuvering around curves, potholes and unexpected road debris on dry pavement.

Assurance featuring TripleTred Technology also incorporates scientific advances in rubber compounding, including the use of Fiberglass fibers and volcanic sand in the tire's winter formulated compound, which allows the tire to maintain flexibility in cold weather.

The extremely popular tire is one of Goodyear's most-awarded products ever, including a Business Week Industrial Design Excellence Award, recent recognition from Popular Science and Popular Mechanics magazines, and selection as a finalist for the Automotive News PACE Award. The critical praise has translated into tremendous commercial success, as the Assurance line is the most successful new product launch in Goodyear's history.

Goodyear is the world's largest tire company. Headquartered in Akron, Ohio, the company manufactures tires, engineered rubber products and chemicals in more than 80 facilities in 28 countries. It has marketing operations in almost every country around the world. Goodyear employs more than 80,000 people worldwide.

Source : http://www.theautochannel.com (7/21/2005)

Amicus Latest on Rolls Royce Filton Dispute  
"There was a mass meeting of our members at the plant today and it was decided that a ballot for industrial action be held as soon as possible in support of Jerry Hicks. Amicus' 3,000 manual members on the site will be balloted at the earliest opportunity.

"There was also a meeting of union convenors from all the UK Rolls Royce sites today at which they all pledged their support for Jerry."

Amicus has started the ballot process. Members will be asked two questions - if they support strike action and/or action short of a strike. If it is a yes vote, it is likely to be in the region of four weeks before we can take action.

Source : http://www.theautochannel.com (7/21/2005)

ACDelco to Offer Customers Cash Back Rebates in Fall Durastop Brake Bucks Promotion  
GRAND BLANC, MICH. -- Vehicle owners looking to replace their brakes this fall can experience premium ACDelco replacement parts at competitive prices when they purchase ACDelco DuraStop® brake products from participating Independent Service Centers (ISCs) as part of ACDelco's DuraStop "Brake Bucks" Cash Back promotion.

ACDelco will reimburse consumers $15 for each set of select quality ACDelco DuraStop friction pads, shoes and loaded calipers purchased from and installed by a participating ISC from Sept. 1-Oct. 31, 2005. The offer is not valid at new vehicle dealerships or on products being replaced under warranty, and there is a $30 maximum rebate limit per customer.

"This rebate promotion allows customers to upgrade to a premium product at an even better price," said Malcolm Fordyce, ACDelco merchandising specialist. "Furthermore, with ACDelco, consumers have the peace of mind knowing our DuraStop brake products undergo the most rigorous testing available for aftermarket products. We do this not only to adhere to federal safety standards for Original Equipment Manufacturers, but also because it's the right thing to do for our customers."

To receive reimbursement, consumers must submit a completed rebate form, the box end flaps of the DuraStop product as proof of purchase and a copy of the repair invoice to verify the installation. Vehicle owners can go to acdelco.com for an ACDelco DuraStop "Brake Bucks" Cash Back rebate form and to find a participating installer in their area. ACDelco will mail a check for the rebate amount to the consumer.

ACDelco's brake line features DuraStop ceramic brake pads made from a combination of ceramic and nonmetallic materials rather than from any semi-metallic materials. When installed properly, the results are exceptionally smooth stops, less noise and increased durability. The line includes brake shoes, drums, rotors, cables and disc brake pads that fit virtually all import and domestic vehicles, including Toyota, Honda, Nissan, Ford, Chrysler and GM.

ACDelco is a global leader in automotive replacement parts and services offering products for virtually all vehicles. Headquartered in Grand Blanc, Mich., ACDelco markets automotive replacement parts worldwide under its brand name.

Source : http://www.theautochannel.com (7/20/2005)

Employee discounts boost Big Three sales and market share  
Offering employee discounts to all consumers appears to be paying off for the Detroit-based Big Three in the form of increased sales and market share, according to actual retail transaction data from more than 6,200 automotive franchises compiled by the Power Information Network (PIN).

Both Ford and DaimlerChrysler, now offering competitive employee discount pricing programmes of their own, have rebounded in July from mediocre results in June when GM alone offered employee pricing.

For the first 15 days of July, GM, whose GM Employee Discount for Everyone campaign extends across all of its vehicle brands, captured 30.3% of the retail new-vehicle market compared to 25% a year ago and 33.4% during the first 15 days of June, according to PIN. In addition, GMÕs retail sales were up 42% in July compared to a year ago.

FordÕs share rebounded to 19.6% in the first 15 days of the month Ñ up from 15.1% in June and 18.1% in July 2004 Ñ and its retail sales jumped 27% versus a year ago. Its Ford Family Plan offers an employee discount to all buyers for its Ford, Lincoln and Mercury vehicles.

DaimlerChrysler, whose Chrysler GroupÕs Employee Pricing Plus programme offers employee discounts on Chrysler, Jeep and Dodge vehicles, carried 12.5% of the market in the first 15 days of July Ñ up from 11.3% in June, but down from 13.3% a year ago. DaimlerChryslerÕs retail sales have climbed 11% versus July 2004.

The three major Japanese companiesÑToyota, Honda and Nissan Ñ all have lost market share in July when compared to both June 2005 and July 2004. Toyota has captured 12.6% market share, Honda 8.4% and Nissan 6.1% in the first half of July, each of which is down versus both June 2005 and July 2004. However, from a sales perspective, the major Japanese companies are holding their own. Nissan (up 22%), Toyota (up 17%), and Honda (up 16%) are all showing sales increases in July versus June, and all three are also up versus July of 2004.

While July is shaping up to be another strong sales month, JD Power and Associates is holding its annual sales forecast at 16.9 million units.

'These programmes are likely pulling forward some of the model year-end sales by a month or two,' said a spokesman.

Source : http://www.just-auto.com (7/21/2005)

Volvo use 1link to fill ‘hole’ in inclusive service records  
Volvo Car has become the first manufacturer to recommend to its retail network that they use 1link Service Network to fill the potential gap in servicing records created by inclusive servicing schemes. A lack of service records can lead to lower residual values and even potential vehicle safety problems.

Several car companies have introduced service schemes which offer three years of either free or low-cost servicing from a franchise dealer at a fixed price when the vehicle is bought. However, because retailers carrying out inclusive servicing raise no invoices to the fleet operator or owner, they cannot verify the service history of vehicles that they own or even guarantee that a vehicle has been maintained at all. They may have no stamped service book or other type of easily accessed service record, which may have implications for fleet duty of care issues.

Source : http://www.autoindustry.co.uk (7/22/2005)