Japan auctioneers to block relief from motor import tariff cut?

By Indika Sakalasooriya
Even though the motor vehicle prices have come down following the vehicle import tariff cut by the government a few weeks back, the motor traders are now speculating a slight increase in the vehicle prices in the coming few months as a result of vehicle prices going up in Japanese motor vehicle auctions.
Harshana De Alwis, a young lawyer who wanted to exploit the best out of the duty reduction recently, went to one of the well known motor traders in the country who specialises in used vehicles from Japan.
There Harshana was shown a number of cars of the vehicle model he was seeking through the internet and was told that ‘if you reserve the car now you can get it at Rs.1.4 mn, but if you wait thinking that the prices will further dip, you might end up buying the same car for Rs.1.6 mn’.
To unwind the puzzle Harshana asked the trader why would the car prices go up in the coming few months when there is no change in the duty reduction stance by the government?
The answer the motor trader gave to Harshana disclosed something neither Harshan nor most of us ever knew.
“One of the major markets for used vehicles in Japan is Sri Lanka. As a result of this there are a number of Sri Lankans who have been involved in this business and now some of them even run these auctions. So once they heard that the government has cut duty on import vehicles they have started jacking up prices in the vehicle auctions in Japan,” the trader told Harshan.
Following this scoop by Harshana, The Bottom Line did some research of its own and found out that almost all the key used-motor vehicle traders in the country are telling the same story.
“Yes, the vehicle prices may go up from the present level following the duty reduction because now there is a big demand in Sri Lanka. The auctioneers in Japan know this and they are slowly increasing their prices,” one motor trader in the Western Province, who preferred anonymity, told The Bottom Line.
However, he said that once the competition builds up among local motor traders, again there could be tendency for vehicle prices to come down, even though the margins for traders may trim.


All new 2011 Honda Accord this August

For years at a time, the Honda Accord has enjoyed the title of America’s most popular passenger car and with the continuous improvements the humble nameplate has received over the years, it’s easy to see why.
The latest model, the new 2011 Honda Accord Sedan and Coupe, are set to go on sale this August and have received some extensive updates including improved fuel economy, revised styling and the addition of a new leather-equipped Special Edition (SE) trim level.
Improvements to vehicle aerodynamics, engine friction and transmission gear ratios all contribute to significant fuel economy improvements. The EPA fuel-economy ratings for the 2.4-liter four-cylinder Sedan models equipped with an automatic transmission improve by 2 mpg in the city and 3 mpg on the highway, for a city/highway rating of 23/34 mpg. As for the 3.5-liter V-6, preliminary EPA fuel-economy ratings for the Sedan are 19/30 mpg city/highway mpg, an improvement of 1 mpg in highway driving.
Peak output for the four-cylinder engine ranges from 177 to 190 horsepower depending on trim and body styles, while the V-6 comes in at 271 horsepower. A 5-speed manual transmission is standard on 4-cylinder models and a 5-speed automatic is available. A 5-speed automatic transmission is standard on V-6-powered models. A 6-speed manual transmission is available exclusively on the Accord EX-L V-6 Coupe.
To differentiate the latest 2011 Honda Accord Sedan and Coupe from the previous model, the exterior has been updated with a new grille design, a revised front bumper and rear deck lid, plus new wheel designs.
Other changes include the updated Accord SE trim, which is now available with many of the more luxurious features from the Accord LX-P. These include leather-trimmed seating, heated seats, driver’s power-lumbar support and a leather-trimmed steering wheel.
Three audio systems are available--all with MP3/WMA playback capability and an auxiliary input jack. The standard system provides a single-disc CD player, six speakers and 160 watts of power, and all Accord models get steering wheel-mounted audio controls. A premium 270-watt audio system comes standard on Accord EX Coupe and Accord EX-L Sedan models, and includes a six-disc CD changer and seven speakers including an 8-inch subwoofer. The range-topper is the Honda Satellite-Linked Navigation System (available on Accord EX-L), which uses an 8-inch screen and an interface dial for user input.
With improved fuel economy and more up market features on even the base models, the latest 2011 Honda Accord will only strengthen what is already a proud and impressive nameplate.


GM preparing IPO in July

Almost a year after it went through bankruptcy, General Motors is preparing to go public once again.
The General is readying a statement that will outline its plan for a public offering of the company’s stock. The initial public offering is expected to take place in July, and the listing could bring in up to $20 billion for the company.
GM is also talking with Wells Fargo and JP Morgan Chase about potential deals that will make it easier for customers to get approval for auto loans.
The company is expecting to raise $15 to $20 billion in the offering, thanks to demand from investors that appears to be stronger than what most observers were expecting.
GM’s CEO, Ed Whitacre, and other company executives have been pushing to have the IPO this year. As it stands now, the U.S. government has a 60.8 percent ownership share in GM. Investors will by buying part of that stake.
GM was once publicly traded, but when it entered bankruptcy, it was split into two entities--”old GM” and “new GM.” The “old” GM contained all of the company’s bad assets, while the “new” GM continued the remaining good assets. It also went private as part of the process, but now that a year has passed and the company is the process of launching new models like the 2010 Cadillac CTS Sport Wagon, the 2010 Cadillac SRX, and the 2011 Buick Regal, GM may have built enough positive buzz to draw investors who might have previously been skittish about the automaker’s future.
[Courtesy Chicago Breaking Business]


Ferrari to launch one new model every year

Ferrari will follow Lamborghini’s lead by launching at least one new or heavily updated model every year as the automaker attempts to keep up with growing waiting lists while still attracting new customers to the brand.
Ferrari will maintain its four main model lines, consisting of the California and 612 Scaglietti in the GT division and the 458 Italia and 599 GTB Fiorano in the sports car division.
Each year, one of the four main models will be replaced by an M or modificato model. This M model will come roughly four years after a car’s initial launch and will essentially feature a revised design plus power train and chassis enhancements. After four years, this M model will then be replaced by an entirely new model--in essence, each Ferrari model will be replaced every eight years, with a major update in the middle of its life cycle.
On top of this, a flagship super car like the Enzo will be launched every decade or so, and Scuderia and Spyder variants of Ferrari’s other models will also be launched.
On the horizon is a replacement for the 612 Scaglietti, which is expected to be launched in the first half of next year. This will be followed by a replacement for legendary Enzo supercar towards the end of 2011 and a replacement for the 599 GTB in 2012.
One of Ferrari’s main concerns is the relatively long wait time customers are faced with when purchasing one of its cars brand new. Currently, it’s not unusual to have to wait between 18 months and two years for delivery of a new Ferrari model so, understandably, many customers are looking elsewhere. Ferrari wants to reduce wait times to less than a year but the key won’t be building more cars, instead the plan is to build cars quicker.

Gruntier Grande Punto on the cards soon!

It’s been exactly a year since the Punto was launched and Fiat’s baby has done reasonably well for itself. With a gorgeous Italian form, reasonably spacious interiors along with an amazing ride and handling package, the Punto made for a pretty viable option. However, the engines were a bit of a letdown.
While the petrol 1.4 was pretty capable, it was the more popular 1.3 Multijet diesel that suffered on performance. While the same engine proved itself to be a nippy performer in the Swift and the Ritz, the Punto’s heavier kerb weight made it a lazy performer. And now with Ford and Hyundai coming up with better performing diesels, it was time for the Fiat to up the Punto’s game.
And that’s just what Fiat has done. Floor this baby and you can immediately notice the extra pep in performance. The extra pep comes from the same engine that powers its bigger sibling, the Linea. Shifting from first to second in the power band induces an almost first gear wheel spin thanks to the massive wave of torque. This is the result of the variable geometry turbocharger that not only offers a higher power output but also aids drivability and fuel efficiency thanks to lesser use of throttle.
In a segment currently operating with fixed geometry turbo Engines delivering 69-75 PS of power, the Punto will be the only car in its segment, with a ‘locally produced’ Variable Geometry Turbo engine. The Hyundai i20 is the only other hatch with similar power output and we can’t wait to pit these together. The Punto 90 HP as it has been christened features minimum changes on the outside with the badging and the chromed door handles being the only differentiating factor. On the inside, the seats now feature sporty red stitching to highlight the new sporty character.
With Fiat promoting the Punto 90 HP as a premium hatchback offering high performance as well as best in class features, expect the 90 HP variant to be on the expensive front. With the top of the line diesel Punto already retailing at Rs.5,90,000 exshowroom Delhi, Fiat will have to keep it’s pricing in check. Keep watching this for more.


Emerging markets boost auto sales

Emerging markets are leading a recovery in global auto sales, which have risen 18 percent, to 29 million cars and light trucks, in the first five months of 2010, according to data compiled by Paris-based Renault SA.
China recorded the biggest gains of any major market: a 48.5 percent surge in auto sales to 6.7 million units in the first five months of the year. That expanded China’s share of the global market to 23 percent.
Demand also was strong in the other so-called BRICs -- the big, emerging markets of Brazil, Russia, India and China.
Sales rose 13 percent in Brazil, which has a 4 percent share of the global market, and 30 percent in India, which now accounts for 3 percent of global sales.
Among the mature markets, the United States is recovering relatively fast, with light vehicle sales up 17.2 percent at 4.6 million units in the first five months of 2010.
But overall, sales in the world’s three large mature markets -- North America, Europe and Japan -- lagged the newer markets.
(Courtesy The Detroit)


Chinese state fund to take a stake in Volvo

A regional Chinese state fund will take a stake in Volvo cars. The Swedish carmaker Ford of the U.S. recently sold to China’s Geely, financial Daily Dagens Industri said on Thursday, quoting a Geely spokesman.
The Chinese fund is based in the oil-rich city of Daqing, in China’s northeast, the daily reported.
“The regional state fund is Geely’s external financial partner,” Anders Fogel, Geely’s spokesman in Sweden, told the newspaper.
“We can’t immediately say what percentages the partners will have in Volvo cars,” he added.
According to Dagens Industri, quoting sources close to the deal, the purchase will be finalised in August.
Sweden’s TV4 television said Daqing would take a 40 percent stake in the carmaker.
Volvo cars has been a separate company from Sweden’s Volvo Group, which makes trucks, buses and boat and aircraft equipment, since its 1999 sale to U.S. car giant Ford.
On March 28, Ford announced it had agreed to sell Volvo to Geely for 1.8 billion dollars, almost four times less than what it had paid for the brand 11 years earlier.
Geely has said it had plans to expand Volvo’s presence in China, now the world’s largest car market. (AFP)