The Nissan NuVu electric concept car

During the 2008 Paris Auto Show, Nissan unveiled their new Nuvu concept, an electric 2+1 micro-car.


It is a three-seat electric car designed to reduce congestion and environmental friendly.

The car is powered solely by a battery. There are two main seats and an extra seat for a third passenger. It is powered by an electric engine that can be recharged through a PowerPoint or using the solar panels arranged in the shape of a tree and its branches on the glass roof.


The electric car will be produced by 2010 for the US and Japanese markets before marketing to more countries by 2012.

Car loans interest rate hike

It’s painfully clear that whenever the prices go up, it will pass over to the consumer. As a consumer, the question now is how to maximize the consumer welfare as welfare are measured cardinally in terms of ringgit and cent.


The evidence on consumer behavior suggests that, with respect to prices, consumers respond to interest rates in choosing a borrowing institution, thus to value and to be able to recognize several of a bank’s attributes when searching a borrowing institution, the consumer not only should be selective but let the bank hear and understand your issues and share your concern.

The only way that we’re going to lower the interest rate is by lowering our actual demand for borrowing car loans.

Maybank hire purchase senior manager Nor Siah Othman said the bank had experienced a drop of about 40% in car loan applications in the past two months due to higher rates.


She also advised car owners to restructure their loans to stretch the monthly payments longer after a few years of repayments if they find it a burden to service their loans.

A freelance car salesman identified only as Teo said a buyer taking a RM42,000 loan would have to pay about RM54,000 over seven years - about RM4,000 more compared to the RM50,000 paid when the interest rate was 2.7%.

AmBank group public relations manager Norlidah Abd Rahman said not all banks charged as high as 4.3%.

“If the car bought now did not carry extended warranty under comprehensive insurance, the interest rate could be as low as 3.6% - 3.9% too,” she said.

Kuala Lumpur and Selangor Car Dealers and Credit Companies Association president Khoo Kah Jin said interest rates for new cars were not that high at between 3.5% and 3.7%.
He said there was no reason for used car interest rates to be as high as 4.5% - 7.5%.
Khoo said the association had always pushed for the interest rates for used cars to be only 1% higher that of new cars.

TATA BOUGHT JAGUAR AND LAND ROVER

Car giant Ford has sold its luxury UK-based car brands Jaguar and Land Rover to Indian company Tata.

Tata, India's biggest vehicle maker is paying $2.3bn (£1.15bn) for the British brands after months of negotiations over the price.

The negotiations started last June when Ford announced its intention to sell the companies as a package. Jaguar and Land Rover employ about 16,000 staff at UK plants in the West Midlands and Merseyside.

Tata said the deal should be completed by the end of the summer, subject to applicable regulatory approvals.

After months of fevered speculation and several postponements, Tata Motors is all set to bring the Land Rover and Jaguar brands into its fold.

On June 11, 2007, Ford announced its decision to sell off Jaguar and Land Rover.

About a month later, the Tatas' interest in Jaguar-Land Rover became public. On August 24, Ratan Tata confirmed his interest for the first time on CNBC-TV18. Then, in November, the Workers Union approved Tata as its choice for a new owner.

After that, there was a lull with Christmas around the corner. But in the New Year, on January 3, Ford said Tata Motor was the preferred bidder. Finally, yesterday was when sources say the deal was inked and hopefully that news will become public soon.

WORLD CHEAPEST INDIAN CAR TATO NANO

It is good news. The world cheapest Indian make four-door five-seater car, Tata Nano, will sell for 100,000 rupees or $2,500 (about RM 7,500) but not available in Mlaysia.

Tata Nano will goes on sale later this year, has a 33bhp, 624cc, engine at the rear.

The safe, affordable and all weather transport has no air conditioning, no electric windows and no power steering, but two deluxe models will be on offer.

Initially, Tata will make only 250,000 Nanos and expects eventual annual demand of one million cars.

Indian car sales are predicted to more than quadruple to $145bn by 2016.

Proton and Volkswagen deal is off

The government and Volkswagen said today they had shelved long-running talks about an alliance between the German firm and Malaysia's national carmaker Proton.

Malaysia's state investment arm Khazanah Nasional, which controls Proton, said it had discontinued negotiations with Volkswagen.

The German carmaker also said in a statement it and the Malaysian government had for the time being decided "to shelve their joint talks" about the alliance.

The talks began in October 2004 aiming to revitalise Proton, which experts say has suffered from stiff competition, a lack of new models and a reputation for poor quality.

Khazanah said it had also ended talks with General Motors. The government had earlier said it would turn to the US auto giant if talks with Volkswagen failed.

An improvement in Proton's domestic sales and exports had led to the decision to halt negotiations, the state investment arm said in its statement.

"The government is therefore of the view that Proton's management should be allowed to continue with its plans to further strengthen the company," it said.

But it also left the door ajar for a future tie-up, saying a strategic alliance could be considered at a later date.

"Talks with Volkswagen have not broken down. They may have discussions later on," a senior finance ministry official, who wished to remain anonymous, told AFP.

"For the time being, Proton will not enter into any pact with any car manufacturer. The government has decided that Proton will be managed by itself," the official said.

Proton has suffered a sharp decline in market share and been hit by losses, including a 46.75-million-ringgit loss over the three months to June.

A deal was expected to boost Proton's efforts to reclaim top spot in Malaysia and gain a foothold in the lucrative European market.

But such partnerships were hard to forge because of the government's reluctance to cede control of a key national company to foreign hands, analysts said.

"We can only speculate but management control and the shareholding structure was probably the main issue. The talks have really dragged on," Kurnia Insurans chief investment officer Pankaj Kumar told AFP.

"Proton cars have been selling well locally for the last few months but at the end of the day, Proton has to be competitive globally," he said.

"I don't think it has been that innovative. The new models are mostly re-badged versions of previous models," he added.

A Volkswagen spokesman said in Frankfurt that the group was now looking for "new commitments" in Southeast Asia.

"The company continues to pursue the goal of developing a successful foundation for production and distribution in Southeast Asia for years to come," the firm said.- AFP

China's Chery produces 1 millionth car - long shot at Toyota

China's Chery Auto becomes the first Chinese automaker to produce the millionth car on August 22, 2007 to become the country's first indigenous automaker to reach the milestone.

The 10-year-old Chery achieved a miracle in the automotive industry in the world by making its first million cars within seven years and nine months, said a statement from the company.

It took Chery about six years to make its first half million cars, and only one year and a half to complete the second half million.

The 1 millionth car is an A3, a four-door hatchback which made its debut at last year's Beijing auto show and was expected to be sold on market later this year.

In contrast with Chery, Sino-German automaker FAW Volkswagen spent 13 years on making its first million cars, while it took more than eight years for Shanghai GM and Guangzhou Honda to build their first million cars.

China's first Sino-foreign automaker Shanghai Volkswagen, established in 1985, turned out its 3.5 millionth car in January 2007.

Chery, the ambitious flag-bearer of Chinese indigenous brands, is currently capable of producing 400,000 cars, 400,000 engines and 300,000 transmission cases a year and plans to raise its annual output to 1 million cars by 2010.

A new plant, which will begin production in October this year, is expected to increase Chery's annual capacity by an additional 300,000 cars.

China currently has 30 sedan manufacturers, nine of which produce more than 200,000 units a year.

Chery, based in the eastern city of Wuhu, sold 232,785 cars in the first seven months of the year, maintaining its position as the country's seventh largest automobile manufacturers and the fourth largest sedan producer.

It held a 7.2-percent share in the domestic market last year, up from 6.7 percent in 2005.

The company has exported 153,694 cars since 2001, exceeding exports by any other Chinese sedan producer for four consecutive years.

BYD Auto, a small privately owned carmaker that recently graduated from making batteries, has grandly announced that it aims to be a global auto champion by 2025 by moving more than 13 million units a year. The only problem is the Hong Kong-listed BYD sold a mere 60,000 cars last year, less than 0.7 percent of that of Toyota, which has unseated General Motors to be the world's top carmaker this year.

Two years ago, Geely, another privately owned Chinese carmaker, declared that it expects to sell 2 million vehicles annually by 2015, with two-thirds abroad. The company's 2006 sales stood at 200,000 units.

Commenting on such pompous boasts, Yale Zhang, director of Greater China Vehicle Forecasts for US auto consultancy CSM Worldwide Corp, says: "They are only trying to grab publicity."

But Zhang is quick to add that it's just "a matter of time" before one or two local companies grow into globally competitive brands, even if not as big as Toyota. "Yet it will take them 20 to 30 years," Zhang predicts.

Most Chinese car brands have been making rapid progress in recent years as a result of rising prosperity and the consequent increase in vehicle demand in the world's most populous country.

According to Zhang, Chery, the top Chinese nameplate in the passenger car sector, is the most promising candidate to become a global player. The company, based in the eastern city of Wuhu, sold more than 300,000 units last year.

A partner of Chrysler and Fiat, Chery is widely seen to have the strongest research and development capability, with the biggest lineup among Chinese carmakers. It also enjoys strong backing of the central government and local authorities.

Chery has been researching the success of Toyota, from product portfolio, manufacturing, quality control and cost-cutting to marketing, sales and overseas expansion. "We will become a Chinese Toyota," it declares.

Chery aims to boost its annual sales to 1 million units by 2010, a much more realistic goal than that of BYD or Geely. It also plans to double the number of its overseas plants to 14 and lift its sales abroad to 400,000 units from 52,000 units last year.

Other Chinese brands are also trying to follow the path of Toyota. A top executive from Geely says: "In the long term, we will have plants in all regions of the world where Toyota has."

Despite fast growth, says Jia Xinguang, an independent auto industry analyst based in Beijing, indigenous brands are no match for global giants in terms of research and development, quality, financial power and internationalization. Jia predicts the nearest that the strongest Chinese brand will go to a global nameplate in the next one or two decades is French carmaker PSA Peugeot Citroen.

Chinese automakers mainly produce cheap cars that are looked down on abroad in terms of quality. Earlier this year, the Zhonghua sedan from Brilliance China Auto, partner of German luxury carmaker BMW, only achieved a rating of one star out of five in a crash test by Germany's ADAC auto club, making headlines in German newspapers. This could well affect Brilliance's plan to sell 158,000 own-brand sedans in Europe by 2011. Similarly, a Chery model has had a poor test record in Russia.

Chinese brands are also facing an increasing number of intellectual property issues. The most recent case is that of Shuanghuan Automobile, a small carmaker in the northern city of Baoding. It was sued last month in Germany by BMW, which claimed the Chinese company's CEO model closely resembles a previous version of its X5 sports utility vehicle.

Daimler also threatened to take legal action against Shuanghuan, saying the latter's Noble is a copy of its Smart Fortwo mini car.

In 2004, Chery was accused by General Motors of patent piracy. The previous year, Geely was sued by Toyota for an alleged trademark infringement.

"Domestic carmakers should take quality and intellectual property issues more seriously. Otherwise, their brand image will be ruined, especially in the Western market," Jia says.

Breaking new ground, BYD is betting big on electrical cars to dodge the fierce competition in conventional vehicles. The company says it will put a mid-sized F6 model with a petrol engine as well as rechargeable batteries into commercial production in the second half of next year. It will also start making purely electric cars in 2009.

"Electric cars will be the trump card for us in the global arena. We expect them to account for half of our total sales by 2015," says Xia Zhibing, BYD's sales chief.

According to the company's data, F6 will have a maximum mileage of 400 kilometers and a top speed of 160 kilometers per hour if it uses batteries only.

However, Jia warns BYD's drive to go electric runs a higher risk as the quality and reliability of electric cars are yet to be established and it's not clear how the buyers will accept such cars

American, German and Japanese carmakers take China to Task?

Toyota is the giant of the automotive industry in the world now. For the first time in August 2003, Toyota overtaking General Motors more cars in America than Chrysler becoming the biggest car company in the world, and probably having more than 15% of the world market, its stated aim.

It is the most critical issue for the world automotive industry but many in the American car industry, especially the big three firms General Motors, Ford and Chrysler, have been slow to address and appreciate how serious and the implication the problem really is toward the economy.

Will Toyota prevail? What is the future of Detroit? Can anything be done by American to overcome manufacturer’s competitive disadvantages in model mix, product diversity and the continuous rise in price of new cars? The choice clearly is between shrinking and sinking.

Ironically, the success of Toyota can be seemed from the areas of competitiveness in cost, quality, and products offerings. No company can survive in the global market if they overlook or neglect any of these areas.

No doubt the American automobile manufacturing industry has gone through wrenching times and still the home to the two largest vehicle manufactures in the world, General Motors and Ford which has been responsible for 20 to 25 % of world vehicle production since 1980, but it is declining especially beginning August 2003.

Detroit is steadily and continually losing ground to Japanese. Chrysler realized the scenario and concluded that it could not survive as an independent company under the Japanese attacked, sold out to Daimler-Benz, the giant German car makers of Mercedes.

The ability of American to maintain sustained economic growth and long-term prosperity is clearly seen by adversely affected declining industry. It can be overcome by taking skyrocketing demand China market to task

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At present and in the foreseeable future, automotive demands in developing world are skyrocketing especially heavy populated countries China and India. Demand is expected to be flat or grow slowly in American, Japan and Western Europe.

As the result, the world’s autos companies are looking to the east in gaining sustain economic growth. They are pouring significant investment into China, India and South East Asia. The companies having early status in China are GM, Chrysler, Citroen, Isuzu and Volkswagen.

General Motors invested heavily in China valued in hundred of millions of dollars in China and US $ 1 billion assembly plant in Thailand, whereas Ford spending not less than US $ 1 billion in China and South East Asian. By not left behind, Volkswagen is currently negotiating to joint venture with losing Malaysian Automobile company Proton to capture Malaysian and ASEAN market.

Traditionally, Japanese have huge lead and in the South East Asia market, however significant changes should be expected with the emerging Korean automobile industry especially the fast moving forward Hyundai car maker.

As the differentiation of taste, American consumers are showing a taste for the practical and medium price range vehicles, as embodied in the both top sellers in the medium price range of Toyota Camry and the Ford Taurus. Japanese car makers, however, increase tremendously market share through new strategy by creating luxury nameplates such as Lexus, Acura and Infiniti, besides improving the size and luxurious of Toyota Camry and Honda Accord.

In Korea, India, Thailand, Brazil, Eastern Europe and many other developing countries, the growth rate of sales is by far out paces the traditional consuming markets of Western industrialized Europe, Japan and North America.

Due to skyrocketing oil price and upward trend of fuel, consumers in the developing world are showing a taste for the practical, significantly lower fuel economy, more realistic gas mileage and lower affordable price range vehicles; besides fulfill the domestic demand by “local make” automobile. In additional, by replacing traditional fuel with alternative energies might be is the taste of the large segment of consumers to overcome skyrocketing oil price constraint.

With the emerging of China shown by the foreign exchange reserve reached US $ 1.43 trillion by end of September 2007, all the major players seem to be seeking to strategize global strategies aimed at the developing countries especially China, and this markets will be a critical battlegrounds in the foreseeable future.

VW closes to pact with Proton?

German auto giant Volkswagen is close to forming a pact with Proton with at least an initial 20 percent stake in the loss-making Malaysian car maker, a report said on Sunday.

The Edge business newspaper said Volkswagen would either take the stake in Proton or a new company into which Proton assets would be injected.

"Volkswagen is also seeking management control and will require the government to underwrite any losses at Proton for at least three years," it said.

Malaysian officials could not be reached for comment.

The report comes after reports that Volkswagen boss Martin Winterkorn will visit Malaysia soon to conclude a deal.

The Edge said Volkswagen was waiting for a nod from the Malaysian government to sign the agreement.

Talks between Volkswagen and Proton began in October 2004. Malaysia had already expressed optimism about securing a partnership with Volkswagen.

Malaysian Prime Minister Abdullah Ahmad Badawi said recently that Volkswagen was studying Proton for a possible strategic pact that would help save Malaysia's national carmaker.

For Proton, a deal is expected to boost efforts to reclaim the top spot in Malaysia's domestic car market and help it get a foothold in the lucrative European market.

Proton needs foreign technical expertise to halt a sharp decline in market share and halt a stream of losses, including a 46.75-million ringgit ($13.40 million) loss for the first quarter to June announced recently.

Malaysia hopes that the deal will be wrapped up by the end of the year.-AFP

India People’s Car – Only $2,500

The Indian automaker Tata Motors scheduled to introduce new ultra-affordable small vehicles with a sticker price of about $2,500.

The small-car market in India is dominated by Hyundai Motors India, Tata and Maruti Suzuki. Maruti Suzuki has the models already as low as 195,000 rupees (about $5,000). Renault-Nissan has been talking with local scooter manufacturer Bajaj Auto to build a cheap car cost about $3,000, whereas Hyundai is adding a new small car model and Honda is planning a small car tailored to the Indian market. Fiat stepped up a 50-50 joint venture partnership with Tata.

Read The New York Times full article here

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Car price wars in China

A new bout of price battles broke out in China following Hyundai's price cuts last month.

Hyundai's joint venture with Beijing Automotive Industry Corp slashed prices of the subcompact Accent, the compact Elantra and mid-sized Sonata by 5,000 to 16,000 yuan to buck a downward trend in its sales this year. Will it happen in Malaysia?

Read more….

Car price wars break out

China Daily - Oct 10, 2007 - A new bout of price battles in China's car market, the second-biggest in the world, has broken out following South Korean carmaker Hyundai Motor Co's aggressive price cuts on its locally-made models last month.

Under attack from competition, January-to-August sales at the venture, which also makes the Tucson sports utility vehicle (SUV), plunged 20 percent from a year ago to 146,001 units, ranking eighth in the passenger car sector in China, according to industry data. Hyundai's move has ignited a new round of price wars, which will be "awfully acute" this month, the seasonal peak car sales period in China, analysts said.

Hua Xue, chief executive officer of cheshi.com.cn, a Beijing-based portal tracking nationwide car prices, said: "Other carmakers will have to follow suit to lure increasingly sophisticated Chinese buyers."

As a result, domestic car prices will tumble by as much as 6.5 percent in December from January, a quicker pace than 5.6 percent last year, he said.

Prices in August dropped by 3.6 percent from January due to earlier price contests, he said.

According to market intelligence, Shanghai GM, a tie-up between General Motors Corp and SAIC Motor Co, will possibly launch a major price cut for the compact Buick Excelle - its best seller - to fight against the Hyundai venture.

Analysts said Shanghai GM, the third-biggest passenger car producer in China, will have to cut prices to achieve its lofty 2007 sales target as its growth this year has slowed sharply. Sales in the first eight months hit 294,600 units, up 13.7 percent. The growth rate was 23 percent last year.