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Ford Shift Shows New Power of Car Centers .................................................................................................................
Corporate News: Car Makers Rev Up Production Plans --- Time-Honored Tradition of Summer Shutdowns Falling
Away as Auto Companies Chase New............................................................................................................................7
Corporate News: Ford to End Production In Australia ....................................................................................................9
Corporate News: Former Ford Executives Indicted in Argentina ..................................................................................10
FOR DETROIT AUTOWORKERS, A SHORTER SUMMER SHUTDOWN ..................................................................11
Careers: Ford to Add 200,000 Vehicles to 2013 North American Output .....................................................................12
Eyes on the Road: To Spark Buyers for Electric Cars, Drop the Price to Nearly $0 .....................................................13
Some European Pain Relief for GM and Ford...............................................................................................................15
Tailgate Party: Fire Up the Grilles .................................................................................................................................16
Corporate News: Are Natural-Gas Cars Next? --- Alliance Prepares to Showcase Potential for Shale Boom to Fuel
Passenger Cars.............................................................................................................................................................19
Ford's EcoBoost family takes a hit ; Stalling and power loss complaints could taint important engines .......................21
Pickups: America Falls Back in Love ............................................................................................................................23
Trying to Be Hip and Edgy, Ads Become Offensive ......................................................................................................25
U.S. Car Makers Are Missing in India ...........................................................................................................................27
Corporate News: Chrysler's Jeep Faces Uphill Climb in China --- Auto Maker Plays Catch-Up as It Finds a Partner to
Help Restart Production... .............................................................................................................................................29
Lincoln logs in a nice restart with MKZ ; Sleek, solid-looking with good power, but not without issues ........................31
Joe Wang: Understanding the goal is important ...........................................................................................................34
Japanese Car Makers Lose Their Midsize Edge --- After Closing Quality Gap, Ford Fusion, Hyundai Sonata, VW
Passat, Others Pose Real Challenge ............................................................................................................................35
Corporate News: Pickups Steer U.S. Auto Sales --- Detroit Car Makers Collect Double-Digit Gains as Industry
Volume Climbs 8.5% .....................................................................................................................................................37
Ahead of the Tape .........................................................................................................................................................39
Companies Feel Pinch On Sales In Europe ..................................................................................................................41
The Secret Ingredient Is Ford Fusion ............................................................................................................................43
A Troubled Introduction for a Crucial New Model..........................................................................................................45
Autos: Ford Thrives at Home, Drags in Europe ............................................................................................................47
Autos: Europe Woes Dent Car Makers --- Profits at Volkswagen, Daimler and Others Hit by Region's Sluggish
Markets..........................................................................................................................................................................49
North American Sales Lift Ford's Results......................................................................................................................51
CFO Journal: The Big Number ......................................................................................................................................53
Ford-G.M. Teamwork On Transmissions ......................................................................................................................54

Page 1 of 194 © 2020 Factiva, Inc. All rights reserved.
Home & Digital -- Eyes on the Road: Changing Gears: Cars Ditch Familiar Shift Levers.............................................56
GM, Ford team to develop 10-speed transmissions ; Teamwork saves money............................................................58
Corporate News: Ford CEO Revs Up Auto Maker's China Role --- Behind Rivals in the World's Largest Car Market,
Company Is Making a $5 Billion... .................................................................................................................................60
Corporate News: GM, Ford Team Up on New Transmissions ......................................................................................62
Calling on a higher power ; Fusion Energi plug-in hybrid goes 21 miles on battery......................................................63
Who rules the world? Ford Focus, that's who ; For second year in a row, it's the global car sales champ...................65
The 97-Month Car Loan ................................................................................................................................................67
Police Car Company Abandons Offices ........................................................................................................................69
Automakers pick up speed after long slog ....................................................................................................................71
Corporate News: Battery Fires Fail To Rattle Car Makers ............................................................................................74
Corporate News: U.S. New-Car Sales Climb Sharply --- American Firms' Gains Outstrip Japan's Big Three .............76
Corporate News: GM Ups Ante in Truck Rivalry --- Auto Maker Claims Its New Pickups, Coming Out in June, Will
Best the Gas Mileage of Ford's... ..................................................................................................................................78
Another Sport Franchise for Ford ..................................................................................................................................80
Lawsuit alleges older Fords susceptible to sudden acceleration ..................................................................................82
Corporate News: Auto Makers Try to Tackle Inaccuracies Measuring MPG ................................................................84
3-D printers wave their magic wands ; Dream up a doodad, hit 'M' for make, and presto ............................................86
Detroit: Lean Into Car-Market Turn ...............................................................................................................................89
A Chase Car to Lure Private Eyes Out of Retirement ...................................................................................................91
Corporate News: Ford Boss's 2012 Pay: $21 Million ....................................................................................................93
Employers Blast Fees From New Health Law ...............................................................................................................94
Shelby Focus ST hopes to earn its stripes ; Company goes mainstream with first performance touches on a small car
in nearly 30 years ..........................................................................................................................................................97
Big Data (A Special Report) --- Drive Into the Future: Your car knows a lot about you; And it's talking .......................99
Detroit Metal Largely Absent At Swiss Show ..............................................................................................................101
Toyota's Bottom Feeder Finally Makes Some Waves.................................................................................................102
Ford Recalling Minivans For Corrosion Problem.........................................................................................................104
Ford Foundation Head Steps Down ............................................................................................................................106
Corporate News: Car Sales Rise but at a Slower Pace ..............................................................................................107
A High-Dollar Debutante Ball ......................................................................................................................................109
Ahead of the Tape .......................................................................................................................................................111
Motor homes takin' it to the streets once more ; Hard-hit industry on the road again .................................................113
Partial engine power loss hits some Fords ; Feds open early probe of problem.........................................................116

CFO Journal: Why the Pension Gap Is Soaring --- Companies Struggle to Get Handle on Liabilities as Low Rates,
Other Forces Inflate Funding.......................................................................................................................................117
A Hatch Marinated in Hot Sauce .................................................................................................................................119
Sign of a Comeback: U.S. Carmakers Are Hiring .......................................................................................................121
Corporate News: Lexus, Porsche Top Quality Survey ................................................................................................123
The few, the proud, the female engineer ; Meet the women moving car industry.......................................................125
Eyes on the Road: Five New Technologies To Make Driving Easier ..........................................................................128
Companies Fret Over Uncertain Outlook ....................................................................................................................130
Ford to Sell Plug-Ins At More Dealerships ..................................................................................................................132
Toyota beefs up Tundra for a fight ; Watch out, Detroit, new truck's meatier, more luxurious, too .............................133
Apple's New Normal ....................................................................................................................................................135
Low Rates Force Companies To Pour Cash Into Pensions ........................................................................................137
Automakers Join Forces On Fuel-Cell Cars ................................................................................................................140
Europe's Car Woes Damp 2013 Outlook ....................................................................................................................142
Eyes on the Road: Why Your Car's Mileage May Not Always Measure Up................................................................144
Ford extends profit streak despite big Europe loss .....................................................................................................146
Corporate News: The Motor City Is Back in the Money --- Auto Firms Expect to Report Billions of Dollars in 2012
Profits, as Well as........................................................................................................................................................147
Toyota Takes Sales Crown .........................................................................................................................................149
Corporate Watch .........................................................................................................................................................151
Ahead of the Tape .......................................................................................................................................................153
Start-ups give new life to empty auto plants ; Entrepreneurs see potential ................................................................155
EARNINGS SEASON ; RESULTS STILL UPBEAT ....................................................................................................158
Any Engine You Like, But Only if It's a Hybrid.............................................................................................................159
Cross Country: The Motor City Roars Out of Washington's Shadow ..........................................................................162
OFF DUTY --- Gear & Gadgets -- Rumble Seat: Ford Fusion: Passion Seizes the Family Sedan .............................164
Two Men Who Bet Big on 787 --- Boeing's Jim McNerney and Alan Mulally, Now at Ford, Pushed for the Dreamliner ..
167
Home & Digital -- Eyes on the Road: How Auto Makers Keep You Coming Back......................................................170
New Era for European Autos.......................................................................................................................................172
Eyes on the Road: Would You Drive This Car? --- Auto Makers Unveil New Concept Cars; Corolla Tries to Shed its
Dowdy Image ..............................................................................................................................................................173
Detroit Auto Show: Denso Set To Expand American Operations ...............................................................................175
Detroit Auto Show: Mercedes, BMW Shift to Young Buyers --- Small Luxury Cars Target Ford, Honda....................176
VC Dispatch / U.S. Venture-Capital Financings ..........................................................................................................178

Detroit Auto Show: Honda Recovers In China ............................................................................................................180
Detroit Sheds Pounds For Gas-Mileage Gains ...........................................................................................................181
Industry's New Year Buffet: Entrees and a Few Desserts...........................................................................................183
A Glimpse Into the Future of Parking ..........................................................................................................................185
Ford Plans To Hire 2,200 Salaried Workers In U.S.....................................................................................................187
For Sale: Used Ford, Careful Owner ...........................................................................................................................188
Story stocks .................................................................................................................................................................189
Corporate News: Nissan to Build Lower-Cost Leaf Electric Car in U.S.......................................................................190
Japan's Autos Need Repair in China...........................................................................................................................191
Corporate News: Japan's Car Makers Perk Up --- Sales Look Poised to Recover From Protests in China, Subsidy
Expiration at Home ......................................................................................................................................................193

Ford Shift Shows New Power of Car Centers
Ford Shift Shows New Power of Car Centers

By Enda Curran
858 words
24 May 2013
The Wall Street Journal
J
B1
English
(Copyright (c) 2013, Dow Jones & Company, Inc.)
Ford Motor Co. is planning to end all production at two factories in Australia by 2016, a move that reflects the
broader movement of the auto industry's center of gravity from traditional locations to new, emerging markets like
China.
The auto maker said it would end 90 years of car production in Australia in October 2016, resulting in 1,200 job
losses. It cited unsustainably high business costs, with wages singled out as a particular concern.
"The business case simply didn't stack up," Ford Australia's Chief Executive Bob Graziano said. "Our costs are
double that of Europe and nearly four times Ford in Asia."
Ford is pulling out of Australia at the same time that it is closing plants in Europe, another region that has become
unattractive for auto production because of high costs and stagnant economies. The company last fall said it
would close assembly plants in Belgium and the U.K.
Meanwhile, Ford and other auto makers are scrambling to add plants in markets where auto sales are expanding
rapidly and labor costs are low. In China, Ford is spending $5 billion to open four new plants with a joint-venture
partner over the next several years.
It also is expanding output in India, Thailand and Russia.
Many other auto makers are following the same path. General Motors Co. and Volkswagen AG are spending
billions of dollars to add new plants in China. GM is closing a car assembly factory in Germany to reduce output in
Europe.
The moves are part of a broader re-ordering of the global auto industry that began a decade ago. For a century,
the vast majority of world's cars were made in U.S., Europe or Japan. Australia was a secondary location where
Ford and GM built up operations to supply its domestic market. Some cars made in Australia also were exported
to countries in Asia that were less developed.
But the opening of emerging new markets like China and Russia offered the auto makers opportunities for rapid
and sustained growth, and set off a shift. As new centers of auto production rise in these emerging markets, less
competitive regions like Europe and Japan have been declining slowly.
China has surpassed the U.S. as the world's largest car market by sales. In 2012, China produced 19 million
vehicles, nine million more than the U.S. and more than twice the combined output of Germany, France and the
U.K.
Japan was once the world's largest producer of vehicles, but its auto makers have been trimming domestic
production because the strength of the yen has made it harder to make money on cars exported from Japan. The
country's aging and declining population also has caused auto sales in Japan to decline for several years.
Unlike Europe and Japan, the U.S. has remained competitive in this re-ordering, in part because labor costs were
cut in restructurings that accompanied the 2008-09 recession. Since then, Toyota Motor Corp. and Honda Motor
Co. have been expanding production in the U.S. to export vehicles to markets in Asia, Europe and the Middle
East.
Last year Ford closed a plant in the Philippines that had been making the Escape sport-utility vehicle. Meanwhile
its Thai operations make the Focus, Ranger and Fiesta. Ford opened a second assembly plant in Thailand in
2012 that makes the Focus and can easily be expanded to make far more than the 150,000 units it can currently
produce.
The closing of Ford's plants in Australia and the loss of jobs is a setback for a government that has invested
heavily in propping up the country's auto industry. Ford said its Australian unit's losses over the past five years
totaled 600 million Australian dollars (US$581.1 million). It produced 37,000 vehicles in the country last year.
GM's Australian unit last month said it would cut 500 jobs -- about 12% of its workforce -- citing pressure from the
nation's strong currency.
The difficulties facing car makers are reflected across the nation's manufacturing industry, which is battling
pressures, including a strong Australian dollar that in recent years has traded above parity with the U.S. dollar,
making exports less competitive and driving up costs for overseas-based companies.
The decline in manufacturing is presenting a challenge for the government, which has been trying to shift the
economy away from its reliance on the natural resources sector that has powered growth for the past decade.
Australia's manufacturing industry employs close to 1 million people, some 50,000 of whom are involved in the
auto sector, government figures show.
Ford said Thursday it would end production at Geelong and at a facility in Broadmeadows, where it makes the
Falcon sedan and the Territory SUV.
Ford Australia will continue to employ about 1,500 local staff in research and design, the company said.
---
Neal E. Boudette, James Glynn, Robb M. Stewart and Mike Ramsey contributed to this article.
License this article from Dow Jones Reprint Service
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Corporate News: Car Makers Rev Up Production Plans --- Time-Honored Tradition of Summer Shutdowns Falling Away as Auto Companies Chase New...
Corporate News: Car Makers Rev Up Production Plans --- Time-Honored Tradition of Summer Shutdowns
Falling Away as Auto Companies Chase New Demand
By Jeff Bennett and Christina Rogers
710 words
23 May 2013
J
B3
English
U.S. auto makers are accelerating production lines and, in some cases, even canceling the North American
industry's traditional summer factory shutdowns to meet strong demand.
The plans highlight the Detroit Three auto maker's recent market share gains against Japanese rivals and the
auto industry's prime position in the U.S. economic recovery. Car sales have roared ahead this year even as retail
spending on clothing and other goods remains tepid.
General Motors Co., Ford Motor Co. and Chrysler Group LLC are running their factories at full tilt amid continued
sales increases. Annualized U.S. automotive sales reached a 14.9 million vehicle pace in April. Auto executives
expect U.S. sales for all of 2013 to reach 15 million vehicles, above last year's 14.5 million mark.
Detroit brands have made strong market share gains this year. They held 45.9.% of the U.S. market year-to-date
through April, exceeding the 44.9% share of Japanese and South Korean auto makers. A year ago, the U.S. was
at 44.4% while Asian auto makers had 46.3%.
"The Japanese can feel the hot breath on the back of their necks from the Detroit Three and they don't like it,"
said Morgan Stanley auto analyst Adam Jonas. He predicts that Detroit's gains will provoke "more aggressive
lending from the Japanese."
Historically summer shutdowns let U.S. auto makers slim inventories and focus worker vacations during July. The
plant closings also allowed companies to do everything from installing new production machines to remodeling
and painting factories.
Not this year. GM said it would have no companywide shutdowns for the first time since 2008. The largest U.S.
auto maker will move or delay the production halts on an as-needed basis. For example, there is no July summer
break scheduled for the Lansing, Mich., Grand River Assembly plant, where the company builds Cadillac ATS
and CTS models. Production may be idled for two weeks later in the year.
GM North America President Mark Reuss said the company is doing away with the universal production halts
because of its extensive slate of new model introductions. GM plans to introduce 23 new vehicles this year.
"What we bring up and down really depends on the car or truck program," Mr. Reuss said in an interview this
week. "There won't be a hard shutdown time at all."
Ford plans to reduce its usual production halt to one week at six of its North American assembly plants. The extra
week of production would add 40,000 extra vehicles to production, helping it increase North American
manufacturing capacity by 200,000 vehicles this year.
Chrysler said three of its 10 North American assembly plants won't have a summer shutdown and four others will
take just a one-week break. All of its engines, transmission and stamping plants, with the exception of one, will
work through the summer, Chrysler said.
Gabe Solano, president of UAW local 372, which represents workers at Chrysler's engine plant in Trenton, Mich.,
said this is the second year in a row that employees at the plant worked through the summer shutdown.

"Trust me, it's not a complaint," Mr. Solano said. "From where we were coming out of bankruptcy, this is good for
us. Several years ago, we were facing a permanent summer shutdown." Workers typically were required to take
vacations during the summer plant closings.
Skipping summer shutdown is a risk if this year's sales don't meet expectations and auto makers end up with too
high inventories. But the extra production would boost revenue. Auto makers book revenue when a vehicle is
shipped to a dealer.
The U.S. companies have been buoyed by strong demand for cars and trucks. "We are in the middle of a bull
market and as housing comes back and bank lending improves, we do expect U.S. auto sales to finish in the high
15 million range this year," said Morgan Stanley's Mr. Jonas.
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Corporate News: Ford to End Production In Australia
Corporate News: Ford to End Production In Australia

By Enda Curran and James Glynn
152 words
23 May 2013
J
B3
English
SYDNEY -- Ford Motor Co. said it would stop producing cars in Australia in 2016, foreshadowing hefty job losses,
in a setback for a government that is invested heavily in propping up the country's automobile industry.
The U.S. company said it would shut down its Australian plants in October 2016, with the loss of 1,200 jobs, citing
unsustainably high business costs.
"The business case didn't stack up," Ford Australia's chief executive, Bob Graziano, said in a televised statement
Thursday.
The announcement comes amid the dwindling popularity of some of Ford's locally produced cars that have
progressively lost business to cars from Japan and elsewhere. General Motors Co.'s Australian unit last month
said it was cutting 500 jobs, or about 12% of its local workforce.
Document J000000020130523e95n0003r

Corporate News: Former Ford Executives Indicted in Argentina
Corporate News: Former Ford Executives Indicted in Argentina

By Ken Parks
321 words
23 May 2013
J
B3
English
BUENOS AIRES -- A federal court in Argentina has indicted three former executives of Ford Motor Co.'s
Argentine subsidiary for their alleged involvement in the kidnapping of 24 workers by the military government that
ruled between 1976 and 1983.
The three men were charged Tuesday with helping the military to identify the victims, who were abducted
between March and August of 1976, according to a ruling by federal judge Alicia Vence.
The judge also accused the defendants of allowing the military to establish an interrogation center at the Ford
factory, where some of the victims were subjected to beatings. The workers were tortured and briefly imprisoned,
she said in her decision. .
Ford Argentina's former head of manufacturing, Pedro Muller, former labor-relations director, Guillermo
Galarraga, and ex-chief of security, Hector Jesus Sibilla, were named as defendants in the case. They couldn't
immediately be reached for comment.
Judge Vence ordered the defendants to post bond of 750,000 pesos ($143,000) each.
Ford Argentina isn't a party in the case, but is aware of the criminal charges filed against its former executives
and is collaborating with Argentine authorities, a company spokesman said.
The violence of the 1970s and early 1980s continues to haunt Argentina three decades after the country's return
to democracy. In its battle with left-wing insurgents and persecution of trade union leaders, political activists and
opponents, the military government is thought to have killed at least 10,000 people. Insurgents are also thought to
have killed hundreds of civilians, police officers and members of the armed forces.
Argentina's current president, Cristina Kirchner, and her late husband and predecessor, Nestor Kirchner, gained
international fame for their attempts to prosecute human-rights abuses committed by the military and security
forces.
---
Shane Romig contributed to this article.
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FOR DETROIT AUTOWORKERS, A SHORTER SUMMER SHUTDOWN
MONEY
FOR DETROIT AUTOWORKERS, A SHORTER SUMMER SHUTDOWN
278 words
22 May 2013
USA Today (Newspaper)
USAT
FINAL
B.1
English
© 2013 USA Today. Provided by ProQuest Information and Learning. All Rights Reserved.
Ford, General Motors and Chrysler are forgoing their usual two- week summer shutdown and speeding up
production to meet growing demand for cars and trucks, the Associated Press reports. Ford says 21 of its North
American factories will shut for only one week this summer. GM won't idle its factories at all, and Chrysler plans
two- week closings at only four of its 10 North American assembly plants. U.S. demand for new cars and trucks
was up 7% through April this year.
BACK IN COURT
FORMER GOLDMAN DIRECTOR APPEALS CONVICTION
Rajat Gupta, a former Goldman Sachs director and McKinsey & Co. managing partner, is asking a federal
appeals court to overturn his insider trading conviction and give him a new trial. Gupta's lawyer argues that
prosecutors should not have been able to use at his trial secretly wiretapped calls in which he wasn't a participant.
Gupta has been sentenced to two years in prison, but the same appeals court has ruled he can remain free while
he fights his conviction.
PAYPAL'S AMBITION:
2 MILLION STORES THIS YEAR
Paying for store purchases on a smartphone could get easier by year's end as EBay's PayPal service steps up its
competition with Square and Intuit in the growing market for mobile payment systems. PayPal aims to be in 2
million stores this year, up from 250,000 stores in April. It has signed up RadioShack and expects to announce
more partnerships, the company says. PayPal is promoting a credit card reader to expand its payments service
beyond e-mail transactions for online purchases.
photo Bloomberg News

Document USAT000020130522e95m00030

Careers: Ford to Add 200,000 Vehicles to 2013 North American Output
Careers: Ford to Add 200,000 Vehicles to 2013 North American Output

By Mike Ramsey
348 words
22 May 2013
J
B6
English
Ford Motor Co. plans to increase its North American manufacturing capacity by 200,000 vehicles in 2013 through
production-line expansions and a shortening of its normal summer shutdown by a week at several plants.
The Dearborn, Mich., auto maker won't say what its total capacity is, but the company built 2.8 million vehicles in
the region last year and was working near full capacity.
Ford will reduce its normal summer shutdown to one week from two at most of its North American plants. That will
add 40,000 units of capacity, the company said. Also, it plans to speed up production at other plants.
Ford recently said it would add a third shift to its Kansas City, Mo., F-150 pickup truck plant, adding 900 workers.
It also is adding a shift of workers to an assembly plant near Detroit that will make the Fusion sedan as well as
the Mustang.
After spending years closing plants and battling with its U.S. unions to get cost-savings, Ford is adding back
production and is running at nearly full capacity, said Jim Tetreault, Ford's North American manufacturing chief.
"We have three-quarters of our plants running on three crews," Mr. Tetreault said. Three shifts at a plant is
considered beyond "full capacity," which typically is two shifts running 40 hours a week. Going around the clock
makes plants more efficient and profitable.
Ford had first-quarter pretax earnings in North America of $2.44 billion and has gained market share in 2013 as
sales jumped 13% through April over the same period last year.
"If you went back 10 years ago when we had close to 20 assembly plants, a lot of them were running on one or
two shifts," he said. "Today, we have 11 plants in North America and they are all running at much greater than the
standard full capacity."
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Document J000000020130522e95m0003s

Eyes on the Road: To Spark Buyers for Electric Cars, Drop the Price to Nearly $0
Eyes on the Road: To Spark Buyers for Electric Cars, Drop the Price to Nearly $0
By Joseph B. White
1,143 words
22 May 2013
J
D1
English
This car deal sounds too good to be true: Drive a car, almost free.
To entice drivers to try electric-powered cars, auto makers are lowering the price of entry to the zero-emission
lifestyle.
A new round of discount leases on mainstream-brand plug-in cars such as the Nissan Leaf or Fiat 500e,
combined with federal, state and local electric-vehicle incentives, could make a battery-electric car an
extraordinarily economical way to get around for drivers. There are two big caveats: Drivers need to live in states
offering tax incentives and can't drive very far in a single day.
Electric cars are still a long way from achieving mass appeal. Plug-in cars accounted for less than 1% of total
vehicle sales in the U.S. during the first four months of this year, according to data compiled by the website
hybridcars.com. But the flurry of discounts and public subsidies has more consumers refiguring the math. Plug-in
sales more than doubled in the first four months of 2013 compared with a year earlier.
Bronson Beisel, 46, says he was looking last fall for an alternative to driving his gas-guzzling Ford Expedition
sport utility around suburban Atlanta, when he saw a discounted lease offer for an all-electric Nissan Leaf. With
$1,000 down, Mr. Beisel says he got a two-year lease for total out-of-pocket payments of $7,009, a deal that
reflects a $7,500 federal tax credit.
As a resident of Georgia, Mr. Beisel is also eligible for a $5,000 subsidy from the state government. Now, he
says, his out-of-pocket costs for 24 months in the Leaf are just over $2,000. Factor in the $200 a month he
reckons he isn't paying for gasoline to fill up his hulking SUV, and Mr. Beisel says "suddenly the car puts $2,000
in my pocket."
Yes, he pays for electricity to charge the Leaf's 24-kilowatt-hour battery --but not much. "In March, I spent $14.94
to charge the car" and a bit less than that in April, he says. He also got an electric car-charging station installed at
his house for no upfront cost.
"It's like a two-year test drive, free," he says.
Mr. Beisel works for IBM designing presentations that company sales representatives use to convince clients
they'll save money investing in new technology. He says he did a similar analysis on his family's lifestyle and
concluded that the Leaf's 73-mile range was plenty for most of his everyday driving.
About 28 states offer incentives for buying electric vehicles, according to information compiled by Plug In
America, an electric-car-advocacy group. These range from lower registration fees or free parking to breaks on
sales taxes or tax credits.
Auto makers are under mounting state regulatory pressure in about a dozen states to accelerate electric-car
sales. California greenhouse-gas rules, for instance, require that, by 2018, some 4.5% of the cars major auto
makers sell in the state be "zero-emission" vehicles -- that is, no emissions from the car. By 2025, California's
rules mandate that electric cars account for more than 15% of sales in the state. The Obama administration has
backed the California mandate, although it didn't order similar targets nationwide.
Only two electric cars, the Nissan Leaf and the Tesla Model S, sold more than 1,000 vehicles in the first quarter,
according to hybridcars.com. By comparison, Ford Motor Co. sold more than 2,000 of its plus-size F-Series
pickup trucks a day in March.
Car makers are lobbying the federal government to block the California mandate. But some are also boosting
efforts to convince more people that electric cars make sense. One reason: Selling more high-mileage cars allows
them to sell greater numbers of larger, more profitable vehicles, under the complex government
emission-regulation schemes.
Nissan Motor Corp., the mass-market car maker most heavily invested in electric transportation, is accelerating
production of the Leaf and its costly lithium-ion battery packs at factories in Tennessee, replacing cars shipped
from Japan. That made it possible to drop the starting price of the least-expensive 2013 Leaf to $28,800, down
$6,400 from 2012, company officials say.
Nissan has begun offering leases as low as $199 a month for three years, or no-interest, three-year loans for
customers who prefer to buy the car. For 2013, the Leaf gets an enhanced warranty on the battery, a faster
charger (cutting time from seven hours to four when plugged into a 220-volt circuit) and new options such as
leather seats.
Matt Brooks, a software engineer in Rochester, N.Y., says he decided to replace a hybrid Prius with a Leaf
because the lease was so cheap. He's paying $239 a month for 24 months with no money down. Mr. Brooks says
he likes the car, but doesn't expect to buy it when the lease is done. Used Leafs are selling below the purchase
price written into his lease, he says.
Electric-car makers are also experimenting with new responses to the problem of "range anxiety." That's the fear
would-be buyers have of getting stranded should the battery run down faster than advertised.
Luxury electric-car maker Tesla Motors Inc., which recently rolled out a lease-like financing option, has models
rated as high as 265 miles on a charge, and a growing line of dedicated fast-charging stations. But its Model S
sedans start at $62,400 after the $7,500 federal tax credit.
Among less expensive solutions, Nissan engineered the 2013 Leaf with a new range-extending drive mode the
company says can increase the distance it can travel on a single charge by up to 15%, to 84 miles, by allowing
the customer to choose to use up 100% of the energy stored in the battery. The government takes a more
conservative view, crediting the 2013 Leaf with a 75-mile range. It is also stepping up efforts to persuade
employers and local governments to install more charging stations.
Fiat SpA's U.S. sales arm is offering 12 days of free annual access to a gasoline rental car, for long-distance trips,
as part of the cost of its new 500e electric (starting price: $32,500). Matt Davis of Fiat USA says the rental-car
offer grew out of brainstorming sessions where company officials debated how to deal with the car's 87-mile
range. "We have nothing to overcome that," he says.
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Some European Pain Relief for GM and Ford
Heard on the Street

Some European Pain Relief for GM and Ford
By Justin Lahart
338 words
21 May 2013
J
C10
English
[Financial Analysis and Commentary]
Europe's woeful car market remains a sore spot for Ford Motor and General Motors. But the good news, of sorts,
is that it doesn't look like it is going to get any sorer.
The European Automobile Manufacturers' Association says that new passenger-car registrations in the European
Union rose 1.7% year over year in April -- the first such increase since September 2011. Given that April
benefited from an extra two selling days, that is hardly a reason to party -- especially as registrations still were
about 25% below their level of five years ago.
But the figures suggest European car sales aren't going to get materially worse. That jibes with economists'
forecasts that the region will start generating growth this quarter, albeit weak, exiting from the recession that
began in late 2011.
If a bottom is forming, it makes Ford and GM shares less risky. Over the past two years, both companies made
big improvements to their North American operations. But investors have remained wary of the stocks because of
Europe's capacity to generate losses -- and the seemingly endless parade of euro-zone crises.
Even after this year's gains, both companies' share prices are only slightly higher than they were two years ago.
Both have looked cheaper in the past. In May 2011, Ford's stock traded at 7.6 times the next year's expected
earnings, according to FactSet. Its multiple today is 10.1 times. Meanwhile, GM's went to 9 times from 7.1 times
in that period.
But analysts' forecasts in 2011 reflected expectations Europe wouldn't get as bad as it did, making the stocks
seem cheaper than they were. With the scope of their European woes now better defined, the companies' stocks
might not be as richly valued as they seem.
Document J000000020130521e95l0001h

Tailgate Party: Fire Up the Grilles
DESIGN
Automobiles; SECTAU
Tailgate Party: Fire Up the Grilles
By PHIL PATTON
1,592 words
19 May 2013
The New York Times
NYTF
Late Edition - Final
1
English
Copyright 2013 The New York Times Company. All Rights Reserved.
The look of its pickup trucks is so important that General Motors put its best man on the job: the guy who does the
Corvettes. Fresh from the task of designing the 2014 Stingray, Tom Peters took on the task of freshening up --
and toughening up -- the Chevrolet Silverado and its fraternal twin, the GMC Sierra.
''A fist in the wind'' is how Mr. Peters describes the pickups' design.
The new G.M. trucks are not alone in looking as if they can deliver a punch. The latest full-size pickups from
G.M.'s crosstown rivals, Ford and Ram, step into the ring with flattened noses, their huge, blunt grilles often
slathered in bright trim. A special edition of the latest Toyota Tundra seems to have as many bars as Milwaukee,
capped with a flat, wide nostril.
''There is a trend toward a bigger, bolder look,'' said Mr. Peters, the director of exterior design for Chevrolet
trucks, full-size crossovers and performance cars.
Automobile grilles have long been carefully created to reflect the image of their brands and a particular model's
place in the hierarchy, while truck grilles were comparatively bare and basic. But with trucks locked in ever-fiercer
sales battles, their grilles have grown larger and more eye-catching, a modern, motorized riff on the battle shields
of medieval crusaders.
After taking a hit when the economy slumped, pickup sales are on the rise again on the strength of a rebounding
construction industry: Ram (previously known as Dodge Trucks) gained 49 percent in April from a year earlier,
and the full-size truck sales of G.M. and Ford each rose around 24 percent.
Manufacturers are scrambling to grab larger shares of this highly profitable market with tougher, more distinctive
designs.
Rugged exteriors help to hide the fact that many of today's macho-looking trucks are softies on the inside, with
interiors wrapped in soft leather, decked with wood trim and buzzing with electronic gadgets.
Luxury trucks are especially hot. Ford says that about a third of its pickup sales come from the higher-end
versions priced at $35,000 or more. Not long ago, a $50,000 pickup seemed unimaginable. Now the price tags on
fancy trucks can rise well above $60,000.
In addition, a tough grille can obscure the fact that the power plant behind it is shrinking -- with more fuel-efficient
V-6 engines replacing thirsty V-8s in many pickup trucks.
In Texas, where one-sixth of the nation's pickups are sold, and where Mr. Peters showed off his new truck to the
press recently, pickups are like the standard uniform of boots and cowboy hats: they are everywhere, but they
come in many styles and shapes. Greater personalization, with a variety of available faces, is the latest truck
trend.
The image of the pickup truck is firmly wrapped in American mythology. Model names read like the listings for
John Wayne Week on the Turner Classic Movies channel: High Country, King Ranch, Laramie Longhorn.

Manufacturers present trucks primarily as work tools, but despite the ads featuring cowboys, farmers and
construction workers, more and more trucks are being used partly -- or mostly -- as family vehicles.
''There's a lot of diversity in the customer range,'' said Joe Dehner, chief exterior designer for Ram and Dodge. In
addition to working trucks, he said, ''we also get the 'air haulers,' which means they don't necessarily carry
something.''
For decades, trucks looked like basic metal boxes. Then Dodge offered up a bold new look for its Ram for the
1994 model year. Under Tom Gale, then the design chief for Chrysler, the pickup added a touch of fantasy to the
utilitarian box. With its arched grille and raised hood, the Ram resembled the cab of a mighty 18-wheeler.
Today's Ram designers call it ''the big-rig look,'' said Mr. Dehner. ''We own that.''
But pickups from other manufacturers began to show the Ram's influence as their designers visually separated
the hood and fenders and raised the grille above the headlights.
For the 2014 Chevy Silverado, which will arrive in showrooms soon, Mr. Peters has revised a familiar look. Bolder
elements surround its traditional so-called dual port grille. Mr. Peters said, ''It looks tougher because it is taller and
wider and sports a new single-piece bumper that emphasizes its horizontality.'' He said that drivers want trucks
''to be purposeful, capable, durable, with an aggressive appearance saying that they can take the punches of
everyday life on the farm or job.''
The perennial best-selling pickup, the Ford F-150, was last redesigned for 2009. But today's F-150 wears many
faces: depending on the model or trim level, the grille has multiple small bars or large planks of chrome along with
different shapes and colors of meshlike patterns.
The Atlas concept truck, unveiled in January at the Detroit auto show, appears to borrow the muscular look of
Ford's Super Duty line of larger, more powerful pickups. The Atlas is believed to foreshadow the design of the
next-generation F-150, expected next year.
The face of the Atlas adds vertical elements to the horizontal bars of the current F-150. The grille's frame forms a
shape that suggests the nostrils of a bull.
Toyota's new design for its big Tundra truck, first displayed at the Chicago auto show in February, was devised at
the Calty design studio in California. The Tundra's grille frame has also been enlarged and its designers, too, use
words like bold, chiseled and tough.
In one sign of how much truck grilles have grown, the Nissan Titan's, which seemed notably aggressive when the
truck made its debut as a 2004 model, looks relatively undersized in comparison with the newer designs of its
rivals.
Grilles play a critical role in differentiating the many submodels and trim levels of today's trucks. ''It is almost
mind-boggling how complex the choices have become,'' Mr. Peters said.
Ford offers a huge choice of variants with its F-150, visually distinguishing a range from base models to King
Ranch and Harley-Davidson editions, Special and Platinum luxury versions and the high-performance SVT
Raptor, with huge letters molded into a black front end that Ford calls a ''brick wall grille.''
Mr. Dehner, the Ram designer, said: ''There has been an explosion of different textures and finishes, not just in
the grilles but with colors, wheels and trim packages. People want their vehicle to be customizable. It goes from
the country to the urban cowboy and, if you will, the city slicker type. We want to be specific to their needs.''
The Ram 1500 comes in nine trim levels and offers four basic types of grille mesh. There is a ''hex-link'' design on
the Tradesman, Express and SLT models, with six-sided cells that provide ''the metaphor of the bolt head,'' Mr.
Dehner said. The upscale Laramie has a similar ''hex-perf'' grille, in chrome.
Then there are two versions of ''billet-perf'' on the Big Horn and Sport. ''It goes with a monochromatic look, big
wheels, a hot-rod look,'' he said.
The top-of-the-line Laramie Longhorn offers ''wave-mesh'' texture, a diamond wire pattern that dates to sports
cars of the 1920s. ''It is an adaptation of the wire mesh grilles on upscale sport utilities,'' Mr. Dehner said.

Aerodynamics, surprisingly, may be behind some of the rugged, angular faces of trucks. As boxy as they look, all
the trucks are carefully tested in wind tunnels. The fist in the wind must be streamlined: Chevrolet says it has cut
aerodynamic drag by 5 percent from the previous Silverado.
''Sometimes the design goes against what you assume is good for aero,'' said Gordon Platto of Ford, who
directed the design of the Atlas concept truck. Crisp, clean lines on the sides and rear of a truck reduce drag. But
in front, the Atlas has adjustable grille shutters, which close at higher speeds to reduce drag. The Ram trucks
already have such a system, as do some passenger cars.
Ford engineers and designers have also devised a lower air dam for the Atlas as well as wheel-well shutters to
direct air under the truck to reduce drag.
For all their work, designers can be frustrated. The Ram designers are proud that they have increased their share
of the market, but they also admit that they keep running up against the limits of design to entice new customers.
Truck buyers are famously loyal to their brands. Many Ford owners would no sooner jump to Chevy or Ram than
change their political parties or shift their football allegiance from the Oklahoma Sooners to the Texas Longhorns.
BLUNT FORCE DRAMA: The latest crop of pickup trucks get in your face with the subtlety of a battering ram.
Clockwise from top left, Ford's Atlas concept truck, the 2014 Chevrolet Silverado LTZ, the 2014 Toyota Tundra
1794 Edition and the 2013 Ram 1500 Big Horn. (PHOTOGRAPHS BY BENJAMIN NORMAN FOR THE NEW
YORK TIMES; GENERAL MOTORS; TOYOTA MOTOR SALES) (AU1); NEEDING NO INTRODUCTION: Top
row, a few of the multiple grilles available on Ford's lineup of 2013 pickups. From left, the F-150 XLT, the F-150
SVT Raptor and the F-350 Super Duty. Above, the Nissan Titan reflects an older sensibility. (PHOTOGRAPHS
BY BENJAMIN NORMAN FOR THE NEW YORK TIMES) (AU5)
Document NYTF000020130519e95j00038

Corporate News: Are Natural-Gas Cars Next? --- Alliance Prepares to Showcase Potential for Shale Boom to Fuel Passenger Cars
Corporate News: Are Natural-Gas Cars Next? --- Alliance Prepares to Showcase Potential for Shale Boom
to Fuel Passenger Cars
By Chester Dawson
690 words
18 May 2013
J
B4
English
CALGARY -- A consortium of North American energy producers plans to showcase half a dozen
natural-gas-powered vehicles, including a BMW X3 SUV and a Ford Mustang coupe, in an effort to drum up
interest in use of the fuel in passenger cars.
America's Natural Gas Alliance, a trade group representing more than two dozen North American oil and gas
companies, is planning to demonstrate "bi-fuel" versions of popular vehicles retrofitted to run on compressed
natural gas, or CNG, and use a conventional gasoline tank to extend their range, according to officials. The group
declined to provide further details ahead of its marketing campaign.
The trade group will preview those test vehicles on Tuesday at a Southern California Gas Co. facility in Los
Angeles and then launch a broader public-awareness campaign next month, officials said. Converted vehicles
from Ford Motor Co., Chrysler Group LLC and four other manufacturers are expected to be part of the Alliance's
lineup.
Chrysler, which now offers a natural-gas-powered pickup inspired by the shale-gas boom, said it has no plans to
make a passenger-car conversion available. Auto makers have been focusing on battery- and diesel-powered
passenger vehicles and have been reluctant to add another energy source. A BMW spokesman said, "We are not
currently involved in natural-gas vehicles," and Ford said it isn't involved in the Alliance's project, nor does it plan
to produce a conversion kit for Mustang.
These "bi-fuel" vehicles cost thousands of dollars more than gasoline-powered vehicles. Advocates say low
natural-gas prices can make up the difference over time. CNG costs between $2.20 and $2.50 a
gallon-equivalent, below the average pump price for unleaded gasoline. But conversions aren't cheap: General
Motors Co., which began selling a pair of bi-fuel CNG pickups in December, prices them at about $11,000 more
than gasoline versions.
The gas-industry group says the demonstration is designed to spur consumer and auto makers' interest in
CNG-powered cars at a time when surging gas production has dramatically lowered prices. That has spurred a
renewed drive by gas producers and auto makers to make the fuel a more attractive substitute for gasoline.
"We hope the excitement created by these vehicles encourages policy makers to take notice," said Anne Shen
Smith, CEO of Southern California Gas.
Some commercial vehicles, including corporate fleets and heavy trucks, are already using or experimenting with
natural gas. One advantage for these large-scale users over retail buyers is that they can afford to build and
maintain their own refueling stations. While more than 100,000 CNG vehicles are being driven in the U.S., just
under 600 stations are open to the public.
Gas producers hope that by showcasing the CNG-retrofitted vehicles they can spark fresh interest. Auto-industry
analysts remain skeptical manufacturers will rush into the market, no matter how low natural-gas prices fall.
"You can't dedicate a vehicle to this fuel until you've got natural-gas pumps almost as ubiquitous as gasoline
pumps," said Phil Gott, senior director at IHS Automotive.
To help resolve that dearth in natural-gas fueling stations, two leading gas producers have joined forces with
home-appliance manufacturers in separate bids to develop affordable refueling equipment that plugs into

household gas lines. In December, Encana Corp., North America's third largest natural-gas producer, linked up
with Whirlpool Corp. and four U.S. utilities. Similarly, Chesapeake Energy Corp. is working with General Electric
Co.
Gas company officials say major auto makers are paying close attention to these efforts and are readying
conceptual models that may serve as trial balloons for future mass-market vehicles. "You will see over the next
year or two, probably less than a year, some concepts of natural-gas [passenger] cars," Eric Marsh, executive
president at Encana, said in an interview.
Document J000000020130518e95i0003v

Ford's EcoBoost family takes a hit ; Stalling and power loss complaints could taint important engines
MONEY
Ford's EcoBoost family takes a hit ; Stalling and power loss complaints could taint important engines
James R Healey
James R. Healey, USA TODAY,
546 words
17 May 2013
USAT
FINAL
B.3
English
A lawsuit over Ford's heavily advertised EcoBoost engines is the latest tarnish on the carefully crafted image of
the engines as premium units worth a premium price.
Ford has sold some 700,000 engines with the EcoBoost label, about 400,000 of those being the 3.5-liter V-6 in
F-150 pickups, where it can add $2,395 to the price.
Now, some owners of that 3.5-liter V-6 EcoBoost engine, also used in Lincolns and Ford cars and SUVs, have
sued Ford because the engine doesn't run right, they say.
Ford won't discuss the lawsuit. The symptoms it cites -- stalling and power loss -- match complaints Ford
addressed last year in a bulletin to dealers, and by making a running change on the assembly line. That bulletin
tells mechanics how to fix "intermittent stumble and/or misfire" in V-6 EcoBoost engines.
Even if it's as simple as getting dealers to update the vehicles owned by the people suing, headlines about the
suit cloud the EcoBoost name that, the automaker says, has boosted its appeal among potential buyers.
"We're committed to the EcoBoost brand, which is important to Ford," says spokesman Mark Schirmer.
EcoBoost is Ford's marketing term for engines that use turbocharging and direct injection and are
smaller-displacement than would be typical for the size and style of vehicle.
Other EcoBoost problems:
In February, Consumer Reports said that many of today's turbocharged engines fail to keep their advertised
promises of better fuel economy and strong performance. Ford's Fusion with 1.6- liter EcoBoost became the chief
bad example, being "among the worst" in real-world mileage among new midsize sedans.
Last year, Fusion and Escape SUVs with 1.6-liter four-cylinder EcoBoost engines were recalled several times for
coolant and fuel leaks.
But Ford might have a Teflon coating. Not only are Escapes and Fusions selling well despite the recalls, Ford is
adding a 1.5- liter four-cylinder that it makes elsewhere to the lineup because it can't make enough 1.6-liter
EcoBoost engines to keep up.
"Everybody has issues these days. It's Ford's turn," says Phil Gott, a senior director at consultant IHS Automotive.
"It's not going to help, but it's not a terminal issue." The key is to take good care of aggrieved owners.
Ford believes it did that in the previous recalls and in the case of 3.5-liter EcoBoost stumbles, though the three
Ohio Ford owners who are suing surely would disagree.
Fusions, nearly all of which have EcoBoost 1.6- or 2-liter, four- cylinder engines, are zooming in import-favoring
California, says Ford sales analyst Erich Merkle: up 117% January through April and 146% in April. One reason:
"The EcoBoost mileage."

EcoBoost Fusions are rated 26 to 29 mpg in combined city/ highway driving in government tests, and as much as
37 mpg on the highway.
photo The 2011 Ford F-150 EcoBoost "hero engine" demonstrates its wealth of low-end torque in Oregon by
dragging logs weighing 2 to 5 tons.
Document USAT000020130517e95h0001e

Pickups: America Falls Back in Love
Pickups: America Falls Back in Love

By Jeff Bennett and Joseph B. White
1,014 words
16 May 2013
J
B1
English
SAN ANTONIO -- Texas is pickup truck country and the front line in an expanding battle among auto makers to
load up on profits from pickups, one of the richest businesses up for grabs as the global auto business roars back
to life.
After years of waiting on the sidelines, pickup buyers are returning to dealer showrooms, offering millions of
dollars in profit and potentially lifelong brand loyalty to Ford Motor Co., General Motors Co. or Chrysler Group
LLC and rivals.
Sales of large pickups are up 20% for the first four months of this year compared with a year ago -- bigger gains
than in small cars or midsize cars, according to Autodata Corp. In Texas, pickups accounted for a whopping 23%
of the state's 22.6 million registered vehicles last year.
The battle for shoppers is expected to intensify into 2014. Last year, 1.6 million pickup trucks were sold in the
U.S.; this year, analysts and industry executives expect sales nationally to hit 1.8 million and possibly 2 million in
2014.
Mike Mack, president of Golden, Colo.-based Centerline Solutions LLC, says until recently his cell-tower company
was delaying replacing vehicles in its truck fleet, or buying used trucks. Now, it is growing again and he is looking
to buy new light and heavy-duty pickups. "We'll be purchasing 25 to 30 more trucks in the next couple of years,"
he says.
"You have the recovering economy, a recovering housing market and a consumer who is now ready to buy. It has
been about 13 years, on average, since these customers have been in the market. All that is coming together
right now," said Citi Research analyst Itay Michaeli.
The auto makers are gearing up for higher demand. Ford, which currently leads by number of trucks sold, earlier
this month disclosed plans to add a third shift at one of its F-series assembly plants. Since March, Chrysler has
had three crews of workers building its redesigned 2013 Ram pickups at a plant in Warren, Mich. Both are trying
to gain share ahead of General Motors's summer rollout of redesigned 2014 Chevrolet Silverado and GMC Sierra
trucks. GM held the overall sales crown in large pickups as recently as 2009, and executives say they want it
back.
"This is big for us and we know it," said GM North America President Mark Reuss. "We are going after our
competitors, we are going after market share and we are going after customers who want trucks that get the job
done. We're putting it all out on the table."
Last week, GM rented a ranch just outside San Antonio to show off the latest generation of its full-size Silverado.
Participants were allowed to take the truck "off road" on the working cattle ranch. The vehicle's new features --
including a passenger cabin that is so quiet ranchers won't hear the clang of a horse trailer pulled behind it.
The redesigned Silverado comes with one new six-cylinder engine and two eight-cylinder engines rated at 23
highway miles on a gallon of gasoline -- more efficient than Ford's best-selling six- or eight-cylinder motors. The
truck's interior is designed to feel like a plush sedan -- except with more power outlets. Starting price for one of
the most popular versions: $32,710 -- the same as 2013.

That pricing strategy points to the intensity of competition. Average selling price for a full-size pickup averages
$35,178, according to J.D. Power & Associates. Analysts believe manufactures make $7,000 or more in operating
profit on each truck sold -- margins that would be celebrated by most luxury car makers.
Pickup sales are vital to the profits of the Detroit Three. They so dominate this market that the recent weakening
of the yen likely won't make it easier for Toyota Motor Corp., Nissan Motor Co. or Honda Motor Co. to steal away
Detroit brand pickup loyalists. But it could mean intensified competition for the Detroit auto makers in the compact
and midsize sedan and SUV segments, where margins are narrower.
Toyota this month has no interest loans for the purchase of its full-size Tundra, Nissan on its midsize Frontier,
and GM on its 2013 Silverado 1500 and Sierra 2500. Ford and GM are offering cash back for purchases of their
full-size trucks.
Large pickups, which weigh between 6,500 and 7,000 pounds, are outliers in a global auto market dominated by
compact and midsize cars and sport-utility vehicles. Sales are minimal outside of North America -- an anomaly in
a business where car makers strive to design vehicles that can be sold in most countries. These trucks are the
last major vehicles where the Detroit Three maintain an oligopoly.
"We aren't building trucks for someone driving down Madison Avenue -- kind of the urban cowboy," said GM Chief
Executive Dan Akerson said on Monday in Warren, Mich. "Where I grew up in Minnesota, people make a living
with their trucks."
In place of a serious competitive challenge from Japan, the Detroit brands are feeling the heat from customers
demanding better fuel economy and from federal and state regulators who want large pickups to catch up with
sedans and SUVs on safety and reduced gas emissions.
In 2010, with pickup sales still depressed by the housing slump, Ford put a six-cylinder turbocharged engine in
the F-150, and began promoting the "EcoBoost" motor as the class leader in both fuel economy and pulling
power, or torque.
Ford truck marketing manager Doug Scott says he is confident Ford will sustain its recent sales volumes of about
60,000 trucks a month, and keep the F-series the No. 1 selling large pickup. Ford's rivals "are largely playing
catch-up," he says. "We don't feel we are susceptible to any amount of conquest."
Document J000000020130516e95g00029

Trying to Be Hip and Edgy, Ads Become Offensive
Business/Financial Desk; SECTB

Trying to Be Hip and Edgy, Ads Become Offensive
By STUART ELLIOTT and TANZINA VEGA
1,242 words
11 May 2013
The New York Times
NYTF
1
English
Madison Avenue is learning a painful lesson: cutting edge advertising can slice both ways.
Some of the biggest names in marketing, including Ford Motor, General Motors, Hyundai Motor, Reebok and
PepsiCo, have been forced recently to apologize to consumers who mounted loud public outcries against ads that
hinged on subjects like race, rape and suicide.
PepsiCo found itself meeting this week with the Rev. Al Sharpton and the family of Emmet Till -- the teenager
whose death in Mississippi in 1955 helped energize the civil rights movement -- to try to quell multiple
controversies involving its Mountain Dew brand.
''It's like the Wild West,'' said Paul Malmstrom, a founding partner of the New York office of the Mother ad agency.
Advertising experts offer a long list of reasons for the increasing frequency of such incidents, but the primary
reason they keep happening, they say, is the growing anxiety on Madison Avenue to create ads that will be
noticed and break through the clutter.
''It's the pressure to create 'viral' advertising, the urge to get more views online, that leads people to push the
envelope,'' said Tor Myhren, president and chief creative officer at Grey New York. He added that another
contributing factor was the focus on younger consumers. ''There's so much 'How do we speak to millennials?' in
meetings,'' he said.
The toll that those controversies are taking on the ad business is in some instances more than just
embarrassment. Two senior creative executives at JWT India, including a managing partner, lost their jobs after
the company produced fake ads for the Ford Figo hatchback that showed women bound and gagged in the trunk
as celebrities like Paris Hilton and Silvio Berlusconi sat behind the wheel.
JWT apologized, as did Ford, although there was nothing to suggest that the carmaker had either approved or
known about the fake ads.
The celebrities in the Ford India ads appeared without consent, but even instances where stars agree to work
with a brand can be fraught with risk.
Those celebrities, particularly rappers and actors with images as rebellious rule-breakers and risk-takers, often
appeal to marketers' youthful target audiences and have huge followings on social media. That is what drew
Mountain Dew to Lil Wayne, the rapper who signed a multimillion-dollar celebrity endorsement deal with the
soft-drink brand last year. The brand severed ties with the artist last week, however, after the Till family took issue
with an ad that referred to Till with vulgar lyrics sung by Lil Wayne on a remix of ''Karate Chop,'' by the rapper
Future.
As part of its efforts, the family also brought attention to an offensive Mountain Dew video ad created by the
hip-hop producer and rap artist known as Tyler, the Creator. The spot featured a battered white waitress trying to
identify her assailant from a lineup that included African-American men and a goat. Mountain Dew dropped the ad
on May 1.

On Wednesday at the PepsiCo offices in White Plains, company executives, including Frank Cooper, the chief
marketing officer for global consumer engagement for Pepsi, and Till family members gathered for a private
meeting with Mr. Sharpton.
In a telephone interview, Mr. Sharpton described the meeting as good and its tone as respectful. He said, ''The
family explained the pain that they have gone through since the killing'' and Pepsi executives ''repeated their
apology and said they would have nothing to do with Wayne and his tour.''
In a statement, the Till family said: ''We look forward to ongoing and meaningful collaborations which bridge the
music community, corporations, grass-roots organizations and youth.'' A representative from PepsiCo agreed that
the meeting had been amicable but declined to provide details.
David Schwab, senior vice president at Octagon First Call, a division of Octagon, the sports and entertainment
marketing agency, said that brands used stars ''to build awareness and create differentiation.''
''But a celebrity who can be a difference maker can come with a high risk,'' Mr. Schwab warned, meaning ''there is
more pressure on brands to be careful.''
In April, Reebok dropped the rapper Rick Ross after the brand came under pressure for a lyric he performed in
the Rocko song ''U.O.E.N.O.'' that referred to drugging a woman and having sex with her without her knowledge.
Hyundai UK dropped an ad last month that featured a man trying to commit suicide by running his car in a
garage. The ad, meant for the European market, depicted how the effort failed because the car was a
zero-emission Hyundai. The revelation was meant as a punch line, but consumers were horrified at what they
deemed an attempt to make light of suicide.
General Motors scuttled an ad that promoted its Chevrolet Trax, a small sport utility vehicle that is sold in
countries including Canada. The ad, set in the 1930s, featured a modern remix of a song from that era that
included references to Chinese people using phrases like ''ching ching, chop suey.''
Bob Garfield, the longtime advertising critic who is an author of the book ''Can't Buy Me Like,'' said the situation
was aggravated by the Internet culture on which millennials dote, which he described as ''no holds barred,'' where
''a sense of permissiveness reigns.'' It ought to come as no surprise, he added, that ''incredible lapses of
judgment'' are taking place regularly at major brands and their marketing agencies.
Nancy Hill, president and chief executive at the trade organization for the ad industry, the American Association of
Advertising Agencies, said the ''race to retweet and to click 'thumbs up,' '' overwhelms the impulse ''to take a step
back and make sure the ad is crafted exactly the way you want it to be received.''
Mr. Schwab said marketers like PepsiCo must pause for ''due diligence'' when dealing with celebrities like Lil
Wayne, ''learning what is the history of these people, what their lyrics say, what is their fan interaction -- even a
simple Google search.''
Mr. Myhren of Grey New York said his agency ran all ads through a legal clearance process and he hoped clients
would run those ads through their own clearance processes as well.
Still, ''you will see more'' ad controversies, he predicted, until ''there will be a really bad one, something that will
happen to a major, major marketer that will make everyone rethink the checks and balances.''
Mr. Sharpton said he intended to lead a broader conversation with the executives of PepsiCo, other major
corporations and the music industry, civil rights groups and the families of Mr. Till and Trayvon Martin. He said he
would contact executives at Coca-Cola, Walmart, the record label Cash Money and the rap mogul Russell
Simmons, among others, and expected to hold a meeting within the next 30 days.
''I don't want to shut down black artists, but how do we protect ourselves against depravation and misogyny?'' Mr.
Sharpton said. ''The artists do not understand that you may have a younger following, but you're dealing with
corporate responsibility from older stockholders who are just not going to tolerate that.''
Mountain Dew dropped a video ad created by the rap artist Tyler, the Creator, in which a battered white waitress
tried to pick her assailant from a lineup that included black men and a goat. (B7)
Document NYTF000020130511e95b0008j

U.S. Car Makers Are Missing in India
U.S. Car Makers Are Missing in India

By Anirban Chowdhury
832 words
11 May 2013
J
B1
English
MUMBAI -- Sleek new compact cars sporting the Maruti Suzuki and Hyundai brands stand out on the streets of
India's business capital against the mishmash of aging buses and black taxicabs.
The view is similar across India, a country where consumers have an affinity for smaller and fuel-efficient cars
and, increasingly, for Asian auto brands. Much harder to spot are the logos of top Western mass-market car
makers such as Volkswagen AG, General Motors Co. and Ford Motor Co.
While major players in China, Asia's other big and growing car market, the three are struggling to expand sales
here. Each reported Indian sales fell between 16% and 20% year-over-year in the 12 months ended March,
according to the Society of Indian Automobile Manufacturers. Their combined share of the car market stands at
just 9%.
Some industry executives say these companies lack the compact models that consumers prefer in India, and
have too few sales and repair outlets in the country.
Others say razor-thin profit margins on small cars make India a highly competitive and unprofitable market, and
may explain the Western companies' small shares. India's compact hatchbacks usually sell for between $5,000
and $10,000 each.
"It isn't that the international companies are incompetent, it is just that there is not much of a prize [in India] yet. It
is a much, much smaller profit pool," compared with markets like China, said Max Warburton, an autos analyst at
investment research firm Sanford C. Bernstein & Co.
Maruti, the Indian unit of Japan's Suzuki Motor Co., and Hyundai Motor Co. together hold 54% of the nation's
new-car sales, thanks to a broad sales and service networks and a loyal following for their cars and hatchbacks,
which last year took seven spots out of the 10 best-selling models in India.
Meanwhile, Volkswagen hasn't launched a new compact model in India since 2010, save for refreshed versions of
existing cars, while Ford launched just one, the new Fiesta, in 2011. GM launched its Sail U-VA last November.
"Hyundai's management treated India as a different market, rather than bracketing it with other emerging markets
such as Indonesia and Brazil as a lot of others tended to do," said B.V.R. Subbu, Hyundai's first India president,
who left the firm in 2006. He said the move helped catapult the firm, globally a "basement brand," to the No. 2
position in India.
Though most Western car makers have been in India for decades, they don't have the networks that Asian brands
do. Maruti now runs about 3,000 service centers across India. Hyundai, which launched in India in 1996, has 904
such service facilities, dwarfing Volkswagen's 111 and 260 for Ford.
For the Indian consumer, having a large maintenance network, especially in a country with poor road
infrastructure, is "always reassuring," says Niraj Shah, who runs an insurance consultancy in Mumbai.
However, a dominant market position in India doesn't always translate into large profits, as is the case for
Hyundai. While the company recorded a net profit of about $8.2 billion in 2012, its India net profit for the year
ended March 2013 amounted to just $155 million. Toyota posted a loss of about $5 million in India its fiscal year
ended March 2012.

Despite their smaller position in India, Western auto giants are investing. Ford has plans to introduce six more
models in India by 2015 and GM has started introducing cars from its Chinese partner SAIC Motor Corp. Both
have plans to build engines in the country.
Bob Socia, GM's chief of operations in China, India, and Southeast Asia, said India remains one of the company's
most important growth markets. GM anticipates that India's market will grow by 3.76 million vehicles over the next
10 years to become the world's third largest.
Meanwhile, Ford says it has "confidence in [the] long term fundamental growth story" in India, and aims to boost
its service centers to 500 by 2015.
Arvind Saxena, managing director of Volkswagen India, said the company hopes to increase its India market
share to 6% by 2018, from around 2.4% at present. He said its aim this year will be to maintain its share because
of tough market conditions.
There are already signs that the bigger sport-utility vehicles the Western auto makers are known for are gaining
traction among Indian consumers. Utility vehicles as a proportion of total sales grew to 21% in the year ended
March from 14% a year earlier. Ford now plans to launch the EcoSport compact SUV in India in the coming
months, while GM has unveiled a multipurpose vehicle, the Chevrolet Enjoy.
---
Kyong-Ae Choi and Mike Ramsey contributed to this article.
Document J000000020130511e95b0001p

Corporate News: Chrysler's Jeep Faces Uphill Climb in China --- Auto Maker Plays Catch-Up as It Finds a Partner to Help Restart Production...
Corporate News: Chrysler's Jeep Faces Uphill Climb in China --- Auto Maker Plays Catch-Up as It Finds a
Partner to Help Restart Production in Big Market; Doubling Dealers Is a Goal
By Mike Ramsey and Christina Rogers
753 words
10 May 2013
J
B4
English
Jeep, one of the first Western auto brands to sell in China, is struggling to reestablish production in the world's
largest automotive market.
Production of Jeeps in China started way back in 1983, but came to a halt in 2006 just before Jeep's owner,
Chrysler Group LLC, was split from Daimler AG. The German auto maker retained the partnership and plant in
Beijing that had assembled Jeeps.
As a result, Jeep has fallen behind as the Chinese market has expanded in the last five years. In 2012, just
46,000 Jeep vehicles were sold in China -- a sliver of a market of around 19 million cars and light trucks. All of
those Jeeps were imported from the U.S., their prices inflated by import duties.
Last year, Jeep's effort to build vehicles in China was thrust into the spotlight when Republican presidential
candidate Mitt Romney aired ads suggesting it would come at the expense of U.S. jobs. Chrysler said it had no
plans to shift U.S. production and would build in China for the Chinese market.
Chrysler, with the help of current parent, Italy's Fiat SpA, has lined up a new production partner, state-run
Guangzhou Automobile Group Co., but has yet to firm up a final agreement that would allow production to restart.
Officials from the companies said last month at the Shanghai auto show that a deal is nearly complete and
sign-offs with the Chinese central government should come in a few months, and production could begin at their
existing factory in late 2014.
"I am very confident we will be successful," said Mike Manley, chief executive for Jeep and Chrysler's head of
international operations in an interview in Shanghai last month. "We really need to produce locally to compete."
Meanwhile, the Chinese market for SUVs is exploding. Chinese consumers bought 2 million SUVs in 2012, up
almost 25% over 2011, according to the China Association of Automobile Manufacturers, three times the overall
industry sales growth. And SUVs are forecast to be the fastest-growing segment for years to come.
Right now, Jeep sells three models in China -- the Wrangler, Grand Cherokee and Compass. Since they are
shipped from the U.S. and subject to a 25% import tariff, it is difficult for Chrysler to sell them in large volumes. A
top-of-the-line Jeep Grand Cherokee sells for as much as $205,000, triple its price in the U.S.
Finding a way to make Jeeps in China and avoiding tariffs isn't the only challenge. Jeep has too few dealers, only
about 160 showrooms. Mr. Manley said he needs to at least double the number in the next two years.
In contrast, General Motors Co. and Ford Motor Co. have been up and running in China for years, and are both
spending billions of dollars to expand production operations there.
Chrysler's struggles in China are similar to what it faces in Russia, another giant, emerging market where
Chrysler still hasn't completed a deal to build a plant, more than a year after the company announced plans to do
so.
For Chrysler and Fiat, expanding in China and Russia is critical because both markets promise to grow faster
than other regions of the world. Sergio Marchionne, chief executive for Fiat and Chrysler, is counting on Jeep and
its global potential to expand sales in those markets as new wealth produces a surge in demand for cars.

Jeep appears to have strong potential in China. The brand is well recognized by consumers and its following
includes dozens of Jeep fan clubs.
Xiong Jiuhai, a middle-aged businessman, was admiring the Jeep Cherokee on display in the jam-packed expo
center last month. "Jeep cars offer a sense of masculinity. They look grandiose," he said. The Cherokee, which
will be known as "Zi You Guang" in Chinese, will go on sale by the end of the year in China, and he said he wants
to buy one.
Jeep branded clothing through 200 retail stores with styling something akin to Eddie Bauer or Columbia. "Our
brand awareness is significantly ahead of our brand sales," Mr. Manley said.
Document J000000020130510e95a0000y

Lincoln logs in a nice restart with MKZ ; Sleek, solid-looking with good power, but not without issues
MONEY
Lincoln logs in a nice restart with MKZ ; Sleek, solid-looking with good power, but not without issues
James R Healey
James R. Healey, jhealey@usatoday.com, USA TODAY
1,444 words
10 May 2013
USAT
FINAL
B.3
English
Lincoln Motor Co.?
Ford Motor wants you to think that its Lincoln upmarket brand is so different, so not-just-Fords-with-big-grilles,
that it has renamed Lincoln as if it were a separate automaker.
Lincolns and Fords are made at Ford Motor factories, often sharing significant components, so it's a stretch to
consider Lincoln independent.
But the Lincoln MKZ seems not much like the Ford Fusion on which it's based. That's a good start, because MKZ
is meant to revive Lincoln and give it a new identity: as sexy as Jaguar, as refined as Lexus, sporty enough to
convert German loyalists.
"Luxury customers are very loyal to their brand, but not so loyal they won't try something new," says Jim Farley,
Ford Motor's marketing chief who's on the hook for reviving Lincoln.
To help tempt prospects, Lincoln offers a concierge who'll be like your personal car shopper, arranging a test
drive, and finding and setting up delivery of the car you want. Buyers on the fence can borrow an MKZ for a
couple of days, plus get a free dinner at a high- falutin' restaurant.
There's a lot of personal taste at work choosing a high-dollar sedan, and your tastes might differ. But the MKZ --
$36,000 to $51,000 -- seems alluringly drawn, well put together, nicely executed and different from what the
snotty neighbors drive.
Test Drive had a short time in a gas-electric hybrid model and a loaded V-6 with all-wheel drive, and more time in
a four-cylinder with AWD.
The four-cylinder had troubling issues: a violent transmission clunk, but just once; a rattle underneath that came,
then went away as quickly; a rear safety belt that wouldn't latch. Lincoln says all those are unrepresentative, and
Test Drive is willing to agree. There was too little time to deliver a replacement four-cylinder to take a second
look.
Considering the three cars in total, here are the best features:
Style. Sleek, solid-looking. The taillights have a bit of Dodge Dart to them, though, which isn't the uplevel touch
you look for in a luxury car.
Seats. Enough curve in the backrest to cosset your back without letting it sag. Quite comfortable. Back seats
have lots more knee space than appears at a casual glance. Adult-size.
Power. Good. The four-cylinder turbo has nearly as much torque as the much larger V-6, and the torque is
delivered at lower engine speeds. Thus, the four is a good scooter in traffic. But the V-6's 300 horsepower makes
it the real hustler up the entrance ramps. And it's just plain fun to flog. Which, of course, wrecks the fuel economy
-- in our case, dragging it down to midteens.

The hybrid is a very good hybrid, largely because Ford Motor does great work minimizing to near-invisibility the
shudders typical of a hybrid when the gas engine starts and teams with the electric. Test Drive tried to see if the
hybrid is any fun on frisky days (not much). It delivered 30 mpg. Far from its 45 mpg rating, but pretty good for the
flogging it got.
Options. Heated/cooled seats were a winner among passengers.
Power up/down trunk lid is surprisingly handy. Who says power lids should be on SUV tailgates only?
Suspension. Automatically adjusts fast enough, Lincoln says, that it can sense a wheel dropping into a pothole
and firm up the shock absorbers fast enough to take it in stride. It did seem gentler over a bad repaving atop a
recent water main job. You can adjust it to be firmer if you have more tight corners than bad paving on your
commute.
Not so good:
Drivetrains. Setting aside the four-cylinder's transmission clunk, the V-6 was hard to keep rolling smoothly at low
speed; a too- much/too-little dance.
The hybrid, though exceptional at eliminating the shakes, still intrudes, as hybrids do. It has a continuously
variable-ratio automatic transmission, and those always rev the engine and hold it there, generating an
unpleasant sound and feel. But CVTs save fuel and are typical for hybrids.
Controls. They are a version of the Ford Sync/MyLincolnTouch setup. Most operations are managed via
touch-screen or voice.
The screen isn't intuitive. Finding, say, the audio controls while the screen displays a navigation map diverts too
much attention from the road. You can display a glimpse of all four modes -- navi, phone, entertainment, climate.
But if you want to do serious business with any one, you must choose it for screen-wide display. Too fussy.
For functions that don't lend themselves to voice control, or steering wheel buttons, old-fashioned knobs are light
years ahead and less distracting. Touch-screens are tech-sexy, but in cars they could, literally, be the death of us
all.
Pushbutton gearshift. A vertical line of big, square buttons on the dashboard, to the right of the wheel, lets you
choose among park, reverse, neutral, drive and sport (or low in the hybrid, which recharges the battery faster
when you slow). They tidy the appearance and open console space. And, Lincoln correctly argues, they are
quickly mastered.
But they're no fun. MKZ is supposed to be sporty. It needs a transmission lever to use for manual gear changes in
manual mode, or simply to hold because it feels right. Shift paddles on the steering wheel aren't the same. They
work, but they, too, are no fun.
GM's Cadillac worked more than a decade to get back on credibility charts. Lincoln hopes it won't have to grind
away in the trenches for a decade to become an "overnight sensation."
Our grumbles and fussing aside, MKZ seems like the right kind of car to quicken the transformation.
List
Lincoln MKZ details
What? Four-door, five-passenger, midsize luxury sedan based on Ford Fusion. Available with front-wheel drive
(FWD) or all-wheel drive (AWD) on gasoline models. FWD-only for hybrid model.
When? On sale since December, but not widely available until April.
Where? Made at Hermosillo, Mexico, with engines from Valencia, Spain; Lima, Ohio; and Dearborn, Mich.
How much? Four-cylinder gas model and gas-electric hybrid start at same price, $35,925, including $895
shipping. V-6 starts at $39,045. V-6, AWD, all factory options: $51,205.
What makes it go? Choice of three drivetrains:

A 2-liter EcoBoost turbocharged four-cylinder rated 240 horsepower at 5,500 rpm, 270 pounds-feet of torque at
3,000 rpm or a 3.7-liter V-6 rated 300 hp at 6,500 rpm, 277 lbs.-ft. at 4,000. Both use six-speed automatic
transmissions with manual-shift mode.
A gasoline-electric hybrid with a 2-liter, four-cylinder gas engine and electric motor. Combined rating is 188 hp,
141 lbs. ft. Linked to a CVT (continuously variable-ratio automatic transmission).
How big? An inch or so bigger outside than Lexus ES, but a little smaller inside. MKZ is 194.1 inches long, 73.4
in. wide, 58.2 in. tall on 112.2-in. wheelbase. Weighs 3,719 to 4,002 lbs. Passenger space, 96.5 cu. ft. Trunk,
15.4 cu. ft. (hybrid, 11.1 cu. ft.). Turning circle diameter, 38 ft.
How thirsty? Gas 2-liter, FWD rated 22 mpg in the city, 33 mpg on the highway. 26 mpg in combined city/highway
use. AWD: 22/31/25. The 3.7-liter V-6, FWD rated 19/28/22. AWD: 18/26/21. Gas-electric hybrid rated 45/45/45.
Trip computers in test cars registered:
2-liter, four-cylinder, AWD, 20 mpg (5 gallons per 100 miles) in vigorous suburban driving.
3.7-liter, V-6, AWD, 14.2 mpg (7.04 gal./100 mi.) in rambunctious suburban driving.
Hybrid, 30 mpg (3.33 gal./100 mi.) in spirited suburban driving.
All burn regular. Tank holds 16.5 gallons (four-cylinder FWD), 17.5 gal. (four-cyl. AWD and all V-6s), 13.5 gal.
hybrid.
Overall: High-style, high-class, high-spirited, hurt by quirky and cumbersome controls.
List
What stands out
Styling: Exceptional.
Interior: Also exceptional.
Controls: Please, give us back knobs, switches and gearshift levers.
photo Photos by Lincoln Motor Company The four-cylinder turbo has nearly as much torque as the much larger
V-6.
Document USAT000020130510e95a00017

Joe Wang: Understanding the goal is important
CapitalBusiness
Joe Wang: Understanding the goal is important
394 words
6 May 2013
The Washington Post
WP
FINAL
A29
English
Copyright 2013, The Washington Post Co. All Rights Reserved
Position: Chief operations officer of ServicePower Technologies, a Reston company that provides mobile field
management technology.
Fresh out of college, Joe Wang and two friends opened a restaurant on the campus of Ohio State University.
Though the business plan looked great on paper, Wang and his partners had a rude awakening during the
summer when students were scarce and revenue plummeted. After closing the business, Wang discovered a
passion for operations. He went to work for a restaurant chain and did field management for Ford Motor Co.
before moving to Best Buy to help the retailer integrate acquisitions.
I'm a nerd. I would bore someone to death talking about process and the different ways you can do things. I'm
wired this way. I'll organize my refrigerator to make sure you can see everything when you open it up.
No, I was the least organized. My dad was off-the-charts anal retentive.
Because of my experience, I see how sometimes the goals you're given as an employee in a big company don't
make sense. The company will say, 'We need you to deliver this.' The problem is, if you deliver that, it's like
squeezing a balloon. You'll deliver, but problems pop up somewhere else. I like to understand, if I'm accountable
to deliver this result, why? What am I delivering? If there's another end game that's more important, then that
should be the goal. When you understand that, having a clear process is a way to eliminate the noise in the
system so you can get to the goal easier.
There was a time in my career where it was command-and-control. Just get it done. At Ford, I had a lot of those
attributes. Here's what I learned: I remembered how passionate the folks who worked at my restaurant were.
They knew we were a start-up company and they were proud of that. We treated employees like partners. A lot of
companies forget to do that. If employees understand why they're doing it, they might work harder. Let's spend
some time so that everyone understands what we're going after and why. Then the next question is: Are we going
after it the best way?
WP20130506behindthecareer0506
Document WP00000020130506e95600014

Japanese Car Makers Lose Their Midsize Edge --- After Closing Quality Gap, Ford Fusion, Hyundai Sonata, VW Passat, Others Pose Real Challenge
Japanese Car Makers Lose Their Midsize Edge --- After Closing Quality Gap, Ford Fusion, Hyundai
Sonata, VW Passat, Others Pose Real Challenge
By Christina Rogers
900 words
6 May 2013
J
B1
English
For Charlee Smith, buying an affordable family sedan used to be a no-brainer. He mainly bought vehicles from
Nissan Motor Co., believing Japanese autos cars stood out for their quality, reliability and resale value.
But when looking for a new vehicle a few months ago, the 63-year-old Templeton, Calif., sales manager
broadened his search, checking out models from Volkswagen AG, Hyundai Motor Co. and the Detroit auto
makers. He wound up buying a Fusion Hybrid, from Ford Motor Co., his first domestic-brand car in years.
Mr. Smith said he felt "an emotional connection" to the $27,200 Fusion's curvaceous creases and edgy design.
Ford's gains in reliability and fuel economy were a selling point, too. "The Fusion just won in every category," he
said.
His purchase reflects a fundamental shift in the large and influential midsize sedan market. Competition is greater
and consumer deals are rising. Nissan last week cut the list price of its redesigned Altima by 2.7%, or $580, and
General Motors Co. in February dropped its Malibu sticker by up to $770 and is offering rebates.
A weaker yen may give other Japanese makers room to lower prices as well.
A few years ago, Toyota Motor Corp.'s Camry and Honda Motor Co.'s Accord were top sellers by a wide margin.
Their share fell to 28% in the first quarter, from 37% of the U.S. midsize sedan market in 2008, according to
Edmunds.
Now, it is a wide-open market. Ford and GM have turned their midsize sedans into real challengers and closed
the quality gap with Japan; meanwhile, the Japanese were knocked off stride by recall troubles that hurt Toyota in
2010 and production disruptions in Japan that resulted from the 2011 earthquake and tsunami.
The rising challengers include Ford's Fusion, with a 11.9% share of U.S. sales through April, up from 6.8% for all
of 2008, Kia Motors Corp.'s Optima at 6%, up 3.9 percentage points, and Volkswagen AG's Passat at 3.9%, up
2.5 percentage points, according to auto website Edmunds.com.
"We've never had anything like this," said Michael J. Jackson, chief executive of AutoNation Inc., a large chain of
new-car dealerships. "If you look at the quality, innovation and distinctive design of these midsize vehicles, this is
what luxury cars used to be 10, 15 years ago."
Winning over midsize car buyers is crucial for auto makers. In 2012, 3.5 million midsize cars were sold in the U.S.
-- a quarter of the entire light-vehicle market. At an average price of $25,000, that is a $90 billion business.
Toyota and Honda's grip on the segment started to loosen in 2011, following the arrival of a boldly designed
Hyundai Sonata and cheaper VW Passat. New versions of the Nissan Altima, Ford Fusion and Chevrolet Malibu
arrived in showrooms last year.
Chrysler, on the other hand, is still struggling with aging midsize cars that won't be replaced for at least another
year.
Both the Camry and Accord were recently redesigned, too. But they are no longer head and shoulders above the
pack. "People buy them because they're reliable but they've started to fall into the appliance category," said Mr.
Smith, the Fusion buyer.

Last month, sales of the sedan jumped 28% over the year-earlier month.
The Ford Fusion is rated to go 36 highway miles on a gallon of gas, matching the Accord's rating, and the Nissan
Altima has a 38 highway miles rating, three more than the Camry.
Further intensifying the competition is the midsize-car market is no longer growing as fast as it did last year,
putting more pressure on auto makers to steal buyers from rival brands to boost sales.
"The Camry is under intense pressure," said Tom Libby, an auto analyst for research firm, R.L. Polk. "It is not just
one model anymore. For the buyer who wants a midsize family car, it is a perfect time because of the
competition."
The new competition has forced the Japanese to do something unexpected: Raise their discounts and other sales
incentives. Toyota recently began offering zero-percent financing on its 2013 Camry, hoping to spur sales after a
sluggish start to the year.
While still the market's top-seller, Camry sales were down 7% through April this year. The average net price on a
Camry last month was about $21,336, down about $2,700 from March 2012, according to Edmunds.com.
The Accord, while still the second-best selling car in the U.S., is falling short of Honda's internal goals, said John
Mendel, the company's vice president for sales. In April, Honda's sales fell 5% from the same month a year ago.
Honda now has among the lowest incentives in the market for its midsize sedan.
GM, Ford, and others are also nudging up incentives. GM is now offering up to $2,000 in cash rebates on the
Malibu on top of its price drop. Ford is offering $1,500 in rebates on the Fusion.
Document J000000020130506e9560000d

Corporate News: Pickups Steer U.S. Auto Sales --- Detroit Car Makers Collect Double-Digit Gains as Industry Volume Climbs 8.5%
Corporate News: Pickups Steer U.S. Auto Sales --- Detroit Car Makers Collect Double-Digit Gains as
Industry Volume Climbs 8.5%
By Mike Ramsey
726 words
2 May 2013
J
B2
English
U.S. pickup truck sales boomed in April, contributing to double-digit sales gains at Detroit auto makers as
improving home construction spurred new-vehicle purchases by contractors and tradesmen.
Chrysler Group LLC said Wednesday that sales of its Ram pickups rose 49% in April from a year earlier, while
Ford Motor Co. said its F-series truck sales jumped 24%. At General Motors Co., combined sales of its Silverado
and GMC Sierra climbed 23%.
Overall, industry sales for April rose 8.5% from a year earlier to 1.285 million cars and light trucks, according to
researcher Autodata Corp.
For the Detroit auto makers, a resurgence in demand for trucks especially among contractors in the home
building industry has been long-awaited. Full-size pickups are big moneymakers for the companies, producing
margins that can be as much as 10 times that of a sedan, some analysts estimate.
Rich Savino, the owner of All American Ford in Old Bridge Township, N.J., said his dealership's F-series sales are
up a "spectacular" 74% this year through April, with tradesmen replacing old trucks as new home developments
pop up.
"I am getting the contractors coming in and expanding their fleets," said Mr. Savino. "This is the start of it. When
the trades and contractors are coming in and complaining they can't hire enough people -- that kind of stuff to me
is a better indicator of the direction we are going" than other economic indicators.
Sales of pickups have historically been tied to housing construction. Real estate has been rebounding this year,
with prices up and new housing starts surging by more than a third over the first quarter of 2012. Pickup truck
sales have risen by 20% this year through April -- three times faster than the other vehicle segments, Ford said in
a conference call.
Vinny Sessa, owner of New Jersey Best Lawns, Sprinkler and Fencing, bought nine F-series trucks to replace his
aging fleet. "We were busy; we had to add to the fleet. But we were replacing some old trucks too," Mr. Sessa
said.
The surge in demand has prompted Ford to step up truck production. It said early Thursday it would add a third
shift to its Kansas City, Mo., plant due to demand for F-150 pickups. Chrysler, which is majority owned by Fiat
SpA, said in March it would add a third shift to its Warren, Mich., truck plant.
"We are building everything we can right now," said Erich Merkle, Ford's sales analyst.
Chrysler's big increase came in part because of greater availability of its heavier duty commercial Ram pickups,
which were recently redesigned and have just begun rolling into dealerships, a spokesman said.
In 2011, GM added a third shift to a Flint, Mich., factory expecting a housing upturn. The recovery appears to be
kicking in now, but for a period GM had too much inventory.
GM's overall sales rose 11% in April, while Ford's sales of cars and light trucks rose 18% and Chrysler logged an
11% gain. Toyota Motor Corp.'s U.S. sales fell 1.1%, while Nissan Motor Co., Honda Motor Co. and Hyundai
Motor Co. reported U.S. gains of 23%, 7.4% and 1.7%, respectively.

Rising truck sales helped the Detroit Three reach 46.9% of the U.S. market last month, up from 44.8% a year
earlier.
Among German brands, Mercedes-Benz sold 23,635 vehicles in April, up 5.8% BMW sales rose 10% to 23,225
and Volkswagen AG's Audi brand rose 14% while its namesake brand sales declined 10%.
"Car-buying conditions are strong and will continue to release pent-up demand," said Kurt McNeil, GM's vice
president of U.S. sales operations. He added: "the economy continues to move forward and important car and
truck launches are just getting under way."
GM hit a 52-week high on Wednesday before retracing and dropping 66 cents to $30.18. Ford lost 23 cents to
$13.38, both in 4 p.m trading.
---
Christina Rogers contributed to this article.
Document J000000020130502e9520003e

Ahead of the Tape
Ahead of the Tape

Ahead of the Tape
By Spencer Jakab
432 words
2 May 2013
J
C1
English
GM Moves On Past 'Government Motors'
By now it shouldn't come as a shock to anyone that the taxpayer-subsidized Chevy Volt has become an
expensive corporate vanity project for General Motors Co. Likewise, the notion that the U.S. Treasury may be
made whole on its bailout of the auto maker has been long forgotten.
With that in mind, investors have been slow to drop the pejorative label "Government Motors." Two-and-a-half
years after its initial public offering, GM's share price has trailed the S&P 500 by 43 percentage points.
Those dalliances with Uncle Sam are immaterial to shareholders, though -- they are focused on first-quarter
results due Thursday. Expectations have dropped steadily for the quarter and full year. Analysts polled by FactSet
now see earnings per share of just 58 cents, down from the 60 cents posted a year ago -- perhaps too pessimistic
given Ford Motor Co.'s recent solid results.
GM's earnings will come a day after it revealed banner U.S. sales for the month of April, up 10% from the
year-earlier month. For the first quarter alone, its sales were 9.3% higher year-on-year. Even with such a brisk
recovery, though, North America isn't GM's biggest market by volume nowadays; it is China, and the numbers
there are even better. GM sold 816,373 vehicles from January through March, up 9.6%, compared with 664,963
domestically.
The auto maker's success in China and its hefty investments in manufacturing capacity there led one wag to
unkindly dub it "General Tso's Motors." But GM is doing for its shareholders what any multinational should, and
doing it quite well.
The weak spot in GM's global ambitions was Europe, where first-quarter sales looked like North America and Asia
but with a minus sign in front. The region's car market has contracted for 18 consecutive months and is back to
1993 volume levels, according to the European Automobile Manufacturers' Association.
Other global auto makers face similar travails, but none are trading as cheaply as GM. Its market value adjusted
for net automotive-unit cash is just 1.5 times earnings before interest, tax, depreciation and amortization. Ford, by
contrast, is at 4.2 times on the same measure.
It is time to put the name-calling aside and appreciate this relative bargain. Hello, Good-looking Motors.

Document J000000020130502e9520000t

Companies Feel Pinch On Sales In Europe
Companies Feel Pinch On Sales In Europe

By Kate Linebaugh, Sam Schechner and James R. Hagerty
1,223 words
29 April 2013
J
A1
English
Hiding behind the profit gains of America's biggest companies is a worrying slowdown in sales growth.
U.S. companies ranging from International Business Machines Corp. to United Technologies Corp. to 3M Co. to
Xerox Corp. have missed revenue forecasts, hurt by a combination of Europe's malaise, a stronger dollar and
sluggish consumer spending.
With earnings reports in from more than half the companies in the Standard & Poor's 500-stock index, first-quarter
revenue for the group is expected to shrink 0.3% from a year earlier, according to Thomson Reuters. That would
cut short the sales improvement reported at the end of last year and mark the third quarter out of the past four in
which revenues have failed to grow by 1% or more.
The sales figures are a troubling sign that business and consumer demand remain weak nearly four years after
the recession. They are also evidence that a soft patch is developing in the U.S. economy, as optimism earlier in
the year gives way to more sobering data on growth in gross domestic product, retail sales and manufacturing. In
response, many companies are cutting jobs and curbing investments in an effort to prop up profits, moves that
could make it harder for demand to recover.
One big problem for U.S. companies is Europe. Executives weren't expecting much from the region last quarter.
But many found conditions tougher than anticipated. And some of them are increasingly worried that while
Southern Europe's hardest-hit countries may be bottoming out, there is room left for the bigger economies like
France and Germany to deteriorate.
"Demand is not recovering so far" in Europe, Whirlpool Corp. Chief Executive Jeff Fettig said in an interview.
The home-appliance maker, which has production sites in Italy, France, Poland, Slovakia and Sweden, expects
flat industrywide sales in Europe this year, compared with growth of 2% to 3% in North America. If demand falls
further in Europe, "we'll have to do something more" to cut costs there, Mr. Fettig said.
The European Union accounts for about a fifth of the global economy, and Deutsche Bank estimates about 17%
of the profit and revenue for companies in the S&P 500 comes from Europe. The heavily indebted countries in the
continent's south have long struggled. Now, businesses and consumers in Europe's healthier economies are
coming under more pressure.
Companies in France are shedding workers, expanding the ranks of the fully unemployed to more than 3.2 million
people, a record in absolute terms. In Germany, new-car registrations at the beginning of the year slid 13% from a
year earlier.
"Europe sunk deeper into recession, with Southern Europe remaining particularly weak, while the northern
continent and Central Europe worsened," said Air Products & Chemicals Inc. Chief Financial Officer Scott Crocco.
The industrial-gases supplier reported its first-quarter sales rose 6% to $2.48 billion, but analysts had expected
more. Sales in Europe were down 5%. The company reduced its outlook for the year and said it would look for
ways to cut costs.
General Electric Co. watched conditions in Europe fall through its forecasts early this year. Orders had risen at
the end of last year. But by the middle of the first quarter, they were down 8% from what GE had expected,
finance chief Keith Sherin said.

By the end of the quarter, GE's revenue from Europe was down 17% from a year earlier. European orders were
off 17%, with gas turbines and jet engines about a third, and those for health-care equipment about 5% below.
"It is broader and worse than we thought," Mr. Sherin said in an interview. "People are spending less."
GE's total revenue was flat at $35 billion in the first quarter, as sales from its industrial businesses fell 6%.
Consumer-products makers haven't been spared, either. U.S.-based Procter & Gamble Co. and U.K.-based
Unilever PLC both reported weaker-than-expected sales growth for the recent quarter, as business slowed in the
U.S. and Europe.
Companies operating in Europe also are reporting signs of spreading gloom. Advertising giant Omnicom Group
Inc.'s business slowed in Europe's healthier core in the first quarter, a sign that European companies may be
tightening their purse strings.
"Our business is stabilized, I would say, in the south," John Wren, Omnicom's CEO, said on an April 18 earnings
conference call. "What we saw in the first quarter were setbacks in France and in Germany."
Meanwhile, the U.S. economy continues to bump along. GDP grew at an annualized 2.5% in the first three
months of 2013, and conditions are likely to stay choppy, as federal budget cuts and business caution provide a
counterweight to improvement in the housing and stock markets.
"Although the U.S. economy is poised for growth, it is being restrained somewhat," United Parcel Service Inc.
CEO Scott Davis said last week.
UPS's sales grew 2.3% in the quarter to $13.4 billion but still fell short of expectations.
Some investors are troubled by the weakness because they view revenue as a better gauge of global economic
health than profits. "The lack of revenue growth really doesn't justify new head count or capital expenditure," said
Jim Russell, senior equity strategist at US Bank Wealth Management. "This is one of the reasons we see a
stagnating sticky high unemployment rate."
Big companies have a lot of levers to pull to keep profits up, which has led to some unusual statistics. So far, 52%
of the S&P 500 companies that have topped Wall Street's first-quarter earnings expectations have missed on
revenue, according to Thomson Reuters. In a typical quarter, only 31% do.
They have pulled off that feat by holding down costs. Business spending on equipment and software rose just 3%
in the first quarter, down from an increase of 11.8% at the end of 2012, according to the Commerce Department.
With revenue in Europe declining, more companies are making plans to lay off workers, consolidate offices or
close plants. Ford Motor Co. plans to close three European factories by 2014. IBM is mulling up to 1,400 job cuts
over the next two years in France out of its 10,000 employees there, said a person familiar with the matter.
Dow Chemical Co. CEO Andrew Liveris warned that there are risks to cutting too deeply in Europe, but conceded
that Dow wouldn't be putting a "lot of new money" into Europe over the next few years. Dow's sales volumes in
Western Europe fell 12% in the quarter from a year earlier, pulling overall sales down 2.3%. Profit, however, rose
28% to $635 million.
Ford, which has been battered in Europe, said there may be light at the end of the tunnel, but its expectations
appear modest. "We still think there is a possibility of a stabilization of the European economy later in the year,"
said Ford CFO Bob Shanks.
---
Spencer E. Ante and Doug Cameron contributed to this article.
Document J000000020130429e94t0002t

The Secret Ingredient Is Ford Fusion
BEHIND THE WHEEL | 2013 LINCOLN MKZ

Automobiles; SECTAU
The Secret Ingredient Is Ford Fusion
By EZRA DYER
1,440 words
28 April 2013
The New York Times
NYTF
1
English
I'd like to make a confession: I'm a Lincoln owner.
I have a 2010 MKT EcoBoost and I love it. It has all-wheel drive, 355 twin-turbocharged horsepower and
three-row seating like a minivan. Its weird Art Deco-flavored styling is even growing on me. When every crossover
resembles a polished oblong river rock, the MKT stands out for at least trying to look like something else. Perhaps
that ''something else'' is a mutant baleen whale from outer space, but at least it's not another river rock.
More important, it's not a Ford Flex. The MKT is, to my mind, the most successful Lincoln because it's the one
that's least similar to its Ford counterpart. The Flex is square, but the Lincoln is rakish, and nobody will ever
confuse the two.
The recently renamed Lincoln Motor Company would do well to create such a distinction across its lineup, and the
2013 MKZ is a hopeful indication that Lincolns of the future will be stylistically removed from their Ford relatives.
The MKZ is based on the Ford Fusion, but the cars share no body panels. Informal man-on-the-street consensus
is that the MKZ looks great. But so does the Fusion and that, to me, points to the MKZ's biggest problem: despite
the distinctive bodywork, there remains a built-in sibling rivalry with Ford.
Lincoln certainly isn't the only company to spin multiple cars off the same platform. The MKZ's closest competitor
is probably the Lexus ES 350, which is a spiffed-up Toyota Avalon. But Lexus is in an enviable position regarding
brand cachet, in that it has some. Plenty of people would buy an ES 350 over an Avalon just to get that sleek ''L''
on the grille. On the other hand, I can attest that nobody spies a Lincoln badge and declares, ''Gee, somebody's
doing awfully well!'' So Lincoln has to try harder to offer something you can't get from Ford.
And it seems as if every time I note something positive about the MKZ, I realize that a similar plaudit applies to
the Fusion. The MKZ's standard 240-horsepower EcoBoost 4-cylinder is a punchy little motor, just as it is in the
Fusion. The 19-inch wheels fill the fenders with serious-looking low-profile rubber, just as the Fusion's 19-inch
wheels do. The Lane Keeper driver-assistance package is groundbreaking in that it will actively steer to keep you
in your lane, a feat that is equally impressive when the Fusion does it. Adaptive cruise control, blind-spot
monitoring, torque vectoring -- all great features. And all features of the Fusion, as well as the MKZ.
A few years ago I met with some Ford executives, who told me that the company's sell-off of its premium brands
(notably Volvo and Jaguar) meant that the regular Fords would no longer be denied luxury content. Gee, they
weren't kidding.
The front-wheel-drive MKZ that I tested had a retail price of $43,145. A similarly equipped Fusion would go for
about $35,000. So let's talk about how Lincoln justifies that extra $8,000. (I mean, besides hiring Emmitt Smith as
a ''brand ambassador'' and commissioning Jimmy Fallon to create a Twitter-sourced Super Bowl commercial.
What, you don't remember Lincoln's Super Bowl ad? Exactly.)
Other than its exterior styling, the MKZ offers several less significant divergences from its Ford cousin. The
Lincoln's leather, for instance, is definitely finer than the Ford's. The MKZ's Bridge of Weir hides make the Fusion
interior look as if it's upholstered in sun-bleached scraps of desiccated Naugabeast.

The Lincoln's giant sunroof, a $2,995 option, is quite cool, too, sliding down over the rear window like a jaunty hat.
It's the only sunroof I can think of where the size is measured in square feet (15.2). This thing's so big, it should
have a baseball field under it. Or a giant telescope.
Lest you fear frying in your rolling greenhouse, Lincoln says that with the roof closed, the SPF factor is more than
100. The car I drove had an even better SPF than that, because like 85 percent of MKZs it didn't have the big
sunroof.
Perhaps the oddest option is a $1,565 handling package that includes supercar-worthy Michelin Pilot Super Sport
tires. So equipped, an all-wheel-drive MKZ tested by Edmunds.com ran the slalom faster than the BMW M5.
Edmunds questioned who would buy a Lincoln so equipped, but I love the idea of a rarely ordered performance
package that transforms your Lincoln into an M5-beater in the corners. You know, not many people ordered ZL-1
Corvettes in 1969, either.
Fuel economy is decent but not exceptional, with the front-wheel-drive 2-liter MKZ carrying a rating of 22 miles
per gallon in the city and 33 on the highway. I had a hard time achieving 30 m.p.g., even on the highway. I know
this is a fairly big car, larded with luxury features, but 26 m.p.g. combined? A Honda Accord with a screaming
278-horsepower V-6 is rated at 21 city, 34 highway -- essentially equal.
I thought fuel economy was the whole point of small, turbocharged 4-cylinders. The Ford narrative is that the V-6
is obsolete in a midsize family car -- the Fusion no longer offers one. So then why does the MKZ options list
include a 3.7-liter V-6? If the logic is that the availability of a V-6 implies luxury, then I'm still confused, as this is
the same basic motor that powers thousands of base Mustangs and $24,000 F-150 pickups with vinyl floors.
Where's the 3.5-liter EcoBoost that so enlivens the MKT and MKS?
There's also an MKZ Hybrid that has an E.P.A. rating of 45 m.p.g. both in the city and on the Interstate. Of
course, you can also get a Fusion Hybrid. Which is actually different, in that it is rated 47 m.p.g. Curse you,
Fusion!
With active noise cancellation and a suspension system that continuously adjusts its dampers, the MKZ is quiet
and composed. The biggest shock comes when you try to put the car into gear and realize that there's no shift
lever or knob; control of the transmission is relegated to buttons on the dashboard. This is the kind of feature that
will probably impress occasional passengers while mildly annoying you, the owner, because you can't choose a
gear just by feel. The MKZ demands that you look at its buttons before you go anywhere.
Mostly, the MKZ comes across as a creative exercise in spinning two cars from one. It's as if two automotive Iron
Chefs were given the same ingredients but each concocted a slightly different dish. I made a soufflé of Fusion!
Well, I made a mid-lux MKZ casserole with an active-noise-reduction sauce and push-button-transmission
garnish.
The MKZ is great-looking and competitive with its peer set, but Lincoln would have done well to play it cool and let
the car win some accolades instead of pre-emptively acting as if it's the best thing since the 1961 Continental.
What Lincoln needs is at least one car to call its own, one model that you can't find on the Ford side of the lot --
say, stretch the Mustang platform into a four-door coupe and give it a 400-horsepower EcoBoost V-6. Until a car
like that arrives, the question attached to any Lincoln will be very simple: is this car different enough from its Ford
twin?
In the case of the MKT EcoBoost, I voted in the affirmative. I could even imagine talking myself into an
all-wheel-drive MKZ with the M5-baiting tires and an acre's worth of sunroof. That's a novel machine. But I fear
that the volume models, the front-drive 4-cylinders, will go forth to battle Lexus and end up fighting Fords instead.
MORE CHOICE: Although the MKZ is based on the midsize Ford Fusion sedan, the two cars share no body
panels. Unlike the Ford, the Lincoln offers an optional V-6 in addition to its EcoBoost turbo 4-cylinder. (AU1);
(PHOTOGRAPHS BY FORD MOTOR) (AU2)
Document NYTF000020130428e94s0006j

A Troubled Introduction for a Crucial New Model
Automobiles; SECTAU
A Troubled Introduction for a Crucial New Model
By PAUL STENQUIST
943 words
28 April 2013
The New York Times
NYTF
2
English
DETROIT -- The redesigned 2013 MKZ sedan was meant to herald a new era for Lincoln, the longtime luxury
division of Ford that was recently rechristened the Lincoln Motor Company. The MKZ's arrival, originally set for
the late fall of 2012, was ballyhooed in an expensive advertising campaign and an insistent public relations blitz.
Lincoln dealers started taking orders, but for the most part, MKZs didn't arrive in showrooms as scheduled. Nor
did they turn up in time for the showing of two Super Bowl commercials in early February. In fact, cars didn't ship
in substantial quantities until spring, roughly four months behind schedule.
''They missed the opportunity to strongly launch the brand,'' Michelle Krebs, a senior analyst for Edmunds.com,
said in a telephone interview. ''They did the big P.R. pitch; they did the big ad campaign. We saw a big spike on
Edmunds.com in shopping consideration. But then the vehicles didn't get to the dealerships, so the interest fell.''
Joe Phillippi, a former Wall Street analyst who is president of Auto Trends Consulting in Short Hills, N.J., said
losses from missed selling opportunities, wasted marketing efforts and the need to make amends with dealers
and customers were significant. He estimated the cost of the bungled introduction at $50 million or more.
Through the first quarter of 2013, Lincoln sold only 3,758 MKZs, according to Automotive News.
Asked in a telephone interview why dealers hadn't received cars on schedule, a Lincoln spokesman, Tom
Kowaleski, said that as production began at the assembly plant in Hermosillo, Mexico, the automaker ''found
some things of a fit, finish and detail nature that were not up to the standards we wanted to achieve.''
Those standards had been heavily promoted. At a media introduction of the car last November, Rich Kreder,
Lincoln's vehicle integration manager, said: ''The 2013 MKZ is projected to be a class leader in craftsmanship.
Our standards have never been higher.''
When cars coming off the assembly line didn't live up to that promise, thousands were shipped to a Ford plant in
Flat Rock, Mich., for unspecified repairs. Mr. Kowaleski said it was decided ''we would be better off bringing some
new parts into the vehicles.''
The automaker has declined to say what new parts were installed. In an interview, Jim Farley, Ford's group vice
president for global marketing, said: ''We're not going to be specific about what was an issue and what wasn't. All
I can say is that our commitment to quality hasn't changed.''
Asked what had been done to make amends for the delays, Mr. Farley said: ''In the first quarter of this year we
recognized that some of the delivery issues that we were having with MKZ were going to be an issue for some of
our dealers and our customers. We did what you would expect. Some loaner cars and lease extensions. For the
dealers, we took action to help support their profitability.''
Michael G. Kolb, the president of the nation's No. 2 Lincoln dealer, Hines Park Lincoln in Plymouth, Mich., said in
an interview at his dealership that the last-generation MKZ had accounted for 59 percent of his new-car sales.
The delayed deliveries of the new model had been painful, he said, but added that the company had been helpful
both in supporting profitability and placating customers.
A sales consultant at Hines Park, Joe Jenkins, added that the delay could be seen in a positive light. ''Before,
those cars would have ended up at the dealership and we would have fixed them,'' he said.
As of Thursday, MKZs were no longer being repaired at Flat Rock, according to Mr. Kowaleski. He said that to
date more than 10,000 MKZs had been shipped to dealers, and 200 more were going out every day.
While the MKZ is crucial to Lincoln, the automaker isn't relying solely on new products to revive the slumping
brand. Efforts to improve customer service, including a Web site that puts shoppers in touch with a Lincoln
concierge via webcam, are also part of the plan, and Lincoln has encouraged dealership upgrades.
I sampled the process by speaking with a Lincoln concierge, Michelle Bujold, on April 16. I asked if she could find
a red MKZ with a V-6 engine and all-wheel drive at a dealership near my home. She located one at Star Lincoln in
nearby Southfield, Mich., and set up a test drive. She later called to say that car had been sold, but similar
vehicles were in stock.
Indeed, on a visit to the dealership, I saw at least 20 MKZs on the front lot and took an unaccompanied test drive.
Patrick Leonhard, a sales consultant, told me he could quickly deliver a car with the equipment and paint I
specified.
Both Ms. Krebs and Mr. Phillippi said that most Lincoln customers would probably never know the automaker
hadn't delivered the MKZ on time, but that reinventing the Lincoln brand would require a continuing effort.
''They have to be in it for the long haul,'' Ms. Krebs said. ''They've been just totally in the doldrums. Luxury sales
are up, and Lincoln is down.''
LET'S HAVE BRUNCH: Part of the effort to burnish the Lincoln brand has been a push to upgrade dealerships. At
Hines Park Lincoln in Michigan, one of the nation's top Lincoln dealers, renovations included richly appointed
seating areas in the showroom and a sleek breakfast bar for customers. (PHOTOGRAPHS BY PAUL
STENQUIST)
Document NYTF000020130428e94s00066

Autos: Ford Thrives at Home, Drags in Europe
Autos: Ford Thrives at Home, Drags in Europe

By Jeff Bennett and Mike Ramsey
746 words
25 April 2013
J
B4
English
DETROIT -- Ford Motor Co. reported a 15% increase in its first-quarter profit as a record performance in the
North American division offset softness in other regions around the world.
The results highlight how Ford's strategic moves in the U.S. over the past 18 months are paying off. Among
those: expanding its car portfolio, refreshing its F-series pickup-truck line in a recovering economy, and reining in
incentives.
Ford earned $2.44 billion in pretax profit in North America during the first three months of the year -- a record
quarterly high since the company began breaking out North America results in 2000.
Net income increased to $1.61 billion, or 40 cents a share, compared with $1.4 billion, or 35 cents a share, in the
first quarter of 2012. Excluding one-time items, the auto maker generated profit of 41 cents a share, beating
analyst estimates of 37 cents a share. Revenue rose 10% to $35.8 billion.
"This is a very good start of the year for us," Ford finance chief Bob Shanks said in an interview Wednesday. "It is
encouraging to get off on a good step."
The auto maker took a hit in Europe, where the continued economic slowdown widened its loss to $462 million,
from $149 million for the same period a year earlier. Ford left unchanged its full-year outlook, which calls for a
loss of about $2 billion in Europe, compared with a loss last year of about $1.75 billion. The company plans to
close three European factories by 2014.
"We still think there is a possibility of a stabilization of the European economy later in the year," Mr. Shanks said.
"Quarter over quarter sequentially does suggest things are improving. We are starting to see things like the run
rate [of auto sales] in Spain, Portugal, Italy, Ireland and Greece bottoming out."
Analysts were bracing for news that Ford would reduce production in the region. The auto maker instead plans to
increase its output by about 21,000 vehicles from a year earlier to a total of roughly 390,000 for the next three
months.
In South America, Ford reported a pretax loss of $218 million due to currency changes and trade restrictions
imposed by Brazil and Argentina.
While South America has become a drag on Ford, its operations in Asia are finally producing a profit, albeit slim.
Ford had a pretax profit of $6 million for the quarter, compared with a $95 million loss a year earlier.
Ford is spending $5 billion to build plants in China to try to capture some of the growth in the world's largest
market. The heavy capital spending has dragged down profits there, and even a slightly positive result for the first
quarter is a sign that the region may soon be solidly profitable.
Despite the soft spots, most attention this quarter will likely be focused on North America, where Ford's market
share -- including Lincoln -- rose to 16.2%, according to Kelly Blue Book.
That is the company's highest first-quarter market-share number since 2010, when the now-defunct Mercury
brand was still in the mix.

The auto maker said it boosted first-quarter production in North America to 784,000, up 107,000 vehicles from
year-earlier levels. This quarter it plans to produce a total of about 800,000 vehicles, up 63,000 from a year
earlier.
Ford is scoring with the freshened Fusion and Focus sedans, but it is the F-series pickup that is really bringing in
the cash. The company sold 168,843 pickups last quarter, an increase of 17% from a year earlier.
Each truck on average sells for about $38,625, according to Kelly Blue Book.
Those pickups are expected to become more critical as the U.S. economy recovers and competitor General
Motors Co. looks to steal customers with its refreshed truck lineup due out later this year.
In another challenge, the company's North America operating margin dropped slightly to 11% in the first quarter,
which Mr. Shanks attributed to cost increases as the auto maker added more shifts at some of its plants and is
spending more on vehicle research and development.
Ford shares on Wednesday closed at $13.33, down 3 cents.
Document J000000020130425e94p00038

Autos: Europe Woes Dent Car Makers --- Profits at Volkswagen, Daimler and Others Hit by Region's Sluggish Markets
Autos: Europe Woes Dent Car Makers --- Profits at Volkswagen, Daimler and Others Hit by Region's
Sluggish Markets
By Vanessa Fuhrmans and David Pearson
882 words
25 April 2013
J
B4
English
Five of the biggest manufacturers in Europe's troubled auto industry reported a grim first-quarter performance in
the region, signaling the Continent's ever-shrinking car market is taking a toll on even its strongest competitors.
Among German auto makers, which so far have escaped the brunt of the crisis, Volkswagen AG said first-quarter
operating profit fell 26% from a year earlier -- blaming much of the drop on Europe's woes -- while Daimler AG
warned its operating profit would decline this year after the maker of Mercedes-Benz cars predicted stable
earnings just two months ago.
Meanwhile, PSA Peugeot Citroen, which reported a 6.5% drop in first-quarter revenue, warned it might have to
ratchet up its cost-saving efforts, including an early end to production at a factory near Paris. Europe also dented
the results of Ford Motor Co., which reported a $462 million loss in the region and said it still expects to incur a $2
billion loss there by year's end.
Renault SA said its revenue fell 12% in the first quarter as the European market contracted more than the
company had expected. It is sticking to its full-year targets, though, including higher unit sales and an operating
profit at its automotive operations.
Still, the earnings reports reflected a widening chasm between Europe's strongest and weakest auto makers as
the crisis-weary region's car sales approach a 20-year low. Despite "sluggish markets, especially in Europe,"
Volkswagen said it would stick to its forecast of higher sales and flat operating profit.
"We remain confident that we can pick up speed over the rest of the year," Volkswagen Chief Executive Martin
Winterkorn said in a written statement, triggering a jump in Volkswagen shares in afternoon trading. Shares in
Volkswagen rose 2.6% in Frankfurt.
Unlike Peugeot, Fiat SpA and other mass-market European rivals, Volkswagen has benefited from its broad
international reach and stable of auto brands -- particularly its luxury brand Audi, which like other premium auto
makers has fared better in Europe than mass-market manufacturers.
It also has profited from recent heavy investment in factories, technology, acquisitions and new models whereas
Peugeot, Europe's next-biggest auto maker by sales, is now reassessing its capital-spending plans to save cash
among other new cost-reduction measures.
Those varying levels of investment among European car makers are "probably a good indication of their futures
as much as it is an indication of their differing fortunes today," said Michael Tyndall, an analyst at Barclays Capital
in London. "It certainly draws the question around Peugeot and, to some extent, Fiat, and that is: Can you
compete if you're not spending?"
Daimler, too, said it expects its operating profit to improve in the second half, compared with the first, as it
launches a number of critical models, including a revamped version of its flagship S-class sedan -- one of the
company's main profit drivers.
But analysts caution that a big variable for Daimler and other German auto makers will be their home auto
market, which contracted an unexpected 13% in the first quarter. Until recently, it has been a rare bright spot for
car sales amid the gloom elsewhere in Europe.

Daimler on Tuesday issued its widely expected profit warning after first-quarter net profit fell 60% to 564 million
euros ($733 million) amid weaker-than-expected European car and truck sales and the company's continuing
efforts to repair recent stumbles in China. The company also cited increased spending on its new model
offensive.
Peugeot said a big drop in European sales contributed to a 6.5% fall in revenue to 13.03 billion euros from 13.93
billion euros in the same period last year. The company didn't release earnings figures.
Peugeot is one of Europe's auto makers most exposed to the unrelenting slide in sales in the region, which is
struggling to avoid another recession. New vehicle registrations sagged 10% in the first three months of this year.
That was the worst first quarter of any year since the European Automobile Manufacturers' Association started
keeping records in 1990.
EU car sales could fall 3.9% this year, according to consultancy IHS Automotive. IHS analysts expect a 6.9%
drop in Peugeot's home market.
The gloomy outlook raises questions about whether Peugeot management is reducing costs fast enough to stem
its monthly cash outflows. The first tangible benefits of a potentially wide-ranging cost-cutting alliance with
General Motors Co. kick in only at the end of this year, with the first major benefits due in 2015.
"Despite this challenging environment, we continue to focus on our recovery plan," Chief Financial Officer
Jean-Baptiste de Chatillon said. He said Peugeot will soon start talks with its unions on a new companywide labor
agreement to improve competitiveness, and reaffirmed the goal of raising 200 million euros this year from asset
sales after 654 million euros in 2012.
---
Jeff Bennett, Friedrich Geiger and Matthew Curtin contributed to this article.
Document J000000020130425e94p0000r

North American Sales Lift Ford's Results

North American Sales Lift Ford's Results
By BILL VLASIC
876 words
25 April 2013
The New York Times
NYTF
3
English
DETROIT -- The Ford Motor Company said on Wednesday that its net income improved 15 percent in the first
quarter to $1.6 billion, as record results in North America compensated for losses in Europe and South America.
Two other big automakers, Daimler and PSA Peugeot Citroën, said that they expected weak sales in Europe to
drag down their profits throughout this year.
Ford, the nation's second-largest automaker after General Motors, said its overall revenue grew 10 percent in the
quarter to $35.8 billion, and its market share continued to increase in the United States.
And despite unsettled economic conditions in international markets, the company reiterated forecasts that its
full-year profit would at least match its performance in 2012.
''Our strong first-quarter results provide further proof that our One Ford plan continues to deliver,'' said Alan R.
Mulally, Ford's chief executive.
Ford said that strong sales in its core North American market propelled the company to its 15th consecutive
profitable quarter.
The company's sales in the United States rose 11 percent in the first three months of this year, compared with a 6
percent increase for the overall industry.
In North America, Ford posted a pretax profit of $2.4 billion, a 14-percent improvement over the same period a
year ago. The company said it was the best quarterly performance since it began reporting the region as a
separate business unit in 2000.
The company has steadily rebuilt its product lineup in recent years, bringing out new versions of mainstay
vehicles like the Explorer sport utility vehicle and expanding production of smaller, more fuel-efficient cars like the
Focus.
But Ford, like most other major automakers, continued to struggle overseas in the first quarter.
The company reported a pretax loss of $462 million in Europe -- about triple the $149 million it lost in the region in
the first quarter of 2012.
Ford has said it expects to lose up to $2 billion this year in Europe, where weak economic conditions have driven
new-vehicle sales to their lowest level in decades. The company is closing a major assembly plant in Belgium and
accelerating other cost cutting in the region.
Other automakers indicated that troubles in the European economy might depress sales there for some time.
Daimler, the German maker of Mercedes-Benz luxury cars, said Wednesday that it was backing off its profit
forecast for this year because of conditions in Europe.
The French carmaker PSA Peugeot Citroën reported that its first-quarter sales dropped 10 percent because of
weak demand in Europe. The company said it hoped to start talks with labor unions on wages and working hours
in an effort to cut costs and improve competitiveness.
Ford's chief financial officer, Robert Shanks, said in an interview Wednesday that despite the sustained slide in
European sales, there were some ''bright spots'' in the Continent's economy.
''We are starting to see some signs that the overall economy may be starting to stabilize,'' Mr. Shanks said.
Auto sales in the most troubled markets in Europe -- in particular Greece, Italy, Portugal, Ireland and Spain --
appear to have hit bottom. ''Some of these markets have flat-lined, which is a good thing,'' he said. ''Before, they
were just dropping.''
While Europe continues to drag down Ford's results, the company is pressing ahead with plans to introduce
several new vehicles in the region.
Ford is also coping with a setback in South America, where it reported a pretax loss of $218 million, after earning
a profit of $54 million in the first quarter of last year. The company said currency issues in Venezuela and
Argentina depressed its results, but that it still expected to break even in the region for the entire year.
Results in Asia, where Ford is investing heavily in new factories and products, improved slightly. The company
said it earned a pretax profit of $6 million in the region compared with a $95 million loss a year ago.
One analyst said that Ford's overall performance showed that its turnaround was sustainable despite steep losses
in Europe.
''As a global company, Ford is buffeted by winds affecting each of the world's major markets,'' said Jack Nerad,
an analyst with the auto research site Kelley Blue Book. ''Most recently the North American market has been on
the mend and Ford has been buoyed by this trend.''
Unlike its domestic rivals General Motors and Chrysler, Ford was able to survive the recession without a
government bailout and a bankruptcy filing.
In recent years the company has increased the number of models built on global vehicle platforms, which saves
money on development costs. Ford is also streamlining production plans to reduce inventories.
Mr. Shanks said that Ford expected the United States car market to continue its recovery this year, with
industrywide sales of 15 million to 16 million vehicles. He added that sales of full-size pickups appeared to be
gaining momentum because of improved housing starts and other construction activity.
A Mustang at the Flat Rock, Mich., plant on April 17. Ford said overall revenue grew 10 percent. (PHOTOGRAPH
BY CARLOS OSORIO/ASSOCIATED PRESS)
Document NYTF000020130425e94p0005l

CFO Journal: The Big Number
CFO Journal: The Big Number

By Emily Chasan
333 words
23 April 2013
J
B6
English
22: Number of companies that account for half the cash and short-term securities held by nonfinancial firms in the
S&P 500
U.S. companies, as a group, are flush with cash, but an exclusive club holds most of that money.
Excluding financial firms, 22 companies held half the total cash and short-term marketable securities on the
balance sheets of companies in the Standard & Poor's 500-stock index, according to an analysis by
investment-research firm ValueBridge Advisors of financial data filed through March 3.
Cash holdings are further concentrated within that group. Just five companies -- General Electric Co., Microsoft
Corp., Google Inc., Cisco Systems Inc. and Apple Inc. -- accounted for 25% of the cash among the S&P 500's
nonfinancial companies.
U.S. companies held some $1.8 trillion in cash and liquid assets at the end of last year, according to the Federal
Reserve's latest flow-of-funds report, up nearly 30% from about $1.4 trillion in 2008.
"Investors see all that cash and ask companies about doing more dividends and buybacks, but corporate cash is
effectively concentrated in just a few hands," said Brian Barnier, principal analyst at ValueBridge. It's a case of
cash "haves and have-nots," he said.
Many of the largest cash holders are in the technology or drug industries, which frequently generate a lot of cash
overseas outside the U.S. because that is where they keep their intellectual property. But companies including
Ford Motor Co., Chevron Corp. and Comcast Corp. also belonged to the cash-rich club.
Cash-flow generation was also highly concentrated. Just 60 of nonfinancial S&P 500 companies produced 60% of
the index's net cash from operations, and about 10 companies were responsible for 25% of the index's cash flow,
the analysis found.
Document J000000020130423e94n0000a

Ford-G.M. Teamwork On Transmissions
WHEELS
Automobiles; SECTAU
Ford-G.M. Teamwork On Transmissions
By LINDSAY BROOKE
919 words
21 April 2013
The New York Times
NYTF
4
English
Ford Motor and General Motors announced on Monday that they would jointly develop new transmissions with 9
speeds for front-wheel-drive vehicles and 10 speeds for rear-drive cars and trucks. The new transmissions, with
more forward gear ratios than either company now offers, are expected to reach the market beginning in 2016.
The transmissions are considered vital components of the companies' efforts to meet upcoming standards for fuel
efficiency and carbon dioxide emissions in the United States and Europe. The transmissions will ''drive fuel
economy improvements into both company's future product portfolios,'' said Jim Lanzon, G.M.'s vice president of
global transmission engineering.
The automakers' announcement had been anticipated last October but was delayed over protracted negotiations
concerning intellectual property, according to sources familiar with the agreement. Reports of the pending alliance
first emerged in an article in the Automobiles section in September 2012.
The joint transmission development program builds on the companies' 2002 agreement that resulted in a 6-speed
automatic for front-wheel-drive vehicles.
While Henry Ford couldn't have foreseen this cooperative venture with General Motors when he said, ''Coming
together is a beginning; keeping together is progress; working together is success,'' the agreement does appear
to fulfill his vision regarding manufacturing efficiency.
By cooperating on design, engineering, and testing, the automakers are expected to save hundreds of millions of
dollars and considerable development time, said Skip Nydam, an industry analyst with ND-Automotive and a
former transmission engineer. It also saves the cost of licensing the design and production rights from a specialist
transmission supplier like ZF of Germany or Aisin of Japan, which can cost up to $100 per unit, according to
engineers at Ford and G.M.
''This collaboration provides sound economics and the flexibility both automakers need to meet the new fuel
economy laws,'' Mr. Nydam said.
In the 2002 deal, considered a landmark in the highly competitive auto industry, Ford and G.M. invested a
combined $720 million. They have since produced more than eight million transmissions -- the model is known as
the Ford 6F and G.M. 6T70 and 6T75 -- for nearly 30 models, including the Ford Fusion, Edge, Escape and
Explorer, and the Chevrolet Cruze, Malibu, Equinox and Traverse.
''We've already proven that Ford and G.M. transmission engineers work extremely well together,'' said Joe Bakaj,
Ford's vice president of powertrain engineering.
Based on their previous 6-speed experience, the automakers will share many common parts for the new 9- and
10-speed; manufacturing the transmissions will take place in each company's own plants. Software controls
developed separately by the two automakers will tailor the units to specific G.M. and Ford vehicles, giving each its
own performance and operating characterisitics.
The companies did not provide specific vehicle applications or technical details.

G.M. is understood to have contributed the basic design of the new 9-speed for front-drive vehicles, while the
10-speed's design comes from Ford. Jumping to 9- and 10-speeds from the 6-, 7-, and 8-speed transmissions
currently used across the industry improves the ratio spread -- the numerical relationship between lowest and
highest gears.
A large overall ratio spread makes it possible to achieve both lively acceleration and quieter highway cruising
without sacrificing either. The larger the number, the better: the new 9-speed, for example, is expected to have a
ratio spread close to 10:1, compared with a typical 6-speed's ratio spread of about 6:1.
At the same time, the added gears make it feasible to use a smaller ratio spread between adjacent gears -- for
instance, fourth and fifth gears -- to keep the engine revving at its best power level for a given road speed.
The additional gear ratios are seen as critical for use with the smaller, high-torque turbocharged engines that are
increasingly common in cars and trucks. Such engines are leading a trend known as downspeeding, which calls
for lowering engine r.p.m. to reduce fuel consumption.
With the new 9-speed, G.M. and Ford are following ZF, which unveiled the first production 9-speed automatic in
2011. The ZF transmission will be introduced in the 2014 Jeep Cherokee and the Range Rover Evoque. The ZF
9-speed is expected to offer up to 16 percent better highway fuel economy than 6-speed automatics, according to
ZF engineers.
Like its ZF counterpart, the joint G.M.-Ford 9-speed is expected to feature clever design of its internal
mechanisms aimed at making the transmission as compact as possible. This will be critical for fitting the new
gearbox into small cars like the Chevrolet Sonic and the Ford Fiesta. Currently these cars can fit only 6-speed
transmissions because of the limited width between their front wheels. The 10-speed, because of its longitudinal
installation in pickup trucks (where it is expected to be used in high volume), will not be as space-constrained as
the front-drive 9-speed.
Despite the added complexity of additional gearsets and clutches in the new 9- and 10-speed automatics, those
units are considered by many engineers to be more attractive than continuously variable transmissions. The
C.V.T.'s appear mechanically simpler but lack the high torque capacity of conventional automatics and cost more
to produce, say transmission experts.
This is a more complete version of the story than the one that appeared in print.
Document NYTF000020130421e94l0002w

Home & Digital -- Eyes on the Road: Changing Gears: Cars Ditch Familiar Shift Levers
Home & Digital -- Eyes on the Road: Changing Gears: Cars Ditch Familiar Shift Levers
By Joseph B. White
1,013 words
17 April 2013
J
D3
English
The 2013 Ram 1500 SLT is a beefy pickup with a 305-horsepower engine, a cab that stands more than 6 feet tall
and a bed that can carry more than 1,400 pounds of stuff.
To put this big rig into the first of its eight forward gears, you don't grab some industrial-strength steel shift lever.
You use two fingers to twist a plastic knob on the dashboard clockwise, from P to D.
The shift lever -- a device familiar to generations of car buyers -- is undergoing a rapid evolution. Some car
companies -- but not all -- are replacing traditional gear shifters in automatic-transmission vehicles with knobs,
push buttons or small levers, freeing up precious real estate in vehicle cabins for extra storage bins, smartphone
cradles, bigger cupholders or multimedia controllers. The new, lightweight controls do the job because automotive
engineers are increasingly getting rid of the nuts, bolts and cables that once were connected to the gear box and
instead are designing transmissions that use electronic circuits, switches and relays to control gear shifts.
Chrysler chief designer Ralph Gilles said designers for the Ram and other Chrysler models that are ditching shift
levers experimented with several approaches before settling on the Ram's "rotary e-shift" design.
"We spent more time on that knob than any knob I've worked on," Mr. Gilles says. Among the details: How to
calibrate the catch points, or detents in engineering-speak, that signal a driver who's not looking at the knob when
it's clicked past reverse or neutral.
The Ram's rotary shifter has garnered praise from some participants in online discussions. But there are
dissenters.
Shane Konzuk, 44 years old, says he special-ordered a 2013 Ram pickup with a six-speed transmission to avoid
the rotary-shift feature. Mr. Konzuk, who lives in Edmonton, Alberta, and uses his truck for work, says the new
eight-speed transmission is "smooth as silk." But he couldn't accept the dial. "It's too weird."
Some new cars that aim to project a technology-forward image, such as General Motors Co.'s plug-in hybrid
Cadillac ELR, still come with chunky shift levers positioned close to the driver's right hand, reflecting in Cadillac's
case a judgment that drivers will get more enjoyment from intuitive, familiar controls.
KBB.com asked visitors to its car-shopping website last week what sort of shifter they preferred. Of the 229 who
responded, 60% said they liked a shift lever in the console, and another 15% said they preferred a traditional shift
lever on the steering column.
Jaguar Land Rover PLC, has outfitted its latest XJ sedans with a shift knob that automatically rises out of the
console between the front seats to greet the driver with what the company calls a "handshake." The new Jaguar
shifter, and a similar rotary knob design offered on Land Rover's Range Rover Evoque model, are mated to a new
eight-speed automatic transmission made by ZF Friedrichshafen AG. Zed-F, as the company is known, also
makes the eight-speed in the Dodge Ram.
German luxury-car makers Mercedes-Benz and BMW have replaced console shift levers on some of their models
with small levers on the steering column that respond to the flick of a finger. The designs free up space in center
consoles for storage space and controllers that operate multimedia systems.
Ford Motor Co.'s Lincoln luxury brand has revived and updated the concept of push-button gear selection, last
seen in the U.S. in the early 1960s. The Lincoln system is designed to give the interior of the brand's 2013 MKZ
midsize sedan a different look from its mechanical sibling, the Ford Fusion.
The Fusion driver changes gears using a conventional, console-mounted shift lever. The MKZ owner will punch
buttons for park, reverse, neutral or drive that are aligned vertically on the dashboard to the driver's right.
The push-button design "is earmarked for Lincoln only," says Gary Braddock, interior chief designer for Ford and
Lincoln vehicles. Using the buttons allowed the MKZ's designers to put more storage space between the front
seats.
Rotary dials and buttons kill the romance of slamming a car through quick, high-speed gear changes. But few
drivers do that anymore. Even some of the most aggressively sporty cars on the market are abandoning
stick-style shifters. The new Lamborghini Aventador and Veneno super cars offer their drivers paddles on the left
and right sides of the steering wheel to change gears -- although the car will shift itself automatically.
Auto makers have leeway under federal safety rules to experiment with shift-selector designs. The basic gear
order must be Park, Reverse, Neutral, Drive, and a low gear, usually designated with an L. The movement to
Drive from Neutral must be a clockwise motion on a column mounted shifter. The standards don't mention dials or
paddles.
Jake Fisher, head of automotive testing for Consumer Reports magazine, says the newfangled designs can
present problems for drivers. Consumer Reports vehicle testers, who are in and out of a variety of vehicles during
a year, would sometimes accidentally shift cars into neutral when they intended to turn on the windshield wipers
because they mistook downsized shift levers for wiper-control stalks, Mr. Fisher says.
Car makers have taken steps to avoid potentially hazardous mistakes. Mercedes-Benz, for example, has
programmed cars to stop and go into Park when the door is opened, no matter whether the driver has correctly
engaged the Park button used on certain shifter stalks.
As for rotary dials and buttons, Mr. Fisher says they make it harder to do maneuvers like parallel parking or a
K-turn that require rapid and repeated shifts.
"There's all types of new ways of making simple things complicated," he says.
Document J000000020130417e94h0001g

GM, Ford team to develop 10-speed transmissions ; Teamwork saves money
MONEY
GM, Ford team to develop 10-speed transmissions ; Teamwork saves money
James R Healey; Chris Woodyard
James R. Healey, Chris Woodyard, USA TODAY
576 words
16 April 2013
USAT
FINAL
B.2
English
The latest auto race isn't on a track. It's under the car, unseen, in the transmission.
Ford Motor and General Motors, the two biggest of the Detroit 3, said Monday they will jointly develop nine- and
10-speed automatic transmissions, which could save fuel and improve performance, particularly with smaller
engines. Developing a new transmission is a complex and expensive project; joint development could save each
company hundreds of millions of dollars.
The automakers say their engineers already are at work but don't say when to expect the gearboxes, which will
share parts.
Companies legally can develop hardware together as long as they part ways to manufacture and tune it, as GM
and Ford say they will. Unaffiliated companies even have shared engines. Chrysler, Hyundai and Mitsubishi
jointly developed engines that they all used from 2005 to 2009.
The gear-speed battles seem a bit like the race to field the most cup holders or the most LED lights. But packing
as many ratios as possible into a vehicle's transmission case is about more than bragging points.
Done correctly, a transmission with more speeds improves mileage, performance or both by allowing the engine
to work more efficiently. How well a transmission works, however, depends not just on the number of gears but on
the software programming that controls it.
Chrysler Group is putting the first mainstream nine-speed automatics into the Dodge Dart and coming 2014 Jeep
Cherokee this year. And while seven- and eight-speed transmissions are common among luxury brands, Chrysler
is a pioneer at the moment for using eight-speed boxes in its mainstream big cars and, this year, Ram pickups.
It wasn't long ago that six-speed automatics were the new thing. In fact, Ford and GM collaborated on shared
six-speeds last decade. While both GM and Ford are trumpeting that as an example of their joint success, those
six-speeds got off to a rocky start.
GM used them in its big crossover SUVs, such as the Chevrolet Traverse and GMC Acadia. But it had to have
dealers reprogram the gearbox control software several times the first year because of complaints about poor
shifting.
Ford used its version in the Edge crossover SUV, among other models, but then-partner Mazda declined to
accept the box for its adaptation of the Edge, called CX-9.
To boost fuel economy, a many-speed gearbox can have several "overdrive" gears, which let the engine run very
slowly even though the car is speeding down the highway. For maximum performance, a gearbox with more
gears can be set up to try to always keep the engine revolutions at or near the spot where it makes the most
power. The art is to get the best of both approaches and to do so without annoying pauses or jerks, whether
shifting up or down.
Some car companies, such as Honda, Nissan and Subaru, are going a different route with automatics called
CVTs (continuously variable- ratio automatic transmissions). They have a belt-drive configuration that uses

variable-diameter pulleys to constantly adjust the ratio for what their designers believe is the correct setting for the
situation.
photo Richard Drew, AP The 2014 Jeep Cherokee Trailhawk. Chrysler is putting the first mainstream nine-speed
automatics in its 2014 Cherokees.
Document USAT000020130416e94g0001a

Corporate News: Ford CEO Revs Up Auto Maker's China Role --- Behind Rivals in the World's Largest Car Market, Company Is Making a $5 Billion...
Corporate News: Ford CEO Revs Up Auto Maker's China Role --- Behind Rivals in the World's Largest Car
Market, Company Is Making a $5 Billion Commitment on Continued Gains
By Mike Ramsey
1,009 words
16 April 2013
J
B7
English
SHANGHAI -- Just a few years ago, Alan Mulally, Ford Motor Co.'s chief executive, spent about 10% of his time
on matters related to China. These days, the world's largest auto market consumes about one-third of his and his
top lieutenants' schedules, each week.
The increased focus is significant for Ford's future because the company has a lot of ground to make up here. A
latecomer to China, the Dearborn, Mich., auto maker has about 3% of the Chinese market. Volkswagen AG puts
its share at 18.2% and General Motors Co. calculates its 2012 share at 14.6%.
Moreover, Ford is spending big to catch up. The company has committed to spending $5 billion to build five plants
in China to go along with the four it has now, and will need to increase its market share to be able to use all the
plants' output. The auto maker also is aiming to double the number of dealerships to about 800 by 2015, bring 15
new vehicles to China and launch the Lincoln brand here in 2014.
"Clearly this is going to continue to be the highest rate growth for us, both in revenue and profits, over the next
few years," Mr. Mulally said in an interview on the eve of this month's Shanghai auto show. "The entire team is
spending more and more time in Asia-Pacific."
On Monday, Ford Asia chief David Schoch predicted the company's market share here might reach 6% of sales
after Ford completes a model build-out in 2015.
Many foreign companies in autos and other industries are now getting a sense of the subtleties and complexity of
operating in modern China. In recent weeks, even long-established foreign companies with legions of Chinese
fans have run into unexpected difficulties.
Apple Inc. made a public apology recently after state-run media published reports about customer-service flaws.
Volkswagen was pressured into an expensive transmission recall after another Chinese television report called
into question the quality of its gearboxes. Likewise, Japanese auto makers are still struggling to regain sales after
a heated dispute over uninhabited islands in the East China Sea pummeled their sales in China.
After years of approving new auto factories, the Chinese government has become concerned about excess
production capacity and now tends to be more cautious about approving new plants. The government also is
keen to see domestic brands become more competitive with foreign makes, Mr. Mulally said.
Ford began producing cars in a Chinese joint venture in 2003, four years after GM and 18 years after Volkswagen.
The late arrival caused Ford to miss out on partnerships with the larger car companies in the coastal cities of
Shanghai and Beijing, where the bulk of car buyers have been in the past decade.
Ford has a joint venture with Chongqing Changan Automobile Co. in the country's interior. Ford is hoping to catch
a second wave of growth as economic development spreads to second- and third-tier cities, which tend to be less
wealthy than Beijing and Shanghai but still have huge populations.
In a reflection of its efforts to put China into the center of decision-making, Ford's U.S. management is shifting
U.S. meetings to early in the morning or late in the evening in order to better accommodate executives in China,
who are 12 hours ahead.

"We get up really early, we stay really late," said Mark Fields, Ford's chief operating officer, who recently ran a
business meeting in Shanghai until past midnight local time. "It gives us the sensitivity that we are a 24-hour
business."
The company soon will start producing a new 1.5-liter, four-cylinder engine that was developed in part to avoid a
Chinese tax of about $300 a year on vehicles with engines larger than 1.5 liters. The new engine will be sold in
markets around the world, including the U.S., beginning in September. It will be offered alongside a 1.6-liter motor
in some markets.
Mr. Mulally has decades of experience and many business and governmental contacts in China as a result of his
37 years at Boeing Co. and the last six at Ford. Two weeks ago, he was one of 100 delegates at the China
Development Forum in Beijing, a gathering that brought together China's new political leaders and CEOs from
around the globe.
"It was very exciting because we had all of the new Chinese leadership there," Mr. Mulally said. Deciding to push
forward with the $5 billion expansion was "one of the most important decisions we made six years ago. The
minute we made the decision, we were very focused on it, especially me."
He also makes visits to the Chongqing mayor's International Economic Advisory Council.
In the first quarter of this year, Ford's sales in China rose 54% over a year earlier, driven by its Focus compact. It
just started selling the Kuga sport-utility vehicle, a clone of the Escape SUV, and the larger Explorer SUV, which
is being exported to China this month.
Although GM and Volkswagen continue to expand in China, Ford is gaining on its Japanese competitors, which
have been hurt by the political backlash stemming from a dispute between China and Japan over islands in the
East China Sea. Toyota Motor Corp., Honda Motor Co. and Nissan Motor Co. have suffered declining sales amid
the tensions.
"You've got this situation where you have a whole bunch of Japanese brand [shoppers] looking for something
else," said Bill Russo, founder and president of auto consulting firm Synergistics Ltd. and a former
DaimlerChrysler AG executive. "Ford is really hitting its stride at the best possible moment."
Document J000000020130416e94g0000l

Corporate News: GM, Ford Team Up on New Transmissions
Corporate News: GM, Ford Team Up on New Transmissions

By Jeff Bennett
352 words
15 April 2013
J
B4
English
Copyright © 2013, Dow Jones & Company, Inc.
DETROIT -- General Motors Co . and Ford Motor Co . have teamed up to produce two transmissions as the auto
makers look to keep in step with their rivals both foreign and closer to home.
The two biggest U.S. auto makers have agreed to jointly develop a nine-speed and a 10-speed automatic
transmission for use in their portfolios of cars, crossovers, sport-utility vehicles and pickup trucks.
The transmissions -- to be built for both front- and rear-wheel drive -- are expected to improve vehicle
performance and increase fuel economy. Specific details weren't released on fuel economy improvement or
investment by each auto maker.
"The fact that Ford and GM are even considering working together on a set of new transmissions intended to
improve fuel-economy for both cars and pickups shows that auto makers are willing to consider just about
anything to continue to improve fuel-efficiency across their lineup," said Alec Gutierrez , a senior analyst at Kelley
Blue Book .
GM and Ford also need the technology to fend off their rivals who are already rolling out nine-speed
transmissions while working on future advancements.
Last month, Chrysler Group LLC unveiled its 2014 Jeep Cherokee at the New York Auto Show that goes on sale
late this year. The Cherokee will be equipped with a nine-speed transmission derived from a joint partnership with
German supplier ZF Group. The transmission is said to help the vehicle achieve a fuel economy of 31 miles per
gallon on the highway.
Daimler AG 's Mercedes-Benz and Tata Motors Ltd .'s Land Rover are also working to introduce nine-speed
transmissions into their next vehicles as soon as possible.
Engineering teams from Ford and GM have already started initial design work on these new transmissions. While
the basic structures of the transmission will be shared, each company will use their own software to ensure the
transmissions fit with the vehicles in their different brands.
Document J000000020130415e94f00037

Calling on a higher power ; Fusion Energi plug-in hybrid goes 21 miles on battery
MONEY
Calling on a higher power ; Fusion Energi plug-in hybrid goes 21 miles on battery
James R Healey
James R. Healey, jhealey@usatoday.com, USA TODAY
936 words
12 April 2013
USAT
FINAL
B.4
English
Ford added a plug-in hybrid to its Fusion midsize sedan lineup, and it really does go about 21 miles on the battery
before you need the gasoline engine.
Chevrolet Volt plug-in goes 38 miles before the battery needs help, so Energi (Ford's designation for plug-in
hybrids) isn't a record-setter. But it's roomier and more comfortable than Volt, and more fun to drive.
And it has Fusion's dramatic styling, which many (including Test Drive) think looks terrific.
Fusion Energi has two missions: to be a good car and to cut fuel use and the attendant costs. Before we comb
through those, let's be sure we're all on the same page:
A hybrid has a gasoline engine and an electric motor, tied together via the transmission. That saves fuel because
the gas engine runs less often, letting the electric do some of the work of propelling the car. There's no plug-in
feature. The batteries for the electric motor are recharged when the car slows and stops (called regenerative
braking) and by the gas engine running a generator, as needed. A hybrid can't go far on battery power only -- a
mile, maybe 3 -- because the battery pack isn't big.
A plug-in hybrid, such as Fusion Energi, has a much bigger battery pack, which dramatically increases weight,
cost and electric- only range. Plug-ins, also called PHEV (plug-in hybrid electric vehicles), can be plugged into a
household outlet to recharge their batteries, rather than relying only on regenerative braking and the gas engine.
The PHEV universe is small. In addition to the Fusion Energi and the Chevy Volt, the government recognizes the
Ford C-Max Energi, the Toyota Prius PHEV, and the Fisker Karma, currently out of production.
Government-listed ranges when the cars are running solely on battery power run from 11 miles for the Prius, 21
miles for the Fords, to 34 for the Fisker and 38 for the Chevy.
PHEVs coming within about a year, according to the government: Honda Accord (on sale in California and New
York since Jan. 15, nationwide this fall); Mitsubishi Outlander; Cadillac ELR; and Audi A3 e-tron.
Fusion Energi is special and priced at $40,000, more or less (mostly more). The bigger battery pack is mainly
why. Energi models are more lavishly equipped than corresponding normal hybrids, Ford notes.
As a car, Fusion Energi succeeds well, but is hardly perfect. Driving in electric-only mode works fine in urban and
suburban driving.
Electrics deliver all their power instantly, so the car squirts away from stoplights just fine. It's suitable for steady
state highway cruising.
But electrics have little left to give once the car is underway, so flooring the throttle at, say, 30 mph results in a
very sluggish increase in velocity. No diving and dancing through traffic, fast merging, quick passing.
In "auto" mode, Energi blends the gas and electric power like a regular hybrid. That provides plenty of
acceleration for most situations.

The gas engine even has a husky growl that some ears will find pleasing.
The car is hundreds of pounds heavier than others of its size, and that shows up over rippled asphalt, where
Fusion Energi seems to bound a bit, as if the suspension is working hard to control 2 tons of car.
Cornering, on the other hand, is normal. The reluctant feel of an overweight machine is diminished, and Energi
handles the "S" turns as well as an ordinary sedan.
The test car was a Titanium high-end version, and the interior was suitably sumptuous. Exceptional leather
upholstery pleasing to the eye and the tush; crisp, tasteful dashboard and interior layout and trim. Plenty of rear
legroom in the two outboard seats, but the middle slot's compromised by the center tunnel.
The Ford system of controls remains too awkward, but was manageable and didn't act up. It was, however, hard
of hearing when the driver tried to give voice commands with the climate control fan roaring, or windows down.
Not unusual, but shouldn't we be beyond that by now?
The high-end car has MyFordMobile. It lets your smartphone monitor the battery charge, find public recharging
stations, plan trips using electric-only mode and more.
You might never need the gas engine in normal use. Ford says 20 miles is an average commute, so by that math,
you could go one way entirely on the 21-mile battery range, plug in at work and go home on battery only.
Recharging after that battery-draining drive takes several hours and about $1 worth of electricity. In a gasoline
car, you might spend $3 on fuel for the same distance.
But if you run Energi until the battery's drained, then let it switch to the gas-electric mode, mpg will be in the 30s
or 40s. That's lower than a non-Energi Fusion hybrid, which is up to $11,400 cheaper but has virtually no ability to
run on battery only.
Test Drive believes alternative power vehicles should look and drive like normal cars to broaden their appeal
beyond fans. Fusion Energi passes that test with a high grade.
List
Ford Fusion Energi details
What stands out
Fuel use: Great as an EV, just OK as a hybrid
Price: Stiff
Trunk: Not much left after the big battery
photo Photos by H. Darr Beiser, USA TODAY

Document USAT000020130412e94c0000m

Who rules the world? Ford Focus, that's who ; For second year in a row, it's the global car sales champ
MONEY
Who rules the world? Ford Focus, that's who ; For second year in a row, it's the global car sales champ
Alisa Priddle; Chris Woodyard
Alisa Priddle, Chris Woodyard, USA TODAY
718 words
10 April 2013
USAT
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What was the best-selling vehicle in the world in 2012?
Americans might say a Ford F-Series pickup, since it's the perpetual top seller in the U.S. Others, recognizing
their international appeal, might say it's a Toyota Corolla or Honda Civic.
It's not. The world's best-selling car nameplate for a second year running is Ford Focus. More than a million were
sold in 2012, up from 879,914 in 2011, says Ford Motor, citing data from research service R.L. Polk. No. 2, also
for a second year, is the Corolla, a perennial leader that formerly topped the list.
Toyota, not surprisingly, wants a recount. It says that by its methodology, Corolla was No. 1 in 2012 with sales of
1,160,764. Toyota's total includes the Corolla sedan (90% of volume), along with Corolla variants such as the
Corolla Altis, Corolla Axio, Corolla Wagon, Corolla Fielder and Corolla Rumion models. It does not include
derivative models, such as the Scion xB, that don't have a Corolla badge.
Toyota says it is in contact with Polk to see how they arrived at a Corolla global sales figure nearly 300,000 fewer
than its total.
Only after those two then comes Ford F-Series trucks. Others in the top 10 -- such as Toyota Camry, Ford Fiesta,
Volkswagen Golf and Chevrolet Cruze -- underscore how global the auto industry has become.
The only vehicle on the list that's likely unknown to most Americans is a Chinese family hauler in fourth place, the
Wuling Zhiguang, made by a joint venture of General Motors and China's SAIC and Wuling.
The Focus' success appears to validate Ford's "One Ford" global strategy of designing, engineering, building and
marketing the same vehicles with the same names in all markets.
CEO Alan Mulally has repeated it like a mantra since he joined the company in 2006. Mulally found a composite
of regional products and business practices, then spent years changing Ford so Focus is built the same way at a
plant anywhere in the world in order to save money from economies of scale.
A car known by a single name anywhere in the world reduces cost and can boost brand equity. "As companies
build more vehicles locally, around the world, they are using a global name. Even in countries like China they are
not changing model names as much," said Haig Stoddard, industry analyst at Wards Auto.
Michael Robinet, managing director of IHS Consulting, said a single name helps in emerging markets. "With the
impact of the Internet and name awareness, there are definitely economies of scale and the ability to build brand
equity around the world," Robinet said. "When you pick a name that is universally accepted, like Focus or Corolla
or Fiesta or Beetle, it reduces marketing costs."
Chevrolet Cruze, for example, bears the same name everywhere but Australia, where General Motors sells under
the Holden brand, GM spokesman Klaus-Peter Martin said. But even there, it is the Holden Cruze.
Chrysler revived the Cherokee name for a new generation of what was the Jeep Liberty in the U.S., in part
because Liberty was sold elsewhere in the world as a Cherokee.

Even Ford still has naming discrepancies to address. In Europe, the Ford Escape is sold as the Kuga, and the
Fusion is sold as the Mondeo. But executives are considering single names in the future.
Ford sales analyst Erich Merkle said the Focus is particularly strong in the U.S. and China. Ford sold almost
246,000 in the U.S. last year, up 40%, and it was the 11th-best-selling vehicle in the U.S.
China now accounts for one in four Focus sales. Consumers there can buy a more affordable Focus "classic" (the
last-generation Focus) or the costlier current model. Ford invested $490 million in Chongqing to build the current
Focus.
Alisa Priddle reports for the Detroit Free Press
photo Operators at a Ford plant in Thailand put the finishing touches on the maker's 350 millionth Focus. Rogelio
V. Solis, AP
Document USAT000020130410e94a0000o

The 97-Month Car Loan
The 97-Month Car Loan

By Mike Ramsey
880 words
9 April 2013
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Last month Nakisha Bishop took out a loan to buy a $23,000 Toyota Camry and pay off several thousand dollars
still owed on her old car. The key to making it work: she got more than six years -- 75 months in all -- to pay it off.
"I had a new baby on the way, and I was trying to keep my monthly payment a little bit lower to help afford child
care," Ms. Bishop, a 34-year-old sheriff's deputy in Palm Beach County, Fla., said recently. She pays $480 a
month for the 2013 Camry, just $5 a month more than the note on her old car. The car won't be paid off until her
1-month-old daughter is heading to first grade.
Ms. Bishop's 75-month loan illustrates two important trends rippling through the U.S. auto industry. Rising
new-car prices and competition among lenders to attract borrowers is pushing loans to lengthier terms. In part,
banks see the longer terms as a way to attract buyers, by keeping monthly payments under $500 a month.
The average price of a new car is now $31,000, up $3,000 in the past four years. But at the same time, the
average monthly car payment edged down, to $460 from $465 -- the result of longer loan terms and lower interest
rates.
In the final quarter of 2012, the average term of a new car note stretched out to 65 months, the longest ever,
according to Experian Information Solutions Inc. Experian said that 17% of all new car loans in the past quarter
were between 73 and 84 months and there were even a few as long as 97 months. Four years ago, only 11% of
loans fell into this category.
Such long term loans can present consumers and lenders with heightened risk. With a six- or seven-year loan, it
takes car-buyers longer to reach the point where they owe less on the car than it is worth. Having "negative
equity" in a car makes it harder to trade or sell the vehicle if the owner can't make payments.
Car makers have mixed feelings about long-term loans. They allow consumers to buy more expensive -- and
profitable -- cars. But long loans may keep some people from replacing their cars, cutting into future sales.
Few lenders were willing to discuss the move to longer loans. Ally Bank, the largest car financier, declined an
interview request but said in a written statement: "Generally, the current economic and consumer environment is
more favorable for longer terms as compared with prior periods. . . The used vehicle market remains strong,
current vehicle quality also helps to maintain appropriate values, and consumer credit profiles are improving."
Credit availability has played a key role in the auto industry's ups and downs. During the financial crisis in 2008
and 2009, banks reined in lending dramatically, which made it hard even for consumers with good credit histories
to buy cars. For the last three years, auto sales have been rising, helped as banks have eased credit standards
and became more willing to offer longer term loans.
Experts say there is an appetite for more risk because banks see limited downside in auto lending. The
delinquency rates on car loans are near record lows, and used car values are at record highs. And if a buyer
defaults, the bank can repossess and sell cars with limited losses.
Melinda Zabritski, director of automotive credit for Experian, said the greater availability of credit is helping the
surge in new car sales. The percentage of subprime loans isn't far below the record level of 2007, and the length
of loans is growing, she said.
And while the length of the loan may seem long, the average age of a vehicle on the road today is 11 years.
Vehicle durability continues to improve and used vehicles don't depreciate in value as fast as they used to.
With increased competition between the banks for business, offering loans longer than 72 months, or subprime
loans is one way to compete for new borrowers. "Consumers tend to be monthly payment buyers. One way that
lenders compete is to offer longer term loans," Ms. Zabritski said.
She said that people who get the longer loans tend to have good credit scores, and are buying relatively
expensive vehicles.
Ford Motor Credit, the in-house lending arm for Ford Motor Co., has averaged between 59 and 60 months on new
car loans for the past five years. Beyond the added risk, longer loans keep buyers from coming back as often,
said Margaret Mellott, a spokeswoman for Ford.
"We don't want to keep buyers out of the showroom longer than that," she said.
The length of loans has come a long way since Lee Iacocca, then a Ford regional manager, helped pioneer auto
loans in the 1950s. He became a management star by developing a '56 for $56 sales pitch. The idea: consumers
could buy a 1956 Ford for 20% down and $56 a month. The loans were paid off in just 36 months.
Document J000000020130409e9490003b

Police Car Company Abandons Offices
WHEELS
Automobiles; SECTAU
Police Car Company Abandons Offices
By TUDOR VAN HAMPTON
568 words
7 April 2013
The New York Times
NYTF
8
English
The small town of Connersville, Ind., has closed the books on the Carbon Motors Corporation, an Indiana start-up
that had moved to town in 2009 to manufacture and sell police vehicles, but was turned down last year for an
Energy Department loan.
''I assume that they are done here,'' Mayor Leonard Urban of Connersville said Wednesday morning in a
telephone interview. He said the company's lease with the town on a 1.8-million-square-foot building had expired
on Sunday, and Carbon employees had packed up last month.
Carbon had leased office and factory space at the building that the Visteon Corporation had used to manufacture
air-conditioning compressors for Ford and Lincoln. Carbon had asserted to have taken more than 20,000 orders
for its E7 police cruiser, which would have a BMW 6-cylinder turbodiesel engine. The car was offered at a crucial
moment when the Ford Motor Company was discontinuing the Crown Victoria.
Unlike that older police-vehicle platform, the E7 had futuristic styling, custom features and high performance that
could appeal to police officers of the RoboCop-movie generation.
Carbon promised to create some 1,500 new manufacturing jobs in Connersville, which is about an hour east of
Indianapolis.
''This town needs jobs,'' Mr. Urban said. ''We've lost 10,000 industrial jobs in the last 15 years.
''The town had an agreement with them that at the end of March, if they didn't renew, the lease was up,'' said Mr.
Urban, who added that he had received only one message, an e-mail from Alan Bratt, Carbon's manufacturing
chief, thanking the mayor for his support.
''I understand that all the principals have left the company,'' Mr. Urban added. Efforts by The New York Times to
reach Carbon Motors executives by telephone and e-mail were unsuccessful. The company has shut down its
Web site.
The company in March 2012 lost a crucial piece of financing it had sought from the Energy Department. After the
agency denied a $310 million loan application under the Advanced Technology Vehicle Manufacturing program,
Carbon executives blamed politics.
''We are outraged by the actions of the D.O.E., and it is clear that this was a political decision in a highly charged,
election-year environment,'' William Santana Li, Carbon's then chief executive, said in a statement issued after
the decision.
Automotive executives and others also claimed that the Advanced Technology Vehicle Manufacturing loans,
which were earmarked for new, fuel-efficient vehicles, dried up amid the bankruptcy of Solyndra, the solar-panel
maker. Bright Automotive, another Indiana start-up, closed after failing to receive an Energy Department loan.
''Suddenly, I think we got caught up in presidential politics,'' Mr. Urban said. ''They weren't going to let another
loan go bad before the presidential election.''

Carbon tried to raise addition money last year by unveiling the TX7 riot van, which was to cost about $150,000.
The V-8 turbodiesel truck was to go into production this summer.
Mr. Urban says there has been strong interest in the abandoned site.
''There is a little upswing in manufacturing right now, and I think eventually it will be sold.''
The E7 police cruiser. (PHOTOGRAPH BY CARBON MOTORS)

Document NYTF000020130407e94700020

Automakers pick up speed after long slog
Business
Automakers pick up speed after long slog
1,246 words
7 April 2013
The Washington Post
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Copyright 2013, The Washington Post Co. All Rights Reserved
U.S. auto sales in March hit their highest monthly total since August 2007, as everyone from oil and gas
producers to local home builders raced to replace the aging trucks they held on to during the recession. The big
sales drivers were the Ford Fusion, Cadillac ATS (GM) and Ram pickup truck (Chrysler). General Motors, Ford
and Chrysler sold a total of 154,722 full-size pickups, up 14 percent from a year ago. Overall auto sales rose 3.4
percent from March of last year.
Apple, Google and five other companies won a court order to block potentially thousands of employees, from
engineers to sous-chefs, from proceeding in a group lawsuit that contends that their incomes were held down by
the companies' agreements not to recruit one another's workers.
Ron Johnson, chief of struggling J.C. Penney, had his total compensation cut to $1.89 million last year. The
former Apple retail chief was awarded $53.3 million in salary, bonus, stock awards and other compensation in
2011, when he became the retailer's head.
Facebook has made its most significant foray into smartphones, with Home, a suite of applications that put a
user's Facebook page on the home screen of Android smartphones. Consumers would be able to instantly see
updates from their Facebook friends and quickly reply to network messages.
Samsung Electronics, stepping up a battle with Apple, will staff mini-stores at Best Buy's U.S. locations to
showcase how its tablets, smartphones and televisions work together.
Wells Fargo's bid to have an investor lawsuit against it dismissed was rejected by a federal judge. The suit
alleges that the bank failed in its role as trustee for debt issued by Capital Holdings, a financing company that
collapsed in 2009 in an estimated billion-dollar fraud.
Bank of America will pay $165 million to settle a dispute over mortgage-backed securities it sold to credit unions
that later collapsed, according to the National Credit Union Administration, the agency that regulates credit
unions.
Genworth Mortgage Insurance, United Guaranty, Mortgage Guaranty Insurance and Radian Guaranty were fined
a total of $15.4 million by the Consumer Financial Protection Bureau for paying millions of dollars in kickbacks to
home lenders in exchange for business, raising insurance prices for consumers.
Cameron International was dismissed from all claims arising from BP's 2010 Gulf of Mexico oil spill after a judge
said there was no evidence showing that the company was at fault for the disaster. Cameron made the blowout
preventer that was designed to stop explosions in BP's oil well. Witnesses testifying at a New Orleans trial over
fault for the disaster have said the blowout preventer wasn't properly maintained by the Transocean crew
manning the drill rig.
A former Goldman Sachs trader, Matthew Marshall Taylor, pleaded guilty to wire fraud, admitting that he caused
his company to lose $118 million in 2007 when he put $8 billion at risk. According to court papers, Taylor entered
fictitious information in trading account records and lied to company representatives to cover up the fact that he
had put 10 times more money at risk in the trade than he was allowed. He said the $8 billion at risk was only $65
million.

A U.S. appeals court revived a lawsuit by the former wife of Steven A. Cohen, founder of hedge fund SAC Capital
Advisors, who accused the billionaire of hiding $5.5 million from her during proceedings that led to their 1990
divorce.
General Motors, planning to invest $1.5 billion in North America this year, said it will spend $332 million at four
factories to prepare for new, more fuel efficient engines and transmissions.
Apple chief executive Tim Cook apologized to Chinese consumers for its iPhone warranty policies after weeks of
condemnation of its after-sales service in China's state-run media.
Wal-Mart is cutting gasoline prices by up to 15 cents a gallon for drivers in 21 states who pay with its cards in an
attempt to woo shoppers grappling with high prices at the pump. U.S. sales have slowed in 2013 at the world's
biggest retailer as customers feel the pinch of higher gasoline prices, higher U.S. payroll taxes and delayed
income tax refunds.
CVS Caremark agreed to pay $11 million to settle federal claims that its Oklahoma pharmacies violated
recordkeeping requirements of the Controlled Substances Act. Some of CVS's 46 pharmacy retail stores in
Oklahoma created false federal registration numbers that were sometimes provided to state prescription drug
monitoring programs, according to the claims. CVS did not admit liability.
American Airlines and Orbitz Worldwide settled their litigation over competing electronic flight-data systems.
Orbitz was the last defendant in a lawsuit accusing it, Sabre Holdings and Travelport of conspiring to block the
airline's entry into the electronic flight-data and reservations market.
American Greetings agreed to be taken private by a group led by some of its top executives, including Chairman
Morry Weiss, in a deal that values the company at about $580 million.
The U.S. economy will face the brunt of massive federal spending cuts just as growth in private sector jobs is
plunging, according to government data. Businesses created a paltry 88,000 jobs in March - less than half what
Wall Street expected. The jobless rate dropped to 7.6 percent.
Unemployment across the 17 European Union countries that use the euro in February hit 12 percent for the first
time since the currency was launched in 1999.
U.S. factory orders rose 3 percent in February. That's up from a 1 percent decline in January and the biggest gain
in five months. The increase was caused mostly by a jump in orders for commercial aircraft.
Companies hired at the weakest pace in five months in March as recent strong demand for construction jobs
evaporated and growth in the vast services sector slowed, signs that the economic recovery could be hitting a soft
patch. Private employers added 158,000 jobs last month, falling short of economists' expectations for 200,000.
Spending on U.S. construction projects rebounded by 1.2 percent in February, helped by a surge in home
construction, which rose to the highest level in more than four years.
A $2 billion search for foreclosure errors was hampered by poor planning from federal regulators, the Government
Accountability Office said.
Companies can use social media such as Facebook and Twitter to unveil key information about their operations,
the SEC said.
Roger Ebert, the Pulitzer Prize-winning film critic famous for his thumbs-up, thumbs-down judgment of movies,
died at age 70.
Mary Schapiro accepted a position at Promontory Financial, a premier financial services consulting firm, her first
private-sector job after nearly four years as SEC chairman.
World Bank President Jim Yong Kim called climate change a "fundamental threat" to global economic
development.
James E. Hansen, an outspoken scientist on the issue of global warming, is stepping down from his NASA post to
work full time in activism on the issue.
Alzheimer's is the nation's most expensive disease, costing families and society $157 billion to $215 billion a year,
a study said.
The first results from a $2 billion instrument aboard the international space station have offered tentative support
for the theory that invisible dark matter permeates the universe.
WP20130407Recap0407
Document WP00000020130407e9470002j

Corporate News: Battery Fires Fail To Rattle Car Makers
Corporate News: Battery Fires Fail To Rattle Car Makers

By Yoree Koh
685 words
4 April 2013
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TOKYO -- Two incidents last month of lithium-ion batteries in Japanese cars burning or melting ended a multiyear
streak of safe operation for the technology's use in cars, but not auto makers' support for the power packs.
Japanese and U.S. car makers insist the safety record of automotive lithium-ion batteries reflects years of
cautious development, despite the recent incidents in Mitsubishi vehicles and Boeing Co.'s 787 Dreamliner fleet.
Mitsubishi Motors Co. said last month that a lithium-ion battery pack for its i-MiEV electric car caught fire while
charging during a test inspection at the company's plant on March 18. Three days later, the lithium-ion battery
installed in a hybrid Outlander overheated and melted the cell and part of the battery pack when a new-car dealer
tried to move the car.
According to the transport ministry, Japan has never before had a problem with lithium-ion batteries overheating
in cars shipped inside the country.
Honda Motor Co., Nissan Motor Co., Toyota Motor Corp., General Motors Co., and Ford Motor Co. defended their
use of the battery technology.
"Honda has conducted plenty of safety tests and created safe designs of its [lithium-ion battery technology]. There
have been no outbreaks of fire or burning incidents from the battery at Honda," a spokeswoman said. A Nissan
spokesman added: "To date, more than 54,000 Nissan Leaf vehicles have been sold worldwide and all have
performed without serious incident."
GM and Ford, whose Chevrolet Volt, Ford Fusion, C-Max hybrids and Focus Electric use lithium ion technology,
say their batteries are safe. Last year, the U.S. National Highway Traffic Safety Administration said there was no
evidence the Volt was prone to catching fire after a probe of a fire in a vehicle whose battery leaked fluid and
short-circuited after a crash test. "We haven't seen any issues experienced by others," said Ford spokesman
Jason Lasecki.
The batteries that caused problems at Mitsubishi were manufactured by Lithium Energy Japan, a joint venture
between Mitsubishi Motors, Mitsubishi Corp. and GS Yuasa Corp., the same company that makes the lithium-ion
batteries at the center of Boeing's Dreamliner woes.
GS Yuasa spokesman Hiroharu Nakano said the battery design is completely different from the one used on the
Dreamliner and manufactured at a different site. He said the three companies in the venture have set up a joint
team to investigate the cause of the problems.
Battery experts say those incidents are the exception rather than the rule. "Japanese auto makers have a long
history in developing batteries," said Akihiko Kido, research director of the fuel cell and electric-vehicle research
division at the Japan Automobile Research Institute, which helps set industry standards for new-vehicle
technology. "So the technology has been developed in gradual increments over time."
Japan's auto makers have been at the forefront of the industry's foray into hybrid and electric vehicles, a growing
number of which are installed with lithium-ion batteries.
Mitsubishi Motors' i-MiEV became the world's first mass-produced electric car in 2009, followed by the Leaf from
Nissan. Rivals Honda and Toyota currently have four and three models, respectively, that use lithium-ion
batteries.

Toyota says it overcame an early skepticism of the technology. "In the early stages, there was a strong feeling
[within Toyota] that it would be very difficult to use the lithium-ion battery in cars," said Shoichi Kaneko, the
engineer who was in charge of Toyota's plug-in hybrid vehicle development.
To get comfortable with the technology, Mr. Kaneko said his engineers "bullied" every part of the battery.
The engineers dropped a new battery from varying heights and punctured a used one with a nail. Toyota built 750
test vehicles to see how they behaved in real-life scenarios over a cumulative 10 million kilometers (6.21 million
miles).
---
Mike Ramsey contributed to this article.
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Corporate News: U.S. New-Car Sales Climb Sharply --- American Firms' Gains Outstrip Japan's Big Three
Corporate News: U.S. New-Car Sales Climb Sharply --- American Firms' Gains Outstrip Japan's Big Three
By Jeff Bennett
702 words
3 April 2013
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General Motors Co., Ford Motor Co. and Chrysler Group LLC reported their strongest March sales in five years,
prompting one research firm to lift its full-year forecast.
GM's sales rose 6.4% from a year earlier, while Ford's climbed 5.7% and Chrysler's were up 5%, bolstered by
rising consumer confidence amid healthy stock and housing market gains in recent months.
Overall, March adjusted annualized sales jumped 8% to a 15.3 million vehicle pace, compared with 14.1 million a
year ago, according to market researcher Autodata Corp. The gains prompted automotive information website
Edmunds.com to increase its 2013 U.S. sales forecast to 15.5 million new cars and light trucks, from 15 million.
"Even though consumer confidence has been up and down so far this year, there are 'wealth effects' that are
making Americans feel comfortable finally buying the new cars they've been waiting for," said Edmunds.com chief
economist Lacey Plache.
Strong demand for cars and trucks helped Detroit outrun Japanese auto makers. Toyota Motor Corp. and Nissan
Motor Co. posted just 1% gains while Honda Motor Co. said its March U.S. volume rose a less-than-expected
7.1%. Japanese car makers are seeing tougher competition from U.S., German and South Korean rivals.
"The midsize and compact segments have become a major area of focus for the domestic auto makers and this
has eaten into sales volume that was typically reserved for Toyota, Honda, and Nissan," said Alec Gutierrez, a
senior analyst at auto pricing service Kelley Blue Book.
Analysts said overall demand was boosted by higher average sales incentives, which climbed 11% industrywide
from a year ago, according to Edmunds. Chrysler lifted its incentives nearly 30% to an average $3,228 to move its
aging cars.
Gary Flom, chief executive of Bay Ridge Ford in Brooklyn, N.Y., said there was a steady flow of customers
through his dealership all month. Mr. Flom said he sold about two dozen more vehicles in March compared with
the same month a year ago.
GM sold 245,950 vehicles in March, up from 231,052 a year earlier and 9.6% above February's tally. Chevrolet
sales were up 0.5% from a year earlier and GMC brand sales increased 12%. Buick sales climbed 37% and
Cadillac sales jumped 49%.
GM in February reported it earned money for the third-straight year as a financial boost from North America and
other regions offset wider losses in the auto maker's European business.
Ford's F-150 series retook the pickup truck crown from GM's Chevrolet Silverado and GMC Sierra. GM had
bested Ford in February. Ford sold 235,643 cars and light trucks, up 5.7% from a year earlier. Its Escape
crossover increased 28% while Fusion sales climbed 6%, crossing the 30,000 sales mark for the first time. Still,
its Lincoln brand dropped 22%.
Chrysler, a majority-owned unit of Italy's Fiat SpA, said it sold 171,606 vehicles, aided by a 21% increase in
passenger-car sales. Sales of the Dodge brand were up 15% while Jeep sales fell 13% on model changeovers.
Ram truck sales rose 24%, but total truck sales declined 2.1%.
Jonathan Browning, Volkswagen's U.S. chief, cautioned results remain uneven. "The potholes and bumps are still
there," he said after VW reported a 3.1% increase in its March U.S. sales. "We don't see a steady pace in sales
throughout the whole country. It is still patchy. Texas, for example, has only picked back up after a strong fourth
quarter. It won't be until later in the second quarter that we see things more clearly."
Germany's luxury-car sellers reported healthy demand. Daimler AG's Mercedes-Benz unit said its U.S. namesake
brand sales rose 6.5%, BMW AG's namesake brand rose 13% and Volkswagen AG's Audi was up 14%.
---
Melodie Warner contributed to this article.
Document J000000020130403e94300034

Corporate News: GM Ups Ante in Truck Rivalry --- Auto Maker Claims Its New Pickups, Coming Out in June, Will Best the Gas Mileage of Ford's...
Corporate News: GM Ups Ante in Truck Rivalry --- Auto Maker Claims Its New Pickups, Coming Out in
June, Will Best the Gas Mileage of Ford's F-150s
By Jeff Bennett
596 words
2 April 2013
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The pickup truck mileage war is on, with General Motors Co. claiming on Monday its coming eight-cylinder
Chevrolet Silverado and GM Sierra pickup trucks will go farther on a gallon of gasoline than Ford Motor Co.'s
six-cylinder F-150 trucks.
The Silverado two-wheel-drive model and the four-wheel-drive version, powered by the company's 5.3-liter
EcoTec3 eight-cylinder engine, each will go one highway mile farther than the F-150 with a turbocharged
six-cylinder engine.
GM said its two-wheel-drive version is rated to achieve 23 highway miles per gallon while the four-wheel version
would get 22 mpg.
The revamped 2014 Chevrolet Silverado and GM Sierra pickup trucks are due out in showrooms in late June. The
5.3-liter EcoTec3 eight-cylinder engine is an $895 option.
The disclosure escalates a continuing fuel-economy battle between GM and Ford as both fight to dominate the
lucrative pickup truck market. Auto makers earn about $8,000 in profit on each full-size pickup sold. GM needs to
retake the pickup truck crown if it hopes to bolster its profitability and slow its market erosion in the U.S.
"We have continuously demonstrated that we will improve our trucks, and it doesn't matter what the competition
does," said Mike Levine, a Ford spokesman.
Auto makers also are being squeezed by the U.S. government and consumer shopping habits to provide better
fuel economy. The U.S government has mandated that an auto maker reach an average 54.5 miles per gallon for
their vehicle portfolio by 2025.
"Power and fuel economy is at the top of the list all the time," said Jeff Luke, chief engineer for Silverado and
Sierra. "It's at the top of the list all of the time and we want to no compromises here."
Monday's announcement by GM may narrow the sales and marketing gap Ford created in 2010 when it began
equipping its top-selling F-150 trucks with a six-cylinder turbocharged engine it calls the EcoBoost. The engine
provides the power of an eight-cylinder engine but delivers 20% better fuel efficiency and reduces emissions by
an estimated 15%.
EcoBoost engines also have given Ford a major marketing platform. About half of F-150 buyers are choosing the
EcoBoost engine option.
GM also said the base starting price on its 2014 Silverado regular cab, crew cab and extended cab would remain
unchanged from the previous model year. The regular cab base price, for example, will continue to start at
$24,858.
The Sierra's starting price will be $25,085, about $500 more than the current model.
The unchanged pricing could represent a challenge for GM, which seeks to close the price gap with Ford. GM's
average pickup transaction price is about $35,000 while Ford is close to $37,700.
Mr. Luke said he expects to squeeze more dollars from customer wallets as shoppers decide to buy more crew
cabs and opt for other perks such as higher-level trim, lane-departure warning systems and park assistance.
The auto maker estimates sales of crew cab models -- which generally seat five -- will jump to 60% of units from
50% for Silverado and 65% from 60% for Sierra.
Document J000000020130402e9420000p

Another Sport Franchise for Ford
AROUND THE BLOCK

Automobiles; SECTAU
Another Sport Franchise for Ford
By JAMES SCHEMBARI
763 words
31 March 2013
The New York Times
NYTF
5
English
TESTED 2013 Ford Explorer Sport
WHAT IS IT? An Explorer with an attitude.
HOW MUCH? $41,675 base; $46,245 as tested.
WHAT MAKES IT RUN? A 3.5-liter twin-turbo EcoBoost V-6 producing 365 horsepower and 350 pound-feet of
torque; 6-speed automatic transmission.
HOW QUICK IS IT? Car and Driver tested the Sport at a fleet 5.9 seconds from 0 to 60 m.p.h.
IS IT THIRSTY? Like a freshman at a frat party: the federal rating is 16 m.p.g. in the city and 22 on the highway.
ALTERNATIVES Ford Flex Limited EcoBoost, Dodge Durango R/T, BMW X5 xDrive 35i; in the upper reaches,
the Jeep Grand Cherokee SRT8, Range Rover Sport HSE and Porsche Cayenne S.
Forming a quick opinion from a first impression is bad enough, but forming that opinion before you've met is bad
manners. So forgive me for disliking the very idea of the Explorer Sport even before it blocked out the sun in my
driveway.
Whose idea was it to take a sizable S.U.V. and negate its basic purpose -- to haul multiple people to places
unreachable by a car -- by stuffing in high-output engines, accessorizing the cabins with city-slicker frills and
bolting on flashy oversize wheels?
Having said that, here's my more mature second impression of the Sport, now that we've met: nice truck.
Ford starting slapping the Sport name on two-door Explorers in the mid-1990s, and although the name implied
performance, Sport was just a label. The 2013 version, however, lives up to its name, with more power and better
handling than the base Explorer. The engine is the same one found in the performance-oriented SHO version of
the Taurus sedan, and it is also available in the Flex crossover and the F-150 pickup.
At 4,921 pounds and with seats for seven, the Explorer Sport is big and quick. When you first get in and roll away,
you can be forgiven for thinking you'll be riding a refrigerator down a toboggan run. But Ford realized it couldn't
put all that power into the Explorer and just walk away. The chassis has been reinforced with stiffer springs and
shocks, the steering is quicker and the brakes are larger. There is continuous all-wheel drive and wide 20-inch
tires with plenty of grip.
The all-season Continental tires look aggressive paired with the black-accented wheels that, along with the black
grille, tell your neighbors this is no ordinary Explorer.
My neighbor, however, didn't get the message. When he dropped by to look over the truck, he said he was
considering the Explorer, but found it underpowered. Not this one, pal.

I took the Sport from Connecticut to Charlotte, N.C., for my son's college graduation. The Ford proved roomy,
comfortable and well appointed, with leather-trimmed seats. The ballroom-size cargo area, especially with the
third row folded, can fit a dorm room's worth of stuff.
On the highway and on twisty country roads, the Sport was a great companion that didn't protest when, using the
paddle shifters, I treated it like a sport sedan. It felt planted and composed, even when surrounded by trucks
during the driving rainstorm that followed us home.
And I have to admit, it was satisfying to surprise other drivers when I clicked a two-gear downshift to pull away
from the crowd. When pushing this beast at speed, I felt like one of General Patton's tankers rushing to relieve the
troops at Bastogne.
Of course, fuel economy is the humbug that haunts S.U.V.'s like this. Even with the efficient EcoBoost, the truck
inhales gas.
A few years ago, I took two trips to North Carolina in diesel S.U.V.'s from Mercedes and Audi, and I made it to
Charlotte both times on about one tank of fuel. The Explorer took nearly two.
And while we're on the subject of reality, let's not overlook the sticker price. At almost $42,000, it strays
uncomfortably close to the $48,000 BMW X5. The Sport carries an $11,680 premium over the base front-drive
Explorer, a competent vehicle in its own right.
It may seem a bit much, but excess usually is.
MORE POWER, MORE MONEY: The Explorer Sport borrows its twin-turbo EcoBoost V-6 from the Taurus SHO.
(PHOTOGRAPH BY FORD MOTOR)
Document NYTF000020130331e93v00030

Lawsuit alleges older Fords susceptible to sudden acceleration
MONEY
Lawsuit alleges older Fords susceptible to sudden acceleration
Jayne O'Donnell
Jayne O'Donnell, @JayneODonnell, USA TODAY
601 words
29 March 2013
USAT
FINAL
B.6
English
A multistate lawsuit filed Thursday says 2002-10 Ford Motor vehicles have a "design defect" in the electronic
control of the gas pedals that makes them susceptible to sudden, unintended acceleration.
The lawsuit filed on behalf of Ford owners in 14 states is seeking class-action status and goes into great detail
about the alleged defect in the models named in the suit that don't have brake override technology. That
technology stops the car if both the brake and the gas pedal are activated at the same time. In 2010, Ford began
installing it, known as "brake over accelerator," in all vehicles it makes.
"For too long, Ford has put its own financial interests ahead of its consumers' safety," says Adam Levitt, one of
the lawyers leading the litigation. "We hope this lawsuit sheds light on this important situation and requires Ford to
correct its ways."
Attorneys for the plaintiffs are seeking compensatory damages for the lost value of the affected cars -- that is, the
difference between what was paid for the cars and the value of the defective vehicles. The lawsuit also asks Ford
to "fix the problem."
Lawyers involved in the case told USA TODAY most Ford owners probably don't realize their cars could take off
on their own.
The lawsuit was filed in the U.S. District Court for the southern district of West Virginia. It cites a 2011 report by
the Transportation Department's inspector general that showed Ford had the same number of deaths and injuries
from these electronic throttle controls as Toyota: 374 from 2003 through 2009. Ford had 22% of all complaints of
unintended acceleration during that period, more than any of the other major auto manufacturers, the report said.
A review of the National Highway Traffic Safety Administration's data shows complaints regarding sudden
acceleration in Ford vehicles (including Lincolns and Mercurys) jumped from 2005 to 2007, with injuries due to
sudden acceleration at their highest rates from 2004 to 2006. But a Ford statement Thursday said: "NHTSA has
investigated alleged unintended accelerations many times over many years and has concluded that driver error is
the predominant cause of these events. NHTSA's work is far more scientific and trustworthy than work done by
personal injury lawyers and their paid experts."
Toyota recalled nearly 8 million Toyota and Lexus vehicles in the U.S. during 2009 and 2010 due to problems
related to gas pedals that could stick and floor mats that could interfere with the gas pedal. The months of
publicity and congressional hearings helped prompt NHTSA to propose a rule requiring brake override.
However, NHTSA and the National Aeronautics and Space Administration concluded in a 2011 report that it could
not find evidence of Toyota electronic malfunctions.
"Ford has a long history of these cars taking off in various points," says Edgar "Hike" Heiskell, a West Virginia
lawyer involved in the litigation.
He points to German automakers' addition of brake override years ago.

Tom Baloga, a retired BMW vice president of engineering, says it wasn't sudden acceleration but the perception
of it that prompted German automakers to install brake override. "This voluntary initiative adapted to U.S.
conditions where technical circumstances and emotional reactions blur investigations."
Owners of 2002-10 Fords with electronic throttle control but no brake override are considered plaintiffs if vehicles
were purchased in West Virginia, Florida, Illinois, Maryland, Massachusetts, Michigan, Missouri, New York, North
Carolina, Oklahoma, Pennsylvania, South Carolina, Virginia or Wisconsin.
Contributing: Meghan Hoyer
Document USAT000020130329e93t00006

Corporate News: Auto Makers Try to Tackle Inaccuracies Measuring MPG
Corporate News: Auto Makers Try to Tackle Inaccuracies Measuring MPG

By Joseph B. White and Jeff Bennett
700 words
28 March 2013
J
B7
English
Auto makers are road testing new ways to promote their fuel efficiency, in part out of frustration with the
imprecision of federal mileage estimates.
Ford Motor Co. global marketing chief Jim Farley on Wednesday said the auto maker will pay up to $50,000 in
prize money for the best mobile or Internet applications that help drivers track their vehicle's fuel-economy and
encourage them to share fuel-savings tips.
The auto maker's move comes on the heels of a rash of complaints that some of its vehicles don't deliver the
mileage promised by the tests dictated by the federal government. A Department of Energy run website,
fueleconomy.gov, lets drivers submit real-world mileage, but contributions are voluntary.
Ford could benefit by gathering data about customer driving habits. It plans to begin accepting submissions next
month and select winners in late August. Guidelines and judging criteria aren't yet available.
Ford isn't alone in its frustration over the variation between real-world fuel efficiency, rival manufacturers' testing
and the Environmental Protection Agency estimates that companies are compelled to cite in their advertising.
General Motors Co. is considering television advertisements that spotlight its fuel efficiency technologies, such as
the opening and closing of under body shutters to control air drag on the vehicle.
"Showing how the technology works really resonates with people," GM interim head of marketing Alan Batey said
on the sidelines of the New York International Auto Show on Wednesday. "When you look at some segments,
especially pickup trucks, there are claims of leadership in five or six different areas. Consumers can't react to that
in a meaningful way."
Mr. Batey said experience with the Chevrolet Volt plug-in hybrid and web forums demonstrates how drivers
respond when the technology is discussed and then featured as an application within the car itself.
"We have people that like to claim bragging rights when they have reached a new fuel savings level," Mr. Batey
said.
Toyota Motor Corp. U.S. marketing chief Bob Carter said the industry needs to start policing itself. "If one
manufacturer makes a claim and the media comes out and says those claims aren't factual, that doesn't just
reflect on the one manufacturer. That dilutes the message from all manufacturers."
The accuracy of EPA mileage estimates, which are largely produced from tests done by auto makers themselves,
has been a concern among auto makers for years. The agency overhauled its testing procedures several years
ago in an effort to narrow the gap between the lab results and the mileage consumers were achieving in
real-world driving.
The issue got fresh life last year after South Korean auto makers Hyundai Motor Co. and Kia Motors Corp.
overstated the fuel economy on nearly a million late-model vehicles. The discrepancy was discovered by the
EPA. Some Hyundai rivals had questioned the accuracy of the company's fuel economy claims.
Hyundai and Kia issued owners special debit cards to reimburse them for the extra money they pay for fuel. The
auto makers blamed "procedural errors" at testing operations in Korea.

Mike O'Brien, head of product planning for Hyundai's U.S. arm, said hybrid and alternative fuel vehicles are
complicating the discussion around mileage ratings. "The way they perform, the technologies that are being used
are a little bit different from an internal combustion engine. That certainly has been an element of debate," Mr.
O'Brien said.
Separately, Consumer Reports magazine said C-Max and Fusion hybrids fell short of its fuel economy claims
using its own driving tests on the vehicles. The Fusion hybrid reached 39 miles a gallon in both highway and city
driving, while the C-Max topped out at a combined 37 mpg. Both were expected to achieve about 47 mpg,
according to estimates from Ford and the EPA.
Mr. Farley said Ford's internal data shows consumers were satisfied with the mpg claims of its brands.
---
Christina Rogers contributed to this article.
Document J000000020130328e93s0001x

3-D printers wave their magic wands ; Dream up a doodad, hit 'M' for make, and presto
MONEY
3-D printers wave their magic wands ; Dream up a doodad, hit 'M' for make, and presto
John Shinal
1,617 words
21 March 2013
USAT
FINAL
B.1
English
When Ford Motor shows off the latest version of its hybrid car at an Atlanta auto show this month, its drive train
and other key parts will be products of a new development process that's taken hold across Corporate America
and the world.
Rather than using custom machine tools to build early prototypes of new parts, Ford is now using 3-D printing
technology to design and test its engineers' latest ideas. The new method allows product developers to have a
prototype in their hands in as little as a week after they create a new design -- compared with a previous wait time
of three to four months.
"We're building more and more parts every day using this process," says Harold Sears, a technical expert in rapid
manufacturing at Ford's design facility in Dearborn, Mich.
Ford's new hybrid transmission was developed on a 3-D printer that costs about $300,000 and that can turn a pile
of aluminum powder into a working prototype in a day or two.
"For any engineer using (prototype) models to develop, this is the way to do it," says Sears. "Most large
companies are now doing things this way."
The process has done more than just save time and money, according to Sears and a half-dozen other engineers
USA TODAY spoke with. They say rapid prototyping using 3-D printing is producing more innovative,
higher-quality products -- from custom-fitted bicycle helmets and prosthetics to better-sounding ear buds and
loudspeakers.
"This has more than cut in half the time it takes to go from a crazy idea in someone's head to a part that's ready
for production," says Charles Sprinkle, a systems engineer for Harman America, a Stamford, Conn.-based maker
of loudspeakers.
Instead of waiting for tools and parts to come back from outside machine shops or injection-molding houses,
product developers on tight deadlines now get more hands-on time to test their models. 3- D printers let them test
and update more versions of their prototypes -- in some cases tripling the number of iterations of a new product
that can be refined before being mass-produced.
Leading makers of 3-D printers, such as Stratasys of Eden Prairie, Minn., have developed midrange desktop
models costing $30,000 to $50,000. As they look to address a wider market, upstarts such as MakerBot and Type
A have rolled out mass-market models priced at less than $2,500 -- well within the reach of consumers and small
businesses.
The proliferation of the technology is creating a growing industry based on 3-D printing, one that includes
everything from contract prototyping work to high-tech incubators teaching 3-D printing courses to individuals.
"As costs come down and speeds go up, the number of products is exploding," says Adam Ellsworth, CEO of San
Francisco-based ProtoTank, a start-up that provides prototyping and custom design services.
Just as Nike used 3-D printing to develop the cleats for its latest athletic shoe, small entrepreneurs are using
services such as ProtoTank to design everything from glow-in-the-dark lab coats to signs that need neither neon
gas nor electricity to glow.
Companies that target small business and consumer applications of 3-D printing are attracting backers who see
the technology as a future driver of economic growth.
This month, the New York City Investment Fund extended a loan to Shapeways, one of the leading companies
providing 3-D printing and prototyping services to other businesses. The New York-based company was spun out
of Dutch giant Royal Philips Electronics in 2007. The $1.2 million loan is to be used by Shapeways to build a new
facility in the Big Apple, says Maria Gotsch, president and CEO of the New York City Partnership Fund.
"There's a lot of design expertise here, a lot of architecture firms," Gotsch says. "We think they're going to be
early adopters of this technology" among small businesses. Gotsch believes that 3-D printing "is right on the
cusp" of transitioning from a niche technology, used mainly by large corporations and hobbyists, into a mass
market of consumers and small businesses.
"We see this as a growth area, and we want to attract and keep the economic activity and jobs it creates here in
New York," she says.
The maker economy
On the other side of the country, instructor Kyle Moore is teaching a 3-D printing class at the San Francisco
location of TechShop, a technology incubator with offices in 10 U.S. cities. It's early on a Wednesday afternoon,
and six of the eight workstations in the classroom are filled by people who each paid $60 for the two-hour class.
"Now, we hit 'M' for make," Moore tells the class, after prepping a software file that, if all goes well, will print out a
plastic nut and bolt precise enough to fit together snugly. As the students watch, a thin line of filament begins to
be squeezed out of an extruder and onto a raised platform in the middle of the machine.
The innovative products that will someday come from these types of low-cost machines will be limited only by the
imagination, according to Chris Anderson, the former editor of Wired magazine whose non-fiction book, Makers,
helped bring the growing 3-D printing economy to light.
Speaking to an audience of San Francisco's Commonwealth Club in October, Anderson said the "maker
revolution" spurred by 3-D prototyping will rival both the industrial revolution and the PC revolution in its impact on
society. "The introduction of a digital manufacturing model to the general public means the democratization of
technology," says Anderson, as individuals will soon be able to produce small numbers of products comparable to
those made by large corporations.
He envisions a future with everything from custom body parts to "instant vaccines made by a DNA printer."
Yet the advance of a new technology isn't without setbacks, something discovered by the students in Moore's 3-D
printing class. Soon after Moore started the print job that was supposed to become the nut and bolt, one student
noticed that the first layer of plastic was misaligned with layers that were extruded on top of it. Moore spent the
next 10 minutes trying to scrape and pry the now- worthless piece of plastic off the Replicator 2's platform.
Clearly, the technology is still a work in progress.
"3-D printers have come a long way, but they still only work about 70% of the time," says Jesse Harrington, a
former industrial designer who now works as a program manager and liaison to the 3-D maker community for
Autodesk, a maker of design software.
The technology also has its limits because the fused deposition modeling that 3-D printers use to create products
in layers results in a structural integrity too weak for them to be used in production parts. For example, while
some gun enthusiasts are creating custom ammo clips at home with 3-D printers, such magazines warp and fail
after discharging just five or six bullets.
"3-D printing isn't going to replace manufacturing of anything that's made with liquid metal poured into a mold, at
least not yet," Harrington says. "Once you get over 100 (in quantity), 3-D printing isn't of much use today." Still,
the technology is revolutionary, he says, because "you don't need to have any machine skills to prototype."
Meanwhile, large companies continue to use 3-D prototyping to push the boundaries of innovation. In Northridge,
Calif., engineers at Harman America's JBL unit used the process to develop a new type of loudspeaker
component that produces better, more reliable sound.

"We can use software to predict how a part will perform, but that only takes us so far," says Derrick Rodgers, a
JBL product engineer who's been prototyping with 3-D printing for about a decade. "Having a physical model to
measure the acoustic performance of a new component lets us do things we couldn't do before," he says.
Among the earliest adopters of 3-D printing was Jabil Circuit, a contract manufacturer that helps produce
electronic products for companies including Apple, Cisco Systems and IBM. Jabil has been using a 3-D printer for
about 15 years and now uses it for "almost anything we touch, from medical equipment to semiconductor
equipment," says Gregory Jantsch, a mechanical engineering manager at the company's headquarters in St.
Petersburg, Fla.
Most design-review meetings at Jabil revolve around prototypes produced on a 3-D printer that costs about
$45,000, Jantsch says. "For engineers and designers, there's no substitute for a part you can touch or hold in
your hands," he says.
Jabil makes everything from Hewlett-Packard laptops to BlackBerry smartphones, but Jantsch declined to say
whether the company was using 3-D printing to help develop a new so-called "smart" wristwatch rumored to be in
development at Apple and Samsung.
But asked whether such a product will be made using rapid 3-D prototyping, Jantsch was sure it would. "There's
no doubt in my mind," he says. "Anyone who doesn't develop this way will be left behind."
photo Jeff A. Kowalsky, for USA TODAY Ford technologist Kevin Sowles takes a 3-D part out of a mold in
Dearborn Heights, Mich., on March 12. Rapid prototyping using 3-D printing is producing more innovative,
higher-quality products.
Document USAT000020130321e93l00009

Detroit: Lean Into Car-Market Turn
Heard on the Street

Detroit: Lean Into Car-Market Turn
By Justin Lahart
549 words
19 March 2013
J
C10
English
It's not true that women are worse drivers than men. But women drivers could be hazardous for U.S. car
companies.
In the U.S., women have become the majority of drivers. Figures from the Federal Highway Administration show
that in 2011 -- the last year with data available -- 50.5% of licensed drivers were women, up from 39.6% in 1963.
That share should only grow in the years to come, reckons Michael Sivak of the University of Michigan's
Transportation Research Institute. The reasons for this are a drop in the number of young men actually getting
licenses and an increase in the share of older drivers. The latter matters because more women make it into old
age than men.
Meantime, the pay gap between men and women continues to narrow. The median female worker made 81 cents
for every dollar her male counterpart made last year, compared with 62 cents in 1979. That trend, too, will almost
certainly continue: Survey findings recently released by the Labor Department showed that among Americans
born in the early 1980s, 30% of women had received a bachelor's degree by the age of 25 compared with just
22% of men.
One conclusion arising from all this is that women are becoming a much more potent force in the car market. That
could pose a challenge for the auto industry in general and General Motors and Ford Motor in particular.
A study of 2012 new vehicle registrations conducted by automotive data company R.L. Polk shows that women
gravitated toward smaller, more fuel-efficient cars than men did. This is something that holds true even when the
analysis excludes pickup trucks, which men often buy for work-related reasons.
Women also tend to buy less expensive cars. According to research firm RDA Group, the average new car
bought by a woman last year cost 12% less than the average new car bought by a man. So car makers may not
be able to squeeze as much profit out of each vehicle they sell as in the past.
Of course, if the wage gap continues to narrow, women may start shelling out more for cars. Indeed, for G.M. and
Ford, the bigger worry isn't that the cars women are interested in tend to have slimmer profit margins but that
women aren't all that interested in the cars they happen to make.
Among the top 10 cars women purchased in 2012, only two were American brands: the Ford Escape, which
ranked seventh, and the Chevrolet Equinox, which came in at number nine.
Ford and G.M. needn't expressly design cars for women -- something the auto industry has already learned is a
bad idea -- in order to capture a greater share of sales.
Rather, Detroit needs to establish a reputation for quality with cars such as the Ford Fusion and Chevrolet Malibu
so the domestic car makers can compete successfully with the likes of the Toyota Camry and Honda Accord.
The longer it takes for them to do that, the more sales they stand to lose.

Document J000000020130319e93j0001p

A Chase Car to Lure Private Eyes Out of Retirement
BEHIND THE WHEEL | 2013 CHRYSLER 300 SRT8

Automobiles; SECTAU
A Chase Car to Lure Private Eyes Out of Retirement
By LAWRENCE ULRICH
1,154 words
17 March 2013
The New York Times
NYTF
1
English
When I think of people who'd fall hard for the Chrysler 300 SRT8, names come to mind: Kojak, Mannix, Rockford,
Starsky and Hutch.
Trivia lovers will note that the private detective Jim Rockford was a Firebird man, and that Starsky and Hutch
favored a white-striped Ford Torino. And it's the 300's sister car, the Dodge Charger, that's been recruited for
actual police work.
But on the gritty streets of Brooklyn and New Jersey, the broad-shouldered Chrysler always seemed a step away
-- specifically, a step on the gas pedal -- from a tire-burning cop-show chase. Or, alternately, a video game
appealing to characters on either side of the law.
And there is nothing virtual about Chrysler's new Performance Pages, which engages drivers in real-life
competition. Displayed on the 8.4-inch UConnect infotainment screen in the center of the dash, this computer
animates and records this Chrysler's feats of acceleration, braking and handling. My best score was a fleet
4.8-second run from 0 to 60 miles per hour, accomplished without the aid of the electronic launch control, which is
standard on this 2013 model, though I didn't engage it.
The 300's name can be traced to the C-300 of 1955, the first American sedan whose V-8 engine produced 300
horsepower. The father of that car was Virgil Exner, the industrial designer and lover of tailfins. But the modern
300 can claim two daddies: the car is perhaps the most successful melding to emerge from the shortlived union of
Chrysler and Mercedes-Benz, and it is still genetically related to the Mercedes E-Class. The 300's combination of
American street style and German breeding made it a cultural and showroom hit.
Now, a reworked line of 300s help to carry the torch for the post-bankruptcy Chrysler controlled by Fiat. The 300
is one of several models whose cabins suggest that Chrysler -- after decades of cheap-plastic eyesores -- is
finally turning the corner with competitive, attractive interiors. A touch of Italy never hurts: the car I tested was
outfitted with $2,500 worth of Poltrona Frau leather on its upper doors, instrument panel and center console.
Even without the fancy Italian hides, the handsome cabin breathes new life into a big sedan that feels more
rewarding than pedestrian front-drive cars like the Toyota Avalon and Ford Taurus. It helps that the 300, like the
Mercedes, was designed as a rear-drive car despite an all-wheel-drive option (though not for the SRT8).
For most 300 buyers, the combination of a new 8-speed automatic and a Pentastar V-6, with 292 horses and a
highway economy rating of 31 m.p.g., is the smart app. A 5.7-liter Hemi V-8 raises the horsepower to 363 -- and
surely that's enough, right?
But no, say the muscle heads at Chrysler. The engineers of the SRT division, which produces the Viper sports car
and high-performance versions of the Jeep Grand Cherokee, Dodge Charger and Dodge Challenger -- have
created a small batch of SRT8s. The tuner edition of the 300 adds a raging bull of a Hemi, with 6.4 liters, 470
horsepower and 470 pound-feet of torque, coupled to a 5-speed automatic.
The SRT's interior features real carbon-fiber trim and a heated, chrome-spoke, flat-bottom steering wheel with
paddle shifters. For $1,995 you can add a 900-watt 19-speaker Harman Kardon audio system. Also available is a
two-tone interior with red leather seats, faux-suede inserts and heated cushions for the front and rear.
The Performance Pages readouts add a range of analog-style engine and transmission gauges. One vivid screen
animates real-time horsepower and torque output. Another highlights the g-forces affecting the car -- in
acceleration, braking and cornering. I kept finding excuses to goose the Chrysler, just to watch the horsepower
gauge explode from roughly three horsepower -- the Hemi's output at idle -- to 400 and beyond. Just remember to
keep one eye on the blurry road ahead; the car runs a quarter-mile in roughly 12.7 seconds. Top speed is said to
be 175 m.p.h.
The SRT's reworked body looks ready for undercover duty. The car is half an inch lower than a standard 300, with
dual four-inch exhaust outlets and 20-inch wheels. The SRT's approach to performance is as subtle as a
blackjack to the skull.
But while the Hemi provides the blunt force and basso soundtrack of a big-block Motown V-8 -- with equally
oversized, track-worthy Brembo brakes -- the Chrysler tempers that force to become a surprisingly comfortable,
compliant daily driver. The Hemi can shut down 4 cylinders to save fuel, though it remains thirsty, with an E.P.A.
mileage rating of 14/23 m.p.g., drawing a $1,000 gas-guzzler tax.
The adaptive suspension now features three selectable modes. The stiffest Track setting commands the
transmission to hold gears at high revs while the driver manually controls the shift paddles or console stick. Yet
that 5-speed transmission remains the weak link, especially in light of the 8 speeds in other verisons of the 300.
The SRT8's starting price of $49,990 can seem iffy at first, and more so after options. (My test car checked in at
$57,750.) The closest comparison for the Chrysler may be Cadillac's CTS-V, a 556-horsepower beast available
as a sedan, coupe or wagon. But even that formidable Caddy costs about $15,000 more than the 300.
Still, smaller German supersedans like the Mercedes E63 AMG and BMW M5 cost $100,000 and more.
With its accurate but relatively light steering, the Chrysler isn't as precise, agile or luxurious as the Mercedes or
BMW. But on the mean streets, it gets the job done in remarkably similar fashion. The Chrysler delivers 90
percent of the German cars' performance for barely half their price. And I'll swear this on a stack of Gutenbergs:
the Chrysler is more fun and more visceral than BMW's flawed new M5, though not as sensational as the
Mercedes.
And if valet attendants don't respond as quickly to the Chrysler, you can always try flashing a badge.
HOT WHEEL: The SRT8, a performance- tuned edition of the Chrysler 300, can run with German supersedans
like the BMW M5, at roughly half the price. (AU1); COPS AND ROBBERS: With appeal to video gamers on either
side of the law, the SRT8 has a 470-horsepower Hemi V-8, dual four-inch exhaust outlets and 20-inch wheels. Its
body rides lower than other Chrysler 300s. (PHOTOGRAPHS BY CHRYSLER GROUP) (AU5)
Document NYTF000020130317e93h0003v

Corporate News: Ford Boss's 2012 Pay: $21 Million
Corporate News: Ford Boss's 2012 Pay: $21 Million

By Mike Ramsey
453 words
16 March 2013
J
B3
English
Ford Motor Co. gave Alan Mulally $21 million in compensation last year, down from the $29.5 million the chief
executive received in 2011, as the auto maker fell short of some of its performance targets.
Mr. Mulally, CEO since September 2006, has been among the best-compensated automotive executives ever as
he has steered Ford from near death to solid profitability. Over the past three years, he has earned about $75
million, mostly in stock. In the past year, Ford reestablished its investment-grade rating and restored its dividend.
But Ford had market-share setbacks in the U.S. and Europe in 2012, restraining pay for top executives at the
company. Still, Mr. Mulally made roughly twice as much as Dan Akerson, the CEO of General Motors Co., which
is limited in how much it can pay its top executives because of the U.S. government's stake in the company.
GM hasn't released its proxy statement, which would include an accounting of executive pay, but documents
released by the U.S. Treasury listed Mr. Akerson's compensation for 2012 at $11.1 million. GM disputed the
figure, saying his pay remained at $9 million. Sergio Marchionne, the chief executive of Chrysler Group LLC,
earned $1.2 million last year. Mr. Marchionne also is CEO of Fiat SpA, which has a majority interest in Chrysler.
Mr. Mulally received $2 million in salary and a $3.95 million cash bonus, with stock awards making up the
remainder of his 2012 compensation. The 67-year-old executive has more than 5.9 million Ford shares, as well as
1.14 million shares of restricted stock that haven't vested and 21 million option shares.
Ford achieved 75% of its performance targets last year. Its U.S. and European market share declined and the
company also didn't achieve its quality-improvement and cash-flow targets.
For 2012, Chairman Bill Ford Jr. received $14.8 million in compensation; Chief Operating Officer Mark Fields,
$8.85 million and Chief Financial Officer Bob Shanks, $5.18 million.
Separately, Ford said Friday it will restart production at its plant in Genk, Belgium, on Monday after union workers
approved a separation agreement that pays up to 2 1/2 years' of salary in a lump sum depending on length of
service.
The plant, which Ford is planning to close in 2014, has barely operated since Oct. 25. Workers have prevented
the few thousand Mondeo sedans and S-Max and Galaxy minivans on the site from being shipped to dealers.
Document J000000020130316e93g00021

Employers Blast Fees From New Health Law
Employers Blast Fees From New Health Law

By Janet Adamy
1,110 words
15 March 2013
J
A1
English
Employers are bracing for a little-noticed fee in the federal health-care law that will charge them $63 for each
person they insure next year, one of the clearest cost increases companies face when the law takes full effect.
Companies and other plan providers will together pay $25 billion over three years to create a fund for insurance
companies to offset the cost of covering people with high medical bills.
The fees will hit most large U.S. employers, and several have been lobbying to change the program, contending
the levy is unfair because it subsidizes individually purchased plans that won't cover their workers. Boeing Co.
and a union health plan covering retirees of General Motors, Ford Motor Co. and Chrysler, among other groups,
have asked federal regulators to exclude or shield their insurance recipients from the fee.
Insurance companies, which helped put the fee in the law, say the fee is essential to prevent rates from
skyrocketing when insurers get an influx of unhealthy customers next year. The fee is part of a new insurance
landscape created by the health law that will forbid insurers from denying coverage to people with pre-existing
conditions.
The $63 fee will apply to plans covering millions of Americans in 2014. It applies to employers that assume the
risk for workers' medical bills, and many private plans sold by insurers. The fee will be smaller for 2015 and 2016,
though regulators haven't set those amounts.
Few noticed the fee when the 2010 Affordable Care Act passed. Employers have spent recent months trying to
peel it back, but final regulations published Monday in the Federal Register left it largely intact.
"It's caught most employers, if not all employers, by surprise," said Steve Wojcik, vice president of public policy at
the National Business Group on Health in Washington, which represents large employers. "They're very upset
about it."
The fee comes on top of other costs employers expect to face. Proponents of the law say it eventually will lower
employers' health costs by expanding insurance coverage to 30 million Americans, meaning employers won't
subsidize their unpaid medical bills.
Administrators for employee health plans have warned federal regulators they could pare insurance benefits to
absorb the fee. Some benefits experts expect employers will at least partially pass on the $63 to workers.
Boeing estimates the fee will apply to about 405,000 workers and dependents it insures, costing the
Chicago-based plane maker an estimated $25 million in 2014. The company spends $2.5 billion annually on
health and insurance-related benefits.
Doug Kight, a Boeing vice president of strategy, compensation and benefits, told Health and Human Services
Secretary Kathleen Sebelius in a December letter the aircraft maker was "concerned about the significant cost
impact" of the fee. Among other things, he effectively asked her to reduce the levy to account for the fact that
Boeing's workers aren't part of the insurance system that can tap the reimbursement fund.
The UAW Retiree Medical Benefits Trust, which covers 806,000 retirees of General Motors, Ford, Chrysler and
their dependents, asked HHS to exempt all its beneficiaries from the levy. It argued the trust, which is
independent from the auto makers, shouldn't face the fee because its plans operate under terms set in federal
district and bankruptcy courts in 2009.

The top lobbying groups for large employers, including the U.S. Chamber of Commerce and the Business
Roundtable, also voiced concerns about the fee and asked regulators to delay its collection.
In the regulations published Monday, HHS declined to whittle down the levy for firms such as Boeing, citing the
law's requirements. It said the fee wouldn't apply to the plans of retirees whose primary coverage is Medicare,
which would exclude many retired autoworkers, but it declined to categorically exempt workers in court-structured
benefits plans.
A Boeing spokesman said the final regulations don't appear to address the major issues it raised with regulators.
A spokeswoman for the UAW trust declined to comment.
Federal regulators say they have heeded employers' complaints about the fee and tweaked details of the
program. They opted to collect the levy nationally instead of through each state, moved the collection date to the
end of next year and calculated the fee on a per capita basis instead of as a percentage of premiums.
"We've tried to really work with the employers and issuers in trying to make the application of this program as
least burdensome as possible," said Michael Hash, director of the HHS Office of Health Reform.
In 2014, insurers will be able to tap part of the $25 billion to offset medical costs from high-risk individual-market
consumers that total between $60,000 and $250,000 a year. Employers and other insurance issuers will pay $63
in 2014 for every worker, spouse, child and certain retirees they cover.
Of the fees collected, $20 billion will go toward paying high medical claims. HHS says the remaining $5 billion will
be used to retroactively offset an earlier program that reimbursed employers insuring early retirees through 2011.
Under that program, Boeing received $50 million and the UAW trust received $387 million, according to a federal
summary of the payouts.
A Boeing spokesman said the retiree program "was not advertised as a program prefunded by the government to
be paid back at a later time," and that the law's net financial impact on Boeing is negative. The UAW trust
declined to comment.
HHS says the high-risk program will lower premiums for people who buy plans through the individual insurance
market by between 10% and 15%. For insurance plans overall, the fee is expected to raise premiums next year
by about 1%, and less in the subsequent two years of the program.
Insurance companies defend the fees, saying they will indirectly benefit employers. Companies subsidize the cost
of caring for the uninsured by paying higher medical and insurance prices for workers. Moving high-risk
consumers into insurance policies will minimize that problem, they say.
These uninsured "had been the individuals going to the emergency room," said Karen Ignagni, president of
America's Health Insurance Plans, an insurer trade group in Washington. "The employers definitely were picking
that up."
Other health plans that tried and failed to win a federal exemption from the fee include so-called multiemployer
insurance plans, jointly run by unions and employers. About 20 million Americans are covered by such plans.

Document J000000020130315e93f00039

Shelby Focus ST hopes to earn its stripes ; Company goes mainstream with first performance touches on a small car in nearly 30 years
MONEY
Shelby Focus ST hopes to earn its stripes ; Company goes mainstream with first performance touches on
a small car in nearly 30 years
Chris Woodyard
Chris Woodyard, @ChrisWoodyard, USA TODAY
711 words
12 March 2013
USAT
First
B.7
English
Tooling around the city, John Luft got just the kind of instant feedback he had hoped to garner for his company's
latest creation, a hopped-up Ford compact that bears the name of an automotive legend.
In fact, Luft, CEO of Shelby American, relished the most common reaction: "People stopping and staring" at the
white Shelby Focus ST with blue rally stripes that he was showing off.
Shelby American, a Las Vegas-based car-customizing outfit, has a lot riding on the hot little car. The Shelby
Focus ST marks the first small-car foray since the 1980s. It also is the company's first big endeavor since the
death of founder Carroll Shelby last year at 89.
As with the Mustangs that it modifies, Shelby American's plan for the Focus ST is strictly aftermarket. Owners buy
the new performance version of the Ford Focus, the ST, which has a base price of $23,700 plus shipping. Then it
gets the Shelby conversion for an added starting price of $14,995.
The Shelby crew upgrades the suspension, brakes, wheels and tires. Besides giving the car a throaty roar,
exhaust modifications and special tuning boost horsepower to 272, up about 20. The car is lowered by an inch,
giving it a sportier, more menacing look and a stiffer ride.
Inside, the Shelby name is stitched on front seats. A special plate with Shelby's signature and a special serial
number reside next to the short-throw stick shifter.
The version that Luft was showing off, the very first Shelby Focus ST, had its founder's old racing number, 98,
emblazoned on the doors.
Luft says the car's appeal as a Shelby goes beyond its performance credibility. He says existing Shelby owners,
those who have its Mustangs or maybe even a Cobra in the garage, are looking for something more practical to
share their passion with the next generation. "They want a daily driver," he says. "Some are buying them for their
kids."
Plus, Shelby Focus ST has some heritage on its side. It is the first batch of small Shelbys since 1986, when the
flamboyant Texan started modifying the otherwise forgettable Dodge Omni to create what he called the GLH. In
predictably unvarnished Shelby fashion, GLH stood for Goes Like Hell.
Will the new Shelby Focus ST win over enthusiasts? "It could be phenomenal," says Ed Loh, editor of Motor
Trend. But Shelby's extra tuning runs the risk of ruining an otherwise well-balanced vehicle, he adds.
Plus, he says, it is yet to be seen whether Shelby can maintain its cachet after the death of its founder. "Shelby's
biggest asset to the company was that he was a showman and a larger-than-life character," Loh says. As such,
Shelby the company is more poorly positioned than some others might be to carry on without its living legend.
Luft disagrees. He says the company should do just fine. It still is, and always will be, infused with the infectious
Shelby spirit. Shelby, one of the longest-surviving heart-transplant patients, had prepared them for the day when
he would be gone. "He kept saying, 'It's about the cars and not about me,'" Luft says.

The Shelby Focus ST hits at the right time, adds the performance manager of the nation's biggest-selling Ford
dealership. "Small performance cars are making a big impact," adds Ted Mengiste of Galpin Auto Sports, the
performance shop at Galpin Ford in Los Angeles.
So far, the market for collectible Shelbys is holding up just fine at auto auctions, says McKeel Hagerty, CEO of
Hagerty Insurance Agency and an oft-quoted expert on collectible cars.
As for the Shelby Focus ST, Hagerty says it stands a reasonable chance of joining other Shelbys as performance
car winners.
photo Maxine Park, USA TODAY The Shelby Focus ST is the performance car customizer's first small-car
creation since the mid- 1980s. The car carries Shelby's trademark striping and is an inch lower to the ground than
standard.
Document USAT000020130312e93c00009

Big Data (A Special Report) --- Drive Into the Future: Your car knows a lot about you; And it's talking
Big Data (A Special Report) --- Drive Into the Future: Your car knows a lot about you; And it's talking
By Ian Sherr and Mike Ramsey
890 words
11 March 2013
J
R5
English
Ford Motor Co. wants to read car buyers' minds.
A fantasy? Maybe. But by mashing together large databases and analytical algorithms, the Dearborn,
Mich.-based auto maker may have achieved the next best thing.
About three years ago, Ford began offering a system to dealerships that reads the dealer's inventory, checks
national and local supplies of vehicles, interprets buying trends and makes recommendations about what vehicles
the dealer should stock -- for example, three Ford Fusions with blue paint and specific types of engines.
The result has been significant. Ford vehicles are sitting on lots for fewer weeks, and the prices consumers are
paying are rising. The increase in "net pricing," or the price a consumer pays minus a subsidy from the
manufacturer, has been a driving force behind Ford's big surge in profitability.
"Making sure the inventory matches what the customer is looking for is really critical," says John Ginder, manager
of system analytics and environmental sciences in Ford's research and advanced engineering division. "The
dealer makes a major investment every time he or she orders a vehicle -- there is a long lead time in getting a
vehicle, and if the vehicle is ordered in a fashion not popular with customers, it can sit on the lot for months."
Car companies have a wealth of data that they are only just beginning to tap to serve customers and reduce
costs. Mr. Ginder's group, for instance, has been combing through consumer forums on the Internet and
social-media services such as Twitter to spot trends that could help guide product development and problems that
might lead to potential warranty issues. The team also mines financial databases to assess the health of key
suppliers, and analyzes internal human-resources databases in an effort to identify and head off labor issues,
such as engineering resources being stretched too thin.
Meanwhile, as more cars are outfitted with always-on Internet connections, car companies will be able to monitor
the performance of vehicles on the road and use the data they collect to improve the quality, safety and fuel
economy of vehicles and avoid engineering mistakes that could over time erupt into a recall.
"If you're driving around and you have a problem, and they see a bunch of other people are having the same
problem, the car company can send you a message and inform you to get the part changed," says Thilo
Koslowski, an analyst at Gartner Inc.
"Being able to minimize a recall can be real money for manufacturers," he says.
Improving safety, however, isn't the only way car companies can use that data. Mr. Koslowski estimates that by
2016, up to a third of all interactions between car companies and their customers will happen in the vehicle. Car
companies, for example, could collect and analyze data about how customers use leased vehicles, and based on
that information suggest other cars a driver might like around the time his or her lease is expiring, he says.
"They can notice all the vehicle seat belts are occupied and they can say, hey, maybe you want a family vehicle,"
Mr. Koslowski says.
In the coming years, auto makers like Ford, Audi AG and others see even more potential in big data. They
envision taking information from customers' typical driving patterns, schedules and movements on the road to
recommend routes the drivers might feel more comfortable with, either because they prefer city streets to
freeways or don't respond well to bumper-to-bumper traffic.

Ricky Hudi, head of electrics and electronics development at Audi, says connecting such pieces of information
together "opens up many new opportunities for making driving safer, more relaxed and more economical."
Networking cars together and gleaning information from their various sensors, for example, could be used to help
alert other drivers of icy roads or traffic pileups, or simply help time traffic lights for uninterrupted cruising, he
says.
Of course, all of this data collection could present privacy dilemmas for auto makers, and it is unclear how they
will resolve them.
Young people are most likely to accept these new systems at the outset, says Nash Parker, head of
Alcatel-Lucent SA's emerging-technology group, which creates prototype cars with auto manufacturers that have
advanced wireless communications capabilities.
"As you get younger, people are more willing to give up privacy for convenience or level of security," he says. But
he cautions that regulators could step in and create rules that could slow the rollout of some of these new
services.
Meanwhile, companies such as Ford are already finding valuable information in their growing mountains of data.
And for dealers like Beau Smith, the owner of Sill-TerHar Motors in Broomfield, Colo., that means better profit and
sales, thanks to Ford's efforts. "Our turn rate was the best it has ever been," he says.
---
Mr. Sherr is a Wall Street Journal reporter based in San Francisco. Email him at ian.sherr@wsj.com. Mr. Ramsey
is a reporter in Southfield, Mich. Email him at michael.ramsey@wsj.com.
Document J000000020130311e93b00003

Detroit Metal Largely Absent At Swiss Show
Automobiles; SECTAU
Detroit Metal Largely Absent At Swiss Show
By JERRY GARRETT
381 words
10 March 2013
The New York Times
NYTF
2
English
GENEVA -- The evolution of the American automakers in Europe, and their presence at the motor show here, is a
study in contrasts. To Chrysler, Ford and General Motors, Europe no longer presents a great opportunity to sell
American cars in foreign markets. Not so long ago, those attending the Geneva show could see, touch and kick
the tires of a much wider array of American iron than they can today.
Ford introduced small internationally designed people-movers here that are unlikely to be sold in the United
States. The Chrysler and Dodge brands are absent since being absorbed into the Fiat empire. And G.M. is
displaying fewer vehicles on the international stage.
Chevrolet broke ranks to introduce the Corvette Stingray convertible to an international audience. But it was
essentially a sneak preview of the droptop, which will make a splashier debut in front of its true target audience
this month at the New York auto show.
Cadillac also showed the ATS sedan along with its ELR plug-in hybrid.
Ford used Geneva to promote its ''One Ford'' global strategy, but it introduced a couple of vehicles that defy the
very idea of making single versions of Ford products that can be sold anywhere in the world.
The Ford EcoSport, a small Fiesta-size utility, is designed for sale in Europe, South America and India, but not in
the United States. Likewise, the European-focused Tourneo van family is the latest wave of Ford's series of
''product-led transformations.''
Few American Fords were on display. And an initiative announced in 2008 to introduce the Lincoln brand in
Europe seems to have fizzled completely.
Chrysler's main presence was at the Jeep display, where the latest Grand Cherokee made its European debut.
Unlike the smattering of other American cars shown here this year (and in most recent years) the Grand
Cherokee is expected to sell in strong numbers in Europe, as it does in many other overseas markets.
Chrysler-brand vehicles have been reincarnated at the Lancia display, where the 200 and 300 models wear
Flavia and Thema badges. Likewise, Lancia markets the Dodge Grand Caravan minivan as its Voyager. The
Dodge Journey wagon wears a Fiat Freemont badge.
Document NYTF000020130310e93a0001t

Toyota's Bottom Feeder Finally Makes Some Waves
BEHIND THE WHEEL | TOYOTA YARIS

Automobiles; SECTAU
Toyota's Bottom Feeder Finally Makes Some Waves
By LAWRENCE ULRICH
1,213 words
10 March 2013
The New York Times
NYTF
1
English
Considering Toyota's expertise in democratic, affordable transportation -- Corolla, Camry, Prius -- you'd think it
would rule the realm of entry-price cars.
Instead, with global-style subcompacts finally leaving their petite tire prints on American soil, the Honda Fit has
established itself as the roomy, sporty benchmark. Chevrolet, of all brands, has a high-mileage hit with the peppy
Sonic. The smart Hyundai Accent and Euro-sleek Ford Fiesta are firmly in the mix.
Toyota, for its part, had been laying weirdly shaped eggs like the Echo and its even paler echo, the depressingly
chintzy Yaris. But with a surprisingly sharp-handling Yaris, which was redesigned for 2012, most of Toyota's
subcompact sins are forgiven.
Again, that's ''most'' of its sins: with just 106 horsepower and 103 pound-feet of torque, Toyota's hatchback is
among the slowpokes of its class. Strapped to either two- or four-door models, the carry-over 1.5-liter 4-cylinder
buzzes its way from 0 to 60 miles per hour in about nine seconds. Compared with, say, the 140-horsepower
Sonic Turbo, you can hear and feel the Toyota working hard to overtake, or just climb to highway speeds.
The other remaining weirdness is a barstool-high seating position -- think of the Fiat 500 -- that's exacerbated by
the lack of a telescoping steering wheel. I sit closer to the wheel than many drivers, but even I had to slide
uncomfortably close to get the arms-to-wheel relationship right.
But the little Toyota gets nearly everything else right. The Yaris is affordable. The scrunched proportions remain
odd from some angles, despite a two-inch stretch of the wheelbase and four inches in overall length. Yet like
many of the current crop of subcompact hatchbacks, the Yaris is cheek-pinching cute. (The former Yaris sedan,
that vacation buzz kill at the nation's rental counters, is history).
The Toyota remains the smallest car in its class, a significant eight inches shorter than the Honda. (It's only about
seven inches longer than a Mini Cooper.) Despite that, the remade Toyota carves out a surprisingly decent back
seat for two adults. A formerly cramped cargo area is nearly six inches longer and 2.1 inches wider, increasing
overall capacity by a remarkable 68 percent for the four-door, Toyota says.
True to its name, the larger Honda Fit remains the clown car of this segment, packing in bigger people and more
gear than seems possible.
The Yaris's bite-size body lets the car glide into Manhattan curbside spots with enough room left over for a Smart
car. At the curb, the Lagoon Blue paint was striking enough to draw unsolicited compliments, a turquoise-y shade
that really fit the car's personality.
That personality is spartan but stylish. The cabin's well-bolstered, pattern-cloth seats; leather-wrapped three-point
steering wheel; simple but useful audio unit; and rice paper-inspired material on the doors and dashboard left a
low-key impression of quality.
The windshield fluid sprays ahead of the single wiper from the arm itself, just as in some luxury cars, rather than
blasting hither and yon from the base of the glass.

The Yaris doesn't officially reach the 40 m.p.g. bragging zone, with a rating of 30 m.p.g. in the city and 38 on the
highway with its 5-speed manual transmission. An automatic with a mere four speeds is an $800 option, but it
lowers the highway rating by 3 m.p.g. Given that Chevy, Ford and Hyundai offer thriftier 6-speed automatics,
Toyota had better get with the program.
But as I tell small-car shoppers who ask my opinion: don't get distracted by the industry's rampant oneupmanship
on fuel economy. The 40 m.p.g. claims of several small cars are proving dubious. Most notoriously, several of the
Hyundai and Kia small fry have been caught with their knee pants down -- the companies agreed to reimburse
customers for overstating mileage claims, in the case of the Hyundai Accent and Kia Rio, by 3 to 4 m.p.g.
Consumers should also realize the penny-wise, pound-foolish nature of focusing on slight m.p.g. gains among
cars that already enjoy low fuel costs. The Chevy Spark, a microscopic 84-horsepower city car, squeezes out a
combined city-highway rating of 34 m.p.g., which is 1 m.p.g. better than the Yaris or the most frugal versions of
the Sonic and Fiesta. Congratulations: You just saved $1 a week, based on the Environmental Protection
Agency's calculation of an annual fuel cost of $1,500 versus $1,550 for the other cars. Buy yourself a cup of
coffee with that buck, though at a cheaper place than Starbucks.
The Yaris, the lightest car in its league at less than 2,400 pounds, did show excellent mileage where it counts. I
managed 34 m.p.g. over all through the course of a week and 40 m.p.g. at highway cruising speed, beating the
E.P.A. estimate.
I've saved the best for last. I'll swear on a stack of Toyota owner's manuals that the Yaris is actually fun to drive.
As such, it's the antithesis of the comatose conveyance pod we've come to expect from Toyota.
Despite its underdog power, the endearing Yaris is a grippy little monster on curving roads. The steering is lively
and connected, and the chassis is composed, especially for the SE model, which has quicker steering and
attractive 16-inch alloy wheels, a rear spoiler, fog lamps, other body additions and secure-feeling disc brakes at
all four wheels.
The Yaris is also competitively priced, at $15,165 for the basic L two-door. My four-door SE started at $17,275
and, with options, totaled $17,504.
While the Yaris doesn't offer the optional navigation system of some higher-price subcompacts, it is well stocked.
All models get nine air bags, including side curtains and a driver's knee bag; stability and traction controls with
antilock brakes and brake assist; and Bluetooth and USB connections. Satellite radio is available.
The ride can get a bit choppy on chewed-up surfaces, a function of the short wheelbase and a torsion-beam rear
suspension that's par for budget-price cars.
But slap a set of stickier performance tires on this Toyota, and it would keep up with the average Volkswagen GTI
on winding back roads, where cars like the GTI can't take advantage of their superior acceleration.
Toyota is rightly known for popularizing the hybrid. A redesigned 2014 Corolla is on the way, aiming to regain an
edge against an onslaught of compact competitors.
But with this improved Yaris, Toyota seems to recognize that an ultra-affordable car can play a small but
important supporting role. Buyers should expect nothing less from a company that helped revolutionize
mainstream cars in America.
FUN SIZE: The Yaris now comes as a two- or four-door hatchback, starting at $15,165. (AU1); (PHOTOGRAPHS
BY TOYOTA MOTOR SALES) (AU5)
Document NYTF000020130314e93a0006n

Ford Recalling Minivans For Corrosion Problem
WHEELS
Automobiles; SECTAU
Ford Recalling Minivans For Corrosion Problem
By CHRISTOPHER JENSEN
483 words
10 March 2013
The New York Times
NYTF
3
English
4:44 p.m., March 7 | Updated Ford is recalling about 196,500 of its 2004-7 Ford Freestar and Mercury Monterey
minivans to fix a corrosion problem that prevents the fold-down third-row seats from locking safely into place, Kelli
Felker, a spokeswoman for the automaker, said today.
In a telephone interview, Ms. Felker said an additional 33,500 vehicles were being recalled outside the United
States, almost all of them in Canada.
However, Ford is recalling only vehicles sold or registered in 20 salt-belt states and the District of Columbia.
They are Connecticut, Delaware, Illinois, Indiana, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota,
Missouri, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island, Vermont, West Virginia
and Wisconsin.
That's called a regional recall, and some consumer advocates, like the Center for Auto Safety, have long
complained that such recalls serve to save automakers money and might -- in a mobile society -- fail to repair
some vehicles. Automakers have defended them as practical and safe.
In a March 4 report to the National Highway Traffic Safety Administration the automaker said it believes the
corrosion ''does not present an unreasonable risk of accident or injury.'' But, the automaker said, it was agreeing
to a recall ''to avoid a protracted dispute with the agency.''
Owners outside the salt-belt states who have a problem should contact their dealers for help, Ms. Felker said.
For owners whose minivans have been recalled, dealers will relocate the mounting bracket and repair and
reinforce the area with the corrosion problem, Ms. Felker said, adding that Ford was convinced that the vehicles
would still be safe in a crash.
Ford is not aware of any accidents or injuries related to the problem, she said.
The National Highway Traffic Safety Administration began investigating the problem in December 2011.
Last April it upgraded the inquiry to an engineering analysis, noting that it appeared that a third-row fold-down
seat ''can experience severe corrosion and structural degradation at the seat anchor mechanism mounted to the
rear wheel wells.''
One consumer who was delighted to learn of the promised repair is Julie Miller of Hopewell Junction, N.Y., who
owns a 2004 Freestar. In a recent article in the Automobiles section on how the safety agency often falls behind
in investigations, Ms. Miller wondered how long the investigation of the Freestar would take.
The recall means that the engineering analysis of the Freestar and Monterey will be concluded within 12 months,
meeting the agency's self-imposed goal.
On Wednesday, after being notified by a dealer of the recall, Ms. Miller said in an e-mail that she was ''doing a
happy dance.''

SEATS: 2004 Ford Freestar Limited. (PHOTOGRAPH BY FORD MOTORS)

Document NYTF000020130314e93a0006j

Ford Foundation Head Steps Down
NATIONAL BRIEFING | PHILANTHROPY

National Desk; SECTA
Ford Foundation Head Steps Down
By JOHN SCHWARTZ
78 words
6 March 2013
The New York Times
NYTF
16
English
The president of the Ford Foundation, Luis A. Ubiñas, will leave in September after six years at the nation's
second-largest philanthropic organization. Mr. Ubiñas engineered an overhaul intended to streamline Ford's
operations and led Ford through the worst of the recession. ''One of the hardest things for a leader is to know
when to step down,'' he wrote to the staff.
Document NYTF000020130306e9360003h

Corporate News: Car Sales Rise but at a Slower Pace
Corporate News: Car Sales Rise but at a Slower Pace

By Mike Ramsey and Jeff Bennett
629 words
4 March 2013
J
B3
English
Sales of new vehicles in the U.S. continued to rise in February, albeit at a slower pace than a year earlier, as the
prospect of job cuts and tax increases amid budget wrangling in Washington appeared to damp car buying at
month's end.
U.S. auto sales rose 3.7% to 1.2 million. The rate equates to a seasonally adjusted 15.38 million vehicles sold for
the full year, according to Autodata Corp.
Auto sales have been one of the most consistently positive economic indicators over the past three years, rising
steadily from a historic bottoming in 2009, when sales fell six million units below the trend of the previous decade.
Buyers have been steadily returning to the market, many pushed into a purchase by the age of their vehicles,
which has reached an average of 11 years, according to Polk, a research firm. This pent-up demand has allowed
auto sales to avoid big ups and downs in purchases despite rumblings from other parts of the economy.
Some car makers, particularly Japanese companies that have a big market share in the Northeast, said snow in
early February affected sales.
Ford's U.S. sales chief, Ken Czubay, said the underlying strength of the auto industry, driven by low interest rates,
new model and pent-up demand should overcome any potential drag from mandatory government spending cuts
that are imposed. Full-implementation of that so-called sequestration could cut a half a point of growth off the U.S.
gross domestic product in 2013, Ford's senior economist estimated.
Many car-shoppers remain upbeat despite the wrangling in Washington, said Regina Dahm, general manager of
Motor City Mini, which opened a new and expanded showroom in Southfield, Mich., last month. "Our floor traffic
doubled in the second half of February, so we feel good going into March and April," she said.
Her family's company, Eitel Dahm Motor Group, logged solid sales at its BMW, Audi and Porsche dealerships as
well, she added.
Still, Jonathan Browning, chief executive of Volkswagen Group of America, said angst over possible job cuts and
tax increases already is affecting consumers, and suggested that the pace of sales gains may moderate in the
months ahead, compared with the solid gains the industry posted in the first two months of the year.
"The failure to resolve the debate over spending and to have a plan to avoid further protracted confusion
surrounding the debt ceiling means we will take a more cautious approach to our market forecast, inventory levels
and production planning for 2013."
Mr. Browning said he is sticking with his forecast of 15.1 million new-vehicle sales for the year -- low among
industry executives. U.S. sales of the VW brand rose 2.9% in February.
General Motors Co. said its sales rose 7.2%, while Ford Motor Co. posted an increase of 9.3% and Chrysler
Group LLC, a 4.1% jump. Toyota Motor Corp. reported a 4.3% rise. Honda Motor Co. said its sales declined 2%,
and Nissan Motor Co. reported a 6.6% decline.
Importantly for U.S. auto makers, sales of pickup trucks continue to rise. GM said sales of its Chevrolet Silverado
pickup jumped 30% from a year earlier to 41,634 and Ford said its F-series pickups rose 15% to 54,489.
Chrysler's Ram brand trucks increased 3% to 23,289. Trucks are high-profit vehicles for the domestic auto
makers and growth in the home-building market should help to push up those sales throughout the year.
Document J000000020130304e9340002h

A High-Dollar Debutante Ball
GENEVA MOTOR SHOW

Automobiles; SECTAU
A High-Dollar Debutante Ball
By JERRY GARRETT
690 words
3 March 2013
The New York Times
NYTF
4
English
A glittering bumper crop of million-dollar babies will be shown at the 83rd International Motor Show in Geneva,
where press previews begin on Tuesday.
While mass-market automakers like Fiat, Ford, General Motors and Volkswagen are struggling in Europe with
bloated inventories, falling sales and red ink, many luxury brands are reporting record sales and profits. Hence,
an unprecedented number of ultraexpensive new cars will be mixed among the 130 or so premieres at Geneva.
Ferrari, Lamborghini and McLaren will take the wraps off vehicles priced above $1 million. Lamborghini's
limited-edition sports car may set a record for vehicular excess; the car is rumored to carry a price tag of more
than $4 million.
Not far behind, in terms of stratospheric prices, will be new six-figure vehicles from Rolls-Royce, Bentley, Aston
Martin and a wide array of the boutique car builders, performance tuners and design houses that make the
Geneva show an annual carnival of automotive excess.
Price, of course, does not necessarily correlate with significance. Here are some of the important, but not
necessarily as expensive, debutantes that will make an appearance:
Alfa Romeo 4C This sports coupe, which the company has called ''the compact supercar,'' will be built at a
Maserati plant and lavished with Ferrari-derived technologies. Later this year, the 4C will spearhead Alfa's return
to the United States market after an absence of nearly 20 years. By Geneva standards, the car is somewhat of a
bargain, with a price expected in the mid-five-figure range.
Aston Martin Centenary Vanquish To celebrate 100 years in business, Aston is producing a limited run of 100
special editions of its Vanquish coupe, offering features previously available only in its $2 million-plus One-77
hypercar. Centenary versions are also planned for the Vantage, DB9 and Rapide.
Bentley Flying Spur To differentiate itself further from the Continental GT coupe, and move further upscale in
presence and price, the Flying Spur sedan gets its own platform and styling treatment. Engineering advances will
pump output from its W-12 engine up to 616 horsepower.
Chevrolet Corvette convertible Something of a surprise as a European debut -- especially so soon after the coupe
was shown in Detroit in January -- the Stingray droptop will make its first appearance in Geneva. The car will
appear at the New York auto show this month and reach showrooms by December.
Ferrari F150 Ferrari's new limited-edition successor to the Enzo supercar, code-named F150 (no relation to the
Ford pickup), will be finally shown at Geneva after months of teasers. If you could buy one -- and you can't,
because Sergio Marchionne, the Fiat Group's chief executive, says the car is already sold out -- you'd need
around $1.3 million. Production of the 900-horsepower monster is expected to be limited to 499 cars, 100 more
than the Enzo.
Hyundai ix35 Fuel Cell This car began rolling off the assembly line last Tuesday in Ulsan, South Korea. Hyundai
says that makes it the first automaker to offer a mass-produced hydrogen fuel cell vehicle. Annual production of
this variant of the Tucson crossover isn't expected to hit 1,000 units until 2015.

McLaren P1 Not to be trumped by Ferrari in pricing, exclusivity or horsepower, McLaren will show the production
version of its P1 supercar with 903 horsepower, a $1.15 million price and a production run of just 375.
Qoros 3M A Chinese-Israeli venture of Chery Automobile and the Israel Corporation holding company, this
nascent marque hopes to begin selling cars in Europe this year. The Qoros 3 compact sedan will be shown in
Geneva along with two concept cars, including a hybrid crossover.
Rolls-Royce Wraith A two-door version of the Ghost sedan with a sloping fastback roofline, this new coupe is
expected to reach customers in the fourth quarter.
INDEPENDENCE: The Bentley Flying Spur gets its own distinct identity. (PHOTOGRAPH BY BENTLEY
MOTORS); CAR WITHOUT BORDERS: The Qoros 3, product of a Chinese-Israeli venture. (PHOTOGRAPH BY
QOROS)
Document NYTF000020130303e9330003r

Ahead of the Tape
Ahead of the Tape

Ahead of the Tape
By Spencer Jakab
426 words
1 March 2013
J
C1
English
Car Market Still Has Another Gear to Use
It is beginning to feel a lot like 2007 in Detroit. But in a good way.
Before most U.S. auto makers slid into bailouts and bankruptcy, light-vehicle sales were a heady 16 million a
year. Industry leaders have made clear they aren't building their businesses based on that heyday and have
stripped out overheads accordingly. Could we get back there soon?
Yes -- if consumers change their behavior.
Friday's reports on February car sales are likely to show a rise to 15.5 million vehicles on an annualized basis,
according to Edmunds.com, among the best figures of the recovery.
But an analysis from Bankrate shows that a typical U.S. household can afford to spend $17,535 on a new car.
The average cost last year was $30,000.
Sales today are being boosted by car loans that cost about half of what they did in 2007 and by rising credit
availability.
Overall costs of ownership, though, are barely lower than in 2007. The difference back then? Spending power
was boosted by funds from home-equity cash-outs. Toward the end of the boom, the number of cars exceeded
the number of licensed drivers.
Even so, the market may return to 16 million a year one way or another. The U.S. car fleet now totals around 245
million and is, on average, a record 11 years old. It may keep aging as a result of thrift and better vehicle quality,
but the pace at which cars are scrapped eventually must rise.
Assuming cars get scrapped with an average of 160,000 miles on the odometer, including those destroyed in
accidents, annual sales should rise to at least 16.5 million just to keep the fleet from shrinking or aging. That is
good news for General Motors Co., Ford Motor Co. and Chrysler Group LLC.
The bad news is that disposable income is growing only slowly, and other costs of car ownership such as
gasoline and insurance are painfully high. That affects the type of vehicles people choose.
For example, January had an 18.1% increase in small-car sales and a 7.5% drop in large SUV sales. The former
are less profitable.
Comparing the new 16 million to the old 16 million is like comparing apples and oranges. Or Chevy Cruzes with
GMC Yukons.

Document J000000020130301e93100018

Motor homes takin' it to the streets once more ; Hard-hit industry on the road again
MONEY
Motor homes takin' it to the streets once more ; Hard-hit industry on the road again
Chris Woodyard
1,472 words
1 March 2013
USAT
FINAL
B.1
English
Bill and Jill Phipps shuttle between homes around the country to keep in touch with grandchildren. But they got
tired of crating up Rockne, their Irish Wolfhound mutt, for seven-hour plane rides.
So, with some trepidation, the Tucson couple recently became first-time RVers.
They took delivery of a new 24-foot motor home a few months ago, contributing to a wave of sales that are lifting
an industry rebounding from the depths of recession.
Deliveries of motor homes from manufacturers to dealers rose 13.6% last year and are expected to climb by
almost the same amount this year, the Recreation Vehicle Industry Association reports. Last year marked the
third year of increases from a recessionary bottom that saw sales fall to the lowest levels since at least the 1970s.
With the spring RV-buying season approaching, there's growing optimism within the industry that affluent families
and retirees like the Phippses are ready to take the plunge. After a round of consolidation, including bankruptcy
filings by a couple of the industry's big names, motor home makers are starting to hit the road again.
That's good not only for the RV industry but for the economy in general. Purpose-built motor homes typically retail
for more than $100,000, and because they're used for vacations, they're the ultimate discretionary purchase. The
pickup in sales is an early indicator that people might be willing to start spending on big- ticket items again -- and
not just on things they can't do without.
But it's also an American comeback story: Almost all RV rigs are U.S.-made, many in Indiana. Unlike the auto
industry, motor home makers have few foreign competitors, although some are knocking. "People are tired of
waiting for things to turn around," says Sheila Davis, spokeswoman for Winnebago Industries. Some customers
"who could have bought a motor home during the downturn chose to wait. Now, they are feeling more confident."
That confidence is bolstered by waves of retiring Baby Boomers, their 401(k)s fattened by the stock market's
recent rally, who always dreamed of roaming the hinterlands.
Working against makers, however, are the painfully slow pace of the recovery and persistently high and
unpredictable fuel prices.
Efficiency upgrades
To deal with economic reality, the industry has tried to make models that are more affordable and fuel-efficient.
There's no denying the industry's progress. Five companies -- Winnebago; Fleetwood RV; Thor Industries; Tiffin
Motorhomes; and Forest River, part of Berkshire Hathaway -- account for more than 75% of motor home volume,
says Scott Stropkai, national RV sales manager for Statistical Surveys, the industry's sales tracker. Both sales
and stock prices are up from a year ago.
Winnebago shares doubled last year, and the company's earnings exceeded analysts' expectations in its most
recently reported quarter. In announcing earnings in February, Thor Industries, which has Airstream and other
brands, reported that motor-home sales had almost doubled from the same period in the previous year.

Fleetwood, which was bought by a private-equity firm after a bankruptcy reorganization during the recession, is
encouraged by the trends as well. "We have seen notable growth over the past six months," John Draheim,
Fleetwood's CEO, said in a statement. "Motor home sales continue to gain momentum, which makes us optimistic
about what the traditional spring- and summer-selling seasons will bring."
Ford Motor announced in February that it is boosting motor home chassis production by 35% to meet burgeoning
demand. It says registrations of motor homes built off its engine and chassis are at their highest level since 2007.
"We are increasing our participation in this industry as motor home customers return to the market," Ken Czubay,
Ford's vice president for marketing in the U.S., said in a statement.
Despite much higher price tags, motor homes are posting bigger sales gains than travel trailers. The RVIA
predicts that manufacturers' deliveries of motor homes will show twice the increase as that of the overall RV
industry, which includes trailers.
The comeback "is a reflection of the American economy as we dig out of the recession," says Sherman
Goldenberg, publisher of trade publication RV Business.
Another positive sign: The unemployment rate in Elkhart County, Ind., the center of the motor home industry and
its suppliers, has dropped below 10% after rising above 20%. Still, it has a way to go before it falls below 6%
again, where it held for most of the last decade. It's an "unbelievable story of recovery," Goldenberg says.
To help rev sales, the industry has retooled itself. It's luring buyers with new products that feature:
Value. Makers are finding ways to add luxury touches, yet make motor homes more affordable. "Value pricing is
very much the order of the day," Goldenberg says. Winnebago, for instance just introduced a Vista model last
summer that starts at $69,999, about $30,000 below other coaches in its size and type class. It's "fully featured
but cost-effective," Davis says.
Technology. To lure existing motor home owners to upgrade, makers are loading up units with flat-screen
televisions, high-speed Wi-Fi connectivity, LED interior lighting and other modern touches. Antennas that used to
be hard to adjust while the vehicle was speeding down the highway now take care of themselves.
Fuel efficiency. Some of the biggest sales growth in deliveries this year could come in van conversions, especially
those built on platforms such as the Mercedes-Benz Sprinter. The van offers up to 18 miles a gallon on the
highway, more than double the mileage of a traditional purpose-built motor home. Chrysler, Ford and Nissan will
soon be offering similar UPS-style vans that could add to the conversion business.
Though they save on gas, the Sprinter conversions don't come cheap. For example, Airstream, a unit of Thor,
sells its Interstate conversion starting at $140,000. But it's another example of how the RV industry is reaching out
to new customers.
Hitting a different market
Instead of courting traditional RV owners, Airstream aims the Interstate at affluent shoppers who might have little
regard for a big RV with flashy graphics but who crave luxury goods, have multiple homes and are drawn to a
smaller motor home with the Mercedes logo on the grille.
The Interstate "really hit the sweet spot of luxury buyers," says Tim Garner, general manager for Airstream
touring coaches. To reach its target customers, Airstream de-emphasized RV shows and instead displayed at
more more traditional car shows.
They found buyers such as the Phippses. "We've never had a boat, a motor home. We've never camped out. This
was something of a lark," says Bill.
To travel the country, the couple didn't want a rig that was too big, so they went with the Interstate. Jill says the
diesel engine's economy rivals the fuel mileage of her Lexus crossover SUV.
The retirees bought the motor home to make trips to their home in South Carolina and to see family in Ohio, but
they're already plotting weekend trips to fun spots in Arizona.
"I do most of the driving," she says. "He fiddles with the electronics."

The Phippses stand in contrast to Brian and Laura Meske, who caught the RV bug long ago. They've owned four
motor homes, and they just bought a new one, a 34-foot Tiffin Allegro.
The decision to buy a new RV was an easy one for the Warrenton, Va., couple, once they stopped by a dealer:
"They just made a deal we couldn't resist," he says, and it probably helped to be buying during the winter.
Brian says they use their motor home about 30 nights a year, for weekend getaways and longer trips, such as a
visit to Yellowstone National Park. They always take along their King Charles spaniels.
The upsurge in motor home demand is proving beneficial not only to makers, but to suppliers. John Sztykiel, CEO
of Spartan Motors, which makes motor home chassis, expects his company will have a strong year because of
pent-up demand for RVs and easier credit.
He also predicts that younger buyers will get into the RV market.
Easy to see why, he says: Having a motor home "forces us to get away and leave all the distractions of the house
and the job behind."
photo Ty Wright, Bloomberg News An employee works on a motor home at Nexus RV in Elkhart, Ind. The jobless
rate in Elkhart County, center of the motor home industry and its suppliers, has dropped below 10% after rising
above 20%.
Document USAT000020130301e93100009

Partial engine power loss hits some Fords ; Feds open early probe of problem
MONEY
Partial engine power loss hits some Fords ; Feds open early probe of problem
James R Healey
481 words
26 February 2013
USAT
FINAL
B.1
English
The federal government and Ford Motor are probing partial engine failures on some 725,000 recent-model
vehicles that could cut engine power, often at highway speed.
Affected: 2009 through 2011 models of Ford Escape and Mercury Mariner SUVs and Ford Fusion and Mercury
Milan sedans.
The National Highway Traffic Safety Administration and Ford report nearly 1,500 complaints that appear related
to the problem; three crashes were cited with one injury. No deaths have been reported.
The engines aren't the EcoBoost versions that have had fire problems in newer models. But, coming not long
after those failures, the new investigation is sure to continue clouding Ford's image.
NHTSA says the engines in this case don't quit running but erroneously shift into one of three reduced-power
"limp-home" modes. The sudden cut in power can feel to a driver as if the engine stalled, NHTSA notes. And one
mode varies engine speed to keep from stalling, which the agency says is likely to have triggered some
complaints of engine surging.
Many vehicles have such "limp-home" settings. If the engine computer senses a problem in the drivetrain, it cuts
power to avoid ruining the engine or related components, but leaves just enough power to, as the name suggests,
limp the vehicle home or to a service shop at greatly reduced speed.
The faulty parts were made by Delphi, NHTSA says. Delphi and Ford issued a technical service bulletin (TSB) in
2009 describing to dealers how to fix the problem. But NHTSA says it continued getting complaints, including on
2010 and 2011 models, and, "The complaints show an apparent increasing trend."
An example from NHTSA files:
The owner of a 2011 Fusion told the agency last September that the car experienced the problem after the dealer
performed the suggested fix in 2009, and later replaced the entire component involved, not just the electronic
portion. The component is called a throttle body; it controls airflow into the engine's cylinders.
The government says it began taking a look at the vehicles last year after a letter dated Aug. 30, 2012, from the
North Carolina Consumers Council, citing engine problems related to throttle body assemblies.
On Oct. 2, NHTSA created what it calls a "defect petition" case to judge whether to open an investigation. The
North Carolina letter cited problems just with the Escape, but said they involved 2005- 2012 models.
NHTSA opened the probe Feb. 21, and now has posted the notice to its website. It broadened the vehicle array
under investigation, but compressed the model years involved.
NHTSA's investigation is a preliminary evaluation, the lowest- level investigation. The final step is a recall.
photo Charlie Riedel, AP Ford Escapes roll off the line in 2009.
Document USAT000020130226e92q0000a

CFO Journal: Why the Pension Gap Is Soaring --- Companies Struggle to Get Handle on Liabilities as Low Rates, Other Forces Inflate Funding...
CFO Journal: Why the Pension Gap Is Soaring --- Companies Struggle to Get Handle on Liabilities as Low
Rates, Other Forces Inflate Funding Needs
By Vipal Monga
1,065 words
26 February 2013
J
B1
English
When United Parcel Service Inc. said last month that it was taking a noncash charge of $3 billion tied to its
pension plan, the package-delivery giant blamed what might seem like an unrelated event: the downgrade last
summer of several big banks by Moody's Investors Service.
But the connection between the two incidents illustrates the complexities of calculating pension liabilities -- and
how little power companies have in keeping them under control.
During the current earnings season, companies including UPS, Boeing Co., Ford Motor Co. and Goodyear Tire &
Rubber Co. have disclosed yawning pension-fund deficits, even though they have plowed billions of dollars into
their plans and strong stock markets have boosted their investment returns.
Across America's business landscape, the gap between the amount that companies expect to owe retirees and
what they have on hand to pay them was an estimated $347 billion at the end of 2012. That is better than the
$386 billion gap recorded at the end of 2011, but the two years represent the worst deficits ever, according to J.P.
Morgan Asset Management.
The firm estimates that companies now hold only $81 of every $100 promised to pensioners.
In general, everything happening on the liability side of the pension equation is working against companies. A big
source of the problem: persistently low interest rates, set largely by the Federal Reserve.
Pensions are promises made by employers to pay their workers a set amount of benefits after they retire. In their
financial statements, companies are required to show those promises as a liability. But unlike other debts that a
company might take on, the size of this liability can fluctuate wildly from year to year based on the prevailing
interest rates.
Over the past year, some companies have tried to limit that volatility by shuffling some pension obligations off
their books. General Motors Co. and Verizon Communications Inc. transferred roughly $25 billion and $7.5 billion,
respectively, in liabilities to Prudential Financial Inc. In exchange for existing assets in the plans and fresh cash
injections, the insurer took over responsibility for paying out those obligations to retirees.
Putting a value on a pension liability is tricky business. Benefits for individuals workers typically are based on their
pay and years of service. A company must also take into account how long retirees are likely to live.
"When companies made those promises year ago, they didn't know how they would affect their balance sheets
years later," says Karin Franceries, executive director at J.P. Morgan Asset Management.
Pension liabilities change over time as employees enter and leave a pension plan. For financial-reporting
purposes, companies use a so-called discount rate to calculate the present value of payments they expect to
make over the life of their plan.
The discount rate serves as a proxy for the hypothetical interest rate that an insurance company would expect on
a bond today to fund a company's future pension payments. The lower the discount rate, the greater the
company's pension liabilities.

Boeing's discount rate, for example, fell to 3.8% last year from 6.2% in 2007. The aircraft manufacturer said in a
securities filing that a 0.25-percentage-point decrease in its discount rate would add $3.1 billion to its projected
pension obligations. Boeing reported a net pension deficit of $19.7 billion at the end of 2012.
The discount rate is based on the yields of highly rated corporate bonds -- double-A or higher -- with maturities
equal to the expected schedule of pension-benefit payouts.
Moody's decision last summer to lower the credit rating of big banks hurt UPS and other companies by booting
those banks out of the calculation. And because bonds issued by some of those banks carried higher yields than
other bonds used in the calculation, UPS's discount rate fell 1.20 percentage points.
Another contributor to the pension gap is the fact that people are living longer. Goodyear cited increased life
expectancy for its plan's beneficiaries as one reason its global pension gap widened to $3.5 billion last year from
$3.1 billion in 2011.
The combination of low rates and longer life spans has made it tough for pension plans to keep pace. Between
2009 and 2012, companies in the Russell 3000-stock index have added $1 trillion in assets to their pension plans
through investment returns and contributions, but their overall deficit still rose to an estimated $441 billion from
$392 billion over that period, according to J.P. Morgan Asset Management.
But just as falling interest rates have created a massive hole in pension funding, pension plans could quickly
recover if interest rates started to climb.
A report by actuarial consulting firm Milliman found that a 0.27-percentage-point increase in the discount rate and
strong equity returns in January helped the deficit of the 100 largest corporate pension plans shrink by $106
billion last month.
That marked the second-largest monthly improvement ever in Milliman's pension funding index, and completely
reversed the $74 billion deficit increase recorded for all of 2012.
Still, companies aren't betting that rising interest rates will fix their liability problem in the near term, especially
since the Fed said in October it expects to keep rates very low through mid-2015.
As a result, apparel maker VF Corp. is pursuing a "liability driven investment" strategy, in which it will move out of
equity investments and into fixed-income investments like bonds, said Bob Shearer, the company's chief financial
officer.
The switch will allow VF to better match the duration of its returns to those of its obligations. That should, at least
in theory, limit the earnings volatility caused by its pension deficit. Falling interest rates, which would increase
pension liabilities would also increase the value of fixed-income pension assets.
One insurance-company actuary said other companies could follow suit, seeking relief from their pension burden.
"You could see a rush for the exits," said Peggy McDonald, senior actuary in Prudential's pension unit.
---
Emily Chasan contributed to this article.
Document J000000020130226e92q00017

A Hatch Marinated in Hot Sauce
AROUND THE BLOCK

Automobiles; SECTAU
A Hatch Marinated in Hot Sauce
By LAWRENCE ULRICH
775 words
24 February 2013
The New York Times
NYTF
4
English
TESTED 2013 Ford Focus ST
WHAT IS IT? The most hopped-up American hatchback in, well, forever.
HOW MUCH? $24,495 base; $28,170 as tested
WHAT MAKES IT RUN? A 2-liter turboc EcoBoost 4-cylinder making 252 horsepower; 6-speed manual.
HOW QUICK IS IT? Automobile magazine spurred the ST from a standstill to 60 m.p.h. in 6.2 seconds, a
half-second quicker than the 200-horse Volkswagen GTI.
IS IT THIRSTY? The E.P.A. rating is 23 m.p.g. city, 32 highway.
ALTERNATIVES Mazdaspeed 3, Subaru WRX, VW GTI.
About a decade after sparking up its fondly recalled Focus SVT -- then inexplicably setting it aside -- Ford has
rediscovered the smoky pleasure of a hot hatchback. It was worth the wait.
With the fine, largely German-engineered Focus as its bedrock, the ST sticks sharp elbows into a perennial
benchmark, the Volkswagen GTI. And while the lavishly equipped Focus brings its own form of Euro
sophistication, it adds a delightful layer of Yankee aggression.
That American edge may be only metaphorical. The Focus ST was developed under a German-born engineer,
Jost Capito, when he was the head of Global Performance Vehicles at Ford. Mr. Capito, who has since left to
manage VW motorsports, formerly led Porsche racing and Red Bull's Formula One team.
With minor tweaks, this Focus would be right at home on a track. I tested mine in Florida, where the ST was as
loud, fast and sweat-inducing as a Miami nightclub -- a bold counterpoint to the smooth GTI.
In contrast to the grinning air inlet of the Mazda 3, Ford turns the smile upside-down, giving the Focus a
blackened glower that suits its character. Other attention-getters include a jutting roof spoiler, snowflake-shaped
18-inch wheels and a paint color called Tangerine Scream.
The hue seems more taxicab than tropical, but the Focus wore its maize coat proudly, even when it crashed a
nighttime gaggle of Bentleys at the Breakers hotel in Palm Beach. The young valet who escorted the ST
practically giggled when he handed me back the keys, making it clear whose car he favored.
The dashboard -- black and bulging, all vents and sharp angles -- is akin to Darth Vader's helmet breathing in
your face. Three dashtop gauges display turbo boost, oil pressure and temperature. Recaro sport buckets are a
teenage dream, with swollen bolsters, black ribbed inserts, contrasting yellow fabric and red-embossed STs on
the headrests. But as with every Focus, the footwells are confining.
While Ford's troublesome MyFord Touch infotainment unit has drawn deserved complaints, one of its strong
points is rarely mentioned: the voice commands are pretty slick. Just recite a street address, hands-free, and
boom -- the system has you locked in and on your way.
''Locked in'' also describes the car's performance. Like the Mazdaspeed 3, the ST holds a power and speed
advantage over most pocket rockets.
Despite Ford's mechanical and computerized countermeasures, mashing the gas pedal produces roller-coaster
waves of torque steer, yanking the wheel in your hands. But give Ford credit for not sanitizing the experience; it's
up to the pilot to keep a foot to the floor and hang on tight.
Steering, tire grip and suspension balance are all remarkable for a front-drive car in this class. And the handling
assumes skill on the driver's part. The Focus acts more like a rear-drive sports car, avoiding the plodding
understeer that scrubs the front tires and kills the joy.
Lift off the throttle on corners and the rear end pivots into a thrilling yet easily controllable slide. I can't think of
another front-drive car that's so easy and fun to pivot around its axis.
The Focus ST gives up some refinement to the GTI, but that's also true to its nature. The shifter isn't perfect, but it
is eager and effective. Full-throttle shifts at redline send jarring clunks through the powertrain. Another
disadvantage is the trucklike turning circle of 39.4 feet.
Ford's capless fuel filler -- just insert nozzle and pump -- is an innovation every automaker might emulate. But the
12.4-gallon tank quickly runs dry.
For neighborhood ruffians who want a vaguely obnoxious hot hatch as a play partner, take my advice: write a
check to the Ford dealer before your parents demand the money for rent.
MOUTH BREATHER: The high-performance ST version of the Focus has a powerful turbo 4-cylinder.
(PHOTOGRAPHS BY FORD MOTOR)
Document NYTF000020130224e92o0002v

Sign of a Comeback: U.S. Carmakers Are Hiring

Sign of a Comeback: U.S. Carmakers Are Hiring
By BILL VLASIC
921 words
22 February 2013
The New York Times
NYTF
1
English
DETROIT -- A few years ago, American automakers cut tens of thousands of jobs and shut dozens of factories
simply to survive.
But since the recession ended and General Motors and Chrysler began to recover with the help of hefty
government bailouts and bankruptcy filings, all three Detroit car companies including Ford Motor Company have
achieved one of the unlikeliest comebacks among industries devastated during the financial crisis.
Now steadily rising auto sales and two-tier wage concessions from labor have spurred a wave of new
manufacturing investments and hiring by the three Detroit automakers in the United States. The latest
development occurred on Thursday, when Ford said it was adding 450 jobs and expanding what had been a
beleaguered engine plant in Ohio to feed the growing demand for more fuel-efficient cars and S.U.V.'s in the
American market.
Ford, the nation's second-largest automaker after G.M., said it would spend $200 million to renovate its Cleveland
engine plant to produce small, turbocharged engines used in its top-selling models. Ford plans to centralize
production of its two-liter EcoBoost engine -- used in popular models like the Fusion sedan and Explorer S.U.V. --
at the Cleveland facility by the end of next year.
Its move to expand production in the United States is yet another tangible sign of recovery among the Detroit auto
companies. Industrywide sales in the United States are expected to top 15 million vehicles this year after sinking
beneath 11 million in 2009.
Last month, G.M. announced plans to invest $600 million in its assembly plant in Kansas City, Kan., one of the
company's oldest factories in the country. And Chrysler, the smallest of the Detroit car companies, is adding a
third shift of workers to its Jeep plant in Detroit.
The biggest factor in the market's revival has been the need by consumers to replace aging, gas-guzzling models.
''Pent-up demand and widespread access to credit are keeping up the sales momentum,'' said Jessica Caldwell,
an analyst with the auto research site Edmunds.com.
And Joseph R. Hinrichs, the head of Ford's Americas region, explained in an interview that the company's Ohio
revival plan was ''all based on increased demand.''
''We're putting the capacity here because that's where we need it most,'' he said.
Yet even though Ford is enjoying a resurgence in the United States, it is racing to reduce costs in its troubled
European division. The workers in Spain who were building the small EcoBoost engines that have been shipped
to America will be moved to an assembly plant that is taking on work from a plant to be closed in Belgium.
While Ford survived the industry's financial crisis without government help, it still cut thousands of jobs and
shuttered several factories to reduce costs and bring production more in line with shrinking sales.
But now, the burst of showroom business has prompted automakers to increase output at remaining plants. In
Ford's case, the company added about 8,000 salaried and hourly jobs last year, and has said it plans to hire
about 2,200 white-collar workers in 2013. Ford is also moving some vehicle production from Mexico to a Michigan
plant, where it will add 1,200 jobs.
The investment in Cleveland is indicative of how Ford and other carmakers have trimmed domestic labor costs
and improved productivity since the recession. Just a few years ago, the company was forced to consolidate two
engine plants into one in northern Ohio, and close a major component operation. ''No question we have been
through a lot in northern Ohio,'' Mr. Hinrichs said. ''But now our North American business is very competitive with
the best in the world.''
Mr. Hinrichs said that a new local agreement with the United Automobile Workers union in Cleveland paved the
way for the expansion. Currently the plant employs about 1,300 workers.
The Detroit companies are also benefiting from their ability to hire lower-paid, entry-level workers as part of their
national contract with the U.A.W. Many of the 450 new workers at the Cleveland plant will start at $16 an hour,
compared to about $28 for veteran union members, and some of the new engine plant workers could include
employees from other Ohio plants.
''With our competitive labor agreements, we can bring business back to the U.S. from Spain and Mexico,'' Mr.
Hinrichs said.
Employment still falls far short of levels in the 1990s, when cheap gas and the popularity of S.U.V.'s led to big
profits in Detroit.
The auto manufacturing sector employed 1.1 million people in the United States as recently as 1999, according to
a recent study by the Center for Automotive Research in Ann Arbor, Mich. About one-third of those jobs were in
the final assembly of vehicles, and the balance in the production of auto parts.
Employment dropped as low as 560,000 in 2009. Since then, about 90,000 jobs have been added, the report
said.
Joseph Hinrichs, head of Ford's Americas region, with a two-liter EcoBoost engine at the Cleveland plant.
(PHOTOGRAPH BY TONY DEJAK/ASSOCIATED PRESSTONY DEJAK/ASSOCIATED PRESS) (B1); Testing a
V-6 engine at Ford's Cleveland plant. Production of a popular small engine is being moved there from Spain.
(PHOTOGRAPH BY MARK DUNCAN/ASSOCIATED PRESS) (B4)
Document NYTF000020130222e92m0004r

Corporate News: Lexus, Porsche Top Quality Survey
Corporate News: Lexus, Porsche Top Quality Survey

By Jeff Bennett
586 words
14 February 2013
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Toyota Motor Corp.'s Lexus brand took the top spot for the second year in a row in a widely followed survey of car
quality as U.S. buyers overall reported fewer problems on average with their late-model vehicles.
The survey, which measures everything from wind noise to mechanical and electrical problems experienced by
37,000 owners of three-year-old vehicles, shows the quality gains made in recent years, according to researcher
J.D. Power and Associates.
The average number of problems measured was 126 per 100 vehicles, down from 132 per 100 last year and from
170 in 2009, J.D. Power said.
Lexus topped the list with just 71 problems per 100 vehicles, Volkswagen AG's Porsche was second, followed by
Ford Motor Co.'s Lincoln and Toyota's namesake brand. Both latter brands had 112 problems per 100 vehicles.
Daimler AG's Mercedes-Benz ranked fourth.
General Motors Co.'s Cadillac fell to 14th place from third a year ago, putting the brand below the industry
average. J.D. Power cited problems with its 2010 SRX model.
GM, on a companywide basis, scored above the industry average for the first time since 2005 as Buick ranked
fifth and Chevrolet took the 10th spot, narrowly beating out the industry average.
Quality impacts repeat purchases with most buyers choosing to switch brands if they experience even one major
problem with their current car or pickup truck, according to the annual survey.
More than half of economy vehicle buyers -- who reported one issue with their vehicle when surveyed by in the
past -- bought a different brand on their next car buying trip. Luxury-car owners were more loyal with 53% sticking
with their brand with one issue. Two problems with a vehicle and that ratio flipped with 53% switching to another
brand, the survey said.
The willingness to abandon a brand underscores the challenges auto makers face as more consumers expect
their vehicles to remain reliable for a longer period.
Among the Detroit Three, Fiat SpA's Chrysler Group LLC brands languished at the bottom. Jeep, Dodge and
Chrysler were ranked among the seven worst. Mr. Sargent pointed out that the survey doesn't yet include the
vehicle portfolio redesign initiated by Chrysler Chief Executive Sergio Marchionne after he took over the auto
maker following its bankruptcy in 2009.
The redesigned versions will appear in next year's survey. Chrysler's one bright spot was the Ram pickup truck
brand, which jumped to the ninth spot overall. Last year, it was fourth from the bottom.
On the opposite end, Tata Motors Ltd.'s Land Rover finished last with 221 problems per 100 vehicles, followed by
Dodge with 190, Mitsubishi Motors Corp.'s Mitsubishi and Jeep with 178 and Volkswagen with 174.
This is also the first time in four years there were fewer reported problems for all-new or redesigned models
compared with older "carry-over" vehicles that received no upgrades.
"There is a perception that all-new models, or models that undergo a major redesign, are more problematic than
carry-over models," said David Sargent, vice president of global automotive at J.D. Power. "Data suggests that

this isn't the case. The rapid improvement in fundamental vehicle dependability each year is more than offsetting
any initial glitches that all-new or redesigned models may have."
Document J000000020130214e92e00018

The few, the proud, the female engineer ; Meet the women moving car industry
MONEY
The few, the proud, the female engineer ; Meet the women moving car industry
Jayne O'Donnell
Jayne O'Donnell, @jayneodonnell, USA TODAY
1,629 words
13 February 2013
USAT
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Alicia Boler-Davis was the first General Motors plant manager to also lead a vehicle launch -- for the popular
Chevrolet Sonic.
At Chrysler, Chris Barman headed the team that designed the new Dodge Dart.
Rebecca Seiler and Jennifer Shaw helped develop some of Ford Motor's advanced safety technologies that
prevent crashes.
Female engineers -- despite their stubbornly small numbers in all industries -- increasingly have a big impact on
the vehicles and safety features that Detroit is offering. Yet among nearly 28,000 members of the Society of
Automotive Engineers, only 1,500 -- 5% -- are women.
"There have certainly been strides, but certainly not as much as the employers would like," says Betty Shanahan,
executive director of the Chicago-based Society of Women Engineers, which encourages engineering as a career
choice.
The reasons for the scarcity of female engineers in the auto industry are varied and complex. The recession had
a particularly chilling effect on U.S. automakers -- GM and Chrysler both filed for Chapter 11 bankruptcy
protection -- which led to job losses and an exodus of women and others to other industries.
But the ranks of female engineers are thin elsewhere, too, and societal factors often get the blame. The number
of women earning bachelor degrees in engineering increased dramatically in the 1970s and '80s, due in part to a
more feminist climate that encouraged women to consider traditionally male careers, Shanahan says. The growth
began to level off around 2000, however.
A 2010 report by the American Association of University Women concluded several factors influence the dearth of
women in science, technology, engineering and math. It found that women had to grapple with stereotypes that
they weren't as capable as men in those fields and contend with sometime unwelcoming science and engineering
departments in colleges and universities.
Automakers and others are working on the problem. Betsy Homsher, dean of students at Kettering University in
Flint, Mich., says, "If you added up all the money the top 10 automakers have spent on hiring women, training
them and grooming them for advancement, I wouldn't be surprised if it was in the billions."
Among the efforts:
Chrysler has a mentoring program that matches women from different parts of the company. The Chrysler
Institute of Engineering also matches its new employees with more established sponsors and tries to match
women with other women.
Automotive Next is part of Inforum, the Midwestern women's professional organization, and works to recruit and
retain women in the auto industry. A Generation Y committee advises the group on the particular concerns of
30-and-under workers.

Nissan, which has increased the number of female engineers in management positions by 50% in the past three
years, just started a sponsorship program that monitors the career paths of female engineers it believes have
high potential.
Yet there are still roadblocks.
"It remains a fairly hostile environment for women, especially on the plant floor as women start out their careers,"
Homsher says.
Boler-Davis, 43, had some convincing to do when she took over in several plant manager posts. Even if they only
said, "You look very young," Boler-Davis says it was often clear when outsiders came in for meetings that they
were "shocked when they saw I was the plant manager." She acknowledges that the plant environment can be
intimidating for female engineers, but she focused on what she and her mostly male colleagues had in common,
rather than their differences. "I'm very emotional in my personal life, not so much in my work life," she says.
But for some women, that emotional connection -- especially in the workplace -- is what they crave. A number of
women have drifted away from automotive engineering jobs in plants because they found they desired jobs that
allowed for more interaction with others, Homsher says.
"If you spend all your time working on (engineering) a door, your level of satisfaction may be considerably less
than if you work in HR and develop a policy that allows working professionals to job- share so they can raise their
children," Homsher says.
Big rewards in safety
Still, plenty of women have found auto engineering a way to both save lives and improve them.
Ford engineer Seiler, 40, is the only woman on a 30-person team working on technology that warns drivers and
then automatically begins to stop cars when crashes are imminent. As a key engineer developing the current and
future versions of the technology, she spends most of her time developing portions of the algorithm to perform
tasks and then trying out the systems at the test track, using inflatable cars in case it doesn't work.
Seiler says people thank her for helping develop systems that prevent crashes. "People come up to me and say,
'I was in a near miss. I wasn't paying attention to that driver that cut in front of me,'" Seiler says. "People really
appreciate it."
Shaw, 35, is the supervisor on an "active safety" team of 11, including two other women. She helped develop
Ford features including the self-parking system for parallel parking and technology that warns when a moving car
is in your blind spot.
"If I was working on microchips, I'd be very far away from the customers, but here I'm working on a product every
day that is affecting people's lives," says Shaw.
Shaw also worked on Ford's keyless entry and ignition, something that solves the problem for people -- including
her mother -- who don't like having to dig for their keys.
Gay Kent, General Motors' safety vice president, also found the safety field especially rewarding. She helped
design an auto industry first: side air bags that deploy out of the driver's seat above the center console to prevent
injuries or deaths caused by contact with the car or another head.
Chrysler Group CEO Sergio Marchionne recently singled out vehicle line executive Chris Barman, 41, for her
work developing the Dodge Dart, which he called "tangible evidence of how women are helping to lead the new
Chrysler."
In prepared remarks, he added, "Chris is just one example of the women who are making a huge impact in every
area of our company."
Early influences
Seiler grew up outside Detroit, but her father was a tool distributor and her mother a nurse practitioner. A middle
school visit to space camp led her to engineering. She dreamed of becoming a space shuttle astronaut, but a
Ford summer internship and downturn in the space industry turned her to cars.

Shaw's father was a retired civil engineer who designed parking lots and roads. Her mother was a high school
math teacher, and science was never off the table. She also went to an all-girls Catholic high school where she
was told "women could do whatever they wanted to do."
Kent grew up in a Detroit-area neighborhood with three girls and 15 boys with a father who was an engineer for
Chrysler. While working on transmissions in the 1980s, she found it rewarding to test a car and "get it to shift at
the point you wanted it to" after drawing shift patterns on paper.
After graduating from college with a BS in engineering, Barman was hired by Chrysler's Institute of Engineering,
which rotates people through different areas in the company. When she finished, she asked to work in brake
engineering.
"Our brakes were terrible," says Barman. "I thought, 'I know I can go there and make an impact.'"
She did. One of the vehicles she worked on in the late 1990s, the Sebring convertible, went from having the most
brake noise to the least.
Work-life balance
Often, it is that opportunity to make a difference that female engineers say they find most compelling. Even when
it causes complications in their lives. Barman likes to tell freshmen women at Purdue University, her alma mater,
about her work studying Mercedes-Benz's electronic stability control when Chrysler was owned by Daimler.
She tells them about the thousands of lives that are expected to be saved when the now-mandated stability
control is on all vehicles.
"Women want to feel like they are making an impact on the world around them," Barman says. "So I tell them I
was part of bringing this technology into Chrysler products."
And she did it while working on a Mercedes team of 200 associates. She was one of only two women. The other
was on maternity leave.
But striking a work-life balance can be hard -- especially when raising a family. Barman credits her husband,
Brian Dunn, a manager at a Chrysler truck assembly plant, as they share care for their son and daughter, ages 11
and 13.
Last year, Boler-Davis was named vice president of global quality and U.S. customer experience. She and her
husband, a salesman with a more flexible schedule, share care of their two boys, ages 7 and 10, who play
several sports. The juggling can be tough, especially because she sometimes works 15-hour days. Boler- Davis
says she's had "those times where I wake up in a middle of the night and say, 'This is not going to work.'"
But the support at home helped her lead development of the Sonic, the only U.S.-built subcompact.
Boler-Davis knows she is a trailblazer. "I'm conscious of that, and I want other women and minorities to have an
opportunity," she says.
photo Jeff A. Kowalsky for USA TODAY Ford engineers Jennifer Shaw, left, and Rebecca Seiler have led
development of cross traffic alerts and collision warnings.
Document USAT000020130213e92d0000k

Eyes on the Road: Five New Technologies To Make Driving Easier
Eyes on the Road: Five New Technologies To Make Driving Easier

By Joseph B. White
1,152 words
13 February 2013
J
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Corrections & Amplifications
The Lincoln MKZ sedan was incorrectly identified as a sport-utility vehicle in the Eyes on the Road column on
Wednesday.
(WSJ Feb. 14, 2013)
(END)
There's a technology revolution in the auto business, and it involves more than streaming radio apps and
voice-activated Facebook updates.
Consumers who haven't shopped for a new car for five or more years -- and that's a lot of people, since the
average U.S. vehicle has been on the road for just over a decade -- may encounter some exotic new advances.
To attract safety-conscious drivers, some car makers are revisiting the question, "Is there anywhere else we can
stash an air bag?" Night-vision systems not unlike what the military uses to spot enemies in the dark are
appearing at the upper reaches of the luxury market. And to meet tougher fuel-economy standards, car makers
are installing transmissions with up to nine speeds.
Only a few customers might order such novel features. But what starts out as a costly, brand-burnishing option in
a luxury sedan often migrates into wider use as technology prices invariably drop. Here's a sample of new
technology hitting showrooms this year.
Click an Inflatable Seat Belt
Auto makers and safety-technology suppliers such as Sweden's Autoliv have developed shoulder straps with air
bags built in. In the U.S., Ford Motor Co. was the first to offer this bag-in-belt technology on 2011 Explorers. Now,
Mercedes-Benz will offer it on its new S-Class sedans.
Although traditional lap and shoulder belts prevent thousands of deaths a year, they can also cause what
researchers call "seat-belt syndrome." The belts can lead to severe injuries to organs, muscles and spines,
especially in violent crashes. Inflatable seat belts are meant to reduce this risk. Traditional air-bag systems
mounted in the car's steering wheel and elsewhere use a hot gas to rapidly inflate the bag during a crash. To
prevent burns, bag-in-belt systems use a cold gas to inflate its protective bladder.
Ford says it currently offers bag-in-belt systems on four models -- the Explorer, the Flex wagon and the Lincoln
MKT and MKZ sport utilities. About 25% of people who buy those vehicles order the bag-in-belt option, Ford says.
Mercedes says it will likely move the technology into other models, but isn't outlining specific plans.
Spot Pedestrians in the Dark
Safety regulators around the world are increasingly focused on motor-vehicle accidents involving pedestrians,
and that's spurring development of new systems to help drivers see people on foot before it's too late.

More than 4,000 pedestrians a year die in the U.S. after being hit by a car. Nearly 70,000 were injured in
motor-vehicle accidents in 2011, according to government data. Many of these incidents happen at night.
This year, German luxury brand BMW AG is launching a "dynamic-spotlight" technology that uses an infrared
camera mounted behind the grille to see down the road ahead. Software can pick out the outline of a person (or
animal) and signal the car's headlights to illuminate them -- and help prevent a collision. The system also shows
an in-cabin alert, projecting an icon representing a person enclosed in a yellow triangle onto either a dashboard
screen or the windshield.
Design Your Own Dashboard
Dashboards used to be static displays with mechanical dials and gauges. Now, auto makers are ditching the dials
in favor of programmable screens that can display more information and allow drivers to personalize the look of
the cockpit displays.
The new Lexus IS F-Sport model, due out this June, uses a thin-film transistor display and a moving tachometer
dial (which measures RPMs) to create a hybrid of the traditional and the new. The technology is adapted from
Lexus's super sports car, the LFA.
By toggling a control on the steering wheel, the driver can get the big dial in the center of the dashboard to move
to the right, revealing a flat-screen display that can be customized for two different drivers. "We can change
languages, miles per hour to kilometers" and show information such as route guidance, says Bill Camp of Lexus's
training operation, Lexus University.
Shift Into Ninth Gear
Ever-tougher federal demands for fuel efficiency have led car makers to add more gears to transmissions. And
more. And more.
You don't have to be very old to remember when most cars came with four-speed transmissions. Now, Chrysler
Group LLC says it will introduce a nine-speed gearbox designed to fit into a relatively small, front-wheel-drive car.
ZF Friedrichshafen AG, the German company that makes the nine-speed transmission, says it can improve fuel
economy by 10% to 16% compared with a six-speed automatic, mainly because it offers a wider spread of gears
to keep the engine in the "sweet spot," where it's turning as slowly as possible to stay at a certain speed.
Such a transmission's challenge lies largely in the software that controls the vehicle's shifting. Too much and
drivers could feel as if the car is constantly changing gear and not running smoothly. Too little and the
fuel-economy benefits don't materialize.
Michael Ebenhoch, director of ZF's front-drive transmission development, says that with nine speeds, "we are
getting closer to the maximum" for a passenger car. On the other hand, he says, "the guy who developed the five
speed said we don't need six."
Drive by Computer
Traditionally, steering a car has involved a series of mechanical connections that allow the wheel in your hands to
guide the four wheels on the road. Infiniti's new Q50 sedan -- which replaces the current G series in the Nissan
Motor Corp. luxury brand's lineup -- boasts the industry's first so-called steer-by-wire system, which swaps out
those mechanical elements with an all-electronic system.
Proponents say an electronic signal can be faster than a mechanical linkage at translating what the driver does
with the steering wheel to the road. The electronic system also allows drivers to choose among four different
degrees of serenity or sportiness in the handling. If the electronics fail, Infiniti says a backup mechanical-linkage
system will keep the car under control.
The steer-by-wire system is part of an array of technology on board the Q50, including advanced cruise control
and radar-enabled braking, that allows the driver to take control when the road is fun and twisty, but also enables
the car to handle a lot of driving work itself during a routine commute.
Document J000000020130213e92d00021

Companies Fret Over Uncertain Outlook
Companies Fret Over Uncertain Outlook

By Scott Thurm
1,021 words
11 February 2013
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Sensing better times ahead, investors have pushed the Dow Jones Industrial Average up this year near its record
high. But a different mood is pervading U.S. companies, where executives are less optimistic about the global
economy and their own prospects, and many are lowering financial forecasts.
Fourth-quarter operating earnings topped diminished expectations, rising 7.3% at the 339 members of the
Standard & Poor's 500-stock index that have reported results, while revenue rose 5.9%, according to Thomson
Reuters. But the companies warn that the current quarter will be more challenging, and analysts project
first-quarter earnings at S&P companies will rise just 1.7%, Thomson Reuters says, or less than half what they
were predicting at the beginning of the year.
Sixty-three S&P companies have lowered their forecasts for first-quarter earnings, according to FactSet
Research, while 17 have raised them, the largest disparity since the firm began tracking the data in 2006.
Many executives see shrinking economies in Europe. Closer to home, they worry about hesitant U.S. customers,
chilled by continued Washington gridlock.
In a sign of executive caution, a Wall Street Journal survey of 50 S&P companies found they plan to increase
investment this year by 2%, signaling a dearth of big growth opportunities. Through the first nine months of 2012,
S&P companies boosted investment 8%, following a 20% increase in 2011.
Consider Corning Inc. The glassmaker said on Jan. 29 that it plans to cut spending on new plants and equipment
this year by 28%, to $1.3 billion from $1.8 billion, with most of the decline at its LCD operations. Corning reported
a 42% drop in fourth-quarter net income and forecast lower sales and earnings in the current quarter.
The Journal's findings echo a December survey of chief financial officers by Duke University and CFO magazine.
CFOs responding to the survey said their companies plan to increase investment spending 2.6% this year, down
from projections for the following 12 months of 3.7% in September and 7.8% in December 2011.
"Investors are ignoring [companies'] guidance and responding to economic indicators that revenue and earnings
will go higher this year," said Edward Yardeni, president of Yardeni Research, a research and consulting firm. He
sees signs that U.S. personal income and corporate spending are creeping higher after declining late in 2012.
Other analysts say the stock rally also reflects rock-bottom yields on bonds and investors' relief that Congress
averted potentially big tax increases for most Americans at the start of the year.
"Ongoing uncertainty in the global economy will continue to present challenges in what we expect will be a slow
growth environment," Dow Chemical Co. Chief Executive Andrew Liveris told analysts on Jan. 31.
Dow posted a fourth-quarter loss on lower revenue as sales slowed in Asia and declined in Europe. In October,
the Midland, Mich., chemical maker said it would shut 20 facilities and eliminate 2,400 jobs. Dow plans to invest
$2 billion in plants and equipment this year, down from $2.6 billion in 2012. A spokeswoman said the company
generated more than $4 billion in cash from operations last year.
Other companies are also trimming investment plans. Paper maker MeadWestvaco Corp. said Jan. 30 it expects
lower first-quarter profit than a year ago, and a spokesman said the company's land sales will decline.

Chief Financial Officer E. Mark Rajkowski projected "a substantial decline" in capital spending this year, from
$660 million last year, after the company completed expansion of a paperboard plant in Brazil and installation of a
new boiler at a plant in Virginia.
As investments shrink, Mr. Rajkowski said MeadWestvaco would use some of the savings to repurchase up to
eight million company shares, or roughly 5% of the shares outstanding. The company also paid $1 in dividends
last year, nearly equal to its $1.16 in earnings per share.
MeadWestvaco joins a long list of companies handing more cash back to shareholders. Dow boosted its dividend
in April and accelerated its January payment to Dec. 31 to avoid the expected Jan. 1 tax increase. Corning
increased its dividend in November for the second time in as many years and launched a new buyback program.
All told, S&P companies spent $500 billion paying dividends and repurchasing shares in the first nine months of
last year, up 2% from the same period in 2011 and 38% from 2010. Dividend payments increased more sharply in
the fourth quarter as companies sought to distribute payouts ahead of the expected tax increases.
"Many executives are still being very cautious" about the economy, said John Graham, a Duke finance professor
who runs the CFO survey.
Not all companies are holding back, though. Motorcycle and off-road vehicle maker Polaris Industries Inc. plans to
double its investment spending to roughly $200 million this year on top of a 22% increase last year. Polaris is
building a new factory to produce off-road vehicles in Europe, where sales increased last year and are now 10%
of revenue. It also plans expansions at factories in the U.S. and Mexico.
Other companies planning big investment increases this year include General Dynamics Corp., Whirlpool Corp.
and Ford Motor Co. Despite expected losses of $2 billion on its European operations, Ford says it will invest $7
billion, up from $5.5 billion in 2012, to accommodate growth and new products.
Even some of the cautious are offering investors glimmers of optimism. Dow's Mr. Liveris told investors "the
outlook in China is also growing brighter," and predicted that country's economy would grow 7% this year.
General Electric Co. and Alcoa Inc. also predict faster growth in China.
Such comments fuel hopes that corporate earnings will accelerate through the year. By the fourth quarter,
analysts expect earnings at S&P companies to grow 14% compared with a year earlier.
Document J000000020130211e92b0002i

Ford to Sell Plug-Ins At More Dealerships
WHEELS
Automobiles; SECTAU
Ford to Sell Plug-Ins At More Dealerships
By JIM MOTAVALLI
341 words
10 February 2013
The New York Times
NYTF
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English
Ford said Wednesday that it expected to increase the number of dealers certified to sell its plug-in hybrid and
battery electric vehicles to more than 900 in all 50 states by this spring. Amanda Zusman, a Ford spokeswoman,
said in an interview that Ford was now "closing in" on 500 certified dealers. "It's moving very quickly," she said.
The 900 dealerships represent about a third of the company's total sales outlets in the United States, Ford said.
Ford is selling the Focus Electric and plug-in hybrid C-Max Energi. The Energi version of the Fusion goes on sale
this winter. Only 774 Focus Electrics were sold through January and 2,712 C-Max Energis in the same period.
Ford said in a statement that its dealer surge "reflects increased demand for the company's electrified vehicles."
Chad D'Arcy, marketing manager for the Focus Electric, said in an interview that, to become certified, dealers had
to undergo product training, install at least two Ford-branded Leviton charging stations, undergo an
energy-efficiency assessment, display point-of-purchase materials and acquire the necessary service tools.
Making the cars more available, which Ford has been talking about for months, is just one part of the company's
strategy to sell more plug-in cars. Last month the company also reduced the cost of the slow-selling Focus
Electric's three-year lease by up to $10,750 for customers taking retail delivery by April 1 and offered a $2,000
discount on cash purchases. Credit buyers get 1.9 percent financing through Ford.
Mr. D'Arcy said the lease price cut was in part a pass-along of the $7,500 federal tax credit that was available to
consumers who buy the car, but accrued to the company in leases. "We're making the lease customers whole,"
he said.
Document NYTF000020130210e92a000b6

Toyota beefs up Tundra for a fight ; Watch out, Detroit, new truck's meatier, more luxurious, too
MONEY
Toyota beefs up Tundra for a fight ; Watch out, Detroit, new truck's meatier, more luxurious, too
Chris Woodyard, James R Healey
Chris Woodyard, and James R. Healey, USA TODAY
1,176 words
8 February 2013
USAT
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Toyota sent shivers through Detroit six years ago by taking aim at its most profitable vehicles with a completely
redesigned full- size pickup.
The 2007 Tundra, Toyota's second-generation effort at a full- size pickup, bolted out of the gate with sales of
nearly 197,000 that model year. But that was Tundra's peak. Since then, it's been battered by the recession, hurt
by Toyota's recall-damaged reputation and overtaken by rivals' updates.
Now the big Japanese automaker is trying again with a third- generation 2014 Tundra that was unveiled Thursday
at the Chicago Auto Show and goes on sale in September. It's restyled inside and out to give it a more muscular
look and more refined passenger quarters.
And, taking a clue from the Detroit Three, Toyota is headlining two new high-end, lavishly appointed models for
buyers whose unmuddied boots are always hand-tooled. No hint of prices, but the top-end models of Ford, GM
and Ram pickups cost $54,000 to $60,000.
While the fanciest pickups account for only about 9% of sales, according to TrueCar.com, they ensure that no
money's left on the table. And they give automakers prestigious models to show off, making dollar-conscious
business buyers feel they're getting bargains when they spring for $35,000 trucks.
Tundra continues to try to get a bigger piece of a pie dominated and staunchly defended by the Detroit Three,
which depend on pickups for most of their profit.
"The big-truck segment is the only one Toyota wasn't able to conquer," says Jesse Toprak, veteran
industry-watcher at TrueCar.com. "So there's some pride resting on it."
Ford F-Series, the nation's best-selling vehicle for decades, accounts for two-thirds of Ford Motor's U.S. profit,
estimates Adam Jonas, analyst at Morgan Stanley. Domestic makers need those profits as non-truck buyers
increasingly turn to lower-priced small cars.
In the face of Tundra and a new full-size Nissan Titan expected for 2015, Detroit isn't sitting still. General Motors
just introduced a new lineup of full-size trucks, the 2014 Chevrolet Silverado and GMC Sierra, on sale second
quarter this year. Ford showed a concept called the Atlas at the auto show in Detroit last month that is the
forerunner of its next F-150. Chrysler gave its 2013 model Ram pickup a significant update.
The new Tundra will increase that competition. For buyers, it could mean a protracted price war as makers try to
steal buyers. But the pickup market is growing as the economy inches back, with pickup sales up 10% this year
vs. a 7% gain by the overall new-vehicle market, says TrueCar.com, so discounting might not be dramatic.
Strong new looks
Tundra is dramatically restyled in a way that seems aimed to lure more die-hard truck buyers. The design
"emphasizes heft and masculinity," says Jack Nerad, analyst for Kelley Blue Book who attended the unveiling
here. "There were those who thought (the current Tundra) was not brawny enough."

Tundra was designed at Toyota's studio in Newport Beach, Calif., and will be built at its plant in San Antonio. But
underneath all that swoopy new sheet metal, Tundra remains largely unchanged from the underpinnings of the
model it will replace in September.
The big change comes in how the Tundras will be outfitted. Besides the three current trim levels, Toyota is adding
two pricier ones that fill the trucks with more gadgets, premium leather and just about every other luxury. One is
simply called Platinum. The other is the 1794 Edition, named for the ranch on which Toyota's Texas truck factory
was built.
The Platinum will feature perforated black leather-trimmed seats and instrument panel inserts to give it an "urban"
feel. The type of leather is a first for a Toyota truck. Other niceties include a 12- speaker JBL audio system,
heated and ventilated front seats and a rear cross-traffic alert. The 1794 Edition is similarly upscale but goes the
cowboy route, with lots of embossed leather to evoke saddle gear.
The new Tundra will continue to offer three cabs -- regular cab, a four-door "double cab" and the four-door
CrewMax.
The powertrains carry over from 2013. They include a 270- horsepower, 4-liter V-6; a 310-hp., 4.6-liter V-8 and a
381-hp. 5.7- liter V-8. No diesel or hybrid is offered, but Toyota officials here also did not rule them out. Ford and
Toyota are still jointly researching hybrid systems for pickups, notes Bill Fay, Toyota's group vice president.
"They're still talking."
Toyota's first Tundra full-size pickup was in 2000, when it replaced the smaller T100. But it didn't become a full
contender until the 2007 model year when it was completely redone based on research into truck buyers' needs
and enlarged to better rival Detroit's mainstays. Toyota built its new pickup plant deep in the heart of Texas,
America's best truck market.
Toyota sold 196,555 Tundras of that model year, increasing its share of the market to 8.9%, according to
Edmunds.com. But sales fell with the economy. Last year, Toyota sold just 101,621, a 6.1% share.
Trying to compete not just for numbers but profits, Toyota is embellishing the Tundra to compete better in the
lucrative high end.
Profit makers
Ford says about one in three of its pickups is priced at more than $35,000 -- and it has kept adding upscale
models. One, the F- 150 Limited, can be ordered with a red leather interior. Chrysler's Ram created a new luxury
pickup last year, and General Motors continues to expand its GMC Sierra Denali luxury models.
"They are making great profit on full-sized pickups, period," says Mark Williams, editor of PickupTrucks.com. "You
tag on the premium options packages, and it's just profit stacked on top of profit."
But Morgan Stanley's Jonas notes that while high-end trucks allow makers to pack on profits, they are still a
relatively small part of the market -- and of overall earnings.
Toyota isn't deterred. "The segment is moving more in that (the upscale) direction," Fay notes. "We're adjusting
our strategy and direction."
But Ford's F-Series and Chevrolet's Silverado remain the two biggest-selling vehicles in the U.S., as they have for
years. And truck buyers are notoriously brand loyal, making it even harder for Toyota to poach market share.
But it's going to make another try with its new Tundra.
photo Anne Ryan, USA TODAY Bill Fay, group vice president, introduces the new Toyota Tundra at the Chicago
Auto Show on Thursday. It has a more muscular look and more refined interior.
Document USAT000020130208e92800010

Apple's New Normal
Business World
Apple's New Normal
By Holman W. Jenkins, Jr.
868 words
6 February 2013
J
A11
English
Henry Ford didn't invent the automobile. He didn't invent the assembly line. He invented the mass-market auto
industry. In its first full year of production, the Model T captured just 11% of a market consisting of 123,990 cars.
Fifteen years later, in 1924, the Model T represented 62% of a market consisting of 3,185,881 cars. To say the
growth of the auto market was largely the growth of the Model T would be no exaggeration.
Two years later, the market was still growing but Ford's share wasn't merely shrinking in relative terms. Sales of
the Model T were plummeting in absolute terms.
The story of Apple, so far, is the story of Ford before the cliff. Sales of its dominant iPhone are still growing but
market share is shrinking and so are profit margins. Apple can continue to be a strong player, but its dominance
of the phone and tablet markets has begun to erode and management will have a job just defending its
now-diminished share price. This is what the dramatic correction of recent weeks is telling us.
Apple didn't invent the digital musical player, the graphical user interface or the touchscreen. It invented iTunes
and the iPod, added a phone and screen and adapted them to the mobile broadband networks that were already
being created. Apple also lucked into the unseen serendipity (even by Apple) of the app revolution.
Apple's accomplishments during its heyday boiled down to a single accomplishment. Its design and engineering
teams were leaps ahead of all others in incorporating the latest technological possibilities into a package that
could fit in your hand. Apple was unbeatable because of its mastery of the iPod form factor.
What was the likelihood that Apple would remain unbeatable? Zero. Nowadays the newest things being fitted into
your hand aren't hardware and operating-system innovations at all. They are cloud services, which Apple hasn't
been strong at (Google has) and which Apple isn't necessarily likely to become strong at.
The Model T couldn't have been the Model T unless the automobile were on its way to becoming too interesting a
product for consumers ever to be satisfied with a single model, a single manufacturer, a single design statement.
The same is true of the iPhone. Different customers not only want different things from their smartphones, they
want difference for its own sake, which explains the otherwise inscrutable shifting of coolness cachet from the
iPhone to Samsung's Galaxy S line.
Some analysts still hope that ecosystem lock-in will let Apple lock in considerable dominance of a market that
otherwise wants to explode into diversity. But ecosystem lock-in was never the strong force it was cracked up to
be. The coming of the cloud was destined to obliterate any inclination toward winner-take-all, as Pandora and
Spotify have already begun making iTunes look like a convoluted nuisance.
Nor did the slightest reality attach to the hope that Apple somehow would keep finding new industries to reinvent
the way the iPod reinvented music distribution. This was a bet on soft and squishy miracles in a competitive world
full of people every bit as intelligent and cunning as Apple's leadership. The desperation with which stock punters
have posited TV as Apple's next opportunity has been especially pathetic to watch.
Also true, though, is that these unrealistic expectations never found their way into Apple's share price. All through
the company's spectacular run, the stock was priced skeptically in relation to the growth that was actually coming.
Indeed, it would not be too strong to say that a skeptical stock market has treated the cash on Apple's balance
sheet (currently $137 billion) as if it were a sizable share of all the cash the company would ever earn.

The drop in Apple's share price, down 36% since mid-September, has not been the popping of a bubble or a
collapse of confidence in management. The drop is easy to arrive at simply as the multiple of some modest
lowering of Apple's expected sales growth and some modest lowering of its expected profit margin on those
sales. The world thought Apple (in Model-T terms) was entering 1925. Now it thinks early 1926 may be closer to
the mark.
Not that this means some horrible, Ford-like sequel lies ahead -- wherein management refuses to adapt to a
market where competitors have caught up and in some ways surpassed the Model T. Tim Cook and his
management team ought to be up to avoiding self-delusion. No offense to Steve Jobs, but a charismatic founder
has more leeway to commit catastrophic mistakes.
But here's a scary thought. By definition, Apple's share price today rests even more heavily on its vast cash
hoard. If the company really wants to disappoint shareholders, just keep fanning their fear that they'll never see
this cash in the form of dividends or stock buybacks.
Document J000000020130206e9260000t

Low Rates Force Companies To Pour Cash Into Pensions
Low Rates Force Companies To Pour Cash Into Pensions

By Mike Ramsey and Vipal Monga
1,396 words
4 February 2013
J
A1
English
Ford Motor Co. expects to spend $5 billion this year shoring up its pension funds, almost as much as the auto
maker spent last year building plants, buying equipment and developing new cars.
The nation's second-largest auto maker is one of a who's who of U.S. companies pouring cash into pension plans
now being battered by record low interest rates. Verizon Communications Inc. contributed $1.7 billion to its
pension plan in the fourth quarter and -- highlighting companies' sensitivity to this issue -- Boeing Co. now reports
"core earnings" to separate out pension expenses.
"It is one of the top issues that companies are dealing with now," said Michael Moran, pension strategist at
investment adviser Goldman Sachs Asset Management.
The drain on corporate cash is a side effect of the U.S. monetary policy aimed at encouraging borrowing to
stimulate the economy. Companies are required to calculate the present value of the future pension liabilities by
using a so-called discount rate, based on corporate bond yields. As those rates fall, the liabilities rise.
Of course, low interest rates also help companies. Ford, for instance, can borrow money cheaply and use it to
offer cut-rate loans or other discounts to help sell its cars. Ford borrowed $1.2 billion to contribute to its pension.
When interest rates rise again, the pension shortfalls should narrow and could even become surpluses. But when
that will happen is difficult to predict. The Federal Reserve has committed to keeping rates low for another two
years at least.
Pension plans became popular in the U.S. in World War II as a means of compensating workers rather than using
pay raises.
As the workforce grew, these pension plans grew enormous. They started to fall out of favor because of their
large balance sheet liabilities and costs in the 1980s. Companies shifted from defined benefit plans -- those that
manage the investment portfolio and guarantee set payments to retirees -- to defined contribution schemes like
401(k) retirement savings plans, where the retirees are responsible for their own investment decisions.
Jeff Chiappetta, 66, a retired plant manager at Chrysler Group LLC, watched a portion of his pension designated
for management-level workers disappear in Chrysler's 2009 bankruptcy proceedings. He watches keenly what is
happening to pensions.
"Luckily, the majority of [my pension] made it through bankruptcy," he said. "Do I feel lucky to have grown up in an
era where I had a pension? Definitely. But can that be sustained? It looks like it can't."
Today, many of the companies contributing to the pensions are struggling with the costs but don't offer defined
benefit plans to new workers.
According to the most recent statistics by the U.S. Department of Labor, the number of defined benefit plans fell
to 46,543 in 2010 from 103,346 in 1975. Many of the largest companies are still carrying the funds on their books.
Consulting firm Towers Watson tallies 584 of the Fortune 1000 companies had defined benefit plans at the end of
2011, down from 633 in 2004.
Andrew Liveris, chief executive of Dow Chemical Co., which posted a loss of $716 million for the fourth quarter,
said the company faces a "massive pension headwind" because of the change in the discount rate that added

$2.2 billion to its pension liability. Pension expense this year is going to rise between $250 million and $300
million.
"Other companies have got it, and so we're not alone, but clearly those are big numbers for us," Mr. Liveris said.
Overall, pension plan funding fell by $79 billion last year at about 400 large companies with defined benefit plans,
according to preliminary estimates by Towers Watson. The total estimated deficit at those firms now stands at
$418 billion, 23% more than in 2011, and the highest since the firm began tracking.
Companies, which by law must keep defined benefit pension plans funded within a certain period of time, are
taking a variety of paths to address the issue. They are buying out pensioners, unloading pension accounts to
third parties and upping their contributions.
Ford's unfunded liability expanded to $18.7 billion at the end of 2012, despite a series of efforts by the company
to get a handle on the problem. "It has got to be a problem for any large company that has a defined benefit plan,"
said Ford Chief Financial Officer Bob Shanks.
Ford embarked on a pension buyout plan for salaried workers, which knocked out $1.2 billion in liabilities through
year-end, and it will continue trying to buy out workers this year.
Ford also contributed $3.4 billion into the funds -- $2 billion more than legally required.
In the end, however, falling interest rates in the U.S. and Europe, where Ford has had operations in England for
100 years, erased its gains. Ford's pension plans had strong real-world returns -- up more than 14%. But the
company had to lower its discount rate to 3.84% from 4.6%, which created a bigger liability on its balance sheet.
Ford, intent on hitting a goal of getting to a fully-funded pension by mid-decade, is committing to spend $5 billion
on its pensions this year. It is using $1.2 billion in borrowed funds to pay into the accounts, as well as cash on
hand.
In the U.S., Ford and its Detroit rivals, General Motors Co. and Chrysler fought with the United Auto Workers
union for years to reduce retiree health-care expenses. All three U.S. companies were able to off-load the
expenses to union-run trust funds. But the bulk of union pension plans remained the responsibility of auto makers,
even surviving the government-backed bankruptcy proceedings of General Motors and Chrysler. Ford didn't seek
bankruptcy-court protection.
GM has off-loaded its entire salaried worker pension fund, which represents about 110,000 retirees, to Prudential
Insurance Co. Even so, GM still has a much larger union worker fund that was underwater last year and is
expected to be underfunded as of the end of 2012.
Boeing also is pouring money into its pensions. The Chicago aerospace company plans to spend $1.5 billion in
cash to shore up its fund in 2013 after putting in $1.6 billion last year. The fund currently stands at 26% below the
liability.
The pension's drag on earnings is so great, Boeing started to break out "core earnings" for investors to give a
snapshot of the business that excludes its pension expenses.
"The continued decline in the pension discount rates, driven by the unprecedented low interest rate environment,
has caused a significant noncash increase in our pension expense," said Greg Smith, Boeing's CFO.
Telecommunications companies AT&T Inc. and Verizon Communications both reported big hits to recently
released fourth-quarter results because of the effect of low discount rates on their pension plans.
AT&T posted a loss of $3.9 billion, but most of the loss came because the company lowered its discount rate, and
therefore increased its liability. Last fall, AT&T said it would contribute $9.5 billion in company stock to its funds in
an attempt to shore them up.
Verizon, which took a $4.4 billion charge for pension valuation changes and other expenses, took a path similar to
GM last year. It sent $7.5 billion in pension funds to Prudential to manage.
While pensions may be an anchor on capital for many companies, for hundreds of thousands of workers, they
represent deferred pay and a commitment that kept them working at a particular company when other offers were
dangled.

The promise of a pension kept Weldon Gorlich, 80, working for Ford for 30 years as a tool maker at two plants in
New Jersey that are no longer open.
He had a chance to move to General Motors, but wanted to get his pension and stayed. "That's very true, that
and the medical benefits," said the Florida resident.
"I thank God every morning to wake up with what I have."
---
Jon Ostrower contributed to this article.
Document J000000020130204e92400024

Automakers Join Forces On Fuel-Cell Cars
WHEELS
Automobiles; SECTAU
Automakers Join Forces On Fuel-Cell Cars
By JIM MOTAVALLI
664 words
3 February 2013
The New York Times
NYTF
4
English
An existing fuel-cell alliance between Ford and Daimler added a third partner, Nissan Motor, on Monday to form a
new international brain trust to develop hydrogen technology. The companies hope to start the "world's first
affordable, mass-market fuel-cell electric vehicles as early as 2017," they said in a statement.
The three companies agreed to share costs equally on the development of a common fuel-cell stack and other
systems "to speed up availability of zero-emission technology and significantly reduce investment costs." At a
news conference in Germany, Thomas Weber, Daimler's research and development head, said the partners
would produce 100,000 vehicles, though the time frame was unclear. Alan Hall, a Ford spokesman, said in a
telephone interview, "We're not talking about volumes in terms of our participation."
The strategic fuel-cell partnership between major automakers complements a similar compact between BMW and
Toyota, completed last week. The two companies had earlier said they would work together on developing new
technology.
Daimler had previously said it would commercialize a fuel-cell car in 2014 or 2015, so the new later date
represents something of a strategic retreat, said Peter Hoffmann, editor and publisher of the Hydrogen and Fuel
Cell Letter. But Mr. Hoffmann also said in an interview that the three-way announcement was "very positive"
because it would result in a stronger alliance.
In an e-mail, Matthias Brock, a spokesman for Daimler, described the company's new time frame as "a revised
planning."
Mr. Brock added: "In fact, we skip the planned intermediate step with lower volumes and go directly toward
large-scale production. All partners together plan to bring a five-digit number of fuel-cell electric vehicles on the
market."
Carla Bailo, senior vice president for research and development at Nissan Americas, said in an e-mail that fuel
cell technology was "the logical next step" in the company's introduction of zero-emission vehicles. She said the
company's current development work on fuel cells began in 1996, and by 2012 it had reduced the cost of its
proprietary stack to a sixth of a similar 2005 unit. "This progress has helped to convince us that Nissan will be
ready to provide an affordable, fuel-cell electric vehicle to the mass market as the infrastructure to support comes
on stream," she said.
Byron McCormick, the former executive director of General Motors' fuel-cell program, said in an interview that the
new partnership made "perfect business sense," because large orders of components could persuade suppliers
to reduce costs.
Ford and Daimler are already working together in the Automotive Fuel Cell Cooperation, started in 2008 and
based in Vancouver, Canada. Mr. Hall said that fuel-cell stack work would continue in Vancouver, as well as in
other parts of the world. "We're combining the experience of three global automakers," Mr. Hall said. "Ford sees
fuel cells as a complement to our current strategy of offering customers a choice of fuel-efficient options, including
battery electrics, hybrids, diesels and gasoline direct injection."

Daimler and the Renault-Nissan Alliance have also worked together on development of fuel-efficient powertrain
technology, said Travis Parman, a Nissan Americas spokesman.
A major hurdle in the commercialization of the fuel-cell car is the need for networks of hydrogen stations in
potential deployment markets, including California. In announcing their alliance, the three automakers said their
collaboration "sends a clear signal to suppliers, policy makers and the industry to encourage further development
of hydrogen refueling stations and other infrastructure necessary to allow the vehicles to be mass-marketed."
Monika Wagener, a spokeswoman for Ford in Europe, said in a telephone interview that fuel-cell vehicles could
overcome the range limitations of battery electric vehicles, assuming the hydrogen infrastructure had been
established.
Document NYTF000020130203e9230002u

Europe's Car Woes Damp 2013 Outlook
Europe's Car Woes Damp 2013 Outlook

682 words
30 January 2013
J
B8
English
Europe's worsening economic conditions present a growing problem for the big three U.S. auto makers with North
American results increasingly counted on to produce nearly all their profits this year.
Ford Motor Co. warned on Tuesday that its operating losses in Europe this year would hit $2 billion -- $500 million
more than it estimated only three months ago -- on weaker sales than it had forecast. Meanwhile, General Motors
Co. recently indicated it hopes to speed up a plant closing in Germany, which could result in hefty severance and
closing expenses this year.
While Ford and GM aim to reduce costs in Europe through capacity reductions, Chrysler Group LLC's output is
helping offset majority owner Fiat SpA's plunging sales in southern Europe. Fiat is to report fourth-quarter
earnings results Wednesday.
Ford Chief Financial Officer Bob Shanks said a plan to cut 18% of its European capacity and close three plants by
2014 is on track and deeper cuts could come if necessary. Ford expects to spend about $500 million on
restructuring its European operations this year.
"Clearly we have a lot of difficult times ahead of us" in Europe, he said. "We do think it will probably bottom this
year and start to go up."
Sales in Europe's 19 largest auto markets this year likely will be lower than 13.5 million units, nearly a 20-year
low.
Europe's woes are sure to play prominently in GM's fourth quarter results, which are expected to be released on
Feb. 14. The company said in October its European operations could lose between $1.5 billion and $1.8 billion for
2012 depending on restructuring costs in the fourth quarter. Last year it lost $747 million. The region isn't
expected to return to break-even on an operating basis until mid-decade.
Earlier this month, GM raised a warning flag that its struggles there may be increasing. GM Chief Executive Dan
Akerson told reporters he was worried that Germany, home of its struggling Adam Opel unit, also may be slipping
into a recession.
Vice Chairman Stephen Girsky has said he is considering closing Opel's Bochum, Germany, plant by 2015,
nearly two years earlier than planned, unless executives and unions can wring out more costs. The plant employs
about 3,000 workers.
Ford's warning of a larger than expected loss in Europe triggered a sell off in automotive shares. Ford slipped
4.6%, or 64 cents, to $13.14 while GM lost 1.3% to $28.45, both in 4 p.m. New York Stock Exchange trading.
While Europe is a sore sport, both auto makers continue to generate hefty profits in North America, where a
rebounding economy is driving sales. Ford's fourth quarter pretax earnings of $1.87 billion in its home market
were a record, propelling Ford to overall net income of $1.6 billion in its fourth quarter.
Full year and quarterly results for the auto maker were lower than in 2011, before the onset of big losses in
Europe and difficult market conditions in South America. Ford earned $13.62 billion in the fourth quarter of 2011
and $20.2 billion in the full year. More than half of the 2012 profit was due to a one-time, noncash tax benefit.
The Dearborn, Mich.-based company forecast that its total 2013 operating results will be about the same as
2012's $7.96 billion.
Revenue rose 1.9% to $36.5 billion, driven by jumps in Asia and North America that outweighed falling sales in
Europe.
Its South American operations had a quarterly pretax profit of $145 million, compared with $108 million a year
earlier. For the year, its South American operations reported a pretax profit of $213 million compared with $861
million in 2011. Mr. Shanks said currency devaluation in Venezuela and Argentina are likely to hurt profits in
2013.
Document J000000020130130e91u0003f

Eyes on the Road: Why Your Car's Mileage May Not Always Measure Up
Eyes on the Road: Why Your Car's Mileage May Not Always Measure Up
By Joseph B. White
1,229 words
30 January 2013
J
D1
English
It's possible to get precise measurements of nearly every feature of a car, from trunk space to front hip room. But
the most important attribute for many shoppers -- fuel economy -- is still just an estimate.
Drivers, regulators and car makers have long been vexed by the variance between the mileage figures published
on a showroom vehicle's window sticker (which are based on Environmental Protection Agency testing protocols)
and the car's real-world fuel consumption. Now, federal regulators and auto makers are rethinking how to close
the gap between their fuel-economy estimates and actual mileage -- particularly for vehicles that use newer
technology, like electric-hybrid systems or turbochargers.
Consumer Reports, in a review of Ford Motor Co.'s 2013 Fusion sedan last week, questioned the fuel-economy
benefits of Ford's EcoBoost engines, saying that in its tests, vehicles equipped with the turbocharged motors
haven't delivered the promised fuel efficiency. The Fusion SE with a 1.6-liter EcoBoost engine achieved 25 miles
per gallon overall in its testing, below the EPA's rating of 28 mpg and below Consumer Reports' results for other
cars in its class, including the Honda Accord (30 mpg) and the Nissan Altima (31 mpg).
Ford says its own and third-party research indicates customers are satisfied with their EcoBoost vehicles.
For consumers, burned by bouts of $4-a-gallon gasoline, accurate mileage estimates are more important than
ever. Consulting firm Deloitte found in a 2012 survey of young consumer that nearly half are willing to pay as
much as $300 extra for every extra mile per gallon they believe they can get by buying a hybrid instead of a
conventional car.
Generally, auto makers charge a premium for gasoline or diesel vehicles that use technology such as
turbochargers or lighter-weight materials to get more miles out of a gallon. Ford charges about $2,600 more for a
2013 Ford Escape with a 1.6-liter, turbocharged "EcoBoost" engine, that gets two more miles per gallon on the
highway based on EPA tests, than an Escape with a standard, 2.5-liter four-cylinder engine. That is about $1,300
extra for each added highway mpg.
One problem regulators and car makers face is that the EPA estimates are generated in laboratories using
precise, repeatable formulas, while in the real world drivers report wide ranges of mileage for the same car.
Mike Young, 24, says he gets about 22 miles per gallon in the city and as much as 30 to 31 mpg on the highway
in his 2002 Nissan Altima V6. That is considerably better than the car's 17 city, 24 highway rating based on the
EPA testing protocols.
Mr. Young, who works in public relations in the Philadelphia area, says he drives "fairly fast" on the highway, but
tries to hold a constant speed. "I'm not one of those people who's on the gas and off the gas."
On the other end of the spectrum is Brent Wardle of Meridian, Idaho, who says he's planning to trade in his 2012
Hyundai Sonata hybrid because he's only averaging about 22 mpg in a car that in 2012 was rated by the EPA at
35 city, 40 mpg highway.
That mileage claim, he says, "is exactly why I bought it," passing up a more expensive Toyota Camry hybrid.
"Boy, was that a mistake."
Hyundai Motor Corp. has admitted it conducted mileage tests on many 2012 and 2013 models improperly. The
company has agreed to refund customers the difference in fuel costs implied by the gap between the old, inflated
ratings and new lower ones -- a one mpg difference in the Sonata Hybrid's case. Mr. Wardle says he's gotten just
$7.42 from Hyundai so far, an amount based on his average mileage and fuel prices. He says the money hasn't
exactly changed his mind about dumping the car.
The EPA invites vehicle owners to share their mileage on its fueleconomy.gov website. The reports of city and
highway fuel consumption logged by 15 owners of 2012 Sonata Hybrids average to 36.2 mpg -- 0.2 miles per
gallon above the official combined city/highway estimate.
For some other hybrids, the variation is greater. Fueleconomy.gov lists reports from 65 owners of the new Ford
C-Max hybrid, who have together averaged 39.1 miles per gallon in combined city and highway driving -- not the
47 mpg that Ford advertises based on the performance the car recorded in the five-part fuel-economy test
program required by the EPA. Among those drivers reporting, some achieved as much as 56 mpg, and others as
few as 28 mpg.
EPA officials are in the process of getting a C-Max to test themselves at the agency's fuel-economy laboratory in
Ann Arbor, Mich. They want to study the vehicle, in part, because it presents a new technology wrinkle that may
be flummoxing its long-standing tests. The car is designed to go as fast as 62 miles per hour using batteries
alone. The EPA's traditional highway test is conducted at an average speed of 48.3 miles per hour and a top
speed of 60.
The agency in 2008 added new tests designed to narrow the gap with real-world driving by simulating highway
speeds up to 80 mph, as well as driving in hot and cold weather. It is also considering conducting tests using
gasoline cut with 10% ethanol, like most commercially available fuel, instead of the pure gasoline prescribed now.
The 10% ethanol blends tend to drop mileage by 3% to 4%, the agency says.
A 2011 study by two Oak Ridge National Laboratory researchers concluded that the results of the EPA's 2008
testing system "tend to underestimate the real-world benefits of fuel economy."
Raj Nair, Ford's vice president for engineering, says Ford is confident that it has conducted the EPA tests properly
on all its vehicles. But especially with hybrids such as the C-Max, he says, variables such as temperature, a
driver's behavior and the engineering choices Ford makes to balance mileage and performance can make a big
difference.
Ford could design its throttle systems to deliver slower, steadier acceleration and get higher scores on the EPA
tests, Mr. Nair says. "We choose not to do that," he says, because Ford wants a car that is "fun to drive."
Rick Larrick, a professor at Duke University's Fuqua School of Business, says consumers would be better served
if the government and auto makers simply junked the miles-per-gallon measurement altogether.
Mr. Larrick says gallons consumed over 100 miles of driving -- the way mileage is measured in Europe -- is a
more useful yardstick because, ultimately, the variance in mpgs has less impact than most people think.
A car that gets 33 miles per gallon consumes 3 gallons per 100 miles. How much would you save by trading for a
car that gets 50 mpg? The answer: 1 gallon per 100 miles.
"You see these large differences in miles per gallon that don't make much difference," says Mr. Larrick.
Document J000000020130130e91u0000d

Ford extends profit streak despite big Europe loss
MONEY
Ford extends profit streak despite big Europe loss
James R Healey
443 words
30 January 2013
USAT
FINAL
B.2
English
Despite struggles in Europe, Ford Motor says its fourth-quarter profit was $1.7 billion before taxes, the most for
the fourth quarter in more than a decade. And it was Ford's 14th-consecutive profitable quarter.
That amounted to 31 cents a share, beating Wall Street forecasts, which ranged from 25 to 28 cents. Net
earnings after taxes were $1.24 billion.
Its European operation continues to bleed money, posting a quarterly loss of $732 million and full-year loss of
$1.73 billion. CFO Bob Shanks said Ford will lose $2 billion in Europe this year, but that should be the bottom as
models are introduced.
Ford forecast similar overall company results for this year: bigger losses in Europe, but higher earnings in North
America; break- even in South America and Asia-Pacific.
"This undercuts the popular investor thesis that Ford offers significant earnings expansion from a booming U.S.
auto market," auto industry analyst Brian Johnson of Barclays Capital said in a note to clients soon after Ford
executives discussed earnings on a conference call.
Ford shares fell 4.6% to $13.14.
Despite the European anchor, Ford said overall results were as good as in the days when trucks and SUVs,
generally high-profit models, were a more significant part of its sales. Though no longer dominant, truck and SUV
sales have picked up as the economy inches back, and Ford has been successful at selling versions of all its
vehicles with lots of options, earning bigger profits than lesser- equipped models do.
Ford "recorded the highest level of transaction prices for the company" with fewer incentives, notes analyst Jesse
Toprak at TrueCar.com. Ford's average transaction price in the U.S., he says, was $32,600, up from $31,751 a
year earlier. The average per- vehicle sales incentive cost Ford $2,691 last year, down from $2,940.
Ford did, however, lose 1.3 points of market share in the U.S., finishing the year at 15.2%.
For all of 2012, Ford's pretax earnings were $8 billion, and net income was $5.7 billion, down $307 million from a
year ago. Ford forecast pretax earnings about the same this year. Revenue last quarter was $36.5 billion, up $1.9
billion from a year earlier. For 2012, revenue was $134.3 billion, down $2 billion.
Ford said Tuesday that it will make profit-sharing payments averaging $8,300 on March 14 to about 45,800 U.S.
hourly workers as part of its contract with the UAW.
Document USAT000020130130e91u0000o

Corporate News: The Motor City Is Back in the Money --- Auto Firms Expect to Report Billions of Dollars in 2012 Profits, as Well as...
Corporate News: The Motor City Is Back in the Money --- Auto Firms Expect to Report Billions of Dollars
in 2012 Profits, as Well as Dividends, Profit-Sharing
790 words
29 January 2013
J
B4
English
DETROIT -- Three years after this city was wracked by bankruptcies, the Motor City is rolling in money.
In the weeks ahead, the Detroit Three auto makers are all preparing to report billions of dollars in profits for 2012.
Combined with 2011, when Ford Motor Co. earned $20.2 billion and General Motors Co. earned $9.2 billion, the
past 24 months will represent two of the strongest consecutive years for the companies in decades.
The rebound is extending beyond the companies themselves. Ford recently doubled its dividend to 40 cents a
year, giving shareholders a larger cut of the spoils. The company is also likely to give union workers profit-sharing
checks of more than $8,000 for 2012, based on its strong results in North America. Similarly, GM will send union
workers checks of about $7,000. Both companies have also hired thousands of new workers and committed to
add even more.
"This is what recovery looks like. This is what all the sacrifices were about three years ago," says Rebecca
Lindland, a senior analyst with IHS Automotive. "It's a completely different industry in Detroit."
Chrysler Group LLC, while not at the same level as Ford and GM, is still expected to produce a profit of more than
$1.5 billion. It is also hiring workers and paying out profit-sharing checks.
The question for all three companies is whether they have changed enough through restructuring to remain
profitable if the U.S. economy worsens. Right now, the three car makers derive nearly all of their profit from North
America.
Ford, GM and Chrysler face rising competition in the U.S., but more importantly, losses in Europe are sapping
their profits. China is a big source of GM's sales, but not its profit. Ford is investing billions of dollars in China, but
it isn't making money there, and Chrysler is hardly there at all.
Ford, which turned itself around without U.S. aid or a bankruptcy filing, reports earnings Tuesday. It is expected to
have another big result from North America, where its operations, buoyed by pickup-truck sales, provided a
record operating profit of $2.3 billion last quarter. The unit's fourth-period operating profit is expected to be lower
but still strong.
Joseph Spak, an automotive analyst with RBC Capital Markets, noted that if Ford North America were a
stand-alone, it would rank among the world's most profitable auto makers. He rates Ford stock a "buy."
Barclays analyst Brian Johnson is forecasting North America will carry Ford to 2012 net income of $5.5 billion, or
$1.37 a share. He expects Ford to earn $6.1 billion in 2013 on rising demand in the U.S.
The company's big problem now is executing its European restructuring plan, which calls for an 18% reduction in
capacity by closing three plants. Ford has forecast a $1.5 billion loss in the region for 2012 and 2013.
GM is facing similar problems in Europe, where the company posted a third-quarter loss of $361 million,
compared with operating profit of $102 million a year earlier. In October, GM said its European region could have
a loss of between $1.5 billion and $1.8 billion for 2012, depending on the level of restructuring in the fourth
quarter. For 2011 it had a $747 million loss. The region isn't expected to return to break even on an operating
basis until mid-decade.

FactSet estimates GM will earn 52 cents a share for the fourth quarter, compared with 40 cents a share a year
earlier.
GM announced last week that it's considering closing its Adam Opel unit's Bochum, Germany, plant nearly two
years earlier than planned if an agreement on new cost-saving steps can't be reached with the union.
In spite of all of Europe's woes, GM expects its pretax profits to rise modestly this year, helped in part by strength
in the U.S. and China.
Chrysler, which is majority owned by Fiat SpA, earned $1.29 billion through the first three quarters and said it
would achieve a profit of at least $1.5 billion for the year. The company isn't publicly traded. Chrysler, which
operates mostly in North America, has steadily improved sales and margins. But it isn't yet benefiting enough
from sharing technology with Fiat to match GM and Ford in performance.
Document J000000020130129e91t0002m

Toyota Takes Sales Crown
Toyota Takes Sales Crown

By Chester Dawson
580 words
29 January 2013
J
B1
English
TOKYO -- Toyota Motor Corp. reclaimed the title of world's largest auto maker in 2012 from General Motors Co.,
rebounding from an earthquake that damaged its factories and embarrassing recalls that dinged its reputation.
Toyota sold 9.75 million vehicles last year, compared with 9.29 million for GM. Toyota was boosted by a 27%
sales increase in the U.S., following a down year in 2011 when a powerful earthquake in Japan disrupted
production and caused a shortage of vehicles.
Toyota and its Japanese rivals came back in 2012 with full production and higher discounts in a bid to gain
market share. In many cases, Toyota increased sales incentives by trimming the cut of profit that previously went
to dealers, owners of Toyota franchises said. Some Toyota dealers saw their new-car sales jump 25%, but had
no increase in profit compared with 2011, these owners said.
The strategy powered Toyota's U.S. sales back to prerecession levels. In 2012, the company sold 2.1 million cars
in the U.S. market, an increase of nearly half a million cars. It was Toyota's best year in the U.S. since 2008.
Likewise, Honda's U.S. sales rose 24% in 2012 to 1.4 million cars and light trucks, an increase of 275,500. Honda
also boosted incentives, both to regain the market share it lost and to prop up sales of its redesigned Civic
compact, which the company acknowledged didn't measure up to competing vehicles. It has since overhauled the
car.
GM and Ford Motor Co., meanwhile, held back on incentives. Their U.S. sales rose just 3.7% and 4.7%,
respectively, in 2012. Ford is slated to report its latest results on Tuesday.
Toyota, whose sales volume includes minicar maker Daihatsu Motor Co. and truck maker Hino Motors Ltd.,
bounced back amid demand for its Prius hybrids, sedans like the Camry and sport-utility vehicles such as the
Lexus RX 350.
Toyota first became No. 1 in 2008 and held the position for three years. GM held the top spot for almost eight
decades before being dethroned. GM, which emerged in 2009 from government-backed bankruptcy, has said it is
no longer focused on being the world's biggest.
Recent sales gains, coupled with a sharp weakening of the yen against the dollar, may bode well for the profit
picture at Japan's auto makers. A weaker yen increases the value of dollar-denominated sales overseas and
makes Japanese exports more competitive abroad.
This year, Toyota has forecast sales of 9.91 million vehicles on expectations for more modest growth now that it
has caught up on a backlog of orders from 2011. It also reflects continued difficulties for it and Japan's other auto
makers in China, the world's largest auto market.
Sales of Japanese brands plummeted from mid-September last year amid mounting political tensions between
Beijing and Tokyo. While Japan's auto makers say demand has begun to recover, the spat has been a major
setback in efforts to match U.S. and European rivals with greater market share in China.
Toyota didn't provide a breakdown by country Monday, but it previously said it wouldn't likely meet a 2012 goal of
selling one million cars in China.
---

Neal Boudette contributed to this article.
Document J000000020130129e91t0002l

Corporate Watch
Corporate Watch
683 words
29 January 2013
J
B7
English
HOSTESS BRANDS
Bids Lined Up for Drake's,
Four Bread Brands
Hostess Brands Inc. has lined up two sale deals totaling $56.35 million, with one kicking off a bankruptcy auction
for the company's Drake's cakes brand and another setting a floor price for a group of bread brands.
United States Bakery Inc., a Portland, Ore., company also known as Franz Family Bakery, is offering $28.85
million for the bread assets, which include the Sweetheart, Eddy's, Standish Farms and Grandma Emilies bread
brands. McKee Food Corp., the Collegedale, Tenn., maker of Little Debbie snack cakes, has submitted a $27.5
million bid for the Drake's brand, which made treats like Devil Dogs, Ring Dings and Yodels before Hostess
began liquidating in bankruptcy.
Drake's Wayne, N.J., plant -- the only kosher bakery plant in the U.S., according to a Hostess investment banker
-- isn't included in the McKee offer; the company is bidding only on the brand and some equipment. Franz,
however, has agreed to buy four bakeries, 14 depots and equipment, in addition to the bread brands.
-- Rachel Feintzeig
---
HESS
Last Refinery to Close,
Terminals for Sale
Hess Corp.'s Port Reading, N.J., refinery -- the company's first and last such facility -- will close its doors at the
end of next month as the company gets out of the refining business to focus on more-profitable exploration and
production activity.
The company also said it is seeking to sell its U.S. terminal network. Chairman and Chief Executive John Hess
said the moves "will complete (the company's) transformation from an integrated oil-and-gas company to one that
is predominantly an exploration-and-production company and be able to redeploy substantial additional capital to
fund its future growth opportunities."
The decision comes amid similar moves by integrated oil companies to streamline their operations and divorce
the often highly profitable work of exploring for and extracting oil and gas from the lower margin businesses of
refining it into fuel and selling it.
Its shares were up 6.1% at $62.48 in 4 p.m. composite trading on the New York Stock Exchange.
-- Tess Stynes and Alison Sider
---
AUTO INDUSTRY

Companies to Cooperate
On Fuel-Cell Systems
The alliance between Renault SA and Nissan Motor Co. will work with Ford Motor Co. and Daimler AG to share
the cost of developing fuel-cell vehicle systems that could feature in road cars as early as 2017, the auto makers
said on Monday.
The investment will be shared equally between the three entities, though no figures were provided in a joint
statement.
Car makers are racing to develop fuel-cell technology and bring their cars to market to comply with ever-stricter
emissions regulations. Fuel-cell electric vehicles produce electricity from hydrogen and oxygen and are
emissions-free, with the only byproduct being water vapor.
-- David Pearson
---
LODGENET
Hotel Media Company
Files for Bankruptcy
Hotel media provider LodgeNet Interactive Corp. filed for Chapter 11 bankruptcy to execute an agreement with
private-equity firm Colony Capital LLC that will infuse $60 million into the business in exchange for control of the
company.
LodgeNet said it plans to complete the restructuring within 60 days. The company, which provides cable
television to hotels and health-care businesses, said that it has been seeing declining revenues since 2009 as
fewer hotels used its services -- 1.5 million currently, down from two million in 2009, and guests ordered fewer
pay-per-view movies.
As part of the restructuring, LodgeNet also negotiated a new partnership with DirecTV, whereby DirecTV will
support the restructuring and will assume some installation costs so that LodgeNet can continue to provide
DirecTV cable to its customers.
LodgeNet, in documents filed with the U.S. Bankruptcy Court in Manhattan, said the deal will allow it to repay
unsecured creditors in full. Secured creditors will a share of a $346.4 million payment, a 99% recovery.
-- Stephanie Gleason and Melodie Warner
Document J000000020130129e91t0002k

Ahead of the Tape
Ahead of the Tape

Ahead of the Tape
By Spencer Jakab
442 words
29 January 2013
J
C1
English
Ford Could Be Slowed by Global Potholes
"Closed airspace, pro pilot. Seriously, cars can't fly."
The fine print at the bottom of Ford Motor Co.'s recent TV commercial, in which a car soars off a cliff, pokes some
fun at the disclaimers car companies attach to their ads these days. The model in question, the sleek new Ford
Fusion, almost looks airworthy -- along with Ford's share price. Despite rising 53% already over the past six
months, it still trades at a 38% discount to the S&P 500 on estimated 2012 earnings and Ford just doubled its
dividend.
Trouble is, just as lawyers have to play the role of killjoy, analysts do, too. In the past year, their forecasts for
2012 and 2013 earnings have slipped by 11% and 16%, respectively. Tuesday's full-year results for Ford are
seen falling to $1.51 a share, from $1.91 a year earlier, excluding special items.
The turnaround story at the only major U.S. auto manufacturer to avoid bankruptcy is inspirational. Its home
market continues to expand briskly. Ford's automotive net cash position is nearly $10 billion, a $20 billion
improvement from late 2008. Overall U.S. light vehicles sales in 2012 were 14.4 million, toward the higher end of
what Ford projected, and it expects 15.3 million in 2013. And pickup trucks, a niche it dominates, are expected to
do especially well as home construction rebounds. Finally, its "One Ford" plan to build cars more efficiently on
globally shared platforms is progressing nicely.
It is global markets that aren't cooperating. European car sales fell 8.2% last year and are seen dropping another
5% in 2013, according to the European Automobile Manufacturers' Association. Meanwhile, Ford's share in the
region slipped last year. Ford's position also worsened slightly in still-growing Asia and South America. It even
dropped from 16.5% to 15.2% at home, though that is more a reflection of Japanese auto makers recovering from
2011's earthquake.
None of this is especially worrying, but it calls into question the market's recent love affair with the stock. Analysts
at Barclays point out that, on prospective cash-flow measures, Ford now trades at a moderate premium to its
10-year average. However encouraging the recovery of its home market has been, Ford is weighed down by
much of the same baggage as its peers.
Seriously, global auto makers can't fly.

Document J000000020130129e91t0000o

Start-ups give new life to empty auto plants ; Entrepreneurs see potential
MONEY
Start-ups give new life to empty auto plants ; Entrepreneurs see potential
Chris Woodyard
1,539 words
29 January 2013
USAT
FINAL
B.1
English
A stroll around the factory floor here reveals the kind of assorted automotive projects that fire imaginations.
Classic Fords and Chevrolets under restoration are parked in neat rows, including a Mustang customized for the
ill-fated revival of the Knight Rider television series and another that's a custom prototype for the Chinese market.
A 2014 Chevrolet Silverado pickup, yet to appear in showrooms, waits to be prepped for auto show display.
So far, two small auto companies share the cavernous space in the former auto plant in this Detroit suburb.
Working together as Automotive Performance Industries, they're hunting for at least a couple more entrepreneurs
who can join up to follow the same model - - working on their own projects or as a team.
The rebirth of a former car factory as a business incubator for small start-ups aiming to make it big someday
points to a hopeful trend in the auto industry. More of the old factories left behind by the cutbacks of Detroit's Big
3 automakers during the recession are becoming homes to myriad new businesses. Sometimes the sites stay
devoted to automotive uses, but other businesses have swooped in as well -- from herb growers to
shopping-center developers. They are creating jobs that can begin to replace some of the thousands lost when
General Motors, Ford Motor and Chrysler cut back over the past decade.
"There is a lot of activity. Capital markets are flowing again, and there is a demand for space," says Bruce
Rasher, redevelopment manager for the Racer Trust, created by the U.S. Bankruptcy Court in 2011 to find buyers
for General Motors' shuttered facilities. "It's an excellent way to diversify employment."
In some cases, the new tenants for old automotive plants are leading the way to a new kind of auto industry.
Tesla Motors, maker of the $61,070 all-electric Model S sedan, has set up shop in the former GM-Toyota joint
venture plant in Fremont, Calif., that once churned out Corollas and Geo Prizms. Fisker Automotive, maker of
plug-in hybrid sedans, hopes to start production of its next model in a former GM plant in Wilmington, Del.
And earlier this month, another start-up, Elio Motors, announced that beginning next year it will build its $6,800,
84-miles-per- gallon economy cars at the former GM plant in Shreveport, La., that once built the Hummer. "It
works out well for everyone," says founder Paul Elio of the real estate deal.
In other cases, different kinds of businesses are coming on board. Florida-based grower Sunfest Organic Herbs is
taking over a former GM metal-stamping plant in Ontario, Ohio. Developers are seeking other tenants for what is
now being called Ontario Business Park. Though it will demolish many of the buildings, Sunfest plans to create up
to 150 jobs in an expansion that will put it closer to its customers.
It's not easy
Yet for all the attractiveness of the notion of entrepreneurs setting up shop amid the ruins of an evolving auto
industry, it hasn't been easy. The auto plants are often dated, with low ceilings that don't accommodate today's
high-tech manufacturing methods or other uses, such as warehousing. Also, the facilities have, in some cases,
required extensive environmental cleanups.
For Automotive Performance Industries, or API, here in Troy, the plant was tailor-made for auto-related
businesses. It had been home to Saleen Performance, the specialty vehicles customizer and maker founded by

racer Steve Saleen, who has since gone on to a new auto venture. A building is a building, but what made the
place special was its paint booths, which used a special higher-heat system to paint luxury cars.
Saleen, in its role as a contract builder and backed by Ford, had invested millions in the plant to help build and
paint Ford GT supercars to exacting standards. Once the building was empty around 2009, it attracted business
partners S.A. "Tony" Johnson and Karl Storrie, who had long worked together as auto-parts suppliers and on
other deals. "We bought a paint system, and there happened to be a building around it," Storrie says.
It was the kind of equipment that would be out of reach of most small businesses that specialize in customizing or
small-batch manufacturing.
Bryan Chambers saw the possibilities. He had been a manager at the plant when it was under Saleen, and
created his own business, Alternative Automotive Technologies, after the factory closed. At first, he was living
"check to check," but he soon saw how the old building could become a great place to make smaller batches of
custom vehicles. In addition, he prepares concept vehicles for public display and takes on individual jobs, such as
adding superchargers to further soup-up performance cars.
Chambers was later joined by George Huisman, founder of Classic Design Concepts, which specializes in
aftermarket parts, such as custom grilles and rear trim panels for Mustangs. He is working on a project to convert
Mercedes-Benz Sprinter vans into disaster-relief vehicles for the American Red Cross.
While they do their own jobs, they find room to collaborate. Huisman points to a Mustang being customized for
Chinese automotive enthusiasts that could provide work to both companies. It's called the RTR Mustang, for
"ready to rock."
So far, there are only about 30 employees at work at API. Much of the building, larger than three football fields, is
unoccupied. The goal is to bring in at least a couple of other companies, putting them under the API umbrella.
"We're not interested in renting space. We're interested in business partners," Storrie says.
API should be relatively easy to fill. The bigger challenge comes with the Big 3's former auto plants, which
measure square feet in the millions. Tesla, for instance, is using only a relatively small portion of its Fremont,
Calif., factory even as its production of the Model S all-electric plug-in sedan continues to ramp up.
When Ford closed its assembly plant in Atlanta, which used to make the old versions of the Taurus, Porsche took
a portion and the rest is being divided up for light manufacturing or warehousing, says Jay Gardner, director of
real estate for Ford Land, which is taking care of the automaker's former plants.
Ford has been trying to find a buyer for its now-closed plant in Wixom, Mich. But 4 million square feet, much of it
built when it opened in the 1950s, spread over 317 acres is more than most manufacturers could ever handle.
(Ford did sell a portion of the plant.)
Ford, which has sold nine plant sites since 2006, has had some other notable successes. A dump near Allen
Park, Mich., was capped and the ground allowed to settle; then it eventually became a shopping center, Gardner
says. That creates more jobs than the usual use of former dumps -- turning them into open space or golf courses.
Lots of interest
The Racer Trust, which says it has completed 24 sales out of 89 facilities in 14 states, just wrapped up its deal
with Elio, maker of the novel three-wheel commuter car. "We're very encouraged by the level of interest in the
properties," says Rasher, a former mayor of Marshall, Mich., who says communities are consulted about the uses
they would like to see for the former plants.
Entrepreneur Elio sounds thrilled to have gotten a turn-key auto plant on the cheap. (Just how cheap, he won't
say.)
"The assets are worth more if you use them for their intended purpose," he says. GM had a peak workforce of
3,200 at its Shreveport plant, Elio estimated. He says he guaranteed Racer Trust that he would employ 1,500
eventually, and he plans to tap the pool of veteran autoworkers still in town.
Back at API, workers are relishing the start-up feel inside the business incubator -- and the opportunity to
collaborate with other companies.
Paul Elizando, 34, who works on the paint line, sees the possibilities of working with others in companies that are
part of API: "You can cast a wider net and help everybody."
Over in the modeling shop, working in the small operation is a big change for 34-year GM veteran Dan
Bommarito. But he says he likes it.
"It's a little more one-on-one, and you don't have all the red tape," Bommarito, 57, says between projects. "It's
easier on everyone."
He is teamed with a relative newcomer, Kevin Ryszka. "Everything is really exciting," says Ryszka, 40. "Nothing is
done by an individual anymore. It's a team. If you can bring that expertise under one roof, how can it be a bad
thing?"
Contributing: Lou Whitmire, Mansfield (Ohio) News-Journal
photo Photos by Eric Seals, Detroit Free Press Dustin Edmunson, above and below, works on customizing a car
in an old auto plant in Troy, Mich., that serves as home to Alternative Automotive Technologies and Classic
Design Concepts.
Document USAT000020130129e91t0000w

EARNINGS SEASON ; RESULTS STILL UPBEAT
MONEY
EARNINGS SEASON ; RESULTS STILL UPBEAT
242 words
28 January 2013
USAT
FINAL
B.1
English
With quarterly earnings results now in for more than a quarter of S&P 500 companies, almost two-thirds have
reported earnings per share and revenues that beat analysts' average forecasts, FactSet reports. Six companies
in the Dow Jones industrial average and 104 S&P 500 companies will report earnings this week. Among them:
today, Caterpillar and Yahoo; Tuesday, Amazon, Chrysler and Ford Motor; Wednesday, Boeing and Facebook;
Thursday, Aetna; Friday, Chevron and ExxonMobil.
ECON REPORTS THIS WEEK
This will be a big week for economic reports, starting today, with durable goods orders for December, and ending
Friday, with the government's closely followed monthly employment report for January. The Federal Reserve's
policymaking committee will have a statement at the conclusion of its two-day meeting on Wednesday. Also
scheduled: Tuesday, consumer confidence for January and Case- Shiller's index of home prices for November;
Wednesday, the government's first estimate of gross domestic product in the fourth quarter and the ADP private
employer jobs report.
BANKRUPTCY UPDATE
WHO LOVES DRAKE'S?
The possible next owner of Drake's Cakes is expected to be revealed this week when bankrupt Hostess Brands
reports who has bid for one of its famous product lines. Drake's includes Devil Dogs, Funny Bones and Yodels.
The fate of Twinkies is still being negotiated as Hostess unwinds its business in bankruptcy court.
photo Hostess From Drake's Cakes.

Document USAT000020130128e91s0002z

Any Engine You Like, But Only if It's a Hybrid
BEHIND THE WHEEL | 2013 FORD C-MAX

Automobiles; SECTAU
Any Engine You Like, But Only if It's a Hybrid
By BRADLEY BERMAN
1,611 words
27 January 2013
The New York Times
NYTF
1
English
BERKELEY, CALIF. -- For many Americans, the basic compact car stands as a matter of sacrifice -- to financial
constraints, to fuel economy demands, to the exigencies of urban crowding. But what if the design of small cars
could be reformulated to transcend their size?
For an answer, Ford Motor looked to Europe, where small cars, like small apartments and un-Gulplike beverage
servings, are accepted realities of life. The company found a solution in its C-Max, a five-seat people mover it has
sold in Europe since 2002 but began offering in the United States only last fall.
Ford made a bet that American drivers would get used to, and even come to like, the high-roof design of the
C-Max. Its tall proportions create a spacious interior in a small format -- a layout common on the other side of the
Atlantic but one that has struggled for acceptance in this market.
Then, one might say, Ford went ''all California'' and remade the American-market C-Max into the company's first
exclusively hybrid model. There is no gasoline-only C-Max offered in the United States, only hybrids: a standard
gas-electric C-Max Hybrid and a plug-in version, called the C-Max Energi, that can recharge from the power grid.
Though it shares its basic dimensions with a Ford sibling, the Focus, the C-Max is more spacious and
comfortable; tall passengers gape in amazement at its generous headroom.
That was the experience of Jim Hough, a 6-foot-4, 250-pound Navy veteran who leased a C-Max Hybrid in
October. Mr. Hough, from San Jose, Calif., considered his 2007 Ford Taurus ''too confining'' but appreciates the
accommodations of his new car. ''I can open the door of the C-Max and simply get in it like I'm in my living room
chair,'' he said.
The C-Max is bigger and bulkier than a compact -- the Energi plug-in, with its larger battery, weighs a substantial
3,900 pounds -- but is smaller than a crossover. The doors feel exceptionally heavy and solid for a car this size,
closing with a thud. Visibility is excellent, and the horn is a loud baritone.
Though the car's space-maximizing proportions may be more functional than typical compacts, they don't stir
strong emotions. Still, the C-Max is pleasing enough to the eye, even if it is seems slightly large for its frame, like
an attractive person who is described as big-boned. The dashboard layout, as on many other Ford vehicles, is a
mishmash of levels, bevels and angles.
The C-Max's road manners bear little resemblance to the way typical gas-electric models respond. The Hybrid's
188 total horsepower (the combined output of the 2-liter 4-cylinder gas engine and a 118-horsepower electric
motor) reveals itself in a guttural roar during highway passing, the only time I could detect the presence of a
combustion engine. Ford engineers have perfected the art of hybrid smoothness.
The downside of the C-Max not driving like a hybrid is that its fuel economy can also be unlike a hybrid. In the
week I spent with the C-Max Hybrid, followed by a week with the C-Max Energi plug-in, the gas mileage varied
wildly.

In my first 175 miles with the C-Max Hybrid, I managed only 35.9 miles per gallon. That's shamefully below the
E.P.A. rating of 47 m.p.g. for both highway and city driving, something noted by reviewers and owners (and has
resulted in a class-action suit against Ford in California).
But then, on two occasions I used only a single gallon of gasoline to complete a 50-mile highway trip, handily
beating the E.P.A.'s estimate. Mr. Hough said his mileage averaged in the low 40s.
Consumers who want a more certain leap in mileage should consider the C-Max Energi, which went on sale in
October. For the Energi -- Ford's tag for plug-in models, also applied to a coming version of the Fusion sedan --
the 1.4 kilowatt-hour lithium-ion battery pack used in the Hybrid is swapped for one with a 7.6 kilowatt-hour
capacity that is recharged from the grid.
The larger pack can be replenished in less than two-and-a-half hours through a 240-volt outlet, enough for about
20 miles of all-electric range. Total output for the Energi plug-in rises to 195 horsepower because of the larger
battery pack's greater ability to deliver electricity to the motor. Otherwise, the gas engine and continuously
variable transmission are identical to those used in the C-Max Hybrid. The E.P.A. combined mileage rating for the
C-Max Energi is 100 m.p.g.e., or miles per gallon equivalent.
It was fascinating to see how long after a full charge I could maintain the maximum 999 m.p.g. reading on the
dashboard. That startling number -- a misleading way of showing that no gas was being consumed -- usually
lasted about 17 miles. Then, with the gas engine starting, the number would drop to 400, 300, 200 and lower.
Ford provides three modes to the C-Max Energi driver, aptly named EV Now, EV Later and EV Auto. The choices
are refreshingly straightforward (unlike the car's maddening Sync interface for infotainment systems), and, I think,
would logically become a standard way of offering multiple modes in plug-in hybrids.
Think of the Energi's 7.6-kilowatt-hour battery pack and its 14-gallon gas tank as two separate, interchangeable
sources of energy. In the EV Now mode, the car uses only electricity as long as the battery pack has remaining
charge and you drive at highway speeds. By choosing EV Later, the driver elects to only use gasoline, reserving
the electricity for a different time; with EV Auto, efficiency-minded sprites in the car's software make the decisions.
One of my days with the C-Max Energi required 24 miles of travel, of which 21.6 miles were battery-powered,
using 6 kilowatt-hours of electricity.
For a 59-mile journey from Berkeley to the San Francisco airport and back -- three times what the battery pack
can deliver for electric-only propulsion -- I returned home with a reading of 67.7 m.p.g. That number takes into
account the initial miles on battery power and the gas used once the Energi's battery was depleted.
At that point, the C-Max Energi provided the same fuel economy as the C-Max Hybrid -- about 40 m.p.g. around
the city and close to 50 m.p.g. on the highway -- despite being some 260 pounds heavier.
But keep in mind that if most driving is within the Energi's 20-mile real-world E.V. range, as it was for me, the
C-Max would effectively serve as an electric vehicle.
With the Energi's plug-in benefits come compromises, however. First, the copious cargo room that is among the
C-Max's best features is seriously reduced to make room for a larger, awkwardly placed battery pack that is about
the size of a large suitcase. With the rear seats folded flat, the cargo capacity drops to 42.8 cubic feet in the
C-Max Energi, from 52.6 cubic feet of cargo for the C-Max Hybrid.
Moreover, in its battery-only mode the C-Max Energi is short about 70 horsepower that would normally come from
the gas engine. It is still smooth, fairly quick and incredibly quiet, but not as much fun to drive as a Nissan Leaf
and certainly not in the same league as a Tesla Model S.
Despite its higher base price, the buyer's cost to acquire a C-Max Energi may prove to be lower than it would be
for a C-Max Hybrid when federal and state incentives are considered. The basic C-Max Hybrid SE starts at
$25,995. A loaded Hybrid SEL with features like premium audio and heated seats tops $30,000.
By comparison, my Energi SEL test car carried a window sticker of $36,635. The C-Max Energi plug-in hybrid has
a base price of $33,745. Subtract a federal tax credit of $3,750 and the price drops to $29,995. California buyers
qualify for a $1,500 cash rebate, reducing the price of the Energi in that state to $500 below the Hybrid SEL.
Why would anybody, except those who can't stretch beyond the barest C-Max Hybrid trim, or are unable to live
with 10 fewer cubic feet of cargo space, not opt for the plug-in Energi? For those who can splurge, I'd recommend
the option package with Active Park Assist , just to experience this ''look ma, no hands'' feature.
Regardless of whether the fuel economy is simply good or truly outstanding, car buyers will be hard pressed to
find as much efficiency, utility and innovative technology in a package as small and affordable as the C-Max
models.
INSIDE TRACK: Driving small, living large.
(AU1); The Ford C-Max comes in two flavors: a plug-in version, called the C-Max Energi, and a standard
gas-electric C-Max Hybrid. A plain vanilla gasoline-only version is not on the menu. The interior, far left, is
spacious because of the car's tall proportions. (PHOTOGRAPHS BY FORD MOTOR) (AU7)
Document NYTF000020130127e91r0003l

Cross Country: The Motor City Roars Out of Washington's Shadow
Cross Country: The Motor City Roars Out of Washington's Shadow

By Henry Payne
1,098 words
26 January 2013
J
A15
English
Detroit -- The 2013 North American International Auto Show here in the nation's auto capital is proof that the
industry is back at full throttle. Cobo Hall convention center is filled with manufacturers catering to every corner of
a diverse consumer market. Automotive forecasting firm R.L. Polk & Co. predicts new vehicle registrations -- a
key indicator of auto sales -- will hit 15.3 million in 2013, up 6.6% from 2012.
From sport utes to sports cars to soccer-mom vans, every industry segment is thriving -- with the notable
exception of the alternative-fuel vehicles into which Washington has sunk billions of taxpayer dollars.
Under the administrations of George W. Bush and Barack Obama, the federal government has tried to reinvent
the automobile with ethanol and battery power. But the market is proving that industry -- not Washington and its
central planners -- knows its customers best.
Predicting a breakthrough in switchgrass-based ethanol technology in 2007, the Bush administration mandated
that cellulosic, or plant-cell based, ethanol production for American autos increase to 500 million gallons by 2012
and a staggering 16 billion by 2022. Washington then subsidized its fledgling industry with $1.5 billion in federal
grants and tax credits. Prodded by Washington, General Motors used the 2008 auto show to announce
investments in cellulosic ethanol companies and flex-fuel vehicles, and a national campaign to add E85 (a blend
of 85% ethanol and 15% gasoline) pumps at gas stations.
Five years later and the ethanol market is a bust. Fewer than eight million gallons of cellulosic ethanol were
produced in 2012, E85 pumps are rare (most blends are 10% or 15%), and ethanol is rarely mentioned at the
auto show.
The electric revolution is muted too. Spending an estimated $10 billion of the 2009 federal stimulus bill on battery
power, Team Obama predicted a million electric cars on the road by 2015. Today there are barely 30,000, and
federally subsidized auto-battery suppliers like Ener1, A123 Systems and LGChem are either struggling or
bankrupt.
The reason is simple: Battery-power is proving to be a small niche player. The electric Nissan Leaf -- which
received a $1.4 billion Washington loan in 2010 -- saw a 22% increase in sales over 2011, half what was
expected. "It was a disappointment for us," Nissan CEO Carlos Ghosn said here last week.
Poor sales have dogged the electric Ford Focus, Chevy Volt and Fisker Karma as well. A $7,500 federal tax
subsidy to electric-car buyers has done little to boost the market, even as it subsidizes One Percenters like Leo
DiCaprio and Justin Bieber, who both own $100,000 electric Karmas; and Michigan Sen. Carl Levin, owner of a
$40,000 Chevy Volt.
In an ironic twist, one of the showstoppers is the VL Destino, which strips the Karma of its electric drive-train and
inserts a fire-breathing, 638-horsepower Corvette ZR-1 gas engine in its place. The result? A lighter, more
competitive, four-door sports sedan. Its designer? Bob Lutz, the former GM vice chairman and old-school "car
guy" who brought the struggling Volt to market.
Meanwhile, auto makers are proving there's still plenty of potential in the gas-powered engine to meet customer's
fuel-efficiency demands. The average U.S. gas price in 2012 hit a record $3.62 a gallon, putting mpg higher on
buyers' shopping lists. They are finding their answers in familiar, affordable places.

Auto engineers know you don't have to reinvent the wheel to get better gas mileage. Take the Chevy Cruze. At
half the price of its celebrity sister Chevy Volt plug-in (built on the same platform), the $20,000 Cruze Eco gets 42
mpg on the highway with a 1.4 liter turbocharged gas engine and aerodynamics innovation. The best-selling Ford
F-150 pick-up, meanwhile, has boosted fuel economy by an impressive 20% with its turbocharged V-6 engine --
without sacrificing any of the truck's stump-pulling macho.
But the scars of the Washington bailout linger. Powerless to resist new EPA regulations while two Detroit
companies were owned by the government, the industry knuckled under to government mandates forcing 35.5
mpg average fuel economy by 2016 and 54.5 mpg by 2025. Drafted in 2011, these regulations are from an
alternate universe, as a quick look around the show floor testifies. Just two non-electric vehicles (the Smart and
Scion iQ) average over 35 mpg, while the average fuel economy of cars sold in 2012 averaged just 23.1 mpg,
according to industry analyst TrueCar.
Where once manufacturers could boost their fleet average mpg by adding a couple of fuel-sippers to their lineup,
now every vehicle must meet a government target. Says a Detroit company spokesman, "The industry is
struggling to meet this standard," which Washington itself estimates will set back the industry $135 billion in
compliance costs.
Meanwhile, the engineers and product managers have products to sell. While the Obama administration dreams
of Americans in Euro-style tin cans, American customers like elbow room, and this year's show marks a return to
the American truck wars. No better example of that is Fiat, the Italian auto maker that came to the rescue of
Chrysler in 2009 when it emerged from bankruptcy. Washington had hoped Fiat would give Chrysler religion on
compacts, but instead it has been converted to American SUV and truck worship.
While Chrysler sold 43,000 tiny Fiat 500s in 2012, it sold over 470,000 Jeeps, vaulting the iconic brand to No. 1 in
the SUV market. More than any other vehicle, the Jeep Grand Cherokee has saved the company, leading
Chrysler to the largest sales gain of any manufacturer in 2012. So popular are Jeep SUVs that Fiat CEO Sergio
Marchionne has gone from Washington-appointed missionary to U.S. market student. Trucks and SUVS, the
Italian CEO has learned, are where the bucks are, and he has made plans for more Fiat-brand models --
including a sleek Maserati SUV built right in Detroit on a Jeep platform.
The 2013 show, which ends Sunday, puts greenbacks first and green second. This year there are fewer
politician-pleasing green concepts and more consumer-pleasing must-haves. For continued industry success,
Washington would do well to keep its distance.
---
Mr. Payne is an editorial writer and political cartoonist for the Detroit News.
Document J000000020130126e91q0001m

OFF DUTY --- Gear & Gadgets -- Rumble Seat: Ford Fusion: Passion Seizes the Family Sedan
OFF DUTY --- Gear & Gadgets -- Rumble Seat: Ford Fusion: Passion Seizes the Family Sedan
By Dan Neil
1,393 words
26 January 2013
J
D12
English
Out of all Ford's trout-mouthed wonder cars, the expectations are highest for the Fusion, the company's freshly
redesigned C/D sedan, a segment that in the U.S. represents more than one million annual sales (Honda Accord,
Toyota Camry, Hyundai Sonata, Volkswagen Passat, etc.). Careers break upon such rocks. Engineers jump off
buildings.
Auto makers devote themselves to a family sedan redesign with special zeal because getting it wrong means
losing a generation of buyers, as well Ford knows. Dearborn has raised the stakes for itself further because the
Fusion -- built on the CD4 global platform -- represents the current best practices of the "One Ford" strategy, an
effort to contain costs by building essentially the same vehicle for all global markets. According to Ford, the
Fusion has 80% global parts commonality (Europhiles may prefer to think of it as buying four-fifths of a Mondeo).
A miscue on the Fusion would reverberate through the product line for years to come.
Good thing it's so awesome.
It's received wisdom that an auto maker's "halo" car -- the car that builds the brand -- is its flagship sports car, like
Chrysler's Viper or Porsche's 918 Spyder. But the full measure of a company, I think, is found in these
mass-market offerings, the dronish millions ginned up in global assembly halls sadly lacking in lore or romance.
The regressive pressures on such products are enormous. Any family sedan that emerges from this process
retaining some spark of lust, some allure, is a kind of industrial miracle.
And that brings us back to the Fusion, which I judge to be, now, the best car in the segment: best-looking,
best-screwed-together, most likely to appeal to grown-ups. Look, it's no Maserati -- nor, despite eyewitness
reports, an Aston Martin -- but the Fusion is the rare family car that can ignite any kind of sustained desire. Heavy
industry rarely comes with quite so much lyricism and shrewd aesthetic judgment.
Why so great? First of all, plainly, it's a fine-looking automobile, with an athletic stature, an easy modernity and
innate handsomeness that makes the Accord and Sonata seem fey*. The cab-rearward proportions and raked
roofline nearly dispense with the deck-lid altogether. With the Fusion and the similarly silhouetted Kia Optima, we
are entering an era of well-packaged fastback sedans, which I welcome.
Second, the Fusion is technically ambitious, with a suite of powertrain options from a base 2.5-liter four to a fairly
radical plug-in hybrid powertrain (188 system horsepower with a 7.2-kilowatt-hour lithium-ion battery pack). Also
in the mix are a six-speed manual transmission (rare in the sedan segment); optional all-wheel drive; a
conventional hybrid system with a best-in-class EPA rating of 47 mpg; and a huffy 2.0-liter turbo/direct four with
240 hp and 270 pound-feet of torque. This is very postgraduate sausage making.
Third, the Fusion's cockpit design finally brings some order, some architectural sobriety to what is becoming an
increasingly cluttered and randomized space. The segment's worst offender is the Honda Accord, whose cockpit
presents the driver with disconnected islands of audio, climate and navigation information accessed through a
rotary-quadrant controller, steering-wheel switches and (redundantly) a touch screen, with some twist knobs
thrown in for good measure. It's a madhouse.
As compared with the Ford's cockpit, which organizes most vehicle functions into a sleek, sloped, matte-finish
center stack -- a "floating panel" with storage space underneath, between the footwells -- and rotary controller in
the center, below an 8-inch touch screen. Logical and legible, toggle-through animation -- conveying mileage, trip,
vehicle status and engine RPM -- plays out on two LCD screens that flank the central analog speedo. Ford Sync's

touch-screen graphics are still damnably small and easy to miss, but compared with its rivals, the Fusion is a
marvel of human-factors engineering.
As a matter of further inquiry: Why, in the age of "Brave" and "Avatar," are automotive display graphics so dreary,
low-res and childish, like the animation on old slot machines? The Fusion's display graphics are serviceable, sure,
but artless. Car makers have to start offering graphical "skins" to a car's infotainment and readouts. I'd like all my
displays in Old Norse.
Now, about that asterisk: Much has been made of the car's, let's call it, homage to Aston Martin, especially in the
grille design, and I wish I could shed light on the matter. How, exactly, was it decided that Ford Global Design
would plagiarize Aston Martin so brazenly, so pointedly? The wind-narrowed headlight assemblies, the
high-velocity character lines? I mean, the Fusion goes so far as to duplicate the five strakes of brightwork inside
that distinctive pout. That's cheeky.
Is it simply a matter of there being a finite number of facial geometries? (You'll note, perhaps, that the Toyota
Avalon looks like the latest product from Ford Design.) Was it, as others have suggested, a case of intellectual
property and fair play, since Ford at one time owned Aston Martin? A rebuke? That seems unlikely to me.
In any event, the Fusion's weird Aston Martin-ness was a matter of board-level sign-off, the judgment of designer
Chris Hamilton, design chief J Mays and CEO Alan Mulally. I guess we'll have to wait for the memoirs to get the
real story. Meantime, we have a car that looks like a London taxi if Aston Martin built taxis, and that's not a bad
thing.
Here come the numbers: I drove the Fusion Hybrid SE ($27,200 to start) with the luxury package and a long
menu of driver-assist systems, including blind-spot monitoring, lane-departure warning, dynamic cruise control
and self-parking ($35,365, as tested). The Fusion Hybrid employs the identical powertrain as Ford's C-Max
Hybrid; and, like the C-Max, the Fusion falls short of its claimed 47 miles per gallon in real-world driving, but not
by so much. In the Fusion Hybrid, I managed to achieve an absolute minimum mileage of 38.1 mpg. Most of the
time I was in the 40s. I'm obliged to point out that 10 years ago, such fuel economy for a big sedan was science
fiction.
The vibe in the Fusion Hybrid is one of abiding integration: the subtle slurring of ratios in the continuously variable
transmission, the share-the-load cooperation between electric and gas engine (2.0-liter, 141-hp Atkinson-cycle
four-cylinder), a sort of light, transparent flickering of power sources. There are some very good engine mounts
under there somewhere. With a net 188 hp on tap and curb weight around 3,700 pounds, the Fusion Hybrid is
quick enough off the line in city traffic but power reserves fall off at highway speeds. Even so, cane it as you may,
the Hybrid never gets shouty.
Mightily refined, quiet, serene, with deep cleverness in every corner, the Fusion Hybrid is an agreeable car;
however, the Fusion has many more colors to reveal, thanks to the broad range of available powertrains. I'm
rather looking forward to driving the car with the hot little turbo engine and six-speed manual. They could send me
the all-wheel-drive-package car, while they're at it.
There can be no greater tribute to some rank-and-file, made-by-the-million family car: I want to drive it again.
---
2013 FORD FUSION HYBRID
Price as tested: $35,365
Powertrain: Series-parallel hybrid, 2.0-liter, 16-valve, port-injected Atkinson-cycle in-line four-cylinder engine with
variable valve timing; permanent magnet AC synchronous motor; 1.4 kWh lithium-ion battery pack, 35kW max
output; continuously variable automatic transmission; front-wheel drive
Net system horsepower: 188 hp
Length/weight: 191.8 inches/3,700 pounds (est.)
Wheelbase: 112.2 inches
0-60 mph: 8.5 seconds (est.)
EPA fuel economy: 47/47/47 mpg, city/highway/combined

Cargo capacity: 12 cubic feet
Document J000000020130126e91q0000i

Two Men Who Bet Big on 787 --- Boeing's Jim McNerney and Alan Mulally, Now at Ford, Pushed for the Dreamliner
Two Men Who Bet Big on 787 --- Boeing's Jim McNerney and Alan Mulally, Now at Ford, Pushed for the
Dreamliner
By Jon Ostrower and Joann S. Lublin
1,353 words
25 January 2013
J
B1
English
Two prominent U.S. chief executives have big bets riding on the outcome of Boeing Co.'s crisis with its 787
Dreamliner, the first jetliner model grounded by U.S. regulators since 1979.
The man with the most at stake is Jim McNerney, Boeing's chairman and CEO since July 2005, who presided
over the Dreamliner's problem-plagued launch. Sharing paternity for the 787 is Alan Mulally. He oversaw the
plane's conception and early development as head of Boeing's commercial airplanes division before departing to
become head of Ford Motor Co. in 2006.
Investigators are probing what caused lithium-ion batteries to burn on two Dreamliners, triggering the grounding.
It's unclear when the 50 787s now in service globally will be able to fly again. A prolonged delay could disrupt
plans to accelerate 787 production that are important to the financial future of Boeing, the No. 1 U.S. exporter.
Mr. McNerney has kept a low public profile since a Jan. 7 battery fire on a parked Japan Airlines Co. Dreamliner
triggered the current crisis. His only public comment has been three brief written statements expressing
confidence the plane is safe and promising to work with regulators to find out and address what when wrong.
Commercial airplane chief Ray Conner was dispatched to represent Boeing at a Jan. 11 news conference with
senior U.S. government officials, and Mr. McNerney has assigned Mr. Conner and other executives to handle
much of the contact with airlines, according to a person familiar with the conversations.
Behind the scenes, Mr. McNerney has been involved in other ways, according to Tom Downey, Boeing's senior
vice president of communications. The CEO has met with FAA chief Michael Huerta, and Mr. McNerney is
running daily meetings on the status of the investigations and being updated regularly.
Friends of Mr. McNerney say the low profile is consistent with his style throughout his career, which included a
stint heading the aircraft engines unit of General Electric Co., where he was the runner-up to Jeff Immelt in the
race to succeed Jack Welch as CEO. "He is cool. He is not emotional about things," Mr. Welch said in an
interview.
But some governance specialists think the CEO should be more visible. The Dreamliner mess "is a huge hit to the
company," says Richard Leblanc, who teaches law, corporate governance and ethics at York University's School
of Administrative Studies in Toronto. "For a CEO under fire, firing off a press release is wholly inadequate."
Through a spokesman, Mr. McNerney declined to comment. The company says Mr. Conner appeared at the Jan.
11 news conference at the FAA's request because as the head of jetliner production he is Boeing's main liaison to
the regulator.
Mr. McNerney, who moved to 3M Co. as CEO after losing out to Mr. Immelt, joined Boeing's board in 2001. Two
years later he joined the other directors in unanimously approving plans to proceed with the Dreamliner. The
plane represented a big bet on new technology for Boeing: The jet's lightweight frame was to be built using mostly
carbon-fiber composites, and it was to have an enhanced electrical system to use less fuel.
At the time, Boeing had focused on building derivatives rather than new products. Mr. Mulally, then head of
Boeing's commercial airplanes operation, had to persuade CEO Harry Stonecipher and others to pursue a costly,
all new aircraft. Mr. Stonecipher and his allies were reluctant to commit to a new jetliner unless the cost fell
sharply.

Mr. Mulally was "under terrible financial constraints from Chicago" to cut the price tag of an all-new airplane, says
Aaron Gellman, a professor at Northwestern University's Kellogg School of Management who has known Mr.
Mulally for decades.
During a 2003 board meeting, Mr. Mulally and Dreamliner program chief Mike Bair made a strong pitch to launch
the 787 project, recalls a former Boeing director. "Mulally was an optimist" about how much money the new plane
could make, but Mr. McNerney and fellow directors were skeptical, the ex-board member says. They nevertheless
agreed to go ahead, figuring that "it's a wonderful plane. If we get half of that (projected) return, we would be
delighted."
In response to the pressure to reduce costs and risks, Boeing spread out the Dreamliner's construction and
design over a larger network of global suppliers than on earlier jetliners, requiring them to share costs and use
their own capital.
Boeing hired Mr. McNerney as CEO in July 2005. A year later, Mr. Mulally, who had also been a contender for the
CEO job, left.
Boeing soon stumbled as a string of supply-chain and design delays pushed back delivery of the Dreamliner by 3
1/2 years from mid-2008. "We are trying to witch-hunt the issues in this program right now," Mr. McNerney told
investors in October 2006 as the problems became apparent.
The delays strained the company's credibility with customers and investors and hurt the bottom line. Boeing
initially set a goal of keeping 787 costs to about $5 billion. Barclays Capital conservatively estimates the program
ended up costing around $14 billion, not including the penalties Boeing has had to pay customers for late
deliveries.
While Mr. McNerney had approved the Dreamliner's heavily outsourced business model as a director, his allies
say that much of the 787's initial difficulty was beyond his control.
The former Boeing director and other industry officials say that Mr. Mulally was aggressive about fulfilling the
timetable for the plane. "The outcome would have been dramatically different if he had stayed," the former board
member adds. But the ex-director said that ultimately the commitment to deliver the 787 by 2008 was a mistake
that "cost Boeing a lot of money."
Ford spokesman Jay Cooney said "it would not be appropriate" for Mr. Mulally to "comment on Boeing's business
operations."
Last week, Mr. Mulally voiced confidence in the 787. "Clearly, I haven't been at Boeing for six years now, but I will
assure you that the 787 is going to change the flying experience again, just like every other Boeing airplane," he
said at the Detroit auto show. "New airplanes are very hard; the issues that they're having right now in the big
scheme of things are relatively small."
Mr. McNerney has conceded that Boeing went too far in spreading out the 787's supply chain. "We got a little bit
seduced that it would all come together seamlessly and the same design rules would be applied everywhere in
the world and corners wouldn't be cut and financial realities wouldn't hit certain folks," Mr. McNerney told an
audience at an event in September.
To hasten completion of the complicated new aircraft, the CEO aggressively replaced key managers. Mr. Conner
is the third head of the commercial airplanes division since Mr. Mulally left. Mr. McNerney also acquired several
subcontractors in North Charleston, S.C., setting the company on a major expansion outside of its traditional
Seattle commercial base.
It's still unclear whether Boeing's supply-chain decisions over the years played a role in the firm's Dreamliner
difficulties. Aviation officials in the U.S. and Japan are trying to determine if the two major incidents this month
were caused by malfunctions in the lithium-ion batteries or if some other part of the electrical system was at fault.
Boeing's investors have held relatively steady in recent weeks, with the share price down just 3% since the crisis
began. Still, the stock has been lackluster during Mr. McNerney's tenure, rising about 14% in the 7 1/2 years
since he took over, less than half the increase in the Dow Jones Industrial Average, of which Boeing is a
component.

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Home & Digital -- Eyes on the Road: How Auto Makers Keep You Coming Back
Home & Digital -- Eyes on the Road: How Auto Makers Keep You Coming Back
By Joseph B. White
1,107 words
23 January 2013
J
D3
English
John Kwiecien, 47, is a commercial photographer who reckons he has owned vehicles from about 10 different
brands since he started driving.
"I don't want to put myself in a box," says Mr. Kwiecien, who lives in suburban Detroit. He chooses cars that fit his
lifestyle at a given time. Right now, he's driving a Volkswagen GTI, but he and companion Camille Milroy spent
part of last Sunday touring the Detroit auto show with an eye on a Jeep Wrangler Unlimited to take on outdoor
adventures with their two "big, hyper dogs."
If Mr. Kwiecien is the epitome of the automotive brand-hopper, Susan Imbrunnone, 49, also from the metro
Detroit area, is a classic loyalist. She says she's on her fifth Honda Civic and isn't looking to switch. "I don't have
any trouble," she says. "They're reliable and they're good on gas."
Auto makers are paying close attention to consumer attitudes about sticking with a brand, because loyalty isn't
just an admirable personal virtue to them. It's money in the bank. That's something every driver should bear in
mind when car shopping or wrangling with a dealer.
The latest R.L. Polk study of brand and vehicle loyalty in the auto industry, released last week, found that 48% of
people who bought a car in 2012 bought from the same brand they were already driving. Polk says the three
brands with the most loyal customers were Ford, with 61.2% repeat buyers, Mercedes-Benz (57.7%) and Toyota
(54.4%).
Reasons for staying loyal can vary. For buyers across the vehicle and price spectrum, the top attributes that
inspire a purchase include fuel economy, reliability and pricing, according to consumer research firm J.D. Power
and Associates. In the luxury segment, though, the top three criteria include performance, quality of workmanship
and exterior styling.
For car makers, it costs far less to sell to a satisfied repeat customer than it does to win one away from a rival
brand. Loyal buyers tend to spend more with a brand over time, but analysts say the days when a car dealer
could charge loyalists a lot more than a first-time buyer are mostly gone -- due to the easy availability of price
information.
"There is no more important topic for our industry, in terms of the revenue for different companies, than loyalty,"
says Jim Farley, executive vice president of global marketing, sales and service for Ford Motor Co.
Because auto makers recognize the revenue potential in loyal customers, they are offering more incentives to
stay with the brand. And whether you stick or not, it is often worth taking advantage of the offers.
The most basic weapons in the automotive loyalty wars are the cash "loyalty" discounts that car makers offer at
various times, including at year-end and during end-of-summer clearance time. Buyers shopping around can
often have those discounts matched by rival makers offering "conquest cash" to pry customers out of their old
brand. Sometimes these deals aren't publicly advertised -- you'll need to dig in automotive websites and press the
dealer.
Customers who need more than point-of-sale cash discounts to inspire loyalty will find that car makers are trying
to offer more value in other areas.
About a quarter of General Motors Co.'s Chevrolet dealers, for example, participate in what the auto maker calls
the "GM Preferred Owner" program. Customers can sign up and get points, or credits, when they get their cars
serviced at the dealership. The reward credits can be converted into discounts on repair work or on a new
vehicle, says Don Johnson, vice president for sales and service at GM's Chevrolet division. Mr. Johnson says
he's pushing more dealers to offer the program.
Maintenance and repair services -- done well -- can be a key to earning consumer loyalty, industry executives and
analysts say. This is why more dealers are offering such things as fast, low-cost oil changes to persuade drivers
that coming back to the dealership for maintenance isn't just the road to an empty wallet.
German luxury car maker BMW AG has for several years offered buyers of new BMWs four years of free
maintenance. The deal has an obvious benefit to owners, but it helps BMW and its dealers, too, because, as
BMW North America's executive vice president for operations Peter Miles puts it: "They've got to come back."
Before BMW offered the free maintenance program, only about 42% of customers got service at the dealership.
Now, close to 100% do during the first four years. That gives dealers more opportunity to nurture a relationship
with customers, and potentially pre-empt any wavering toward, say, Mercedes-Benz.
Beyond that, BMW and its dealers reward particularly loyal customers with invitations to golf tournaments, racing
events or access to BMW's performance driving track near its U.S. factory in South Carolina.
Ford Motor Co., among others, uses its vehicle-financing arm, Ford Credit, as a loyalty tool, using finance data to
target customers with offers to end a loan or a lease early -- and to encourage them to pick out a new Ford to
drive.
As vehicles have become more reliable, people are gradually widening their shopping lists, according to new
research from J.D. Power and Associates. Only 21% of shoppers buy without looking at other cars, compared
with 29% in 2010, the market research company found.
Loyalty discounts, service deals and early lease buyout offers have one aim, says Larry Dominique, president of
Automotive Lease Guide and a former executive with Nissan Motor Corp.'s U.S. arm: "Their whole goal is to stop
you from shopping."
Mr. Dominique says brand loyalty is a factor in the formulas companies use to predict a car's value at the end of a
lease -- a figure that directly affects the math determining the monthly lease payment.
Auto-industry consultancy ALG maps brands according to loyalty and resale value. Those with high loyalty and
high resale values -- Honda, Lexus and Mercedes-Benz -- often aim to charge higher prices based on their brand
power.
Bargain hunters, Mr. Dominique says, should look to brands that have high resale values -- an indicator of good
quality and attractive design -- but haven't yet built a strong loyalty base. Makes in that category include Hyundai,
Audi, Kia, Volkswagen and Mazda.
Document J000000020130123e91n0002p

New Era for European Autos
Heard on the Street

New Era for European Autos
By Andrew Peaple
291 words
17 January 2013
J
C10
English
It's Carmageddon. European Union auto sales volumes hit a 17-year low in 2012, and the 8.2% year-on-year
decline was the sharpest since 1993, according to industry body ACEA. That offers hope that the worst is behind
the cyclical industry. But investors seeking bargains should steer carefully.
Economic factors like high unemployment mean consumers are delaying purchases. Better manufacturing,
meaning cars last longer, is exacerbating the trend. The average age of Europe's fleet is 8.4 years, versus 7.6 in
2000. It could rise further: In the U.S., the equivalent figure is around 11 years.
Longer-term trends threaten car ownership. Europeans aged 15 to 64 own 0.85 car on average, unchanged in
five years. Europe's population is set to fall. Online shopping and social media are reducing the need to drive.
Annual passenger-car miles in Europe's five top economies are barely up since 2006, Morgan Stanley says.
Manufacturers must cut capacity further. Renault's decision this week to shed 7,500 jobs in France follows cuts in
Europe by Peugeot, General Motors and Ford. Even so, European plants are running at about 70% of potential,
below the 80% to 85% needed to break even, says J.P. Morgan.
Of the volume producers, only Volkswagen hits that level. It now makes 1-in-4 cars sold in the EU. At 7.7 times
expected 2013 earnings, roughly the middle of the 5-to-9-times range for peers, Volkswagen is the safest bet in a
troubled sector.
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Eyes on the Road: Would You Drive This Car? --- Auto Makers Unveil New Concept Cars; Corolla Tries to Shed its Dowdy Image
Eyes on the Road: Would You Drive This Car? --- Auto Makers Unveil New Concept Cars; Corolla Tries to
Shed its Dowdy Image
By Joseph B. White
1,245 words
16 January 2013
J
D1
English
What if you could exit your car through gull-wing doors and control its interior features with a wave of your hand?
Would a back-seat wine cooler enhance your driving experience? These are just a few ideas car makers are
testing at the Detroit auto show over the next two weeks.
The North American International Auto Show kicks off the car industry's pageant season, giving would-be
tire-kickers a preview of new models and technology headed to show rooms.
Auto makers care what people think of "concept" cars: Positive reactions to prototypes can help push vehicles
into production. The latest generation Chevrolet Camaro, first showcased in 2006, is one example.
Concept cars provide a preview of coming technologies. In the 1990s, concept vehicles began sporting
dashboards with computer-like displays and hybrid-electric powertrains -- features that didn't make it into mass
production for at least a decade. Systems that connect cars to the Web and social media have moved more
rapidly from show to market. This year, one of the newer features being showcased is "gesture recognition"
controls that promise to facilitate hands-free driving.
Here are some notable prototypes auto makers are showcasing in Detroit this week:
Tesla Model X
Like Tesla's luxury all-electric roadster before it, the Model X prototype, due to launch next year, has its share of
forward-looking Tesla features: an electric power train, the array of batteries built into the vehicle's floor and a set
of striking "falcon wing" rear doors that lift up over the roof. That's why its play-it-safe profile may look so . . .
surprising. But Tesla chief designer Franz von Holzhausen says his intention was to create a car that will be
approachable to affluent families considering a BMW X5 or other luxury SUV. Inside, its most striking feature is
the plus-sized iPad dashboard screen, but that's no concept. The company's current Model S sedan uses a
similar system now.
Build It: The Model X, unconventional doors and all, is exactly the way to overcome the prejudice that electric
vehicles are only for tech geeks and Hollywood types who don't mind compromising usefulness and comfort -- as
long as a car runs on batteries.
Bag It: Tesla has every intention of building this car. But is it too late to re-think the doors? Opening them in a
cramped garage could be a problem, and tall people could get tired of having to duck under the wings.
Hyundai HCD-14
This four-door coupe concept offers a bigger, sleeker vision of the company's higher-end Genesis model, which
launched to critical acclaim in 2009.
Hyundai Motor Co. has zoomed ahead in the U.S. market over the past several years, powered by stylish,
affordable cars such as the Sonata sedan in its bid to pull drivers from German luxury sedans like the BMW 5
series and Mercedes E-Class. While Hyundai designer Chris Chapman calls the HCD-14 more concept than
actual prototype, it may very well point the way to the next Genesis evolution, where technology like eye-tracking
(to identify drowsy or distracted drivers) will play a even bigger role. And forget buttons and knobs. New
"motion-capture" technology lets a driver set music volume and cabin temperature by waving a hand over a
steering-wheel sensor.
Build It: Hyundai is following the playbook that led Toyota to launch Lexus. The idea of a more athletic, elegant
premium sedan makes sense if Hyundai seriously aspires to compete with the Germans.
Bag It: The HCD-14 is a big, expensive car in a world that's going small. The front end leans over the boundary
between expressive and overdone. And rear-hinge doors?
Toyota Corolla Furia
The Corolla Furia concept, presented in Detroit as a shell with no interior, is aimed at preparing the public for an
overdue reincarnation of Toyota's best-selling small car. Toyota says its "ferocious" look is designed to challenge
"preconceived notions about the future of Corolla." That's because Toyota Motor Corp. is tired, very tired, of being
criticized for bland styling. The company has given its Lexus luxury line an aggressive new face, added a sporty
coupe to its Scion lineup and now is signaling plans to add more spice to its Toyota lineup.
Build It: Toyota is overdue to catch up with styling trends in the small-car market, where the old Corolla is almost
invisible. The Furia is a step in the right direction.
Bag it: Unfortunately, Furia's exterior is a step in the same direction Honda Motor Co. already took with its rival
Civic. Toyota needs to rethink the front end and give it a more distinctive profile.
Lincoln MKC
Ford Motor Co.'s Lincoln luxury brand made a killing during the 1990s selling super-sized Navigator sport utility
vehicles. The Lincoln MKC concept is Lincoln's attempt to show it can win over customers who like their utility
vehicles smaller -- a lot smaller. The Lincoln MKC concept is similar in size to the recently launched Ford Escape
crossover wagon, which shares the basic underpinnings of the Ford Focus. The Lincoln concept's interior
expands on the brand's moves to project a sort of retro-modernism. There's lots of chrome -- that's retro. But
there's no hand brake lever or shift lever in the console. Drivers choose gears by hitting a button embedded in the
console. (That revives a push-button shifting concept Lincoln used years ago.) The MKC has fanciful touches --
including a wine cooler in the console between the rear bucket seats -- but overall this show car is intended as a
signal to Lincoln dealers and would-be customers that Ford is serious about keeping the brand alive, and making
it relevant in a market where sales of small crossovers are surging.
Build It: Lincoln has some of the oldest customers, on average, in the luxury business. The MKC -- particularly the
interior -- would surprise younger shoppers who associate the brand with Grandpa's Lincoln Town Car.
Bag It: The MKC is appealing, but unless Lincoln offers it at a low price compared to the similar vehicles coming
from rival luxury brands, such as the Audi A3, it could struggle.
Nissan Resonance
The Nissan Resonance concept is a fairly straightforward presentation of what Nissan's next Murano mid-sized
crossover wagon will look like. The prototype's hybrid powertrain will more likely be an option, if offered at all. The
glass roof is a feature that was fanciful not long ago, but could be offered in the real vehicle, as could touches
such as the narrow-profile LED headlights. Inside, the Resonance features white leather seats that Nissan
describes as a "VIP lounge."
Build it: The Resonance's exterior styling -- particularly, the sleek headlights and lower stance -- give a fresh look
to a utilitarian vehicle that's long overdue for a makeover.
Bag It: The Resonance looks fine, but compare it to the Honda CR-V, Ford Escape, already on sale, and the
forthcoming Toyota RAV-4 and ask if Nissan could do more to break through the design group-think in this
segment.
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Detroit Auto Show: Denso Set To Expand American Operations
Detroit Auto Show: Denso Set To Expand American Operations

By Jeff Bennett
323 words
16 January 2013
J
B8
English
DETROIT -- Auto-parts provider Denso Corp. plans to invest $1 billion over the next four years to expand its
North American operations creating 2,000 jobs as the Japanese company looks to keep in step with new-car
demand.
About $750 million will be invested in the U.S., creating 1,200 jobs in Michigan, Tennessee, Iowa, California and
North Carolina. Denso also will open a new assembly warehouse, a new manufacturing center and add lines for
production of automotive thermal products.
Denso, based in Kariya, Aichi, Japan, joins a flood of new job creation announcements as the U.S. auto industry
continues to rebound. General Motors Co. said last week it would open a new technology center outside Atlanta
and hire 1,000 tech professionals. Ford Motor Co., meanwhile, said it plans to hire 2,200 salaried employees in
the U.S. this year -- the most in more than a decade.
Buoying the auto makers and parts suppliers are U.S. consumers looking to replace aging vehicles. Auto sales
topped 14.5 million new cars and light trucks last year, a 13% increase over 2011. Analysts expect more than 15
million new vehicles to be sold this year. Auto makers also are demanding more fuel-efficient technologies in
response to stricter emissions rules.
Denso, which has its North American headquarters in Southfield, Mich., is the largest maker of automobile
thermal products such as radiators and air-conditioning systems in the world. Its customers include all of the
global auto makers that do business in the U.S.
In Canada and Mexico, Denso will invest about $150 million to increase manufacturing capacity.
"The scope of activity means we're becoming more regionally independent and self-reliant," said Jack Helmboldt,
Denso's corporate senior director.
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Detroit Auto Show: Mercedes, BMW Shift to Young Buyers --- Small Luxury Cars Target Ford, Honda
Detroit Auto Show: Mercedes, BMW Shift to Young Buyers --- Small Luxury Cars Target Ford, Honda
By Vanessa Fuhrmans
861 words
15 January 2013
J
B6
English
Germany's luxury-car makers, fresh from record 2012 sales, plan to launch new, lower-priced models designed to
draw younger, less-affluent Americans away from mass-market brands like Ford Motor Co., Honda Motor Co. and
Toyota Motor Corp.
On Monday, BMW AG unveiled a new version of its top-selling 3 Series sedan, designed to have a starting price
about $4,000 less than its currently least-expensive $37,000 U.S. 3 Series. A day earlier, Daimler AG showed its
coming 4-cyclinder Mercedes-Benz CLA, which executives hinted could start just below $30,000. Audi is working
on the 2014 release of a four-door version of its new A3 compact, expected to cost in the mid- to high $20,000
range in the U.S.
The three vehicles, which are also destined for China, represent the most concerted effort in a decade to lower
the barrier to entry to their brands in the U.S. Their expected starting prices are close to the U.S. average selling
price, which auto shopping website Truecar.com put at $31,228 last month. The key customers, especially for
Mercedes, are those in their 20s, 30s and early 40s whose numbers rival the size of the baby-boom generation.
"This group is 75 million strong," Daimler Chief Executive Dieter Zetsche said during Sunday's launch of the CLA
ahead of the North American International Auto Show in Detroit. Scott Keogh, head of Audi's U.S. operations,
said a lower-cost A3 sedan has the potential to become the second- or third-highest volume model in Audi's U.S.
lineup, attracting younger buyers and the "host of people moving out of non-luxury brands."
Their plans present a potential threat to Detroit's efforts to push loaded versions of mainstream sedans such as
the Ford Fusion and Chrysler 300 above $30,000. Brands such as Lexus, Acura or Cadillac also could face more
pressure.
The German brands face some risks as well. Cheaper sedans could cut into sales of their more expensive
models. It also isn't clear that U.S. consumers affluent enough to buy or lease a $30,000 to $35,000 car will flock
to small cars or utility vehicles originally designed with Europe's high gas prices in mind.
Mark Reuss, General Motors Co.'s head of North America, said such down-market moves haven't succeeded in
the past, citing BMW's 1-series push in the U.S. He said the German companies' lower-priced cars likely would
disrupt their own used-car sales.
Executives at the three German brands say they can offer lower- priced models thanks to a combination of
streamlined engineering and manufacturing operations that can produce vehicles at lower cost. The weakening of
the euro against the dollar also makes it easier for the German brands to sell their small, European-built models
profitably in the U.S.
Mercedes hopes to win young, affluent buyers such as 33-year-old Andy Yang. Mr. Yang, a New York online
marketing director, said his parents always admired Mercedes cars, but he has been drawn to BMW's more
youthful, high-performance reputation.
Shopping for a new car in November, he took a cursory look at a Mercedes but ended up buying a BMW 335
compact sports sedan instead. "To me, BMW represents sporty and luxurious," Mr. Yang said. "Mercedes is just
luxurious."

In the U.S., the average age of a Mercedes owner is 52, three to four years older than the typical driver who
steers toward BMW or Volkswagen's AG's Audi, according to researcher R.L. Polk & Co. That is a problem in
China, where the average millionaire is in his or her early 40s.
"We need to keep our ecosystem healthy, and that includes replenishing it with new buyers who can come in at
the lower end of the brand," said Steve Cannon, Mercedes-Benz's U.S. operations chief. The younger they start
driving a Mercedes, the more they're likely to buy higher-end versions as they get older and wealthier, he said. "If
there is a risk, it's not doing this."
Mercedes's CLA marketing campaign kicks off during the Super Bowl next month with an ad featuring the singer
Usher and swimsuit model Kate Upton. The pressure to woo younger buyers is growing as the buying habits of its
traditional, older clientele also are changing.
"Older car buyers tend to be more cautious," says Jesse Toprak, a senior analyst with industry
researcherTrueCar.com.
Not everyone approves of Mercedes's approach to wooing the younger crowd. As the car maker moves to a more
muscular styling in its smaller cars, it risks tarnishing the classic luxury image that has set it apart, says Gernot
Bracht, a former Renault SA designer who teaches at the Pforzheim School of Design in Germany.
---
Joseph B. White contributed to this article.
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VC Dispatch / U.S. Venture-Capital Financings
Technology
VC Dispatch / U.S. Venture-Capital Financings
436 words
15 January 2013
J
B5
English
STREETLINE
Where Is a Parking Spot?
The Sensors Know
Streetline Inc. wants to put an end to the days of driving aimlessly around congested city streets hoping for a
parking space to magically appear.
The company is installing ultra-low-power wireless sensors in the ground of individual parking spaces in more
than 30 cities that can detect the presence of cars and then feed the data into mobile apps and, soon, in-car
navigation systems, the company said.
Among the cities being outfitted with the sensors are Los Angeles, San Mateo and San Carlos in California, and
Birmingham, U.K.
International Business Machines Corp., Siemens AG and Xerox Corp. are reselling Streetline's technology. Chief
Executive Zia Yusuf said the company is in discussions with automotive companies and map companies that
want Streetline's data.
Streetline's investors -- which recently provided the company with $25 million -- include Fontinalis Partners,
founded by Ford Motor Co. Executive Chairman Bill Ford. New investors include Citibank and Qualcomm
Ventures.
Besides wireless sensors, Streetline provides a mobile app called Parker that provides a map with data such as
availability and price. For garages integrated with the app, drivers can pay directly from their smartphone.
Streetline faces several competitors that provide parking apps, although Mr. Yusuf says his company is different
because it captures data in real time and layers the data into its platform, while also providing analytics.
-- Deborah Gage
---
LEAP MOTION
An iPod-sized device that lets people control their computers using hand motions is one step closer to the market.
San Francisco-based Leap Motion Inc. recently raised $30 million in Series B capital led by Founders Fund to
help ship the $69.99 device at the end of the first quarter. After calibrating the controller with software, users can
wave their hands or move their fingers to perform actions normally done with a touch-screen or mouse.
---
ALTITUDE DIGITAL
Denver-based Altitude Digital Inc. has spent the past three years providing a service that enables Web publishers
to auction off individual ad space as visitors come to a page. Now the company is beefing up its emphasis on
video advertising to take advantage of higher ad rates. The company, which raised $5 million from Mercato

Partners, made $13 million in revenue last year. It served about 12 billion ads a month, and about 1.5 billion of
those were video ads.
---
Compiled by the staff of VentureWire, online at pevc.dowjones.com
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Detroit Auto Show: Honda Recovers In China
Detroit Auto Show: Honda Recovers In China

By Mike Ramsey
363 words
15 January 2013
J
B6
English
Honda Motor Co. Chief Executive Officer Takanobu Ito said his company's business largely has recovered in
China but remains below the pace before the governments of Japan and China began sparring over a series of
islands in the East China Sea.
Customer traffic in its mainland showrooms is about 90% of what it had been before the crisis, Mr. Ito said in an
interview Monday at the North American International Auto Show in Detroit. He said the leaders of both countries
recognize the business importance of each country to the other.
Honda and other Japanese car makers have suffered lower sales in China since the dispute boiled up last
summer. Other car makers in China, including Ford Motor Co., General Motors Co. and Volkswagen AG, have
seen their sales boosted as customers avoided the Japanese brands.
Despite Mr. Ito's hope for diplomacy, tensions continue to increase in the region. The new conservative
government in Japan hasn't backed down over the disputed ownership of the islands, called Senkaku in Japan
and Daioyu in China, and has been running military exercises.
Honda is on the rebound globally after a difficult year in 2011 when an earthquake interrupted its supply of
vehicles and when critics panned its new Civic sedan. Honda forecasts that it will break its U.S. sales record of
1.55 million vehicles set in 2007 in 2013.
Honda unveiled a prototype of a new small SUV at the Detroit auto show that the company expects to be a major
vehicle. The new small SUV, Fit and City may combined sell 1.5 million vehicles globally by 2016, said Tetsuo
Iwamaru, president of Honda's North American operations.
The five-door hatchback will be manufactured at Honda's plant in Celaya, Mexico, as well in Japan and Thailand.
Mr. Ito said with the small SUV, about 95% of the vehicles that Honda sells in North America will be built in the
region, a level that would rival or surpass U.S.-based manufacturers.
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Detroit Sheds Pounds For Gas-Mileage Gains
Detroit Sheds Pounds For Gas-Mileage Gains

By Neal E. Boudette and Mike Ramsey
1,152 words
14 January 2013
J
A1
English
DETROIT -- Auto makers wrestling with ambitious mileage goals have touted hybrids and electrics as the wave of
the future, but they have found a quicker path to improved fuel efficiency, reinventing the way traditional
gas-powered cars are built.
For the past century, autos were made largely of steel. But pressed to produce cars and trucks that go farther on
a gallon of gas, manufacturers gathering here this week for the Motor City's annual auto show are cutting weight
by substituting more plastics, aluminum and magnesium, including materials once found only in high-end race
cars.
Only a handful of parts fashioned from new, lightweight materials are in current models -- for example, the
magnesium tailgate of the Explorer, the sport utility vehicle from Ford Motor Co. But in four to six years, car
companies will roll out vehicles completely redesigned to use a wide mix of specialized materials.
Ford is testing a prototype F-150 pickup truck -- aimed for launch by 2015 -- that features aluminum instead of
steel body panels. It will weigh 700 pounds less than the current model, the company said, a reduction of about
15%.
Other lighter-weight vehicles will be unveiled this week at the North American International Auto Show here. The
new Chevrolet Corvette that made its debut Sunday features an underbody made of aluminum, and a hood and
roof made of carbon-fiber composite, the same material used in Formula One race cars. BMW AG will display an
electric car with a frame made of the same composite. The new Lincoln MKZ sedan will showcase an aluminum
roof frame.
"Vehicles are going to look very different in a dozen years," Robert Bienenfeld, senior U.S. manager for energy
strategy at Honda Motor Co., said at a recent symposium on fuel-economy. "We are going to redefine what a
conventional vehicle is."
The federal government is requiring auto makers produce vehicle fleets that average 54.5 miles per gallon by
2025, roughly double today's standard. Europe has set limits on carbon-dioxide emissions that, in effect, impose
similar fuel-economy targets.
Shaving weight is one strategy auto makers will use to reach those goals. Ducker Worldwide, a market
researcher based in Troy, Mich., predicts the average vehicle will shed 400 pounds by the 2025 deadline through
a doubling of aluminum. Steel, which now accounts for 56% of average vehicle weight, is expect to fall to 46%,
according to the research group.
The U.S. Council for Automotive Research, a collaboration of General Motors, Ford and Chrysler Group LLC,
estimated about 350 pounds of magnesium will be used in the average vehicle by 2020, replacing 500 pounds of
steel.
A recent fuel-economy symposium in Ann Arbor, Mich., offered a further look into the future. Matthew Zaluzec,
the manager of materials research for Ford, showed how a six-pound glass pane in a side window of Ford's
Transit Connect van could be replaced with polycarbonate plastic. "Just 3.7 pounds," he said, "a 40% savings."
Behind him, two identical fenders hung on a rack. Both were made of a plastic known as a sheet molding
compound. One fender, which uses glass shards for strength, weighed 10 pounds. The other used hollow glass
spheres and weighed 6.9 pounds.

Ford also showed off a C-Max Energi wagon, which runs on a gas engine or an electric motor powered by a
rechargeable battery pack. It is rated at 47 miles to the gallon, although Consumer Reports said it drove 39 miles
a gallon in its test.
Mr. Zaluzec said the current version uses few aluminum or magnesium parts. Substituting such lighter materials,
he said, would boost its mileage close to the 54.5 mile-per-gallon mandate. "I'm confident we can do that," he
said.
Car companies say lightweight materials will afford passengers the same amount of protection as steel because
the substitute parts -- say, an aluminum pillar -- can be engineered with the same strength. Race cars, say
companies, are made of similar lightweight materials.
The strategy holds some uncertainty for the auto industry. Aluminum is more expensive than steel, and
magnesium is more costly still. Auto makers have no guarantee they can raise new car prices to cover the higher
costs. The new materials are also tougher to fashion than steel. Stamping magnesium parts, for example, is
difficult because the metal tends to spring back to its original shape.
The shift to lighter vehicles marks a significant industry change. Until 2010, car companies were waging a motor
arms race, offering ever brawnier engines of 400 horsepower and more. Sating customer appetite for more power
made fuel-economy gains difficult. Bigger engines require bigger engine mounts, heavier brakes, stiffer
suspensions -- adding weight and boosting fuel consumption.
Not long ago, many auto executives said little could be done to improve fuel-economy without adding massive
costs. Then gas prices soared to $4 a gallon and consumers demanded more fuel-efficient cars.
Automotive engineers are now taking advantage of basic physics: lighter-weight cars can accelerate quickly with
smaller engines. At Ford, a version of the Fiesta subcompact, due in 2014, will be powered by what once would
have been seen as a joke: a three-cylinder engine.
"Today, we look at lightweighting anywhere we can," said Mr. Zaluzec, of Ford.
Last year, the average fuel-economy of vehicles purchased by consumers improved 6%, to 23.8 miles per gallon,
primarily because of new technology. They gains weren't driven by a move to gas-electric hybrids or electric cars,
which make up only a small percentage of the U.S. auto market.
The improvements sprang from technology applied to engines and transmissions. More engines were equipped
with turbochargers, devices that force compressed air into an engine; and direct gas injection, a means of
squirting pressurized fuel into a cylinder. Both boost power without increasing fuel consumption.
That technology hooked Joe Opsahl, who last month bought a new four-door Ford F-150 pickup truck. A manager
in a family-owned concrete construction company in Brighton, Mich., Mr. Opsahl opted for a turbocharged,
direct-injection V6 engine, which Ford calls EcoBoost.
"I've got the power of a V8," he said, "but it doesn't use as much gas as a V8, and that's pretty nice."
Still, engine tweaks and lightweight materials will only bring the auto industry part of the way to the federal
government's mileage targets.
After about 2020, electric cars and hybrids will have to make up a larger portion of the vehicles on the road to
reach the mandated 54.5-miles-per-gallon fleet average.
"That's where costs will go up more significantly," said Honda's Mr. Bienenfeld.
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Industry's New Year Buffet: Entrees and a Few Desserts
DETROIT AUTO SHOW

Automobiles; SECTAU
Industry's New Year Buffet: Entrees and a Few Desserts
By JERRY GARRETT
1,284 words
13 January 2013
The New York Times
NYTF
2
English
THE annual North American International Auto Show, which opens in Detroit on Monday with two days of press
previews, is off life support after a few touch-and-go years when various automakers pulled out and some
threatened to go elsewhere.
More than 50 concept cars and production models are set to be revealed. While the volume of introductions is not
overwhelming -- shows in Geneva, Paris and Frankfurt may feature twice as many -- the vehicles being shown
are critically important, including new pickup truck designs from Ford and General Motors, revamped
Mercedes-Benz E-Class models and a next-generation Chevrolet Corvette.
Sales ended 2012 on a strong note, so automakers are unveiling their latest models with high expectations. Here
are some of the anticipated highlights:
ACURA The MDX crossover gets a complete makeover, including a much-needed nose job, in a concept version
that is likely to differ relatively little from the production-ready version that will be seen at the New York auto show
in March.
AUDI Having rolled out new versions of its top sellers over the last couple of years, Audi will be in Detroit to
promote performance tweaks for the existing lineup. In addition to a mild face-lift of the R8 supercar, Audi will
show a convertible version of its powerful RS5 coupe, an S-Line performance version of the Q5 crossover and
possibly an RS version of its big A7.
BENTLEY With 625 horsepower and a top speed of 202 m.p.h., the latest version of the Continental GTC Speed
convertible will be an even faster version of what I once called the world's fastest four-person hair dryer.
BMW The popular 3 Series coupes are being revised and spun off into a new 4 Series line; the new car is longer,
lower, wider and curvier. BMW is also showing a high-performance 560-horsepower M version of the 6 Series
Gran Coupe.
CADILLAC Remember the Converj concept coupe that Cadillac unveiled to great fanfare in 2009? It's back in
revised form as the 2014 ELR plug-in hybrid, which some are calling the ''Voltillac'' because of the car's electronic
kinship with the Chevrolet Volt.
CHEVROLET Promoting the new seventh-generation Corvette is Chevy's main aim at the show. But while the
halo sports car is certainly the most delectable morsel on G.M.'s dessert menu, meat-and-potato entrees will also
be served, like the 2014 Silverado pickup and Impala sedan.
CHRYSLER With little actual news, Chrysler's marketers turned to conjuring up special packages for existing
models like the 300 sedan. The latest is a Motown-theme version with a sound system enhanced for rhythm and
blues and preloaded songs by Motown stars.
DODGE In recent years, Dodge was stripped of its truck line (now badged as Rams), its Viper sports car (now an
SRT) and its Magnum wagon (now deader than Plymouth). So Dodge will concentrate on its Dart subcompact at
the show, adding a GT version with added power and performance.

FORD The long-running game of crosstown one-upmanship continues as Ford rushes to greet G.M.'s new
pickups with a sneak preview of its still-percolating 2015 F-150. Ford is also showing new Transit vans, a new
turbocharged 3.5-liter EcoBoost V-6 and a 5-cylinder 3.2-liter diesel engine.
HONDA With the CR-V enlarged and the Element discontinued, Honda has a hole at the low end of its crossover
lineup. So it will show a concept version of a model based on the Fit hatchback. Production is expected in Mexico
in 2014.
HYUNDAI Having made no secret of its desire to move upmarket, the Korean automaker will unveil a luxury
sedan concept that could be the basis for the next-generation Genesis sedan, expected as a 2014 model.
INFINITI The G37 entry-luxury sedan has been redesigned and gets a new name: the Q50. The larger M sedan
becomes the Q70, but it will remain largely unchanged for now.
JEEP Didn't we just see a new Grand Cherokee? If that's how it seems, you're probably thinking of the recent
SRT version. But it's already time for a restyled and re-engineered Grand Cherokee. The 2014 model will get
much better fuel economy with an 8-speed automatic transmission, and both diesel and SRT performance
versions will be offered.
LEXUS The LF-CC concept shown in September in Paris has changed, slightly, into the production version of the
IS compact sedan. The IS, which will also come later as a hybrid, shares a platform and a 3.5-liter V-6 with the
larger GS sedan. But for those Lexus buyers who have been clamoring for even less power and torque, an
entry-level 2.5-liter 4-cylinder will also be offered.
LINCOLN Desperate for a reset, Ford's luxury division is now calling itself the Lincoln Motor Company, and its
business plan is to remake Fords into Lincolns by adding features and raising prices. The latest of these is the
MKC, a well-garnished rendition of the latest Ford Escape.
MASERATI Although this Fiat-owned brand has aspirations to sell a lot more cars than it does now, that's a tall
order for a company with essentially two models. But the redesigned Quattroporte sedan, to be shown here,
should provide a jump start.
MAZDA NBC once used the slogan ''It's New to You!'' to promote reruns of shows you might have missed. That
would work for the Mazda 6 as well: for some inexplicable reason, Mazda unveiled its biggest sedan at the
Moscow auto show. It was put on display again, with little fanfare, in Los Angeles six weeks ago. Now, in case
you missed it, it will appear in Detroit. The car, which will bring new fuel-saving technology to a highly competitive
class, is actually worth a look.
MERCEDES-BENZ One might think that Mercedes would have reserved its showing of the midcycle revamping of
the E-Class sedan and wagon for one of the European shows later this year. But the car is an icon in America --
it's a taxi in Germany -- and will thus make its debut in America. The biggest Mercedes news will not happen in
the show hall, but at an off-site gala where the 2014 CLA, a small $30,000 front-drive sedan, will get a sneak
preview. It will then be whisked away until its official debut at the Geneva show in March.
NISSAN For those disappointed that the restyled 2013 Versa lineup did not include a hatchback, the mourning is
over. The 2014 hatchback will be featured at a lavish new display stand, a splashy embrace of a show that
Nissan actually skipped for three years when the industry was on the ropes. Nissan will also show a hybrid design
study, the Resonance, that will hint at the look of the brand's future crossovers.
TOYOTA Secrecy has been tight around the Furia concept car, but a few teaser photos suggest that this design
might bring some bright new ideas for the mousy, workaday Corolla sedan.
VOLKSWAGEN A seven-seat S.U.V. design study is expected, along with a Passat concept car with a more
powerful engine.
MOTOWN BOUND: Clockwise from top, debutantes include the Maserati Quattroporte, Chevy Silverado, Lexus
IS, Mazda 6, Mercedes E-Class sedan and wagon and Dodge Dart GT. (PHOTOGRAPHS BY MASERATI
NORTH AMERICA; GENERAL MOTORS; TOYOTA MOTOR SALES; MAZDA NORTH AMERICA;
MERCEDES-BENZ USA; CHRYSLER GROUP)
Document NYTF000020130113e91d0003a

A Glimpse Into the Future of Parking
WHEELS
Automobiles; SECTAU
A Glimpse Into the Future of Parking
By JOHN R. QUAIN
627 words
13 January 2013
The New York Times
NYTF
4
English
Finding a parking spot is such a travail that Calvin Trillin once wrote a book about it. But with the debut this week
at the Consumer Electronics Show in Las Vegas of a new navigation and parking service, such driver headaches
could eventually go the way of the hitching post.
Inrix, which already delivers live traffic information to major car companies, including Ford, BMW, Audi and
Toyota, for their in-dash navigation systems, is introducing Inrix Parking, live information on available parking
spaces and prices that is sent directly to drivers. Until now, there were separate smartphone apps available, but
Inrix is aggregating all this information on an international basis and integrating it with navigation and traffic
information.
"The trouble with parking is that it's a very fragmented market with a lot of independent operators and a lot of
information that isn't available on the Internet," explained Scott Sedlik, vice president of product planning and
market development at INRIX during a pre-CES briefing. So Inrix is partnering with two companies that collect
parking information, ParkMe in North America and Parkopedia in Europe, to deliver up-to-date information on
18,000 parking facilities in North America and 42,000 in Europe.
In a demonstration, an on-screen map revealed roughly 1,700 parking lots in New York City, while in a car's
center console a couple of nearby alternatives appeared along with distance and pricing information. Drivers will
be able to filter results according to preferences of proximity or price. Mark Pendergrast, a senior product
manager at Inrix, said the percentage of lots covered would vary from city to city, but in Manhattan, he estimated
that 60 percent of facilities were included.
Inrix Park will first appear built into Kenwood's DVD entertainment car receivers, the Excelon DNN990HD and
DNN770HD, which also offer local gas prices and live traffic warnings. Pricing for the in-dash receivers wasn't
announced, but because the parking information is a service that is sent wirelessly to cars, the parking data can
also begin appearing in existing vehicles from Ford and Toyota this year without additional charges.
When combined with turn-by-turn directions, it's hoped that such parking information could help save fuel, reduce
traffic, and driver frustration, although this first version won't be perfect. Many lot operators still resist sharing
pricing and lot information for fear competitors will undercut them, Mr. Pendergrast said. And there are a wide
variety of lot management systems in use, making it difficult to track the number of empty spaces precisely.
There's also the question of street parking, which the service will not initially include.
Systems for monitoring on-street parking are still evolving, Mr. Sedlik said. "But what's more exciting is the
payment component of on-street parking," he said. In the not-too-distant future, you should be able to not only
find a spot but also pay for it automatically from your car. No more searching for loose change. And when your
time is about to expire, an app will sound a warning on your smartphone so that you can choose to move or add
more money to the virtual meter from your seat in a restaurant.
Just as live traffic information has improved in accuracy and utility over the last few years, Mr. Sedlik expects
parking information to become increasingly useful, including the option of reserving a space before you arrive and
listing nearby electric vehicle charging stations. That could not only help relieve parking stress but also E.V.
owners' range anxiety.

Document NYTF000020130113e91d00030

Ford Plans To Hire 2,200 Salaried Workers In U.S.
BUSINESS BRIEFING | AUTOMOBILES

Ford Plans To Hire 2,200 Salaried Workers In U.S.
By THE NEW YORK TIMES
228 words
12 January 2013
The New York Times
NYTF
2
English
The Ford Motor Company said on Friday that it planned to hire 2,200 salaried workers in the United States this
year, its largest increase in new salaried workers in more than a decade, to support new Ford product
introductions. The hiring is in addition to the more than 8,100 combined hourly and salaried jobs Ford created in
the United States in 2012, as the company increased production capacity and expanded engineering,
manufacturing and other areas to meet the growing demand for its vehicles, the company said. About 1,000 of the
positions are hourly jobs brought back to Ford plants in the United States from other locations, including Japan
and Mexico. Ford said it was more than halfway to the 12,000 new jobs it committed to deliver in the United
States by 2015 as part of its 2011 contract with the United Automobile Workers.
''As we expand our product lineup of fuel-efficient vehicles, we need more people in critical areas, such as in a
range of engineering activities, vehicle production, computer software and other I.T. functions, to ensure we
deliver the vehicles people want and value,'' Joseph R. Hinrichs, Ford's president for the Americas, said in a news
release.
Document NYTF000020130112e91c00060

For Sale: Used Ford, Careful Owner
Heard on the Street

For Sale: Used Ford, Careful Owner
By Liam Denning
341 words
11 January 2013
J
C8
English
Ford Motor is one defensive driver.
You would be, too, if you had a near-death experience -- in Ford's case, the financial crisis that pushed its stock
down to about a buck. Since then, it has carefully overhauled its balance sheet and North American operations.
Despite this progress, the stock has essentially gone nowhere since early 2011; the past two years have both
seen early rallies fade.
So can Thursday's announcement that Ford is doubling its dividend this year change that? It should, if only
because it ought to highlight the car maker's ability to generate cash.
Ford's earnings growth this year is forecast to be about 9%, slightly below the S&P 500. Besides restructuring
costs in Europe, earnings will be held back by noncash items such as higher depreciation charges.
But this obscures Ford's rising cash flow. Analysts expect cash flow from operations to rise by half this year to just
under $10 billion, according to FactSet. Capital expenditure is pegged at $5.5 billion. That leaves plenty of room
for the roughly $1.5 billion that the new dividend requires.
The annual 40-cents-a-share payout gives Ford's stock a dividend yield of 2.9%, taking it from a discount to the
S&P 500 to a premium. This ought to tempt some more income-oriented money managers.
More important, making this move even as recovering North American vehicle sales remain below trend and
Europe is still weak should reinforce the notion that the postcrisis Ford is built to last. Its success in remaking the
North American business gives its European restructuring plan credibility, offering a route to further gains down
the road.
Investors are rightly wary of continuing macroeconomic risks weighing on the short term. But it doesn't pay to be
too careful.
Document J000000020130111e91b0000s

Story stocks
MONEY
Story stocks
117 words
11 January 2013
USAT
FINAL
B.7
English
Ford Motor
Price: $13.83
Chg: +36 cents
% chg: +2.7%
Day's high/low:
$13.94/$13.68
The U.S. automaker is doubling its quarterly dividend to 10 cents a share. The dividend increase comes nine
months after the company resumed the payouts after suspending them for five years.
Herbalife
The CEO of the health product marketer, Michael Johnson, denied charges by hedge fund manager Bill Ackman
that the company was fraudulent at a meeting with investors.
Supervalu
The grocery chain is selling its Albertsons, Acme, Jewel-Osco, Shaw's and Star Market stores to private-equity
firm Cerberus. Cerberus also plans to buy 30% of Supervalu's shares.
graphic
Document USAT000020130111e91b0008e

Corporate News: Nissan to Build Lower-Cost Leaf Electric Car in U.S.
Corporate News: Nissan to Build Lower-Cost Leaf Electric Car in U.S.

By Mike Ramsey
548 words
10 January 2013
J
B6
English
Nissan Motor Co. on Thursday began building its Leaf electric cars for the first time at a plant in the U.S., aiming
to lift disappointing sales of the $35,000 vehicle by introducing a less expensive model.
Nissan in February will begin selling Leafs made at its Smyrna, Tenn., plant. The Leaf has been assembled at a
Japanese plant and exported around the globe.
Sales of the Leaf have been sluggish, in part because a large battery pack, which makes the compact car more
expensive than similar-size gasoline-powered vehicles. A limited driving range -- the car can go about 80 miles on
a charge -- and long recharging time have hampered its sales.
Last year Nissan sold 9,819 Leafs in the U.S., just 1.5% more than in 2011. and less than half of the original
20,000 target.
Nissan executives have said they are confident sales of the Leaf will improve once U.S. production began.
However, the Leaf faces more competition. Ford Motor Co., General Motors Co., Toyota Motor Corp., Chrysler
Group LLC and Honda Motor Co. will sell electric vehicles by the end of this year.
Nissan has said it could build up to 150,000 Leafs a year in Tennessee. Both projects were financed with $1.4
billion in U.S. Department of Energy loans designed to promote investment in fuel-efficient vehicles.
Nissan hasn't yet made public the starting price of the new base model Leaf, which will be known as the Leaf S.
After originally starting the vehicle at $32,800 in its first year on the market in 2010, Nissan raised the price by
$2,400 to $35,200, mostly because of the stubbornly high yen against the dollar. Building the car in the U.S.
should lower Nissan's production costs and give Nissan more flexibility on pricing.
The car is eligible for a $7,500 federal tax credit and many states also offer tax credits for electric vehicles as well.
Nissan is counting on changes to the 2013 model to extend its range and shorten charging times. The company
maintains that the vehicle's range should be longer than the rating of 73 miles that was calculated by the U.S.
Environmental Protection Agency. Nissan also says that charging times from a 240-volt outlet should be cut in
half, from the 7.5 hours the 2012 model requires to fully charge.
The first plug-in electric vehicles arrived in 2010, and only now are gaining some traction. Consumers purchased
54,000 plug-in models in 2012, out of a total new vehicle market of about 14.5 million, according to Pike
Research, a Boulder, Colo., research firm.
Pike estimates 2013 sales will top 71,000 and rise to around 367,000 by 2020 in the U.S. The figures combine the
sales of pure electric vehicles like the Leaf and plug-in hybrids, like the Chevrolet Volt and Prius Plug-in, which
have small gas engines on board to recharge their batteries or keep them going when battery power runs down.
Document J000000020130110e91a0000g

Japan's Autos Need Repair in China
Heard on the Street

Japan's Autos Need Repair in China
By Tom Orlik
546 words
9 January 2013
J
C12
English
Japanese auto makers are hoping to get their China sales out of reverse gear. In the meantime, rivals such as
General Motors and Ford Motor can press on the gas.
Toyota Motor is expecting to sell 900,000 cars in China in 2013, up 7.1% from 840,000 last year. Honda Motor is
targeting 750,000 units, a 25% year-on-year increase supported by new models coming to market.
China is now the biggest auto market in the world by volume: Deutsche Bank expects about 21 million vehicles
will be sold there this year, one-in-four world-wide. The country accounted for about 12% of sales for Toyota and
almost 20% for Honda in the year ended in March 2012.
Any sales growth this year would be an improvement over 2012, when a territorial dispute with Japan led to
protests in China, with angry mobs smashing Japanese shops and cars. Toyota's China sales fell 4.9% below
their 2011 level and 16% below the company's target of a million units.
Getting sales back in top gear in China won't be easy. Tensions over disputed islands have dissipated, not
disappeared. China's regional ambitions and the nationalist bent of Japan's new prime minister, Shinzo Abe,
mean more protests can't be ruled out.
Even without another blowup, the impact of the 2012 protests will linger. Chinese auto dealers may shift their
investment focus to U.S. and Korean brands. Ford and Hyundai Motor have both benefited from buyers switching
away from Japanese vehicles. Ford achieved its highest-ever market share in China in the third quarter, helping
to build a business where it continues to invest heavily.
For GM, though, China already generates big profits, second only to North America according to Credit Suisse.
Analyst Chris Ceraso says China contributes about $1.5 billion of net income annually. That is equivalent to about
a quarter of the current consensus estimate for GM's overall net income in 2012.
Even if Toyota and Honda hit their objectives, higher-volume sales won't pass through directly to higher profits.
China auto-market analyst Michael Dunne says he expects passenger-car sales volumes to rise by 7% to 8% in
2013.
But oversupply could weigh on prices; investment in auto production was up 32.9% year on year for the year to
November 2012, compared with a 6.9% increase in unit sales.
Globally, Japan's auto exports should benefit from the yen's recent weakness, as well as a strengthening of the
South Korean won -- currently at its strongest level against the U.S. dollar since the summer of 2011 -- which
shaves away the price advantage of Korean cars. In China, though, with most cars produced in the country,
foreign-exchange movements don't have such a big impact.
Honda's ambition to speed past the growth of the China market as a whole looks difficult to achieve. Toyota's aim
to keep pace looks more realistic, but it might have to lose margins to gain ground.

Document J000000020130109e91900015

Corporate News: Japan's Car Makers Perk Up --- Sales Look Poised to Recover From Protests in China, Subsidy Expiration at Home
Corporate News: Japan's Car Makers Perk Up --- Sales Look Poised to Recover From Protests in China,
Subsidy Expiration at Home
714 words
8 January 2013
J
B3
English
Copyright © 2013, Dow Jones & Company, Inc.
Japanese auto makers are regaining confidence in the Chinese market, setting ambitious targets for growth this
year after last year's sales were disrupted by cross-border tensions.
Tokyo in August said it planned to nationalize disputed islands in the East China Sea. The announcement
prompted anti-Japanese protests across China and sharp declines in purchases of Japanese cars.
But December data pointed to a faster-than-expected recovery for Chinese sales of Japanese cars, and some
auto makers expressed optimism that the worst was over.
Meanwhile, auto sales within Japan continued to hold up well last month, despite the end of government
subsidies.
Toyota Motor Corp., Japan's No. 1 auto maker by sales, said Monday that it sold 840,000 vehicles in China last
year, down 4.9% from 2011. Sales last month declined 16% from a year earlier to 90,400 vehicles, after falling
22% in November, 44% in October and nearly 50% in September.
Toyota set a 2013 China sales target of more than 900,000 vehicles, up 7% from last year and well above the
overall target of 2% growth for world-wide sales.
Honda Motor Co. targeted 25% growth in China sales to 750,000 vehicles for this year. The No. 3 Japanese auto
maker posted a 3.1% decline last year. "We believe new models to be launched will boost sales significantly," a
Honda executive said.
But Nissan Motor Co. Chief Operating Officer Toshiyuki Shiga said that while sales of Japanese vehicles in China
are improving, Japanese auto makers aren't yet bringing back customers who moved to German or South Korean
brands.
Nissan's sales in China fell 24% last month to 90,400 vehicles. That compares with a 30% decline in November
and a 41% drop in October for Japan's second-biggest auto maker.
Sales of autos from other countries have raced ahead in China. Sales by Ford Motor Co. and its joint ventures
reached 70,510 vehicles last month, up 43%. Ford's full-year sales rose 21% to 626,616 vehicles.
China imports relatively few passenger cars, and foreign auto makers are required to team with domestic partners
to produce cars in the country.
Production at Honda's joint venture with Dongfeng Motor Group Co. has returned to its normal level, while output
at its joint venture with Guangzhou Automobile Group Co. was expected to return to its pre-crisis level this month,
Honda said.
Honda sold 63,264 vehicles through its two joint ventures in China last month, down 19% from a year earlier. That
followed a 29% decline in November and a 53% drop in October.
In Japan, auto sales fell 3.4%, the fourth straight monthly decline. But the drop was less sharp than auto makers
had expected, and much less severe than the double-digit slump that occurred when a government subsidy
program ended a few years ago.

Sales of new cars, trucks and buses dropped to 214,429 vehicles last month, the Japan Automobile Dealers
Association said Monday. Sales had declined 3.3% in November, 9% in October and 8.1% in September.
Toyota President Akio Toyoda, who is chairman of the Japan Automobile Manufacturers Association, said the
impact of the subsidies' expiration looked limited.
Some Japanese car makers rolled out new models in recent months to offset the effect of the government in
September ending its subsidy program. Such efforts by auto makers may have helped avoid the kind of 30%
plunge that occurred after a similar government program expired in 2010.
Nissan's Mr. Shiga said he was concerned that solid demand for new cars hadn't spilled over to existing models.
That could cut into sales later, once new-model introductions slow.
Toyota's Japanese sales fell 3.4% last month, though sales of its upscale Lexus brand rose 32%. Nissan's sales
declined 8.9%. Honda's sales fell 39% amid a lack of new models as the company focused on minivehicles.
-- Yajun Zhang in Beijing, Colum Murphy in Shanghai and Yoshio Takahashi in Tokyo
Document J000000020130108e9180002d

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Ford Shift Shows New Power of Car Centers .................................................................................................................

Corporate News: Ford to End Production In Australia ....................................................................................................9

Corporate News: Former Ford Executives Indicted in Argentina ..................................................................................10

FOR DETROIT AUTOWORKERS, A SHORTER SUMMER SHUTDOWN ..................................................................11

Some European Pain Relief for GM and Ford...............................................................................................................15

Tailgate Party: Fire Up the Grilles .................................................................................................................................16

Pickups: America Falls Back in Love ............................................................................................................................23

Trying to Be Hip and Edgy, Ads Become Offensive ......................................................................................................25

U.S. Car Makers Are Missing in India ...........................................................................................................................27

Joe Wang: Understanding the goal is important ...........................................................................................................34

Ahead of the Tape .........................................................................................................................................................39

Companies Feel Pinch On Sales In Europe ..................................................................................................................41

The Secret Ingredient Is Ford Fusion ............................................................................................................................43

A Troubled Introduction for a Crucial New Model..........................................................................................................45

Autos: Ford Thrives at Home, Drags in Europe ............................................................................................................47

North American Sales Lift Ford's Results......................................................................................................................51

CFO Journal: The Big Number ......................................................................................................................................53

Ford-G.M. Teamwork On Transmissions ......................................................................................................................54

GM, Ford team to develop 10-speed transmissions ; Teamwork saves money............................................................58

Corporate News: GM, Ford Team Up on New Transmissions ......................................................................................62

The 97-Month Car Loan ................................................................................................................................................67

Police Car Company Abandons Offices ........................................................................................................................69

Automakers pick up speed after long slog ....................................................................................................................71

Corporate News: Battery Fires Fail To Rattle Car Makers ............................................................................................74

Another Sport Franchise for Ford ..................................................................................................................................80

Lawsuit alleges older Fords susceptible to sudden acceleration ..................................................................................82

Detroit: Lean Into Car-Market Turn ...............................................................................................................................89

A Chase Car to Lure Private Eyes Out of Retirement ...................................................................................................91

Corporate News: Ford Boss's 2012 Pay: $21 Million ....................................................................................................93

Employers Blast Fees From New Health Law ...............................................................................................................94

Detroit Metal Largely Absent At Swiss Show ..............................................................................................................101

Toyota's Bottom Feeder Finally Makes Some Waves.................................................................................................102

Ford Recalling Minivans For Corrosion Problem.........................................................................................................104

Ford Foundation Head Steps Down ............................................................................................................................106

Corporate News: Car Sales Rise but at a Slower Pace ..............................................................................................107

A High-Dollar Debutante Ball ......................................................................................................................................109

Ahead of the Tape .......................................................................................................................................................111

Page 2 of 194 © 2020 Factiva, Inc. All rights reserved.

A Hatch Marinated in Hot Sauce .................................................................................................................................119

Sign of a Comeback: U.S. Carmakers Are Hiring .......................................................................................................121

Corporate News: Lexus, Porsche Top Quality Survey ................................................................................................123

Companies Fret Over Uncertain Outlook ....................................................................................................................130

Ford to Sell Plug-Ins At More Dealerships ..................................................................................................................132

Apple's New Normal ....................................................................................................................................................135

Low Rates Force Companies To Pour Cash Into Pensions ........................................................................................137

Automakers Join Forces On Fuel-Cell Cars ................................................................................................................140

Europe's Car Woes Damp 2013 Outlook ....................................................................................................................142

Ford extends profit streak despite big Europe loss .....................................................................................................146

Toyota Takes Sales Crown .........................................................................................................................................149

Corporate Watch .........................................................................................................................................................151

Ahead of the Tape .......................................................................................................................................................153

EARNINGS SEASON ; RESULTS STILL UPBEAT ....................................................................................................158

Any Engine You Like, But Only if It's a Hybrid.............................................................................................................159

New Era for European Autos.......................................................................................................................................172

Detroit Auto Show: Denso Set To Expand American Operations ...............................................................................175

VC Dispatch / U.S. Venture-Capital Financings ..........................................................................................................178

Page 3 of 194 © 2020 Factiva, Inc. All rights reserved.

Detroit Sheds Pounds For Gas-Mileage Gains ...........................................................................................................181

Industry's New Year Buffet: Entrees and a Few Desserts...........................................................................................183

A Glimpse Into the Future of Parking ..........................................................................................................................185

Ford Plans To Hire 2,200 Salaried Workers In U.S.....................................................................................................187

For Sale: Used Ford, Careful Owner ...........................................................................................................................188

Story stocks .................................................................................................................................................................189