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plus 3, Canadian Auto Sales Expected To Grow In 2010 - Industrial Distribution

plus 3, Canadian Auto Sales Expected To Grow In 2010 - Industrial Distribution

Canadian Auto Sales Expected To Grow In 2010 - Industrial Distribution

Posted: 29 Jan 2010 07:52 AM PST

TORONTO (CP) -- Resource-rich Alberta and British Columbia will lead the rebound in car and light truck sales in Canada this year, a new report predicted Friday.

Higher oil prices in Alberta are expected to boost car and light truck sales to an annualized 198,000 units in that western province, up from 184,000 in 2009, Scotiabank said in its Global Auto Report.

In addition, the bank predicts purchases in British Columbia, where the Winter Olympics and strong energy markets are boosting the economy, will rise to 158,000 this year from 150,000 units in 2009.

Overall, the bank said global car purchases surged 22 percent year-over-year in December. Meanwhile, North American sales ended 2009 on a strong note, enabling automakers to enter 2010 with renewed confidence.

Senior economist Carlos Gomes said the bank expects Canadian purchases to climb to 1.53 million units in 2010, up from a decade low of 1.46 million last year.

In 2009, weak consumer confidence and tight credit markets that made it more difficult to finance vehicle purchases squeezed the car sales market across North America. However, economic conditions are improving and the U.S. and Canadian economies are recovering from the painful recession.

"In Canada, car and light truck sales climbed above a year earlier in December, the first increase since October 2008, before the sharp fall-off in global economic activity," said Gomes, a senior economist at Scotiabank.

In breaking down provincial car sales prospects, Scotiabank said:

-- Alberta led the downturn in 2009, but is expected to outperform this year, as higher oil prices lift car and light truck sales. Oil and gas drilling, the key driver of economic activity and vehicle sales in the province, bottomed last summer, and is up nearly 20 percent year over year in the early weeks of 2010.

-- Car purchases in British Columbia will be bolstered by the Winter Olympics and Paralympic Games. Vehicle sales in British Columbia have dropped a cumulative 25 percent since the 2007 peak of 198,000 units, including a 15 percent slump in 2009 to 150,000 units, but are expected to increase to 158,000 this year.

-- Saskatchewan's vehicle sales have also started to rebound from an eight percent decline in 2009, and are expected to total 46,000 units in 2010, up from 44,000 last year. Growth in the prairie province has outpaced the national average for the last three years.

-- Sales in Manitoba are expected to climb to 45,000 units in 2010, from 43,000 last year, as the province benefits from ongoing infrastructure projects, such as the expansion of the Winnipeg airport and construction of the Waskwatim hydro-electric dam.

-- Ontario's car sales are expected to climb to 557,000 units in 2010, up from 535,000 last year. Sales will be bolstered by the end of a four-year cyclical decline in North American vehicle output, as sales bounce back in the key U.S. market.

Ontario, the centre of Canada's auto assembly sector, is also recovering from a streamlining of its manufacturing, automotive and forestry sectors during the recession.

-- Car and light truck sales in Quebec will increase a moderate three per cent in 2010 to 402,000 units, as the province has more new vehicles than other parts of the country.

In addition, while the hard-hit sectors in other provinces have started to rebound, the downturn in the global aerospace sector is still putting downward pressure on the province's largest manufacturing industry.

The Montreal area is home to big aerospace companies such as aircraft maker Bombardier, jet engine builder Pratt & Whitney Canada and pilot training technology company CAE Inc.

- In Atlantic Canada, higher base metal prices have encouraged mine operators to ramp up production in Newfoundland and Labrador, helping to lift sales in the region to 119,000 units this year, up from 115,000 in 2009.

Construction projects, including the building and renovation of sports arenas in preparation for the 2011 Canada Winter Games in Halifax, will boost auto sales in Nova Scotia. As well, the province will benefit from a thriving finance, insurance and real estate sector in Halifax.

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Weekend auto show revs up - Charleston Daily Mail

Posted: 29 Jan 2010 07:30 AM PST

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Bright’s IDEA to hit truck market in 2013 - Fleet Owner

Posted: 29 Jan 2010 08:06 AM PST

WASHINGTON D.C. The IDEA, a new aerodynamically shaped plug-in hybrid vehicle (PHEV) delivery van concept developed by Bright Automotive, aims to have its prototype ready for production in the first quarter of 2013, the company said. (View photos of the new vehicle)

The sleekly-styled van, first introduced in April 2009, recently received a technology upgrade so it can deliver 40 mi. of all-electric range and nearly 40 miles per gallon (mpg) operating in standard hybrid mode, Lyle Shuey, Bright's vp-marketing & sales, told FleetOwner here at the Washington Auto Show. (View video of the vehicle)

He noted that each IDEA van should save the typical commercial or government fleet 18 cents per mile, reduce gasoline use by 1,500 gal. per year, and reduce carbon-dioxide (CO2) emissions by 16 tons per year.

Paul Bishop, manager of Bright's development test lab, said the driving concept behind the IDEA is to combine off-the-shelf standard components – a standard 4-cylinder light truck gasoline engine, electric motor, battery pack – with new designs, such as an aerodynamic all-aluminum body with a drag coefficient of just 0.3, along with the use of carbon fiber and recycled materials to further reduce vehicle tare weight.

"The target weight of our van concept is about 3,200 lbs. – that's almost half of what a standard van this size weighs," Bishop told FleetOwner. "Even with the battery pack adding 200 to 300 lbs. to the vehicle, we can still offer payload capacity of 2,000 lbs."

The recent upgrade to the IDEA is a 13 kilowatt-hour (kw-h) battery pack, which allows the van to operate for 40 mi. in electric-only mode, and then switch to a "standard hybrid" mode, with the gasoline and electric motor working together to achieve a minimum of 36 mpg when the vehicle is empty, compared to the standard 8 to 12 mpg most vans in this class achieve, Bishop said.

One unique feature is a passenger seat that folds up into a work station even with the driver's midsection. "Our research found that the passenger seat only got used 1% to 2% of the time, so we added this feature to take advantage of that underused space," he noted.

Other interesting specifications include a 70/30 split rear door assembly, so opening the entire cargo bay won't obscure the driver's rear view mirror. "That's a safety feature our research indicated van drivers needed," Bishop explained.

Anderson, Indiana-based Bright launched in January 2008 with the help of the Colorado-based Rocky Mountain Institute and is staffed with veterans of the automotive industry, including John Waters, Bright's CEO, who developed the battery pack for the General Motors EV1.

Bishop noted the company's goal is launch pilot tests of the IDEA van in the coming year, with the first quarter of 2013 the target for building production-level vehicles.

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Toyota recall launches CTS out of obscurity - USA Today

Posted: 29 Jan 2010 06:33 AM PST

CTS (CTS), a global operation that supplies the pedals to Toyota (TM), isn't even the top dog in the arcane world of accelerator pedal suppliers. It holds less than 20% of the global market for such assemblies, behind pedal makers Denso and Hella.

Do a Google search for CTS, and it's as likely to return the Cadillac CTS model (no connection) as the parts supplier.

At the moment, though, you'd think nobody else ever made a gas pedal, and that CTS did nothing but.

All the Toyota vehicles in the pedal recall have CTS assemblies, a fact widely published and discussed. In just a week, CTS has become so synonymous with sticking gas pedals that a Chinese company suspended production of a commercial van because it has CTS-made pedals — but not the Toyota design. No accidents, no complaints; just in case, said China's Jiangling Motors, which has made just 1,663 of the vans in a venture with Ford Motor.

Nevertheless, Toyota's recall of 2.3 million vehicles in the U.S. on Jan. 21, 75,000 Toyota RAV4s in China on Thursday and a yet-to-be-specified number of Yaris sedans in Europe have put CTS in a global spotlight. And it worries about public confusion that it might be somehow involved in Toyota's recall of 5.4 million vehicles for acceleration issues related to floor mats, though it is not.

Sour stuff for the company, which was founded in 1896 as Chicago Telephone Supply and still counts communications as one-fifth of its business.

Most of its revenue comes from things that, like pedal modules, mostly escape notice. Electronic test equipment, sensors and "actuators." Things with eye-glazing names: piezoelectric ceramics, heat sinks, RF filters, all manner of electromechanical devices.

Pedal assemblies are an electromechanical device. A sensor turns the mechanical pedal's motion into an electronic signal that tells the car's computer how much gas to give the engine. "Drive by wire," it's called; it's ubiquitous in modern cars.

The Toyota recall involves the mechanical part, not the electronics. Moisture, age and wear appear to be an evil alchemy that can make it stick, Toyota says. It can't duplicate the fault on new, dry assemblies.

Headquartered in Elkhart since 1902 and winner in recent years of supplier quality awards from Toyota and Honda (it also makes pedals for Honda, Mitsubishi, Nissan and Chrysler), CTS is so diversified that the auto business now causing it such a headache is less than 30% of its revenue. Toyota — which CTS calls "a small but valued customer" — is just about 3% of sales.

On Thursday, as the company's officers tried to discuss its earnings (up and improving) with analysts and reporters, they were bombarded with Toyota pedal questions. CEO Vinod Khilnani patiently went through the situation and impact: "When the dust settles and people absorb all the news, this will not have any significant financial impact" on CTS.

Why not?

•Toyota's paying for the recall. "It's our responsibility," Toyota spokesman Brian Lyons has said repeatedly.

•The recall means more business in the short run and improved manufacturing processes.

"I will confirm that three of our plants, as we speak, are producing the new pedals to meet Toyota's demand," Khilnani said. "We have Toyota people in our factories working with us to see how fast we can ramp up production" by removing bottlenecks in the process.

That means CTS will emerge from the cloud with production methods improved by Toyota, widely regarded as at the top in efficient assembly.

•Working through the recall could strengthen ties to Toyota. By acting as a partner — helping design a replacement pedal assembly, for one — rather than as an adversary, CTS could earn more Toyota business. "That is right," Khilnani said when asked about that possibility.

The infamous example of companies approaching a recall as adversaries is the Ford-Firestone recall in 2000 involving Explorer SUVs with Firestone Wilderness tires. The companies blamed each other openly and loudly. Much of their managers' and engineers' time was spent giving lawsuit depositions. Crash victims' lawyers gleefully exploited the enmity for settlements.

Manufacturing sourced out

Automakers generally don't like to focus on their suppliers, or even identify them. It ruins the image of the giant car company in control of its fate, forging and stamping and extruding parts, then assembling them into cars and trucks.

"I ask people, 'Does Toyota manufacture anything?' And everybody raises their hands and says, 'Yes.' But Toyota" doesn't, says Joel Sutherland, managing director of Lehigh University's Center for Value Chain Research. "No car company, in fact, manufactures anything. It assembles things."

As Toyota did with the pedal mechanisms, automakers "design and engineer the (components), and then source them out, from fenders to electronics," says Sutherland.

He worked 11 years as vice president of operations at component-supplier Denso's U.S. unit, then as president at Air Road Express, a component hauler.

Denso was closely tied with Toyota, so Sutherland believes he got a full dose of Toyota culture, in particular, and the industry supply chain in general.

Automakers say to suppliers bidding for their business, "Here's the idea. You need to work with our engineers to design the components," Sutherland says. "Some are standard, such as wiper motors, for instance. And then you get into custom components, such as air conditioning."

Automakers often fashion their own body panels. And they usually manufacture their own engines, but the accessories attached to them — power-steering pumps and alternators, for example — come from suppliers.

Even such elementary components as frames can come from outside suppliers.

The role of the car company increasingly is that of overseer of the process. Only when something goes wrong, when an automaker has to notify the National Highway Traffic Safety Administration of a pending recall, does it necessarily have to identify who made a particular part.

CTS in the spotlight

That's how the world came to know CTS.

It was identified in the Jan. 21 recall notice to NHTSA as maker of the pedal assemblies that can wear prematurely and stick open, leaving the engine racing, after the driver lets up.

Almost never happens, both Toyota and CTS say. In fact, CTS says that of 1.4 million pedal assemblies Toyota monitored, 12 had issues, only eight of those were sticking problems — and none of those was severe enough that the throttle pedal actually stuck open. It was simply slow to return to idle.

Still, reports of a fatal crash in Texas last month and a New Jersey motorist who drove to a dealership when his engine wouldn't slow after he lifted his foot, prompted NHTSA to assign investigators and warn Toyota it was about to launch an official probe. The recall, a voluntary move by Toyota, followed quickly.

The large number of vehicles involved, and Toyota's sheer size among car companies — No. 1 worldwide — prompted extraordinary attention. Attention CTS neither wanted nor needed.

But it's part of doing business with the biggest car company — and one till now known mainly for not making such mistakes.

"When Toyota passed General Motors as the No. 1 (auto company), I said then, 'They'll probably miss being No. 2,' " says James Bell, executive market analyst at industry monitor kbb.com. "Being No. 1 really brings a lot of extra scrutiny."

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