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Automakers paying Chinese dealers for lower-than-expected sales

The Chinese dealers vs. foreign manufacturers story won't quit. It began with a story on the struggles faced by FAW-Toyota joint venture dealers, with supposedly 95 percent of the showrooms losing money, and 10 percent of them doing so poorly that they'd have to exit the business. The problem is mandated sales targets, most set when the country's economy was racing. Now that things have slowed, China's dealers are swimming in unsold cars and the costs to keep them. In the case of FAW-Toyota, dealers asked Toyota to hand over 2.2 billion yuan ($355 million) to help address the situation. That was followed by a report noting the issues that Honda, BMW, and Nissan dealers are having with the same issue, revealing that the Chinese Automobile Dealers Association (CADA) had taken the highly unusual step of writing to the Chinese government to complain. Now Reuters reports that CADA is not only pressing its case even harder, it's being open about it: it announced that BMW agreed to pay dealers 5.1 billion yuan ($820 million) to alleviate poor profits last year. Unnamed sources said Audi has thrown 2 billion yuan into the kitty for subsidies, and Daimler has contributed "about 1 billion yuan" to its dealers. The battle isn't just about 2014, but how business will be run in 2015 as well: Chinese Porsche dealers have requested the automaker lower its 2015 target of 64,000 cars, which would be a 40-percent increase on its 2014 sales of 46,931 vehicles. One analyst called it "shocking" that the CADA has taken its fight public, while CADA comments continue to imply that dealers have been railroaded to the cliff's edge without recourse. "Due to the difference in status," it's deputy secretary said, "individual dealers are not willing to, or don't dare to, talk frankly with the carmakers...." Both parties need one another, so they'll figure out a way to make it work – but that could mean acknowledging the Chinese market is behaving more like a mature one, not an emerging one. News Source: ReutersImage Credit: Lintao Zhang/Getty Images Earnings/Financials Audi BMW Porsche Toyota Car Dealers Luxury

Audi debuts all-new R18 E-Tron Quattro with novel secondary hybrid system

This is the new Audi R18. It looks like the Bond villain of race cars (it has red running lamps), and if Audi's past is any indication, it'll prove difficult to beat in the LMP1 class of the 2014 World Endurance Championship.
The car's full name is the Audi R18 E-Tron Quattro, just like last year's car. Also like last year's car, the new R18 draws its power from a V6 turbodiesel, which powers its rear wheels, and Audi's E-Tron hybrid system, which runs its front axle. Unlike last year's car, though, this R18 has a secondary hybrid system. Audi has fitted the V6 with an electric turbocharger and figured out how to capture waste heat generated when the engine reaches its boost limit. That power can then be stored and fed back into either the turbo or the front axle's hybrid system under acceleration.
There are a number of changes to the body on the new car, forced in large part by series regulation changes. The car is narrower, particularly at the front, but it's also taller. The front end is set off by a new wing, as part of a new WEC regulation. Audi seems quite pleased about this, citing an improvement in front-end downforce and a reduction in cost. Like Formula One, the WEC contenders now have to contend with a ban on the so-called blown diffuser, which forced exhaust gases over the diffuser, creating downforce. That's necessitated some changes from Audi, although as we have no rear shots of the car, we can't tell you what it looks like.

Audi A5 and S5 freshen up for 2017

UPDATE: A previous version of this story mischaracterized the 2017 S5's engine configuration. The article has been updated. Well, here's the new Audi A5 and S5. They look a lot like the old ones, but just a tiny bit better. In other words, the redesigned coupes received the same treatment as their four-door counterparts, the A4 and S4. While the German press materials mention both gas and diesel engines, we expect the A5 to carry on in the US with petrol power only. Like the current A5, a 2.0-liter, turbocharged four-cylinder will serve as the base engine, but will probably get a similar power bump as the A4 – Audi hasn't released official figures yet. The four-door had its base output bumped from 220 horsepower and 258 pound-feet of torque to 252 hp and 273 lb-ft of torque. The S5 is a more interesting proposition than the S4. Where the old S5's 3.0-liter, supercharged V6 produced 333 hp and 325 lb-ft of torque, the new, turbocharged, 3.0-liter six-cylinder pumps out 354 ponies, according to the global press materials. That figure, fans of the old 4.2-liter V8-powered S5 will note, is identical to the original S5 that came out for model-year 2008. Torque figures aren't available yet, but we'd bet on at least a small increase in torque. Still, the increase in power is good for a 4.7-second run to 62 miles per hour, a 0.2-second improvement over the current car's 0-60 time. Audi claims it will offer the A5 with both six-speed manuals and seven-speed dual-clutch transmissions, but we wouldn't be so sure about that stick here in the US. The only available gearbox on the A4 is a seven-speed S-Tronic – coupes are inherently more sporting than sedans, but we aren't sure that's justification for Audi to offer a manual-trans A5 here in the US. Audi only mentions an eight-speed automatic for the S5. So no, the German press materials aren't a good indicator of the US-market A5. What we can rely on, of course, are the official images. The original A5/S5 was a handsome car, but Audi's designers have done a swell job styling the 2017 model. It looks good, and is somehow even more refined than last year's car. Audi's new corporate grille works well on a coupe body, although the powerful creases in the hood might be a little too powerful. The tail is lovely, like a prettier A3. The bodies are better looking, but they're also lighter and more aerodynamic, too. The A5's coefficient of drag is down to a slippery 0.25, while Audi's engineers lipo'd 132 pounds of fat.