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Trucks, SUVs drive U.S. October new vehicle sales

DETROIT — Major automakers posted mixed U.S. new vehicle sales in October on Wednesday, though America's love affair with high-margin pickup trucks and SUVs remained in full bloom as larger, pricier vehicles fared better than passenger cars. Auto industry publication WardsAuto put the seasonally-adjusted annualized rate (SAAR) for light vehicle sales in October at a robust level of 18 million units. But after a long boom cycle, carmakers are still ill-prepared for the slight decline in sales anticipated for full-year 2017 and have taken too few steps to trim production, said Doug Mehl, a partner in consultancy A.T. Kearney's automotive practice. "When you make a new vehicle, you have volume assumptions tagged to it, and who wants to be the guy who says, 'I'm going to make less of this really cool model'?" Mehl said. "But eventually the market is the reality, and it's going to force companies one way or other here." General Motors GM reported a sales drop of 2.2 percent for the month, with consumer sales down 6.6 percent. But sales of high-margin pickup trucks, sport utility vehicles and crossovers all rose. GM also cut its inventory of unsold vehicles — a source of concern for the market — slightly. The automaker has worked to reduce its volume of excess inventory, including through significant production shutdowns in the third quarter. GM had said its inventory would rise in October. "We are heading into the fourth quarter with good momentum, thanks to a strong U.S. economy and very strong pickup and crossover sales," said Kurt McNeil, GM vice president for U.S. sales operations. GM slightly reduced consumer discounts as a percentage of average transaction prices to 13.5 percent, from 13.7 percent in the third quarter. Industry experts believe consumer discounts above 10 percent of the average transaction price are unhealthy as they erode resale values and are unsustainable in the long term. Consultants J.D. Power and LMC said last week that based on preliminary October sales numbers, discounts have exceeded 10 percent in 15 of the past 16 months. Ford The U.S. auto industry posted record sales of 17.55 million vehicles in 2016. New sales received a strong boost in September as consumers replaced vehicles damaged in southeast Texas by Hurricane Harvey the previous month. Full-year 2017 sales are expected to be slightly lower than 2016.

Fiat Chrysler and PSA boards sign off on merger

MILAN — The boards of French carmaker PSA, the owner of Peugeot, and Fiat Chrysler in separate meetings on Tuesday approved a binding agreement for a $50 billion merger, sources said. The two midsized carmakers announced plans six weeks ago for a tie-up to create the world's No. 4 carmaker and reshape the global industry. A merger is seen helping them deal with big challenges in the industry, including a global downturn in demand and the need to develop costly cleaner cars to meet looming anti-pollution rules. Both companies declined to comment. A source close to FCA had said earlier the two companies could formally announce the agreement early on Wednesday, followed by a conference call to explain further details later in the day. China's Dongfeng Motor Group, which now has a 12.2% equity stake in PSA, will have a reduced stake of around 4.5% in the merged group, two sources said, in a move that could help make regulatory approval easier. According to the deal approved by PSA's board on Tuesday, FCA's robot unit, Comau, will remain within the combined group rather than be spun off as was originally planned in October, the sources said. The new group will evaluate how to extract value from Comau. Ahead of the meetings, entities representing the Peugeot family, Etablissements Peugeot Freres (EPF) and FFP, unanimously approved a proposed memorandum of understanding for the planned merger, a source familiar with the situation said. FCA and PSA are expected to finalise a deal by the end of 2020 to create a group with 8.7 million annual vehicle sales, a source said. That would put it fourth globally behind Volkswagen AG, Toyota and the Renault-Nissan alliance. It was only six months ago that FCA abandoned merger talks with PSA's French rival Renault. FCA would gain access to PSA's more modern vehicle platforms, helping it meet tough new emissions rules, while Europe-focused PSA would benefit from FCA's profitable U.S. business featuring brands such as Ram and Jeep. However, the deal could still face close regulatory scrutiny, while governments in Rome, Paris and unions are all likely to be wary about potential job losses from a combined workforce of around 400,000. PSA's Carlos Tavares will be chief executive and FCA's John Elkann — the scion of Italy's Agnelli family, which controls FCA through their holding company Exor — chairman of the combined company.

Junkyard Gem: 2012 Fiat 500 Pop

FCA just announced that the Fiat 500 hatchback and convertible get the US-market axe after this year, not even a decade after the car reintroduced us to the Fiat marque. I've been seeing crashed 500s in big American wrecking yards for years now, but now some non-crunched examples are showing up on my junkyard journeys. I decided that I'd commemorate the rise and fall of the 500 by photographing this giallo 2012 500 Pop, found in Denver. According to an industry person who wishes to remain anonymous, Fiat was short on automatic-equipped 500s for 2012 (the first model year of North American sales), so a few hundred of the early Pop-trim-level cars got yellow or red paint and these black stripes and badging to help them move off the showroom floors despite their sales-killing third pedals. Soon after, the Fiat 500 Stinger appeared. I don't know why anyone wouldn't have preferred this car with the manual transmission, but reality dictates that little economy cars with three pedals can be virtually unsellable once they get some miles on the clock. This 500 has some body damage (that might have happened after it got to the junkyard) but looks pretty clean overall. Sold new in Colorado, will be crushed in Colorado seven years later. The Multi-Air four-banger in the '12 500 generated 101 horsepower, which wasn't much for a 2,500-pound car (by 21st-century standards). For commuting purposes, though, it was fine, and the 5-speed made it reasonably fun. Pop was the cheapest trim level for the 2012 500, so the interior didn't offer much snazz beyond the body-colored dash panels. Now that these cars have become so cheap, it's time to consider the most crazy-per-dollar junkyard engine swaps for them. Think a narrow-angle turbocharged V6 would fit in a 500? This content is hosted by a third party. To view it, please update your privacy preferences. Manage Settings. The next wave of Italians has come to America … and they've come to party.