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FCA-Renault merger faces tall odds delivering on cost-cutting promises

FRANKFURT/DETROIT — Fiat Chrysler Automobiles and Renault promise huge savings from a mega-merger, but such combinations face tall odds because of the industry's long product cycles and problems translating deal blueprints into real world success, industry veterans told Reuters. BMW's 1994 purchase of Rover, and Daimler's 1998 merger with Chrysler both made sense on paper. The companies promised to hike profits by combining vehicle platforms and engine families. Both combinations proved unworkable in reality, and were unwound. Renault and Nissan, which have been in an alliance since 1999 designed to share vehicle components, have only managed to use common vehicle platforms in 35% of Nissan's products despite an original target of 70%, according to Morgan Stanley. FCA and Renault have raised the stakes for themselves by ruling out plant closures. That increases the pressure to achieve more than $5 billion in promised annual savings from pooling procurement and research investments. The two companies have yet to fill in many of the blanks in the merger plan put forward by Fiat Chrysler. Renault's board is expected to act soon to accept the proposal, but that would lead only to a memorandum of understanding to pursue detailed operational and financial plans. A final deal and the legal combination of the two companies could take months to complete if all goes well. Pressure to cut automotive pollution is driving the latest round of consolidation. Automakers are looking at multibillion-dollar bills to develop electric and hybrid cars and cleaner internal combustion engines. Fiat Chrysler and Renault are betting they can design common electric vehicle systems, then sell more of them through their respective brands and dealer networks, cutting the cost per car. Developing all-new electric vehicles can bring more opportunities to share costs from the outset, industry experts said. "With the emergence of connected, autonomous, electric and shared vehicles, carmakers face immediate investments, so new opportunities for sharing costs have emerged," said Elmar Kades, managing director at Alix Partners. However, most electric vehicles lose money. This is a challenge for city car brands in Europe in particular. Both Renault and Fiat rely heavily on this segment for sales.

2022 Mitsubishi Outlander Luggage Test | Three rows, two tests!

Well, this is a first. Normally, three-row vehicles are so enormous that doing a luggage test with the third row lowered is a total "no kidding" proposition. I'd run out of stuff in my garage long before I'd fill up a Kia Telluride. As such, I only test the space behind the raised third row of three-row SUVs because that can actually be some useful information. The 2022 Mitsubishi Outlander is not a typical three-row SUV, however. It's one of only two SUVs in the compact segment, along with the Volkswagen Tiguan, that offers a third-row seat. As I've already demonstrated, it's not much a seat, but its presence and the need to accommodate it does mean the Outlander has one of the largest cargo volumes in the compact segment.  As such, what we're getting here is the first Double Luggage Test© whereby I'll be treating the Outlander like both a compact SUV and a three-row one, testing it with both the third row raised and lowered. Right!? Pretty damned exciting.  Test 1! Here's what you get with third row raised. On paper, Mitsubishi says this is 11.7 cubic-feet, which is indeed the smallest three-row number I've come across while luggage testing. Congratulations Cadillac XT6, you're no longer last! Wait, hold that thought ... Thanks to those comically tall head restraints and the Outlander's D pillar shape, I could actually safely place the fancy bag on top without it flying forward or excessively blocking rearward visibility (the two reasons I don't load to the roof in these tests). You can see that visibility below right. Below left you can see the 12.6-cubic-foot Cadillac XT6, which could not fit the fancy bag as such (though, obviously, you could fit something). So, sorry XT6, you're in last again. Mwa mwa.  Ah, but what about under-floor space. There's indeed some available. It houses the cargo cover encased in a foam mold that also houses those comically tall headrests when not in use. Remove it all, and there is a decent amount of extra space unearthed, which could theoretically free up some extra space if you left the rigid floor open. That's not the same as vehicles like the Honda Pilot and Kia Telluride, though, which more obviously intend you to use the under-floor space in such a manner.  Test 2! With the third-row lowered and the second-row reclined to a natural position, this is the space available. The specs say it's 33.5 cubic-feet, which falls short of the class-leading Honda CR-V (39.2), Toyota RAV4 (37.5) and Hyundai Tucson (38.7).

Mitsubishi Outlander PHEV now for real due in 'late summer, early fall'

Any day now, American plug-in vehicle shoppers will be able to actually buy a plug-in hybrid SUV. Europeans and Japanese buyers have had this option for many years, since the Mitsubishi Outlander PHEV went on sale in those markets in 2013. There have been plenty of diversions in the route that is bringing the big PHEV to our shores, but it's looking like, "late summer, early fall," is when thing will for real happen. 10-20 percent of total Outlander sales would be "a very good number." That's the message from Don Swearingen, executive vice president of Mitsubishi Motors North America (MMNA), who we spoke to at the New York Auto Show where the PHEV made its debut appearance. Swearingen said that the dealers are as ready as the customers. "As we talked to our dealer council, they are all very interested in this product," he said. "[Range anxiety was] eliminated with this vehicle, and because of that, I think we are going to have some pretty good response." Swearingen didn't put a specific number to that claim, but said that 10-20 percent of total Outlander sales (which currently sit at around 2,000 a month) would be "a very good number." Previously, Mitsubishi representatives said they expected to sell 4,000 PHEV units in the first year. As we've documented over the years, there were a number of reasons for why the US didn't get the first batch of Outlander PHEVs. One of the big ones was that the PHEV was selling like gangbusters elsewhere. It's the best-selling PHEV in all of Europe, for example, and was the fourth-best-selling plug-in vehicle anywhere in February 2016. And Mitsubishi just couldn't make enough of them. Swearingen said the main bottleneck for this was the battery pack supplier Lithium Energy Japan, which didn't have the capacity to make more than it did. So, instead of leaving three markets without enough supply, Mitsubishi decided to leave one in the lurch and focus on the other two. Plus, since the Outlander PHEV will be based on the 2017 gas-powered Outlander, it will come with numerous safety enhancements as well as the 100+ improvements that the 2016 Outlander got compared to the 2015. In other words, all the pieces are all coming together. The Outlander PHEV is "the best of both worlds." - Francine Harsini At least, that's what Francine Harsini, MMNA's senior director of marketing, said. The final important part are the customers, and Harsini said that Mitsubishi will be a big national marketing push. The general theme?