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BMW, Toyota warn about Chinese market slowing down

BMW and Toyota are the latest automakers to become concerned about the closing throttle on the once rapidly accelerating vehicle market in China. There might be drastic effects on their ledgers at the end of the year. With the Chinese stock market no longer looking so healthy, the people just aren't buying as many new cars as in the past. Things got really bad in June after the first drop in deliveries in two years. BMW has already reduced Chinese production by 16,000 units so far this year. Despite the slowdown, the company has kept a brave face. "We experience that volatility in all emerging markets," BMW CEO Harald Krueger said in a conference call, according to Automotive News. The problem for Toyota is a bit stranger. Through July, the automaker's Chinese deliveries were actually up 12 percent. However, the gain was offset by falling sales prices. "This is making our business in China quite difficult. The business environment is getting tougher," Toyota Managing Officer Tetsuya Otake said, Automotive News reported. Much of the weakness in China has come in the middle part of the year, and from January through June deliveries were still up 8.4 percent. This means the effects haven't hit the financial results of some automakers too hard quite yet. In the second quarter, General Motors referenced the "challenging conditions" there but still posted a growing net income of $1.1 billion. Despite falling global sales, Toyota managed record income for the quarter, too.

Tougher than steel: Wood pulp could make lighter auto parts

KYOTO, Japan — The global push among carmakers to make ever lighter vehicles is leading some auto suppliers in Japan to turn to what seems like an unlikely steel substitute — wood pulp. Japanese researchers and auto component makers say a material made from wood pulp weighs just one-fifth of steel and can be five times stronger. The material - cellulose nanofibers — could become a viable alternative to steel in the decades ahead, they say, although it faces competition from carbon-based materials, and remains a long way from being commercially viable.> Related: Jay Leno drives the Renew cannabis car — hemp you can't dent Reducing the weight of a vehicle will be critical as manufacturers move to bring electric cars into the mainstream. Batteries are an expensive but vital component, so a reduction in car weight will mean fewer batteries will be needed to power the vehicle, saving on costs. "Lightweighting is a constant issue for us," said Masanori Matsushiro, a project manager overseeing body design at Toyota. "But we also have to resolve the issue of high manufacturing costs before we see an increased use of new, lighter-weight materials in mass-volume cars."A NEW PROCESS Researchers at Kyoto University and major parts suppliers such as Denso Corp, Toyota's biggest supplier, and DaikyoNishikawa Corp, are working with plastics incorporated with cellulose nanofibers — made by breaking down wood pulp fibers into several hundredths of a micron (one thousandth of a millimeter). Cellulose nanofibers have been used in a variety of products ranging from ink to transparent displays, but their potential use in cars has been enabled by the "Kyoto Process," under which chemically treated wood fibers are kneaded into plastics while simultaneously being broken down into nanofibers, slashing the cost of production to roughly one-fifth that of other processes. "This is the lowest-cost, highest-performance application for cellulose nanofibers, and that's why we're focusing on its use in auto and aircraft parts," Kyoto University Professor Hiroaki Yano, who is leading the research, told Reuters in an interview. The university, along with auto parts suppliers, are currently developing a prototype car using cellulose nanofiber-based parts to be completed in 2020.

Toyota Camry incentives and fleet sales cranked to keep sales crown, insiders worried

We've been watching for some time now as Toyota has piled more incentives on the hood of its Camry sedan, and Automotive News reports that the we're not the only ones with raised eyebrows. The current Camry hasn't even been on the market for two years, but the family sedan segment is more hotly contested than it has been in years. It's that high level of competition that has led the automaker to uncharacteristically add more money on the hood in order to assure it maintains its long-held title of America's Best-Selling Car, a mantle it has owned for a dozen years. It's ramping up fleet sales, too.
According to the analysts at TrueCar, Toyota has bumped incentives per unit every month this year, now totaling some $2,750 as of May, a 38-percent hike over this time last year. That's more spiff money than the segment's other best sellers, the Nissan Altima ($2,400), Ford Fusion ($2,300) and Honda Accord ($1,400), all of whom have actually decreased their incentive spend by 20- to 40-percent over the same period.
The ramp up in incentive spending and fleet sales has analysts concerned that Toyota will tarnish the Camry's historically sterling resale value. ALG pegs the 2013 Camry's current 36-month residual value at 54.4 percent, well ahead of the segment average's 50.9 percent (but shy of the Accord's 55.6 percent). However, analysts are concerned that as the current generation ages, their resale values will eventually plummet if incentives continue to increase as Toyota looks to keep the Camry's best-selling car crown going forward.