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Auto execs surveyed say VW, BMW most likely to grow

A new survey of top global automotive executives indicates both Volkswagen and BMW are the most likely to grow their market share over the next five years.
Tax advisory firm KPMG LLP has released its 14th annual Global Automotive Executive Survey, which includes responses from over 200 executives. A total of 81 percent of respondents said they expect to see Volkswagen make gains, compared to 70 percent last year. BMW, meanwhile, saw 70 percent of those surveyed say they believe the company will increase its market share. That's a jump of 7 percentage points over last year. This is the first time in the history of the survey that BMW has claimed the second-place spot.
Meanwhile, Hyundai has seen its perceived market share potential slacken for the third year in a row. Around 61 percent of those surveyed predicted gains for Hyundai, down from 63 in 2012. Toyota also has a surprising year, but for just the opposite reason. While the manufacturer had slipped in ranking since 2011, it enjoyed the largest increase of any company in the 2013 survey, jumping to 68 percent from 44 percent last year.

Volkswagen loses thousands of vehicles in Chinese explosion

Yesterday, a blazing, explosive fireball erupted from a port in the city of Tianjin, in China, lighting up the night sky and shattering windows with the force of 21 tons of TNT. Hundreds were injured and the death toll continues to rise, with the most recent reports claiming 50 were killed. While the human cost of this tragedy simply can't be overstated, it hasn't taken long for corporations to look into what the enormous explosion cost them. And for Volkswagen, the answer is quite a lot. According to our friends at Jalopnik, a Chinese source claims the German giant, which remains one of the PRC's most popular brands, lost thousands of vehicles. The automotive casualty sheet lists 1,065 Touaregs, 391 Beetles, 257 Tiguans, 114 Golfs, 84 Up! minicars, 39 SportVans, and 28 Magotans (a locally built version of the Passat). While those are the only vehicles listed, the Chinese source said over 2,700 vehicles were destroyed. For example, both Land Rover and Renault lost an unspecified number of Discovery SUVs and Koleos CUVs, respectively. The explosion also affected Toyota. Its research and design facility with joint-venture partner Sichuan FAW also suffered an unspecified amount of damage. You can check out the translated source article here. As Google Translate jobs go, though, this one is particularly bad, but it still offers some details of the automotive cost of this disaster.

Rising aluminum costs cut into Ford's profit

When Ford reports fourth-quarter results on Wednesday afternoon, it is expected to fret that rising metals costs have cut into profits, even as rivals say they have the problem under control. Aluminum prices have risen 20 percent in the last year and nearly 11 percent since Dec. 11. Steel prices have risen just over 9 percent in the last year. Ford uses more aluminum in its vehicles than its rivals. Aluminum is lighter but far more expensive than steel, closing at $2,229 per tonne on Tuesday. U.S. steel futures closed at $677 per ton (0.91 metric tonnes). Republican U.S. President Donald Trump's administration is weighing whether to impose tariffs on imported steel and aluminum, which could push prices even higher. Ford gave a disappointing earnings estimate for 2017 and 2018 last week, saying the higher costs for steel, aluminum and other metals, as well as currency volatility, could cost the company $1.6 billion in 2018. Ford shares took a dive after the announcement. Ford Chief Financial Officer Bob Shanks told analysts at a conference in Detroit last week that while the company benefited from low commodity prices in 2016, rising steel prices were now the main cause of higher costs, followed by aluminum. Shanks said the automaker at times relies on foreign currencies as a "natural hedge" for some commodities but those are now going in the opposite direction, so they are not working. A Ford spokesman added that the automaker also uses a mix of contracts, hedges and indexed buying. Industry analysts point to the spike in aluminum versus steel prices as a plausible reason for Ford's problems, especially since it uses far more of the expensive metal than other major automakers. "When you look at Ford in the context of the other automakers, aluminum drives a lot of their volume and I think that is the cause" of their rising costs, said Jeff Schuster, senior vice president of forecasting at auto consultancy LMC Automotive. Other major automakers say rising commodity costs are not much of a problem. At last week's Detroit auto show, Fiat Chrysler Automobiles NV's Chief Executive Officer Sergio Marchionne reiterated its earnings guidance for 2018 and held forth on a number of topics, but did not mention metals prices. General Motors Co gave a well-received profit outlook last week and did not mention the subject. "We view changes in raw material costs as something that is manageable," a GM spokesman said in an email.