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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 service tech joyrides customer car, allegedly takes drugs on the way [UPDATE]

UPDATE: We've received and added an official statement from Audi Palo Alto. Dealerships get a bad rap. Stories about sleazy salespeople and overpriced service procedures abound, even though the reality is that most dealers are run by and employ honest, fair folks. But just because the bulk of dealers and their employees are good people, it doesn't mean some bad eggs won't slip through the cracks. Audi Palo Alto, in the heart of Silicon Valley, is finding this out the hard way after dash cam video of a service tech abusing a customer's car started blowing up on YouTube. In the video, which you can watch above, the unnamed service tech took YouTube user Carrera Chris's Audi – it's not clear what model, but it sounds like one of the company's higher-performance 3.0-liter, supercharged V6 models – for a rather spirited test drive. There are plenty of wide-open-throttle runs mixed in with some speeding – the dash cam's lower display shows 90 miles per hour at one point on the freeway – and you can hear the driver laughing throughout. None of this is too remarkable on its own, and maybe not enough to get the tech fired. Until, that is, he pulls into a parking lot and begins snorting something. The dash cam doesn't show the technician, so it's impossible to determine what substance – if any – the driver is allegedly taking. It could be coke, could be crushed up pills, or, hey, it could be a prescription nasal spray (it is allergy season, even in perpetually lovely northern California). Carrera Chris does say he found white powder in the seams of the driver's seat, so take that for what it's worth. There are five videos that include 12 minutes of footage – the one up top is a summary, while the four below show the alleged drug use and some more mundane footage. We've reached out to Audi Palo Alto's general manager, Jason Mattia. He wouldn't answer our questions over the phone, but did forward an official statement from the dealer. An unfortunate incident was brought to our attention earlier this week. We immediately began our investigation and have already taken action. We are working with the customer involved and have thanked them for bringing this matter to our attention. At Audi Palo Alto, we are proud to be a part of the San Jose community. We value and respect our customers, and our team of 75 employees strives to deliver the highest level of customer service.

Audi unveils A3 Sportback G-Tron with bi-fuel power, 808-mile range

By this time next year, the Audi A3 Sportback will be offered with a variety fuel-efficient powertrains ranging from diesel to the all-electric E-Tron, but perhaps the most interesting is the all-new G-Tron model, which uses Audi's innovative carbon-natural compressed natural gas called e-gas. Previously called A3 TCNG, we first heard about this technology last year, but now Audi has confirmed that this low-emission, sustainable-fuel will debut by the end of this year on the A3 Sportback G-Tron.
To create this e-gas, a plant in Werlte, Germany uses electricity to split water into hydrogen and oxygen. As hydrogen fuel cell vehicles become more popular, Audi says that this process could also be used to produce hydrogen fuel, but to create CNG, it mixes the hydrogen with carbon dioxide to create "synthetic methane." Since it is identical to the CNG available today, Audi's e-gas can be shipped and stored using the existing CNG infrastructure. Making the whole process even greener, Audi obtains the CO2 for this process from a nearby biogas plant, which would otherwise be released into the atmosphere.
Differentiated from the regular versions of the A3, the G-Tron features a pair of tanks under the rear cargo floor holding 15.43 pounds of CNG, which can power the car for almost 250 miles. What's more, the A3's conventional gasoline tank is still in place, giving the car an addition 560 miles of range. In total, that means the A3 G-Tron has a driving range of more than 800 miles. To run on both CNG and gas, Audi made changes to the car's 1.4-liter four-cylinder engine (including the turbo, cylinder head and fuel injection system) and catalytic converter.