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Major automakers urge Trump not to freeze fuel economy targets

WASHINGTON — Major automakers are telling the Trump administration they want to reach an agreement with California to avoid a legal battle over fuel efficiency standards, and they support continued increases in mileage standards through 2025. "We support standards that increase year over year that also are consistent with marketplace realities," Mitch Bainwol, chief executive of the Alliance of Automobile Manufacturers, a trade group representing major automakers, will tell a U.S. House of Representatives panel on Tuesday, according to written testimony released on Monday. The Trump administration is weighing how to revise fuel economy standards through at least the 2025 model year, and one option is to propose freezing the standards through 2026, effectively allowing automakers to delay investments in technology to cut greenhouse gas emissions from burning petroleum. The National Highway Traffic Safety Administration has not formally submitted its joint proposal with the Environmental Protection Agency to the White House Office of Management and Budget for review. Even so, last week, California and 16 other states sued to challenge the Trump administration's decision to revise U.S. vehicle rules. Auto industry executives have held meetings with the Trump administration for months and have urged the administration to try to reach a deal with California even as they support slowing the pace of reduction in carbon dioxide emissions that the Obama administration rules outlined. One automaker official said part of the message to President Donald Trump at a meeting on Friday will be to consider California like a foreign trade deal that needs to be renegotiated. Automakers want to urge him to get automakers a "better deal" — as opposed to potentially years of litigation between major states and federal regulators. On Friday, Trump is set to meet with the chief executives of General Motors, Ford, Fiat Chrysler and the top U.S. executives of at least five other major automakers, including Toyota, Volkswagen AG and Daimler AG, to talk about revisions to the vehicle rules. Senior EPA and Transportation Department officials will also attend. Environmental groups are eager to keep the rules in place, saying they will save consumers billions in fuel costs. A coalition of groups plans to stage a protest outside Ford's headquarters in Michigan.

FCA's European boss quits after losing out as Marchionne's replacement

MILAN — Fiat Chrysler's European boss has quit, adding to the problems facing new CEO Mike Manley, who must deliver on promises to boost production of SUVs and catch up with rivals in electric cars. Jeep division head Manley was named on Saturday to succeed Chief Executive Sergio Marchionne, one of the auto industry's most tenacious and respected leaders, who fell seriously ill after suffering complications following surgery. It emerged on Monday that Alfredo Altavilla, head of Fiat Chrysler's business in the Europe, Middle East Africa had resigned, according to a source with knowledge of the matter. He had been a rival for the top job along with Manley and Chief Financial Officer Richard Palmer. It's another complication to new CEO Manley's task of executing his predecessor's plan to keep the world's seventh-largest carmaker competitive in the absence of a merger. Marchionne had been due to step down next April, so the market reaction was limited on Monday. The shares initially fell more than 5 percent, but then pared some losses and were down 2.4 percent by 0930 GMT. "The downside may be modest, at least in the next 12 months. But long-term concerns will build — Marchionne ran FCA in a command and control style, with constant firefighting measures," said Bernstein analyst Max Warburton. Fiat Chrysler Automobiles (FCA) said British-born Manley would pursue the strategy that Marchionne outlined last month. FCA has pledged to increase production of sport utility vehicles and invest in electric and hybrid cars to double operating profit by 2022. It also unveiled bold targets for Jeep, which has become FCA's ticket to creating a high-margin brand with global appeal. Reviving struggling brands Analysts said that choosing Manley, 54, under whose watch Jeep's sales surged fourfold, sent a clear message that FCA was staying on course and would keep the Jeep brand at the heart of its growth plan. "Manley knows that his primary focus is on execution and that, already, he has a strategy into which his team has bought," said George Galliers, an analyst at Evercore ISI. "There is no reason the 2022 plan cannot be executed." Under Manley, the company is expected to sharpen its focus on revamping individual brands, including ailing Fiat in Europe, Chrysler in the United States and Alfa Romeo, which has yet to turn a profit despite multibillion-euro investments.

Toyota, Ford not interested in FCA merger

Sergio Marchionne will preach the benefits of mergers to anyone who'll listen, but his calls for industry consolidation may be falling on deaf ears. At least, that is, the ears of those who the Fiat Chrysler chief would most like to bend. Not only is General Motors uninterested, but according to The Detroit News, neither are Toyota or Ford. "It's something we would not be interested in," said Toyota's North American chief Jim Lentz, at the groundbreaking ceremony for the new Toyota Technical Center. "At 10 million (vehicles) we have enough scale right now to do what we need to do. There really would be no advantage for us." Toyota isn't the only one unenthused by the prospect of merging with Fiat Chrysler Automobiles. The Detroit News also reports that Ford, though it may yet to have been approached by Marchionne, wouldn't be interested either. "We're not a suitor for FCA," said Ford CFO Bob Shanks. "We don't see that type of opportunity as one that applies to us." With GM, Toyota, and Ford expressing disinterest in Marchionne's merger idea, the FCA chief will likely start looking elsewhere – or look for other ways to compel his primary candidate to reconsider. He may eventually find a partner – more likely in the Far East or within Europe – but it may not take the form of the major player Sergio has hoped for. News Source: The Detroit NewsImage Credit: Bill Pugliano/Getty Chrysler Fiat Ford Toyota Sergio Marchionne FCA merger fiat chrysler automobiles