2012 Ford Escape Xlt on 2040-cars

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Ford, GM still doing new business with Takata amidst airbag crisis

Lengthy vehicle development times make it difficult for automakers to cut and run from the supplier. You might expect automakers to be fleeing any connection with beleaguered supplier Takata in the wake of the company's exploding airbag inflator crisis. After all, with a Senate hearing, pending lawsuit, plummeting stock value and demand for a national recall, the tier-one supplier isn't at its strongest right now. However, years of cooperation mean that automakers are standing by Takata, and necessity may be playing a role, as well. About 39 percent of Takata's business comes from airbags, and seatbelts make up another significant chunk of the operation too, says Bloomberg. The long-term relationships and lengthy vehicle development times make it difficult for automakers to cut and run from the supplier. "Takata has so much product breadth that I don't really see that they could just disappear," said AutoPacific analyst Dave Sullivan to Bloomberg. For example, Takata helped develop the unique front center airbag with General Motors in models like the Chevrolet Traverse and Buick Enclave. Outside of safety tech, it is also a partner with Ford on the adaptive steering system available on the upcoming 2015 Edge. These long-lasting partnerships make change difficult now that there's a problem. According to Reuters, automakers claim it would take a year or longer to set up with a different supplier for replacement airbag inflators. Switching to a completely different part for the repairs might not be a viable option either, because of the engineering time needed. BMW is taking action, though. According to Reuters, the Bavarian brand is working with the supplier to move inflator production from Monclova, Mexico, to a Takata factory in Freiburg, Germany. The Mexican plant may be the source of some of the faulty parts. News Source: Bloomberg, ReutersImage Credit: Jens Meyer / AP Photo BMW Ford GM Safety Takata airbag recall

IIHS updates overlap test: 2 SUVs get good marks, 9 fare poorly

Vehicles in crashes keep occupants safe by deforming around the cabin in a way that maintains cabin integrity. The Insurance Institute for Highway Safety's moderate overlap test, introduced in 1995, has been a huge contributor to improved safety for front-row passengers in a crash. IIHS President David Harkey said, "Thanks to automakers’ improvements, drivers in most vehicles are nearly 50% less likely to be killed in a frontal crash today than they were 25 years ago." In the 'unintentional side effects' column, crash safety has gotten worse for passengers in the back seats. When carmakers reengineered the front crash structure to protect the driver, more crash forces got distributed throughout the rear. IIHS research claims rear passengers have a 46% greater risk of fatal injury than front-row passengers, but back-seaters haven't benefited from the same upgrades in safety as the front row. The IIHS updated its moderate overlap test to address the issue, putting 15 vehicles through the new regime. Two earned good ratings — the 2023 Ford Escape and the 2021-2023 Volvo XC40 — one was acceptable, three were marginal and nine were rated poor. Every one of the crossovers sampled got good marks for all passengers in the original test. That test sees 40% of vehicle's width on the driver's side impacting an aluminum honeycomb barrier at 40 miles per hour. The updated test puts a crash dummy representing small woman or 12-year-old child in the seat behind the driver, the dummy's sensors and grease paint measuring the effectiveness of the restraints and the forces a human body would need to endure. To achieve a good rating, the "measurements must not exceed limits indicating excessive risk of injury to the head, neck, chest, abdomen or thigh." An institute engineer said, "In real-world crashes, chest injuries are the most common serious rear-seat injuries for adults." The sensors and video evidence showed back seat dummies in the Escape and XC40 endured minimal risk of injuries from excessive crash forces, from submarining under the seat belt, or from unwanted interaction with the side curtain airbag.   The Toyota RAV4 scored acceptable. The second-row dummy also endured minimal risk of injury to the chest and lower extremities. However, the lap belt slipped upward in a way that could increase abdominal injuries, and after the dummy's head dipped during crash impact, the head came back up between the rear curtain airbag and rear window.

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.