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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.

Automotive Grade Linux will be the backbone of your connected car

Creating a backend for a secure, reliable, and expandable infotainment system is costly and time consuming. The Linux Foundation, a non-profit organization, has set out to promote and advance the Linux operating system in commercial products. Automotive Grade Linux, or AGL, is a group within the Foundation that seeks to apply a Linux backend to a number of automotive applications in a variety of vehicles from various suppliers and manufacturers. AGL's goal is to create a common, unifying framework that allows developers and manufacturers to easily implement applications across platforms. Currently, the focus is on infotainment systems, but AGL has plans for instrument clusters, heads-up displays, and eventually active safety software. At CES, a display from Panasonic showed a completely digital and customizable dashboard that allows information and apps to be moved from the gauge cluster to the infotainment screen and back, all through the use of gesture and touch controls. Although the organization has been around for five years, it's really only been in the past three that the group has been working hand in hand with automakers and suppliers. The first two OEMs to participate, Toyota and Jaguar Land Rover, have since been joined by Mazda, Suzuki, Ford, and, as of this week, Daimler. The latter is important as until now most of AGL's partner's have been based in Japan or the US. Other partners include suppliers Denso, Renesas, Continental, Qualcomm, and Intel. AGL want's to supply roughly 80 percent of the backend, allowing partners to then finish and refine the Linux system for each individual application. Think of how the Android operating system is refined and customized for individual smartphones from Samsung, LG, and Motorola. While the final product looks different, developers can have an application that will work across all AGL systems. Because it is open source, anyone can use and develop for AGL. You can even go onto the group's website and download a copy right now. There is also a software development kit available that helps facilitate app creation on the platform. Vehicle development cycles take roughly five years, so there currently are no cars that run an AGL backbone available for consumers. AGL Executive Director Dan Cauchy says products should be hitting the market later this year, with even more coming in 2018. Right now, the industry is relatively fragmented when it comes to infotainment and related systems.

April Fools' Day brings Jeep Sedan, Hyundai N Roadster, Toyota Yaris pickup and more

There is one day out of the year when public relations professionals have permission to lie to journalists and to the public: April Fools' Day. Manufacturers release details about wild, weird and wacky new technology, concept vehicles and services. Some take it to obvious outlandish extremes (Jeep Sedan anybody?), while others plot to mislead with products that are just outside the realm of possibility. Check out all the "jokes" below. BMW Motorrad BMW doesn't want to exclude anybody from experiencing the thrill of high-level racing, so it is introducing 'iRace" autonomous programming on its S 1000 RR sport bike. It includes beginner, sportsman, advanced and unlimited driving modes, and stores GPS information for all Superbike world championship tracks. Hyundai Hyundai is wrong for this. The Hyundai N Roadster is the work of South Korean designer Yeonjoon Park and features a 2.0-liter turbocharged engine, rear-wheel drive and a hard convertible top. Hyundai says this is a "concept (for now)," but we think it'd make a seriously great Mazda Miata competitor. Honda Honda wins the award for the best interactive gimmick, as its press release for the '90s-inspired special-edition Pastport includes a live hotline number with a message from Fred Savage. Call 1-833-PASTPORT for more information. Jeep Put the Jeep Cherokee face on the Chrysler 300's body, and voila! The 2019 Jeep Sedan is born. We can't decide if the name or the rendering is better. Land Rover Accessibility to charging ports is of major concern to anybody with a plug-in vehicle. So, with the recent launch of the Range Rover P400e and Range Rover Sport P400e, Land Rover is putting forth an effort to install more stations around the globe. First up is Scotland's Isle of Skye. Adventurers need juice too! Lexus Australia Lexus expands its Encore service to include doggos. The new service, called Enpaw, will take pups to luxury boarding kennels in style. Toyota U.S. Toyota created the Yaris Adventure pickup for "those who want to tell their friends they own a truck but never veer off pavement." It's part Mazda 2, part RAV4, 100 percent ute and it looks ... great? Creating a new segment might be all fun and games to Toyota, but Ford is reportedly considering a Focus-based ute in a similar, albeit larger, style. Toyota Australia Toyota is launching a new HiAce van, and it's already getting a limited-edition variant called the PieAce.