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Mixed sales results, but automaker stocks rise on need for cars in Houston

DETROIT — The Big Three Detroit automakers on Friday reported better-than-expected August sales and issued optimistic outlooks for demand as residents of the Houston area replace flood-damaged cars and trucks after Hurricane Harvey, sending their stocks higher. General Motors, Ford and Fiat Chrysler posted mixed August U.S. sales, with GM up 7.5 percent and Ford and Fiat Chrysler down. Japanese automaker Toyota improved sales by nearly 7 percent, while Honda fell 2.4 percent. Still, analysts focused on the potential for Detroit automakers to cut inventories and stabilize used vehicle prices as residents of Houston, the fourth largest city in the United States, are forced to replace tens of thousands, perhaps hundreds of thousands, of vehicles after the devastation from Hurricane Harvey. Mark LaNeve, Ford's U.S. sales chief, told analysts on Friday that following Hurricane Katrina in 2005 "we saw a very dramatic snapback" in demand. That said, Ford sales fell 2.1 percent in August. It sold 209,897 vehicles in the United States, compared with 214,482 a year earlier. Sales were down 1.9 percent in the Ford division and off 5.8 percent at Lincoln. Demand was down for cars, crossovers and SUVs. It was not clear how many vehicles in the Houston area will be scrapped, LaNeve said, saying he had seen estimates ranging from 200,000 to 400,000 to 1 million. Ford's Houston dealers may have lost fewer than 5,000 vehicles in inventory, he said. Ford is the No. 1 automaker in the Houston market, with 18 percent share, according to IHS Markit. The company plans to ship used vehicles to Houston dealers and has "every indication we would have to add some production" of new vehicles to meet demand, LaNeve said. Investor concerns about inventories of unsold vehicles and falling used car prices have weighed on Detroit automakers' shares most of this year. Now, automakers can anticipate a jolt of demand from a big market that is a stronghold for Detroit brand trucks and SUVs. "It's got to be a positive for the industry," LaNeve said. Investors appeared to agree. GM shares rose as much as 3.3 percent to their highest since early March. Ford increased 2.8 percent at $11.34, and Fiat Chrysler's U.S.-traded shares were up 5.2 percent $15.91, hitting their highest in more than five years. GM reported a 7.5 percent increase in U.S. auto sales in August, helped by robust sales of crossovers across its four brands.

Five automakers now being investigated by NHTSA for airbag woes

It appears that Toyota's renotification to owners of recalled vehicles from last year is just the tip of the iceberg for what could potentially be a much larger industry-wide recall. The National Highway Traffic Safety Administration is opening a preliminary evaluation investigation into roughly 1.1 million vehicles from Chrysler, Honda, Mazda, Nissan, Toyota and parts supplier Takata regarding faulty airbag inflators in several models.
NHTSA has received six reports - three directly, two from Takata and one from Toyota - of vehicles with ruptured airbag inflators from 2002-2006, which resulted in three injuries. So far, all six incidents have occurred in high humidity areas like Florida and Puerto Rico. According to Toyota's latest recall announcement, the inflators may have an improper propellant that could cause it to rupture in a crash and the bag to deploy abnormally.
This new investigation follows a previous recall from April 2013 of about 3.4 million vehicles worldwide for the airbag inflators from Takata. As Autoblog reported, Toyota jumpstarted the new situation when it found that the original list of serial numbers for the faulty part was incomplete and discovered more cars in need of replacement. Honda and Nissan told us that they were investigating whether further models would need called in again as well. Mazda told Autoblog: "Regarding the current Takata situation, we're working closely with NHTSA and investigating the situation, but nothing else to report at this time." Chrysler Group responded to us with the statement: "Chrysler Group engineers are conducting the appropriate analysis. The Company will cooperate fully with the National Highway Traffic Administration."

Mazda's Tokyo concept foretells of rotary revival

Mazda has long been rumored to be planning a revival of its rotary-powered sports car. Some of those rumors may have come down to wishful thinking as much as concrete information. But now, on the eve of the Tokyo Motor Show, new details have come to light. The Japanese automaker is slated to unveil a two-door sports car concept, previewed in the teaser image above. Little in the way of firm information has been made available prior to the show car's debut, but sources are now citing senior company officials as confirming it has a rotary engine. "It is a two-door, two-seater, Mazda CEO Masamichi Kogai told Autocar. "It is a pure sports car design. We have MX-5 and another icon is a rotary sports car. We haven't talked about market reach but this would be in that segment." R&D chief Kiyoshi Fujiwara added: "People think rotary can not meet modern eco demands. The SkyActiv engineers worked on rotary and gave it cutting-edge tech. It is an essential part of our DNA and it [will] just be passed onto future engineers. It is synonymous with the brand. Some time in the future it will return and be called SkyActiv-R." The last time Mazda produced a rotary-powered model, of course, was with the RX-8, which ended production in 2012. That was preceded by three generations of RX-7, the first of which will be celebrating its 40th anniversary in 2018. If it manages to get the Wankel technology up to modern standards, that could provide just the right opportunity for Mazda to launch a new model. Reached for comment, Mazda spokesman Jacob Brown told Autoblog: "While we can confirm that Mazda continues to develop rotary engines, we cannot confirm production of a rotary at this point. Rotaries are one of the signature engineering technologies that define Mazda, and we will continue exploring them to see where they may fit for production applications." Related Video: