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EU formally questions French government assistance of Peugeot's finance arm

Recently, the finance arm of PSA/Peugeot-Citroën was in such debt trouble that it was pricing itself out of the car loan market. The rates it was paying to service its debt, which was rated one step above junk, were so high that it was forced to charge car-buying customers higher rates than they could find elsewhere. This was adding to Peugeot's already impressive woes by sending revenue out the door to competitors.
Two months ago a deal was worked out with the French government whereby the state would provide 7 billion euro ($9 billion USD) in bonds to guarantee the finance arm's loans. The French government could nominate someone to join the Peugeot board, Peugeot would guarantee more French jobs, and on top of that deal, other banks would provide non-guaranteed loans. The government would take no equity stake in the car company.
Although not yet finalized, the arrangement is meant to create some breathing room for Peugeot Finance to lower its interest rates for customers, and a government-nominated board member, Louis Gallois, was recently named to Peugeot's supervisory board. The arrangement was also openly questioned by at least three competitors: Ford, Renault - which is 15-percent owned by the French government after it received state aid - and the German state of Lower Saxony, itself a 15-percent shareholder in Volkswagen.

VW confirms Golf GTD diesel coming to US for 2016

Part of the Volkswagen Golf recipe that has helped the car sell more than 30 million units in just under 40 years is the number of variants in which the hatchback is offered. Building on that range here in the US, Automotive News is reporting that we will finally be getting the sporty Golf GTD, likely as a 2016 model. It's the GTD, you'll recall, that crosses the performance abilities of the venerable GTI with a powerful and fuel-efficient diesel engine.
After speaking with Andreas Valbuena, Volkswagen product manager for the Golf, AN not only says that the GTD will for sale in the US in a couple years, it also estimates a baseline price of around $27,000, which would place it between the current pricing for the GTI and the Golf R. The GTD is launching in Europe this summer, but we won't be getting the seventh-generation Golf in the US for another year. The news about the performance diesel model isn't entirely unexpected - VW officials have been hinting at it for at least a year now, going so far as to import a sixth-generation model for media test drives on US soil, a task we happily took them up on last year.
The Mk VII GTD uses VW's 2.0-liter TDI engine with output increased to 184 horsepower and 280 pound-feet of torque, allowing the car to sprint to 60 miles per hour in about seven seconds while returning more than 40 mpg in highway driving. We can't wait.

Will a Phaeton EV rise from the VW Dieselgate ashes?

The Volkswagen diesel emissions scandal isn't even close to ending, but in a new announcement the automaker says it is working to rehabilitate its battered image a little bit. In a series of pledges, the German company is putting a serious emphasis on future electrification. Headlining this EV onslaught: the next-gen Phaeton will be fully battery powered. VW is still very light on details about its future flagship, and Tesla shouldn't be shaking in its boots yet. The automaker simply promises "a pure electric drive with long-distance capability, connectivity and next-generation assistance systems as well as an emotional design." According to insiders speaking to Autocar, the Phaeton potentially launches in 2020, and it might share a platform and powertrain with the production version of the Audi E-Tron Quattro concept. A new Phaeton was rumored to be nearly ready earlier this year, but the project was reportedly scrapped to cut costs. VW loses money making the current one, and sedan competes against other products, like the Audi A8. Perhaps the company sees this scandal as a perfect opportunity to revaluate the point of the vehicle. While the Phaeton EV will represent the top of VW's future lineup, electrification will appear further down the line, as well. The automaker will create a new platform called the MEB specifically for compact EVs. Promising ranges between 155 and 311 miles, the architecture will be offered across the VW Group brands and on "both passenger cars and light commercial vehicles." This electrification push will likely affect current models, too, thanks to further engineering of the MQB platform. VW wants the vehicles to support longer-range plug-in hybrids, mild hybrids, and EVs with 186 miles of distance. Since the architecture is already on sale, presumably these are the first vehicles to benefit from the new strategy. VOLKSWAGEN BRAND BOARD OF MANAGEMENT TAKES STRATEGIC DECISIONS Accelerated implementation of the efficiency program creates room for reorientation Streamlined processes leverage further cost-saving potential, including cuts in fixed costs Investments to be reduced by 1 billion euros per year compared with planning – combined with prioritization of projects for the future Product decisions formulated New Phaeton will be electric New Modular Electric Toolkit planned Wolfsburg,October 13, 2015 – The newly-formed Volkswagen Brand Board of Management took further strategic decisions at a special meeting. CEO Dr.