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United States drivers buying fewer Mexican-made cars

Crossovers and pickup trucks are not only growing in market share, they're also more profitable than cars. A crossover on the same platform as a sedan retails for thousands more, despite similar components. It's one of the reasons we've seen automakers rapidly shifting production of their sedans and hatchbacks to Mexico, where cheap labor preserves the thin profit margins on these inexpensive vehicles. But as the market continues to shift in the United States, Mexico is getting burned by its lack of product diversity. The country's auto exports, which are heavy on cars, suffered a 16-percent drop last month, Automotive News reports. In total, year-over-year exports fell from 233,515 to 197,020 last month, while year-to-date exports are down by 7.4 percent, from 922,029 to 854,118. The number one culprit? America – which usually accounts for 75 percent of Mexico's exports – and its appetite for crossovers and pickup trucks bolstered by cheap gas prices. While Mexico does build some light truck models – AN specifically calls out the Ram 2500, Honda HR-V, GMC Sierra, and Toyota Tacoma as export leaders – the vast majority of vehicles rolling out of its factories are sedans and hatchbacks. In fact, the three biggest drops in Mexican exports came from companies whose south of the border factories only build cars – Ford (Fusion/Lincoln MKZ and Fiesta), Mazda (Mazda3), and Volkswagen (Golf and Jetta). Mexican Automotive Industry Association President Eduardo Solis told AN the export shortfall will likely be sorted out sooner rather than later, thanks to a pair of new factories – a Kia car factory and an Audi SUV plant – that are coming online by year's end. The two facilities will add around 100,000 vehicles to the country's export totals, which Solis said should leave the industry on the verge of breaking another export record in 2016. But how sustainable will these record-breaking years be? Slapping an "Hecho en Mexico" sticker on a new German SUV won't be enough to change the fact that Mexico's product mix is tilted too heavily towards body styles that are not growing in volume. Mexico's record-breaking export years probably aren't at an end, but we'd argue they're certainly under threat. News Source: Automotive News - sub. req.Image Credit: Omar Torres / AFP / Getty Images Plants/Manufacturing Ford GMC Honda Mazda RAM Volkswagen Truck Crossover SUV Mexico

Interested, then not: Marchionne not 'chasing' a VW merger

Update (March 15, 2017) : Automotive News reports that FCA CEO Sergio Marchionne, regarding the suggested VW and FCA merger, said in a press conference "I have no interest." He also said that he "will not call Matthias," the CEO of VW. He did add that he would be willing to entertain anything VW brings up, but he has "no intention of chasing him." Despite this, Marchionne still took a moment to reinforce his favorable stance concerning mergers and consolidation. Last week, Volkswagen's CEO Matthias Mueller effectively shut down Fiat Chrysler CEO Sergio Marchionne's idea of the two automakers merging. However, it seems Mueller has softened, if only just, to the idea. According to Reuters, the CEO said in a press conference he is "not ruling out a conversation." However, he did say that he would like Marchionne to discuss with him directly the possibility rather than to the media. Though this statement certainly doesn't mean such a merger is happening, it's far more open than when he said outright the company isn't in any talks with anyone at the moment. His new stance also indicates that there may be people (lawyers, accountants, etc.) behind the scenes working out possible ways a merger could work. And even though this new development makes the prospect of a merger between the two companies a bit less bleak, it's still a long way from the "will they, won't they" relationship between GM and FCA. FCA's pursuit of GM involved emailing CEO Mary Barra and the threats of a hostile takeover, the latter of which resulted in some awkward statements about hugs. Only time will tell if VW becomes open enough for Marchionne to talk about hugs again. Related Video:

VW CEO lost his job over buggy software that delayed new models

It says a lot about the state of the auto industry and where it's going that software problems have cost the CEO of a carmaker his job. Volkswagen ousted Herbert Diess as chief executive officer after severe software-development delays set back the scheduled launch of new Porsches, Audis and Bentleys. This was untenable considering buggy software postponed the debut of VW’s initial rollout of ID models, and customers are still having to drop off their cars at the dealer for updates the company has struggled to make over the air. Sure, Diess also didnÂ’t do enough to make allies and became increasingly isolated due to his hard-nosed leadership style. In his push to transform the company into an electric-vehicle leader, he repeatedly clashed with labor leaders by warning VW was losing out to Tesla and needed to cut thousands of jobs. But failures at the carmakerÂ’s software unit Cariad ultimately eroded DiessÂ’s support from the powerful Porsche and Piech family that calls the shots. Back in December, VW overhauled its management board, stripping Diess of some responsibilities while tasking him to turn around Cariad. While thereÂ’s been a lot of re-arranging since then, Diess didnÂ’t manage to make the issues go away. Discord at Cariad has pushed back the rollout of important new models including the electric Porsche Macan, a high-volume sport utility vehicle for the division thatÂ’s planning an initial public offering in the fourth quarter. AudiÂ’s new line of Artemis EVs has been delayed by around two years to 2027. And VWÂ’s ultra-luxury brand Bentley may not be able to go all-electric by the end of this decade as planned because of the software issues, Automobilwoche reported earlier this month. “Taking over the ship at Cariad seems to have been DiessÂ’s downfall,” said Matthias Schmidt, an independent auto analyst based in Berlin. VWÂ’s solutions to challenges tend to reflect its status as an industrial behemoth: itÂ’s able to throw lots of money and people at its problems. But modernizing the company for the digital age is going to take bringing in talent and building skillsets outside its traditional zones of expertise. Drivers increasingly demand intuitive user interfaces and services that could create new revenue streams, if done correctly. “Software is the key to the future,” TeslaÂ’s Elon Musk tweeted when one of his followers asked about VW switching CEOs. Diess certainly didnÂ’t lack ambition.