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India will not buy Hummer Brand!!

MUMBAI (Reuters) -- Mahindra & Mahindra Ltd., India's top utility vehicle maker, is not interested in buying General Motors' Hummer brand, but will instead focus on its own models for the key U.S. market, a senior official said.

"There has been a lot of speculation. I want to say categorically we are not pursuing Hummer," Vice Chairman Anand Mahindra said at a news conference.

"We are pursuing our own models strategy and we do not want to tarnish our lean warrior strategy," he said, referring to Mahindra's plans for a line-up of eco-friendly vehicles.

Earlier on Monday, a source told Reuters China's Hunan Changfeng Motor Co. had held preliminary talks with General Motors, and that the Chinese sport utility vehicle maker had backed off, underlining the difficulty the U.S. firm faces in offloading the troubled brand at a time of high fuel prices.

GM, also struggling against a downturn in the North American auto market, has explored a sale of Hummer with potential buyers in Russia, as well, sources have said. Russian billionaire Oleg Deripaska's car unit, Russian Machines, last week also denied it was seeking to buy Hummer.

Mahindra, which earlier this year lost the race to buy the Jaguar and Land Rover luxury brands to larger rival Tata Motors Ltd., plans to launch a small pickup truck and an SUV in the U.S. market, starting in the second half of 2009.

Mahindra declined to comment on whether the company would stick to its timeline for these launches, given falling sales of pickup trucks and SUVs in the U.S. market.

CHINA TRACTOR JV

Mahindra, also India's top tractor maker, said on Monday it would take a 51 percent stake in a joint venture with Chinese tractor maker Jiangsu Yueda Yancheng Tractor Manufacturing Co, taking it a step closer to claiming top spot in the world.

Mahindra, which already makes tractors in China through Mahindra China Tractor Co. Ltd, a venture with Jiangling Motors Co Group, will invest about $26 million in the venture, which will acquire Yueda's tractor operations for $50 million.

"The formation of this joint venture is a significant step in our plans for the China market," Anjanikumar Choudhari, president of Mahindra's farm equipment sector, said in a video conference.

"Along with our current operations, we will have a much larger scale and a cost-effective manufacturing base on which to build up our business in China and for overseas markets."

Yueda is No. 3 in the Chinese market, the fastest growing market for tractors, and one where consumers are shifting to more powerful tractors, Choudhari said. Yueda's portfolio of tractors from the 16-125 hp range will help address the demand.

Mahindra will consider merging its China operations at a later date, he said, without giving more details.

Mahindra, which last month bought the assets of motorbike and scooter maker Kinetic Motor, will have a capacity of about 170,000 tractors with the new venture, which will bring it very close to leader Deere & Co., if not overtake it.

"For a long time the Mahindra Group has aspired to become the No. 1 tractor manufacturer in the world," Mahindra said.

"I believe, with our new alliance, we would be able to achieve that goal more rapidly."

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74 MPG Mini Cooper Diesel

DETROIT — I'm cruising south on Interstate 75 at a steady 64 mph. If the fuel economy gauge in the car can be believed — and there's no reason that it shouldn't — I'm burning one gallon of fuel every 74 miles.

I'm not limping along in some wimpy gasoline-electric hybrid. I'm not drafting behind a semitruck. And I'm not relying on any of the dangerous maneuvers that hypermiling eco-geeks use as they try to extract every inch of distance out of a gallon of gasoline.

Nope. I'm in a 2007 Mini Cooper D, and I am driving it normally. The D stands for diesel. It's a version of the popular hatchback that isn't available in the United States — yet.

Here's a car that lets you have your high fuel economy cake and eat big slices of it, too. Just as important as the Mini Cooper D's ultralow fuel consumption is its fun-to-drive factor. It's off the charts in this car.

The Mini Cooper D is quick. Its 1.6-liter turbocharged diesel engine propels the 2,600-pound hatchback to 60 mph in 9.7 seconds. Plus, the car is good-looking, the chassis is rock-solid, and the handling is as tight as a go-cart.

The engine runs smoothly and, if you keep the windows up, quietly. BMW did a nice job of keeping the diesel chatter out of the interior.

The Bosch high-pressure fuel injection system helps the engine run cleanly. I put my finger into the exhaust pipe expecting it to turn black from soot. It was clean. There was no exhaust residue in the pipe.

The 2001-06 first generation of the new Mini Cooper also had a diesel engine. But that car, with just 75 hp, did not have the chops for the U.S. market — too slow.

The second generation, launched in 2007, has 108 hp and easily can run with other economy cars in its class.

BMW plans to offer the Cooper diesel in the United States when the emissions system is robust enough to allow the car to be sold in all 50 states. The company declines to say when that might happen.

Diesel engine technology is expensive. But if BMW could figure out a way to sell the Mini Cooper D for about the same price as a loaded Mini Cooper S, the car could be a big success here.

But they are a long, long way from that. For now, the Cooper D would cost at least $25,000, roughly $7,000 more than the base model.

SOURCE:Automotive News

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Hummer plans aggressive pitch for new H3T

FRESNO, Calif. -- The future of Hummer remains uncertain, but that's not stopping Hummer from launching a pickup truck.

Hummer will spend a significant amount to advertise the H3T, believing that no matter what happens with the brand, the mid-sized pickup will be a benefit.

"Launching the H3T is valuable for us, whether we opt to keep the brand or not, and to a potential buyer, whether they buy the brand or not," Martin Walsh, Hummer's general manager, said at an event here late last month. "But constant throughout all of that is it's very valuable to dealers no matter what happens because of the revenue opportunities for them and the opportunity that they can bring in new customers."

General Motors insiders admit high gasoline prices and a decline in U.S. pickup sales make the H3T a tough sell. They hope the H3T will sell well overseas until the market here recovers.

Through July, U.S. pickup sales are off 23 percent to 1.2 million. Hummer has 168 dealers in the United States and 224 outside this country.

Marketing Hummer's pickup
How will Hummer market the H3T pickup amid dismal big-truck sales?
-- Seek sales through 224 dealers outside the U.S. until domestic market recovers
-- Launch H3T marketing campaign on TV in October, centered on traditional media
-- Pitch H3T as outdoor recreation vehicle with added pickup utility
-- Target males in their 30s who earn $90,000-plus and are into outdoor activities

Significant launch

Hummer will launch the H3T marketing campaign on TV starting in October. The campaign will run through 2009 and be centered on traditional media, Walsh said.

"The launch will be significant because we want to make an impact," he said. "A lot of the focus initially will be TV and print to communicate to the prospective purchaser that we've got a pickup truck."

Walsh characterized the spending as significant but "proportionate to the volume and the impact it'll have on the market. It's a niche player. It's not something we'd overspend on."

Hummer is developing the creative content. When it's done, Walsh said, that content will convey the message that the H3T not only enables people to pursue extreme sports in places where other vehicles could not take them, but it also will give them the utility of a full-sized, four-wheel-drive pickup truck -- in a "fuel-efficient package," Walsh said.

The H3T sticker price starts at $31,495, including shipping.

"It provides that extra utility other than the off-roading, and that's different from what we've done before," Walsh said.

The five-cylinder base engine H3T gets 14 mpg city and 18 highway. The Dodge Dakota, one of the H3T competitors, gets an estimated 16 mpg city and 20 highway.

30-something males

Despite the tough economy and decline in truck demand, Walsh said a market exists for the pickup. Hummer is targeting males in their 30s who earn $90,000 or more and are into outdoor activities.

As for the fate of Hummer, Walsh said GM is studying the cost to revamp the brand vs. Hummer revenue. The company is considering all options, including a possible sale.

Many Hummer dealers say the brand's uncertainty has left them struggling to keep their best salespeople on board and generate showroom traffic because of consumer concerns.

Walsh said the H3T pickup will bring customers into Hummer showrooms: "In the end, we're still running our business, and the best signal we can send to a customer who maybe has some doubts about it is to launch a new product and show how confident we are in the brand."

SOURCE:Automotive News

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Hyundai's Luxury Gambit

Korean Maker's Genesis Takes On
Lexus for $15,000 Less; Smooth Ride,
Superb Stereo, but Will It Sell?

Remember that old advertising tag line, "Rich enough to be served in America's finest restaurants"? In the commercials, upscale diners were filmed by hidden cameras as they heaped praise on an establishment's coffee. Then they were told it was instant Folgers and shock ensued. I'm having a similar reaction to the 2009 Hyundai Genesis.

This new luxury sedan is so good at emulating its competition that if the badges were removed it could be mistaken for a Lexus GS460. I'm not saying this just because Hyundai has taken Lexus's generic and inoffensive styling to a new level. This car has every $50,000 luxury car meme, from a V8 engine that powers the rear wheels, to soft leather on the dashboard and door panels, to an excellent navigation and multimedia system. Throw in a pushbutton starter and the package is complete.

About the only thing that might tip off a Lexus owner that the Hyundai wasn't his car would be the giant wad of money bulging in his pocket, since the $38,000 Genesis costs about $15,000 less. But even if money were no object you still could make a case for buying a loaded Genesis, and not because its five-year or 60,000-mile warranty trumps Lexus's and BMW's four years or 50,000 miles.

The interior of the Hyundai is every bit as nice as anything Lexus has ever dreamed up. The Genesis cabin has a subdued design and it's quiet, too, which is a good thing, as Hyundai offers a superb audio system. The front seats could be more comfortable, but that's my only real complaint. True, the Genesis follows BMW's dumb precedent of deploying what looks like a Pong videogame controller to operate a complicated computer interface, for the stereo and navigation system. But Hyundai's knob is better simply because it does less.

Then there's the issue of horsepower. Hyundai bests both Lexus and BMW while returning similar fuel economy, 19 miles per gallon in combined city/highway driving. The 4.6-liter V8 in the Genesis puts out 368 horsepower on regular unleaded, which is more than the 342 horses of the Lexus, or even the BMW 550i's 4.8-liter V8, which is rated at 360 horsepower. (And yes, both competitors would have you pumping premium.) On the other hand, the Hyundai is actually a bit heavier and its 324 pound-feet of torque is less than that of either the Lexus or BMW. The reality is that these differences in power ratings will mean little on the street, as all three cars have potent motors. The more noticeable difference is in handling, as the Hyundai's ride is softer and more luxurious than sporting, befitting its larger size and roomier cabin. You could chalk this up as another win, since the Genesis beats the Lexus and BMW in legroom, both front and back.

I could go on pointing out more ways the Genesis matches its luxury competitors, like the fact that both Hyundai and BMW source six-speed automatic transmissions from the same German supplier, ZF Friedrichshafen, but I think you get the point. Hyundai has finally accomplished what it's been threatening to do for a while, which is to boost its value-proposition game to another level.

Yet while on the surface this seems to be a brilliant strategy, Hyundai might stumble with the Genesis. The swath of the middle class targeted by this more-for-less sales pitch has been taking it on the chin recently, what with high gas prices, tight credit and tumbling real-estate values. I'm not an economist, but I figure if these people can no longer afford to pay seven bucks for cheese-and-bacon potato skins at Bennigan's, which recently closed the doors of its company-owned stores, they may not flock to a cut-rate luxury car, no matter how good it is. Perhaps the less expensive version of the Genesis, a V6-powered model that starts at $33,000, will look more appetizing.

Regardless, Hyundai has certainly cracked the code of the $50,000 luxury sedan, showing that by its accounting Lexus owners are paying fifteen grand or more just for that badge on the hood. As much as I enjoy the way this sends up the entire class of hubristic luxury sedans, the fact remains that these cars are immensely popular precisely because they are symbols of money, power and success. The people who buy them aren't likely to spend their year-end bonuses on a Hyundai any more than they might order Folgers Crystals after an important business lunch, no matter how good the car or cup might be.

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Ford to Sell $500 Million in New Shares

By JEFF BENNETT

DETROIT -- Ford Motor Co. plans to sell up to $500 million in new shares to cover the debt securities of its financial arm.

The proceeds from the common stock sale will be used to purchase, from time to time, outstanding debt securities of Ford Motor Credit Company LLC, the auto maker said in a federal filing Thursday. Sale of the shares will be handled by Goldman Sachs Group Inc.

"This is a debt for equity exchange," said Ford spokesman Bill Collins. The company is essentially selling the stock to buy down the credit arm's debt.

Ford, the second-largest U.S.-based auto maker, is making the move to bolster its balance sheet and rebuild faith in its credit arm, which has been struggling amid falling vehicle residuals. The auto maker posted an $8.7 billion loss for the second quarter.

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Tire Inflation Where to Get the Right numbers

Q: I have a 2007 Nissan Altima 3.5 SE with Bridgestone P215/55R17 93 V tires. The recommended tire inflation according to the car's door sticker is 33 pounds per square inch. The maximum pressure listed on the side walls of the tires is 51 psi. The guy at the oil-change shop said the information on the tire trumps that on the post and filled them to 51. It's easy to find statements about adverse consequences of underinflation, but I've seen none about over inflation. Are there any?
-- R. J. Ballman,
Moline Ill.

Associated Press

Use the manufacturer's tire-inflation recommendation

A: Eek! Your tires are definitely overinflated. It's best to stick with the inflation pressure listed on the car's door frame or in the owner's manual. The maximum pressure figure on the tire sidewall is more an indication of the tire's load limits that of the correct inflation level for everyday driving.

Q: I have heard that the Volkswagen Touareg diesel is supposedly getting 30-35 miles per gallon on the highway. If true, why don't they sell it in the U.S.?
-- Ted Bourne,
Portland, Ore.

A: You must have heard about the six-cylinder diesel model slated to arrive in 2009, not the current 10-cylinder diesel Touareg model. I just drove the latter and found its fuel economy about even with gasoline-powered SUVs. So there's no big advantage there.

The new version, however, is supposed to be capable of surprisingly high fuel economy. Having driven diesels with similar engines from BMW and Mercedes-Benz, I would expect the VW to flirt with 30 mpg. I'll believe 35 miles per gallon when I see it. Sounds like it could happen on a long, gentle downhill journey.

Q: Our busy family has put 80,000 miles on the 2005 Honda Odyssey. Given that we are going to continue to need a larger vehicle for the next four to five years, should we drive it till it dies, or is it a good time to trade it in on a 2008 Odyssey?
-- Tom and Kathy Beckley,
Pittsburgh, Pa.

A: I believe in getting your money's worth out of a vehicle, especially a family hauler. You should keep the Odyssey. It should take you through the next four or five years without much trouble and I think 200,000 miles isn't too much to expect.

Q: In light of today's fuel prices, why aren't more people trading in their lumbering SUVs for good old-fashioned station wagons if they need the cargo room but want better gas mileage and handling? I read recently that J.D. Powers & Associates predicts a continued decline in wagon sales, and that crossovers are fading fast now too. Not everyone can fit kids, pets, and sports gear into a sedan. Am I just a geek for liking my Subaru Outback, and lusting after the wagons from BMW, Audi, and Volvo?
-- Andrew Rittgers,
Denver

A: I think people are buying more station wagons, especially if you include so-called crossovers in that category. What are Mazda CX-9, GMC Acadia and Kia Rondo if not large station wagons. And how about the Ford Flex? I wish the company would just put faux-wood paneling on the flanks and call it a Country Squire.

Seriously, though, more traditional wagons ranging from the Subaru Outback and Volkswagen Jetta SportWagen to the Suzuki Forenza are looking more attractive to drivers who need extra space but want to continue drive a car instead of a "truck."

SOURCE: THE WALL STREET JOURNAL

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Auto Makers Must Work Harder To Sell to Affluent U.S. Buyers

By SHARON TERLEP
WALL STREET JOURNAL

DETROIT -- Luxury cars and trucks are beginning to fall victim to the same woes dragging down the rest of the U.S. auto industry, forcing auto makers to fight hard for sales and to employ new tactics to peddle their highest-priced vehicles.

The luxury market is down 11% year-to-date, with overall U.S. auto sales down 18%. The segment accounts for less than 10% of industry sales, but the wide profit margins and image-boosting potential of luxury nameplates make them valuable nonetheless.

General Motors Corp. on Friday rolled out new versions of one of its highest-priced vehicles, the massive Cadillac Escalade SUV. GM, looking to give affluent customers a reason to buy SUVs even as they fall out of favor with much of the American public, will soon begin selling a hybrid version and an even more posh "platinum" model.

GM is taking a bet that there is still demand for big, status-symbol trucks among buyers unscathed by the slumping economy.

Cadillac Escalade Hybrid was priced at

"Many people, despite the economic times, are still doing well," said John Howell, Cadillac global products director, noting that sales of luxury yachts and private jets are on the rise. "These peoples' needs haven't changed. They still want the top-of-the line products."

Other auto makers aren't so sure.

Ford Motor Co. has stopped production of its Lincoln Mark LT truck and is shifting its focus to smaller, more fuel-efficient cars and crossovers for the premium brand.

Toyota Motor Corp.'s luxury Lexus line has introduced a number of hybrids to its lineup in recent years.

Daimler AG's Mercedes, meanwhile, is offering deep discounts to move cars and trucks, a rarity in a segment far more likely to boast exclusive waiting lists for its products than cost-cutting deals.

"People who are in the market are waiting to see where the market's going," said Jessica Caldwell, industry analyst at Edmunds.com. "They're thinking, Can I really afford this type of vehicle?"

A number of luxury brands have taken a hit this year. Lexus sales are down 15% year to date, Honda Motor Co.'s Acura sales fell 14%, while Cadillac fell 12% and Lincoln 20%. The top European brands have fared better. BMW AG is down only 3% and Mercedes is up 2%.

Smaller cars are faring much better than trucks, Ms. Caldwell said, such as BMW's compact Mini brand. On the domestic side, two sedans, GM's Cadillac CTS -- the brand's second-smallest offering -- and Ford's new Lincoln MKS are doing well.

Ford sales analyst George Pipas said the downturn in truck demand has hit domestic auto makers especially hard, but high-end cars remain promising.

Luxury trucks won't go away altogether, Mr. Pipas said, but they will likely come to comprise only a tiny niche in the market.

The luxury market is in a downturn with the rest of the industry, but not necessarily for the same reasons, GM believes.

Typical car buyers are shifting toward much smaller vehicles as their budgets get pinched by record-high gasoline prices. Sinking home values and a credit crunch also have limited consumers' ability to buy new vehicles, driving down sales.

The story is a bit different with wealthier buyers, Cadillac's Mr. Howell said. They may be taking losses in their investment portfolios or on real estate, and are holding off on big purchases as a result, but they still have money in their budgets for a pricy vehicle.

Image also is a factor, he said. The "green" movement sweeping the nation has wealthier buyers thinking twice about a gas-guzzling SUV, but not because they can't afford the fuel.

"There's negative karma around SUVs," Mr. Howell said. He hopes a hybrid Escalade will ease some of those image problems.

GM also has hybrid versions of its full-size GMC Yukon and Chevrolet Suburban SUVs, which have struggled to gain momentum. Cadillac buyers may be more willing to pay the $3,600 premium for a hybrid, though.

"Now, if you go to a Cadillac store," he said, "there's no reason not to buy this."

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India will not buy Hummer Brand!!

74 MPG Mini Cooper Diesel

Hummer plans aggressive pitch for new H3T

Hummer plans aggressive pitch for new H3T

Hyundai's Luxury Gambit

Hyundai's Luxury Gambit

Ford to Sell $500 Million in New Shares

Ford to Sell $500 Million in New Shares

Tire Inflation Where to Get the Right numbers

Auto Makers Must Work Harder To Sell to Affluent U.S. Buyers

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