Good morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know.
1st Gear: You Know Who’s Making America Great Again? Subaru
The American automakers are continually under fire for moving jobs, or appearing to move jobs with production shuffles, which few people outside the industry understand and tends to look bad. Do you know who’s not? Subaru, which is expanding its Indiana plant to build the next Impreza. At a time when small car sales are struggling, no less. The non-union plant makes 380,000 vehicles a year.
Via The Detroit News:
The carmaker announced earlier this year it is expanding its Lafayette, Indiana, plant to produce its all-new, fifth-generation Impreza compact. The Impreza made its testing debut to media here this month and is now arriving in dealer showrooms.
While political necessity often reduces trade issues to bumper-sticker slogans, the Subaru vs. Ford situation reflects the complex factors that drive plant location in a global market.
Though Subaru won’t give precise figures on how many Imprezas will roll out of its huge, 3.4 million-square-foot facility, the Indiana plant is expected to meet U.S. demand for the popular, all-wheel drive sedan and wagon. The non-union operation makes 380,000 vehicles a year (including Legacy sedans and Outback crossovers). The previous-generation Impreza was made in Japan.
“Subaru Indiana Automotive has a long history of building high quality vehicles,” says Senior Executive Vice President of SIA Tom Easterday. “Indiana has a very favorable business climate, many Subaru suppliers are located nearby, and we already have the administrative structure in place — so it made sense to expand SIA rather than build a plant somewhere else in North America.”
Get out there and buy a real American car, like a Subaru.
2nd Gear: This Again
While General Motors won the first group of so-called “bellwether” lawsuits related to the defective ignition switch in multiple vehicles linked to 124 deaths and 275 injuries, it is now asking the U.S. Supreme Court to reverse a lower federal court decision that stated “new GM” doesn’t get a bankruptcy-related shield from those lawsuits.
Basically, GM attempted to hide behind the bankruptcy to dodge lawsuits over the defect, but an appeals court decided otherwise. GM is asking the Supreme Court to reverse that. Here’s The Detroit News:
GM agreed to certain liabilities as it emerged as a new company in 2009 following its bankruptcy restructuring, but as a new company was protected from some liabilities related to the old company. That is known as its bankruptcy shield.
The new GM agreed to be liable for claims related to accidents occurring after — but not before — it emerged as a new company, even though the vehicles were built previous to that.
In July 2016, the federal appeals court ruled that ignition switch cases aren’t automatically barred by the company’s bankruptcy shield. It said GM did not allegedly provide adequate notice to possible creditors.
“We are asking the Supreme Court to review the Second Circuit’s ruling because the panel departed substantially from well-settled bankruptcy law that good-faith purchasers everywhere rely on to provide certainty and predictability in bankruptcy sales,” the automaker said in a statement.
The Supreme Court will decide in the spring whether to hear the case or not, which means this fiasco—and the bankruptcy—will be back in the news again. Great?
3rd Gear: GM Accused Of Running A Monopoly In China
Pot, meet kettle. Via Automotive News:
Investigators found the U.S. company had instructed distributors to fix prices starting in 2014, Zhang Handong, director of the National Development and Reform Commission’s price supervision bureau, was quoted as saying in the China Daily.
In an exclusive interview with the newspaper, Zhang said no one should “read anything improper” into the timing or target of the penalty.
The article did not give further details and the NDRC did not immediately respond to requests for comment.
China, the world’s largest auto market, has become crucial to the strategies of car companies around the world, including GM and Ford Motor Co .
In a statement, GM said: “GM fully respects local laws and regulations wherever we operate. We do not comment on media speculation.”
4th Gear: Can The C-HR Be ‘Fun’ And ‘Dynamic’?
Toyota’s kind of late to the crossover compact game—a game mostly filled with abysmally terrible-driving cars like the Chevrolet Trax—but it hopes the interesting-looking C-HR won’t suck. Via Automotive News:
The C-HR goes up against early entrants in the fast-growing subcompact crossover segment, such as the Honda HR-V, Nissan Juke and Subaru Crosstrek. U.S. sales of subcompact crossovers surged 31 percent to 455,771 vehicles through November in a flat overall market.
But Koba said the C-HR’s responsive handling puts it more in the league of the Ford Focus and Volkswagen Golf. Indeed, the Japanese carmaker undertook early development of the C-HR in Europe to better tune its driving dynamics to Europe’s winding roads and high-speed highways.
Prototypes have been tested around Germany’s Nurburgring race circuit since 2013.
“It offers crisp clean driving like a hatchback,” Koba said.
The C-HR is being positioned as a global nameplate and will be sold in more than 100 markets. But Japan and Europe are expected to be the volume leaders, Koba said. Hybrid variants, using essentially the same system as in the Prius, will be offered in Europe and Japan.
5th Gear: Get That Money Carlos
With the Mitsubishi acquisition, Nissan-Renault CEO Carlos Ghosn gets even more money. Via Reuters:
Nissan Motor Co Ltd (7201.T) and Renault SA (RENA.PA) CEO Carlos Ghosn is set to receive a third salary after Nissan-controlled Mitsubishi Motors Corp (7211.T) on Wednesday approved the Frenchman as its chairman along with a tripling in compensation for board members.
Shareholders voted in favor of raising the ceiling on combined annual compensation for Mitsubishi’s 11 internal and external directors to 3 billion yen ($26.06 million), including 2 billion yen in salary and 1 billion yen in stock options.
Mitsubishi has revamped top management and appointed Ghosn to head its 11-member board after Nissan in October took a 34 percent controlling stake in Japan’s sixth-largest automaker, which is struggling to recover from a mileage-cheating scandal.
Good for him! He runs three car companies now, the dude’s busy and clearly works hard!
Reverse: The Brickyard
Neutral: Does It Matter To You If A Car Is Built In America?
Not all Fords are. My old Toyota was. Does this make a difference to you as a buyer?