We'll Know By March If This Is A Good Or Bad Year For The Car Industry

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This is The Morning Shift, our one-stop daily roundup of all the auto news that's actually important — all in one place at 9:30 AM. Or, you could spend all day waiting for other sites to parse it out to you one story at a time. Isn't your time more important?

1st Gear: Just How Cold Is It?


Even with a slow December, 2013 will go down as a happy year for the auto industry. Most companies sold more, margins were up for lots of people.

What happened in January? Car companies who had off months — almost everyone who doesn't sell primarily AWD vehicles — blamed the cold. To their credit, I don't even want to walk downstairs to pick up the free cars they drop off for me to drive. I can't imagine walking car lots in this weather.


But what if it was a good month? Here's an interesting bit via Nick Bunkley:

But Brian Johnson, an analyst with Barclays Capital, said even when adjusting for the weather — he recalculated inventories assuming a January SAAR of 15.8 million — GM and Ford each still would have had more than 100 days' worth of vehicles, more than any month since early 2009.

Earl Hesterberg, CEO of Group 1 Automotive, said his biggest worry this year is the potential effect of high inventories on profit margins. Group 1 dealerships had a 72-day supply of new vehicles.

"There's no way you can have dealerships with that level of inventory without it impacting margins," Hesterberg said on a conference call.


Ford may curb that a bit as they wind down sales of the current F-150 in advance of the new one, but what of Chrysler and GM?

Something's gotta give. Either late Feb/March will be a face ripper or it's going to be a longer year than people expected.


2nd Gear: The Australian Car Industry Is Now Definitely Dead


We've called the Australian car industry "dead" multiple times because every new bit of news would inevitably lead to the next.

Ford said they weren't building cars there anymore, which led to GM pulling out, which led to the government ending subsidies which… well once Ford pulled out Toyota was probably already planning to end their production as well.


Australia is like that guy in Austin Powers getting slowly crushed by a bulldozer it sees coming, producing cars through roughly 2017 when Australia Toyota pulls the plug.


They don't have much choice. There's not going to be a supplier base nor are there going to be subsidies.

3rd Gear: Tata Making Money Hand Over F-Type


Tata's third-quarter profit just hit $771 million, up from the previous third quarter (they're on a fiscal calendar that's one-quarter off from most U.S. carmakers).

Where's that money coming from? As Bloomberg points out that's largely due to Jaguar Land Rover, which posted profits of about $1 billion.


Tata, on the other hand, saw a massive sales drop last year.

4th Gear: That Rich Dude From Hong Kong Really Wants Fisker


Hong Kong Billionaire Richard Li just hired former Ford exec Martin Leach as they try to snag Fisker out from under Wanxiang Group, which thought they were probably going to get it.

Per the WSJ:

Mr. Leach said in an interview that his job would be to get operations moving while new workers are hired.

"Clearly, there is an awful lot to be done with Fisker," he said. "We will assist in on-boarding all the necessary talent that is required and starting the process of engaging the suppliers and the dealers."


Huh. Both Wanxiang and Li's group said they'd restart production, I just wasn't sure I believed them.

5th Gear: Union Vote Still A Bigass Deal


As mentioned, the UAW showdown in Tennessee this week is a big ass deal. There's a Freep follow-up with some choice quotes from people involved.


Here's a typically southern lawyer with a typically southern name being typically "nice" about it:

"People here in the southern automotive industry point and say, 'We see the southern auto industry blooming,' " Nicely said. "We would be ignoring reality if we did not recognize that one of the reasons these automakers have chosen the Southeast has been because of the UAW and the impact it has had on the ... northern auto industry."


That's a remarkable ellipses. Can't you just hear the polite fear mongering?

Also, promoting what I said earlier that a couple of you took issue with:

Volkswagen previously said it was neutral. But in a statement Saturday, the automaker made it clear that it favors the formation of a "works council," which the UAW and Volkswagen are proposing to establish. In Germany, the works council represents employees on a wide range of internal matters. The union negotiates working hours, compensation and benefits.


Yeah, I think VW wants this as well.

Reverse: I Still Miss The Corvair

On this day in 1966, Ralph Nader, a young lawyer and the author of the groundbreaking book "Unsafe at Any Speed: The Designed-In Dangers of the American Automobile," testifies before Congress for the first time about unsafe practices in the auto industry.



Neutral: We Going To Turn Around In Feb/March? Or is the industry over-building?

Photo Credit: AP Images