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Ford decides to keep Geelong engine plant open

The announcement reverses the company's decision last year to close the engine plant by 2010 - cutting 600 jobs.

Ford Australia today said it would invest $21 million in the plant developing an engine that would meet Australia's first European emissions standards.

Today's announcement added to the $200 million Ford had previously invested in facilities and product development at Geelong since 2006, the company said.

"This decision is good news, not only for our employees in Geelong, our suppliers and the surrounding community, but also for the many fans of our I6 engine, which will now be re-engineered to achieve Euro IV emissions standards,? Ford Australia president and chief executive Marin Burela said.

"This is the first step in a broad product investment strategy to reduce emissions and deliver improved fuel economy across our locally built vehicle line-up, including Falcon, Falcon Ute and Territory.?

Ford said the retention of the engine plant was expected to provide an on-flow of business to local service providers, in addition to the direct employment boost for the Geelong region.

It also said the Federal Government's new Green Car Innovation Fund provided a framework for the company to investigate additional environmentally-oriented product investment initiatives to increase future competitiveness.

LA Motor Show opens quietly

But that is no surprise with the heads of the Big Three carmakers all skipping the event to continue lobbying for a $US25 billion lifeline from congress in Washington.

Ford still splashed with the official introduction of the 2010 Mustang, but Chrysler and General Motors both wound-back their involvement in the second-biggest car show in North America.

That left the way clear for the imports, with Mazda pulling the cover off its all-new Mazda3 - the last car it will develop with Ford as its owner - Nissan revealing its revitalised 370Z and a new Cube, and Honda revealing a radical looking new concept coupe called the FC Sport.

Lexus also has a new RX SUV, which is being simultaneously unveiled in Sydney and will come as both a pure petrol car and a hybrid, Hyundai is showing a Sonata hybrid concept and the plug-in Mini E electric car is making its first public appearance.

The LA show usually draws a crowd of more than one million visitors but the attendance is expected to be well down this year with car sales off by more than 35 per cent in October and America's annual selling rate down by closer to 40 per cent.

Still, cars like the Mustang will still draw a crowd in a city which is one of the most automobile driven in the world and there are plenty of pointers to the future including a growing number of electric cars led by the Mini but including concepts from Chrysler.

 

Honda?s wildest concept

The Honda FC Sport Concept shows how far the company can push its hydrogen-power plans, packing an on-board electric generator under the skin of a three-seater supercar.

"This is as radical as Honda has ever gone," says one company insider at the show.

"They won't build this car but it shows their commitment to the fuel cell concept. And the sort of things you can do."

The FC Sport Concept is much more radical than any of Honda's upcoming hybrid cars, including the born-again CR-Z which will go into production alongside the second-generation Insight family hatch, and was designed and built in California.

Apart from its tiny body and minimal overhangs, the big difference in the FC car's layout is a three-seater cabin which puts the passengers into an arrowhead formation, just like the McLaren F1 supercar of the 1990s.

"The Honda FC Sport explores how to satisfy automotive performance enthusiasts in a world beyond petroleum. People who love sports cars will still have a reason to love them in a hydrogen-powered future,"

says American Honda's executive vice-president, John Mendel.

Horse power: 2010 Mustang

The original pony car from the 1960s became a 2010 model today at the opening of the Los Angeles Motor Show with everything you would expect of a Mustang.

It has all the familiar keys expected in a Mustang, from the basic shape to a V8 under the bonnet, but has been tweaked and primped for a new edition. It runs on bigger wheels, with a smaller-looking body that is softer around the edges, and also has a new-generation V8 promising more go from less fuel.

And to meet a growing band of rivals led by the Aussie-made Chevrolet Camaro.

The Camaro and Dodge Challenger have been brought back from the dead, after also starting their lives in the muscle car era of the 1960s, as more and more Americans look for the car they could never afford in their youth.

In the case of the Mustang, there are high hopes for a car which is now celebrating its 45th birthday and is the halo car for the whole blue oval brand.

"We wanted to take it to the next level. Aggressive, muscular and athletic," says the Mustang's chief engineer, Paul Randle.

The Mustang has shared top billing at Ford alongside the F150 truck but, with the recent downturn in demand for pickups and SUVs, the muscle car now sits alone. And Ford knows it has to fire.

Chief designer J Mays says the 2010 Mustang is right-sized and done right for the 21st century.

"We managed to make it look smaller than Camaro and Challenger," Mays says.

The mechanical package includes wheels as big as 19-inch alloys, standard stability control, an optional 4.6-litre V8 and - best of all for Mustang fans - the potential for major upgrades by tuner companies including Shelby.

But the basic mechanical package is as basic as always - trailing well behind the FG Falcon in its chassis design and tuning - and there is no chance of the car becoming an official model in Australia.

The last Mustang move Down Under was a disaster, once enthusiasts had claimed the first cars, and so the only 2010s likely to hit Australian roads will be private imports which have been converted to right-hand drive by local specialists.

 

Big Three call for rescue in US

General Motors, Ford and Chrysler are arguing for their share of the rescue money provided by the American government as they continue to suffer the biggest losses in motoring history.

The Bush administration opposes their call for cash but a bill has been presented by the Democratic party to the country's Congress, which is also in transition following the landslide win by president-elect Barak Obama, to give them some short-term relief.

If any deal is approved - which seems a longshot - it will include a provision that none of the money can be used to pay executive bonuses.

These have been a multi-million dollar windfall for most senior executives at the Big Three for decades, but look to pass into history - at least until the river of red ink in Detroit is damed.

The proposal for the $25 billion assistance package has created a political furore in the USA, where one side of politics says the Big Three only have themselves to blame and the other is trying to protect jobs and even the pension and health insurance entitlements of retired workers.

A USA Today-Gallup poll shows the split, as a 47 per cent of adults said they believe loans and other help for carmakers is "not that important".

Meanwhile, everything from paperclips to concept cars has been culled as General Motors fights for survival.

The one-time world leader, which is now certain to be overtaken by Toyota on the 2008 sales charts, has slashed all non-essential spending and has even withdrawn from the Los Angeles Motor Show later this week.

GM was planning to unveil a new Buick concept car and something exciting for Saab, but has pulled both cars and also decided to keep its senior executives away from the California car show.

Ford and Chrysler are also expected to go low-key in LA, leaving import brands including Nissan and Mazda - which will reveal their all- new 370Z and Mazda3 - to make the running.

But it is the GM cutbacks which are making news in the USA, as the company - which is losing billions each month - reduces spending on everything from stationary to company cars. It has cut all executive bonuses and raised prices for executive lease cars.

GM has admitted it will run out of cash reserves by the end of the year.

Chrysler has also eliminated bonuses and is pushing e-mail to save on paper costs, while Ford is not having any Christmas parties in 2008 and has slashed all non-essential staff travel.

 

Record Aussie sale

The 1963 F1 world championship-winning Lotus 25 driven by Jim Clark brought $1,525,500 (including buyer’s premium) after spirited international bidding at the Bonhams and Goodman sale in Sydney yesterday.

"It is certainly a world record for a Lotus and we believe it to be an Australian record for any car," Bonhams and Goodman's Robert Glover said.

"The really nice story is that we had bidders from Japan, the United States and Europe but the car is staying in Australia."

Mr Glover said the buyer was a "known keen enthusiast" but had requested confidentiality on the sale.

Against predictions of recession-hit bidding Mr Glover said the sale had realised $5.2 million, a 90 per cent clearance rate by estimated value.

"The sales were still very much driven by passion rather than any attempts to recession-proof," Mr Glover said.

He said that while rarity was what made many of the lots so attractive, buyers who desired one of the cars or bikes at the sale were prepared to go to great lengths to obtain them.

The record breaking Lotus was the jewel of the John Dawson-Damer collection.

Dawson-Damer was killed competing in a Lotus at the Goodwood festival in England in 2000 and his collection of six historic Lotus cars went under the hammer at the weekend.

 

Ford selling out

Just as General Motors has bailed out of Suzuki to raise more than $350 million, the blue oval brand is hoping to make more than $700 million from its new move.

It is reducing its stake in Mazda from 33.4 per cent to just over 13 per cent, in a move announced yesterday in Detroit.

The potential sale was first raised more than a month ago but, at the time, Ford refused to confirm any cut in its Mazda shareholding.

But further financial troubles in the USA, where Ford has joined calls for a major $US25 billion government bailout, has forced it to move.

There is no single buyer for the Mazda shares, but Japanese reports are pointing to a buy-in by the Sumitomo and Itochu trading houses and other financial institutions.

However Mazda is looking to buy back a significant stake in its own future and has emerged as one of the biggest bidders.

"It's good to be able to buy back your own shares," the spokesman for Mazda Australia, Glenn Butler, says in Los Angeles ahead of the global unveiling of the new Mazda3 tomorrow.

Ford became Mazda's saviour in the late 1980s when the company became a victim of over-ambitious expansion plans and the Asian economic meltdown. It was already a significant shareholder but took outright control when it expanded its stake to 33.4 per cent.

The Ford move came at around the same time as former president, expatriate Australian Jac Nasser, was also buying up Jaguar, Land Rover and Aston Martin to create the one-time Premier Automotive Group.

Ford has since sold-off its British assets, most recently to Tata of India, but company chief Alan Mulally said recently in Australia that there was no plan to jetison Mazda.

But that has changed with the American automotive crisis.

"Ford is looking to sell around 20 per cent of the company. Once Mazda has its share, the rest will go onto the open market," says Butler.

"But there are three or four key buyers lined up in Japan. It will be interesting to see what happens."

In any case, he sees minimal change in Mazda's strategic direction or the company's operation in Australia.

"Mazda and Ford's strategic relationship will continue into the forseeable future," he says.

 

Mobile danger

Thousands of pedestrians are risking death and injury every day by using mobile phones and MP3 players while crossing busy roads.

NRMA Insurance research shows that a significant number of pedestrian/car accidents are the result of people using technology on the run.

"The main concern is that the technology forces us to split our attention between two tasks, which can be dangerous if were crossing or exercising on busy roads," NRMA Insurance spokesperson John Hallal said.

"If you're listening to an MP3 player while walking, you're not likely to hear what's happening around you. Hearing is important for pedestrians, especially those using roadways to exercise because it can alert them to approaching danger.

"Warning noises like car horns and emergency sirens are used for a reason and they need to be responded to quickly."

Mr Hallal also said mobile phones could be as big a distraction for pedestrians as they are for drivers.

"Talking on a mobile phone can cause pedestrians to take unintentional risks on the roads such as crossing against a red signal or stepping out between vehicles.

"Most people have seen examples of pedestrians who are talking on their mobile phones and just walk out into the path of an oncoming car because their attention is on the conversation rather than on the traffic," he said.

Texting is a particular risk as most people look at their mobile screens to either read or send the messages.

"We recommend pedestrians don’t use MP3 players while walking or jogging in busy traffic and stop to have a conversation on a mobile or write a text," Mr Hallal said.