31st October 2011

Lamborghini Gallardo R70 by Renown Auto Style

The 2011 SEMA Auto Show is hours away from opening and we’re finally getting a good look at some of the custom projects that have been prepared for the show.

For Renown Auto Style, this year’s SEMA participation marks the first time the company has ever attended with a car in tow. And for their first appearance, they picked a car that can catch attention the moment it arrives.

There’s something to be said about the appeal of the Lamborghini Gallardo considering it’s been around for a while now. The program, which is being billed as the R70, involves plenty of new aerodynamic modifications that RAS built completely from scratch without compromising the Gallardo’s already-beautiful aesthetic design. Both the front and rear bumpers carry unique designs that RAS built with careful attention paid on the certain parts of the Gallardo they had to work around to maintain the design integrity of the Italian supercar. All told, RAS added a bevy of aerodynamic features on the Gallardo, including new front and rear bumpers, an aggressive new rear wing, and a new set of custom-sized wheels. Take a good look at the Gallardo R70 and you’ll immediately notice the differences. The bumpers protrude further out, making for a more aggressive stance and a sleeker overall profile.

For first-timers in SEMA, Renown Auto Style certainly brought a car that would make it seem like they’ve been doing the same song-and-dance for years.

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31st October 2011

Official: Saab’s Chinese buyers commit over $850M in long-term funding

Saab may have finally been saved last week when Chinese companies Pang Da Automobile Trade Co. and Zhejiang Youngman Lotus Automobile Co. agreed to buy the Swedish automaker, thus providing some much-needed short- and long-term financing. Pang Da and Youngman purchased Saab for 100 million euros ($142M USD) and they are offering up a €50 million ($70M) bridge loan. Most importantly, the Chinese companies have now pledged €600 million ($854M) in long-term funding. That’s assuming, of course, that the Chinese government gives this deal its seal of approval – a very big “if.”

According to Saab’s restructuring plan, vehicle production will once again resume in Sweden and Mexico, though vehicles may be built in China in the future. Saab is keen to get its latest products – the 9-4X and 9-5 SportCombi – out to its key markets, and hopes to sell up to 55,000 units in 2012, with an even larger goal of moving 205,000 units per year in the long-term. That’s very optimistic, especially considering that in 2010, Saab sold just under 32,000 vehicles.

Even so, Pang Da and Yougman are confident that Saab can become a profitable company in the very near future. The restructuring plan states that 2012 and 2013 will be “financial transition years,” with full profitability expected in 2014. Follow the jump to read the full release.

Show full PR text

Zeewolde, The Netherlands, 31 October 2011 – Swedish Automobile N.V. (Swan) announces that Saab Automobile AB and its subsidiaries Saab Automobile Powertrain AB and Saab Automobile Tools AB (together Saab Automobile) today present their preliminary reorganization plan to their creditors during a creditors’ meeting in Vänersborg, Sweden.

The preliminary reorganization plan, which was developed by Saab Automobile management and supported by the current and foreseen owners of Saab Automobile as well as its administrator of the reorganization, contains the following highlights:

• Pending the approval from all relevant parties, short- and long-term funding for Saab Automobile is assured: Youngman and Pang Da have expressed their commitment to provide EUR 50 million, to fund Saab Automobile while in reorganization. In addition, the Chinese investors will provide a minimum of EUR 600 million in funding to restart production, to settle the company’s clear and due debts and to fund operations for the 2012-2013 medium-term timeframe. To provide funding for the revised business plan and provide long-term financial stability the new Chinese owners have also budgeted funding for the planned expansion of Saab Automobile’s portfolio and additional operations to be set up in China. Saab Automobile has not received the funds from Pang Da and Youngman that have been committed for today.

• New strategy and structure to combine the strength of Pang Da, Youngman and Saab Automobile, with Saab Automobile’s brand equity and heritage, product portfolio and capabilities being the key elements of that partnership combined with the distribution capabilities of Pang Da in China and the manufacturing expertise of Youngman.

• Key actions during reorganization: establish new ownership structure with Pang Da and Youngman as strategic partners; reach agreement with creditors on repayment of outstanding debt to restore Saab Automobile’s supply chain; reduce structural costs by SEK1 billion, among others through reducing headcount by 500 employees; and generally restore confidence and trust with all key stakeholders

• Restart plan highlights include: seamless production restart supported by existing order bank; accelerate access to China as major growth market; new distributorship agreements in other emerging markets like Russia, new products for traditional key markets (65% of volume) and China which include the 9-5 SportCombi and the 9-4X.

• Confirmation of the long-term strategy of repositioning Saab as a distinctive, near premium brand supported by a renewed and broadened product portfolio, a more flexible cost structure with global production footprint, cross-carline modular technology architecture generating synergies, provision of external engineering services and expanded operations to take advantage of growth opportunities available in China and provided by strong Chinese owners.

• Sales targets for 2012 of 35-55,000 cars and 2013 of 75-85,000 cars based on realistic ramp up in line with sales development since last restart.

• Long term volume outlook of 185-205,000 cars of Saab Automobile based on three main growth drivers: 1) broadened product portfolio in fast growing market segments; 2) capitalizing on access to Chinese market, and; 3) strong profitability focus.

• 2012 and 2013 seen as financial transition years, profitability expected no later than 2014. Long term margins and profitability in line with other near premium car manufacturers.

News Source: Saab, Automotive News – sub. req.

Image Credit: Olivier Morin/AFP/Getty

Category: China, Saab, Earnings/Financials

Tags: chinese automakers, pang da, pangda, saab, saab china, swedish automobile, youngman

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31st October 2011

Freaky Friday: Chrysler Helps Fiat, Chinese Save Saab?

In the business world, Friday is supposed to be casual, a day to talk and/or write about great drives and to browse bringatrailer.com or oldcarbrochures.com. Then again, sartorially speaking, every day is casual Friday for the new Alan Mulally, the besweatered Sergio Marchionne. Appropriate that he chose Casual Day to comb head-numbing financial numbers from Thursday’s Third Quarter financial results.

Meanwhile, halfway around the world — or on the other side of the world, depending on who really is in charge — comes word that Victor Muller’s Swedish Automobile, owner of Saab, has announced a deal to sell the struggling little Scandinavian automaker to the two Chinese companies that previously were going to simply bail it out.

Zhejiang Youngman Lotus Automobile Company and Pang Da Automobile Trade Company will buy Saab for 100 million euros, the equivalent of $142 million. The memorandum of understanding is valid through November 15, Bloomberg reports, which means that in half a month, we may see an entirely new scenario to save Saab.

Originally, the deal was for the two Chinese automakers to buy 53.9 percent of Saab, leaving Muller’s company with a substantial, though minority share. In recent days, Muller objected to Youngman and Pang Da’s bid to save Saab by purchasing the whole enchilada. That wasn’t supposed to be the deal. But the Swedish court overseeing Saab’s reorganization plan cancelled its reorganization, and by Friday, Muller apparently saw no other way to daylight. Saab hasn’t built cars in Trollhattan since late March, and ’12 model 9-4x production has yet to begin at GM’s Ramos Arizpe, Mexico, plant.

Saab’s court-appointed administrator had applied to the district court handling the reorganization to terminate the automaker’s restructuring, but withdrew the request for termination pending Saab’s final sale. Bloomberg quoted Saab spokesman Eric Geers as saying: “This is fantastic news.”

So the two Chinese companies buy all of Saab for $142 million, versus 53.9 percent of Saab for the equivalent of $346.6 million, and that’s “fantastic news”? Perhaps Geers gets to keep his job. He should, for that kind of spin. Problem is, Youngman and Pang Da still have to get the blessing of the Chinese government, which has been working to consolidate automakers in recent years. It’s still far from a done deal (see Sichuan Tengzhong and Hummer).

China’s National Development and Reform Commission, which must approve the deal, will look upon the two companies buying all of Saab for 100 million euros more favorably than the old deal, says Tim Colbeck, Saab North America president and COO. He expects the work the NDRC has completed in the last four to five months for the original deal to transfer directly to the new purchase offer. I hope he’s correct, though I’m skeptical this will all be wrapped up by November 15.

The purchase price for Saab is about $65 million short of Chrysler’s third-quarter net profit, announced Thursday. Chrysler Group made $212 million in the third quarter, following a $370 million second-quarter loss and a $116 million first-quarter profit. That’s small beer for a major automaker, though it means Chrysler needs just $42 million net profit in the fourth quarter to break even for 2011. Most of Chrysler’s numbers are going in the right direction, so like a much more modest General Motors, Mopar looks poised to be profitable with small cars leading the way in a slowly recovering economy.

For full-year 2011, Chrysler expects net revenues of more than $55 billion. It expects to end the year with a $2-billion+ modified operating profit. Its adjusted net income will be about $600 million, higher than an earlier estimate of $200 million to $500 million. That assumes a fourth-quarter net of nearly $650 million.

Chrysler’s most important model for 2012 is the 40-mpg+, Fiat-based Dodge compact, likely to be named “Hornet.” Marchionne said the new car will have a significant positive effect on Chrysler’s first and second quarters, next year. The car also gives Fiat another 5 percent of Chrysler, for a total of 57 percent, as arranged in the June 2009 Chrysler reorganization. The United Auto Worker’s retirement benefit fund owns the other 43 percent.

Here’s hoping Dodge can launch the Hornet with the same kind of success as the Chevy Cruze, and without the PowerShift transmission problems Ford has had with its new Focus.

Chrysler’s U.S. market share is now 11.4 percent, up from 9.6 percent a year ago. It’s even more significant that Chrysler has lowered its fleet mix in the U.S. from 34 percent a year ago to 26 percent today. Roughly 75 percent of its fleet consists of daily rental, for both numbers. Chrysler also has raised its average transaction price by $1,000 over a year ago, to about $28,000.

Incentives have had their ups and downs at Chrysler, where they averaged $3,600 per vehicle a year ago, down from a peak of $4,000 in the second quarter of ’10. It was as low as $3,000 for the second quarter of this year, and ended the third quarter at an average of $3,200. Lower, of course, is better.

Marchionne rejects the idea that the UAW retirement fund’s 43 percent interest in Chrysler had anything to do with a pretty favorable four-year contract ratified earlier in the week. Chrysler’s labor costs are roughly equal to the foreign, non-unionized transplants, about $51 per hour all-in.

So when will Chrysler be ready for an initial public offering?

“I wouldn’t do anything in today’s market,” Marchionne says about a 2013 IPO. That means we may get Alfa Romeos in the North American market, now due that year, before Chrysler issues an IPO.

Chrysler has buoyed Fiat’s financial fortunes in the last quarter. Fiat’s debt load was up in the quarter after Italian car sales fell to a 30-year low, according to Bloomberg. Marchionne indicates Fiat might move more operations to Auburn Hills, Michigan.

Italian company or American company? It doesn’t matter. Not in the way it seems to matter to Europe whether or not Saab is a Swedish, Dutch or Chinese company. Fiat and the U.S. and Canadian governments saved Chrysler, and now it’s paying off. Chrysler is hiring in an economy in which there are few jobs. The auto industry is labor intensive, and Wall Street doesn’t like labor-intensive industries, especially unionized ones.

None of this has come easily for Chrysler, though, and with Fiat and the Italian economy faltering, the company still has a long road to real health. Think about how hard it has been for Chrysler, the smallest of the Detroit Three, and that should tell you how much tougher the auto biz is for tiny companies like Saab.

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31st October 2011

Ford releases unpainted bodies for classic Mustang convertibles

Ford is offering unpainted body shells that can be made into’64 1/2,’65 or’66 Mustang convertibles, depending on the restoration parts and powertrain that the buyer installs during the rebuild. But unlike a restoration, the metal is new and the welds solid, making it a durable template for those wanting an alternative way to relive their youth.

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30th October 2011

Former Ford exec Bidwell helped revive Chrysler

Ben Bidwell, a Ford Motor Co. executive who later helped guide Chrysler’s revival in the 1980s, died Oct. 14 at age 84.

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30th October 2011

Sanders takes top prize at Cowtown Spooktacular

Rodney Sanders was the Topless USRA Modifieds feature winner.

By Don Cook
Fort Worth Star-Telegram

Cowtown Speedway (Kennedale)
October 29 (Saturday)

Rodney Sanders, #20, defeated Triston Dycus, #14t, for the $5,000 top prize at the Cowtown Speedway Spooktacular. Local Sean Jones, #24, took the early lead, but was passed after a few laps by Sanders. Triston Dycus came close, but was unable to pass Sanders and had to settle foe second. The hard charger award went to Cody Smith, #18s, who came from the back of the pack to take third. Randy Timms, #5t, and Bobby Ruffin, #121, rounded out the top five.

To view a video of the Topless Modifieds feature, click below:

Paul White was the winner of the Limited Modifieds feature, but was later DQ.

In the Limited Modifieds feature, Waco’s Paul White, #2w, was the winner, but was later disqualified, giving the win and the $3,000 to local Keith Martin, #164. Paul mentioned that it was a new car and they were having some brake problems. Ken Miller, #1m, was second and John White Jr, #8j, was third. 

Keith Martin was the winner of the Limited Modifieds feature.

A couple of Limited Modifieds get into it on the front straight.

To view a video of the Limited Modifieds feature, click on the video below:









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