Peugeot breaks tradition with Tavares

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Philippe Varin swept into PSA in 2009 to prepare to prepare the French OEM for the current European economic malaise, and now his tenure is up.  In a move that is surely printing as much ink in the gossip pages in Paris as the economic journals, PSA has signed former Renault COO Carlos Tavares to take over.  This is just not done in Paris where niceties may be superficial, but are strong.  Well it’s been done now.  It may not be GM or Ford as Tavares had suggested in an August Automotive News interview, but leading a revival of near dead PSA presents a tantalizing and potentially highly rewarding challenge to the international auto veteran.

While Tavares may lack some of the product flair of his Nissan predecessor Patrickimages (2) Pelata, he corralled a Nissan organization that was lacking any top-level direction below CEO Carlos Ghosn.  At Nissan, he cemented the importance of U.S, product and sales discipline, and balanced Ghosn’s quest for market share Continue reading

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PSA, an existential outlook. UG or not UG

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Will PSA be here as a company in 5 years.  Sure it will, as a brand, company and equity.  But in what way shape or form seems to shift each day.  Six months ago the market was pretty hedged on that question, a couple of weeks ago they seemed to have a plan.  After Philippe Varin’s comments this week on “alliances” fear is creeping back.  So, is there an existential threat to PSA at least as an invest-able vehicle?

Worries over the partnership with GM dying out are overblown.  The real cost savings PSA-RADD2012-EN_01_img_58have always been closer to 2017-2018.  At the same time, Opel and PSA do have a number of areas where they can cooperate. Mr. Varin made it clear that while the B platform is “under review” the B- and C-MPV projects are Continue reading

Euro Auto Capacity Reduction: a snapshot and thoughts

Ford’s announcement today that the company will cut it’s Euro capacity by 15% or 350,000 units shows that Alan Mulally has shown the same courage he used to save Ford from the US auto bailout to his Euro operations.  Rather than prolonging the agony of Euro restructuring like so many other players, Ford has taken a decisive step.

Despite almost two years of bluster from continental players, no other make has closed more than one plant.  Even PSA, in its dire straights  Continue reading

Europe outlook: worry about 2013 not 2012

After spending the past 2 days talking with auto execs and investors in NY, it struck me as odd that the question of the day was “What’s your full year Europe outlook?” The real question is, what’s in store for 2013 in Europe.  It’s clear that the industry is in sync with a market down 6% for 2012, with more conservative companies looking closer to the 9-10% drop.

Clearly the drop is fueled by the Latin collapse in Italy, Spain and France and given July and August  — where France turned in a weak -11% performance — I think a negative 6-8% will remain the outlook, even through the Paris Auto Show at the end of this month. The real issue is not 2012.  I am hearing more and more concerns over continuing decline in Continue reading

Q2 2012 Global Auto Earnings: four not so obvious thoughts

While everyone is laser focused on the imploding European auto industry and we ponder the sustainability of the US volume recovery, there are a few things to keep an eye on that may not be top-of-mind:

1) Latin America: The meteoric growth of the Brazilian market has slowed to standstill and surrounding markets have stalled as well.  While the industry has expected the flattening market, a steep rise in  low-cost imports has created pricing pressure.  Companies like Fiat, GM and VW who had been enjoying the tailwinds of strong double-digit margins over the past decade will feel Continue reading

China 2012 Auto market, another two tiered year.

When I saw that China Q1 2012 auto sales were down 1.2%, I wondered was this the “soft landing” or just the beginning. After growing 32% in 2010, the market slowed to a “modest” 5.4% uptick for 2011, Q1 may be disheartening; however, March sales were “up a tad.” Well, I had the chance last week to spend some time last week with executives from the Chinese auto retail sector and looked a little deeper with a front-line perspective.

Following some takeaways from my listening:

  • The PV market is and has been bifurcated. The 2010 incentives to spur growth of local brands accelerated the spread versus global brands. This explains why Continue reading

Europe at the quarter

After 3 months we’re down 7.7% for Europe (27) markets. A bit worse than my -5% expectations and the bifurcation of German and Latin are even wider than I expected.

Germany +1.9%
UK +0.9%
Spain -1.9%
Italy -21%
France -21.6%

Continue reading