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GM officially bankrupt – US$30b bailout

June 2nd, 2009 16 Comments

In one of the most significant moves in the automotive industry General Motors Corporation has finally filed for bankruptcy.

The move forces the 100-year-old carmaker once seen as a symbol of American economic might and dynamism into a new and uncertain era of government ownership.

The bankruptcy filing is the third largest in US history and the largest ever in US manufacturing.

Reuters newsagency says the decision to push GM into a fast-track bankruptcy and provide US$30 billion of additional taxpayer funds to restructure the carmaker is a huge gamble for the administration of President Obama.

In a sign of progress in the government’s high-stakes effort, a bankruptcy judge approved the sale of substantially all of US carmaker Chrysler’s assets to a group led by Italy’s Fiat SpA in an opinion filed late on Sunday.

GM’s bankruptcy, which was approved by the automaker’s board after a weekend of deliberations, is the most carefully orchestrated Chapter 11 filing in the history of American business.

The automaker’s final descent started with an emergency aid announcement by the administration of President George W. Bush on December 19. It accelerated in late March when the new Obama government gave the company 60 days to restructure.

Following the bankruptcy filing, GM shares were removed from the Dow Jones industrial average and delisted by the New York Stock Exchange as “no longer suitable for listing.”

Chrysler’s bankruptcy, also financed by the US Treasury, has been widely seen as a test run for the much bigger and more complex reorganisation of GM.

President Barack Obama said that concessions by United Auto Workers union and creditors achieved a viable and achievable plan for GM to complete its restructuring and have a chance to succeed.

“I am absolutely confident that if well-managed, a new GM will emerge that can … out-compete automakers around the world and that can once again be an integral part of America’s economic future,” President Obama said.

The administration’s ambitious plan for GM is for a quick sale process that would allow a much smaller company to emerge from court protection in as little as 60 to 90 days.

In bankruptcy, GM will divide in two: a leaner “New GM” and “Old GM” — which will include the parts of GM that will eventually be liquidated.

GM said the split would be accomplished through what is called a Section 363 sale.

New GM assets would transfer to an entity owned by the US and Canadian governments, the UAW and GM’s unsecured creditors.

GM said in court documents that the Section 363 sale has to be quick as the US Treasury has made clear it will finance New GM only if the sale transaction is approved by July 10.

“Now the hard part begins, which is making GM and Chrysler competitive. If they don’t do that, then we’ll be doing this all over again in a few years,” said Christopher Richter, an auto analyst at CLSA Asia-Pacific Markets in Tokyo.

“The immediate implication is that the companies are going to get smaller and so market share is up for grabs, which means that rivals like Toyota, Honda, Nissan and Hyundai are going to gain share.”

Indeed, one of GM’s major challenges will be to create a streamlined offering of vehicles that are affordable, stylish and fuel-efficient.

Since the start of the year, GM has been kept alive by US government funding as a White House-appointed task force vetted plans for a sweeping reorganisation that will be undertaken with US$50 billion in federal financing.

By taking a 60 per cent stake in a reorganised GM, the Obama administration is gambling that the carmaker can compete with the likes of Toyota after its debt is cut by half and its labour costs are slashed under a new contract with the UAW union.

The federal government of Canada as well as the province of Ontario agreed to provide another US$9.5 billion to GM in a late addition to the plans for the bankruptcy.

GM plans to close 11 US facilities and idle another three plants. It has not provided an updated target for job cuts but had been looking to cut 21,000 factory jobs from the 54,000 UAW workers it now employs in the United States.

“The GM that many of you knew, the GM that that let too many of you down, is history,” said CEO Fritz Henderson at a news conference.

“Today marks the beginning of what will be a new company, a new GM dedicated to building the very best cars and trucks, highly fuel-efficient, world-class quality, green technology development.”

The UAW would have a 17.5 per cent stake in the New GM. The Canadian government would own 12 per cent and GM bondholders would receive 10 per cent.

US officials said there was no plan to provide any further funding for GM and insisted that all of the Detroit Three could survive. Ford Motor Co has not sought emergency federal aid.

In the case of GM, the goal of restructuring is to allow it to return to profitability if US industry-wide car sales recover even slightly to near 10 million units annually.

While New GM is expected to emerge quickly from court protection, its shuttered plants, stranded equipment and other spurned assets would be left to liquidation in bankruptcy.

Founded in 1908, GM rose to dominate the US and global car industries under the stewardship of pioneering Chief Executive Alfred Sloan, who famously pledged that the carmaker would deliver “a car for every purse and purpose.”

By the mid-1950s, at the peak of its success, GM had some 514,000 employees and it accounted for about half of US car production

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Toyota F1 team selling serious go-fast bits

May 30th, 2009 17 Comments

The race merchandise kiosk just got a whole lot more exciting with Toyota’s Formula One team set to offer high-tech parts from its past racing cars alongside the familiar caps, shirts and key rings.

Almost everything will be available for the public to buy from real carbon fibre wings to brake callipers and alloy wheels – at a disturbingly reasonable price.

Opel future hangs in the balance

May 28th, 2009 13 Comments

The fate of Opel/Vauxhall, the beleaguered European subsidiary of General Motors, hangs in the balance after 12 hours of talks broke down with GM revealing the company needed an extra 300 million Euros (US$415 million) to survive.

By David Twomey in Berlin

At the same time the talks did narrow Opel’s suitors down to two companies, Italian carmaker Fiat and the Canadian parts supplier Magna, when bids by Belgium-listed holding RHJ International SA and China’s Beijing Automotive Industry Corporation were rejected.

Fiat’s race to win control of Opel is part of Chief Executive Sergio Marchionne’s ambitious attempt to build an automotive alliance that could rank as the world’s second largest by sales behind Japan’s Toyota Motor Corporation.

Fiat has an ambitious plan to fold Opel and other GM Europe brands Vauxhall and Saab into a transatlantic car empire that would also include new US partner Chrysler.

German ministers said after more than 12 hours of talks stretching well into Thursday morning here, that they had been unable to reach a deal to provide Opel with temporary financing if GM files for bankruptcy in the United States.

“We have made demands on the U.S. Treasury and expect answers by Friday and we will need these answers in order to agree a plan,” Economy Minister Karl-Theodor zu Guttenberg said.

“We don’t have the security yet that we need to commit to bridge financing today.”

Finance Minister Peer Steinbrueck spoke of “surprises and disappointment” with the US negotiators, saying GM had shocked participants by announcing it needed 300 million Euros (US$415 million) more in short-term cash.

Choosing a final bidder for Opel and closing a deal could take months, time that neither the carmaker nor the German government have with GM expected to file for bankruptcy in days after a crucial bond exchange proposal failed.

To tide Opel over, Germany has put together a 1.5 billion Euro (US$2.1 billion) aid package, but has made this aid contingent on the US government and GM agreeing to its plan to temporarily place Opel assets in a trust, a move that would protect its patents and technology from GM creditors.

Mr Steinbrueck said he was hopeful a deal could be reached on Friday that would save Opel.

German Chancellor Angela Merkel had called the meeting to agree a plan to keep the carmaker running while negotiations with suitors are finalised

Opel traces its roots in Germany back to the 19th century and employs about 25,000 staff in four plants here. Its future has become the focus of a furious politically charged debate in Berlin ahead of a federal election in September.

The German led talks have caused some disquiet in other European capitals with leaders in Britain and Belgium complaining that the Germans are ignoring the 30,000 Opel/Vauxhall workers who are employed in countries outside of Germany.

In defence of the Germans it must be said that they are the only ones to have made any attempt to work out a solution for Opel/Vauxhall.

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2009 Toyota Aurion Touring Special Edition

May 26th, 2009 156 Comments

Toyota has released a new special-edition model into the Aurion range to celebrate the company’s 50th anniversary in Australia.

The Aurion Touring Special Edition carries the same price tag as the entry-level Aurion AT-X sedan yet offers more than $2700 worth of additional standard equipment.

Toyota boasts 80,000 Prius pre-sale orders

May 19th, 2009 32 Comments

Toyota has announced the pre-sale orders of its new generation Prius following strong competition from fellow Japanese rival Honda whose Insight became the first hybrid ever to top the best-sellers’ list in Japan last month.

With the Prius set to debut in its home country first, Toyota is counting more than 80,000 pre-sale orders in Japan alone ahead of the start of sales on Monday in Japan, where it aims to sell 10,000 vehicles a month.

Toyota loss balloons to US$8.6 billion

May 9th, 2009 67 Comments

Showing that even the apparent mighty are not immune in the current financial times, the world’s biggest car maker, Toyota, has forecast a much bigger than expected loss of US$8.6 billion.

Toyota Motor Corporation, announcing its latest results in Tokyo, said it would also sell about one million fewer vehicles this year, leaving it desperately trying to cut costs in the grip of a severe market downturn.

The global crisis that has battered demand for cars and pushed US rival Chrysler into bankruptcy has hit Toyota hard, reversing its rapid expansion into overcapacity almost overnight.

Reuters Newsagency says that currently dozens of Toyotas factories stand half idle.

The Japanese giant posted its first-ever consolidated operating loss last year after a record profit the year before.

For January-March, Toyota piled up a $6.9 billion loss, in line with most estimates, and cut its annual dividend by nearly 30 per cent, the first cut since at least 1994, when it changed its reporting period.

While the entire industry is caught in the slump and seeking to offload cars piled up in stockyards, Toyota has been especially vulnerable due to its exposure to the United States and Japan, where sales have plunged to unpredicted lows.

Reuters says that even in China, where the market has risen, Toyota has bucked trend with a fall so far this year.

“Toyota’s outlook was worse than I’d expected. The company expects a really tough time for the first six months,” Reuters quotes Naoki Fujiwara, a fund manager at Shinkin Asset Management, as saying.

“I expect the bottom for the auto industry is the April-June period, followed by a slow recovery.”

Toyota President Katsuaki Watanabe was more downbeat, stopping short of predicting when sales would pick up in major markets, or when the company would return to profitability, as it remains saddled with excess capacity.

In a rare Toyota admission of failed decision making he told a news conference: “Of course the external environment doesn’t help, but we were lacking in the scope and speed of dealing with various problems and issues, and for that I am sorry.”

For the year to next March, the maker of the Prius hybrid forecast an operating loss of 850 billion yen, more than double the average forecast in a survey of 20 analysts by Thomson Reuters.

The bleak forecasts prompted ratings agency Standard & Poor’s to downgrade Toyota’s long-term debt ratings to AA from AA+, with a negative outlook.

Toyota said it expected its global sales, including subsidiaries Daihatsu and Hino but excluding cars sold by joint ventures in China, to fall about 14 per cent in 2009/10 to 6.5 million vehicles.

Mr Watanabe said that would knock 800 billion yen off the operating level this year, which Toyota aims to offset with cost cuts.

To return to profit, Toyota must sell more cars or cut costs further, Mr Watanabe said. But he predicted the US market would be around 10 million vehicles at best this year, down from more than 13 million in 2008.

Toyota is hoping the launch this year of a third-generation Prius will ease some of its sales slide and production cuts, even though it is cutting the price of the popular model to bring it closer to Honda’s new Insight hybrid, meaning its contribution to profits would be smaller than planned.

Domestic rival Honda Motor Co last week forecast a small profit for this year thanks to its relatively healthy motorcycle business.

“Compared with Honda, Toyota has a lot of larger models and a lot of excess capacity globally,” said Koichi Ogawa, chief portfolio manager at Daiwa SB Investments.

“By 2010, cost cutting and capacity reduction may be taking effect, so they could break even then.”

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Car sales drop again in April

May 5th, 2009 47 Comments

New vehicles sales in Australia officially dropped 23.9 per cent in April continuing a trend of recent months, but car companies are starting to become more confident that the market will turn around in the next few months

Official VFACTS data released by the Federal Chamber of Automotive Industries (FCAI) shows that 63,965 passenger cars, SUVs and commercial vehicles were sold in April, down 23.9 per cent or 20,096 vehicles, compared to the same month in 2008.

Study says Toyota world’s most valuable automotive brand

April 24th, 2009 110 Comments

Toyota has moved into the top 10 of the world’s leading 500 brands, according to a study by international consultancy firm Brand Finance.

The Global 500 report said Toyota retained its status as the world’s most valuable automotive brand as well as being the premier Asian brand.

2010 Toyota Prius US pricing announced

April 22nd, 2009 15 Comments

The redesigned 2010 Toyota Prius hybrid goes on sale in the US from late May with Toyota today announcing pricing will begin at US$22,750 – which in an ideal world would mean an Australian price tag of $32,560.

A stripped-down base model version will join the line-up late this year for just US$21,750 (A$31,130).

The third-generation Prius comes with a 1.8-litre four-cylinder engine producing 73kW which combined with the car’s electric motor can produce a total of 100kW.

2009 Nissan Maxima – First Steer

April 21st, 2009 55 Comments

2009 Nissan Maxima – First Steer

The Nissan Maxima has always seemed a little bit of a mystery to most people.

I mean sure the public was always aware of its presence, but for the man on the street the Maxima was always thought of as just “there”, quietly sitting in a niche all of its own, seemingly content with its place in the world.

It was almost as if it was seen as too good to be the daily lugger, but by the same token, it wasn’t really a fully fledged luxury car either.

Perhaps then it could be said the market was confused by the Maxima’s intended purpose.

Think about it this way, it was never as common as the Subaru Liberty or Toyota Aurion, but that’s not to say it was any less capable. It certainly had a lot going for it in terms of both power and economy, and could rival both with relative ease, but was is too big?

Similarly it was quite affordable when you considered the size of the vehicle, the equipment on offer and the smooth V6 performance availed, though it seemed more buyers were drawn to the similarly priced Honda Accord V6 or, to a lesser degree, the now deceased Mitsubishi 380. So did that mean it was a failure?

Hardly. I mean the Maxima always sold in very steady numbers, in fact it averaged 250 units a month across its life span, no mean feat! A fact bolstered by the fact that only 32 examples of the current model remain available for sale Australia wide.

It was a good drive too, and a rather comfortable ride, and from a design point of view it was “safe”, and managed to hold its own for almost five years with little in the way of modification or manicure.

Maybe then the car’s marketing was flawed. Aimed towards a demographic undeserving of its true worth, too subtle for such a well-deserved engineering effort. I mean even Nissan admits the previous Maxima was “especially popular” with the over 50s.

For those reasons alone the Maxima was always a little bit more highly aspired than its rivals, something to work towards, and perhaps that meant it was time for a change, time to make the Maxima more accessible, more competitive and more thoroughly suited to the challenges it would be presented with over its life span.

So, what’s changed? Well for a start the all-new 2009 Nissan Maxima now comes with a choice of two V6 engines and ergo, aggressively competitive pricing.

In a bid to tackle the competition we’ve just discussed above head on, and perhaps the rear-wheel-drive Holden and Ford camps simultaneously, the Maxima now positions itself in a two-tier structure, in much the same way Toyota does with its Camry and Aurion models or Honda with its Accord Euro and Accord V6 range – though cleverly for Nissan, this is all achieved within the one smart and sporty package.

Based on a completely new “D” segment platform, common to the new Nissan Murano SUV, the Maxima is completely new from the ground up, but perhaps importantly to prospective retained buyers, is evolutionary in style so as not to be too rapid a departure from the familiar styling so favoured by current owners wishing to update.

It’s more refined, more highly equipped – even in standard form – and more capable, or as Nissan sums it up: Modern Elegance.

Nissan’s Chief Executive Officer, Dan Thompson explains:

“The new Maxima will play an increasingly important role in the large and medium car market by offering the best blend of distinctive luxury – at an attainable price,” said Mr Thompson. “We are doubling the appeal of the new Maxima in Australia with our new two-engine model strategy and a very attractive entry price.”

“The new 2.5-litre V6 engine, the sharp pricing right in the heart of the four-cylinder market and the unprecedented high level of luxury features as standard, makes the Maxima 250 ST-L unbeatable. For a start, no one else in this market sector offers leather upholstery as standard. We are making four-cylinder large car customers an offer they can’t afford to ignore in the Maxima ST-L,” he said. “And with the elegant Maxima ST-S and Ti sedans, an impressive ride and luxurious appointments will give the new Maxima the muscle to grow its sales in the upper end of the large car market where there are many customers looking for unparalleled value.”

The familiar six-window coupe-like profile too has been retained, though now with a more pronounced character line that runs the length of the vehicle.

Proportionally the car is quite similar to the out-going model as well, though this time offers more internal room by featuring a floor some 36mm lower than the model it replaces, creating more headroom, and by moving the “A” pillar forward 60mm to provide not only more cabin space, but greater forward visibility too.

LED tail lamps and Xenon headlamps are also now standard across the range, as are 17-inch alloy wheels and Nissan’s acclaimed Xtronic CVT (continously variable transmission) gearbox.

The car too has had a great deal of Australian input in its design and suspension set up, and this is evident in driving the car on our much maligned back and often inimical country roads.

But to get a better understanding of the range, perhaps it’s best to break the new Maxima down model-by-model in order of rank, starting with the base model 250 ST-L.

Nissan J32 Maxima 250 ST-L ($33,990)

Pics to follow

Perhaps the biggest change to the Maxima line-up as a whole is the introduction of the smaller VQ25DE 2.5-litre V6 engine to the range.

This award winning power-plant is featured exclusively in the 250 ST-L and is a free revving unit that is quite smooth and linear in delivery managing 134kW at 6000rpm.

Power delivery comes courtesy of Nissan’s Xtronic CVT (automatic) transmission that keeps the car within its torque range long enough to utilise the 228Nm on hand at 4400rpm under steady acceleration.

Once on the open road the engine is barely noticeable in terms of noise, something Nissan have gone to great lengths in improving across the new J32 series, and also manages exceptional fuel economy at just 9.5-litres per 100km as a combined average, that’s 0.5-litres less the Toyota’s four-cylinder Camry.

Handling is confident, and on the whole more dynamic than the previous model, though as you’d expect the car’s front-wheel drive characteristics are more noticeable towards the car’s upper limits.

The ride is more refined too, feeling more settled and offering greater comfort levels than I recall of the previous model.

The J32 Maxima, featuring an all-new platform, is now suspended by an all-new strut-type front and multi-link rear arrangement both with stiffer mounting points to further improve body stiffness and at the same time reduce NVH levels.

It’s a great improvement over the Maxima’s more wallowy predecessor and thanks to an increase in torsional rigidity of 40 per cent and front lateral stiffness of 85 per cent – thanks in part to a new X-shaped cowl top structure – the new Maxima feels more sorted and purposeful when cornering with little in the way of that “front heavy” feel usually associated with larger front-wheel drive vehicles.

Steering too has seen an improvement over the previous generation with a new speed sensitive hydraulic system offering more in the way of feel at higher speeds, though is still weighted well enough to not be vague when tackling narrow country roads with poorly maintained shoulders as found on our drive route. A turning circle of 11.4 metres is uniform across the Maxima range.

The leather wrapped wheel is quite narrow of grip and unfortunately only offers tilt adjustment. It also features remote audio and cruise control buttons.

The 250 ST-L includes a comprehensive array of kit including ABS with EBA & EBD, ESP, six airbags, dusk sensing xenon headlamps, front and rear foglamps, LED tail lamps, black leather trim, cruise control, dual-zone climate control air-conditioning, power folding mirrors with integrated indicators, an 8-way electric driver’s seat, 4-way electic passenger seat, six CD tuner with MP3 compatibility and an auxilary input, push-button start and 17-inch alloy wheels (including full-size alloy spare).

Nissan expects this newly formed rival to compete directly with Camry and Liberty models and projects the 250 ST-L model to account for around 40 per cent of its overall sales.

Nissan J32 Maxima 350 ST-S ($37,990)

Pics to follow

Adding to the 250 ST-L’s comprehensive feature and specification list, the 350 ST-S presents itself as the next step up and the first of the 3.5-litre V6 powered Maximas in the new J32 range.

Perhaps set to rival Toyota Aurion, Honda Accord V6 – and even Ford Falcon XT and Holden Commodore Omega – in terms of price, the 350 ST-S offers an additional 15kW of power from the previous model as well as a 6 per cent improvement in fuel economy.

The engine is a revised version of the same VQ35DE 3.5-litre V6 as found in the previous model, but is both smoother and more capable delivering 185kW of power at 6000rpm and 326Nm of torque from 4400 revs.

Again mated to Nissan’s Xtronic CVT transmission, the 350 ST-S is a very capable performer with brisk acceleration both from standstill, and during overtaking, yet still manages excellent fuel economy at a claimed 10.2 litres per 100km.

As found in the lower spec 250 ST-L, the 350 ST-S also offers ABS with EBA and EBD, ESP and six airbags while inside, and in addition to those features listed on the 250 ST-L, the mid-level Maxima gains a rear spoiler and rear park assist, intelligent key system and heated front seats.

Nissan has indicated the 3.5-litre powered models will account for approximately 60 per cent of new Maxima sales, though are unsure how the split between the two upper models will pan out.

Nissan J32 Maxima 350 Ti ($46,990)

Sitting atop the all-new J32 Maxima shelf is the 350 Ti, and despite the noticeably large price hike over the 350 ST-S, this range topping model adds a profusion of gear to the equation to make it a very worthwhile consideration against similarly priced rivals.

The 350 Ti is, as the nomenclature suggests, powered by the same 3.5-litre V6 engine found in the 350 ST-S and similarly delivers the same 185kW of power and 326Nm of torque and while visually it isn’t vastly different to the mid-spec model below, there are enough indicators availed to differentiate the pair including more elegant 17-inch alloy wheels and more pronounced chrome highlights.

But the real story lies beneath the skin with a feature packed cabin offering buyers an electric tilt-slide sunroof, memory enabled electric front seats, satellite navigation, rear parking camera, Bluetooth mobile phone connectivity and, perhaps best of all, an 11-speaker Bose full Dolby 5.1 channel surround sound audio system on top of the features already found in the 250 ST-L and 350 ST-S combined.

All options are simple to use and understand too and offer excellent fit and finish throughout, a credit to the vehicle’s now Thai sourced production.

The car is also very quiet on all but the most coarse of roads and is comfortable, supportive and generously proportioned. All models within the Maxima range feature a 506 litre boot.

As mentioned with the 350 ST-S model Nissan hopes the two V6 powered models will account for 60 per cent of the Maxima’s sales ratio and go some way to improving the brand’s 6th place ranking among the 180,000 medium and large sedans sold in Australia each year.

The all new Nissan Maxima will be available for sale nationally from June 1.

For our review of the previous generation Nissan Maxima, click here.

Specifications – Maxima 250 ST-L:

Engine: 2496cc DOHC V6 (24 valve)
Power: 134kW @ 6000rpm
Torque: 228Nm @ 4400rpm
Induction: Multi Point
Transmission: Six-Ratio CVT
Driven Wheels: Front
Brakes: Discs with ABS, EBA & EBD
CO2 Emissions: TBC
Fuel Consumption: 9.5 litres per 100km
Fuel Tank Capacity: 70 litres
Fuel Type: 91RON petrol
ANCAP Rating: TBC
Airbags: Front, Side and Curtain
Safety: ESP with Traction Control
Spare Wheel: Full Size Alloy
Cargo Capacity: 506 litres
Tow Capacity: 1200kg (Braked)
Turning Circle: 11.4 metres
Warranty: Three Year/100,000km
Weight: 1516kg (Tare)
Wheels: Alloy 17 x 7.0-inch

Specifications – Maxima 350 ST-S & Ti:

Engine: 3498cc DOHC V6 (24 valve)
Power: 185kW @ 6000rpm
Torque: 326Nm @ 4400rpm
Induction: Multi Point
Transmission: Six-Ratio CVT
Driven Wheels: Front
Brakes: Discs with ABS, EBA & EBD
CO2 Emissions: TBC
Fuel Consumption: 10.2 litres per 100km
Fuel Tank Capacity: 70 litres
Fuel Type: 95RON petrol
ANCAP Rating: TBC
Airbags: Front, Side and Curtain
Safety: ESP with Traction Control
Spare Wheel: Full Size Alloy
Cargo Capacity: 506 litres
Tow Capacity: 1200kg (Braked)
Turning Circle: 11.4 metres
Warranty: Three Year/100,000km
Weight: 1535kg/1563kg (Tare)
Wheels: Alloy 17 x 7.0-inch

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Aussie carmakers “missed” move to small cars – Ford boss

April 21st, 2009 40 Comments

Ford Australia boss, Marin Burela, has said Australian car companies completely missed the boat in making the decision to build smaller cars in this country.

Mr Burela told a briefing of automotive journalists in Melbourne that the Australian companies, including Ford, should be building small cars now, not in a year or two when they plan to commence building them.

The Ford Australia President and CEO, who led the project to develop the latest Ford Fiesta before returning to Australia to take over the top job at Ford, said that had Australia car companies been on the ball they would already be making small or medium sized cars to supplement their large car production.

In a very self-effacing moment Mr Burela described the failure to make the decision as a “travesty” for the local industry.

“I think that one of the biggest travesties and issues that the Australian industry has faced is that in Australia we were not looking far enough into the future, to understand where the consumer and where the market would be heading,” he said.

“All of us should have been producing a small or medium car in Australia today. Yet all of us are only producing large cars in this country.

“It is not a case of fault. I think it is a case of, you make the decisions that you make at the time based on the best source of input and data and intelligence that you can gather,” he added.

Both Ford and GM Holden will move into small car production in the next 18 months, Holden producing an as yet unnamed small car, based on a global Delta platform, at its plant at Elizabeth in South Australia, along side the Holden Commodore large car.

Ford has been planning for almost two years to move production of the next Ford Focus small-car to Australia from South Africa and will build the car at its Geelong and Broadmeadows plants.

Toyota currently makes the essentially medium-size Camry and Aurion in Australia, although in the past it has sought to portray both as large cars.

The Ford boss said that small and medium cars had been a huge success in Europe and he expected to see a major shift in Australian buying patterns over the next five or six years.

At the same time he defended the large car market in Australia, saying that Ford forecasting showed the market in Australia would remain at around 10 per cent through until at least 2020.

“I think you will see an ongoing large-car segment that is around the 100,000 units, and our forecasting right out through to the end of the decade, by that I mean 2020, is that it will continue to be around that 90,000 to 110,000 figure,” he said.

Mr Burela was also very bullish about the future of the Australian car industry saying; “We’re actually forecasting that the industry around the end of the decade will hit the 1.1 to 1.15 million units.”

He also sais that Ford Australia was in “pretty good shape” and was fortunate that it did not have to make any decision about the future of its large car, the Falcon, until the end of next year or into 2011.

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