EoW January 2014

Transatlantic cable

The other states in the pact are Massachusetts, Maryland, Oregon, Connecticut, Rhode Island and Vermont. Taken together, the eight states represent about 23 per cent of the US auto market. Elsewhere in automotive . . . † The US Treasury Department said on 21 st November that it would sell its remaining shares in General Motors by year’s end, allowing the government to sever its last remaining ties to the bailed-out automaker a few months sooner than expected. Meeting the projected timeline would clear the last vestiges of the controversial 2009 rescues of GM and Chrysler. In exchange for providing loans to the two carmakers, the Obama administration took majority stakes in the companies. The lifelines to GM and Chrysler have cost American taxpayers several billion dollars. But administration o cials have long argued that the aim was not to make a pro t: the investments were meant instead to preserve the struggling auto industry, badly wounded by the nancial crisis. Other bailouts that Washington provided during the crisis, including those to the insurance giant American International Group (AIG) and a host of banks, generated pro ts by the time they were concluded. † Ruukki, a Finnish manufacturer of special steels, announced on 19 th November that it had entered the North American market with the opening of a US headquarters in Pittsburgh and a Canadian headquarters in Toronto. Initial o erings will be the company’s two main product lines: high-strength Optim and wear-resistant Raex steels. † Taylor Steel (Stoney Creek, Ontario) has commissioned an $8.5 million advanced high strength (AHS) slitter for cutting the new steels in increasing demand from carmakers. Company founder Michael Taylor told the Hamilton Spectator (19 th September) that he believes the unit to be the rst in North America to surmount breakdown problems associated with slitting steel for auto parts. Taylor Steel USA and Taylor Coil Processing – both in Lordstown, Ohio – are wholly owned subsidiaries of the Canadian company, which also operates a car dealership in nearby Hamilton. † American at-rolled steel buyers were saying in late Autumn that they expected pricing to stay level through year-end; but some, at least, expressed concern that import pressure might put what Platts termed “a psychological ceiling” on prices. One service centre source told the metals information provider that a glut of imports would likely arrive in rst-quarter 2014 if prices remained elevated relative to the world market, creating imbalance. (“US Steel Sheet Prices Still Angled Up, Imports Creating Concern,” 15 th November) While no major domestic mill had formally announced a steel sheet price increase since hikes in early October by Severstal and AK Steel of $20 and $30 per ton, respectively, Platts did note reports that US Steel was quoting higher prices to its customers and Nucor “had refused to budge” from its $680-per-ton list price. One trader commented that, although further price rises would not be a surprise, many major mills were wary of going “too far, too fast,” pushing buyers into the global market. “It just looks better if they move it gradually,” he said. “I think they’re being smart.” Dorothy Fabian – USA Editor Steel

Manufacturing

The political stalemate in Washington that forced a partial federal government shutdown for 16 days in October did not prevent the US manufacturing sector from expanding at its fastest monthly pace in two years, according to one industry report. The Institute for Supply Management (ISP) said on 1 st November that its index of national factory activity rose to 56.4 in October, the best showing since April 2011. A separate report, by the nancial data rm Markit, was less encouraging: its nal Manufacturing Purchasing Managers Index stood at 51.8 for the month, beating the preliminary October reading but coming close to the weakest nal showing since October 2012. Even so, both surveys – which use some di erent methodologies, including one related to seasonal adjustment – indicated expansion in the manufacturing sector, and the ISP gure refuted expectations of a slight slowdown in the growth rate. The October data indicated quickening growth in the goods-producing sector for the fth month in a row. Futuristic no longer, cars that run on hydrogen may be ready for prime time A highlight of the Los Angeles Auto Show in November was not, as might have been expected, a battery-powered or hybrid car but an SUV with an electric motor powered by a stack of hydrogen fuel cells. Set for sale or lease in 2014, the Hyundai Tucson will be the rst mass-market vehicle of its kind to become available in the United States. Hardly a new concept, automotive fuel cell technology has intrigued carmakers since the 1960s; but obstacles such as high cost, safety concerns, and a scarcity of lling stations dampened their enthusiasm. Hyundai now claims to have overcome safety and storage issues with a rear-mounted tank that has passed crash tests. And in California, where the South Korean carmaker plans to start o ering the Tucson, nine lling stations are now open to the plans. State legislators recently allocated about $200 million per year for 100 more, to be built over a decade. While Hyundai is beating others to market with the Tucson, competition – mainly from its Japanese rivals Honda and Toyota – can be expected. Honda Motor Co was also at Los Angeles, showcasing a car which it says pre gures the aerodynamic design of a next-generation fuel-cell vehicle to be launched in 2015. And at the Tokyo Motor Show, also in November, Toyota Motor Corp was scheduled to introduce its own concept fuel-cell car, being readied for distribution in the mass market in 2015. As for General Motors, which has spent considerable time and resources on battery-powered cars such as the Chevrolet Volt, the largest US automaker continues work on fuel cell vehicles but has none in its current new-product pipeline. At Los Angeles on 18 th November, company spokesman Dan Flores told AP that more work needs to be done on cost and infrastructure to make the cars viable. † Hydrogen cars may be arriving in time to help automakers meet newly announced goals for zero-emissions cars. In late October eight key states, including California and New York, pledged to work together to put 3.3 million battery-powered cars, plug-in hybrids, and other clean-burning vehicles on their roads by 2025. This would amount to more than 15 times the number of zero-emissions vehicles projected to be in use in the entire US by 2015. Automotive

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January 2014