Mercedes Benz E-class category winner at Towcar of the Year Awards

28 September 2006

The Mercedes-Benz New Generation E-Class has been presented with a prestigious award by The Caravan Club at its annual Towcar of the Year Awards. The E 320 CDI Estate won the ‘over £33,000’ category in a hotly-contested segment.

Commenting on the award, The Caravan Club explained: “The seven-speed automatic gearbox is a dream – you have to watch the rev-counter to detect when it is changing up and down. But for its huge torque – 540lb ft from only 1600rpm – you would never guess the E 320’s V6 engine was diesel-fuelled, it is so quiet and refined.”

Dermot Kelly, Managing Director Mercedes Car Group added: “We are proud that the New Generation E-Class has won its first major award so soon after its launch. The revised models give even more flexibility, ease of ownership and driving enjoyment than ever before. The E 320 CDI Estate has long been a favourite of our customers, so to have that choice endorsed by The Caravan Club is high praise indeed.”

Launched in July 2006, the New Generation E-Class features some 2000 technical improvements over the outgoing model. Revisions to the steering, suspension, chassis and engine and electronics make the car even better to drive and own than before.

The improvements make life even easier for caravanners. All E-Class Estate models retain the rear Airmatic DC air suspension, designed to keep the car level even when towing a laden caravan, horse box or trailer.

The award-winning E 320 CDI is powered by a sophisticated three-litre V6 third-generation diesel engine. Using the very latest piezo electronic fuel injection system, the CDI engine delivers up to five pulses of carefully-metered fuel in each combustion cycle. These pulses give even greater refinement, more power and enhanced energy efficiency, when compared to a mechanical fuel injection system.

Power is transferred to the rear wheels through Mercedes’ seven-speed automatic transmission system, 7G-TRONIC. Seven speeds mean the engine is often running at lower revolutions than a car equipped with a traditional five-speed ’box – at motorway speeds the rpm is around 20 per cent lower with
7G-TRONIC, giving useful fuel savings.

All of these features combine to give the E 320 CDI 224 hp at 3800 rpm, and an astonishing 540 Nm of torque, available from 1600-2400 rpm. Some 500 Nm is available from just past idling speed, making the flexible ‘grunt’ perfect for towing.

The New Generation E-Class is also fitted with powerful brakes. The Adaptive Brake system automatically dries the disc pads in wet weather, and a hill hold function makes pulling away on an incline very easy.

Safety is paramount in the E-Class, and in addition to Brake Assist, sophisticated airbags and the PRE-SAFE® predictive occupant protection system, the car’s standard ESP® Electronic Stability Program system is further enhanced with Trailer Stability Assist. The ESP® system monitors the car and caravan’s progress along a road, and if ‘fishtailing’ is sensed, the car’s wheels are individually and imperceptibly braked to bring the combination back to a safe and even keel.

An optional (£665) tuckaway towbar can be ordered from the factory, and is operated with a boot-mounted telescopic lever. A safety LED shows when the bar is locked into place. When not needed, the towbar folds away out of sight behind the rear bumper. Luggage that cannot be kept in the caravan can be held in the commodious luggage area of the E-Class Estate – up to 1910 litres are available.

Another new option is the Intelligent Lighting System (ILS). ILS uses bixenon lighting to automatically give five different lighting operations, depending on road conditions and vehicle speed. Country mode gives a broad spread of light, illuminating the road verges; in motorway mode the beam is scaled up, to give a longer, narrower beam designed to show the road ahead at higher speeds.

Revised fog lights reduce beam ‘bounce back’ in low visibility conditions; a cornering light illuminates a turning or driveway when turning at low speed. Finally, the adaptive light system follows the curves of the road, moving the headlights in harmony with the steering wheel inputs. Rather than illuminating a hedgerow or other roadside feature, the lights can improve vision by up to 90 per cent, compared with fixed headlights.

As with every Mercedes-Benz passenger car sold through an official UK retailer, the E-Class range comes with a three year unlimited mileage warranty, backed up by the industry-leading MobiloLife package. Offering protection against corrosion (from the inside out) and breakdown cover for up to 30 years (with a few terms and conditions in place), the E-Class will remain a reliable car for years to come.

The E 320 CDI Estate costs from £38,695 on the road.

Chrysler group sees U.S. market share increase in fourth quarter

Eric Ridenour

Reuters / September 28, 2006 - 12:00 pm PARIS -- The Chrysler group expects to see an increase in its U.S. market share in the fourth quarter, helped by new models, COO Eric Ridenour said today.

"We think with the new products we will see an increase in market share," Ridenour said in an interview on the sidelines of the Paris auto show. "We feel the new products will do well."

The Chrysler group's U.S. sales are off nearly 10 percent so far this year, and its market share has slid about half a percentage point to 12.9 percent.

The Jeep Patriot SUV, Chrysler Sebring sedan and Dodge Nitro SUV are among the new products Chrysler will launch during the fourth quarter. The models are among 10 new cars and trucks it plans to roll out this year.

Facing a glut of unsold trucks and SUVs, the Chrysler group slashed current-quarter production by 24 percent. The company is forecasting a loss of $1.5 billion in the third quarter.

Ridenour said the Chrysler group is taking a hard look at all its costs, including for labor and commodity inputs as it battles a decline in the pickup and SUV segments.

"We are going through a systematic process," he said. "We are going to look at everything. Nothing is off the table."

The COO also said the Chrysler group would try to revive talks with the United Auto Workers to cut its $2.3 billion bill for employee health care costs.

The UAW did not agree to its proposed deal to shift more health care costs to factory workers and retirees, because it said DaimlerChrysler was not facing the same financial pressures as are Ford Motor Co. and General Motors.

"We intend and have to have parity with our major competitors," he said. "That has always been the way of the program. It has to happen, and it has to happen by some sort of means."

Magnitude 6.7 - SAMOA ISLANDS REGION 2006 September 28 06:22:11 UTC Versíon en Español Magnitude - - 6.7 (Strong)
Date-Time	Thursday, September 28, 2006 at 06:22:11 (UTC) = Coordinated Universal Time Wednesday, September 27, 2006 at 7:22:11 PM = local time at epicenter Time of Earthquake in other Time Zones
Location	16.570°S, 172.037°W
Depth	39.2 km (24.4 miles) set by location program
Region	SAMOA ISLANDS REGION
Distances	195 km (120 miles) ESE of Hihifo, Tonga 290 km (180 miles) SSW of PAGO PAGO, American Samoa 610 km (380 miles) NE of NUKU'ALOFA, Tonga 2595 km (1610 miles) NNE of Auckland, New Zealand
Location Uncertainty	horizontal +/- 5.1 km (3.2 miles); depth fixed by location program
Parameters	Nst=243, Nph=243, Dmin=295.8 km, Rmss=0.82 sec, Gp= 22°, M-type=regional moment magnitude (Mw), Version=6
Source	USGS NEIC (WDCS-D)
Event ID	usteaj

• This event has been reviewed by a seismologist.

Chrysler lowers sales outlook for 2006

The Associated Press/PARIS

By MATTHIAS KRUST

SEP. 28 8:28 A.M. ET Chrysler Group, which like its American peers General Motors Corp. and Ford Motor Co., has experienced tough sales in the U.S., said Thursday it is lowering is vehicle sales outlook for the rest of the year.

The group, part of German-American automaker DaimlerChrysler AG, previously expected its 2006 sales figures to remain stable at around 2,826,100 cars from last year. But in the first eight months of this year, sales of its Chrysler, Jeep and Dodge brands have dropped by 10 percent to just less than 1.5 million cars.

"On the whole year, we believe that the decline will be less than 10 percent with stabilizing sales in the remainder of 2006," Joe Eberhardt, Chrysler's head of sales and marketing, told Dow Jones Newswires at the Paris Auto Show.

He said that sales are expected to pick up with the rollout of eight new models that boast lower fuel consumption, noting that consumers are looking for cars with better mileage in light of higher gas prices.

Eberhardt said he expected 2007 sales to be above the final tally of 2006's results.

DaimlerChrysler recently disclosed that Chrysler would have a loss of nearly euro1 billion ($1.27 billion) instead of an expected profit, and issued a profit warning.

That, in turned, caused DaimlerChrysler to reduce its profit outlook to euro5 billion ($6.3 billion) from euro6 billion ($7.6 billion).

But Eberhardt said that Chrysler was set to break even by the fourth quarter.

"There will be no further cuts in production," he said, adding that Chrysler's pervious capacity utilization -- a number that shows the extent to which fixed costs are covered -- had been at a competitive 95 percent. "Our capacity utilization will increase significantly in the year to come."

Shares of DaimlerChrysler fell more than half a percent to euro39.64 ($50.28) in Frankfurt trading.

Doctor Z Expects Mercedes Sales to rise above 2005 Expectation

PARIS (AFX) - DaimlerChrysler AG chief executive Dieter Zetsche told journalists at the Paris Car Show that full-year unit sales at the Mercedes Car Group are expected to exceed last year's total.

'Both efficiency and quality have improved in equal measure, as our customers are acknowledging,' Zetsche said in a statement.

'From January to August 2006 our worldwide unit sales increased by around eleven percent compared to the same period last year.'

2006-09-28 01:36 (Mw 6.0) KURIL ISLANDS 46.6 153.3

== PRELIMINARY EARTHQUAKE REPORT ==

Region: KURIL ISLANDS
Geographic coordinates: 46.587N, 153.308E
Magnitude: 6.0 Mw
Depth: 21 km
Universal Time (UTC): 28 Sep 2006 01:36:50
Time near the Epicenter: 28 Sep 2006 13:36:50
Local time in your area: 28 Sep 2006 02:36:50

Location with respect to nearby cities:
446 km (277 miles) ENE (68 degrees) of Kuril'sk, Kuril Islands
805 km (500 miles) E (89 degrees) of Yuzhno-Sakhalinsk, Russia
1658 km (1030 miles) NE (39 degrees) of TOKYO, Japan

ADDITIONAL EARTHQUAKE PARAMETERS
________________________________
event ID : US teac

This event has been reviewed by a seismologist at NEIC For subsequent updates, maps, and technical information, see:
http://earthquake.usgs.gov/eqcenter/recenteqsww/Quakes/usteac.php

Oil retreats as gasoline supplies surge

Crude also declines less than expected; prices slide

September 27 2006: 10:40 AM EDT | NEW YORK (CNNMoney.com) -- Oil prices erased most of their gains Wednesday after the government said supplies of crude oil fell far less than expected while gasoline stocks surged.

U.S. light crude for October delivery was up 10 cents to $61.11 a barrel on the New York Mercantile Exchange, having turned lower briefly after the report's release. Oil traded up 60 cents just prior to the report's release.

In its weekly inventory report, the Energy Information Administration said crude stocks slipped by 100,000 barrels last week. Analysts were looking for a decline of 1.7 million barrels, according to Reuters.

Gasoline supplies swelled by 6.3 million barrels, while distillates, used to make heating oil and diesel fuel, rose by 2.3 million barrels. Analysts were looking for a 500,000 barrel increase in gasoline supplies and a 2.3 million barrel build in distillates.

CNN|MONEY REPORT - - BREAKING NEWS

CNN|MONEY REPORT - - BREAKING NEWS

Oil prices erase gains on surprisingly strong inventory report. Details soon.

Expecting a 57-59.00 Dollars per barrel after this hits the world's news wire.

Another Insider Sneak Peek - 2008 Jeep Liberty

DETROIT NEWS - - Chrysler engineers have been testing prototypes of the next-generation Jeep Liberty, which is slated to roll into dealerships about a year from now as a 2008 model.

The redesigned Liberty gets all-new sheet metal, larger glass surfaces and a redesigned cabin. It will also be a bit larger and wider than the current model, and will share underbody pieces with the 2007 Dodge Nitro.

The '08 Liberty will retain its rugged looks and classic Jeep styling, as well as its exceptional off-road capability. It will be slotted in size and price above the two new car-based Jeeps, the Compass and the Patriot, when it arrives in showrooms in fall 2007.

Paul Lienert

DaimlerChrysler considers U.S. city for new plant

The Associated Press |

KOKOMO, Indiana DaimlerChrysler says it is considering a U.S. city where it already has two large manufacturing complexes for a new$560 million (€441 million) transmission plant. The new plant in Kokomo would be part of a joint venture with Getrag Corporate Group of Germany for a new line of wet dual clutch transmissions, Chrysler spokesman Dave Elshoff told the Kokomo Tribune for a story Wednesday. "We are developing a business plan for a new transmission product," Elshoff said. "That business plan will require a number of things. It will require the approval of DaimlerChrysler's board of management, state incentives and a local UAW agreement." Elshoff said the company had reached an agreement with the United Auto Workers to move forward with the project. Guy Barger, president of UAW Local 685, which represents workers at the company's Indiana Transmission Plant in Kokomo, said he would not comment on the agreement. "Chrysler will make announcements about its products," he said. "As far as I know, Chrysler hasn't made any announcement." The memorandum of understanding between DaimlerChrysler and the UAW obtained by the Tribune says companies would invest $560 million (€441 million) in a new plant, preferably near Indiana Transmission Plants I and II, along U.S. 31 on the city's north side. That spending would include tooling, machining and equipment, with the plant opening in 2009. Chrysler owns about 280 acres (112 hectares) of land near the Indiana Transmission Plants, which have about 2,600 workers and have opened since 1998. About 4,200 people work at the company's Kokomo transmission and casting plants in the city some 40 miles north of Indianapolis. The memorandum says that Chrysler "is moving forward with Getrag to procure land, apply for permits, and finalizing government incentives." Jason Hester, the city's development director, said the project would be welcome news. "It would mean new tax revenues and jobs for the community," he said. "Anytime there is a new investment being made in community, it makes us happy." KOKOMO, Indiana DaimlerChrysler says it is considering a U.S. city where it already has two large manufacturing complexes for a new$560 million (€441 million) transmission plant. The new plant in Kokomo would be part of a joint venture with Getrag Corporate Group of Germany for a new line of wet dual clutch transmissions, Chrysler spokesman Dave Elshoff told the Kokomo Tribune for a story Wednesday. "We are developing a business plan for a new transmission product," Elshoff said. "That business plan will require a number of things. It will require the approval of DaimlerChrysler's board of management, state incentives and a local UAW agreement." Elshoff said the company had reached an agreement with the United Auto Workers to move forward with the project. Guy Barger, president of UAW Local 685, which represents workers at the company's Indiana Transmission Plant in Kokomo, said he would not comment on the agreement. "Chrysler will make announcements about its products," he said. "As far as I know, Chrysler hasn't made any announcement." The memorandum of understanding between DaimlerChrysler and the UAW obtained by the Tribune says companies would invest $560 million (€441 million) in a new plant, preferably near Indiana Transmission Plants I and II, along U.S. 31 on the city's north side. That spending would include tooling, machining and equipment, with the plant opening in 2009. Chrysler owns about 280 acres (112 hectares) of land near the Indiana Transmission Plants, which have about 2,600 workers and have opened since 1998. About 4,200 people work at the company's Kokomo transmission and casting plants in the city some 40 miles north of Indianapolis. The memorandum says that Chrysler "is moving forward with Getrag to procure land, apply for permits, and finalizing government incentives." Jason Hester, the city's development director, said the project would be welcome news. "It would mean new tax revenues and jobs for the community," he said. "Anytime there is a new investment being made in community, it makes us happy."

This Day in Auto History: 27 SEPTEMBER

9.27.1899 - Albert Jesse Browning of Ford is born in Ogden, UT

9.27.1913 - The Wagenhals Motor Car Company reorganizes with William Pflum as President, W. G. Wagenhals
as Vice President and Treasurer, and Hughes C. Turner as Secretary

9.27.1942 - Louis Schneider, winner of the 1931 Indianapolis 500, dies at age 43

9.27.1957 - Racer Pierre Petit is born in France

9.27.1972 - Mack Trucks, Inc. contributes $1 million to establish the American Truck Museum and Library in Allentown, PA

2007 Mercedes C-class... and a brave prediction

AUTO-FUTURE - - Photos of barely disguised C-class Mercedes are very common these days, just check one of the latest below. A lot was written about this important car here at auto-future (check it here or here). While we wait for official images (and these could arrive shortly after Paris show) we noticed a very brave prediction of future sales of the new C-class vs the next Audi A4, presented by Auto Motor und Sport magazine. Wow, what a strong Mercedes supremacy, does AMS has some very special inside information on these?... Some questions were asked concerning this, and the experts opinion was: "Europe's economy is finally on a steady climb again". So what!? Well, more money will be available and this translates to a simple conclusion: for those that can afford the Mercedes or BMW, the Audi model simply does not exist...

.

DIESEL MOTOR MORE EFFICIENT THAN HYBRIDS?

FreeMarketNews.com - - Engineers at Honda have developed a new diesel motor that is considered more cost-effective and efficient than hybrid motors, according to Reuters. The motor is so efficient that it could be used to replace gasoline driven cars. The new diesel motors could be sold in cars by 2009.

Diesel engines get 30 percent better gas mileage than gasoline engines, but normally they release high levels of exhaust. However, Honda’s motor system uses a two-layer catalytic converter to split nitrogen oxide into nitrogen using ammonia. The motor is simple, making it cost effective. Daimler Chrysler had developed a similar system using ammonia that is set to launch in 2008. However, it is much more complex and expensive.

In order to launch the sale of the motors in the U.S., Honda must first develop a way to measure emission levels and prove that it passes American standards. Honda may not be the only company to use the technology. Company officials have already said that they would consider licensing it to other auto manufactures.

Chrysler announces incentives on '07 models

FREEP | AUBURN HILLS MI - - Chrysler Group told dealers of new incentives for several of its large 2007 vehicles Friday, to the chagrin of those who complain it makes it that much harder for them to sell remaining 2006 pickups and SUVs that have been sitting on sales lots for months.

Chrysler expanded its incentive program to include lease rebates through Saturday of from $500 to $2,500 on 2007 minivans, Dodge Ram, Dodge Dakota, Jeep Commander, Jeep Grand Cherokee (excluding the SRT8) and the six-passenger Pacifica.

The automaker also announced lease pull-ahead offers on select 2007 models and $500 Chrysler Financial bonus cash on select 2007 models.

Belvidere plant assembles popular vehicles - 92,000 Orders Behind

Belvidere IL - - Workers in Belvidere put together the Dodge Caliber and Jeep Compass, the company’s offerings in the small-car and small-SUV markets.

The sales of the two products, both launched this year, have been so strong they have outpaced the plant’s ability to produce them.

As of Sept. 1, the company was more than 67,000 behind on Caliber orders and 25,000 on Compass orders.

For more information about either vehicle or the Chrysler Corp. production plans, go online to www.chrysler.com

Chrysler close to small-car partnership

LaSorda

Automaker could partner with Chinese firm to manufacture subcompact model.

Josee Valcourt / The Detroit News | DETROIT -- Chrysler Group CEO Tom LaSorda said Monday it could strike a partnership with an overseas manufacturer to build a subcompact car for the United States by year end and China has not been ruled out as an export hub.

LaSorda also reiterated that Chrysler is considering restructuring actions after revealing last week that it will lose $1.5 billion in the third quarter.

Offering a subcompact to American consumers would help beef up Chrysler's car lineup and give it a presence in a market segment where foreign rivals Toyota, Honda and Nissan are reaping benefits as more consumers opt for fuel efficiency.

Chrysler's parent company, DaimlerChrysler AG, is in talks with China's Chery Automobile Co. Ltd. to build a subcompact for the North American market, people familiar with the discussions told The Detroit News.

The deal would be a watershed event for the U.S. auto industry. No mass market Chinese-made car has ever been sold in the United States.

The vehicle would likely be sold under the Dodge nameplate in the United States and other markets, including Europe and Latin America. The automaker has shown a concept subcompact car called the Dodge Hornet.

Chrysler said it would be cheaper to produce the vehicle overseas and has had talks with Hyundai, Volkswagen and Mitsubishi Motor Co. in pursuit of a partnership.

"The only way the Chrysler Group can make a business case for a low-margin subcompact is through a partnership, which allows us to reduce capital investment, bring product to market faster, and meet low cost and high-quality targets," LaSorda said at an Automotive Press Association breakfast event at the Detroit Athletic Club.

LaSorda would not comment on reports of an impending deal with Chery but said an agreement with a Chinese manufacturer "has not been ruled out."

Fewer than 300,000 subcompact vehicles will be sold in the United States this year, accounting for about 2 percent of the overall car and truck market, said Jeff Schuster, an automotive forecasting analyst for J.D. Power and Associates. But demand for subcompacts will continue to grow, experts predict. By 2010, the market will grow to 400,000 vehicles, he predicts.

"It's still a small number," Schuster said. "But the first-time car buyers are looking at this segment so the idea behind it isn't only incremental volume for market share but to build loyal buyers. When they're ready to shift into something larger, the hope is that you keep them in your brand."

Aside from General Motors Corp.'s tiny South Korea-built Chevy Aveo, the subcompact class is ruled by Asian automakers with vehicles such as the Toyota Yaris, Honda Fit and Nissan Versa -- all made overseas and sold in the United States

In addition, the large Generation Y demographic is approaching driving age and will account for a substantial number of first-time car buyers.

"This is an important segment to attract more younger and entry-level buyers," LaSorda said.

The Chrysler Group's smallest car is the Dodge Caliber hatchback, which has sold well since its debut in February.

Light trucks still account for 71 percent of its sales for Chrysler, Dodge and Jeep, meaning the automaker was vulnerable as demand swung sharply toward smaller vehicles this year.

2008 Jeep Liberty borrows Dodge styling

KGP Photography | Date posted: 09-25-2006

The ace shooters at KGP Photography are some of the best in the business when it comes to capturing the sharpest spy photos of the newest prototypes. This time around they went one step further and provided a detailed account of what they saw when a 2008 Jeep Liberty prototype crossed their path. Rather than filtering through their notes, we decided to give you the details straight from the source.

At first glance we thought this was an old 2007 Dodge Nitro prototype with some leftover camouflage, but an obvious Jeep-style grille got our attention. We quickly realized that this prototype was the new 2008 Jeep Liberty, and it is far more than a Nitro with a Jeepish front fascia tacked on. The Dodge Nitro is based on a heavily modified platform of the current Jeep Liberty, resulting in a 4-inch-longer wheelbase, but the larger dimensions are combined with a lower roof (chopped by 1 inch), giving the Nitro a squat roofline and relatively narrow window openings.

After analyzing our shots of this Jeep tester, we're convinced that the Liberty uses this same platform, but it appears to be a few inches taller than its Dodge brother, probably an attempt to maintain some utility, not to mention a resemblance to the Jeep Commander.

The Liberty's revised packaging results in a larger windshield and redesigned roof pillars, which means that the Jeep shares few, if any, body panels with the Dodge. The Jeep face is clearly visible through the camo. Its seven-slat vertical grille is flanked by new headlight clusters with some circular internal detailing to maintain familiar Jeep cues, and turn indicators that wrap into the flared front fenders (a trait shared with the current Liberty).

Some version of the Nitro's side fender vents seems to be in play on the new Liberty, but with a different design treatment. Although the Jeep's door panels are cleanly styled, they have a bit more surface development than the smooth-skinned Nitro, giving the Liberty a slightly chunkier look. The Jeep also has a different roof rack setup.

On to the rear, the Liberty gets revamped taillight lenses and a reworked rear bumper, but that's not all. The Liberty's taller rear window is hinged and has a grab handle, meaning that the rear glass can be raised independently from the rear hatch. The Nitro's rear access is strictly through the raised tailgate, giving an edge to the Jeep in terms of functionality.

Although we couldn't crawl under this prototype for an up-close inspection, it appears that the Liberty will utilize the same independent front suspension and five-link rear suspension found on the Nitro, but perhaps some changes are possible if Jeep engineers feel the need for some more trail-cred. Expect to see the same 3.7-liter V6 under the hood as well. We'll have to catch one parked to figure that out for sure.

Give Jeep designers credit for not taking the easy way out and offering a Jeep-grilled Dodge Nitro. The changes visible on this prototype point to an effort to remain true to Jeep's core values — utility and functionality over pure, street-inspired design. With the arrival of two sub-Liberty Jeep models — the Dodge Caliber-based Patriot and Compass — the next Liberty had to do some growing up. And it looks like it has. The 2008 Jeep Liberty promises to be a more substantial vehicle that will move it away from the entry-level role it has played in the past.

Smart Fortwo (Not) to Be Unveiled in Paris

JALOPNICK AUTONEWS | PARIS - - Good thing we didn't include the Smart Fortwo in our latest reader poll of what we should cover in Paris. Turns out, the company's not unwrapping the new little 'un in the city of lights. Buried in the lower third of a press release from DaimlerChrysler today came word the redesigned Fortwo -- the one that's coming to the US -- "is not on show in Paris," and that, "The world premiere will take place this year, at a location outside of the trade fair circuit." Outside the trade fair circuit? Do these guys think we're made of frequent flyer miles? Read the entire release after the jump.

Press Release:

The city loves you

Comfort, agility, safety and ecology are particular strengths of the smart fortwo. They are best demonstrated in European cities such as Paris, Berlin or Rome - the environment that this car was developed for and where it has achieved cult status in a very short space of time.

The smart fortwo requires only half the road space of most other vehicles. The agile two-seater not only gets you around town more quickly; if everyone were to drive a smart fortwo, the line of cars waiting at the traffic lights would be only half as long, and the car parks would have space for twice as many cars. Or to put it another way: you don't have to look for a parking space in the smart fortwo - you find one.
A car park at the fair stand

But let's come back to comfort, agility, safety and ecology: under the motto "The city loves you" the smart fortwo will be demonstrating these - its archetypal strengths - at the Paris Motor Show. A car park is a main feature of the exhibition area. Here, 15 smart fortwos are parked close together. They demonstrate the economical use of valuable parking space by this two seater measuring less than three metres in length.

Incidentally, all the smart fortwos sport the same appearance in lite white with a silver tridion safety cell. With one exception: the smart fortwo edition red has an all-over "intensive red" finish. This sporty two-seater is to be offered as the final special model as the current series is phased out, and is also on show at the fair in Paris.
The new smart fortwo: Even more smart fortwo

The new smart fortwo, which will be launched in the spring of 2007, is not on show in Paris. The world premiere will take place this year, at a location outside of the trade fair circuit. However, a first indication of its appearance has already been given: a sand sculpture of the new model could be seen during the German beach volleyball championships at the beginning of September at Timmendorfer Strand.

Over and above this we can reveal this much: the new smart fortwo will be a true smart fortwo as well. It will adopt the key characteristics of the current model. You could say that the fortwo can do everything that the current fortwo can do - but a little better.

The smart press conference will take place on the first press day (28 September 2006 from 12:15 to 12:30). In addition, journalists are warmly invited to start the first and second press days from 8:30 to 10:30 with a smart breakfast.

In the evening of the first press day (28 September 2006) automotive journalists will have an opportunity to watch the film "A Good Year" before it is shown at cinemas in November. In a screening that is not open to the public smart will show the film starring Oscar prize-winner Russell Crowe (who drives a smart fortwo in the film) in the English original. "A Good Year" is the fourth international cinema film featuring smart product placement. Journalists will assemble at 18.30 and the film will be screened at 19.30.

This Day in Auto History: 26 SEPTEMBER

9.26.1910 - William C. Durant loses control of General Motors

9.26.1930 - Philippe Etancelin, driving a Bugatti Type 35C, wins the French Grand Prix at Pau

9.26.1949 - Robert A. Weinhardt, a design engineer with Ford, Packard, Kaiser-Frazer, and Willys who had helped design the first demountable disc wheels and shock absorbers, dies at age 66

9.26.1955 - Yrjo “George” Leiviska, an employee of Buick, Cadillac, and GMC in the 1930’s prior to a government service career in his native Finland, dies

9.26.1962 - The 1963 Chryslers are introduced

Mercedes-Benz to sell diesel-powered SUVs in US in 2008

DOW JONES NEWSWIRES - - DaimlerChrysler AG's (DCX) Mercedes-Benz unit will sell diesel-powered versions of its M- R- and GL-Class sport-utility vehicles, beginning in 2008.

Mercedes-Benz said its Bluetec technology cuts nitrogen oxide emissions by adding a urea-based solution into the exhaust stream.

The new models will be the first diesel-powered vehicles to meet the Environmental Protection Agency's BIN5 emissions standards for all 50 states, the company said.

Dodge Avenger concept and new Jeep Wrangler at Paris

EASIER | PARIS - - Chrysler Group will unveil the all-new Jeep Wrangler at the Paris Motor Show this week, and reveal a concept car that hints at a brand new Dodge saloon car that will be on sale in the UK by the middle of next year. The production version of the two-door Jeep Wrangler and four-door Jeep Wrangler Unlimited are being shown in Europe for the first time, and will be in dealers in the UK by April next year. Peter Lambert, Managing Director of Chrysler Group UK, said: “This new Wrangler offers drivers the ‘rugged’ Jeep look and feel without letting its extreme off-road ability compromise on-road dynamics. The new model is a significant step forward from the old vehicle, as it offers a diesel engine for the first time, a choice of short and long-wheelbase, much better road manners, reduced noise levels, a host of safety features, a convertible hard top and an all-new interior with space for five adults and their luggage. “We expect the new Jeep Wrangler to attract attention from families that currently buy the Land Rover Defender. We will offer impressive value for money and fuel economy plus a diesel auto option and convertible hard roof not available on the competition.” While 99 per cent of Wrangler and Wrangler Unlimited sold in the UK in 2007 will be powered by a new 2.8-litre diesel engine, a handful of Jeep ‘Wrangler Rubicon’ models will be sold with a new 3.8-litre petrol engine and a host of additional off-road features that will make this the best off-road Wrangler ever. Dodge is also looking to break new ground with the all-new Dodge Avenger concept – a bold styling statement that does away with the idea that a functional family car is automatically boring. The Avenger concept will appeal to car buyers around the world who need the practicality, functionality and fuel efficiency of a mid-size saloon, but want more, including a vehicle that stands out and makes a statement. Avenger’s bold muscle car styling, innovative features and solid performance will allow them to do just that. Peter Lambert added: “While the Avenger concept only hints at the latest vehicle from Dodge, it will do what Caliber has done for the family hatchback and what Nitro promises to do in the 4x4 segment – it offers a unique alternative to the competition. The Dodge Caliber has been a big success with the car-buying public so we are expecting great things from our two new Dodge vehicles next year.” From the front, large quad headlamps surrounded by black housings create the distinctive glare that forms Avenger’s face and surround the signature Dodge crosshair grille. Avenger’s side profile is distinguished by a long bonnet, short deck lid proportions with muscular rear shoulders and sleek rear spoiler. This concept’s long glasshouse is created by the use of a high-gloss black B-pillar and aerodynamic inspired rear door appliqués, which make this mid-size saloon look like it’s pouncing forward, even when it’s at a standstill. Deep side sills, nineteen-inch five-spoke painted satin silver wheels and deep red brake callipers add to the Avenger concept’s sporty look. Chrome-tipped dual exhaust outlets communicate the performance capability of the Avenger concept’s 2.0-litre turbo diesel engine.

Chrysler cuts hit home - 2,300 workers will be off for the next 2 weeks

JOHN DEMPSEY | Tribune business writer - - The repercussions of DaimlerChrysler’s decision this week to cut deliveries to dealers by 90,000 for the third quarter are already starting to hit Kokomo.

Approximately 2,300 hourly and salaried employees of Chrysler Group’s Indiana Transmission Plant I and II will be off work for the next two weeks when the company shuts the plants down, according to Michelle Tinson, a Chrysler spokeswoman.

ITP I makes rear-wheel drive transmissions for Dodge Ram trucks and Jeeps while ITP II builds transmissions for large cars — such as the Chrysler 300 and Magnum and Dodge Charger — and Jeep vehicles.

Guy Barger, president of United Auto Workers Local 685, which represents hourly employees, was expecting Kokomo to be impacted by the cutbacks.

“We’ve experienced previous shutdowns at ITP I. I’m surprised about ITP II. It’s never been taken down for weeks there,” he said. “The products that that transmission [plant] supplies have been a big seller. Now, we’re seeing some downturn there, too.”

Kokomo Transmission Plant, which makes front- and rear-while drive transmissions as well as the heavy duty 48RE, will maintain its production schedule, according to both Tinson and Barger.

A bloated inventory resulted in DaimlerChrysler’s decision to scale back operations for the rest of the year. It plans to cut shipments in the second half of 2006 by 135,000 units.

Production of Dodge Durangos and Ram trucks are the primary sources for the 90,000 vehicle cutbacks, Chrysler has said. Tinson added that production cuts could be offset by new vehicle launches.

When the cuts were announced Tuesday, questions about Kokomo operations were left unanswered by the company.

Chrysler’s statement said “at this time, we are not able to quantify or evaluate how that will affect plant by plant sites. Naturally, reduction in components would occur and that includes engines and transmissions.”

Sources within the operations on the city’s north side said management informed salaried employees of the shutdown Wednesday.

The same sources also say that both plants could be shut down the week of Oct. 23 and ITP I may possibly be closed for two weeks at the beginning of December.

When asked about those possibilities, Tinson said that company policy only allowed her to discuss production plans for the next two weeks as changes in sales could change future plans.

Chrysler fits plant for new Sebring

Clarence Tabb Jr. / The Detroit News

Nikita Lee installs a front seat at Chrysler's Sterling Heights plant, which joins an Illinois facility as the company's standard for manufacturing.

Updated Sterling Heights assembly showcases flexible manufacturing.

Josee Valcourt / The Detroit News

STERLING HEIGHTS -- Chrysler Group on Thursday showed off its makeover of the Sterling Heights assembly plant, home to the redesigned 2007 Sebring midsize sedan.

With a $500 million investment in the factory and nearby stamping plant, the facility joins Chrysler Group's Belvidere, Ill., as the gold standard for the automaker's flexible manufacturing system.

The Sterling Heights plant can produce up to three small and midsize models on a single line, said Fred Goedtel at an event Thursday to showcase the updated plant. Goedtel is vice president of Chrysler assembly plants, where small, family and premium vehicles such as the Chrysler 300C and Town & Country minivan are built.

If needed, the Dodge Caliber, now built at the Belvidere plant, could be added to the Sterling Height's line, Goedtel said.

Among 13 Chrysler factories in North America that have installed some level of flexibility, Sterling Heights and Belvidere are the top of the heap.

Typically, flexible factory lines include teams where workers can perform more than one job and include a number of automated procedures.

At the Sterling Heights plant, Chrysler has 784 robots working along the line to weld frames and move pieces.

Bill Parker, president of United Auto Workers Local 1700, called the Sebring launch good news.

"It's really what we want: More jobs and to keep the jobs here," Parker said.

Local 1700, along with Locals 889 and 412, represent 2,609 workers at the factory and an additional 2,500 at the Sterling Heights stamping plant.

Sterling Heights currently is operating one shift to build the Sebring, but will add another when assembly begins on the convertible, which comes out next year.

The hard-top Sebring, priced at $18,995, will arrive in showrooms in November. J.D. Powers and Associates projects Chrysler will annually sell up to 90,000 of the vehicle, which underwent a complete redesign.

You can reach Josee

Chrysler CEO sees international sales increasing

DETROIT, Sept 25 (Reuters) -Chrysler Group Chief Executive Tom LaSorda said on Monday that international sales of its cars and trucks will account for 9 percent of the company's overall sales in 2007.

LaSorda, speaking to the Automotive Press Association in Detroit, said the sales target compares to about 6 percent in 2000.

International sales for the Chrysler Group, the U.S. arm of DaimlerChrysler AG (DCXGn.DE: Quote, Profile, Research) were up 14 percent in the first eight months of this year, he said.

Some of those gains have come from the popular new hatchback Dodge Caliber, LaSorda said. Chrysler sold 7,000 Calibers outside the United States in the first three months of this year.

Car thieves' most wanted [Chrysler vehicles]

Brandy Baker / The Detroit News

Bennie Taylor Jr. checks out his stolen 2004 Dodge Ram truck at Jim's Collision Shop in Detroit, where it is being held until $13,000 in repairs can be completed. The truck, stolen on May 11, was recovered six weeks later, minus its 20-inch wheels and tires.

Car thieves' most wanted

Rash of thefts prompts warning from Metro cops

Doug Guthrie / The Detroit News - -DaimlerChrysler's domestic vehicles are hot in Michigan, but not always in a good way.

Police say the popularity of the cars, and design vulnerabilities the automaker is improving, has them jamming police lists of stolen vehicles. Despite years of pressure by the insurance industry, Chrysler's steering columns remain easy to break and feature ignition systems that can be started without correct keys.

In recent weeks, a rash of thefts has prompted police even in notoriously safe places like Grosse Pointe Shores to warn residents to tuck Dodges and Jeeps into garages or block them into driveways.

In 2005, Chryslers accounted for six of the top 10 most frequently stolen vehicles in Michigan, with 2005 and 2004 Dodge Rams leading the list. Nationally, Hondas and Toyotas lead the way, but Chrysler has occupied at least five of the top 10 spots in Michigan in each of the past four years.

"Thieves steal what they know, and right now, they know a lot of Chrysler products are easy to take," said Terri Miller, director of an insurance industry-funded cooperative called Help Eliminate Auto Theft (HEAT).

The problems come because ignitions that start Chrysler's most popular pickups and SUVs only when correct keys are used are $200 options. Ford Motor Co. and General Motors Corp. include electronic ignition immobilizers as standard features on all but their commercial fleet vehicles.

Chrysler officials said they're working on fixes. In the past two years, the company boosted to 87 percent from 55 percent the number of vehicles it sells with standard immobilizing systems.

"Not all our customers want to pay for it. In rural and suburban America, (car theft is) not the same issue," said DaimlerChrysler spokesman Cole Quinnell. "It is standard on most of our vehicles, but some base models make it optional."

Canadian authorities recognized the problem two years ago, requiring all manufacturers to make immobilizing anti-theft devices standard on all vehicles sold there by next September.

Miller said the police and insurers have lobbied with Chrysler for years. The automaker's vehicles are disproportionately stolen in Michigan -- accounting for 36 percent of car thefts in 2005, compared to 22.5 percent of new car sales, industry statistics show.

"This situation won't change until Chrysler's customers demand more and better theft-deterrent devices," Miller said.

And the bad guys know it.

Bennie Taylor Jr., 52, a retired DaimlerChrysler factory worker, had his 2004 Dodge Ram stolen from behind his Detroit home on May 11, the same night thieves swiped his neighbor's Ram.

Taylor didn't bother to pay for Chrysler's optional anti-theft system when he signed the best employee bargain lease he could find.

The truck was recovered six weeks later in Dearborn, battered and missing its popular optional 20-inch wheels and tires. The vehicle remains in the shop, awaiting $13,000 in repairs.

"Chrysler needs to do something about this," Taylor said. "I like that truck, but I'm not sure what I'm going to do to keep someone from taking it again."

About 50,000 cars a year are reported stolen in Michigan, fifth highest in the nation. Claims cost insurance companies in the state $476 million in 2003, according to Peter Kuhnmuench executive director of the Insurance Institute of Michigan. The vast majority occurred in Wayne County, with 31,000 in 2004, the most recent year of available statistics.

Of those, most -- 24,573 -- were in Detroit. Oakland County had 3,419; Macomb County, 3,349.

"We have a real love for the American automobile here in Michigan, whether your motives are legit or otherwise," Kuhnmuench said. "Our history here in Michigan is the American-made muscle car, and Chrysler is hot in our market using that image. That generates a black market demand for the same thing."

Grosse Pointe Shores Public Safety Director Stephen Poloni issued a warning after thieves tried twice in the past few weeks to steal Dodge Durangos -- a high number for a community dotted with cul-de-sacs that prohibit quick escapes.

Both trucks had the optional anti-theft devices that shut off engines before they could be driven away, but not before thieves broke windows and wrecked steering columns.

State Police Detective Lt. Ed Gerds, head of the Western Wayne County Auto Theft Task Force, said thieves are so confident they have tried bold moves.

"The Chrysler plants even get hit, the employee lots," Gerds said. "They are offering great deals so the market is flooded with them and the parts are easy to sell."

See full image

In Sterling Heights, a gang of well-organized thieves this month swiped more than $700,000 worth of new Chrysler vehicles from a private lot. But Macomb Auto Theft Squad Detective Lt. John Michalke said it probably was an inside job because the keys were left inside the vehicles.

Four 20-inch wheels and tires from a Dodge Ram pickup can fetch $600 on Metro Detroit streets, Gerds said. The same set costs $3,600 from dealerships.

"Without a doubt, we get more Chrysler products here then anything else. It's tires and wheels. That's what they want," said Paul Ott, owner of Gene's Towing, which runs a major impound yard on Dix in Detroit.

One weekend this month, the tow yard's tally of stolen cars included one Cadillac, a Ford Taurus and Topaz -- and at least nine Dodges and Chryslers.

"The bad guys are lazy," Michalke said. "They won't take a car that is hard to steal. You don't see many Chevys or Fords stolen because they have good anti-theft devices.

"I think Chrysler has made strides, but there is a ways to go."

DaimlerChrysler to issue $2.02 bln auto ABS

NEW YORK, Sept 25 (Reuters) - DaimlerChrysler (DCXGn.DE: Quote, Profile, Research) is slated to issue $2.02 billion of asset-backed securities supported by auto loans, a source familiar with the deal said on Monday.

Banc of America Securities, Barclays Capital and JP Morgan Securities are the deal's lead underwriters, the source said.

The following are terms and conditions for "DCAT 06-C": CL AMT(MLNS) (MDY/S&P) WAL WIN Bmrk/Px Guidance

Daimler might sell Chery cars in Europe

Geoff Dyer in Shanghai | CHINA - - DaimlerChrysler is in talks with Chery about selling small cars made by the ambitious Chinese manufacturer in Europe and the US, according to insiders at both companies.

The two carmakers are discussing making small vehicles under the Dodge brand for sale in the developed world, said one Chery executive involved in the talks.

The negotiations are part of DaimlerChrysler's efforts to build a low-cost manufacturing base for small cars after deciding that it was not economically viable to do so in the US. They are also likely to add to concerns in the US car industry about competition from China.

For Chery, one of a group of Chinese car companies that are preparing an export drive, any eventual deal would give it access to the marketing and distribution expertise in the developed world that it lacks. The official would not say how close the two were to reaching agreement.

This month, Dieter Zetsche, DaimlerChrysler chairman, said the company was in talks with a number of carmakers in Asia about exporting sub-compact cars to North America.

Last year, a DaimlerChrysler board member said at a car show in Shanghai that the company was considering setting up a joint venture with a Chinese manufacturer to export cars back to the US. However, after coming under criticism from trade unions in the US, the company later played down the idea.

Brilliance Auto, the Chinese partner of Germany's BMW, said yesterday it had secured a dealer to export 3,000 Zhonghua sedans to Europe for the first time.

The only carmaking multinational to begin exporting cars to developed countries from China is Honda, which started shipping the Jazz hatchback to Europe last year.

Chery announced last year plans to begin selling a range of cars in the US and Europe from 2007 and signed a deal with Visionary Vehicles, whose founder, Malcolm Bricklin, was responsible for bringing the Yugo to the US.

However, the company has had difficulty securing dealers in Europe and this month Mr Bricklin admitted that Chery might have to wait until 2009 to begin exporting to the US.

Other Chinese companies looking to export to Europe and the US include Geely, Jiangling, Lifan and Shanghai Auto.

Additional reporting by James Mackintosh in London

ΠΗΓΗ: FT.com

2006-09-25 22:03 (Mb 5.5) KYUSHU, JAPAN 33.5 131.6

== PRELIMINARY EARTHQUAKE REPORT ==

Region: KYUSHU, JAPAN
Geographic coordinates: 33.479N, 131.582E
Magnitude: 5.5 Mb
Depth: 71 km
Universal Time (UTC): 25 Sep 2006 22:03:48
Time near the Epicenter: 26 Sep 2006 07:03:48
Local time in your area: 25 Sep 2006 23:03:48

Location with respect to nearby cities:
26 km (16 miles) N (356 degrees) of Oita, Kyushu, Japan
77 km (48 miles) S (172 degrees) of Yamaguchi, Honshu, Japan
109 km (68 miles) NE (49 degrees) of Kumamoto, Kyushu, Japan 610 km (379 miles) SE (136 degrees) of SEOUL, South Korea

ADDITIONAL EARTHQUAKE PARAMETERS
________________________________
event ID : US tbb4

This event has been reviewed by a seismologist at NEIC For subsequent updates, maps, and technical information, see:
http://earthquake.usgs.gov/eqcenter/recenteqsww/Quakes/ustbb4.php

Chrysler CEO LaSorda aims for small car partner by end of '06

Tom LaSorda

Reuters / DETROIT (Reuters) -- The Chrysler group aims to finalize by the end of this year a partner to build and launch a subcompact car, CEO Tom LaSorda said today.

LaSorda, speaking to the Automotive Press Association, also said the company has not ruled out China as an export hub for the new car.

"We know we can't do it alone," he said. "The capital expense alone would be very high."

Chrysler currently has no model in the subcompact car segment, which is popular outside United States.

The company had been in talks with automakers in Europe and Asia, LaSorda said.

"If we cannot find a partner with a profitable business case we will not go into that segment," he said.

Chrysler showed a small car concept called Hornet earlier this year at the Geneva auto show, which could indicate the design direction of the small car if Chrysler decides to enter the segment.

The company is also in the midst of assessing its overall cost structure as it faces a glut of unsold pickups and SUVs.

The Chrysler group on Tuesday, Sept. 19, said it would slash current-quarter production by 24 percent. The company is forecasting a loss expected to reach $1.5 billion in the third quarter.

LaSorda said today that Chrysler would try to reopen talks with the United Auto Workers union aimed at clinching an agreement to cut its $2.3 billion in annual spending on worker health care.

"Obviously we hope to keep the dialogue going," he said. "We will see what happens."

Mercedes plans to use urea system in new U.S. diesels

Automotive News - - In 2008, Mercedes-Benz plans to sell three diesel-powered vehicles that use a controversial urea-injection system to control emissions.

Mercedes says the three vehicles -- the M, R and GL-class SUVs -- will meet 2010 emissions standards requiring diesel engines to run as cleanly as gasoline engines.

The key to launching the vehicles in all 50 states is the urea-injection system, also known as selective catalytic reduction. SCR reduces oxides of nitrogen, the smog precursor known as NOx, by injecting urea periodically into the exhaust system.

But if the ammonia-based acid runs out, the vehicle no longer will meet emissions standards.

That has EPA regulators worried because they don't like systems that depend on drivers' maintenance. The agency plans to release guidelines for urea in the coming weeks.

The EPA rules will spell out such things as how automakers must warn drivers when the fluid is running low, how long the vehicle can be allowed to run without urea and drivers' ability to buy and refill urea throughout the country.

In Stuttgart, Mercedes-Benz spokeswoman Edith Meissner said the automaker sees no unsolvable problems with the warning system or urea availability.

"There are negotiations with suppliers and the EPA. We expect they will be finished in the next month," Meissner said. "The good news is that it seems we will find a solution. The question is which solution is the preferred one. But there is no hurdle, no obstacle."

Because of strict emissions rules, Mercedes diesels have been shut out of California since 1999. New York, Connecticut, Vermont, Massachusetts and Maine also have adopted California's emissions standards. Mercedes is especially eager to re-enter California and New York with its diesels, not only because those states are two of the largest but because Mercedes diesels traditionally have sold well there.

Meissner said the urea warning system would include a text message that tells drivers how many miles they can drive before the fluid runs out. She also said Mercedes is working on a distribution system for urea that is independent of dealership service departments.

"The idea is: If you can sell Coca-Cola and windshield-washer fluid at filling stations, you can also sell urea in small amounts, such as half a gallon or one gallon," she said.

Mercedes wants drivers to have the urea tank filled at the dealership at each scheduled oil change. But Meissner said the company also is working to set up a hot line for drivers to call so they can get urea sent to them overnight if the tank should run out in an area of the country where there is none available.

BRABUS rocks the new Mercedes CL coupes

Click to enlarge

AUTOBLOG.COM | Alex Nunez | GERMANY - - We are almost out of words with which to describe the ferocious vehicles created by German übertuner BRABUS, but since it continues to pump out wonderful new toys, we must soldier on and communicate the good news from Bottrop. The arrival of the new Mercedes-Benz CL-Class is now supplemented by Brabus' announcement of a tuning program for the car.

The details are familiar by now, but that doesn't make them any less impressive. For the CL 500, Brabus offers a tuning kit that boosts output to 419 horses, and for the more adventurous, a 6.1L engine upgrade that brings 462 ponies to the party. This is all well and good, but the big fun is reserved for the CL 600, which receives the Brabus 6.3L SV12 S Biturbo replacement engine. Its 730 horsepower is enough to make even the forthcoming CL 63 AMG weep. Tires will be happy to know that torque is electronically limited to just 738 lb-ft. That should enable them to last hours instead of mere minutes. A high-performance brake system is available to bring it all to a rest.

As is the case with every Brabus automobile, a full, tasteful aero kit is offered, complete with detail touches like integrated entrance/approach lights that make loading up and getting into the car at night a bit more pleasant. A lowered sport suspension, new wheels and tires, and a new exhaust system round out the technical improvements. In terms of creature comforts, Brabus will customize the interior to the buyer's taste (good or bad).

The cost isn't given, but expect it to be in the realm of "a lot." For those who can foot the bill, a new rocketship awaits.

(Pics, press release after the jump)

[Source: BRABUS]

DaimlerChrysler mum on Chery partnership report

Reuters / September 25, 2006 - 9:00 am FRANKFURT -- DaimlerChrysler AG declined comment on a magazine report today that it had picked China's Chery Automobile as a partner to build subcompact models for sale in the United States under the Dodge brand.

Germany's Der Spiegel said the partners would also examine joint production of small cars that could appeal to U.S. customers amid near-record fuel prices.

DaimlerChrysler has confirmed it is seeking a partner for the project, and industry sources have said candidates included Chery, Japan's Mitsubishi Motors Corp. and South Korea's Hyundai Motor Co. Ltd.

Volkswagen has dropped out of the search.

The Chrysler group needs a partner because of the costs of designing, manufacturing and marketing a new car that can take up the slack from faltering sales of pickups and SUVs.

Last year, the U.S. subcompact segment topped 180,000 vehicles -- only 1 percent of the overall market -- but is expected to surge to 290,000 this year and about 370,000 in 2007 because of increasing consumer concern over fuel prices.

Chery is among a handful of upstart Chinese vehicle makers, including Geely Automobile Holdings Ltd. and Great Wall Motor Co. Ltd., that are eager to push exports to diversify beyond the potentially saturated home market.

Chery aims to sell at least 30,000 vehicles outside China this year, accounting for 10 percent of its total sales volume.

Glut Threatens Chrysler's '07s

2006 models, like the Dodge Durango, are not selling well for Chrysler.

Dealers cut down on orders of the new cars as they try to move a pile of '06s

By BRADFORD WERNLE | AUTOMOTIVE NEWS

AutoWeek | Published 09/25/06, 8:34 am et DETROIT -- Some Chrysler group dealers are virtually halting their purchases of 2007 vehicles because they still have too many 2006s parked on their lots.

"Until I get rid of these 2006s, I'm not even looking at 2007s," says Mike Christopoulos, owner of Olympic Dodge Inc. in Chicago. "First of all, interest rates are too high, and there's no customers walking through the door."

Bloated backlogs of 2006 cars and trucks, on top of high floorplan interest rates, have driven up the cost of doing business. That has caused many dealers to cut back on buying.

Chrysler group executives admitted last week that they had produced too many vehicles for months and announced they will slash production. Dealers may want to help Chrysler but say they have to be sensible businesspeople, too.

Group 1 Automotive Inc. in Houston, which owns 28 Chrysler group franchises, is watching its purchases of 2007s, says Randy Callison, Group 1's senior vice president for operations and corporate development. Inventories of Chrysler vehicles are above 75 days, the Group 1 target for domestic brands.

"They'll help you with your flooring expense," Callison says of Chrysler. "The problem is you don't know how long you'll have to sit on the cars. Is it good business to take those cars?"

Chrysler is counting on robust sales of 2007 models to lift it back into profitability after a summer sale fizzled and the group announced a huge impending loss in the third quarter. Several of the new vehicles are smaller and more fuel efficient than the slow-selling trucks and SUVs that Chrysler has depended on.

'Very challenging'

Chuck Eddy, co-owner of Bob & Chuck Eddy Chrysler-Dodge-Jeep in Youngstown, Ohio, credits Chrysler executives with acknowledging that they didn't slow production fast enough. He says dealers should help the company out of its jam.

But Eddy has slowed his purchases. "It's very, very, very challenging, to say the least, right now with inventory levels and costs," Eddy says.

"I think they're going to have a hard time selling all the cars they need to by the end of the quarter. There's going to be a significant amount of cars carrying over.

"Interest rates are up, and my inventory is up. It's a bad combination."

Chrysler group spokesman Kevin McCormick says Chrysler inventory had been "a little slow in the beginning because dealers were already carrying an inventory."

"Because we are directly addressing that situation with them, we would think that orders that looked like they were lower would begin to rebound."

Not all dealers are backing off orders. John Schenden, owner of Pro Chrysler-Jeep Denver, says he is happy with his inventory and with the new models coming in. "We have an orderly plan to get out of the '06s," he says. "We have about the same number we had last time."

With the new Chrysler Sebring, Jeep Compass and four-door Jeep Wrangler Unlimited, Schenden says: "I have to increase my inventory to accommodate those new products. It's a nice problem."

Last week, DaimlerChrysler AG CEO Dieter Zetsche said Chrysler has cut third-quarter deliveries to dealers by 90,000 vehicles, to 290,000. That's down nearly 24 percent from the planned 380,000.

Chrysler says it will reduce second-half retail shipments by 16 percent from what it had planned. Zetsche announced the cuts last week, four days after the company said Chrysler's third-quarter loss would be $1.52 billion, more than twice the $600 million it had forecast.

Chrysler reduced its supply from 93 days in July to 76 days in August. Says Chrysler spokesman Jason Vines: "We're getting inventory in line and allowing space for new stuff."

He admits that Chrysler's earlier programs, including its summer employee-pricing sale, didn't do the job because production stayed too high: "We were bailing water out of the boat with a hose in the boat at the same time."

Accepting blame

Last week, Zetsche and Chrysler group CEO Tom LaSorda accepted blame for not curtailing production when it became evident that sales were falling. But the Chrysler group's inventory has been swollen since late last year. The company paid dealers as much as $750 per unit to take extra stock after its supply reached 92 days Dec. 1.

A Michigan dealer who declined to be identified says Chrysler not only produced too many cars and trucks but also made the wrong mix. The automaker pushed feature-laden vehicles that dealers are hesitant to buy.

The dealers says: "The bean counters said, 'This is the mix you need to sell to hit targets for profitability.' They ended up with a huge sales bank of cars, a mix we as dealers wouldn't order.

"They kind of jammed us. We all took way too much inventory. The net result is we're still sitting on too many cars, and there ain't nobody making any money because we're all paying the juice on these things at 9-plus percent."

Smart fortwo out and about during the London Fashion Show

Posted Sep 24th 2006 1:19PM by Sebastian Blanco

AUTOBLOGGREEN | LONDON UK - - Most autophiles eyes' will be turned to Paris this coming week (and keep a browser tab on Autoblog and AutoblogGreen for up-to-the-minute on-the-scene coverage), but if you were checking out the London Fashion Week last week then you were treated to another small car covered in models (in case you missed the first one, click here). This car, a smart fortwo, was used to shuttle top runway models from the Storm Model Management agency around to the various designers' shows. The managing director for Mercedes car group, was all about the sexy model. "The car has always been a trend-setter in the design stakes and we're delighted that Storm have made the smart choice," he said.

This Day in Auto History: 25 September

9.25.1891 - Max G. Paulus of the Standard Oil Company of Indiana is born in Baltimore, MD

9.25.1924 - Malcolm Campbell, driving a Sunbeam at Pendine Sands, Wales, raises the land speed record to 146.157 mph - this was the first of nine times that he would raise the record

9.25.1939 - Racer Neville Lederle is born in Theunissen, South Africa

9.25.1962 - General Motors announces a two-year, 24,000-mile blanket warranty on all of its 1963 cars and trucks

9.25.1965 - The 1966 Ford Thunderbirds are introduced

Source: Automobile History Day By Day, by Douglas A. Wick

Nationwide Gasoline Prices

The prices below are for regular gasoline as of 9/25/2006 11:06:41 AM local time.

Show average prices by metro area

Area Average Price Current Trend Missouri 2.048 Kentucky 2.092 IowaState 2.096 Indiana 2.101 Ohio 2.106 Kansas 2.125 SouthCarolina 2.145 Georgia 2.147 Oklahoma 2.164 Tennessee 2.175 NorthDakota 2.176 Minnesota 2.188 Arkansas 2.212 NorthCarolina 2.228 Virginia 2.229 Alabama 2.230 Michigan 2.237 Mississippi 2.243 Texas 2.245 Delaware 2.247 Louisiana 2.285 NewJersey 2.290 SouthDakota 2.301 WestVirginia 2.304 Illinois 2.312 Nebraska 2.323 Pennsylvania 2.342 NewHampshire 2.361 Wisconsin 2.369 Massachusetts 2.371 FloridaState 2.396 Maine 2.409 Maryland 2.414 Arizona 2.479 RhodeIsland 2.516 Vermont 2.518 Wyoming 2.562 Montana 2.575 Colorado 2.598 Connecticut 2.604 NewMexico 2.618 California 2.694 Oregon 2.696 NewYorkState 2.708 Idaho 2.717 Washington 2.745 Utah 2.802 Alaska 2.839 Nevada 2.878 Hawaii 3.246