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Ford Profits In Second Quarter

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Ford is bragging a 13% profit rise, the best in six years, thanks to the strong sales of their fuel efficient cars such as the Fusion and the redesigned Taurus, and high tech features such as their in car communications and entertainment system, the Sync.

Ford, which did not file for bankruptcy protection or receive a federal bailout like rivals General Motors and Chrysler, has been saddled with huge debt. It ended the quarter with $27.3 billion of debt even after it paid down $7 billion.

“Overall, our performance this year gives us great confidence going forward,” Ford Chief Executive Alan Mulally. “We are ahead of where we thought we’d be.” With improving profits, the company said it was on track to have more cash than debt by the end of next year.

Subaru Windshield Oily Film Problems

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An oily substance on the windshields of Subaru vehicles is creating visibility problems for many Subaru drivers. The yellowish chemical haze has been reported as being so bad that driving the vehicle is made impossible especially in very bright or night time situations. Solutions offered by dealerships have been to clean the windshield, but the oily film is difficult to remove, and returns in a very short time.

Rumor is that there has been a technical service bulletin issued on the problem, but my searches have come up empty handed. Unofficially, the problem is being blamed on the material used in a rubber seal on the heater box. The material used is “off gassing” to excess causing the build up. The problem is expected to clear up after extended use, but some people with respiratory problems may experience health issues when breathing the fumes.

GM Back In The Auto Financing Business

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In 2006 when GM was faced with $10.5 billion in losses, they decided to sell their credit business, GMAC, so they could use the money to pay down some of its restructuring costs, shut assembly plants and buy out employees. Even though this deal helped GM restructure their company, the bailout in 2009 showed that GM had not learned from their mistakes.

GM announced Thursday, that they would be getting back into the credit business in a recent plan to buy AmeriCredit Corp., in an all cash transaction valued at about $3.5 billion. GM executives have said for months that they were missing sales opportunities due to lack of credit for lease deals and financing for sub prime buyers and that this is an opportunity to bring more people into the showrooms and help them with finance.

The two companies have had a financial relationship for years. AmeriCredit, which already works with about 4,000 GM dealers, now gets about one-third of its business from financing new and used GM vehicles. Overall, the auto financing company has about 800,000 customers and $9 billion worth of auto loans on its books.

The automaker says that its partner, Ally Financial — formerly known as GMAC Financial Services Inc., will continue to finance GM’s dealer inventory and make loans to buyers with good credit. GM says it is not considering a purchase of Ally’s auto financing unit in which GM sold controlling interest in 2006. The company eventually had to be bailed out by the U.S. government because of problems with its home mortgage loan unit.

Many feel that GM’s purchase of AmeriCredit is another multinational corporation finding loopholes to exploit, and that the credit practices that collapsed the sub prime housing market was actually started in the auto finance credit business. The recent Financial Overhaul bill that was just passed by Congress will not be of any help either, since automakers were exempt from it.

Another Subpoena For Toyota

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Toyota has been subpoenaed again by a grand jury, this time for documents related to steering relay rods. A probe was launched when the National Highway Traffic Safety Administration (NHTSA) received documents indicating that Toyota had potentially misled the government in 2005 over problems with steering linkages in its 1989-95 4Runner and the 1993-98 T100 vehicles. The subpoena, issued June 29, requests documents related to “defective, broken and/or fractured steering relay rods of Toyota vehicles,” Toyota said in a filing with the Securities and Exchange Commission.

In February, the same federal grand jury subpoenaed Toyota for information related to unintended acceleration in its vehicles as well as braking systems in the Prius hybrid. Toyota has also received subpoenas related to sudden acceleration from the SEC and the attorney general of Michigan. Toyota did not disclose which vehicles or model years were targeted by the latest subpoena.

Air Or Nitorgen In Tires

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We have been told that maintaining the correct tire pressure of your vehicle helps optimize the performance and fuel economy of the car as well as stabilizes the tire’s structure giving better responsiveness, traction and handling. Nitrogen has long been used in aircraft tires and in race cars and has recently become controversial on whether it would be beneficial to be used in tires of the average road cars.

Proponents of nitrogen argue that studies show that less than 60 percent of drivers check the inflation of their tires regularly so the use of nitrogen can offer drivers many benefits.

  • Because the nitrogen molecule is larger than oxygen, it will not leak out of the tire as quickly.
  • Nitrogen does not expand and contract as much as oxygen, so tire pressure will be maintained at an optimal level.
  • Nitrogen contains no water vapor, so it is less likely to degrade the interior rubber of the tires and corrode the rims of the vehicle.

As for the cons of using nitrogen, the air around us is already 78 percent nitrogen, with 21 percent oxygen and 1 percent other gases, so going to pure nitrogen reduces the amount of oxygen a small amount.

  • A Nitrogen filling station is more difficult to find, and as soon as oxygen is used, all the benefits of nitrogen will be lost.
  • The biggest factor, the price. Filling your tires with air is free, so will the price of using nitrogen outweigh the benefits claimed by using it? That could be difficult to prove.
  • Finally, the claim that nitrogen reduces the degradation of tires and rims, is questionable, since tires wear from the outside from use and road conditions, so the protection offered by nitrogen from the inside is quite minimal.

Whether nitrogen is better than oxygen is difficult to prove. The best defense in keeping your tire pressure at the right level is to check your tire pressure regularly. Many new vehicles have tire pressure monitoring, and many after market tire monitoring kits are affordable, so monitoring your tire pressure is easier than ever. Regular maintenance and care is usually the best for keeping your vehicle running optimally.

GM Confident In Volts Battery

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According to GM executive director of global electrical systems, “The Chevrolet Volt’s batteries have exceeded performance targets and are ready to hit the road.” To prove it, Chevrolet is offering one of the automotive industry’s longest, most comprehensive battery warranties for an electric vehicle. The standard 8 year, 100,000 mile warranty will also be transferable at no extra cost to other vehicle owners.

The Volt’s comprehensive battery warranty covers all 161 battery components as well as the thermal management system, charging system and electric drive components, which allows the Volt to operate under a full range of climates and driving conditions without concern about being stranded by a dead battery. It has a range of about 340 miles and is powered with electricity at all times. For up to the first 40 miles, the Volt is powered solely by electricity stored in its 16-kWh lithium-ion battery, using no fuel and producing no emissions. When the Volt’s lithium-ion battery runs low, an engine/generator operates to extend the driving range another 300 miles on a full tank of fuel.

According to Nancy Laubenthal, plant manager of the Brownstown Battery Plant, “We’re moving fast to deliver for the customer and ensure the Volt launch stays on track.” “Last August we announced the investment in the Brownstown facility and in January built our first completed battery pack. Now we are finishing pre-production batteries and soon we will begin building production batteries for Chevrolet Volts that will be delivered to dealers before the end of the year.”

Toyota’s Electric RAV 4

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The joint venture between Toyota and Tesla Motors, will have us seeing an electric version of Toyota’s RAV4 on the roads as early as 2012. Toyota has made a limited number of electric RAV4’s in the past, but have never commercialized the vehicle. The few RAV 4 EV’s that have been running for the past ten years in fleets and in private hands has been considered a terrific workhorse for those driving it. In this new venture, Toyota gets to re-energize their once innovative small crossover vehicle, and Tesla can show that their style of battery and energy management can support large-scale usage.

Tesla is best known for their first and only electric car, the Roadster, which was introduced in 2008, but hopes to expand their market with their Model S sedan which it plans to start selling in 2012. With the e-RAV4 they hope to expand the market even further for electric vehicles by giving ‘soccer moms’ and small business owners a vehicle they can use on a daily basis.

Chrysler Recall For Braking Problems

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Chrysler and the National Highway Traffic Safety Administration (NHTSA) will be recalling certain 2010 Jeep Liberty, Jeep Wrangler, Dodge Nitro and Dodge Ram vehicles which were built will a defective part that could affect the braking ability. In certain models, the improperly formed part could allow brake fluid to drain out of the system leading to a loss of braking.

Although the NHTSA notice has already been issued, a full recall won’t take place until August, where dealers will install replacement brake tubes on affected models free of charge. If you have questions you can call Chrysler at 800-853-1403, or the NHTSA at 888-327-4236.