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Automotive Industry Increases Service Profit With BrakeStrip Testing

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Phoenix Systems

Take the fear out of braking.

BrakeStrips are used by the military and approved for use by the US Air Force. – Jon Petty

Saint George, UT (PRWEB) April 17, 2014

Large national service providers are experiencing rapid growth in Brake Fluid Exchanges over the last year. This increase is due to Phoenix System’s patented product, BrakeStrip. Now, for the first time, they are making this product available direct to new car dealerships.

Using the Motorist Assurance Program (MAP) guidelines, these strips are like a wear indicator for brake fluid. Brake system corrosion can lead to ABS damage, brake system failure, and longer stopping distances. Dealerships can utilize this product to increase their Fixed Ops revenue by easily showing their customers the results of their brake fluid safety inspection as the strip changes colors.

“The government and military have run studies on the brake fluid change indicator,” Jon Petty, President of Phoenix Systems, said. “They have proven that copper can actually plate to ABS components, causing them to not operate properly. Brake lines have a copper lining that begins a slow corrosion process from the time the brake fluid is added. BrakeStrips are used by the military and approved for use by the US Air Force.”

Phoenix Systems, technology leaders in the automotive industry, has also performed extensive testing and found that the best indicator of when your brake fluid needs to be changed is not in the moisture, but actually in the copper corrosion levels. Armed with this new knowledge, they created and patented BrakeStrip, a 60-second test that identifies serious brake system problems before they occur.

Brake fluid is considered the lifeblood of the braking system. Just like your engine’s oil, brake fluid wears over time. This leaves the brake system unprotected and vulnerable to corrosion. Many dealerships recommend brake fluid changes, but do not have the technology and testing tools to back it up. With BrakeStrip, they can explain to their customers about copper content with a visual chart to back it up. No longer will they have to use the fall-back of “it looks dirty.”

“Dealers are always looking for a unique service they can offer consumers to get them in the service drive,” Peter webdoc Martin, President of Cactus Sky Digital, said. “We have begun incorporating complimentary brake fluid inspections with these test strips for our automotive clients and are seeing, significant increases in the amount of brake fluid exchanges in the service department. You simply dip the strip in the brake fluid and match the color to the chart. It provides an undeniable visual to the customer. One large national service provider with over 900 stores went from 1 million to 9 million in brake fluid exchanges over the course of a year due to this product. That’s pretty impressive.”

For more information on the BrakeStrip product and testing results, visit

About Phoenix Systems

Phoenix Systems is committed to providing progressive tools and technology for the auto care industry. Founded on the idea that persistently applying new technologies to existing challenges will result in better solutions, Phoenix Systems prides themselves in their commitment to the success of their clients. They are constantly creating new and innovative solutions to drive greater value to their customer’s bottom line.

Phoenix systems holds over a dozen US and foreign patents as a result of their efforts in the automotive industry. Every tool they make utilizes new patented technology so customers can rest easy, knowing there are no “me too” tools in this industry.

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For the Auto Industry, a Showcase for Change

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General Motors Company Takes a $1.3 Billion Bullet for the Automotive Industry

General Motors CEO Mary Barra testifying before the Senate subcommittee. Source: General Motors.

What the heck is going on with the automotive industry? It seems as though not a day passes without another massive recall announcement. General Motors‘ (NYSE: GM  ) ongoing debacle regarding 2.6 million vehicles with faulty ignition switches that could flip to the off position and cause a car to lose power is dominating the headlines. The technical fault is linked to at least 13 tragic deaths, and General Motors is being investigated for possible wrongdoing. 

However, have you heard about Toyota‘s (NYSE: TM  ) recall of nearly 6.4 million vehicles worldwide? What about Fiat Chrysler Automobiles  (NASDAQOTH: FIATY  ) recall of nearly 868,000 vehicles across the globe? Or Ford‘s (NYSE: F  ) recall of nearly 435,000?

The situation playing out in the automotive industry right now has General Motors taking a bullet for the automotive industry, and rightfully so.

GM’s highly public and highly humiliating recall of millions of vehicles, in which the fatal problem was identified years ago, is almost certainly going to call more attention than any other current vehicle recall. The rest of the industry is taking advantage of the situation by announcing their recalls while all eyes are firmly fixed on GM.

In case you missed details on the rest of the auto industry’s recalls, here’s a quick recap.

Toyota announced last week a massive recall of 6.39 million vehicles for a range of problems. The recall covers five separate problems, ranging from faulty airbags to defective windshield wipers, and includes about 2.34 million vehicles in North America. While the overall number of affected vehicles is significantly larger than the number in General Motors’ initial and highly controversial recall, Toyota is so far unaware of any crashes, injuries, or deaths connected to the vehicles, therefore this story is much less of an attention grabber. 

Earlier this month, Chrysler recalled 867,795 Jeep Grand Cherokees and Dodge Durangos to install a shield that would protect brake boosters from water corrosion, according to Bloomberg. Ford has also recently announced recalls of nearly 435,000 vehicles for rusting frame parts and faulty seats. So what do all of these recalls mean for GM and the automotive industry?

What to expect
General Motors has also announced additional recalls, pushing the total number of vehicles past 6 million worldwide. America’s largest automaker might as well get it all out in the open now.

Directly, General Motors is going to take a $1.3 billion charge due to the recall in the first quarter, which is $1 billion more than the original estimate. Biting that bullet threatens to consume all of the company’s first-quarter profit, and again, rightfully so. 

That might only scratch the surface of the true cost to GM. We have to consider negative effects on the company’s future sales and brand image, which has already been battered by GM’s bankruptcy. Furthermore, the competition can largely avoid negative results from their own recalls by essentially hiding behind General Motors’ troubles. Perhaps these are all deserved punishments considering that GM appears to have made a very poor decision more than a decade ago that it was cheaper to fight in court rather than fix product defects. 

This recall saga is far from over, and could easily get worse for General Motors as the federal investigations continue. As for the automotive industry as a whole, don’t be surprised if these aren’t the last recall announcements you hear about over the next few months — or maybe don’t hear about, thanks to GM’s massive debacle.

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Are Price Wars Driving Automobile Industry Sales?

Car sales in Europe continue to grow, but there are concerns that discount is dictating growth.

Car sales in Europe grew for a seventh consecutive month in March, but there are concerns the growth is ‘artificial’.

Sales skyrocketed by 10.6% in March in comparison to 2013 results, with a total jump of 8.1% since the turn of the year largely driven by the industry’s major players.

Renault reported a 29% rise in sales in March, whilst Ford reported a 14% rise and Peugeot 11%.

“The numbers for the first quarter and in particular for March are superb,” Hans-Peter Wodniok, an analyst at Fairesearch GmbH in Kronberg, told Bloomberg Business Week. Adding that the U.K. “is really the driving force when you look at the other large European markets.”

The UK (17.7%) and Spain (10.0%) both recorded double-digit growth, says a report from the European Automobile Manufacturers Association, whilst almost one and a half million new vehicles were registered in the EU.

However, according to Reuters, despite the growth in sales, manufacturers are still engaged in a price race to the bottom.

Discounts have grown faster than sales in 2014 casting a shadow over the ‘recovery’ of the automobile industry.

Average discounts have risen by 12% in the first quarter to £2,300 (€2750, $3,800), leaving some wary over the legitimacy of the sales growth.

“There should be significant concern about artificial growth,” Ernst Young’s senior automotive partner Peter Fuss told Reuters, adding that the industry’s profitability “continues to be under severe pressure.”

The car market is expected to grow slowly – experts predict 3% by the end of the year – but it’s going to take a long time for car sales to get back to where they were pre-2008, say forecasters.

Recent figures show that it’s not just those in the automotive sector that are slashing prices to keep the consumer happy as we nurse our economy back to full health.

The British Retail Consortium said that high street prices at the start of March were 1.7% lower than at the same time in the previous year, making it the biggest annual decline in any month since the series began in 2006. It was the 11th consecutive month in which prices had fallen.

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Study: Tesla now ranks 6th in auto industry influence

NEW YORK — Electric-car maker Tesla is one of the smaller automotive brands, but it is already cutting an outsized profile, according to findings of a study of influencers in the auto industry.

Tesla is ranked as the sixth most influential automaker in the study by Appinions, which says it “reviews full-text from online, offline and social sources” to determine what individuals and companies are most influencing others. The Auto Influence Study comes conjunction with this week’s media preview of the New York Auto Show.

Tesla’s CEO, Elon Musk, ranks second among individuals behind General Motors CEO Mary Barra.

When it comes to automakers, the top five are General Motors, Ford, Chrysler, Toyota and Volkswagen. Then comes Tesla, which is trailed by such big-name automakers as Honda, BMW and Mercedes-Benz parent Daimler.

Besides the overall second-place ranking for Musk, he is considered the most influential executive when it comes to issues of technology or fuel economy by Appinions. He ranks above industry luminaries like Fiat-Chrysler’s Sergio Marchionne or Ford’s Alan Mulally.

“Elon Musk pushes two central issues, affordable electric vehicles and method of purchase for consumers,” the report says. The “method of purchase” is apparently a reference to Tesla’s high profile battles to sell cars directly to consumers in states that have strong auto dealer franchise laws.

Musk, the report says, “is the face of Tesla.”

Despite its high profile in the realm of news and discussion, Tesla is a relatively small player in the auto industry so far. It sold 19,351 cars last year, all of them its only vehicle in production, the electric Model S, according to sales tracker Autodata. That’s about equal to what Lexus sold in a single month, December.

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Slump in automobile market claims 2 lakh jobs: SIAM

NEW DELHI: The longest period of slump in India’s automobile market, with sales declining for a second straight year, has taken its toll with production cuts leading to the loss of about 2,00,000 jobs, according to the Society of Indian Automobile Manufacturers.

“Last year was one of the most difficult periods for the auto industry,” said Vikram Kirloskar, the president of SIAM, who is also the vice-chairman of Bangalorebased automaker, Toyota Kirloskar Motors. “I personally feel that across the entire value chain in the auto industry, right from raw materials to the dealerships there could be around 1.5-2 lakh job losses.”

The Indian auto industry employs around 19 million direct and indirect workers. The industry is already falling behind its target on the job front as it was estimated to employ more than 25 million workers by 2016 under the 10-year Auto Mission Plan of the government. A consistent fall in demand and sales for the past two years is likely to create a huge employment gap.

Car sales in India fell for the second consecutive fiscal ended March 2014 with a 4.65% drop as the auto industry continued to struggle in a sluggish economy. Besides the decade’s steepest decline in car sales, heavy trucks and buses continued its negative sales streak for the past 25 months.

The industry is not expecting an immediate turnaround, even with a cut in excise duty. According to industry sources, the biggest job losses would have occurred at the retail levels, mainly dealerships that sell all class of vehicles – from bikes to trucks. It also hit the component manufacturers hard.

Many auto companies have gone for downsizing. India’s largest auto company by revenues, Tata Motors had undertaken an Early Separation Scheme last year to reduce manpower by as much as 5,000 workers across its plants at Jamshedpur, Pune and Lucknow.

More than 500 managers had left the Chennai-based Ashok Leyland as part of its voluntary retirement scheme in November 2013.

Due to declining sales for the past two years companies are enforcing regular production cuts and industry executives said that job losses in the sector are quite common.

Market leader Maruti Suzuki had closed its five plants for eight days in June last year to reduce its swelling inventory at factory and dealers while others players like Mahindra Mahindra, General Motors, Skoda Auto also undertook plant shutdowns and retrenched their casual and temporary workers to align production with the slowing market conditions.

In a major setback to the passenger car segment Hoover India limited, which was a master franchise of Japanese carmaker Nissan, shut its office leaving hundreds of its employees jobless. Analysts tracking the sector said that the trucks and buses segment was the hardest hit.

“Auto industry is one of the key industries which contribute to growth in the employment of manufacturing sector. It is difficult to give the exact number of employment loss but it can be anywhere in the range of 1.25 to 1.5 lakh,” said Abdul Majeed, Partner Auto Expert with Price Waterhouse.

Automotive dealers, who are facing the brunt of the slowdown, have been shedding staff to keep their business viable. “The initial signs are not good. For the first time in the last fiscal the retail sales or deliveries to customers were weak and that impact our turnover and profit margins,” a Maruti Suzuki dealer said.

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Automotive industry grows by 19 percent in Q1 of 2014

FDI rises by 8 percent in January y-o-y to 244 million Euro

Foreign direct investment (FDI) totaled 244 million Euro in the first month of the year, up 8 percent compared to January 2013, after reaching a four-year peak last year, n…

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News Analysis: Car industry in Slovakia lacks highways, education

BRATISLAVA, April 16 (Xinhua) — The development of the automobile industry in Slovakia faces neck-bottled problems with the absence of highway connecting western regions with the East and the lacking of skilled labor force, the industrial experts stressed.

Slovak Automobile Industry Association (ZAP) chair Jaroslav Holecek said there is a space even for a fourth automobile manufacturer in Slovakia after Volkswagen, Kia and PSA Peugeot-Citroen.

“It’s not under consideration at the moment, but there surely is adequate room for even two car producers in the area between Banska Bystrica, Zilina and eastern regions,” he claimed.

The most urgent challenge for companies is the completion of an expressway from Zilina in the North to eastern Slovakia, said Holecek.

“I believe the course of the past decade has been wasted with meaningless and trivial quarreling between politicians. We’ve lost millions over decisions on whether or not the expressway would be profitable. Simply put, it should have been built a long time ago,” he said, adding that 75 percent of the 300 subsuppliers for automobile industry are based in western Slovakia.

The car industry has served the last 10 years as the workhorse of the Slovak economy, with a 43-percent share in total industrial production of the country. It also forms 26 percent of Slovak exports and provides direct employment to 60,000 people.

“The proportion of the automotive industry in Slovakia’s GDP stood at 6 percent last year. If we considered suppliers for car plants as well, then the figure would be even higher,” said Slovenska Sporitelna bank analyst Martin Balaz.

“The building of new capacities in car plants contributed significantly to economic growth especially last year,” he added.

The sector’s influence doesn’t end here, however. As UniCredit bank analyst Lubomir Korsnak pointed out, car plants are also somewhat of a driving force behind certain services such as transport, logistics and retail. “Suppliers for the automotive industry can also be found in other industrial sectors such as metallurgy and the production of rubber and plastics,” said Korsnak.

But there is a clear potential barrier for further development of the car industry in Slovakia – the education system. Holecek finds it paradoxical that although the unemployment rate is relatively high, companies face a lack of qualified workers.

“Our prognosis shows an annual need for 42,000 new employees with high school education, 30,000 of whom would serve only to replace retiring workers. On the other hand, according to statistics, fewer than 5,000 high school graduates land jobs in their respective fields of study,” he said

In order to change this unfavorable state of affairs, a wholesome transformation of the school system is required.

ZAP would like to see elements of a dual system introduced into the high school education system, one in which students would acquire more practical skills with companies in the industry.

Slovakia also needs to have its research and development fields more oriented toward practice. “Science and innovations are not linked with the needs of our most important industry,” Holecek said.

ZAP hence proposes the creation of a center for strategic research and development, which would be specialised in the automobile industry and serve a number of companies.

In 2013, Slovakia once again dominated the world chart in car production, with 181 automobiles produced per capita. Overall car production is still increasing its volume and 980,000 vehicles were manufactured in 2013 in the three Slovak assembly plants of Volkswagen, Kia and PSA Peugeot-Citroen.

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South Africa’s Auto Industry Receives $71M Boost


Vrooom! “South Africa’s automotive industry will see several firms investing over 71 million dollars in setting up plants and expanding operations,” reports CNBC Africa.

“Toyota SA would be investing approximately 33.2 million dollars in a parts distribution warehouse and a new assembly line in Durban. German auto component group, Friedrich Boysen GmbH is putting 16.4 million dollars in a new 10,000 square metre plant and Beijing Automotive Works to stake 17.9 million dollars in a plant expected to service the whole of sub-Saharan Africa,” noted the United Nations Economic Commission for Africa (ECA) report.

BMW is investing heavily — it will add a third shift at its plant and also Mercedes Benz SA which began a workforce recruitment program.

“The automotive and components industry accounts for 30 per cent of South Africa’s total manufacturing output,” head of the National Association of Automotive Manufacturers of South Africa, Johan van Zyl said.

The industry contributes at least six percent to the country’s gross domestic product and accounts for nearly 12 percent of its manufacturing exports.

South Africa’s auto industry includes Toyota, Renault, BMW, Ford, General Motors, Nissan, Mercedes Benz, MAN, DAF Trucks and Tata, among others.

The automobile industry’s success story is due to the government’s 1995 policy – the Motor Industry Development Plan (MIDP).

“Upon inception of this policy, these figures jumped from 388,442 in 1995 to 532,545 in 2011. Exported units jumped from 15,764 in 1995 to 272,457,”reports CNBC Africa.

“The government policy that encourages a proactive approach has helped to drive development in this sector,” read the ECA’s Dynamic Industrial Policy in Africa report.

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Auto Industry Fears Taxation ‘Realignment’


Tribune Business Editor

The Bahamian automotive industry has warned that it will have to “realign” due to the combined impact of Business Licence fee increases and the proposed Value-Added Tax (VAT), a development that could result in job losses and reductions in business size.

The Bahamas Motor Dealers Association (BMDA), in full-page advertisements set to run in the media this week, says the Government has yet to respond to its suggestion that VAT not be charged to consumers “at the point of sale”.

It is calling for VAT to be charged at the border only, so that tax-induced price increases are limited and do not result in a further depression of new/used car sales.

Prime Minister Perry Christie has promised that the Government will not introduce VAT at its initially-proposed 15 per cent rate, something the BMDA said would have increased auto part and vehicle prices by 8 per cent and 10 per cent, respectively.

Labour costs associated with auto service would have risen by 15 per cent, while the way VAT was applied would have cut all vehicle mark-ups by 10 per cent – further exacerbating the impact of price controls.

“BMDA members are urging the Government not to charge VAT to new vehicle customers at the point of sale, as this would increase the retail price even more, causing a further loss of sales,” the advertisement reads.

“Vehicles should only be VATable at the border. Charging VAT on retail will force more people to buy more vehicles overseas, losing warranty protection. This will harm both consumers and businesses.”

With Business Licence fees for the industry now generally pegged at 1.25 per cent of turnover, and real property taxes also on the rise, the advert warned: “The combined effect of these tax changes will force some BMDA members to operate at a loss.

“And this can be expected to bring about a realignment of the industry. Such a realignment could involve staff cuts, facility downsizing and shelving of potential investments.”

The BMDA also expressed concern about the impact VAT’s arrival would have on slow-moving parts in inventory, and the fear they might be exposed to ‘double taxation’ via the old, higher Customs duty rates and new tax.

It warned that new car sales had fallen from a 2007 peak of 4,200 to around 2,200 per annum today, and that the new and increased taxes would impact its ability to ‘hold the line’ on lay-offs.

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