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China Car Billionaire Wants Competitors to Bring It On

Bring it on. That’s the message Li Shufu, the Chinese billionaire chairman of Volvo Cars, wants the
government to give competitors in the largest auto market.

“It’s best if it’s completely open, like in the U.S. and
Europe; whoever wants to produce cars can do it,” Li, who’s
also chairman of carmaker Geely Automobile Holdings Ltd. (175), said
in an interview. “This is fair to us, it’s fair to everyone. It
would completely allow the role of the market and perhaps we
will develop better.”

Li, set to unveil the first new Volvo developed jointly
with Geely Aug. 26, has previously called on the government to
give foreign carmakers more control over their operations to
quicken competition and bring down prices. The China Automotive
Technology and Research Center, which helps draft policies, said
in June it is proposing two to three electric-vehicle making
licenses for companies other than carmakers.

In the market for conventional vehicles, Li, 51, has also
pushed for easing regulations.

China requires carmakers based outside the country to work
with local partners and enforces rules that limit the companies’
decision making. Geely, whose sales fell 29 percent by volume in
the first half to 187,186 units, is trying to boost sales by
reducing the number of brands it sells.

Photographer: Tomohiro Ohsumi/Bloomberg

Geely Automobile Holdings Ltd. Emgrand EC7 sedans go through the inspection area on the production line at the company’s factory in Cixi, Zhejiang Province, China. Geely is trying to boost sales by reducing the number of brands it sells. Close

Geely Automobile Holdings Ltd. Emgrand EC7 sedans go through the inspection area on the… Read More


Photographer: Tomohiro Ohsumi/Bloomberg

Geely Automobile Holdings Ltd. Emgrand EC7 sedans go through the inspection area on the production line at the company’s factory in Cixi, Zhejiang Province, China. Geely is trying to boost sales by reducing the number of brands it sells.

The government has said the country’s auto industry, with
about 110 competing brands, should consolidate and it has
threatened to cancel the permits of automakers that do not meet
the minimum production levels by October next year of at least
1,000 passenger vehicles or 50 medium to heavy trucks, depending
on their category.

Lacking Competitiveness

China’s industry minister Miao Wei said in March local
automakers aren’t competitive enough and lack the capability to
expand overseas. He said the government isn’t working on plans
to lift the 50 percent limit on foreign ownership of carmakers.

Li said in an interview last month in Hangzhou, China, that
he welcomes entrepreneurs from information technology and other
industries to enter the carmaking industry.

“The country shouldn’t impose thresholds. But the country
should have standards. It should use the law. Whoever
manufactures the product must bear responsibility for the
products,” he said. “Whether the threshold is scientific or
fair, that’s important. At least, I think, China’s automobile
industry’s threshold now has room for adjustment.”

Geely was the first private automaker in China when it
started 17 years ago. The company paid Ford Motor Co. (F) about $1.8
billion for Volvo Cars in 2010.

Chinese brands’ passenger vehicle market share in the first
six months of this year fell to 38 percent, a 3.5 percentage
point drop from the same period last year, according to data
from the China Association of Automobile Manufacturers.

China’s state-backed auto association estimates the vehicle
deliveries will rise 8.3 percent this year.

(Volvo’s acquisition value was corrected in a previous
version of this story.)

To contact Bloomberg News staff for this story:
Alexandra Ho in Shanghai at

To contact the editors responsible for this story:
Young-Sam Cho at
Dave McCombs, Chua Kong Ho

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Automotive industry not bothered by planned fuel-price

© 2014
PT. Niskala Media Tenggara

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Automotive Industry Hurt by Economic Crime

Economic crime in the automotive industry is on the rise with 28% of the automotive respondents reporting that their companies experienced an incident of economic crime, up slightly from 25% in 2011. Among the top types of economic crime in the automotive sector, 74% are committed by internal perpetrators, making it the industry with the highest rate of insider crime. Most internal perpetrators were either senior executives (23%) or middle managers (54%).

Top types of economic crime in the automotive sector include:

  • Asset misappropriation (74%);
  • Procurement fraud (34%);
  • Bribery and corruption (34%);
  • Human resources fraud (13%); and
  • Cybercrime (13%).

“Economic crime results in significant revenue lost as well as impacting employee morale,” said Ted Hawkins, partner, PwC US Forensic Services. “As the automotive industry continues to do business on a global basis, it becomes even more important to implement a fraud risk management strategy to fight against these types of crimes. When automotive companies invest in emerging markets, these types of crime-fighting tools can help to uncover so called kick-back schemes and unethical vendor selection.”

Survey results indicate that only about half (48%) of the automotive sector’s companies have conducted a fraud risk assessment at least annually over the past 24 months–and 27 percent  haven’t completed one at all.    

For more information about PwC’s Global Economic Crime study, visit or download PwC’s 365 app.

About PwC’s Automotive Practice

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The Changing Geography of the American Auto Industry

An ancient Greek philosopher once commented that there is nothing permanent except change. This is certainly true of the American auto industry, which has been transformed over the past three decades.

The companies making vehicles in America changed, and the location of auto production also changed. Future change in the industry could impact its manufacturing geography once again.

A Brief History
The restructuring of the American auto industry began in the 1980s – and accelerated during the Great Recession, which resulted in the bankruptcies of GM and Chrysler. Since the Great Recession, the industry has recovered, with U.S. production close to pre-recession levels. The industry is once again profitable and growing, leading to new opportunities for communities seeking auto-related investment.

Auto assembly plants are among the crown jewels of economic development. A typical auto plant will employ up to 5,000 people, with above average wages and benefits, and will generate thousands of spinoff jobs. According to the Center for Automotive Research in Ann Arbor, Mich., every assembly plant job creates a total of 10 jobs in the supplier and support industries.

The auto industry also spurs huge RD expenditures – both by the automakers and their suppliers. Booz Co. estimates that the global auto industry spent $102 billion on RD in 2013, about four times more than the aerospace and defense industry. A Brookings’ study notes that high-value engineering and RD-intensive industries, such as automotive, are “the prime movers of regional and national prosperity.” That explains why so many state and local economic developers continue to focus on attracting auto investment.

When I first started working in the auto industry in the early 1980s, five companies – GM, Ford, Chrysler, American Motors, and Volkswagen – assembled vehicles in 21 states scattered throughout the nation. In addition to their traditional base in the Midwest (Michigan, Ohio, Indiana), the Detroit 3 operated plants on both coasts and in the South/Southwest. Over the next three decades, the Detroit 3 restructured, closing plants in several states, and consolidating most of their American manufacturing operations into their traditional Midwest base. At the same time, the Asian and European automakers started building cars in the traditional automotive states, such as Ohio and Indiana, and also in the Southern States, which saw a rapid growth in vehicle manufacturing.

The auto industry is alive and well in Automotive Alley, which has seen some $29 billion in new investment (in existing plants) since the Great Recession. While auto production is likely to remain centered in Auto Alley, the auto industry is also expanding west of Auto Alley, in an area dubbed the Auto West Corridor.

The auto industry is alive and well in Automotive Alley, which has seen some $29 billion in new investment (in existing plants) since the Great Recession. While auto production is likely to remain centered in Auto Alley, the auto industry is also expanding west of Auto Alley, in an area dubbed the Auto West Corridor.
The auto industry is alive and well in Automotive Alley, which has seen some $29 billion in new investment (in existing plants) since the Great Recession. While auto production is likely to remain centered in Auto Alley, the auto industry is also expanding west of Auto Alley, in an area dubbed the “Auto West Corridor”.

Auto Alley and the Auto West Corridor
After three decades of restructuring by the Detroit 3, and expansion by Asian and European automakers, most auto production in America is now consolidated in an area nicknamed “Auto Alley,” roughly defined as the corridor between I-65 and I-75, running from the Great Lakes to the Gulf Coast.

While auto production is likely to remain centered in Auto Alley, the auto industry is also expanding west of Auto Alley, in an area that I will dub the “Auto West Corridor.” This area is roughly bounded by I-55 in the east and I-35 in the west, extending from Illinois to Texas, and is home to 10 auto assembly plants. States in this corridor are well placed to compete for future automotive investment.
When GM and Ford consolidated most of their manufacturing in Auto Alley, they did not close their assembly plants in Illinois, Kansas, Missouri, and Texas. Since the Great Recession, these automakers have announced more than $3 billion in new investments in those plants, creating several thousand new jobs. A recent Brookings’ study notes that the Kansas City metro area, with large GM and Ford assembly plants, is now the second-largest auto-industry trading hub in North America, after the Detroit area.

Over the past decade, Toyota built two new assembly plants west of the I-65/I-75 corridor – in Tupelo, Mississippi, and San Antonio, Texas – and recently announced that it will create a new North American headquarters near Dallas that will employ 4,000 people. Nissan started up its Canton, Mississippi, plant in 2002, also west of the I-65/I-75 corridor, and is in the process of expanding the facility. Mitsubishi recently expanded production at its Normal, Illinois, plant, and Chrysler added a third shift as part of the $700 million expansion at its Belvidere, Illinois, plant.

Taken together, when the current expansions are completed, the six automakers will employ over 40,000 people in the corridor. This investment in new auto assembly capacity has been followed by new supplier investment in the region. Missouri, for example, has recently announced 10 supplier expansions and new plants, creating 1,000 jobs.

Rapid Expansion of Mexico’s Auto Industry
Another factor that may contribute to the future growth of the Auto West Corridor is its proximity to Mexico, which is emerging as a major automotive hub. Twenty years after the passage of NAFTA, Mexico has attracted significant new automotive investment. BMW and Mercedes are the latest of a string of automakers that have announced plans to build new assembly plants there.

As Mexico’s auto assembly has expanded, so has it auto parts sector. Delphi, which was formerly GM’s parts division, is one of several parts manufacturers that have shifted a significant portion of their North American production to Mexico from the U.S. Mexican parts content in American-built vehicles has increased fourfold since the enactment of NAFTA. On average, a vehicle made in the United State contains more than $4,000 worth of Mexican-made parts. For example, Ford’s Wayne, Michigan, assembly plant sources 27 percent of its parts from Mexico, and Volkswagen’s Chattanooga plant sources 15 percent of its parts from Mexico.

Proximity to Mexican parts suppliers could provide a logistical advantage for plants located in the Auto West Corridor, if the trend toward increased Mexican parts content continues.
Proximity to Mexican parts suppliers could provide a logistical advantage for plants located in the Auto West Corridor, if the trend toward increased Mexican parts content continues.

The rapid expansion of the Mexican automotive industry has raised alarm bells, especially in some of the Southern States, which haven’t seen a new greenfield assembly plant since Volkswagen announced its Chattanooga plant in 2008. Although some see Mexico’s burgeoning auto industry as a threat, it is an opportunity for others. The auto industry in North America is rapidly integrating, with vehicles and parts moving across the border in both directions. Proximity to Mexican parts suppliers could provide a logistical advantage for plants located in the Auto West Corridor, if the trend toward increased Mexican parts content continues. As illustrated in the table on page 16, assembly plants located in the southern part of the corridor are closer to Mexico than many of the assembly plants located in Auto Alley. Fewer miles from Mexico means lower transportation costs for Mexican parts, which are making up an increasing percentage of the content of American-made vehicles.
To be sure, the auto industry is alive and well in Automotive Alley, which has seen some $29 billion in new investment (in existing plants) since the Great Recession according to the Center for Automotive Research. But the recent new investment in the Auto West Corridor and its proximity to Mexico suggest that states in this corridor may be in a position to compete for the next new greenfield U.S. auto assembly plant.

The West Is Back In Play
Moving further west, northern California is an emerging hub of automotive activity, with the Tesla plant in Fremont, California, and the uptick in automotive activity in Silicon Valley.

Four decades ago, California was home to five auto assembly plants operated by the Detroit 3. After the NUMMI joint venture shuttered the last remaining auto assembly plant in California in 2010, most observers wrote off auto production in the state. But a newcomer, Tesla, has successfully started up operations at the former NUMMI plant, and now employs several thousand people there. Tesla builds electric vehicles and is looking for a site for a $5 billion “giga-factory” to make batteries, which it says will employ 6,500 people. As of this writing, Tesla has narrowed its search to five states, all located in the Southwest and West.

Silicon Valley has recently attracted significant auto-related investment, causing one tech blog to proclaim that the valley is becoming “the new Detroit.” As vehicles add more technology and software, the nine largest automakers and three largest global auto suppliers have set up offices and RD facilities in Silicon Valley. A company best known for its Internet search engine, Google, is making a significant investment in the auto industry as it develops self-driving, autonomous vehicles. It recently unveiled a prototype vehicle that it designed and built without a steering wheel, brake pedals, or an accelerator. A video of the vehicle, which can be found on YouTube, shows happy passengers going along for a ride in a driverless car. Some in the industry are speculating that Google may be the next new automaker. Among auto industry experts, opinions differ about when fully autonomous vehicles will be viable. IHS, a prominent auto industry forecasting firm, predicts 54 million autonomous vehicles will be on the road within 20 years — and that by 2050 nearly half of all vehicles will be self-driving.

Whatever the outcome, the development of the autonomous vehicle is yet another indication that the auto industry is in another, long-term disruptive phase, which will have implications on where vehicles are developed and built. New developments could lead to new opportunities. States and regions once considered “out of the mix” for new auto investment might find they are back in the game.

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A Hidden Value in The Hot Auto Industry


Everybody knows how the U.S. auto industry has rebounded robustly from its years of depression. Previously pariahs on Wall Street, shares of General Motors (GM) and Ford (F) are now tracking on the fast lane, speeding up to new high price levels. Their turnaround and that of the industry is now legend, but some industry players have yet to catch as much investor attention.  

One such company is Lear (LEA), one of the world’s largest suppliers of automotive components for vehicle manufacturers worldwide, whose stock has been on the rise during this bull market — but not as much as it deserves. Of late, more investors have discovered the stock after SP Capital IQ highlighted Lear as its “Focus of the Week” on Aug. 25. The stock was trading at $97 a share when SP published its highly bullish appraisal, but It has since gone up to $101, very close to its 52-week high of $101.71. 

But Lear’s stock has a lot more upside, according to Efraim Levy, analyst at SP Capital IQ, who recommends the stock as a “strong buy.” Lear has attractive total return potential, he points out. Levy predicts the stock will hit $130 a share in 12 months. “We expect Lear will  benefit from rising global vehicle demand, led by growth in the U.S., China, and improvement in Europe, while maintaining a supportive balance sheet,” says Levy. His forecast assumes the euro will stay at its recent levels.  

Levy figures Lear will generate revenues of about $17.8 billion in 2014 and $18.9 billion in 2015, up from last year’s $16.2 billion. The outlook for Lear’s earnings are also positive, says the analyst, who forecasts the company will earn $7.90 a share in 2014, supported by executed and projected stock repurchases, rising to $9.25 in 2015. The company earned $4.99 last year.

Lear is a Tier-1 supplier of seating and electric power management systems to global vehicle makers. The seating systems include seat frames, recline mechanisms, seat tracks and trim covers, headrests, and seat foam. The electric power system includes electrical distribution systems for traditional powertrain vehicles, as well as for hybrid and electric vehicles.

Lear’s biggest customers — General Motors, Ford, and BMW – accounted for 54% of revenues last year. Sales in North America accounted for 38% of 2013 revenues, with Europe and Africa providing 38%, Asia  18%, and South America 6%,

Lear’s recent agreement to purchase Eagle Ottawa, the world’s leading supplier of automotive leather, for $850 million, “offers multiple positives for Lear,” says Levy. The company expects immediate accretion of 5% to earnings per share in 2015, notes the analyst, “implying an increase of 46 cents a share applied to our $9.25 projection” for 2015. In addition, the deal would enhance Lear’s competitive position in the seating business and “synergistically enhance growth for Lear,” says Levy.

Brian A. Johnson, analyst at Barclays Capital Markets, upgraded his recommendation on Lear in August to “overweight” on the premise, he says, that Lear is a “hidden mega-trends” company with a “very attractive electrical power management business that is now coming into its own, outweighing secular pressures on its seating unit.” The strong second-quarter results at Lear were driven by both the seating and electrical segments, notes Johnson. He has a stock price target of $113 a share, reflecting his expectation of “stronger revenue growth in seating and better margin performance of the electrical segment.”

Johnson believes the stock should rise as further margin expansion is realized in Lear’s electrical unit which, he says, “positions Lear as a hidden ‘Connected Car’ company.” As such, he sees a possibly much higher valuation for the stock. He figures that by simply applying the average EBITDA-to-enterprise value multiple of auto suppliers to Lear’s 2015 estimated earnings before interest, taxes, depreciation and amortization, “implies a $140 stock.”     

Also a big bull on Lear is John Murphy, analyst at Bank of America Merrill Lynch, who has raised his price target to $115 a share from $110 after Lear posted its second-quarter results. He notes that the company has improved its balance sheet and cost structure over the past 5 years which, he says, should provide ample liquidity to fund Lear’s growth plans and to drive additional shareholder-friendly moves, including increasing dividends and share repurchases. At the same time, he expects margins to expand further as Lear’s electrical business contributes a larger percentage of revenues and profits.


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Productivity Commission recommends end to taxpayers’ support for local car …

A final report on the future of Australian car manufacturing has recommended federal and state governments give no further taxpayer support to carmakers.

The Productivity Commission report endorsed a Federal Government move to scrap the Automotive Transformation Scheme after Holden, Ford and Toyota end their manufacturing in Australia.

Holden and Toyota will end their local operations by 2017 and Ford is to end its local car making in late 2016.

The Federal Government has also been urged to consider removing a 5 per cent tariff on imported vehicles once the local carmakers close their operations.

The report also recommended a progressive relaxation of restrictions on imports of second-hand passenger and light commercial vehicles.

It said an easing of those restrictions should apply for vehicles from countries that have design standards consistent with those recognised in Australia.

The report said the imported vehicles should be under five years old and a specific $12,000 duty that applies should end as soon as possible.

The Federal Government said it would consider relaxing import restrictions on second-hand vehicles but would ensure Australia did not become a dumping ground for older cars.

Industry Minister Ian Macfarlane said the issue would be considered as part of the Government’s review of the Motor Vehicle Standards Act.

He said the Government would be mindful of any possible impact on the domestic retail market for cars and also would ensure continued high levels of consumer protection.

Ian Weber from the Federal Chamber of Automotive Industries said he feared letting second-hand imports into Australia would end up compromising the current high safety standards for used cars.

“Part of that’s driven by the safety of cars coming into this country that is regulated by our members who bring them in and our members are held to the highest standards,” he said.

“If we drop those standards by letting ‘grey’ imports in I think that would be an enormous mistake.”

‘Virtual closure’ facing local car industry

The Australian Industry Group, a not-for-profit business support organisation, said the Productivity Commission’s report seriously downplayed the impact the end of car making could have for Australia.

Chief executive Innes Willox said the end of local manufacturing was much more than the economic “adjustment” the report was claiming.

“The report fails to acknowledge that the situation facing the auto sector is not just another minor adjustment in the economy [but] represents the virtual closure of an entire industry,” he said.

“This will happen within a relatively short span of time and it will affect a large number of businesses, employees and communities.”

Mr Willox said the Productivity Commission seemed to be putting potential job losses at the optimistic end of the scale.

“The commission predicts that 40,000 people will lose their jobs. They assume that 80 per cent of workers in the direct auto assembly workforce plus 40 per cent of workers in the automotive components supply chain will be retrenched,” he said.

“This is considerably more optimistic than other estimates of future job losses.”

He said too the report had a disturbing lack of practical recommendations for an orderly transition of businesses out of supplying local auto makers.

“It is difficult to see how 60 per cent of Australia’s automotive components industry will be able to survive unaffected by the demise of local passenger car assembly, or be able to successfully transition into other opportunities,” he said.

South Australia’s Automotive Transformation Minister Susan Close dismissed the report as a 326-page obit to the car industry.

“Having conducted a post-mortem of the automotive industry, the Productivity Commission is now advising governments on how to dispose of the body,” she said.

She said many thousands of workers and businesses would be disappointed by the “cold-blooded” findings of the report.

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The dark age for the automotive industry in Argentina


Statistics have shown that during the last semester of 2014, the sales for new brand cars dropped by 23% while used ones decreased by 9%. This results were provided by the Automotive Commerce Chamber (CCA – Cámara del Comercio Automotor) and the Association for Automotive Dealerships (Acara – Asociación de Concesionarios de Automóviles).

The drops are alleged to be in relation to the local demand that is way too low against the supply from the companies which in many cases have started to increase their stock alarmingly and secondly due to a decrease in the exports from Brasil.

Real and great concern

Most companies have started to develop contingency plans that include from suspensions to dismissals. No company is safe from this situation and this raises a huge distress due to the fact that more than 20,000 employees have been layoff and this contributes to rise the unemployment rate.

General Motors: 2.700 workers will be suspended one day a week.

Peugeot-Citroën: In its facility located in Villa Bosch, Buenos Aires, the company decided to suspend one of its two shifts. 1,000 workers were affected by this resolution.

Volkswagen: a decision was made to halt the Friday production from the Pacheco facility (Buenos Aires) since May. This company has stated that they have in stock more than 15,000. cars with no prospect of being sale. For that same reason, in addition to the previous measure, they have also decided to design a plan for volunteer retirement.

Scania: a company known for producing trucks and buses have also suspended its 400 workers from the facility located in Tucumán.

Renault: In its facility located in Córdoba, the company had to suspend nearly 600 employees.

Fiat: Since the beginning of the year this Company has suspended 2,100 workers from its facility located in Córdoba.

Iveco: In Ferreyra, a local town in Córdoba, Iveco decided to suspend 80% of its workers for 2 months.

One previous gear of this circuit

The autopart company called Montich has also been applying suspensions to its personnel. Its CEO, Ramón Ramirez, has acknowledged the crisis that is hitting the industry and has decided that Montich will start coping with the situation by reducing salaries and possibly a few dismissals.

Montich has a permanent plant of 490 employees and three facilities, in Córdoba, Buenos Aires and Brasil.

Its main customers are Renault, Fiat and Iveco, all companies going through the same crisis.

The crisis within this specific sector of the industry has a great impact on the companies previously mentioned. Official sources stated that between 2,000 and 2,500 employees were suspended and some auto parts companies have given their workers early licenses.

Auto dealerships

Due to the lack of activity and sales, many auto dealerships were obliged to close. High real estate costs, high maintenance costs and the obligation to support salesman and it salaries were between the main factors that turned this decision.

During the first four months of the year, 272,095 cars were registered which can be translated as a drop of 18%.

There is always someone to blame but oneself

Going back to the reasons given at the beginning of this article, let me say something more about the argentinean auto exports.

With the way the argentinean government is used to treat its fellow partners, Axel Kicillof, the minister of economy requested that the brazilian government should proposed a plan in which Brazil would increase their imports so that the deficit that hits the Argentinean economy (U.S. $3.100 million) would decrease and hopefully get to an equilibrium.

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Kicillof heads to Brazil for talks on automotive industry

Economy minister Axel Kicillof left Buenos Aires today to travel to Brazil, where he will meet with fellow ministers from the country to discuss the current situation of bilateral trade and the automotive industry.

Kicillof is expected to meet with Brazil’s Economy minister, Guido Mantega, and Industry minister Mauro Borges in order to analyse the trade situation between the South American neighbours, according to government sources.

Falling trade in automobiles, which prompted Brazil and Argentina to sign a new commercial pact in June, will also be discussed between Kicillof and his Brazilian counterpart.

The drop in new car sales in the internal market, as well as the contraction of export sales, have affected vehicles manufacturers and sellers located in Argentina. Union estimates claim that up to 170,000 workers have been affected by the decreasing activity in the industry.

Lower demand from Brazil, which purchases around 90 percent of Argentine vehicle exports, has also hit the industry hard. In July the sector sent 24,085 units abroad to various markets, 38.7 percent lower than the 39,289 exported during the same month.

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BMW has the biggest Facebook page in the automotive industry

According to social media statistics, BMW has the biggest Facebook page in the automotive industry. Same statistics point out that the success of the BMW’s Facebook page can be directly linked to how BMW encourages its fans to post pictures and share driving experiences across social media.

In return, the users receive exclusive news and information, sometimes used also as news sources by online magazines. For BMW, social media has been a playground where experiments were allowed until the right formula was found. BMW launched campaigns such as its “0 to Desir3” YouTube video contest, in which BMW encouraged its fans to submit 5.9 second videos expressing how much they want a BMW 328i sedan.

BMW has the biggest Facebook page in the automotive industry

BMW currently has over 18 million fans on Facebook.

In 2013, social media analytics tools show that 38 percent of consumers would consult social media channels before their next car purchase.

Millennials are without a doubt the most engaged demographic on social media and are the most active and willing to share content.

A recent survey carried out by Inside Facebook highlighted that 81 percent of millennials are active on Facebook with a median amount of 250 friends, statistics that far exceed those of other generations.

The automotive industry has begun to fully embrace social media. From automakers to car shows and automotive vendors, everyone sees the potential to not only connect with their fans but also drive sales.

By engaging with Facebook and other online networks, the car companies can publicize, for free for the most part, their products. The companies also look at the millennials as the next generation young professionals and future clients, so long-term relationships are needed to build trust and loyalty.

BMWBLOG has also been successful to engage with BMW fans through our own social media channels: Facebook, Twitter, Instagram and Youtube.

[Source: Bizjournal]

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22 Auto Industry Stocks to Consider for Your Stock Portfolio

NEW YORK (TheStreet) — With so many different investments options, investors often have a difficult time deciding which direction is the best one for them to take.

TheStreet is attempting to declutter the plethora of information available and present it to our readers in a way so that they can make wise investment decisions. Whether you’re an individual investor or work with a financial advisor, the objective is to help simplify the process and present information that’s user friendly.

The automotive industry is one of the largest consumer industries in the world. It amassed 85.4 billion automobiles sold in 2013, according to the International Organization of Vehicle Manufacturers.

Despite the recent success, the automotive industry has proved to be sensitive to global economic volatility. For example, the industry was hit hard domestically from 2006-2010, when net profit in the new-vehicle department was negative each year.

The overall industry is comprised of numerous different segments, including auto manufactures, interiors, powertrain systems, body structures, tire and diversified manufacturers. In fact, the industry as a whole is forecast to accrue a total value of $1.7 trillion and reach volume of 168.2 million units, a 39.6% increase since 2010, according to a report by

The purchase of a car is often attributed as one of the more unfavorable financial investments a consumer can make, but investing in the right automotive stock can prove to be very favorable.

What follows are twenty-two automotive industry stocks with descriptions from SP, ranked by our own proprietary quantitative ranking system at, which are worth looking over. Note that these ratings can change at any time. If you would like access to real-time ratings of these stocks, you can subscribe to TheStreet Quant Ratings. Buckle up.

22. Tesla Motors (TSLA)
Segment: Auto Manufacturers

Tesla Motors designs, develops, manufactures, and sells electric vehicles and electric vehicle powertrain components.

The company also provides services for the development of electric powertrain systems and components, and sells electric vehicle powertrain components to other automotive manufacturers. It markets and sells its vehicles through Tesla stores and galleries, as well as over the Internet.

The company operates a network of 80 stores and galleries in North America, Europe and Asia.

Tesla Motors was founded in 2003 and is headquartered in Palo Alto, Calif.

Free Report: Jim Cramer’s Best Stocks for 2014

TheStreet Ratings team rates TESLA MOTORS INC as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:

“We rate TESLA MOTORS INC (TSLA) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company’s strengths can be seen in multiple areas, such as its robust revenue growth, solid stock price performance and notable return on equity. However, as a counter to these strengths, we also find weaknesses including unimpressive growth in net income, generally higher debt management risk and poor profit margins.”

You can view the full analysis from the report here: TSLA Ratings Report

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