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+++ The BMW Group achieved its best ever sales in 2016, the sixth year in a row the company has set a new sales record, maintaining its position as the world’s leading premium car company with its 3 brands, BMW, Mini and Rolls-Royce. Having recorded steady sales growth throughout the year, a total of 2,367,603 BMW Group vehicles were sold around the world in 2016, an increase of 5.3% compared with the previous year. “As our model line-up has expanded, so have our sales, making 2016 our most successful year ever”, commented Ian Robertson, Member of the BMW Board of Management with responsibility for Sales and Marketing, speaking at the North America International Motor Show in Detroit. “Despite headwinds in some markets, our policy of balanced global sales has paid off, as we increased our worldwide sales month by month”, he continued. “The sales development of our electrified vehicles has been particularly positive, with more than 62,000 delivered in 2016. I am confident we can continue this momentum and build on our course of profitable, sustainable growth into 2017”, he added. In 2016, the BMW brand achieved a new full-year sales record of more than 2 million vehicles. A total of 2,003,359 BMW brand vehicles were sold around the world, 5.2% more than in the previous year. The worldwide trend towards increasing SUV sales was reflected by the continuing success of the X family, with one in three BMWs sold being an X vehicle. A total of 644,992 BMW X models was delivered in 2016, an increase of 22.3% compared with 2015. Other notable growth drivers for the brand include the 2 Series (196,183 / +24.8%) and the brand’s flagship 7 Series, which saw sales increase by 69.2% to total 61,514. The new 5 Series, which will be launched in February, is expected to contribute significantly to sales growth in 2017. Full-year sales of BMW electrified vehicles topped 62,000 in 2016, with the figures growing strongly through the year as more models were added to the line-up. The BMW Group now offers a total of 7 electrified vehicles, the broadest range of any manufacturer. “The addition of new models has clearly driven our sales of these innovative vehicles and we were delighted to see the 100,000th electrified BMW hit the road in November 2016”, commented Robertson. “2016 also underlined that electro-mobility grows fastest in markets which actively support the uptake of the technology by offering the right blend of both customer incentives and public charging infrastructure”, he added. With the addition of the 5 Series and the Mini Countryman plug-in hybrids in the coming months, the BMW Group will have 9 electrified vehicles in its portfolio and is targeting electrified sales of 100,000 units in 2017. +++

+++ FIAT CHRYSLER Automobiles was accused of violating pollution laws with 104,000 diesel vehicles, sending the shares plunging on the prospect the automaker may follow Volkswagen in facing billions of dollars in fines. The Environmental Protection Agency alleged Fiat Chrysler put software in Jeep Grand Cherokee and Ram 1500 models that allows them to exceed pollution limits. The EPA stopped short of calling the software a “defeat device” but said the carmaker failed to disclose their use. Fiat Chrysler said it meets all applicable regulatory requirements and will work with President-elect Donald Trump’s administration to contest the allegations. Fiat Chrysler becomes the second automaker in less than 3 years the EPA has accused of violating the law by using software to pass laboratory emissions tests. Volkswagen, which admitted to using defeat devices in September 2015, agreed to pay a $4.3 billion fine, boosting the cost of the scandal to about 20.5 billion euros ($21.9 billion). Fiat Chrysler’s case is “completely different” from Volkswagen’s, Chief Executive Officer Sergio Marchionne said in a call with reporters. He called the timing of the EPA’s notice of a violation “very strange” and said the Italian-American automaker rescued by the Obama administration in 2009 had discussed emissions with the EPA for more than a year. “I am really ticked off”, Marchionne said. Fiat Chrysler’s alleged violations could result in fines of as much as $44,539 per vehicle, Cynthia Giles, the EPA’s enforcement chief, said. The total potential penalty could be as much as $4.6 billion, based on the cost per vehicle and the number of 2014 through 2016 model year SUVs and pick-ups. When the EPA first revealed Volkswagen’s wrongdoing in September 2015, the company faced punishment of up to $18 billion. “Our meetings with Fiat Chrysler to date have not produced a viable explanation” for the software, Giles said during a conference call the EPA hosted with reporters. “This is a clear violation of the Clean Air Act”. New York Attorney General Eric Schneiderman said his office will investigate the EPA’s claims against Fiat Chrysler, saying in a statement he was “deeply troubled” and would work with state and federal partners. Fiat Chrysler plans to work with the Trump administration to “present its case and resolve this matter fairly and equitably”, the automaker said in a statement. The EPA says it discovered Fiat Chrysler’s allegedly illegal software while conducting enhanced testing of other diesel vehicles in the wake of Volkswagen’s scandal. The agency said it’s now up to Fiat Chrysler to demonstrate the software was not a defeat device. “Chrysler’s alleged misbehavior — rigging its trucks, VW-like, to increase pollution of our lungs and lying about it — is appalling”, Dan Becker, director of the Safe Climate Campaign, said in an e-mailed statement. The EPA’s violation notice said Fiat Chrysler’s diesel engine system had eight control devices changing the emissions of the vehicles under certain conditions that the company didn’t disclose. Not all such systems are cheat devices like Volkswagen used, according to John German, senior fellow at the International Council on Clean Transportation, a Washington-based non-profit that conducts technical and scientific analysis. ICCT played a central role in exposing Volkswagen’s cheat devices. The government allows control devices, but they can’t be used to change emissions to meet testing requirements and they must be disclosed, German said. “The EPA is still investigating whether these are cheat devices”, he said in a phone interview. “VW got hit hard because they lied, covered it up and didn’t have a fix”. Marchionne said he presumes the U.S. Justice Department also is investigating the company. Fiat Chrysler’s software wasn’t used to bypass emissions tests or operate differently during evaluations than in real-world use, he said, calling such allegations “absolute nonsense”. “This software doesn’t look for anything”, he said. “It just runs”. +++

+++ FORD is gearing up to resharpen its Focus when the new version of the Volkswagen Golf and Opel Astra-rivalling family car hits showrooms in 2018. The current third generation of the Focus has faced ever-tougher competition during its lifetime – not just from the likes of its age-old rival, the Astra, which has shed weight to rediscover a handling sweetness it has lacked for years, but also from the boom of ‘lifestyle’ vehicles, like baby SUVs and larger crossovers. The Mk3 Focus moved away from the ultra-crisp handling of its predecessors because it was, at least in part, a global model designed and engineered as part of the ‘One Ford’ program, catering to all needs. The new model will be sold globally, too, but Ford appears to be prioritising European tastes in its development. In a key move that shows the importance being placed on the new generation, Darren Palmer has been put in charge of the project. The Briton is rated highly within Ford for his work on the recently revealed Mk7 Fiesta and the cheaper, Indian-built Ka+ that sits just below it in the range. Under the skin, the Focus is likely to retain the existing version’s Global C-car platform. However, Palmer’s team will have been given a brief to make sure the set-up retains suspension comfort, while rediscovering more of the handling agility that made the Mk1 and Mk2 cars so popular. Ford is likely to increase its wheelbase very slightly in a bid to improve interior packaging, especially for rear-seat occupants. As such, Palmer and his engineers will turn to elements like the power-steering set-up, the front suspension geometry and tricks like stiffer rear suspension bushes in a bid to increase handling verve. At the same time, expect greater use of high-tensile steel in the car’s construction, to help it lose a few kilos. Significantly, the Focus range will be split into the same ‘differentiators’ as the new Fiesta line-up. Cheaper editions could be dropped altogether – a reflection of the fact that the Fiesta range now extends to higher price points than before. The remaining models will include the sport-focused ST-Line and the more luxurious Vignale, which also brings perks on the customer service side. There will also be an Active version of the car, giving Ford a competitor for the Volkswagen Golf Alltrack. The Focus Active will feature slightly raised ride height and additional body cladding, in the same fashion as the Fiesta. Ford Europe boss Jim Farley told: “The Fiesta is going to be step one, but I think we’ll continue to look at these Active editions”. Unlike the Fiesta variant, the Focus Active could be offered with four-wheel drive, although it will be front-wheel drive by default. Inside, expect the same rationalisation of the dashboard layout as we’ve seen in the new Fiesta, with fewer buttons and many features controlled through an eight-inch touchscreen. This display could well be offered as the minimum on all versions of the car, with some higher-end editions getting an even bigger set-up. The engine line-up will be based on Ford’s 1.0-litre turbocharged three-cylinder petrol engine, the EcoBoost. Expect at least three different power outputs to be offered, starting at 100 hp and moving up to 125 hp and 140 hp. Depending on how successful engineers are with the Focus’s diet, it’s possible Ford could also offer an entry-level edition with the highest-output version of its new three-cylinder non-turbo engine, producing 85 hp. The most popular diesel options will be a 1.5-litre with 85 hp or 120 hp, although Ford is still likely to offer the car with a high-output 2.0-litre TDCi. The new Focus is also all but certain to be one of the 13 electrified cars that Ford CEO and president Mark Fields has promised before the end of the decade. The Global C-car platform was engineered with hybrid and pure-electric uses in mind, and progress in battery technology could well mean Ford offers both of those solutions, instead of the current car’s single Electric Vehicle edition. This would give the Focus range appeal against the latest Volkswagen e-Golf and the ever-expanding line-up of hybrid family cars, such as the Hyundai Ioniq and Kia Niro. +++

+++ HOLDEN has announced October 20, 2017 as the date it will shut the doors of its Elizabeth car plant outside of Adelaide for the final time, and become a full-line vehicle importer. Holden has assembled vehicles for domestic and export markets at Elizabeth since 1963. Nearly 1.000 employees will remain in production, engineering and support roles until production ends. GM says there are no plans for any further workforce reductions ahead of October 20. Holden also says that, of the nearly 700 people who have left Holden’s Elizabeth plant since 2015, 80 percent have “successfully transitioned” within 12 months of leaving (69 percent employed, 5 percent in training, 3 percent have retired and 3 percent are volunteering). The timing means GM Holden lives up to the promise it made in 2013 that it would make cars until the final quarter of this year. The Lion brand says it will make more than 30,000 Commodore, Caprice and Ute vehicles before the shut down. Naturally, there will be strong demand for final edition Commodore and Ute models, which will be the last of their kind. Special edition models will also be made available before the end. Holden ceased Cruze small car production late last year. Commodore and Ute sales still made up about one-third of Holden’s volumes in 2016, and the imported Opel-based front- and all-wheel drive replacement due next year will be hard-pressed to get close to those volumes. Holden chairman and managing director Mark Bernhard said Holden’s manufacturing workforce had “set new benchmarks for quality and performance in the past 4 years”. “They have continually pushed to improve the quality of their work for the benefit of our customers – this commitment, continuous improvement attitude and passion have been exhibited in spades in challenging circumstances”, Bernhard said. “It’s not surprising that their skills, work ethic and flexibility are highly sought after and they are leaving a legacy for Holden that deserves to be honoured by ensuring this company has a bright and successful future. Holden continues to change but we are proud to retain a significant presence in Australia for the long-term that includes more than 300 people across our local design and engineering workforces, in addition to the approximately 700 corporate staff and 10,000 people employed across our 230-site dealer network. Holden remains committed to Australia and our customers for many, many years to come”, he added. We would add that the 10,000 staff in Holden’s dealer network are largely employed by its franchise partners rather than directly. Holden says it will launch 24 major vehicles and 36 new drivetrain combinations by the end of 2020. Holden vehicles also continue to be tuned and tested for Australian conditions at the Lang Lang Proving Ground in Victoria. Holden’s Global Design centre also continues to be based in Port Melbourne, contributing to local and global product programs, especially by designing and fabricating concept cars. Ex-Holden design boss Mike Simcoe was appointed GM’s global design boss, a massive coup, in April last year. All Holden employees leaving the business have access to transition services and up to $3000 in approved training and $500 for financial advice. Holden has spent $15 million helping a federal government-led Growth Fund for local car workers. Holden’s confirmed closure only leaves questions surrounding Toyota’s imminent departure. Tony Cramb, executive director of sales and marketing for Toyota told no firm date was in place. Yet. “We haven’t announced a date for the end of production yet”, Cramb said. “We’re in the process of finalising the date – we’ll be looking at the volumes and sales volumes for 2017, and we’ll be announcing within the first quarter. By the end of March, you’ll know when local manufacturing will be complete”. Toyota’s public relations manager, Steve Coughlan, added Toyota employees will be informed of the closure date ahead of the public announcement. +++

+++ It appears Japanese premium marque LEXUS is expanding its SUV range, with the production version of the striking UX concept and a 7-seat version of the popular RX in the works. The company has already filed patents for UX model names (including UX200, UX250 and UX250h) which is set to replace the ageing CT hatch. It is expected the UX’s styling in production form to be less extreme than the concept, though aspects like the front grille and angular styling will be adapted to the final product. Going by the model names that are in the patent process, expect a mix of petrol and petrol-electric hybrid powertrains to be offered as well. The production version of the UX is expected to debut sometime later this year or early in 2018. Meanwhile, Lexus is also planning a 3-row version of the RX, set to take on the likes of the Volvo XC90 and Range Rover Sport when it makes its debut likely later this year. It’s believed the new model will be offered in both RX350L and RX450hL trims (in line with the regular version minus the turbocharged 200t variant) and will go on sale (in Europe at least) in 2018. Toyota boss Karl Schlicht said: “We would see other SUV developments before we’d see another coupe – that’s my guess”. “Once the coupes have done their job, we need to further refine the SUV range”, he added. +++

+++ MAZDA chalked up its fourth-straight year of double-digit growth in Europe, where it sold almost 240,000 vehicles in 2016, a 12% increase over the 2015 calendar year. That was around twice the overall market growth rate of some 6%, earning the Japanese carmaker a 1.5% market share. The company’s SUVs remained customer favourites: The CX-5 was again the most popular model in the region followed by the smaller CX-3; together the two made up almost half of European turnover. Sales of the CX-3 and MX-5 more than doubled last year relative to 2015. Portugal posted the highest growth in 2016 among the national markets, with an 80% year-on-year upsurge, while sales in Italy rose 53%. Ireland, meanwhile, recorded a 35% hike thanks to demand for the Mazda3 and Mazda6, and Belgium a 26% increase distributed across the product range. Elsewhere, growth was around or above 20% in the Czech Republic, Finland, France, Hungary, Poland, Slovenia, Spain and Sweden. Germany recorded an almost 9% increase, and the UK a 2.4% rise, outpacing the markets in both instances. “When I contemplate four consecutive years of strong growth, I think above all of the CX-5. This was the vehicle that kicked off the current generation of award-winning Mazdas featuring SkyActiv Technology and Kodo designs. It soon became our number-one seller, and still is despite being the oldest model generation in our line-up”, says Martijn ten Brink, vice president sales & customer service at Mazda Motor Europe. “So we’re optimistic about 2017 and the upcoming launch of the all-new CX-5. Several model upgrades are also in the pipeline”. Mazda began the European rollout of the 2017 Mazda6 and 2017 Mazda3 in fall, and the new Mazda MX-5 RF will arrive shortly. Most new models and upgrades feature standard G-Vectoring Control (GVC), a new system developed in-house at Mazda. GVC dynamically optimises wheel load and with it road grip for smoother g-force transitions, which translate into added comfort and less fatigue as well as better handling and a safer journey. The technology aims to evolve the Jinba-Ittai nature of Mazda models, where the car behaves like an extension of the driver, to embrace all occupants. +++

+++ French prosecutors are investigating RENAULT over suspected cheating on vehicle exhaust emissions, a source at the Paris prosecutor’s office told. The probe follows the Volkswagen diesel emissions scandal, which emerged in September 2015. VW this week agreed to pay $4.3 billion in a settlement with U.S. regulators and the U.S. Environmental Protection Agency accused Fiat Chrysler of also using software to conceal excess diesel emissions. Fiat Chrysler Chief Executive Sergio Marchionne rejected the allegations, saying there was no wrongdoing and the company never attempted to create software to cheat emissions rules by detecting when the vehicle was in test mode. Three judges have been looking into the Renault matter, the source said. Whether the prosecutor’s inquiry is followed by a trial is for the judges to decide. They are focused on the public health implications of Renault’s actions, the source told. Renault said it respected all laws concerning exhaust emissions and added that its vehicles did not have software allowing it to commit fraud in this area. The opening of the judicial probe comes 2 months after the government passed findings of an investigation by consumer fraud agency DGCCRF to the prosecutor’s office. +++

+++ Senior VOLKSWAGEN managers have been warned not to travel to the United States, legal and company sources told, after 6 current and former managers were indicted for their role in the German carmaker’s diesel test-cheating scheme. One of the six charged, Oliver Schmidt, was arrested at Miami International Airport on Saturday as he was about to fly home from holiday in Cuba. Schmidt, who is caught up in the “Dieselgate” investigation by the U.S. Department of Justice (DoJ), was ordered to be charged and held without bail pending trial. Under the constitution, German citizens can be extradited only to other European Union countries or to an international court. But leaving Germany at all could pose a risk of being extradited to the United States from a third country. “Several Volkswagen managers have been advised not to travel to the United States”, one legal adviser to Volkswagen said on condition of anonymity because the matter is confidential. A second legal adviser said this also applied to managers who had not yet been charged with any offense in the United States. “One doesn’t need to test the limits”, the adviser said. Schmidt was among those who had been warned by lawyers working for the company not to travel to the United States, one of the legal sources said. Volkswagen declined to comment. The company agreed to pay $4.3 billion in civil and criminal fines in a settlement with the DoJ, the largest ever U.S. penalty levied on an automaker. However, Attorney General Loretta Lynch said the DoJ would continue to pursue “the individuals responsible for orchestrating this damaging conspiracy”. The German Federal Criminal Police Office said it was not aware of any request to extradite the other 5 indicted VW managers, while the Justice Ministry said it could not comment on individual cases. Interpol said it did not comment on specific cases or individuals except in special circumstances and with approval of the member country concerned. Given the risk of extradition from a third country, a reluctance to let senior managers leave Germany at all could pose considerable difficulties for Europe’s biggest carmaker, which employs more than 600,000 people worldwide and sells 88 percent of its vehicles outside its home country. Only one board member traveled to this week’s auto show in Detroit: VW passenger car brand chief Herbert Diess, who joined Volkswagen in July 2015, just two-and-a-half months before the VW’s decade-long deception of U.S. authorities became public. A senior manager at the VW brand who asked not to be named called Diess’s decision to travel to Detroit “bold” and said his peers had been given guidance not to leave Germany as the risk of impending U.S. charges rose – although he would not go so far as to call it a “travel warning”. He said colleagues knew after being questioned by Jones Day lawyers, who are carrying out an independent internal investigation into the emissions affair, whether they had something to fear in the United States, and may have used this to determine travel plans. Charles Kuhn, a partner at criminal law firm Hickman & Rose, said people in such a position faced “a harsh choice – voluntarily hand themselves in, or never leave Germany without fear that an international arrest warrant will land them in US custody anyway”. “It’s the kind of impossible decision that leaves people holed up in embassies for years”, he said. “It depends on the alleged offense, but it is sometimes better to face the music than to live in the shadow of the DoJ”. +++

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