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May was apparently a tough month for Ford's big SUVs. With consumer demand understandably cold for the gargantuan utes and their hard-to-swallow 12 mpg city ratings, Lincoln Navigator sales slid 37 percent while Ford Expedition sales were down 43 percent. As a result, Ford Motor Company has announced that its Wayne, Michigan, plant that assembles these vehicles will close down for nine weeks starting on Monday. While the plant sits idle, Ford will increase production of its passenger cars to better meet market demand for smaller and much more fuel efficient vehicles. Like we didn't see this coming...

[Source: Automotive News, subs. req'd]

The strike last week by the International Brotherhood of Teamsters (IBT) against Performance Transportation Services (PTS) was the straw that broke the camel's back. The second largest car hauler in the United States was unable to survive the wage-related dispute, especially after filing for bankruptcy protection in 2006 and 2007. On Friday, PTS announced that it's stopping all operations and going out of business.

The effect on the industry overall will be minor. Automakers began rescheduled their deliveries last week when the strike was announced. As domestic vehicle production has slowed, excess transport capacity has been able to take up the slack and no major interruptions have been seen. It seems the striking workers have also been accommodated as the Teamsters are reporting that the "vast majority" of their 1,250 drivers have found work at other unionized locations. Still, any organized union thinking of striking in this economic climate should consider the possibility that such a move may result in pink slips for everyone.

[Source: Automotive News, subs. req'd]

The AP got a hold of an internal email sent to all Chrysler employees informing them in no uncertain terms that they will be taking a vacation from July 7 through July 21. While some kind of plant shutdown is apparently common for most automakers during the summer, this corporate-wide stoppage will also include salaried employees, with the exception of a few teams that will stick around to work on special projects. A Chrysler spokesperson didn't divulge any hard details about the reason for the temporary shutdown, other to say that it should help "boost productivity and efficiency."

[Source: AP]

The 10-day strike between American Axle & Manufacturing Holdings Inc. and the United Auto Workers union is now threatening to idle or partially shut down 13 more GM plants as early as Monday. Although talks are underway again, even a resolution over the weekend may mean closures as it takes time to deliver inventory and ramp up production. As of now, seven assembly plants at GM have already been idled after the AA workers walked off their jobs on February 26th.

American Axle supplies components to many different automakers, meaning the strike is being felt industry-wide. The strike is hitting GM particularly hard, however, as it does represent some 80% of the supplier's business. GM idled four truck plants within days. By yesterday, five GM plants, and seven suppliers were down. Chrysler may also have to idle plants in Delaware and Mexico by mid-next week if both sides don't come to an agreement.

There is light at the end of the tunnel. Reportedly, both sides already agree on the principles of a concession, leaving just the issue of hourly wages on the table. And, as most negotiation experts point out, money differences are often the easiest to solve.

[Source: Detroit News, Photo by Bill Pugliano/Getty]

That Porsche owns a significant stake in the Volkswagen group (and all its subsidiaries) is no secret. In fact, Porsche is even in the process of increasing its stake. Oddly, though, little seemed to be done to minimize the competition presented to Porsche products by those of VW divisions: Lamborghini Gallardo vs. Porsche 911 Turbo, Audi TT vs. Porsche Boxster and Cayman, Audi Q7 vs. Porsche Cayenne, etc. But now Porsche is reportedly taking aim at an easy target: Bugatti.

Truth be told, it's really Bugatti's lack of profitability that Porsche is targeting. Porsche remains one of the only sportscar manufacturers that generates profit (copious amounts of it, actually), while Bugatti loses VW money continuously. The development costs of the super-expensive Veyron were to be offset by the application of technology towards future Bugatti vehicles (like a new saloon or four-door coupe), but if Porsche gets its way, a new Bugatti will never see the light of day, with Stuttgart evidently preferring to cut their loses (and a competing supercar maker).

Volkswagen would be unlikely to find a buyer for Bugatti even if Porsche applied enough pressure for them to sell. Stuttgart's proposal, then, would be to turn the exclusive marque even more exclusive, as a coachbuilder, creating unique one-off vehicles (like Jim Glickenhaus' Ferrari P4/5 by Pininfarina) for over $4 million a piece. And here we thought the existing Veyron was expensive....

[Source: Car magazine via Motor Authority]

In anticipation of its upcoming 2007 models arriving, Nissan has decided to swallow a hard pill and shut down production at its three U.S. plants for six days by the end of July. Scuttling its plants in Canton, MS and Smyrna and Decherd, TN will trim 18,000 vehicles from its previously planned production schedule.

The first shut down day occurred on April 17, the second will be May 26th and lengthen the plant’s Memorial Day weekend, while the final four will give workers a very large Fourth of July weekend. All six days will be treated as vacation days for employees, which we assume means they’ll still be on the clock.

Additional down days could be added if sales slow even further ahead of the ’07 arrivals, which include the Versa Hatchback and Sedan, Sentra, Quest, Altima and Altima Hybrid, and Infinit G35 Sedan.

[Source: Nissan]

Idling seven factories will push Ford's restructuring costs up to a total of $3.4 billion (before taxes) for the year. The figure includes over $2.1 billion associated with early retirement packages, layoffs, and pension issues, as well as $280 million to close the plants.

The factories on the block so far are the two the automaker announced last week -- St. Paul, Minn. and Norfolk, Va. -- as well as the Wixom, Mich., and Atlanta, Ga. Production at St. Thomas will be cut to one shift.

[Source: The Detroit News]