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Top 5 Stories
AP Survey: Outlook for 2011 Economy is Brightening
Ford 'Money Machine' May Report Most Profitable Year Since 2000
Volvo to Slash U.S. Line-Up in Bid to Reverse Sagging Sales
U.S. Sees Quicker Exit From GM
Hyundai Motor Profit Rises to Record on Higher Demand in China, U.S.
Top 5 Stories
AP Survey: Outlook for 2011 Economy is Brightening

WASHINGTON — Employers will hire more workers this year, and the economy will grow faster than envisioned three months ago, according to an Associated Press survey that found growing optimism among leading economists. Among the reasons for the economists' growing optimism: an extension of income-tax cuts, a cut in Social Security taxes for workers, easier access to loans, higher stock prices and a government that seems more sympathetic to the priorities of businesses. In the spring and summer, many analysts had feared the economy might slide back into a "double-dip" recession. "Consumers and businesses are in a better mood," said Nariman Behravesh, chief economist at IHS Global Insight. "They are spending a little more freely. Not a lot more freely, but a little more freely."
Source: The Associated Press

Editor's note: Nariman Behravesh will address the U.S. economy and auto industry in "The Road Ahead for New Automotive World - Risk, Reward and Opportunity" at the NADA/IHS Global Insight Auto Forum on April 19 in New York. For more on the forum, visit www.AutoForumNY.com.

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Ford 'Money Machine' May Report Most Profitable Year Since 2000

Ford Motor Co., the second-largest U.S. automaker, may report its most profitable year since 2000 tomorrow, boosted by new models and a better reputation. The annual profit would be the second straight for Chief Executive Officer Alan Mulally, who has improved quality and expanded the model lineup. Profit excluding some items for 2010, according to the average of 15 analysts’ estimates, may be $2.08 a share, the highest since $4.36 a share in 2000. Fourth-quarter profit may be 48 cents, the average of 14 estimates. “Ford is building better cars, they’re more fuel-efficient and they’ve really focused on quality since Alan Mulally came in,” said Gary Bradshaw, a fund manager at Dallas-based Hodges Capital Management, which owns 100,000 Ford common shares and 100,000 preferred shares. “He’s just making this company a money machine.”
Source: Bloomberg

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Volvo to Slash U.S. Line-Up in Bid to Reverse Sagging Sales

Volvo Cars, the Swedish carmaker owned by Zhejiang Geely Holding Group Co. of China, will slash the number of models it offers in the U.S. to focus on its best- selling vehicles in a bid to reverse years of declining sales. “Five or six is probably a good number,” said Doug Speck, head of Volvo’s operations in the U.S., in a telephone interview yesterday, noting that Volvo currently offers nine models there. “We have to focus on the key segments with significant volume potential.” Kjell Bergh, who owns two Volvo dealerships in Minneapolis, Minnesota, said Volvo has suffered from its lack of fuel- efficient cars in the U.S. “The very seriously lacking element in the United States is that we have exactly zero green products -- no diesel, no hybrids, nothing,” Bergh said by phone. “That’s a major error because Volvo’s customers historically have been by far the most green-oriented clientele in America. They have migrated to other brands for lack of choice.”
Source: Bloomberg

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U.S. Sees Quicker Exit From GM

DETROIT — The U.S. Treasury could sell its remaining stake in General Motors Co. within the next year, an Obama administration official said Wednesday, signaling a much shorter time frame than the auto maker initially expected. A sale of the U.S. government's remaining stake in the auto maker is "realistic" within the next 12 months, the official said. Under terms of the IPO, the government can't sell additional shares until mid-May. But the auto maker and its stock underwriters have been pushing the Treasury to sell most or all of its remaining stake this year, rather than off-loading shares gradually over the next few years. The Treasury needs to sell its remaining GM shares at an average price of $53 each to break even on the bailout.
Source: The Wall Street Journal 

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Hyundai Motor Profit Rises to Record on Higher Demand in China, U.S.

Hyundai Motor Co., South Korea’s largest automaker, posted a 48 percent increase in fourth- quarter profit as the company boosted sales in the U.S. and China amid rising global auto demand. Net income increased to a record 1.4 trillion won ($1.3 billion) in the three months ended Dec. 31 from 945.5 billion won a year earlier, the Seoul-based carmaker said today in a regulatory filing. The Korean company’s U.S. sales jumped 38 percent from a year earlier to 128,181 vehicles in the quarter, while its deliveries climbed 22 percent in China and 6.5 percent in Europe. "Hyundai’s brand value and quality have improved with the launch of various new models,” Chang In Whan, president of KTB Asset Management in Seoul, said before the announcement.
Source: Bloomberg

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Quotable
 
"Consumers and businesses are in a better mood. They are spending a little more freely. Not a lot more freely, but a little more freely."

    — Nariman Behravesh, chief economist at IHS Global Insight, who lifted his forecast for economic growth in 2011 to 3.2 percent, from 2.2 percent in October, The Associated Press, Jan. 27



"The road is getting a little narrower for Ford because there’s more healthy competition coming on the freeway."

    — Efraim Levy, an auto analyst with Standard & Poor’s Equity Research in New York, who said a resurgent GM and Toyota will make it difficult for Ford this year to repeat the significant U.S. market share gains it made in the last two years, Bloomberg, Jan. 27

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