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Inside this issue
Detroit City Bankruptcy Unlikely to Hurt Automakers
Detroit, Cradle of U.S. Auto Industry, Seeks Bankruptcy Protection
Report: Russia Poised to Become 5th Largest Auto Market
Two Continents, Moving in Opposite Directions
Honda Overhauls Fit Hatchback After Enlisting Supercar Designers
Chevrolet's 'Bowtie' Logo Hits 100
Click here for more auto industry news at NADAFrontPage.com. .
Top Stories
Detroit City Bankruptcy Unlikely to Hurt Automakers

Automakers say they support Detroit, but most operations are outside the city

The city of Detroit's bankruptcy filing apparently won't affect the Detroit Three automakers who, along with Motown soul music, made the city famous and at one time, prosperous. General Motors, the biggest Detroit automaker, the only one with its headquarters literally in Detroit, and a company not that far removed from the sting of its own bankruptcy filing in 2009, says, "We do not anticipate any impact to our daily operations or business outlook" from the city's insolvency. Republican Gov. Rick Snyder of Michigan on Thursday authorized the city, more than $18 billion in debt, to seek federal bankruptcy protection. Detroit's declining population and falling tax base have eroded its finances. Chrysler Group says it "believes in the city of Detroit and its people. We not only continue to invest in the city and its residents by adding to our presence in Detroit, we also are committed to playing a positive role in its revitalization." Ford Motor, which was founded in nearby Dearborn and never has been based within the city of Detroit, says, "We believe a strong Detroit is critical for a strong Michigan and our industry. The city has a difficult job ahead, and we are optimistic that governmental leaders will be successful in strengthening the community."
Source: USA Today

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Detroit, Cradle of U.S. Auto Industry, Seeks Bankruptcy Protection

Detroit, cradle of the U.S. auto industry, became the most populous American city to file for bankruptcy, seeking court protection from creditors while it tries to eliminate a budget deficit and cut long-term debt. "I authorize this necessary step as a last resort to return this great city to financial and civic health for its residents and taxpayers," Michigan Governor Rick Snyder, a Republican, said in a letter Thursday authorizing Kevyn Orr, the city's emergency manager, to file the petition. Michigan's largest city has seen its population decline to 707,000, down 7 percent since 2010, according to U.S. Census data. Median household income was less than $28,000, compared with $49,000 statewide, and more than 36 percent of residents lived in poverty as of 2011, Census data show. The median home value of $71,000 was barely half the $137,000 value statewide. The city listed assets and debt of more than $1 billion in a Chapter 9 petition filed [Thursday] in court in Detroit. Chapter 9 of the U.S. Bankruptcy Code is reserved for municipalities and differs from the rules used by bankrupt companies in Chapter 11.
Source: Automotive News

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Report: Russia Poised to Become 5th Largest Auto Market

A new report says Russia could become the world's fifth-largest auto market by the end of the decade. The report, from global firm Boston Consulting Group, projects that Russia's auto market, which totals about 2.9 million sales annually, will grow at an annual rate of 6 percent through the end of the decade and surpass 4.4 million per year. Russia is currently seventh — it was tenth in 2009 — but will be aided in coming years by special government programs to entice citizens to buy cars. In addition, automakers like Ford Motor Co. and General Motors Co. have recently built plants in Russia for locally produced products. Only China, the U.S., India and Brazil will be larger auto markets by 2020, according to the BCG report. Russia will surpass Germany as the largest auto market in Europe by that time, though many in the industry expect that to happen in the next few years. But the BCG study also warns that Russia's potential “might easily be undone” by market volatility — Russia is an oil-dependent country — and labor costs, which are higher when compared to many of its peer nations.
Source: The Detroit News
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Two Continents, Moving in Opposite Directions

European new-car sales have fallen to the lowest level in more than a decade while American new-car sales have been recovering. Over the last year, sales have increased in only three of the 20 largest countries in the European Union — Britain, Hungary and Denmark. In none of them have sales risen as rapidly as in the United States. Click here to see the change in 12-month new-car registrations.
Source: The New York Times
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Honda Overhauls Fit Hatchback After Enlisting Supercar Designers

Tensions already ran high at Honda Motor Co. in October 2011, two months after Consumer Reports ridiculed the onetime favorite Civic as a substandard car, when President Takanobu Ito saw drawings of the next Fit. He ripped up the plans and summoned his top two designers. “The design had no character and looked very much like its predecessor,” said Yoshinori Asahi, who co-designed Honda's top-of-the line NSX supercar. “That made us worried about the future of the car.” Almost two years later, Tokyo-based Honda is unveiling the overhauled Fit [Thursday] with a stretched front grille, tapered headlights and indented doors. Ito has said much is riding on the Fit, singling out the car as a driver of Honda's global growth until at least 2015, especially in emerging markets, as motorists increasingly shift toward smaller automobiles.
Source: Bloomberg
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Chevrolet's 'Bowtie' Logo Hits 100

Chevrolets for 100 years -- all 215 million of them -- have come dressed in a bowtie. The bowtie is what General Motors calls its Chevy logo, just like Ford's corporate emblem is known as the Oval. But from where did Chevy's come? GM, to mark the centennial, thinks its knows the answer. It goes back to General Motors founder William C. Durant, who introduced the in the 1914 on two Chevrolet models. GM points to his daughter's book as saying he sketched out the logo one night. It also notes a 1968 interview with his widow, who says it came to him while reading the newspaper one night. But the real sleuthing was laid to Ken Kaufmann, historian and editor of The Chevrolet Review, who tried to figure out what Durant might have been reading. Sure enough, the Nov. 12, 1911 edition of Atlanta Constitution included an add for the Southern Compressed Coal Company, which produced a fuel called "Coalettes." Sure enough, the logo for Coalettes featured the same shape. GM says the bowtie design first appeared in a Chevy ad on Oct. 2, 1913 edition in The Washington Post. It urged buyers to "Look for this nameplate."
Source: USA Today
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Quotable
"A healthy auto industry will play a part in Detroit’s comeback story ..."

    --  General Motors in a statement commenting on Detroit's bankruptcy, Bloomberg, July 19



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