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Marijuana found in Fusions

Investigators are trying to work out how a shipment of marijuana, worth $(US)1 million was hidden in the boots and spare wheel compartments of a group of brand new Ford Fusion vehicles.

The cars were manufactured at the Ford plant in Hermosillo, Sonora in Mexico and sent by rail to a dealership in Ohio.

The haul was packed in the spare tire wheel wells and according to Silverio Balzano, agent in charge of the Drug Enforcement Administration’s Youngstown office says someone forgot to pick them up on the way. “Clearly something went wrong,” he told news agency, CNN.

The July incident is not the first and in March, police in Dilworth, Minnesota, also discovered drugs packed in the spare wheel spot of a group of Ford Fusions.

“We’re aware of the situation and are taking it very seriously,” a Ford Motor Company spokesman said recently. “We are working with the FBI and Customs on an extensive investigation. We have confirmed that this is not happening at our plant or at our internal shipping yards.”

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Car sales down in US; SUVs up

US car sales fell slightly in February, despite heavy dealership discounts, according to sales data released today.  

February sales were mixed across the major car makers in America. GM sales increased 4.2 per cent, and Nissan grew 3.5 per cent. Honda also saw a slight sales gain of 2.6 per cent, led by a 12 per cent surge in SUVs and utes.

Volkswagen sales increased 12 per cent, Subaru’s sales rose 8.3 per cent, and Mercedes-Benz sales were up 6.9 per cent.

Hyundai remained static, with no sales growth or decline compared to last February.

Ford sales, however, declined four per cent overall as sedan and hatchback sales dropped 24 per cent. Toyota sales fell 7.3 per cent on the back of a 15 per cent decrease in Camry sales.

Fiat Chrysler reported a 10 per cent drop in sales, with its large-volume Jeep SUV brand dropping 15 per cent. Kia sales fell the furthest proportionally, with sales down 14.2 per cent compared to February 2016.

Experts predicted the demand for cars, SUVS and utes to drop compared to February last year. Sales rose one per cent, however, triggering a rise in shares for GM, Ford, and Fiat Chrysler.

Despite the rise, analysts are still cautious. Discounts hit 10 per cent of the average selling price for February as car makers tried to unload vehicles onto the market.

“With the industry at 10 percent you are in a push market,” said Mark Wakefield, head of the North American automotive practice for consultancy AlixPartners, told Reuters.

A push market means manufacturers are pushing discounted vehicles onto consumers, rather than responding to the pull of demand.

The challenge, Wakefield added, is for car makers to avoid over-producing vehicles or cutting profit margins too thin.

Sales of SUVs and utes continue to rise, which means higher profits for the industry. Ford US sales chief Mark LaNeve said in a statement the company sold 65 per cent SUVs and utes and 35 per cent cars.

 

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Volkswagen announces airbag recall

The Associated Free Press has reported that Volkswagen will recall nearly 600,000 vehicles, mostly Audis, in the US over defects that could results in fires or airbag malfunctions.

According to the National Highway Traffic Safety Administration, no fatalities have yet occurred in the US. The recall follows numerous incidents in China and Israel in 2016.

A Volkswagen spokesman said dealerships will repair and replace parts free of charge. A corrosion problem that could prevent airbags from deploying affects more than 234,000 Audi 2011 to 2017 A5 models.

Faulty coolant pumps that can overheat and cause fires have affected 342,800 Audi A4s, A5s, A6s and Q5s produced in or after 2012. Another 5,901 Audi A4, A6, Q7 and Q5 2017 and 2018 models risk faulty airbag deployment and seat belt problems.

Among the Volkswagen brand, the 2017 Golf, the 2016 e-Golf, and the 2017 Tiguan have been recalled with the same potential defects.

The National Highway Traffic Safety Administration did not specify whether the defective airbags were manufactured by Japanese firm Takata, currently embroiled in the largest car product recall in history. Over 850,000 Audi and VW vehicles were recalled due to faulty Takata airbags in October 2016.

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VW emissions settlement approved

US District Judge Charles Breyer has approved the $1.7 billion settlement between Volkswagen AG and its American dealers over its long-running diesel emission scandal. The 651 VW dealers will receive an average payout of $2.5 million, which Breyer says “adequately and fairly compensates” the members of the class-action suit.

In September 2015, a VW spokesperson admitted to installing secret software in the company’s diesel cars to cheat exhaust emissions tests, when the vehicles actually emitted up to 40 times the legally allowable pollution levels. Dealers argued that the fall-out from the scandal tarnished the Volkswagen brand and cost billions nationwide in sales.

Vice-president and director of economics services for Fontana Group Edward Stockton estimated the lost profit from the American dealers to be within the range of $2 billion to $2.2 billion, a figure Breyer accepted in his verdict.

Seven dealerships opted out of the settlement, and eight dealerships filed objections to the final ruling, mostly related to the method of calculating the average settlement amount.

An agreement has also been made to maintain incentive payments to dealers and will allow them to defer capital improvements for two years. Over $30 billion has been spent addressing claims from environmental regulators, owners, dealers and state government bodies related to its fraudulent vehicle emissions in the US.

As well as a cash payment to dealers totalling $1.7 billion, the settlement also includes support payments of $270 million and ongoing VIP and continued sales incentives of $238 million. The class counsel estimates the settlement value at over $2.3 billion.

“The Volkswagen-branded franchise dealer class-action settlement finalised today represents an outstanding result for Volkswagen’s affected franchise dealers,” said Steve Berman, managing partner of Hagens Berman and lead attorney for the dealers, who said they were “blindsided” by VW’s fraud.

The ruling states that any responses must be filed by February 8.

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Hyundai US CEO fired

With the increasing pressure to perform in a changing economy, Hyundai Motor America has fired the CEO Dave Zuchowski for failing to meet internal sales objectives.

According to Automotive News, 59-year-old executive vice president, Jerry Flannery will take over as CEO until a successor is chosen.

“We appreciate Dave’s decade of service to Hyundai, especially his leadership as president and CEO, which has made us a stronger organization,” Flannery said in a statement.

Zuchowski, joined the company as U.S. sales chief in 2007, however following the recession, the company struggled due to a variety of factors including falling petrol prices.

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Manufacturers seek law changes

The Alliance of Automobile Manufacturers (ALAM) is waiting for a reply from a letter they sent President-elect, Donald Trump.
The eight-page letter, which was reported by Reuters, highlighted the need to revise fuel efficiency mandates and autonomous vehicle policies under the Obama administration.
ALAM includes General Motors Co, Ford Motor Co and Toyota Motor Corp and sent a letter which stated that “technology and change are swamping the regulatory capacity to manage our emerging reality. Reform is imperative.”
The letter also seeks a “robust examination” of the combined impact of “uncoordinated regulatory oversight” by at least 10 federal and state agencies.
It urges creation of a new timetable for regulators to respond to industry requests and seeks that regulators adopt a “whole car cost analysis” for new vehicle regulations.
In September, the Obama administration said it was considering seeking the power to review and approve technology for self-driving cars before they hit the road.
The National Highway Traffic Safety Administration (NHTSA) and Environmental Protection Agency (EPA) must decide by April 2018 whether the 2022 through 2025 model year requirements for fuel efficiency and greenhouse gas emissions should be changed or not.

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