Continue reading House: Save the auto dealers! Can Ford survive the intervention?

House: Save the auto dealers! Can Ford survive the intervention? originally appeared on BloggingStocks on Wed, 10 Jun 2009 09:20:00 EST. Please see our terms for use of feeds.

Continue reading Daimler working with Tesla on electric car

Daimler working with Tesla on electric car originally appeared on BloggingStocks on Tue, 19 May 2009 15:20:00 EST. Please see our terms for use of feeds.

DaimlerChrysler (DAI) and Euorpean automakers 'attractive' originally appeared on BloggingStocks on Fri, 21 Sep 2007 11:47:00 EST. Please see our terms for use of feeds.

MOST NOTEWORTHY:

• AG Edwards initiated Quicksilver Gas Services (NYSE: KGS) with a Buy rating and $26 target as the firm believes the company's distribution growth has high visibility, based on its current asset base and the possibility of third-party acquisitions. UBS initiated shares with a Buy rating and $34 target.
  
• Hireright (NASDAQ: HIRE) was initiated with a Market Perform rating and $13 target at Piper Jaffray, as the firm believes the company's distribution growth has high visibility, based on its current asset base and the possibility of third-party acquisitions. CIBC is positive on Hireright's extensive solution set and strategic alliances and initiated shares with a Sector Outperformer rating.
  
• DaimlerChrysler (NYSE: DAI) was started at Bear Stearns with an Outperform rating. Following the Chrysler transaction, Bear expects Daimler to raise its margin guidance now that the company can focus on its truck platform.
  
• Masimo Corporation (NASDAQ: MASI) was initiated with an Outperform rating at Piper Jaffray, as the firm believes the company's "best in class" technology will drive continued pulse oximetry share gains. Cowen initiated shares with a Neutral rating on valuation and Deutsche Bank started shares with a Buy rating and $30 target..

• TD Newcrest started shares of Vitran Corporation (NASDAQ: VTNC) with a Hold rating.
  
• Lazard started shares of E-House China Holdings (NYSE: EJ) with a Buy rating; CIBC initiated shares with a Sector Outperformer rating and $25 target.
  
• Rodman & Renshaw initiated shares of Iomai Corporation (NASDAQ: IOMI) with a Market Outperform rating and $4.25 target.

Analyst Initiations: KGS, HIRE, DAI and MASI originally appeared on BloggingStocks on Mon, 17 Sep 2007 11:45:00 EST. Please see our terms for use of feeds.

Cerberus assumed 80% ownership of Chrysler from DaimlerChrysler (NYSE: DAI) on August 3. Cerberus is now engaged in contract talks with the United Auto Workers as it looks for ways to cut costs. The union is reportedly opposed to the sales for fear of job losses; the units employ roughly 1,300 unionized workers. Chrysler's four-year contract with the UAW expires on September 14.

Analysts are saying that the sale of the units would allow Cerberus to focus on Chrysler's core business of making cars and trucks, and help raise much-needed cash. But Mopar is hardly a peripheral unit. Chrysler has been using the term to refer to its parts since the 1920s, and Mopar has long been virtually synonymous with the automaker. This is especially true when it comes to high performance cars, including the famous muscle cars of the 1960s and 1970s -- the Barracuda, the Super Bee, the Road Runner -- that Chrysler is trying to revive. So you have to wonder if this is a good move in the long run. Let's hope that Chrysler doesn't lose what makes it unique and desirable to car lovers as it works to return to profitability.

Cerberus may sell Chrysler's Mopar originally appeared on BloggingStocks on Wed, 29 Aug 2007 11:15:00 EST. Please see our terms for use of feeds.

Continue reading U.S. automakers see lowest market share ever!

U.S. automakers see lowest market share ever! originally appeared on BloggingStocks on Wed, 01 Aug 2007 19:10:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• The FDA said no to Pristiq, an experimental Wyeth (NYSE: WYE) drug to treat the symptoms of menopause, reported the Wall Street Journal.
• The $3.1B sale of General Motors Corporation's (NYSE: GM) Allison Transmission to Carlyle Group and Onex has stalled in the debt financing market, thanks to difficulties raising debt from investors, reported the Wall Street Journal's "Heard on the Street" column.
• LVMH Moet Hennessy Louis Vuitton (OTC: LVMUY) is expected to acquire Les Echos from Pearson (NYSE: PSO) for $331.9M, reported the Wall Street Journal.

• Time Warner Inc's (NYSE: TWX) AOL is entering the behavioral-targeting ad market by purchasing Tacoda, which uses "behavioral targeting" techniques to track Web surfers' habits, reported the New York Post.
• Cerberus Capital Management's acquisition of DaimlerChrysler AG's (NYSE: DCX) Chrysler unit could be completed on Monday or Tuesday of next week, reported the Detroit Free Press.

Newspaper wrap-up 7-24-07: Chrysler sale could be completed next week originally appeared on BloggingStocks on Tue, 24 Jul 2007 09:15:00 EST. Please see our terms for use of feeds.

Ford (NYSE: F) kept is crown as the NYSE short interest king in June with 214.1 million shares sold short.

The high figure should really be no surprise. Ford's stock has underperformed GM (NYSE: GM), DaimlerChrysler (NYSE: DCX), and Toyota (NYSE: TM) over the last month.

A week ago, Ford said that it was falling behind its cost-cutting goals. Most analysts thing it will take a long time for the car company to sell its Jaguar and Land Rover units.

But, the major knock against Ford is that it has had less success than its competition coming to market with cars that US buyers want to own. In May, both GM and Toyota had increases in sales compared to the same month last year. But, Ford's sales fell despite its own forecasts for a small increase. Consumers bought new models like the Escape, but sales of big profit vehicles like the Explorer and the F-series pick-up are in multi-month declines.

There is little proof that Ford's cost cuts are keeping up with falling sales. With negotiations with the UAW beginning in September, the company must depend on a good outcome to keep its very modest recovery on track. And, that outcome is hardly assured.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Ford remains short interest king originally appeared on BloggingStocks on Fri, 22 Jun 2007 08:00:00 EST. Please see our terms for use of feeds.

When the old, conservative Harley-Davidson Inc. (NYSE: HOG) set out to build a three-wheeled version of the iconic American motorcycle, they would have followed the standard, two-rear, one-front wheel design. Judging from their recently filed patent application, though, the company is showing a new boldness by setting off in a different, cutting-edge direction with a cool two-front, one-rear wheel, high performance design.

Last fall, the company announced an agreement with Lehman Trikes U.S.A. to cooperatively develop a three-wheeled motorcycle. For many years, Lehman has been the industry leader in converting motorcycles such as Harleys and Honda's Gold Wing to three-wheelers. The manufacturers have not been particularly supportive, though. Those who also manufacture all-terrain vehicles (ATVs), such as Honda (NYSE: HMC), are still gun-shy of the configuration in the aftermath of the 3-wheel ATV controversy, in which the industry was forced to accept a consent decree to discontinue building what proved to be an unstable 3-wheeled design.

The industry expected that Harley's design would be an extrapolation of Lehman's standard two-rear-wheel, one-front-wheel design. However, according to patent applications filed by H-D recently, they are taking a much more interesting and groundbreaking approach by pushing a two-front, one-rear-wheel design along the lines of the prototypes popular among performance aficionados made by Piaggio and DaimlerChrysler, among others. This configuration allows much improved cornering, but requires a much more technologically advanced design.

Continue reading Harley-Davidson's three-wheeled HOG

Harley-Davidson's three-wheeled HOG originally appeared on BloggingStocks on Mon, 18 Jun 2007 14:24:00 EST. Please see our terms for use of feeds.

Airbus has 13 orders for its new A350. The competing product from Boeing (NYSE: BA), the 787, has over 600. The Boeing lead has forced Airbus to offer large discounts on its plane

The A350 has had plenty of problems which include fuel efficiency and ease of maintenance complaints. Airbus has tried to address these, but without much success.

The troubles with its new plane fall on the heels of delays in delivery of its larger super-jumbo A380 which competes with the new Boeing 747-8. The problems with both planes may make it difficult for the Airbus parent, EADS, to turn itself around. The holding company has changed its top management is the hope of addressing troubles with new product development, but so far this has not worked.

EADS is owned by arms of the French and Spanish governments and DaimlerChrysler (NYSE: DCX). The owners have fought over which country's unions should bear the majority of cost cuts as EADS and Airbus attempt to save money.

EADS may be an example of the problems that a commercial enterprise has when governments have large interests. Management has to answer to a small number of powerful shareholders who often have different agendas and this can prevent executives from addressing the business problems at hand.

And EADS and Airbus certainly have plenty of problems.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Boeing trounces Airbus originally appeared on BloggingStocks on Wed, 13 Jun 2007 09:00:00 EST. Please see our terms for use of feeds.

Continue reading Up ahead in the U.S.: The 'compromise' car market

Up ahead in the U.S.: The 'compromise' car market originally appeared on BloggingStocks on Thu, 07 Jun 2007 18:10:00 EST. Please see our terms for use of feeds.

There's a great book -- called Taken for a Ride: How Daimler-Benz Drove Off With Chrysler -- that covers the behind-the-scenes details of the 1998 merger that created DaimlerChrysler (NYSE: DCX). On its face, it looked like a smart deal; that is, the auto industry needed consolidation to get economies of scale. Yet, how can you do that with a premium brand and a low-cost brand?

Of course, it didn't work out. Besides the mismatch in target markets, both companies had major struggles with different corporate cultures. There was also a big deterioration in quality (which is fatal for premium brands).

Now Chrysler is going to be owned by a private equity firm, Cerberus Capital Management.

Interestingly enough, according to a piece in Barron's [a paid service], the deal may be very good news for Daimler. While the stock has rallied over the past year, some people think it could reach $100 or more.

Why? First of all, Daimler no longer has the burden of Chrysler's $18 billion in unfunded health care benefits. In fact, that's a key reason why Daimler essentially paid Cerberus about $650 million to take Chrysler.

What's more, Daimler is a much more focused organization. Over the years, Daimler has also instituted a variety of process and efficiency improvements. Thus, these should ultimately help pad the bottom line.

Oh, and Daimler still owns about 20% of Chrysler. So if Cerberus works its private equity magic effectively, Daimler could get a boost from that too.

Tom Taulli is the author of various books, including the Complete M&A Handbook and the EDGAR-Online Guide to Decoding Financial Statements.

Barron's: Why Daimler paid $650 million to shed Chrysler originally appeared on BloggingStocks on Sat, 19 May 2007 16:31:00 EST. Please see our terms for use of feeds.

Continue reading GM, Ford, Chrysler: three steps forward

GM, Ford, Chrysler: three steps forward originally appeared on BloggingStocks on Wed, 16 May 2007 15:45:00 EST. Please see our terms for use of feeds.

Cerberus reportedly has bought 80.1% of Chrysler from parent DaimlerChrysler (NYSE: DCX). Some thought that the UAW's greatest fears have come true. It was believed that the union hoped the car company would fall into friendly hands, perhaps Canadian parts company Magna International Inc. (NYSE: MGA). The heads of the UAW, however, said that the deal was in the best interests of the company.

Ron Gettelfinger, President of the United Autoworkers (UAW), said: "The transaction with Cerberus is in the best interests of our UAW members, the Chrysler Group and Daimler. We are pleased that this decision has been made, because our members and the management can now focus entirely on the development and manufacture of quality products for the future of the Chrysler Group."

Cerberus will contribute $7.4 billion to the venture but all obligations for pensions and benefits will go to the new company.

What continues to puzzle observers is why Daimler would not have done the work to fix Chryler itself.

But, that is academic now.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Chrysler sold: Private equity wins bid and UAW is pleased originally appeared on BloggingStocks on Mon, 14 May 2007 09:43:00 EST. Please see our terms for use of feeds.

The good news for Daimler shareholders is that the stock is up over $85 in pre-market trading, gaining some 3.8%. Obviously, the investing world is thrilled with the divestiture of Chrysler. The two companies never quited jelled with cultural and engineering differences dominating the nearly nine-year relationship.

Daimler shareholders are happy also because the earnings power and leverage will be present once again. With the sale of Chrysler goes the $19 billion pension and health care insurance albatross that Daimler was carrying for the Chrysler retirees.

As I have written before, even though Daimler is looking at quite a loss for its nine-year affair, the shareholders are quite forgiving. Forgiveness has been seen in the share action ever since Daimler said back in February that all options are on the table regarding Chrysler. The shares were trading at $63-64. Today, they are at $85.

Ah, forgiveness is divine...

Georges Yared is the CIO of Yared Investment Research where he explores more growth stock ideas.

Daimler trading at 52-week high in pre-market originally appeared on BloggingStocks on Mon, 14 May 2007 08:55:00 EST. Please see our terms for use of feeds.

The Wall Street Journal is reporting that the private equity firm Cerberus has won the bidding for Chrysler. DaimlerChrysler (NYSE: DCX), which will probably change its name, will hold a small stake in the new holding company. Cerberus bought the majority of GMAC from General Motors (NYSE: GM) last year.

Aside from what Cerberus pays for the U.S. car company, which may be very little, the key to the transaction will be that Daimler will move the $18 billion of Chrysler pension and benefits obligations off of its books.

The UAW is bound to try to derail the deal. They favor having Daimler keep Chrysler or sell it to Canadian car parts company Magna International (NYSE: MGA). In either case, the union believed it could hold on to more jobs. The UAW may now be faced with trying to block the deal at the Daimler supervisory board level, or threaten to strike in the face of the deal. A work stoppage could badly damage Chrysler's already troubled efforts to turn around it sinking U.S. sales.

Cerberus may have the money, but the union holds most of the cards.

Douglas A. McIntyre is a partner at 24/7 Wall St.

Chrysler may have been sold originally appeared on BloggingStocks on Sun, 13 May 2007 15:40:00 EST. Please see our terms for use of feeds.

As if EADS' Airbus didn't already have enough snafus with it's A-380 megaplane program, the General Accounting Office has concluded that the plane poses a safety challenge to America's airports. Are those cheers I hear coming from Boeing Co. (NYSE: BA) headquarters?

The GAO's concerns include:

• Most U.S. runways were not built for planes of this size and weight, and will require an upgrade, service restrictions, or both.
• The increased turbulence it will create on landing and takeoff will mean a need for more buffer area around the plane to guard against impacting other flights.
• This could result in possible reduction in flights and therefore airport handling capacity.
• Its size will impose a large burden on fire and rescue operations.
• The cost of retrofitting airports to accommodate A-380 could be a problem. Heathrow in London has spent $885 million to prepare for the plane's flights.

Continue reading Airbus outgrows American runways: another bumpy flight for A-380

Airbus outgrows American runways: another bumpy flight for A-380 originally appeared on BloggingStocks on Mon, 07 May 2007 15:35:00 EST. Please see our terms for use of feeds.

Continue reading Down the road: Detroit's Big Three brace for the $3K car

Down the road: Detroit's Big Three brace for the $3K car originally appeared on BloggingStocks on Fri, 27 Apr 2007 16:00:00 EST. Please see our terms for use of feeds.

MAJOR PAPERS:

• The Wall Street Journal (subscription required) reported that the UAW and representatives of Kirk Kerkorian, which made a $4.5B proposal for DaimlerChrysler AGs (NYSE: DCX) Chrysler unit, met to discuss the potential of an employee stock ownership plan and other alternatives to a takeover of the struggling automaker.
• A $25B deal to take SLM Corporation (NYSE: SLM), known as Sallie Mae, private will most likely remain under the scrutiny of a federal regulator, reported the Wall Street Journal.

• The Washington Post reported that the FDA knew years in advance about contamination problems at a Georgia peanut butter plant and on California spinach farms that led to disease outbreaks, documents and interviews show.
• According to an examination by the San Jose Mercury News, a criminal case against Apple Inc (NASDAQ: AAPL) CEO Steve Jobs in the stock-options backdating investigation looks unlikely.
• According to Cinco Dias, Gottschalks Inc (NYSE: GOT) has hired UBS AG (NYSE: UBS) to explore options of a possible sale or a merger.

• Digitimes.com reported that Koninklijke Philips Electronics (NYSE: PHG) has decided to withdraw from the Taiwan handset market.

Newspaper wrap-up 4-23-07: Criminal case against Steve Jobs unlikely originally appeared on BloggingStocks on Mon, 23 Apr 2007 09:15:00 EST. Please see our terms for use of feeds.

Chrysler has a plan, right? originally appeared on BloggingStocks on Thu, 19 Apr 2007 10:15:00 EST. Please see our terms for use of feeds.