Sleuth: The Week of May 18

Hot off the press!

Infiniti readies competitor for small Audi and BMW models: With the premium small-car segment heating up, there is a significant player who wants to get involved. The Sleuth hears that Infiniti (Nissan’s luxury division) is working on an all-new model to do battle with the likes of the forthcoming BMW 1-series and Audi’s A3. This gumshoe’s spies report that Infiniti is already hard at work developing the yet-to-be-named model. Nissan officials say it will be like nothing currently offered in the segment, indicating that Infiniti is working on an even smaller sport-utility vehicle to slot below the recently launched EX35. The new model shouldn’t be a secret too much longer. We know that Infiniti will launch it in 2010.

Nissan gives up its Titan and takes on the Ram: Late last year we heard that Nissan and Chrysler would supply each another with big trucks. Here are few more details, straight from the Sleuth. Both will be built on the 2009 Dodge Ram platform at Chrysler’s Satlillo, Mexico plant. The Nissan will only share the doors and roof panel with the Ram and Nissan will offer only two cab styles, just like the current model. Like the Dodge, the rear bed sides will feature lockable storage pockets. Under the hood, Chrysler will supply the Titan with a range of engines in place of Nissan’s sole 5.6-litre V8 that’s currently available. The trucks will also use the forthcoming light-duty Cummins diesel V8, expected to arrive in 2010.

Bigger things come from small Toyotas: The Japanese automaker is leaning in favour of producing larger models based on its upcoming iQ minicar platform, the Sleuth hears. The move would pit the iQ squarely against Volkswagen’s Up, due to arrive in two years. Despite having very “green” intentions, the Sleuth’s spies say that Toyota has no plans to produce a hybrid gas/electric variant. Not only does the iQ not have enough spare room to house the required battery pack, but the added heft would negate Toyota’s weight-saving measures to make the iQ as thrifty as possible. Instead, the car will use a range of fuel-sipping powerplants: two gasoline units and one diesel.

First Jag and Land Rover, now Volvo?: Jerry York, a prominent representative of Kirk Kerkorian’s Tracinda Corp, said he thinks Ford should sell Volvo and sell or kill off Mercury. Tracinda famously attempted to arrange an alliance between General Motors and Renault-Nissan last year, but failed and subsequently dumped most of its GM stock. Tracinda is now increasing its stake in Ford. York said he believes parent Ford’s CEO Alan Mulally is probably planning to sell Volvo within the next 18 months. He said there is no “rational reason” for Ford to keep the Swedish brand, according to trade publication Automotive News. York says he was simply speaking hypothetically, but he did meet with Mulally last month, suggesting his speculation might be well founded. As for Mercury, York outlined two options: selling the brand or simply shutting it down. He’s not the only one to suggest that. Mercury has been on the bubble for many in recent years. What a shame for a proud brand. But, remember Oldsmobile.?

If your Lambo feels too much like an Audi . . . :

Platform and component sharing has become a way of life with many automakers and Audi and Lamborghini have been no exception. The Gallardo is criticized by many in the industry for sharing too many parts with Audi’s R8 less expensive supercar and this has prompted the exotic automaker to institute an internal policy that will limit Audi parts use to no more than 20 per cent, which still seems like a lot to the Sleuth. To maintain the brand’s image and keep its customers from feeling like their cars are too off-the-shelf, Lamborghini President Stephen Winkelmann vowed only internal, high-cost parts will be shared with Audi. That makes sense to the Sleuth. “That could include things like the electrical platforms that need high investment, or hoses and filters, but we have to safeguard against too much of it,” he said recently.

Market indicators

North American prices for automobiles: Buyers here are already battling higher prices at the gas pumps, but they will soon have to deal with higher prices at dealerships, too. Thanks to slumping sport utility vehicle and truck sales — automakers’ biggest cash cows — and pending environmental regulations, the average vehicle cost is set to rise. General Motors’ marketing and sales head Mark LaNeve says these factors will push new car and tall-wagon prices beyond their current levels. “The challenge for the industry from a revenue standpoint is . . . revenue has disappeared due to the truck market declines, higher commodity prices, the cost to develop technology to meet CAFE (corporate average fuel economy) and other regulations,” LaNeve told industry trade paper Automotive News. “So prices are going to have to come up over time.” LaNeve didn’t mention how much of an increase to expect and when, but did indicate that some of GM’s competitors have already raised their pricing.

Let’s make a deal: Higher fuel prices and stricter emissions and fuel-economy standards are changing the landscape of the auto industry, but perhaps no automaker will be as greatly affected as Chrysler. Thanks to private ownership, Chrysler plans to scale down its operations and rely more heavily on joint ventures. Instead of launching several new models every year to boost sales, Chrysler will slow its production launches and focus on making existing and future products better. To fill out its lineup, Chrysler will rely on partnerships with other automakers such as the recently inked deal with Nissan to supply a new small car. But despite vehicles being made by other companies, Chrysler Vice President Jim Press says that they will be injected with plenty of “Chrysler DNA.” On the flip side of that coin, Chrysler will continue to look to other automakers to maximize its production capacity.