Honda Says It Isn’t Planning U.S. Asset-Backed Security Sale

March 6 (Bloomberg) -- Honda Motor Co. said it doesn’t plan to issue new securities backed by auto loans after a Japanese news agency reported that the carmaker’s U.S. credit arm seeks to raise about $1 billion every few months from such sales.

Japan’s Nikkei English News said today that Honda’s American Honda Finance Corp. would regularly issue 100 billion yen ($1.02 billion) of asset-backed bonds, citing no sources. Nissan Motor Co.’s U.S. finance arm plans to raise a similar amount with ABS issues, Nikkei said.

“We aren’t currently issuing asset-backed securities,” said Marcos Frommer, a spokesman for Honda’s U.S. unit in Torrance, California. Economic conditions don’t favor such sales, he said.
Fred Standish, a spokesman for Nissan’s U.S. unit, said the company doesn’t discuss future financing options such as ABS sales. Nissan raised $475 million from an ABS sale in December, he said.

Honda and Nissan are both based in Tokyo.

Source;
http://www.bloomberg.com/apps/news?pid=20601101&sid=ap5LWT7nHhZE&refer=japan#

GM, Ford May Face Bankruptcy on Slowdown, S&P Says

Well, these are some pretty intense times with how the stock market has taken a tumble, leading the way is GM and FORD. Times have not been good to either company and it is heavily reflected in how the economy has gone. A healthy domestic car sector is a healthy economy. Let's hope they can turn it around.
Oct. 10 (Bloomberg) -- General Motors Corp., Ford Motor Co. and Chrysler LLC may be forced into bankruptcy by slowing economies and dwindling U.S. auto sales, Standard & Poor's analyst Robert Schulz said.

"Macro factors could overwhelm them at some point'' even as the three biggest U.S. automakers vow to stick with their turnaround plans, Schulz, S&P's lead automotive credit analyst, said today in a Bloomberg Television interview in New York. The companies said they have no plans for a bankruptcy filing.

His assessment underscored the pressure on GM, Ford and Chrysler as the worsening global credit crisis makes it harder for buyers to get loans and dealers to finance their operations. S&P said yesterday it may further trim credit ratings for GM and Ford on forecasts for 2009 auto demand falling to the lowest level since 1992.

With all three companies working to boost cash, any bankruptcy filing would be a last resort, not a "strategic'' decision, Schulz said.

"We don't see that as something they would choose,'' he said. Schulz said the "trigger'' for a forced restructuring under bankruptcy protection would be based on the automakers' ability to preserve liquidity as sales decline. Industrywide U.S. sales slid 27 percent last month, the most in 17 years.

'Not an Option'

"Bankruptcy is not an option GM is considering,'' spokeswoman Renee Rashid-Merem said yesterday. "It would not be in the interests of our employees, stockholders, suppliers or customers.''

Ford and Chrysler also have said they're not considering bankruptcy.

GM rose 7 cents, or 1.5 percent, to $4.83 at 1:40 p.m. in New York Stock Exchange composite trading, while Ford dropped 8 cents to $2. GM slumped to a 58-year low yesterday and Ford closed at its lowest since 1982. Chrysler is closely held.

Operating-cash needs at GM, Ford and Chrysler are "substantial, so if it looked like they were going to be pushing toward that number because of these operating losses and cash usage, that's sort of the point where they'd have to consider'' bankruptcy, Schulz said.

S&P said yesterday that its debt ratings for GM and Ford, already at six steps below investment grade at B-, may be lowered again because the automakers face a "serious challenge'' in 2009.

Barclays Capital reduced its target stock price for GM to $4 today, with analyst Brian Johnson in Chicago citing dwindling global auto demand.

GM's Cash Needs

"With auto sales stalled in the U.S. and beginning to contract in the rest of the world, we believe GM's cash needs are increasing,'' Johnson wrote in a note. "Moreover, the downside risk of greater decline in worldwide auto sales driving greater cash needs is increasing."

GM and Dearborn, Michigan-based Ford lost a combined $24.1 billion last quarter. GM last posted an annual profit in 2004, while Ford hasn't had a full-year profit since 2005.

GM's Rashid-Merem said the automaker still expects to add $15 billion in liquidity by the end of next year, including speeding up plans to cut $10 billion in costs.

Ford has a cash cushion, spokesman Mark Truby said yesterday in response to S&P's report raising the prospect of another ratings cut.

Ford's Borrowing

"We were fortunate to go to the markets at the right time,'' Truby said, referring to $23.4 billion borrowed in late 2006 to help pay for shutting plants and cutting jobs while developing new models.

He said Ford is reviewing its liquidity and will give an update when third-quarter financial results are released. Ford hasn't given a date for the release, which the company typically issues later in October.

Chrysler has no plans to declare bankruptcy, spokeswoman Shawn Morgan said yesterday in an interview.

The automakers won Congress's approval last month for funding a $25 billion loan package to help develop more fuel- efficient vehicles. Those funds will be spread primarily among Ford, GM and Auburn Hills, Michigan-based Chrysler, though other automakers, such as Volkswagen AG, have said they will seek a portion.

Regulators are writing the rules for that borrowing even as auto-market conditions worsen. Industry researcher J.D. Power & Associates estimated yesterday that U.S. industrywide sales will fall to 13.6 million this year and 13.2 million in 2009. Last year's total was 16.1 million.

Industrywide Outlook

Industrywide sales of 13 million autos next year would mean shrinkage in the overall U.S. vehicle fleet, said Erich Merkle, an analyst for consulting firm Crowe Horwath LLP in Oak Brook, Illinois.

"We are going to find people where they may have had three cars and now have two, and two cars now have one, and a lot of that is just because of the economic environment,'' Merkle said. "They may not have the ability to buy a new car and even if they do, they may not be able to get financing for that car.''

Global demand in 2009 may be even worse, with "an outright collapse'' now possible, according to J.D. Power, which is based in Westlake Village, California.

GM may announce further production cuts or plant closures as early as next week, the Associated Press reported today. GM spokesman Tony Sapienza declined to comment on the report in an interview.

In July, GM said it was considering further cuts to its metal stamping and engine plants because of reduced U.S. sales.

GM's 8.375 percent note due July 2033 fell 5.5 cents to 19 cents on the dollar today, yielding 43.9 percent, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority.

Ford's 7.45 percent note due July 2031 declined 12 cents to 22 cents on the dollar, yielding 33.8 percent.

To contact the reporters on this story: Jeff Green in Southfield, Michigan, at jgreen16@bloomberg.net; Greg Bensinger in New York at gbensinger1@bloomberg.net


Below each logo is a link to the ticker for each company's stock quote in US funds.

Ford Motor Co. General Motors Corp.

Source;

http://www.bloomberg.com/apps/news?pid=20601082&sid=aFTJLqMhYLAs&refer=canada

Honda, Citing Battery Limits, Avoids Rush to Plug-Ins

Masaaki Kato, president of Research and Development at Honda Motor Company, stands for a photo in the company's North American headquarters in Torrance, California, on Sept. 12, 2008. Photographer: Jonathan Alcorn/Bloomberg News

By Alan Ohnsman

Sept. 15 (Bloomberg) -- Honda Motor Co., first to lease hydrogen autos to U.S. drivers, said batteries haven't advanced enough to make rechargeable cars a good replacement for gasoline models and isn't following rivals who plan to sell plug-ins.

"For battery-powered vehicles to become more widespread, more popular in the market, we feel battery technology needs to advance further,'' said Masaaki Kato, president of Honda's research unit, in an interview at the Tokyo-based company's U.S. headquarters. Expectations for plug-ins are big and ``we don't know that that could be sustained right now,'' he said.

Honda is bucking an industry move toward lithium-ion batteries as record-high U.S. fuel prices this year and climate change concerns over carbon dioxide push carmakers to develop alternatives to gasoline power.

General Motors Corp. sparked interest in a new generation of electric cars with its Volt, a sedan due by 2010 that will travel 40 miles solely on lithium-ion batteries before needing a recharge. Toyota Motor Corp., Japan's largest automaker, and No. 3 Nissan Motor Co. are also readying small electric cars powered only by batteries.

A production version of GM's plug-in Volt is to be shown tomorrow in Detroit.

"GM and Toyota are slugging it out for attention as technology leaders in this area,'' said Phil Gott, a powertrain analyst for market forecaster Global Insight Inc. in Lexington, Massachusetts. "Honda doesn't want to get in the middle of that. They've also been fast to market with many technologies, and don't have anything to prove right now.''

'Impossible to Imagine'

Vehicles using lithium-ion power wouldn't satisfy most consumers, since such batteries are costly and still hold less than half the energy of gasoline by weight, Kato said.

"We just don't see it providing the type of driving performance you get with a gasoline-powered vehicle,'' Kato said Sept. 12 in Torrance, California, speaking through a translator.

For example, the Japanese government's advanced battery development program has a goal of boosting energy storage capacity by seven times and cutting cost to 2.5 percent of the current level, said Kato, who is also senior managing director for Japan's second-largest automaker.

"That gives you a pretty clear example of what type of gap we're facing relative to a gasoline vehicle,'' he said. "At this point, I'd say it's impossible to imagine a date at which such a breakthrough could occur.''

Refining Fuel-Cell System

While Honda may offer a plug-in at some point, for now it will continue refining the fuel-cell system in its new hydrogen- powered FCX Clarity sedan, Kato said. Based on advances the company has made with the vehicle, including improving range to 280 miles, ``we believe it's easier than battery innovation,'' Kato said.

Such a choice isn't unusual for Honda, said Michael Omotoso, powertrain analyst for market-research firm J.D. Power & Associates in Troy, Michigan.

"This fits in with their reputation for conservative product decisions,'' Omotoso said. ``They opted not to offer V-8 engines and stayed out of big trucks, and they're doing well this year because they focused more on small cars.''

Source:
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a1gUi10kXBsM

Honda considering bringing Japanese models to the U.S.

Aug. 6 (Bloomberg) -- Honda Motor Co., encouraged by U.S. demand for Fit subcompacts, is reviewing its Japanese lineup for other possible imports as near-record fuel prices spark interest in cars once viewed as too small or quirky.

"There are a couple of things that we are looking at again, whether they make sense right now,'' Dan Bonawitz, Honda's U.S. vice president for corporate planning, said in an interview yesterday, without naming specific models.

The U.S. introduction of the Fit in 2006, five years after its Japan debut, is helping Honda post gains in 2008 even as a slowing economy and gasoline that topped $4 a gallon erode industrywide demand. U.S. sales of the hatchback, rated at 30 miles per gallon in combined city and highway driving, jumped 73 percent through last month.

Those gains contributed to making Honda the only major automaker to expand U.S. sales this year. General Motors Corp., Ford Motor Co. and Toyota Motor Corp. are now also considering bringing in small cars designed for overseas markets.

Honda has studied the compact Stream wagon and a Japanese version of the Odyssey minivan that would be categorized as a station wagon in the U.S., Bonawitz said in an interview in Malibu, California. He declined to say whether either would be added to Honda's U.S. lineup.

The automaker is also benefiting from demand for fuel- efficient Civic small cars and four-cylinder Accords. Honda's U.S. sales have grown 3.2 percent this year, compared with an 11 percent industrywide decline through the first seven months.

The company won't rush any Japan market models to the U.S. until it's confident current U.S. patterns are likely to continue, said Bonawitz, who manages a team of U.S. product planners.
"We've got a fairly long-term product plan laid out and we're going to try to stick with that,'' Bonawitz said.

The company's U.S. headquarters are in Torrance, California.
To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net.