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The auto industry reported strong sales in March, and for some auto companies, the news was even better.

Buyers at General Motors, Chrysler, Nissan and Hyundai paid record amounts for new vehicles during May, according to True, which tracks statistics about buying habits.

True Car bases its calculations on transaction prices: the final amount people pay, after incentives, bargaining and trade-ins. The numbers include the whole range of vehicles that the companies sell, such as  cars, sport utilities, pickups, and minivans.

Transaction prices are way up since the beginning of 2010. Take a look at this chart by Meg Cramer of Changing Gears, which shows the industry average and what consumers at major carmakers are paying.

Transaction prices are rising because automakers have aligned their production with customer demand, eliminating the necessity for big incentives, said Jesse Toprak, vice president of industry trends and insights at True Car.

“The auto manufacturers have found their sweet spot,” Toprak said.

Higher transaction prices are good news for Midwest communities that have car and parts plants, because it generally means steady or increasing sales. If transaction prices were to drop dramatically, it could mean problems for the industry that might translate to production slowdowns or even layoffs.

Overall, consumers paid an average of $30,091 for a vehicle in March, just a little below the record set in November. That’s up $1,977 from a year ago, and up $143 from last month.

At GM, the average transaction last month was $33,289, according to True Car. That’s a big jump for GM compared where it was two summers ago, before it had introduced vehicles like the Chevrolet Cruze and Volt, and while it was still closing some of its factories.

Chrysler’s average transaction price, $29,842, is the latest leap for the company, whose sales essentially stalled when it was dealing with bankruptcy three years ago.

For Nissan, its $28,322 March transaction price is up almost $2,000 in just a year. Nissan is on a sales roll, and has gotten plenty of attention for its electric Leaf.

At Hyundai, buyers are paying less than at the other players, an average of $21,717 in March. But that still puts Hyundai into the $20,000 and up category, after months in which its vehicles sold in the teens of thousands.

If anything, the chart is good news for car dealers and communities, and maybe not such good news for bargain hunting consumers. But, True Car and plenty of other sites on the Web offer car buying tips.

Have you been car shopping recent? What’s been your experience on prices?



Honda, like Toyota, has suffered through a lot in the past year — sluggish sales, the Japanese tsunami and earthquake, and floods in Thailand. But it’s vowing to get its mojo back and plans to do so by  revving up its American production.

This morning, Honda said it will invest $98 million at its engine plant in Anna, Ohio, the one you’ve probably driven by Interstate 75. The investment comes on top of a $120 million investment at Honda’s transmission plant in Russells Point, Ohio.

The money is going to build a new engine and transmission family called “Earth Dreams.” The transmission plant will make what are called Continuously Varying Transmissions, or CVTs, which don’t have gears but shift up and down smoothly, and the engine plant will produce parts for those transmissions.

“Earth Dreams” will be available for the first time in the United States on the 2013 Honda Accord, which will be built at Honda’s assembly plant in Marysville, Ohio.

Honda’s goal is to increase its sales this year by 20 percent, and it has aggressive plans over the next few years for both its Honda and Acura lineups. Its push is getting kicked off during the Super Bowl this weekend, which, just in case you haven’t seen it, will feature this familiar looking ad.

Right to Work, right away Indiana is expected to be the first state in the industrial Midwest to become a Right to Work state. And it could happen as soon as today. Right to Work rules prohibit companies from negotiating contracts with their unions that make union membership mandatory. Instead, workers will have a choice whether to join the union. Business leaders say the changes will make Indiana more competitive. Union leaders say the changes will let some workers benefit from union bargaining without having to pay to support the union. They say it will ultimately weaken the union.

Pentastar profits Chrysler had its first profitable year since 1997.

Start up money A group of 44 Chicago business leaders are starting a new tech investment fund. Meanwhile, the state of Michigan is thinking of launching its own start-up fund.

Honda invests Honda is expected to announce new investments in two Ohio plants today.

A deal in Detroit The Detroit Free Press reports the city has reached agreements with its unions that could keep the city solvent, and avoid a state takeover.

Indiana Gov. Mitch Daniels got a lot of attention late last year when he finally came out in favor of a Right to Work law. Now, Daniels is suggesting that Volkswagen, in part, is the reason.

Speaking on Inside INdiana Business Television last week, Daniels said he was frustrated that his state was losing opportunities to compete for projects to other states that had Right to Work laws, which prevent unions from collecting mandatory dues.

Mitch Daniels Talks About Right to Work

One such project, according to the governor, was the assembly plant that Volkswagen recently opened in Chattanooga, Tenn. “I couldn’t get VW to return our call,” the governor said. “We’ve won on Honda, we won on Toyota, we’re clearly the fastest growing automotive state, and we couldn’t even get them to talk to us.”

Daniels. by the way, is giving the Republican response tonight to President Obama’s state of the union address.

Daniels was referring to Honda’s assembly plant in Greensburg, which opened in 2008, as well as Toyota’s two production sites. Toyota builds vehicles at its own plant in Princeton, and shares production with Subaru at its plant in Lafayette.

Tony Cervone, a spokesman for Volkswagen of America, declined comment via email.

Daniels’ decision to support a Right to Work law has caused an escalating debate in Indiana. Democratic lawmakers initially refused to attend hearings, even in the face of $1,000 a day fines.

Daniels said in the interview that their protests are justified. “Both sides ought to be heard from. I think the Democrats are within their rights to make a gesture of how strongly they felt, and to say let’s stretch this out a little further. It’s a good process and we’ll accept whatever outcome that comes.”

As the debate continues, companies like Remy International in Pendleton are weighing whether to invest in Indiana, or move elsewhere. looked at the situation for Indiana’s companies and its political future.

Media previews for the North American International Auto Show kicked off this week, with plenty of panache and swagger.

Carmakers are rolling out dozens of new models at the show, ranging from Cadillac and Chevrolet, to Ford and Lincoln, and German automaker BMW.

Japan’s two struggling giants, Honda and Toyota, hope to make a comeback in 2012 after dismal results in 2011.

The auto show always features splashy introductions. Here’s a look at the new Ford Fusion from our friends at Michigan Radio.

Are you visiting the show? Do you some favorites?

Stung by sluggish sales, consumer criticism and bad reviews, Honda announced today that it would revamp its Civic only eight months after it released its latest model.

Critics noted the newest Civic was made from cheaper materials, had slower braking capability compared to its predecessors and failed to receive “recommended” status from Consumer Reports.

Tetsuo Iwamura, chief executive of American Honda Motor Co., made the announcement during an appearance in Detroit on Tuesday. The move comes as part of Honda’s ambitious goal to lift U.S. sales by 24 percent in 2012. Civic sales have been trending in the opposite direction.

U.S. sales of the Civic have fallen 13 percent this year to 200,690, according to researcher Autodata Corp, while Honda’s overall market share in the U.S. dipped one percentage point to 9 percent.

In the past, claims to the compact car market was essentially a two-company race between Toyota and Honda. But two natural disasters disrupted production this year, and competition from the domestic automakers has intensified. The Ford Focus and Chevrolet Cruze have been gaining traction. And combined share for South Korean automakers Hyundai and Kia has risen to 9 percent, up from 7.8 percent in the same time period, according to BusinessWeek.

“The competition will continue to intensify,” Iwamura told The Detroit News. Typically, automakers will wait at least three years before redesigning a model.

In August, David Campion, senior director of Consumer Reports’ auto test center, said that the ’12 Civic “ranks near the bottom of its category.”

Three stories making news across the Midwest today:

1. Angry residents confront Emanuel. Chicago mayor Rahm Emanuel sought solutions for the city’s budget woes during a public meeting Monday night. He got more than he bargained for, according to reports from our partner station WBEZ. A question from a laid-off traffic employee led to an extended back-and-forth with union members in the audience. “I’m responsible to the city taxpayers and the city residents,” Emanuel said, referring to a projected $635 million budget deficit. Audience members yelled that they were taxpayers too.

2. Honda renovates Ohio plants. Honda announced Monday it would spend $355 million to refurbish four plants in Ohio, according to The Columbus Dispatch. The improvements come as the automaker returns to full production following the Japanese catastrophes. The Dispatch reports some jobs will be added, but specifics are not yet available. Honda has more than 13,000 employees in the Buckeye State.

3. Lawmakers seek tax-credit extension. Tax credits for advanced battery manufacturers in Michigan are scheduled to be phased out by Gov. Rick Snyder, but Democrats in the state Legislature want to extend the incentives packages. The Associated Press reported Monday that the Democratic proposal would include tax credits for battery production and facility construction, as well as credits for buying electric vehicles and charging stations.

For nearly a decade, the auto industry’s Big Three included at least one company that wasn’t from Detroit. Now, Chrysler is back among the three best-selling automakers.

It ranked behind General Motors and Ford in May auto sales. It’s the  first time the Detroit Three have been the Big Three since February 2006, according to, a Web site that offers car-buying advice.  During its worst days, such as its 2009 bankruptcy filing, Chrysler fell as low as fifth in the industry, outsold by Toyota and Honda as well as its Detroit neighbors.

Photo by Ricardo Giaviti via Flickr.

The gain isn’t only because Chrysler’s sales have rebounded, although the company has received an image boost in recent months.

The return of the Big Three is in large part due to weakness by Japanese auto companies. They had a terrible month, in part because of disruptions caused by the Japanese earthquake and tsunami.

Sales at Toyota dropped 33 percent from a year ago, while Honda was down 22.5 percent and Nissan was down 9 percent. Hyundai and Kia, combined, came within a thousand vehicles of outselling Toyota. Honda failed to put a vehicle on the top-selling list for the first time that anyone can remember.

Last month, eight of the top 10 selling vehicles in the United States were from Detroit automakers, reported Nick Bunkley in The New York Times. That compares with four of 10 a year ago. The country’s best selling car in May, long the Toyota Camry, was the Chevrolet Malibu.

Says Justin Hyde at,

“And for one month, General Motors, Ford and Chrysler can reclaim the mantle of the “Big Three,” which had until now been stored in a government warehouse next to the Ark of the Covenant. It’s expected to return to its resting place within a few months.”

CHICAGO – There are billions of dollars in business that flow every day between the Midwest and Japan. As Japan tries to recover from the devastating natural disaster there, companies located in the Midwest are starting to assess out how this will affect business here. Here, this report on how deep the economic ties are between our region and the island nation.

Think of economic ties between the Midwest and Japan and household names like Toyota or Honda immediately come to mind.

In all, there are more than 160,000 people across the Great Lake states that directly work for Japanese businesses. To give you an idea, that’s almost two and half times the entire U.S. labor force for General Motors.

Toyota Technical Center, Ann Arbor, MI

And there are many large American corporations – think Caterpillar in Peoria – that in turn are employing Japanese workers there.

Now that’s it’s been a week since the earthquake and tsunami, those companies are trying to figure out where they stand.

“We Toyota people here in North America, we have a lot of friends in Japan,” said Mike Goss, a general manager with Toyota North America.

Toyota has 10 plants in the United States and another four in Canada and Mexico. Every year those facilities buy about $25 billion from suppliers –  many of those based in the region, Goss pointed out:

“In Michigan, Indiana, Ohio, Illinois and Kentucky – we do have a huge impact. What we’re hoping we can is minimize any kind of shutdowns but really the only way we can take a first step on that is the truly assess the situation in Japan,” he said.

In Toyota’s case, even as they’ve just started those assessments, some operations on the U.S. side have already been curtailed.

About 15 to 20 percent of the parts needed to build Toyota cars here in the U.S. come from Japan.

Goss said there were some parts already in the pipeline built and shipped before the earthquake. But, for now, the company plans to stop overtime work to enable those parts coming in to last longer.

Caterpillar headquarters, Peoria Journal-Star

Caterpillar Inc. is based in Peoria, Illinois, but about a quarter of its annual $40 billion of sales and revenue comes from its Asia-Pacific region.


Caterpillar has 5,000 employees at a two big manufacturing facilities in southern Japan and an office in Tokyo that serves as country headquarters.

Spokesman Jim Dugan say initial reports are that Caterpillar’s Japanese workers and facilties are ok – and now, Caterpillar is focused most on helping with the relief effort.

“Corporately, as well as our dealers, we’ll provide a range of assistance in the form of equipment, sometimes expert operators,” Dugan said. “Equipment and those operators are often used in the rescue and recovery efforts after a natural disaster.”

Dugan says the company already donated more than $1 million worth of equipment, generators and its employees’ time to helping Japan recover.

Takeda is Japan’s biggest drug company. Its North American operations are based in Deerfield, just outside of Chicago – more than 1600 people work there. The company has been able to account for all its Japanese workers. Business operations at its manufacturing facilities and research and development labs in Western Japan are continuing. And its US employees say clinical trials here and regular sales and marketing works is going fine.

Michael Moskow is a senior fellow at the Chicago Council on Global Affairs. He says it’s important to take a longer view.

“When you look at natural disasters like this,  they tend to not change the longer term trend of economic development, whether it would be in Japan or the Midwestern part of the United States,” said Moskow, who is also the chairman of the Japan-American Society of Chicago.

Moskow says it’s hard to predict how long Japan’s  business sector will take to recover from this. As it does, there will be business opportunities in construction and other rebuilding efforts. Eventually, he sees business there stabilizing.

So, that means even the slowdown in production at American plants like Toyota’s could be made up later on.