NEWS BRIEFS FOR THE WEEK OF JUNE 15, 2006

Jan. 1, 2020
Seven Hondas Qualify For Tax Credit ... 2006 Vehicle Initial Quality Study Released ... Hybrids Expand Their Reach ... IIHS: ESC Reduces Fatal Crashes ... NATEF Becomes a Certified Charity ... and other headlines from around the industry.
NEWS BRIEFS FOR THE WEEK OF 
JUNE 15, 2006
Seven Hondas Qualify For Tax Credit WASHINGTON (June 1, 2006) - The Internal Revenue Service (IRS) certified seven American Honda Motor Company Inc. vehicles for tax credits under the requirements of the Alternative Motor Vehicle Credit as qualified hybrid motor vehicles.  The tax credit for hybrid vehicles applies to vehicles purchased on or after Jan. 1, 2006; consumers can claim a tax credit for as much as $3,400 for purchases of the most fuel-efficient vehicles. The hybrid vehicle certifications recently acknowledged by the IRS and their credit amounts are: * 2006 Honda Civic Hybrid CVT: $2,100.  * 2005 Honda Civic Hybrid (SULEV) MT: $1,700.  * 2005 Honda Civic Hybrid (SULEV) CVT: $1,700.  * 2005 Honda Insight CVT: $1,450.  * 2006 Honda Insight CVT: $1,450.  * 2006 Honda Accord Hybrid AT: $1,300, if updated control calibration is included. * 2005 Honda Accord Hybrid AT: $650 Starting in 2006, the tax credit replaces the tax deduction of $2,000, which was previously allowed for taxpayers who purchased a new hybrid vehicle before Dec. 31, 2005. The tax credit requires a different certification. Many currently available hybrid vehicles may qualify for this new tax credit. Consumers seeking the credit may want to buy early because the full credit is only available for a limited time. Taxpayers may claim the full amount of the allowable credit up to the end of the first calendar quarter after the quarter in which the manufacturer records its sale of the 60,000th vehicle.  For the second and third calendar quarters after the quarter in which the 60,000th vehicle is sold, taxpayers may claim only 50 percent of the credit. For the fourth and fifth calendar quarters, taxpayers may claim only 25 percent of the credit. No credit is allowed after the fifth quarter. Updated information for on these tax credits can be found on the IRS' Web site.(Source: IRS)2006 Vehicle Initial Quality 
Study Released
WESTLAKE VILLAGE, CA (June 7, 2006) - The way in which technology is integrated into new-vehicle design, particularly interior features and controls, is considered by consumers to be as important to quality as are defects and malfunctions, according to the J.D. Power and Associates 2006 "Initial Quality Study" (IQS) released today.  The IQS is an industry benchmark for new-vehicle quality and is measured at 90 days of ownership. For 2006, the study was completely redesigned to capture problems experienced by owners in two distinct categories: quality of design and quality of production (defects and malfunctions). Based on both of these quality considerations, the study finds that automakers can vary widely in their performance on these two components. 

Click on the image for a larger version.
IQS Rankings by Nameplate
(Photo: J.D. Power and Associates)

The 2006 IQS also provides rankings for automobile manufacturers, individual brands from automakers and assembly plants:

* Nameplate - Automakers with the fewest defects and malfunctions include BMW, Chrysler, Hyundai, Lexus, Porsche and Toyota. Brands with the fewest design problems include GMC, Hyundai, Jaguar, Lexus, Nissan and Porsche.

* Brands - Lexus and Toyota models continue to dominate initial quality rankings, capturing 11 out of 19 vehicles segment awards in 2006. Lexus models ranked highest in every segment in which they compete. Toyota captured five segment awards to remain as the quality benchmark for non-luxury vehicles. 

* Assembly Plants - Toyota received a total of four assembly plant quality awards for producing vehicles yielding the fewest defects, including the Platinum Plant Quality Award for its Iwate, Japan plant that produces the Lexus E330. 

2006 Initial Vehicle Quality RankingsVEHICLE SEGMENTTOP RANKED VEHICLESubcompact CarKia Rio / Suzuki AerioCompact CarToyota CorollaCompact Sporty CarMazda MS-5 MiataCompact Premium Sporty CarPorsche CaymanEntry Premium CarLexus IS 250/ IS 330Mid-size Premium CarLexus ES 430Large Premium CarLexus LS 430Premium Sporty CarLexus SC 430Mid-size Sporty CarToyota SolaraMid-size CarToyota CamryLarge CarPontiac Grand PrixCompact SUVHyundai TusconMid-size SUVToyota HighlanderLarge SUVToyota SequoiaMid-size Premium SUVLexus GX 470Large Premium SUVLexus LX 470Mid-size PickupFord RangerLarge PickupChevrolet Silverado LDVanChrysler Town & Country(Data source: J.D. Powers & Associates)Among North and South American plants, the General Motors Oshawa #2 plant in Ontario, Canada, which produces the Buick LaCrosse and Pontiac Grand Prix, received the Gold Plant Quality Award for a second consecutive year. 

Click on the image for a larger version.
IQS Assembly Plant Rankings
(Photo: J.D. Power and Associates) Magna Steyr's plant in Graz, Austria was awarded the Gold Plant Quality Award for Europe. The plant assembles vehicles under contract with several manufacturers, including DaimlerChrysler, BMW and Saab. The study provides details about the problems consumers reported to help OEMs better identify how to address them from a customer's, as well as automaker's, perspective: "New vehicles today are often packed with new technologies that unfortunately can be complicated and frustrating for the average consumer when their integration is not well executed," says Joe Ivers, executive director of quality and customer satisfaction research for J.D. Power and Associates. "In the eyes of consumers, design flaws can have as much of an impact on their perceptions of quality as can a defect. Yet, many manufacturers have tended to address quality solely on the plant floor without considering design factors. "Without considering both quality factors, one might fail to recognize vehicles that are, in fact, excellent in certain ways," adds Ivers. "For example, BMW vehicles have among the fewest defects and malfunctions, along with Toyota. But BMW approaches controls and displays in a way that creates some problems for customers, leading to more design-related problems overall than Toyota incurs. Automakers differ significantly in how they define quality and what parts of the organization they hold accountable for it. Clearing both critical quality hurdles is an accomplishment experienced by only a limited number of brands."(Source: J.D. Power & Associates)Hybrids Expand Their Reach  TORRANCE, CA (June 7, 2006) - Toyota Motor Corp.'s gasoline-hybrid Prius has propelled itself from a niche environmental car into the mainstream car market. Toyota has announced Prius surpassed one-half million worldwide cumulative sales, with 504,700 units sold as of the end of April. Of those, 266,212 have been sold in the United States, making up more than half of all the Prius models sold worldwide. The Prius launched in late 1997 in Japan, it was introduced in the United States in July 2000. A second-generation Prius was launched in the fall of 2003 with larger dimensions, new styling and Hybrid Synergy Drive. The resulting heavy consumer demand for the newer Prius triggered increased production, with more than 100,000 units being manufactured annually for the U.S. market alone. In 2005, calendar-year sales of Prius in the United States reached more than 107,000 units sold, making Prius the third-best selling Toyota passenger car after the Camry and Corolla.  (Source: Toyota)IIHS: ESC Reduces Fatal Crashes ARLINGTON, VA (June 13, 2006) - Researchers at the Insurance Institute for Highway Safety (IIHS) recently updated a 2004 study and found that electronic stability control (ESC) reduces the risk of fatal single- or multiple-vehicle crashes by 40 and 32 percent, respectively. The researchers estimate that if all vehicles were equipped with ESC, as many as 10,000 of the 34,000 fatal passenger vehicle crashes that occur each year could be avoided. With an ESC system, antilock brakes have independent braking capability. ESC adds sensors that continuously monitor how well a vehicle is responding to a driver's steering wheel input. These sensors can detect when a driver is about to lose control because the vehicle is straying from the intended line of travel - a problem that usually occurs in high-speed maneuvers or on slippery roads. In these circumstances, ESC brakes the individual wheels automatically to keep the vehicle under control. When a driver makes a sudden emergency maneuver or, for example, enters a curve too fast, the vehicle may spin out of control. Then ESC's automatic braking is applied, and in some cases, throttle is reduced to help keep the vehicle under control. The results of the IIHS studies demonstrate that significant reductions in serious crash risk are reflected in insurance claims and premiums. According to a new analysis by the Highway Loss Data Institute, an affiliate of the IIHS, losses under collision coverage are about 15 percent lower for vehicles with ESC than for predecessor models without it. (Source: IIHS)NATEF Becomes a Certified Charity LEESBURG, VA (June 13, 2006) - The National Automotive Technicians Education Foundation (NATEF) is now listed in the non-profit directory for the eBay Giving Works program. The program allows sellers to help causes important to them by listing an item on eBay and donating part or all of the final sale price to one of its approved non-profit organizations.  By listing items on eBay and donating some or all of the proceeds to NATEF, sellers can help improve automotive service education. Donations can range from 10 percent to 100 percent of the final sale price; there is a $10 minimum donation if your items sell. Since 2000, more than $74 million has been raised for charity from listings sold on eBay worldwide.  "The eBay Giving Works program will allow public-minded shop owners and technicians alike to support NATEF's efforts to provide a steady stream of entry-level technicians," says NATEF President Bill Kersten All eBay Giving Works listings stand out with a charity icon, and donation information is displayed in the item description, instilling buyer confidence and trust, says eBay. Charity listings also receive additional visibility through specialized search functionality. Donations that result from eBay Giving Works listings are tax-deductible, with donors receiving a receipt after the sale. Click here to learn more about the program's donation policy, and more information is available at givingworks.ebay.com/sellerFAQ/.(Sources: NATEF, eBay)DENSO Launches Summer 
Tune-Up Campaign
LONG BEACH, CA (May 31, 2006) - DENSO Sales California is launching a summer sales campaign "Tune In And Tune Up" to all DENSO warehouse distributors, jobber/counterpersons and service technicians. The program runs through Sept. 30, 2006 and rewards the jobber/counterperson and professional service technician by offering them an opportunity to win electronic prizes for selling First Time First Fit brand spark plugs, oxygen sensors, ignition wire sets and fuel pumps. The program also offers warehouse distributors an incentive for qualified orders of First Time First Fit brand spark plugs, oxygen sensors, ignition wire sets and fuel pumps they purchase. In addition, DENSO is offering a free DENSO Motorsports Cap to those who preregister. For additional information about DENSO's Summer Tune In & Tune Up campaign, go to www.densoaftermarket.com or contact your DENSO Sales Representative.(Source: DENSO)SBA Extends Hurricane Disaster 
Loan Deadlines 
WASHINGTON (June 2, 2006) - The U.S. Small Business Administration's (SBA) Administrator Hector V. Barreto announced that small business owners dealing with financial losses in the aftermath of Hurricanes Katrina and Rita have more time to apply for an SBA Economic Injury Disaster Loan. The new deadline for small businesses in the areas affected by Hurricane Katrina is June 28; applications in the Hurricane Rita disaster-affected areas will be accepted until July 26. The Economic Injury Disaster Loan filing deadline remains July 24 for Florida business owners affected by Hurricane Wilma.  "After consulting with the business community, local officials and our congressional delegation, we have decided to extend the deadline for small businesses that may want to apply for economic injury disaster loans in the Gulf Coast," says Barreto. "It's a top priority for us to help small businesses recover from last year's devastating hurricanes and I am pleased that we're able to give them extra time to submit an application."  Small business owners in Louisiana, Mississippi, Alabama, Texas and Florida may apply for SBA's Economic Injury Disaster Loan to cover ordinary expenses the company would have been able to handle if the disaster hadn't occurred. The loan limit is $1.5 million, at a 4 percent interest rate with terms of up to 30 years.  To apply, small businesses can visit SBA's Web site at www.sba.gov/disaster to download an application. They can also call the Agency's Customer Service Center toll-free at (800) 659-2955 or send an e-mail to [email protected] to obtain an application. (Source: SBA)AMI Introduces Online Course Format BEDFORD, TX (June 1, 2006) - The Automotive Management Institute (AMI) announced today that its Automotive Service Management Course is now available in an online format on the organization's Web site. This 18-credit course is required for completion of the Institute's Accredited Automotive Manager (AAM) designation. This is the first AMI course to be offered online. It also is available to students in a self-study print format.  "Our goal is to provide easy access to AMI education. This new online format is user-friendly, interactive and easy to follow," says AMI Executive Director Toni Slaton, AAM.  "This format gives students the flexibility and convenience to take the course when it fits their busy schedule." adds John Francis Jr., AAM, AMI Board of Trustees chairman. "Students can take the course in one setting or complete it in modules to best accommodate their needs." The Automotive Service Management Course is an introduction to three of the most critical business development skills: sales and marketing, personnel management and financial and business management. The sales and marketing section addresses the challenges of finding and keeping a solid customer base. "Personnel Management" dissects the hiring process and helps pinpoint applicant recruitment and selection criteria. This segment includes writing a job description, finding qualified applicants and selecting the right employee. The financial and business management segment provides an understanding of financial statements and how productivity and efficiency affect the bottom line. A post-course exam is required once all modules are taken.  To learn more about the course, visit the Self-Study section of the AMI Online Catalog. AMI recommends that students use a high-speed Internet connection to take the course as it includes multimedia and interactive features.(Source: AMI)Renault Showcases Fuel Cell, 
Onboard Reformer Research
LYONS, FRANCE (June 13, 2006) - Renault will be presenting the progress it has made in fuel cell research at the 16th World Hydrogen Energy Conference, held June 13 to 16, in Lyons, France. The exhibits will illustrate Renault's decision to opt for vehicles powered by fuel cells with on-board reformers in order to supply hydrogen energy to the automobile.  This technology directly produces the hydrogen on-demand and on-board, solving the problem of very high-pressure or cryogenic storage. Since 2002, Renault, Nissan and Nuvera Fuel Cells have been working together on this project, which, they say, can be used immediately without waiting for a hydrogen distribution network to be established.  Four exhibits will be on show:  * The reformer - The prime purpose of the reformer is to transform the liquid fuel into reformate, a hydrogen-rich gas that can be used to supply the fuel cell. The process has six distinct stages. First, the cracking phase breaks down the long hydrocarbon molecule chains into simpler molecules: hydrogen, water, carbon, etc. In the next five stages, the gas is purified until it is ready for use with the fuel cell.  * Fuel cell - As the fuel cell generates electric power by combining hydrogen and oxygen, the water byproduct is then returned in a closed circuit to the reformer that needs water to operate. The water produced by the fuel cell is reinjected into the system.  * Electric motor - The electric power generated by the fuel cell is transformed to the appropriate voltage by the power electronics and then drives the electric motor.  * A multiple-fuel tank - Because the reformer can run on gasoline (petrol), diesel and ethanol, a special fuel tank has been designed that can contain the different types of fuel. This option was chosen to reduce concerns about the future availability of hydrocarbons. It also means that motorists can choose the cheapest available type of fuel.  (Source: Renault)

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