According to reports from Turkish news agency Sabah, Ford is to start marketing the Transit Connect in the United States. Initially, supply will come from the Kocaeli plant, home of the JV between Ford Otosan and Koç Holdings, and Turkish-built Connect models will be made available to US customers during 2007. US production of the Transit Connect is due to commence in 2009.

Interest in the one tonne sector seems to be developing apace in the US. Chevrolet's HHR panel van is not far away from production, whilst Dodge recently showcased a van version of its Nitro SUV. Trailing a possible Dodge Vito we wonder?

The news that both Paccar and Isuzu are to develop new manufacturing facilities in the US comes at an interesting time.

Isuzu is to establish a plant in Birmingham, Alabama, and, whilst Paccar is rather coyer as to its plans, we’d put some money on it opting for the same state.

No shortage of hybrid news kicking around today. There’s an announcement here concerning Freightliner’s pitch for a piece of the medium-duty hybrid market, whilst here is a tale about Mack’s take on the genre. We assume that the Freightliner variant is closely reelated to Fuso's Eco Hybrid. We don't make any assumptions about Mack and Volvo, because our conversations with the US end of the Swedish OEM tend to be a touch stilted.

The news that Ford has filed suit against Navistar shouldn’t come as a surprise; the Warrenville, Illinois-based manufacturer has been a contender for our favourite basketcase OEM award for a time now. Aided in part by the fact that its previous accountants have had some difficulty adding up, its financials are a mess, and its strategy – whilst commendable from the perspective of an industry attempting to globalise – seems to have been leading it nowhere.

I’ve long harboured the suspicion that George W. Bush isn’t quite right. And his grand scheme for reducing US dependence upon oil serves merely to confirm this.

For a company to lose more in a year than the GDP of Jamaica is a rip-roaring achievement. A big hand, then to Ford, which has announced 2006 losses of $12.7 billion. Hello 2007, hello Chapter 7?

There really is very little you can say about this, beyond wishing Ford employees well as they – one assumes – scan the sits vac column. Can you come back from a $12.7 billion loss? We think it is unlikely.

Is there a potential buyer out there? Leaving aside the fact that selling a deal involving a company that loses more than four hundred dollars every second might be a tough one to all but the most laid back of bank manager, we can’t see it. Ghosn took a look and backed away; maybe the Chinese have taken a peak, and Tata is lip-locked with Fiat. Maybe there’s an OEM out there, but, to make an offer for Ford as it stands, it would have to be truly out there.

Two questions therefore remain. Will this now become a (more) political issue in the US? Can the Bush administration afford to let an icon of modern America fall? The ramifications to the US economy would be dire.

But, can Washington produce the corporate equivalent of a Marshall Plan? It would set an awkward precedent to say the least.

As such, the other question has to be the scrap value of the Blue Oval.

GM may be looking for a buyer for its Allison Transmission division, according to this statement, suggesting that the 07 slowdown is now really beginning to focus some minds.

Good to see that Sergio Marchionne is getting with program and talking about Iveco and possible mergers, as per the FT this morning.

The Freightliner brand is to leave its Portland home, ending a 60 year relationship with the city.

600 more jobs to go, according to this report here.

There’s an interesting report here concerning Navistar’s continuing woes.

Tomorrow – Tuesday – it meets with NYSE officials with a view to postponing its mooted delisting from New York’s major exchange. If it gets dumped, then Navistar shares will be moved to the Pink Sheets.

Paccar’s 2006 results are in, and, as we have come to expect from the Bellevue, Washington-based owner of the DAF, Kenworth and Peterbilt brands, they’re good.

But ......

There is a TV show that airs in the US – and – for all I know, the UK too – called ‘Dirty Jobs’. And it is an apt description; some character with cable TV dentistry wanders around the place, engaging in the sort of jobs that most of us would find easy to pass up.One episode and he 's mopping out the modern day equivalent of the Augean Stables, the next he's John Prescott’s Proctologist. You get the idea.

What are we to make of the news that ArvinMeritor has sold its Emissions Technologies Group to a bunch called One Equity Partners?

And so to AB Volvo's results for 2006, which, in a soaring market, could hardly have been expected to be anything other than pretty damn good.

A key element of Ford’s survival strategy has been announced.

It is going to revive the Taurus, a model name dropped last year, and apply it to the Five Hundred model; itself selling in units of one or two per eon.

Oh dear. Last year, Ford lost over $400 per second. How will the re-adoption of the Taurus reverse this trend?

I don’t know, but will instead take this opportunity to defer to my literary hero, genial Floridian serial killer, trivia nut and all-round good egg Serge A. Storms who posits:

“The introduction of the Hummer limo is an airtight case that your civilization has finally become bullshit on stilts.”

That the Taurus is to be reintroduced merely serves to underline this entirely appropriate assertion.

We blogged this particular tale of woe a week or so back, and now it seems that Navistar has been given the finger by the NYSE.

This is bad news. It's probable that institutional shareholders will get shot of holdings in the Illinois-based OEM, leading to a depressed stock value, increased cost of borrowing and all round gloom. Navistar will appeal, but to what end it's difficult to see.

But this move doen't just impact Navistar. Losing a NYSE spot will inevitably put the entire CV business - OEM and Tier 1 - under the analysts' spotlight, and, with prognostications of doom already much in vogue, this is something the truck industry really did not need to happen at the moment.

Whatever. Navistar is now up for the taking. Which OEM will move first?

Over the weekend, we couldn't help but notice that GWB and the neocon gang have renewed their efforts to drag Tehran into the fiasco that is the Middle East. US television has been full of tales of Mullahs under the bed and the like, and so it seems that another bout of unpleasantness is about to kick off in the region.

What does this mean for those automotive companies with an interest in Iran? Volvo has a NASDAQ listing and uses SAIPA as a regional producer. MAN has just started to do some serious business therein, and, whilst not having a NYSE presence, does have strong links with Navistar, a not unimportant supplier to the US military. Of course, Navistar has recently been kicked off the NYSE, but the ailing US OEM probably doesn't need an injection of geopolitics into its already awkward existence.

If this goes the distance, and Bush - of whom it may be observed, has, by his handling of US Middle Eastern policy achieved the impossible, and made the MAN-Scania debacle look reasoned and well-thought out - decides to press the bang button, then one or two European OEMs may find themselves with a problem or two. We've been here before, and it's good to see that CNN has begun to catch on too.

More talk of DaimlerChrysler dropping its last two syllables here.

In truth, we rather like the idea of DC spinning off its truck business into a separate company. It makes money – even with Fuso – and could probably do a better job by itself than in its current position - which necessitates having to pony up to support the other ailing bits of the DC empire.

Such a move has been spoken of in the past – and at some length – but we wonder if the time isn’t now right to turn words into actions.

Is DaimlerChrysler considering the sale of Chrysler to GM? According to reports from Reuters, which, in turn refer to German press reports, conversations between the two are now ongoing.

This is somewhat bizarre. Although GM has pulled itself back from a very real chance of bankruptcy, the fact remains that it is still in a parlous state. When compared to Ford, GM does – it must be said - look to have a robust future, but any other comparison would not be to the General’s advantage.

We cannot see GM’s already long-suffering shareholders standing for this, unless the price was very keen indeed. Like cent on the dollar keen. And, were a deal to be struck, how would DC’s shareholders feel about absorbing what would be a big loss. These financial considerations pale into insignificance when the damage to Daimler’s prestige is considered.

Once again, we ask the question as to why the truck business is not being considered for divestment. Not only is it profitable, it is also being held back by the problems within the rest of the empire. If GM does buy Chrysler, then offers of magic beans will be flooding into Rick Waggoner’s office. It seems most unlikely. But a separate DC truck business makes an increasingly large amount of sense.

Here is an interesting little snippet of news from the ISNA agency in Tehran, which suggests that, far from exiting the Islamic Republic, DC is staying firm in the Iranian CV business, and is looking to develop a new truck product with its Iranian partner, Iran Khodro Diesel.

With all the loose talk concerning and end to the Chrysler relationship – which, after all, is the primary reason the company has a NYSE listing and is therefore concerned about doing business with countries that upset GW Bush – does this point to anything? Of course, the question could be asked about a divested truck business. Would DC CV, which seems to be aiming to produce an increasing number of CVs for the NAFTA market outside the US need a NYSE listing? Just a thought. And here's another one to chew over: one of the larger Merchant Banks has put a €30 per share value on a divested CV operation. Zetshce needs cash to sort Chrysler out. Of course, if this was seen as a step too far, how about a divested CV components business; a brand - Detroit Diesel - already exists.

Something is going to happen here: the only thing that is beyond question is that the current DaimlerChrysler is beginning to look untenable. This DC release suggests that fundamental changes are afoot. Whether they will impact upon the truck or the car business remains to be seen.

One bit of good news in all of this - for DC at any rate - is this news that a German court has dismissed one law suit against against the company. There are, however, one or more out there, and we suspect that Stutgart's lawyers are going to be working a full week for the foreseeable future.

Another thought on the Chrysler business.

This is a master class in PR and spin. The first mention of a Chrysler divestment came around four months ago, when DC released its Q3/06 results. We return to our views as blogged then.

Here is an analogy. If you surrender to an anaesthetic in the honest-held belief that your arm is going to be amputated, and then awake to find that you’re only missing a finger, then how good are you going to feel? A finger – pish – at least you still have your arm.

The spinmeisters in Stuttgart are, we reckon, fully in control of this one. They have placed a vertical wind up the UAW – get into line or we’ll sell you to the Chinese – or – even worse – Ghosn – and have also managed to get most of the media running in directions as varied as Chrysler being sold to GM or turned into a fast casual restaurant chain. Divide and rule, and get people to look the other way .........

If nothing else, our estimation of the DC PR machine has been ratcheted up a notch or two. There is news here, but whether or not it is the disaster that a divestment of Chrysler would be seems in doubt. A less earth-shaking tale looks likely to emerge, and we wonder – again – if it might not involve trucks.

The Bush administration is stepping up its efforts to isolate the Ahmadinejad regime in Iran.

Adding fuel to the long-running hostilities between Washington and Tehran, this week a US House of Representatives panel approved a bill to expand sanctions against US companies and non-US oil and gas companies that invest in Iran. Presumably, it can only be a matter of time before someone in Washington works out that trucks have a potential military use, at which point things will get very messy for the likes of Volvo.

Of course, once GWB has sorted out Iran, he may start looking at other beacons of democracy. China, Israel, Pakistan, Saudi Arabia - all of which are some way from being shining examples of Truth, Justice and the American Way - must be quaking in their boots.

Or not.

The Chrysler tale gets yet more bizarre. Last week, Dr. Z announced plans to cure the patient. This – to our simple way of thinking – indicates that there may be a solution to Chrysler’s ills. It loses money, but, then again, it’s a US car manufacturer, and so one would expect it do just that.

In the last couple of days, both GM – itself a star performer in the money loss stakes – and Hyundai – the latest OEM to see its Chairman do time – have both been wheeled out as potential buyers for Chrysler. Now, Marketwatch is reporting that JP Morgan is lining up an auction, with a valuation set at between – (minus) €3 billion and + (plus) €6 billion.

None of this makes any sense. Why would DC revert to the status of regional vehicle manufacturer? Of course, MB does have a significant US presence, but a D without C loses a large lump of mass market business. A sale such as that under review by JP Morgan would also suggest a big hit in terms of the eight year relationship – DCX is rumoured to have cost rather more than £6 billion to put together.

Once again, we come back to the fact that Zetsche has said that the thing is mendable. If it is, then surely doing just that, rather than offloading it to another sickward resident is the smart thing to do.

Spin, we say. All spin. Let's see a sale of some of the truck business instead. Far better idea.

Here is a well-written, considered article that deals with globalisation and the automotive sector.

To our mind, it offers yet another reason to consider the US auto business as being very much a sunset industry.

News here confirms that Scania will take over the GM - formerly Saab - Powertrain facility in Sodertalje.

This move has been reasonably well trailed, but its confirmation serves two purposes. On the one hand, Scania's XPI Technology - born as a result of a JV with Cummins now has a European as well as a NAFTA home. The mention of production coming on stream in 2009 also adds weight to Scania's previous assertion that it will be in a position to offer a post Euro 5 compliant EGR engine before the Euro 5 deadline. For what purpose, we know not, but presumably it gives a warm feeling to some marketers in the frozen North.

But the news is also one more nail in the MAN-VW merger coffin. Scania is ploughing a verticalised furrow, and this is but one more example of this. We cannot see investment of this kind being bundled in with either MAN or VW - both of whom have some catching up to do. But we do wonder how interested Hino is in the goings on therein.

It had to happen sooner or later.

Last week, just about every corporate entity on earth denied being interested in Chrysler.

But now, courtesy of Marketwatch, comes the news that GAZ might be tempted. As we know, GAZ is a fast growing and well-financed Russian OEM with global aspirations, and also owns LDV. It is also the employer of Martin Leach esq.

The prospect of the serial litigant Leach doing business with the irritable UAW is one that we find most alluring. If this does come to pass, ML won't have CFO David Eggers to rely on. He's jacked after just 10 months in the job.

Today - Monday - is the day on which Freightliner has to tip up £250 / €372 / $491 million to MAN under the terms of the interim award made by Lord Justice Martin Moore-Bick, who found that MAN had been shafted over the sale of ERF. If Freightliner fails to pay up, it loses its right of appeal in the UK courts.

US Judge Kathleen Dailey awarded more than $850 / €644.8 / £432.69 million to MAN in the same case on 15 December last year. The lawyers are still arguing over the specifics of that one. We reckon that this is the biggest award of 2006, but presumably one unlikely to find a prominent spot on Zetsche's mantelpiece.

One thing that continues to confuse us is this. MAN acquired ERF before Freightliner acquired Western Star. Both were bought from Australia's best-known dustman, Terry Peabody. Presumably the financial statements were the same in both cases. So where's the news about DaimlerChrysler going after Peabody with a vengeance?

Of course, to a certain extent, Freightliner has had the last laugh. A Portland jury awarded the $850 million to MAN. At which point, Portland-based Freightliner responded with a terse Hasta Luego, your job's been moved to Mexico. Amigo.

Oh well.

Navistar's spat with Ford seems to be getting nastier. Here is a Press Release that indicates an unwillingness to continue supplying Ford with the Power Stroke diesel engine - as fitted to the F250 and F350 pick up trucks - until Ford 'honours the terms of the agreement'.

Naturally, it would be just wrong of us to point to the fact that Ford's - which lost a magnificent $400 per second last year - most profitable product is the F Series, and that it has - or had - a 50 per cent market share in the segment driven by the Power Stroke.

Over at Jalopnik, they're being very caustic. We'll sumarise:

According to Bear Stearns, losing more than one month's production would be very nasty. Like an annualized $11.6 billion nasty. Making mention of the fact that Super Duty ads were aired during the recent Super Bowl - at a not insubstantial cost - would also be unkind. Advertising a product you don't have at just about the highest ad rates on earth? Priceless.

Whatever, Ford doesn't have a diesel engine, and Navistar doesn't have its biggest customer, a situation that must be most unpleasant for all concerned.

We receive the following email from Freightliner:

"We have notified the UK judge that we will not pay the interim award."

We'll say no more at this point, but merely hope that both sets of lawyers - Clifford Chance and Slaughter & May are strapped in tight. MAN vs Freightliner looks set to become a bumpy ride.

The Daimler-delete-as-applicable debacle develops apace.

We now know that VW, Nissan, GAZ and Fiat aren't interested, and that DZ could - allegedly - be in the market for a bit of GM, were GM to take on a lot of Chrysler. FAW might be keen, as might Magna.

In other news, DC AG's supervisory board has approved the framework of a limited partnership that will see China's Chery Motor Co. build the cars in China, which will - no surprise here - be sold in North America and Western Europe under the aegis of its Chrysler Group brands. In blunt terms, Chrysler isn't for sale, but its North American jobs are. As we said before, this is all about big spin prior to the smaller announcement. Quite how Chinese-built Chryslers will play with an increasingly isolationist US consumer is a moot point, but it should be some fun to watch.

We believe - and have done from the start - that this whole business has been more about spiking the UAW's guns than anything else. There is one single over-riding reason why Daimler cannot afford to be without Chrysler, and it comes from the energy business.

Here is news of the biggest leveraged buyout yet seen, in which Kohlberg Kravis Roberts & Co (KKR) and Texas Pacific Group have come together to buy out Texas power company TXU in a $43.8 / €33.07 / 22.32 billion deal. This eclipses the previously biggest similar deal - the $25.1 billion takeover of RJR Nabisco, also by KKR, completed in 1989 - by not too far shy of $20 billion.

These are big numbers, and suggest that the Private Equity Corps are now unstoppable. If they want it bad enough, they'll buy it, and money is not a problem.

A few days ago, a number of PEC's - Apollo Management LP, Blackstone Group, Cerberus Capital Management LP and the very charming Carlyle Group - were all mentioned as possible Chrysler buyers. Unlikely, we think.

But, a Daimler without the encumbrance that is Chrysler would be a very different deal. The truck group - profitable despite the best efforts of Fuso would be on the block before the new owner was behind his desk, money would be banked and DC would - we believe - revert back to a regionalized producer of rather fine automobiles. Volumes down, cachet - and profit up. Why did Daimler-Benz buy Chrysler in the first place? Globalization, naturally, but it's entirely possible that a buy or be bought calculation was going on in St Schremp's mind.

Chrysler is a very good spoiler against possible PEC ambition. It is - in its present form - the corporate equivalent of gangrene, and the smart thing to do with gangrene is not to get it. Even smarter is not to pay for it. Which no sane PEC would. So Chrysler is Daimler's guard dog, a radioactive rock that no one wants to put in their pocket.

And that is why - we believe - it's going nowhere.

Here's some happy news for Cummins. For the third year in succession, it has seen turnover in its Chinese business top $1 billion. According to the report, the US engine builder now makes 50 per cent of its money away from its domestic market - probably a good thing given the current state of the NAFTA Truck business - with India and Russia coming second and third to China in terms of value.

How does Cummins celebrate? It buys out partner Tata's stake in the Tata Holset JV. Does this mean Tata is looking elsewhere for engine assistance?

Maybe the fog has just lifted a bit in terms of the Iveco-Tata relationship.

This piece in the Detroit News catches the eye.

It looks like the US automakers are facing a big bill - $100 billion or so over seven years - in order to fall into line with the Bush administration's decision to improve US vehicle fuel efficiency.

Detroit hasn't been a very happy place for some time. Looks like it just got a lot more miserable.

The Ford-Navistar Power Stroke engine dispute is getting yet more unpleasant.

News here suggests that it will begin idling the Louisville, Kentucky plant where the F Series truck is made. And, just for good measure, in a SEC filing yesterday, Ford's North American restructuring costs have increased by $1.2 billion to $11.2 billion.

Still, it's only money.

Now the judiciary has got involved in the Ford-Navistar dispute.

Earlier today, Oakland County, Illinois Circuit Judge John McDonald granted Ford's motion for a TRO requiring Navistar to resume producing and shipping diesel engines to the truck plant in Louisville. However, the same judge also ordered Ford to pay Navistar for all engines received.

Suggesting that there's a bit more life in this dispute yet. The real question has to be one of which of the protagonists can afford to blink first? NYSE-delisted Navistar, the innumerate engine builder, or $12 billion plus in-the-hole Ford, the soon-to-be-on eBay relic. The March 7th hearing should be a good one, and we trust both sets of learned friends have negotiated cash fees in advance.

One of the stranger comments to come from Iveco executives during today's launch of the new Stralis was the assertion that "We didn't need to do this."

Here's news from Freightliner CEO Chris Patterson, who posits that the market will boom in 2008, exceeding that of 2006.

Which market? Surely he is not talking about the post-nuclear holocaust landscape that is the US - it is on its knees, the economy is soon to be acquainting itself with depths previously unplumbed, and everything is very far from nice.

A booming truck market? Presumably he refers to the major market that is St Helena. Or the Aleutians. But not, we fear, the United States.

Bendix CEO Joe McAleese, who regards 2007 as being a year that the business will want to forget, does not share Freightliner boss Chris Patterson's optimism about the US truck market. P