“Automotive slowdown drags navigation market - Electronic Engineering Times” plus 4 more

Automotive slowdown drags navigation market - Electronic Engineering Times
Paired Trade: Buy Dorman Products, Sell O'Reilly Automotive - Seekingalpha.com
Buick remains popular with China's upper-middle class - Detroit Free Press
Employees aim for up to 5 percent stake in VW - CNBC
Man accused of stealing $500,000 in goods from former employer - Lexington Herald-Leader

Automotive slowdown drags navigation market - Electronic Engineering Times

Posted: 30 Aug 2009 09:57 AM PDT

It has been a challenging time for the global automotive market with the lean sales extending to such related systems as OEM automotive navigation devices. Yet things should be picking up as the relentless advance of in-car electronics continues to push consumer expectations for car navigation.

"There has been no escaping the impact of the global automotive meltdown, not even for a relatively new consumer product that is still very much in the proliferation phase, such as the in-car navigation system," says Kevin Furr, senior analyst at IMS Research. He noted that worldwide sales of display-based OEM navigation systems are forecast to fall 5 percent, to some 8 million units, for the year 2009.

Yet it could be worse—the predicted global decline in light vehicle sales is some 17 percent for 2009, according to Furr. "The glass half-full scenario here is that although vehicle sales have been in decline, the fitment rate among those vehicles of OEM navigation systems has continued to increase, along with the number of vehicle models and global regions in which navigation is offered. That bodes well for navigation suppliers as vehicle sales bottom out."

Furr cited these trends in a newly released study on the global market for automotive navigation systems. A related emerging trend is the increased implementation of connectivity. "While the in-car PC concept that was once a topic of speculation has never gained much traction, bits and pieces of connectivity continue to make their way into the car to provide traffic feedback, map updates and portal services," he added.

This may prove a key area of growth; Furr said that global sales of such OEM connected navigation systems will double by 2012.

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Paired Trade: Buy Dorman Products, Sell O'Reilly Automotive - Seekingalpha.com

Posted: 30 Aug 2009 08:53 AM PDT

This is the 9th in a series of ideas where I contrast a cheap security with an expensive one that otherwise shares some characteristics. So far, I am 6 for 8:

	BUY	SELL
	MPR	NLC
13-Mar	7.30	11.99
28-Aug	9.78	17.52
	34.0%	46.1%	-6.1%

	JNJ	AGN
17-Apr	53.05	49.49
28-Aug	60.29	55.10
	13.6%	11.3%	1.2%

	COLM	UA
1-May	30.36	24.00
28-Aug	39.94	24.30
	31.6%	1.3%	15.2%

	BCR	ISRG
8-May	73.52	158.77
28-Aug	80.31	224.90
	9.2%	41.7%	-16.2%

	EZPW	AAN
5-Jun	13.09	32.85
28-Aug	13.46	26.64
	2.8%	-18.9%	10.9%

	SCVL	PSS
19-Jun	12.04	14.38
28-Aug	16.21	15.84
	34.6%	10.2%	12.2%

	HRL	DIN
9-Jul	34.09	31.80
28-Aug	36.89	21.91
	8.2%	-31.1%	19.7%

	AKAM	NTAP
14-Aug	18.01	23.59
28-Aug	18.11	23.32
	0.6%	-1.1%	0.8%


		Average:	4.7%

For reference:

3/14: Buy Met-Pro (MPR), Sell Nalco Holding (NLC)
4/18: Buy Johnson & Johnson (JNJ), Sell Allergan (AGN)
5/3: Buy Columbia Sportswear (COLM), Sell UnderArmour (UA)
5/10: Buy C.R. Bard (BCR), Sell Intuitive Surgical (ISRG)
6/6: Buy EZCORP (EZPW), Sell Aaron's Rents (RNT)
6/20: Buy Shoe Carnival (SCVL), Sell Collective Brands (PSS)
7/9: Buy Hormel (HRL), Sell DineEquity (DIN)
8/15: Buy Akamai (AKAM), Sell NetApp (NTAP)

Today's trade idea involves two companies that are both in my watchlist. I wrote positively about O'Reilly (ORLY) last year, but it has almost doubled since then as the thesis has played out. I wrote about Dorman Products (DORM), a major supplier to ORLY and other auto parts retailers, in February and then again in May. It had a huge run, and I sold the position. I added it back very recently in my Top 20 Model Portfolio and continue to like it here. Let's go to the tape:

I probably shouldn't pick too much on ORLY, as I believe it was hit along with peers on the Cash for Clunkers program that took a small amount of potential customers off the road. I had been concerned that DORM was getting squeezed by its customers, but the last two reports tell me that pressure is abating. If ORLY works, DORM should work a lot better. DORM has a similar growth profile, a superior financial structure and a much lower valuation. My analysis doesn't include the off-balance sheet lease exposure of ORLY either.

Disclosure: Long DORM in a portfolio I manage

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Buick remains popular with China's upper-middle class - Detroit Free Press

Posted: 30 Aug 2009 04:45 PM PDT

(2 of 3)

In China, Buick experienced spectacular sales growth in the early 2000s, with sales nearly doubling every year from 2001 through 2003.

Buick benefited from the lasting reputation the brand carried as a high-status vehicle. The automaker built on that image with new models to address a range of tastes in China's upper-middle class.

GM introduced the luxury Enclave crossover to the Chinese market. It also sells a Buick minivan, the GL8, which can be found at airports and is being used to transport workers. For young families, Buick sells a compact sedan called the Excelle that is also offered as a hatchback. The Excelle makes up about 60% of Buick's sales in China.

"We not only meet their needs, we also meet their wants," Joseph Liu, executive vice president of Shanghai GM, said of Buick's customers.

In June, GM sold its 2 millionth Buick in China. It took the automaker eight years to sell a million Buick cars in China, but only three years to sell another million.

Models freshened

Despite that sharp growth, Buick's popularity has tempered as GM ramped up sales of Chevy and Cadillac in China.

Last year, Buick's sales declined nearly 15.7% to 280,102 vehicles, as even China's automotive market felt the pinch of the global recession and some of Buick's models needed freshening.

Last year, Buick ranked seventh among the best-selling brands in China, with 5% of sales, behind Hyundai. Volkswagen was the best-selling brand in China, according to J.D. Power and Associates.

Still, Buick's leaders in China expect the brand's sales to increase by 30% this year. Through June, Buick's sales jumped 34%, as sales of the new Buick Regal and Enclave picked up and Buick introduced its new LaCrosse.

David Shi, Buick China's general director, is both cautious and confident.

"You cannot expect every year" to be "a good year," Shi said, adding that 2009 would be "very exciting."

Seeking younger buyers

Buick's success in China stands in stark contrast to the brand's performance in the United States.

Buick's U.S. sales fell 43% since 2006 to 137,197 vehicles last year. The company offers only the LaCrosse, Lucerne and Enclave in the United States.

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Employees aim for up to 5 percent stake in VW - CNBC

Posted: 30 Aug 2009 04:52 PM PDT

FRANKFURT (Reuters) - The roughly 370,000 employees of Volkswagen <VOWG.DE> and Porsche are striving initially to acquire a stake of up to 5 percent in the automotive group, VW's labor chief told a German newspaper.

"I don't know how much we will end up with. It certainly won't be 10 percent overnight, but between one and five percent to begin with," Sueddeutsche Zeitung quoted Bernd Osterloh on Saturday as saying.

It was not clear yet how the employees would finance the purchase of their stake, the paper said.

Volkswagen -- Europe's biggest carmaker -- agreed to buy a 42 percent stake in the sports car unit of debt-ridden Porsche SE <PSHG_p.DE> earlier this month.

It will pay up to 3.3 billion euros ($4.7 billion) this year for the initial stake in the unit, Porsche AG, paving the way for the creation of an "integrated" automotive group by the end of 2011.

To finance the purchase, Volkswagen plans a capital increase of preference shares in the first half of 2010.

(Editing by Mike Peacock)

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Man accused of stealing $500,000 in goods from former employer - Lexington Herald-Leader

Posted: 30 Aug 2009 03:34 PM PDT

"It was quite a sight," Cynthiana Sgt. Wilber Gross said Sunday.

Helton, 53, has been charged with several felonies, including receiving stolen property worth more than $10,000, trafficking in controlled substances, trafficking in a controlled substance within 1,000 yards of a school, and altering firearms.

He was being held Sunday at the Grant County Detention Center in Williamstown on a $40,000 bond.

During the search Friday, police said they first found thousands of yellow gloves in his garage, all reported missing from TI Automotive, where Helton had worked.

Helton was part of a layoff in January at the supplier of automotive fluid storage and delivery systems for cars and trucks, police said.

Also discovered in Helton's garage were numerous drill presses, nuts and bolts, various lubricants, and a variety of auto supplies.

In a deadbolt-locked closet in the house, police said, were narcotics, guns, more than $2,400 in cash and 17 boxes of rolled pennies worth about $6,000.

Police said Helton allegedly had made trips to Florida and used a fake medical test to get prescription drugs. He allegedly sold the drugs on the street.

Gross said he did not know why Helton had not gotten rid of all the property. "He apparently was saving it for some reason."

The stolen property eventually will be returned to its rightful owners, police said.