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Asian auto makers sharply lifted their USA market share last month due to a trend towards smaller vehicles under the cash-for-clunkers scheme and consumers’ continuing concern about the health of General Motors and Chrysler. Toyota reported a 6.4% sales increase from a year earlier, bringing it within 21,000 vehicles of GM, which has held the # 1 spot for decades. The cash-for-clunkers scheme pushed GM’s sales up by 30% from July, but they remained a 5th lower than August 2008. Among other Asian auto makers, Honda’s sales reached an August record, while Hyundai reported a 47% surge and Subaru posted its best month ever. Read more

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Last week, US President Barack Obama thanked everyone from unions to executives for working to keep Chrysler LLC alive while blaming “a small group of speculators” for forcing the automaker into bankruptcy. “A group of investment firms and hedge funds decided to hold out for the prospect of an unjustified taxpayer-funded bailout,” Obama said yesterday in Washington before Chrysler filed for bankruptcy protection last Friday. Now, the US government and Chrysler plan to use bankruptcy to compel the dissidents, all secured creditors, to go along with a plan to create a more viable carmaker in partnership with Italy’s Fiat SpA. In lashing out at the holdouts, Obama is attempting to rally the public behind his efforts to rescue the automaker, said Stuart Rothenberg, a Washington-based political analyst. “In the real world, you have good guys and bad guys, and at the moment, auto executives, hedge-fund managers and bankers are all in the bad-guy category,” said Rothenberg. “He wants to be the guy who’s solving the problems and wants to make it clear who’s causing the problems.”

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Italian automaker Fiat SpA’s next project is a deal with Germany’s Opel, after a landmark alliance with US car maker Chrysler, Fiat’s chief executive said in an interview last Friday. Sergio Marchionne told La Stampa newspaper that Fiat also remained committed to Italy but needed to work with the government and unions on “structural problems.” “Now we have to concentrate on Opel. They are our perfect partner,” said Marchionne, who has emerged as a possible suitor for the German unit of General Motors Corp. (GM). Fiat sealed an industry-changing deal with Chrysler, the smallest of Detroit’s Big Three automakers, last Thursday. Fiat will take an initial 20% stake in Chrysler, which filed for Chapter 11 bankruptcy protection. “The objective is to strengthen Fiat and give Chrysler a chance to clean itself up,” he said. Even with the Chrysler deal, “I have never given up for a second my commitment to the Italian system,” said Marchionne, who has spoken of the need for consolidation in the car industry.

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The US Big 3 auto makers yesterday told Congress they would accept significant government controls over the US auto industry and its important restructuring decisions.

The move by Rick Wagoner (GM CEO), Alan Mulally (Ford CEO), and Bob Nardelli (Chrysler CEO) to accept broad oversight came in a hearing on Capitol Hill where members of Congress gave the auto makers a warmer welcome than they received previously.

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