General Motor’s has been building a new facility in Brownstone Township. This facility is where GM employees will weld together T-shaped packs for their batteries. The batteries are lithium ion batteries that will come from South Korea. Developing batteries is an important step for GM in its quest to become a leader in electric vehicles. This will be the first lithium ion battery manufacturing facility in the United States.

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VW will be investing $4 billion to build a vehicle assembly plant in the United States. It will be located in Chattanooga, Tennessee. Volkswagen has plans to develop at least two new models for sales in the U.S. This information was shared by Stefan Jacoby, president and CEO of Volkswagen America.

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With automotive industry sales off by 32% for the year to date, the “clunkers” program has boosted July sales to only a 12% decrease. The $1 billion fund originally created for the “clunkers” program was depleted in the first week with dealers submitting 245,000 applications to the federal government for approval. Congress added an additional $2 billion last week which caused Ford to increase its production of the fuel-efficient Escape and Focus vehicles. Because of the popularity of these two models Ford has increased its market share and actually showed a sales increase of 2% for the month of July compared to the preceding year. General Motors has also announced that is considering an increase in production for the fourth quarter and has informed its suppliers to expect an increase of fifty thousand or more units.

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Because of the higher demand created by the government’s “cash for clunkers” program Ford announced that it will significantly increase its production in the fourth quarter of this year. Ford plants in Missouri and Michigan will add shifts and increase overtime to produce more of Ford’s Escape sport utility vehicle and the Focus compact. Ford is expected to build 570,000 vehicles in the last quarter, a 33% increase over the last quarter of 2008, and an increase of 15% over planned production figures before the clunkers program started.

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While sales of motor vehicles and automotive parts increased by 2.4% in July as compared to the prior month, retail spending overall, not including sales of cars and automotive parts, fell by 0.6% indicating that consumers are still concerned about the week job market and uncertainty of the economy.

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The Insurance Institute for Highway Safety has recently rated the Honda Insight, Toyota Prius, and Kia Soul the top rating of Good (on a scale of Good, Acceptable, Marginal, and Poor), in testing for side and rear crash testing. In order to achieve this rating a vehicle has to earn good ratings in three tests and must have electronic stability control.

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Volkswagen will pay about $4.7 billion for a 42% share in Porsche’s automobile unit. VW the largest European car manufacturer will fully integrate Porsche into its operations in 2011 as long as all requirements are met. This will end a four year feud regarding control of the two companies.

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Regarding the $3 billion Cash for Clunkers Program. Lawmakers would like to allow consumers to get vouchers from the auto makers if a vehicle is not in stock. Toyota, Honda and 11 other foreign car manufacturers feel that changing the car rebate midstream could be confusing for all those involved.

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