The trouble with relying on China as the future of the global car industry is that the people in the People’s Republic have lost some of their voracious appetite for new vehicles. The China Association of Automobile Manufacturers reports that, in January, sales of cars and light vehicles dropped 23.8% year-over-year. Analysts blamed the lunar holiday. But sales rose only 5% in all of 2011. So, the market has softened considerably.

China may produce sales of 18 million vehicles per year, well above the 13 million or so in the U.S. But car companies realize that American car sales are rising rapidly, while Chinese sales are not. The U.S., just two years ago the black hole of car sales, has become a foundation for revenue of multinational manufacturers. China has become a market where large investments in factories and marketing is a problem, at least for awhile.

Another challenge for foreign car companies in China is that local companies have grown tired of watching manufactures from the U.S., Japan and Europe exploit their market. All of the large local firms have learned manufacturing from their joint venture partners like GM and VW. That gives them the ability to stand on their own, and that can only hurt the sales of outsiders.

China has lost some of its luster for foreign car companies — that is, sales there have faltered — for a a number of reasons. Among them is that China’s middle class faces the effects of an economic slowdown and an inflation rate that hit 4.5% last month. And many Chinese cars are still relatively new. The factor of the replacement of cars that are six years or older, which is the cause for much of the improvement in sales in the U.S., is not as large a factor in China. There, the really huge volume in annual sales only happened in the past several years. The Chinese may not be ready to trade their cars in yet.

China, once the biggest hope for sales by global car companies, cannot sustain the revenue increases that the industry hoped it would.

Douglas A. McIntyre

Nissan reported a strong fiscal third quarter. Profits rose 4% to $1.54 billion. The firm sold 1.2 billion cars and light trucks, up almost 20% from the same period last year. Just one day earlier, Toyota said its earnings for the quarter were higher than expected. Just ahead of its earnings announcement, it raised its full-year forecast for sales to 9.58 million vehicles for the fiscal year. That will put it on a path to reclaim the global sales lead from GM and Volkswagen.

In Europe, Opel has set a collision course with unions, particularly in Germany. Opel has lost $13 billion since 1999. GM says it will restructure the entire unit, this as car sales across the region falter. The region’s large car union is allowed to appoint several members to the Opel board. They will give one of those seats to Bob King, the head of the U.S.-based United Auto Workers, which is a sign they are ready to strike.

Nissan and Toyota have had nearly no labor problems, particularly in the regions that matter most to them: the U.S. and China. The car industry battles with the UAW were largely won by the large manufacturers during the recession as GM and Chrysler went into Chapter 11 and the balance of the industry incurred huge losses. The relationship between the Big Three and the UAW actually have improved as the companies have paid bonuses to workers because of a profit recovery.

Opel remains caught in the jaws of an old business model. Labor has a substantial say in the operations of many of Europe’s car companies. But most of those firms, which include BMW, Mercedes and VW, have large sales bases outside Europe. Opel does not.

Opel’s near-term future will be determined by whether it can build a bridge to the new car manufacturing system. It is one in which union workers will lose jobs. But the jobs of those who remain will be relatively secure, because a restructuring will bring down the breakeven point of sales needed to make a profit. Without such a deal, Opel will continue to lose money. Large strikes against the company will make that worse and actually could cause the number of jobs eventually cut to soar. Opel does not have much to lose while it remains pressured by huge losses.

Douglas A. McIntyre

BP Fights On

The crisis at BP (NYSE: BP) due to the Deepwater Horizon disaster seems long gone. It is not. BP signaled an improvement of its financial health with a dividend increase. At almost the same time, the UK-based firm said it would “vigorously” contest suits against it because of the spill. That vigorous defense of actions will take years. The first major suits against it will be filed this month. Large liability cases brought by governments and private enterprises against major companies before indicate that the process of trial and settlement talks can drag on seemingly forever.

Toyota’s Recovery

Toyota (NYSE: TM) announced the start of an unexpectedly rapid comeback from recall problems and the shuttering of many of its plants due to the Japanese earthquake of last March and more recent interruptions of its supply lines due to floods in Thailand. Toyota made $1.1 billion in the quarter that ended in December. Toyota raised forecasts for net and operating profit. The company still has to regain market share in the U.S. and gain on Volkswagen and General Motors (NYSE: GM) in China, the world’s largest car market. Its market share in the U.S. reached almost 18% four years ago, and it briefly moved ahead of Ford (NYSE: F). Its portion of the market is down to about 12%, and its has competition from resurrected GM and Chrysler, as well has rapidly selling new cars and light trucks made by South Korean manufacturing behemoth Hyundai.

Lumia 900 Launch

Nokia’s (NYSE: NOK) Lumia 900, its new flagship product, is about to go on sale in the U.S. The launch carries with it the hopes of a comeback for the world’s largest handset maker and its software partner Microsoft (NASDAQ: MSFT). Microsoft has had terrible trouble as it struggled to sell its mobile OS against Apple’s (NASDAQ: AAPL), as well as smartphones that use the Google (NASDAQ: GOOG) Android platform. The recent history of smartphone launches shows that the fate of products usually is determined in the first few days they are available. Reports of strong sales bring new customers into stores. Reports of weak sales cause analysts and the press to label a new product DOA.

Douglas A. McIntyre

Greek leaders face a deal for settling sovereign debt matters as workers strike. (Reuters)

Toyota (NYSE: TM) posts good third-quarter profits and says the U.S. will be a difficult market. (Reuters)

Boeing (NYSE: BA) may have trouble with its 787 deliveries after flaws were found in the body of the aircraft. (Reuters)

Verizon (NYSE: VZ) and Redbox set a deal to compete with Netflix (NASDAQ: NFLX). (Reuters)

Amazon.com (NASDAQ: AMZN) may open a physical store in Seattle. (Reuters)

House Republicans move to reopen debate on the Keystone XL pipeline. (Reuters)

Problems with regulators have made the Medco (NYSE: MHS) merger with Express Scripts (NASDAQ: ESRX) less likely. (Reuters)

The U.S. will create programs to help the troubled money market industry. (WSJ)

Barclays (NYSE: BCS), Credit Suisse (NYSE: CS), Morgan Stanley (NYSE: MS), Goldman Sachs (NYSE: GS) and Royal Bank of Scotland (NYSE: RBS) will bid as the New York Fed auctions risky bonds it got as part of its AIG (NYSE: AIG) bailout. (WSJ)

Greece will cut 15,000 public sector jobs. (WSJ)

Motorola Mobility (NYSE: MMI) wants a 2.25% royalty on Apple (NASDAQ: AAPL) iPhone sales based on IP claims. (WSJ)

Walt Disney (NYSE: DIS) and Univision are in talks to create a 24-hour news channel. (WSJ)

India cuts its growth forecast to 6.9%. (WSJ)

Eugene Isenberg of Nabor Industries (NYSE: NBR) gives up a $100 million retirement payout. (WSJ)

The Obama budget will have $3 trillion in cuts over 10 years and $1.5 trillion in new taxes — mostly on the rich. (WSJ)

Japan wants to enter a large Asia-Pacific trade agreement, but the U.S. may object. (WSJ)

Satellite makers say that U.S. regulations make it difficult for them to compete overseas. (WSJ)

Republic Airways (NASDAQ: RJET) is about to sell Frontier. (WSJ)

New LeadershipIQ research breaks companies into four groups based on management style and systems to create results. (WSJ)

Walmart (NYSE: WMT) promotes a manager to be the new CEO of its China operations. (WSJ)

Some large European banks will not take European Central Bank loans because they fear it will make them appear weak. (WSJ)

BP (NYSE: BP) raises its dividend. (FT)

An escrow fund may be set to help Greece instead of all aid money going to the nation directly. (FT)

Farmers to plant the largest corn crop since 1984. (Bloomberg)

Walmart will lower fat, sodium and sugar in some foods. (Bloomberg)

Douglas A. McIntyre

We have compiled previews using Thomson Reuters consensus data and have added color on each if applicable.
 
Annaly Capital Management Inc. (NYSE: NLY) is going to be closely watched by the dividend investors because of that 13% implied dividend yield.  The mortgage REIT is expected to report $0.56 per share.

Bp Plc (NYSE: BP) has recovered handily from the 2010 Deepwater Horizon disaster.  This is an ADR so its earnings will be converted from U.K. Pounds… The estimate is $1.57 per share and the stock is up well over 50% from when its shares sold off so much in 2010.  Keep in mind that this was a $60 stock before the Gulf of Mexico disaster.

Buffalo Wild Wings Inc. (NASDAQ: BWLD) is not so hot after the Super Bowl and we are six weeks from the next mega-event in sports.  Estimates are $0.67 EPS and $210.25 million.  This one remains expensive at almost 22-times full 2012 earnings expectations and it is only about $2.00 shy of a 52-week and all-time high.

Cerner Corporation (NASDAQ: CERN) is expected to report $0.53 EPS and $586.86 million in sales.  At $63.20, the 52-week trading range for the healthcare information technology and support company is $53.93 to $74.39.

Church & Dwight Co. (NYSE: CHD) is expected to report $0.51 EPS and $694.32 million.  At $45.50, the 52-week range is $33.83 to $47.00.  This consumer products company remains at a large valuation premium to its larger consumer products rivals and it also has a much lower dividend yield.

The strengths that Ammann cites could easily be turned against it. The first is that its market share and pricing are strong in the U.S. That has made it the primary target of the largest manufacturers — Ford (NYSE: F) and Toyota (NYSE: TM). Ford already has proved it can do well in the U.S., and has since GM and Chrysler went into Chapter 11. After two rough years, Toyota’s plants are back online at full production. The Japanese quake of last March had idled some of them. America’s number three U.S. car company, Chrysler, is now its fastest growing. That is another challenge to GM’s plans. Perhaps just as great a danger to GM is the success of several niche firms. These include BMW and Mercedes at the high end of the market and Hyundai and Kia in the mid- and low-priced segments.

GM also says it can rely on China, the world’s largest car market. That plan has two barriers. The first is that the growth of the market for cars and light vehicles in the People’s Republic has slowed. The other is the GM no longer just competes with other foreign car companies in China. Local firms want to take market share from GM and have begun to bring on the manufacturing capacity to do so.

GM’s Achilles’ heel is its EU operation, Opel. Opel has not made it through a restructuring the way GM has in the U.S. There is still a battle between GM’s money-losing unit and local unions. And some EU nations are anxious to make sure GM keeps jobs within their borders. GM has a union problem in Europe, and it also has a political one.

GM’s CFO would have been better off saying that GM is a world-class car company with a bright future and left it at that.

Douglas A. McIntyre

China’s GDP Growth

The IMF cut its forecast of China’s GDP growth this year. Given the uncertainties about the global financial markets and the GDPs of many nations, that move it not unusual. What is shocking is the size of the negative forecast — China’s GDP growth rate could drop 4% from the current estimate of 8.2%. And the 8.2% is a number reached by a downward revision by the IMF less than two months ago. It is hard to fathom that an economy that has grown at more than 10% a year for the past decade could face such a shock. It is the IMF’s acknowledgement that the entire world could teeter into recession, and that the problems in Europe could effect both China’s trade with that region, but also with the U.S. The latter will not avoid the slump either, the IMF must reason, despite recent, strongly positive signs.

Foreclosure Abuse Deal

State attorneys general and U.S. regulators are just a day from a settlement with Ally Financial, Bank of America (NYSE: BAC), Citigroup (NYSE: C), Wells Fargo (NYSE: WFC) and JPMorgan (NYSE: JPM) over mortgage foreclosure abuses. The settlement would help current homeowners. Some would be allowed to refinance current home loans. Others would get financial assistance. Even if the deal is closed, the implementation could take months. It will take at least that long to sift through which homeowners are worthy of aid, and then to process them to help those who deserve it. The entire face value of the settlement will be $25 billion.

GM Profit Forecast

General Motors (NYSE: GM) says it can make $10 billion a year for the next several years. That would mark a tremendous comeback from its 2009 Chapter 11 filing. It also would validate the decision of the U.S. government to bail out the car company. The challenge GM faces as it presses its goal is that the world’s largest car manufacturers, Volkswagen and Toyota (NYSE: TM), expect to do as well as GM. Toyota just raised its sales forecasts to levels that would take it to a record in units shipped next year, if it can reach the numbers. VW has attacked the U.S. market because it needs American sales to allow it to keep pace with its two major rivals. GM has momentum, but its profit forecasts are large enough to make an uphill battle.

Douglas A. McIntyre

Read: The Eight Brands That Wasted the Most on the Super Bowl

Between 2002 and 2011, companies spent $2.5 billion on Super Bowl advertising, based on 24/7 Wall St.’s estimate. The top 10 spenders were responsible for more than one-third of that. And one company, Budweiser maker Anheuser-Busch, spent almost $250 million over the past 10 years on Super Bowl ads, or a whopping one-tenth of all Super Bowl ad spending.

24/7 Wall St. ranked total spending for all of the companies that advertised during the Super Bowl in the past decade. An analysis of the top spenders reflects how bad this investment can be. While some, such as Hyundai and Toyota have improved market share over that time, most have not. Based on total ad spending, product failures, change in market share, share price and sales, we identified the eight brands that wasted the most on the Super Bowl, including mega brands such as Coke, Budweiser, GM and Ford.

Based on 24/7 Wall St.’s analysis of Super Bowl ad spending, the top spenders fall into four major categories: automotive, film, food, including snacks and fast food, and beverages. Four of the top 10 Super Bowl advertisers are auto companies. Another four of the 10 are food and beverage manufacturers. Three movie studios are in the top 25.

Because Super Bowl ads are used by a small number of industries, many companies in those industries are forced to advertise just to keep up. Most of the top 10 spenders are perennial also-rans. Yum! Brands, owner of KFC, Taco Bell and Pizza Hut, spent $67 million over the past 10 years. Meanwhile, McDonald’s, the indisputable market leader, spent less than half that amount and is not a top 10 spender. Similarly, E*Trade, well-known for the talking baby campaign, spent more than any other online brokerage firm, yet remains fourth in the industry.

Also Read: AMR – Saving Corporate America one Bankruptcy at a Time

24/7 Wall St. tabulated all of the commercials from the past 10 Super Bowls, as archived by Adland, the “world’s largest archive of Super Bowl commercials.” Using that data, 24/7 calculated the number of commercials each company bought, as well as their length, including any available pregame, postgame and prime advertising commercials. To estimate the total amount each company spent on Super Bowl advertising in the past decade, we used the average costs of a 30-second commercial spot each year and the total number of minutes of advertising time recorded by Adland.

These are the eight brands that wasted the most on the Super Bowl.

Read The Best-Selling Cars of All Time

The best-selling vehicles have several other notable features in common. For one, the majority were introduced just before or around the same time that gas prices began to rise rapidly in the early 1970s, primarily because of the Arab oil embargo. Car companies offered 4-cylinder, light and fuel-efficient cars that allowed people to drive without badly hurting household budgets. Many of these cars continue to sell well today as gas prices are relatively high around the world.

Many of these cars also are manufactured and sold around the world. The Beetle is sold in the U.S. and Europe. The Passat is built in both the U.S. and China. Several of the best-selling cars from Japan are sold in most major countries around the world. Once a car proved its appeal with consumers, it made economic sense for a manufacturer to use the same base chassis and engine at plants on different continents.

24/7 Wall St. looked at best-selling car data from a number of sources. The sources included major media outlets that cover the auto industry, research firms, and car companies that keep lists of their own best-selling cars.

This is the 24/7 Wall St.’s Best Selling Cars of All Time.

Read: The Eight Industries the U.S Has Lost to China

For several years, economists have said that China’s GDP growth indicates that its economy will pass that of the U.S. in the next two or three decades. China’s GDP is measured at about $6.5 trillion, now second in the world. America’s GDP is over $15.2 trillion, according to the International Monetary Fund. While China certainly has much catching up to do, the two countries’ rate of GDP growth is also very different. Last year, China’s economy expanded at more than 9%. America’s GDP grew at a little better than 2%.

One reason that China continues to gain so rapidly on the U.S. is the high cost of American labor and manufacturing. In fact, U.S. manufacturing costs have risen so much that they are much higher than in any developed nation with factory capacity. This includes countries like China, Mexico and South Korea — places the U.S. and Japanese companies often contract to do their factory work. The labor price advantage has helped China become the largest steel producer in the world. China is also first place in car manufacturing.

Low labor costs are not the sole reason China has become the single largest provider of many goods. China’s 1.3 billion citizens have become voracious consumers as workers in its manufacturing sector have grown the number of its middle class. China also has decided that it is often financially better to provide its own raw material for its factories — items like cotton — than it is to import such items from overseas.

24/7 Wall St. examined the manufacturing, agricultural and financial businesses in which China has surpassed the U.S. China likely will become the world’s largest economy based on GDP. It certainly has shown that it has the capacity to advance on that position — one large industry at a time.