From today's WSJ-- VW is expected to report a 50% drop in operating profits due to the Euro and "a few hundred million euros to cover the cost of cars and technologies that are failing to generate the revenue the company expected." VW-North America is expected to show a loss due to the Euro. (Can you sing this to the tune of, "Blame in on Rio?") VW, which includes Audi, Bentley, and Lamborghini, spends an estimated 8.6% of sales on R&D versus the industry average of 6.5%. VW hopes that the new C1 will steal sales from BMW and MB. To keep costs down, VW may use a lot of the Maserati Quatroporte parts bin to build the C1. (Note to file -- Check VW's warranty expense in the future.) After spending 1.2 billion euros (that B as in billions) on the Phaeton, the car so far has been a flop. Only 3,000 were sold in Germany. It will be introduced in the US this year, but with a price of $60,000, which is $20,000 less than the European version. (Somebody musta not told the US dealers about this cause they are asking over $80k for the car.) VW admits that 2004 is pretty much in the tank. But things are looking up for 2005. (Or how about 2006? 2008?) Your intrepid reporter, DrKnowsitall.