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 CAR CHAT April 29th, 2005
Finding answers or pointing fingers?
Mercedes-Benz has begun what it says will be a cooperative effort with its suppliers to improve vehicle quality, which has been a festering issue in recent consumer surveys.
So far, Mercedes is demanding better quality checks from powertrain suppliers. That means stricter quality audit procedures and even attending quality workshops.
Electronic component suppliers also are under a microscope.
Some suppliers are bristling at the new procedures, fearing that Mercedes is being too punitive or merely shifting some of the blame for design or vehicle production problems.
It's beginning to sound like another chorus of the same, old blame-game song . Hopefully Mercedes will own up to it own responsibility and make good on its long term promise-to provide the best product in the marketplace.
2005 Los Angeles Auto Show Preview April 28th, 2005<[>
As similar as they may sound, differences exist between the California International Auto Show and the Greater Los Angeles Auto Show. Anaheim kicks off the model year, L.A. kicks off the calendar year. The latter takes place in an area so densely packed that those track driving events for Volvos and Chevys – always a spectator magnet – didn’t make the cut. Even among a mostly unchanged main cast, the spotlight shined on different performers. And there were many more guests from the aftermarket industry, who, fittingly enough, were placed underground.
90% of the cars were, of course, the same – not even the automotive scene moves fast enough to look much different after three months. But 2005 models that were new in October weren’t often hailed as new here, even though the year just started. That’s the trouble with making a flashy entrance: doing it a second time would just look awkward.
As usual, we media folk were subjected to dozens of press conferences consisting of blasting music and PR boasting about the company’s stellar (and often inflated) sales figures. Not so usual was the uneven representation – did all the invitations to Asia get lost in the mail? Only one company from the non-Western world had something to say – Hyundai – who only had one product to show, and it won’t even be for sale. One would think that any company that lives in or next door to L.A. (which describes every Asian make except Subaru) would show up to show off on their own territory.
But then, maybe it’s something about that territory. Anyone familiar with L.A. knows the values that most of the natives would sell their first-borns for – looks, appearances, and image – and patterns emerge when looking at the auto show agenda. Bentley, Porsche, Ferrari, Venturi, Saleen, Spyker, Panoz? Not exactly the companies one turns to for practical, intelligent transport, are they? Most people probably know those as makers of cars whose gas guzzler taxes could buy entire cars, to those who know of them at all. There sure was no shortage of autos boasting too-high price tags and too much power. Hey, nothing wrong with a little indulgence.
Among those mentioned, the most significant was probably Saleen (either the man or the company), who brought a mildly updated version of his S7 supercar that Conan O’Brien would jokingly call The Ranch, because it’s where 750 horses live. What better way to celebrate the new year than by shattering last year’s world horsepower record by 100? Take that, Ferrari Enzo.
French automaker Venturi (who?) had a superfast sports car of its own, significant because it’s electric. While not many people would blow $600,000 to save gas, it’s encouraging to know that electricity can not only be used to make a 50-mile-range joke, but also a hyperfast 300-horsepower exotic. Call it encouraging assurance that today’s already-capable gasoline alternatives are only in their infant stages.
BMW had an alternative to that alternative: a hydrogen-powered sports car. The biggest part of its H2R concept won’t be a concept for long, as BMW publicly promised that the hydrogen motor (which can also run on gas) will see production this decade. With Honda, Toyota, and GM pushing hybrids, with Volkswagen and Mercedes on the diesel front, and with BMW taking the hydrogen challenge, who will win in the end? Answer: the consumer. And the Earth. We at The superior Auto Institute think that is a good idea
And heading back down to Earth, we common folk got to see the new Volkswagen Jetta, looking better than ever at age 25. In the past few years, this kid has learned a lot and now holds some convincing credentials: two much more powerful and efficient engines, a six-speed Tiptronic transmission, and electro-mechanical steering. The slacker rear suspension is gone. The new People’s Car will be pleasing people aplenty.
Chevrolet, Pontiac, Dodge, and Audi had a few new production cars of their own, but that was pretty much all. Despite the natural connection between Los Angeles and cars, it would seem that putting on an auto show that’s three months after the first one, and on the same week as the nation’s most important (the Detroit Auto Show), might not be the smartest strategy.
April 27, 2005 * New products - Ford Freestyle and Mercury Mariner - vault Ford past Toyota into No. 2 position among all manufacturers in sales of crossover SUVs. * Ford Escape, bolstered by industry's first hybrid SUV, maintains its position as best-selling crossover SUV in America.
DEARBORN, Mich., April 27 /PRNewswire-FirstCall/ -- The hottest segment in the U.S. automotive industry is the crossover sport utility segment where the growth at Ford Motor Company is outpacing the competition.
In the first quarter of 2005, Ford Motor Company's crossover sport utilities posted the largest sales increase among all manufacturers. Combined sales of crossover utilities at Ford totaled 80,376 -- up 52 percent compared with the first quarter 2004. This compares with industry-wide crossover utility growth of 15 percent in the same period. Ford has eclipsed Toyota and now ranks second in sales of vehicles classified by WardsAuto.com as cross/utility vehicles.
Two new models, Ford Freestyle and Mercury Mariner, played important roles in Ford's sales increase. The Ford Freestyle had first quarter sales of 15,922, while the Mercury Mariner added sales of 8,218. Both models achieved their highest monthly sales to date in March.
The national rollout of a new hybrid version helped the Ford Escape post a sales increase of 7 percent in the first quarter and maintain its position as America's best-selling crossover utility. The Escape posted record first quarter sales of 44,099, including 3,569 hybrid models. The "no compromise" Ford Escape Hybrid is the world's first hybrid SUV and the cleanest and most fuel-efficient sport utility vehicle.
"Our new models are helping Ford to meet the growing demand for crossover SUVs," said Greg Smith, Ford's president - of the Americas, "and we are planning to increase the number of crossover offerings in the future."
In addition to the Ford Escape, Ford Freestyle, and Mercury Mariner, the company's Volvo unit offers two crossover/utility vehicles -- the rugged XC70 Cross Country and award-winning XC90. According to WardsAuto.com, there presently are 34 nameplates offered by 14 manufacturers in the cross/utility vehicle category
April 27, 2005 Kelley Blue Book's New Vehicle Buyer Attitude Study on Financing Reveals Consumers Continued Preference for Long Loan Terms
IRVINE, Calif., April 26 /PRNewswire/ -- The latest study from Kelley Blue Book Marketing Research, New Vehicle Buyer Attitude Study on Financing, finds that six out of 10 people who are about to buy a new vehicle prefer a longer term loan with low monthly payments when financing their next vehicle. Industry estimates are that nearly 30 percent of new-vehicle shoppers currently owe more on their vehicle than it is worth. Additionally, the average term for a consumer vehicle loan grew from 48 months in 2000 to 63 months in 2004. These consumers who are "upside-down" in their current vehicle loan could put themselves further into financial jeopardy by extending their next new-vehicle loan past the average four-to-five year term, yet as a group they do not seem concerned about the ramifications.
"Consumers who purchased vehicles with little or no money down and for a six or seven year term, will find they owe more than the car is worth when seeking out their next new vehicle," said Jack R. Nerad, editorial director of Kelley Blue Book's kbb.com. "This negative equity leaves future buyers two unpalatable choices: either stay in their current vehicle longer or pile on still more debt."
Both choices have negative implications for carmakers. If this one-third of the market keeps their vehicles longer, new sales and growth potential will be stymied in what is already a sluggish new-vehicle market. And if consumers add more debt, carmakers can expect more defaults on vehicle loans and bankruptcies, costing carmakers' captive finance arms millions and limiting market growth.
"Just as an over-reliance on low-cost, subsidized leases came back to bite manufacturers and financial institutions in the 1990s, so too could the move to increasingly longer loan terms in this decade," Nerad said.
The 2005 Finance study also found a declining number of consumers researching their financing options online prior to purchase than 18 months previously. Consumers cited convenience and the expectation of low interest rates from manufacturers as their reason for obtaining financing through the dealership. This finding is in line with Jupiter Research, which recently reported that in 2004 a significant number of consumers who research their auto purchases online believed dealers to be a better source of financing information than they perceived the Internet to be.
"Dealers have been hyping their zero percent or low finance rates for some time. I figured that was the way to go," said Lew Rader, who just purchased a 2006 Toyota Solara convertible. "When the dealership handed me a 5.3 percent financing rate, I immediately thought I should have done some homework on the finance rate before going to the dealership."
Nerad recommends current vehicle shoppers do their homework before heading down to the local dealership to buy a vehicle. This homework includes:
* Learning your credit (FICO) score, as this will help determine your
financing rate. Use Internet sites like FreeCreditProfile.com or
MyFico.com to obtain your free or low-cost credit rating.
* Calling your bank or credit union to determine if you qualify for an
auto loan and determine the exact rate.
* Checking the Internet for low financing rates from other third-party
financing sources. Companies like Capital One Auto Finance
(http://www.capitaloneautofinance.com/) offer a Blank Check(R) allowing car
buyers to walk into the dealership with pre-approved financing in hand.
If the dealer offers a better rate, consumers are under no obligation
to use the check.
Other findings in the study examine:
* Financing behaviors and preferences by gender, age group and income
level
* When, where and how car-buyers plan to obtain financing on their next
vehicle and their reason for doing so
* Loan term agreements and preferences
* Amount car-buyers plan to put down on their next new vehicle
Study results included in this press release may be used for public and/or private use with clear attribution to Kelley Blue Book(R) Marketing Research. To purchase this or other Kelley Blue Book New Vehicle Buyer Attitude Studies, please contact Rick Wainschel, vice president of marketing research at Kelley Blue Book at 949-268-3074.
April 24, 2005 April 23, 2005
OK- here is the skinny from a no-body- Too bad it costs so damn much!
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