Hyundai has been one of the few brights spots in the U.S. automobile market, posting solid sales increases thoughout the current recession. Hyundai is also a strong player in China claiming nearly 10% market share and double digit sales gains year-to-year.

Japan is another story. That country’s stagnant car market has been a tough nut for Hyundai to crack and the company has decided to throw in the towel. Automotive News reports that Hyundai has sold a mere 15,000 cars in the eight years that it has had a presence in Japan, about as many as it sells in the U.S. in two weeks.

Japanese car buyers tend to be more jingoistic than buyers in other countries and have a particular prejudice when it comes to Korean cars. Given its success almost everywhere else in the world, Hyundai can easily walk away from Japan.

--M.D.

No one denies the impact that China has had on world markets nor doubts that it will continue to be a major player in manufacturing. Still, Chinese auto makers are finding the road to world domination far rockier than they might have thought.

While China’s domestic auto market is red hot right now, Chinese exports to Western markets are barely measurable. This should be an ideal time for the Chinese to gain the technology and access to markets that they need by snapping up brands from floundering Western auto makers but their success so far has been limited. Automotive News cites BAIC’s failed attempt to buy Saab from General Motors as one more example of the obstacles that China faces as it tries to expand globally. Even if a Chinese manufacturer is able to consummate an acquisition, sellers (e.g. Ford) may seek to specifically exclude intellectual property from the deal.

Furthermore, CNNMoney reported earlier that Mexico is making a comeback as American corporations are finding attractive manufacturing costs, lower transportation costs and easier access to domestic distribution networks in our southern neighbor. Chinese car makers also are said to be looking at Mexico as an entry point to North American markets but manufacturing capacity will be of little use if they don’t also have the technological expertise to meet U.S. and European safety and emissions standards.

--M.D.

Swedish supercar-maker Koenigsegg was in line to buy Saab from General Motors as GM shrinks down to four brands. Today, the company has walked away from the deal, which could cause Saab to be shut down as a brand if GM can't find another buyer for the brand.

This isn't good news for the parties involved, especially Saab. If GM can't find another buyer, not only would the brand vanish, but so would most of the dealers. Saab has always been a low-selling brand, beloved by loyalists for its quirkiness (ignition located in the center console?). It failed to prosper under GM's stewardship, and now, after it looked like it would be saved by a home-grown company, Saab is twisting in the wind.

Obviously, a wind-down of Saab would be bad for the industry due to the lost jobs (even if the amount of people Saab employees is relatively small), but it would also be bad because one of the few companies that dared to go in a different direction in an industry that all too often follows the leader will be no more. Sure, much of Saab's strangeness was reined in during its time under GM's umbrella. Sure, government safety standards and the economies of scale also forced Saab to slide a little bit towards the mainstream. That said, even for those of us who have no special attachment to the brand--such as your author--the parting of Saab will be met with sorrow, and won't be sweet.

The National Highway Traffic Safety Administration is investigating another possible recall of a Toyota product, the Tundra pickup truck.

According to Automotive News, NHTSA has received nearly 300 complaints of rusting frames on 2000 and 2001 Tundras and has asked Toyota to submit data regarding the problem. Although a Toyota spokesman characterized the problem as involving only a cross member that supports the spare tire, complaints received by NHTSA include corrosion of the entire frame as well as brake line components.

The news comes on the heals of a similar recall of the company’s Tacoma pickups last year and complaints of sticking accelerator pedals on certain Toyota and Lexus passenger cars which is currently under investigation.

--M.D.

Labels: nhtsa, recall, Toyota, tundra

If you own a classic car, a sports car or other summer fun car and you live north of the Mason-Dixon line, you probably put your car in storage for the winter. Here are some tips from various sources for properly storing your car to ensure a good, long life and no surprises when you pull it out in the spring:

• Put it away clean, inside and out.

• Give it a fresh oil change.

• Pour a gasoline conditioner in the tank according to the manufacturer’s recommendations and drive the car around long enough to circulate it through the fuel system.

• Over-inflate the tires to prevent flat spots or change them out with a set of junk yard tires. A set of “donut” spares works well. (Storing on jack stands can stress suspension parts.)

• Plug the tail pipe and air intake with steel wool or rags to prevent invasion by critters.

• Remove the battery and store it in a safe place with a “smart” charger on it. Do NOT store the battery on a concrete floor.

• Place some kind of critter repellent in containers in and around the car. Moth balls work but will leave an unpleasant odor that may never go away. Other suggestions include dryer softener sheets or strongly scented soaps shaved or cut up into small pieces.

• Once stored, do NOT start the car periodically. Unless you plan on driving it enough to completely warm it up, you will introduce moisture into the engine and exhaust system that shorten the life of components.

• Print the list of steps you took and leave it on the driver’s seat to remind yourself to undo them in the spring.

• Cover the car with a BREATHABLE car cover, blankets or sheets.

-M.D.

Nova, Dart, Maverick, Riviera, Fury, Galaxie. All perfectly good car names. All very popular and recognizable at one time. All now gathering dust.

Car makers use various naming schemes for their models. Some stick with the same names for years, no matter how much the model may have changed over time. Think Honda Civic, Ford Mustang, Chevrolet Corvette. Others seem to come up with a new name every time they redesign a car, i.e. Cavalier/Cobalt/Cruze.

European brands tend to prefer a straight forward numbering scheme (Mercedes, BMW, Volvo), though VW chooses to use decidedly odd foreign words (Eos, Tiguan, Routan), and they aren’t afraid to switch back and forth (Rabbit/Golf/Rabbit/Golf).

Do model names really matter that much? Should a car maker stick with a name and develop a heritage and history with it, such as the Mustang or Corvette, or doesn’t it really matter? What names from the past would you bring back?

--M.D.

Ford Anglia

This little beauty was sitting in the car corral at the Beloit Autorama, a large, regional car show in southern Wisconsin, earlier this fall. The Autorama is cosponsored by the Coachmen Street Rod Club and the Blue Ribbon Classic Chevy Club and is, as you would expect, heavy on muscle cars and pretty light on 1950s British compacts. Needless to say, this 1958 Ford Anglia stuck out like the proverbial sore thumb among the Camaros and Trans Ams that were for sale in the corral.

The little Anglia was actually in pretty good shape. Body panels were nice and straight and the interior looked original and was in surprisingly nice shape. The only blemish was a small area of surface rust on a lower rear fender. I didn’t ask the seller to fire it up, but the engine compartment looked very clean and original. Notice that it is left-hand drive, so it was built for export either to the Continent or to the United States.

--M.D.

Ford has announced that it intends to stay in the police car business when it discontinues its rear wheel drive sedans in 2011. In a press release, the auto maker said that “the new Ford Police Interceptor is being developed in conjunction with Ford's Police Advisory Board” and “will be offered without interruption when production of the Ford Crown Victoria ends in late 2011.”

The report also notes that the new police package will be engineered and built in America which might suggest that it will be based on a current large platform such as the Taurus, although the press release did not mention whether the new car will be built off an existing U.S. model.

Whatever shape it takes, Ford’s new police car will see more competition. Chrysler is currently selling a rear drive Dodge Charger police package and General Motors recently announced that it will offer a rear wheel drive police cruiser based on a Holden chassis from Australia. Additionally, Carbon Motors of Connersville, Indiana, has developed a purpose-built large sedan for use by police departments and other emergency personnel.

Speculation is running rampant that Ford’s offering could be an Australian import based on the rear drive Falcon that it sells in that market. Hold off putting money on that bet. GM has recent experience importing cars from Australia, Ford doesn’t (and the last Mercury Capri doesn’t count). Furthermore, Ford is known to have been working up a police package for the Taurus. Police departments aren’t sold on front wheel drive chassis for cop cars but they’re going to have to move out of their comfort zone anyway, so if Ford comes in with a durable, cost-effective package they might have a chance of hanging onto market share here.

Watch for final details about the package in early 2010.

--M.D.

Earlier this week, news broke that the Volkswagen Auto Group would be passing Toyota to become the world's largest automaker. It wasn't that long ago when Toyota passed General Motors for the same honor. My question is: Do car buyers care which automaker is number one?

I personally think that the automotive press is much more interested than the general public is, although there is one exception: When GM lost the crown to Toyota. That made news because GM had been number one for so long, because Toyota had long been ascending towards the sales crown, and because GM was struggling mightily and sliding towards its eventually bankruptcy. But I don't think the news about Volkswagen outpacing Toyota resonates nearly as much.

Of course, that's just one journalist's opinion. We in the media love "horse-race" coverage. But does the general car-buying public notice? I ask the Zazhub community, particularly those who may be buying a new vehicle soon, to weigh in with your thoughts in the comments section.

Labels: GM, Toyota, VW

Cadillac Converj is a Go?

At last January’s Detroit auto show press preview, Bob Lutz rode onto the stage in a Cadillac Converj concept. The car was based on the same platform as the Chevrolet Volt and Lutz promised that a car like the Converj, and possibly others, could be coming on line in the near future.

Turns out he may have been right. A GM insider told The Detroit News that the Converj is part of Cadillac’s future production plans, though no specific timetable has been determined.

My Take:

This is being reported as news, not rumor, so don’t bet the farm on it but it looks pretty solid. GM has to amortize the development costs of the Volt which, even at the $40,000 price tag they’ve been hinting at, could a money loser for them. Adding a premium brand model on the same platform could help recover R&D costs. Besides, Cadillac buyers are less likely to wince at the price and might be more interested in buying leading edge technology than Chevrolet buyers. Not to mention, the Converj was one of the hottest concepts at the show.

--M.D.

The rumor:

The rumor mill is quietly stirring up talk again that Ford may be considering dropping the Mercury brand. This time the speculation centers around the Mountaineer and whether it will survive when Ford introduces the new Explorer next year.

Rumors of Mercury’s demise have been circulating for several years. Its displays at the car shows are getting smaller and smaller. Ford is scheduled to end production of its large, rear wheel drive models (Crown Victoria, Grand Marquis, Town Car) in 2011. If the Grand Marquis and Mountaineer both leave, Mercury would be left with just two cars to sell and its future would look bleak.

On the other hand, axing a car brand can be painful and expensive, it might be cheaper to keep Mercury around. And Mercury dealers provide Ford with outlets in areas it might not otherwise have -- Ford is looking to grow its market share, not shrink it. And where will Grand Marquis buyers go when their beloved sedan is put out to pasture, the Taurus? Maybe, maybe not.

My take:

Too soon to put this one to bed. Watch the car shows next year. If you see a Taurus-based Mercury concept car or a cross-over or SUV, it might stick around a while. Otherwise: not with a bang but a whimper.

--M.D.

Reuters reports that Fiat chief Sergio Marchionne has halted Chrysler’s electric vehicle program. Over the past two years or so Chrysler has been trotting out electric concepts under an internal development program named ENVI. At last January’s North American International Auto Show, for example, they had no fewer than four such vehicles on display and were promising to plunge headlong into electric cars and trucks over the next few years.

Marchionne doesn’t believe that current battery technology is viable for use in electric automobiles and doesn’t think that electrics would sell in sufficient numbers to warrant further development. While Chrysler had been showing off concepts such as the Dodge Circuit almost every chance it could, no mention of any electric vehicle program appears in the five year plan that Marchionne revealed to the public last week.

--M.D.

Chrysler and Fiat spent nearly an entire day last week unveiling the company's five-year product plan, and there are a lot of changes in store. Here is one journalist's quick take on the plan.

* The Viper is going away, to be replaced by a Fiat-based sports car in 2012. To me, that's a bittersweet moment. I was 12 years old in 1992 when the Viper was launched, and the snaky sports car was one of several cars that helped turn me into a car enthusiast. As an adult, I've had the chance to spend some brief time behind the wheel of the modern Viper, and it's still an amazing car. Sure, today's customers may not appreciate the lack of creature comforts--Chevy's rival Corvette offers a much more civilized experience for less money--but Dodge never has apologized for that.

On the other hand, the Viper is getting long in the tooth, and it's hard to justify a business case for a gas-guzzling sports car when you're a company that is emerging from a federally-assisted bankruptcy in a recession-racked market that is increasingly focusing on "green" . General Motors avoided taking too much PR flack for keeping the Corvette, due to the Vette's status as an American icon and its more-palatable fuel-economy numbers.

As noted above, Vipers don't offer a lot of creature comforts, and they don't come cheap. While some folks appreciate the Viper for its elemental, back-to-basics nature, many customers with that kind of disposable income might prefer to be coddled a bit. High-priced supercars are a tough sell even during the good times, and the recession likely has made it harder for struggling Dodge dealers to move Vipers. Not to mention high gas prices and the low fuel-economy numbers that come along with V-10 power.

Replacing the Viper with a Fiat-based sports car makes sense. The question is, will the new car be like the Viper--a high-power, low-weight sports car that evokes images of American muscle? Or will it be a high-tech wonder that offers better handling and more electronic gizmos that current serpent? It's too early to tell.

* Dodge will be getting a crossover SUV to compete with Chevy Traverse and Toyota Highlander. Sure, the company already has the Journey, which is a nice-enough vehicle, but it doesn't look like an SUV, and therefore, consumers really haven't perceived it as such, it's been seen more as an alternative to minivans. Considering that Journey is a relatively new model, I doubt it's going anywhere, but I think it's a smart business move for Dodge to come up with something that looks a little more "SUV-like" in the crossover category.

* Jeep will gain a new small SUV. Another smart move, if the new vehicle is executed properly. Chrysler brands have suffered in part due to a poor reputation for quality, so if the company is to regain a strong foothold in the market, any and all new or redesigned products will need to be well-done. Jeep took a step backwards with the current Liberty and the rest of the lineup--save perhaps the Wrangler and Grand Cherokee--so every new product going forward will need to bring buyers back into the fold.

* Chrysler has begun advertising again. Regardless of the critical reaction towards the ads--which hasn't been completely favorable--the fact is, an ad blitz will put the names of Chrysler's brands back in the public eye. Some folks may have thought of the company as a non-entity as it progressed through bankruptcy, especially since the future of the company itself was in doubt. Unlike GM, which continued to launch new models, continued to blanket the airwaves with ads, and continued to remain in the public eye, Chrysler and its associated brands faded into the background when it came to product, and it seemed like the only news reported about the company was related to the bankruptcy--and more than a fair share of that news was negative. This gave the public a negative perception of the company, as more than a few folks thought that the company was teetering on the brink of failure. Bringing advertising back to a much higher level and showing off future products could give consumers the idea that Chrysler will be around for a while.

* Overall, the recognition that most of the company's current products need to be overhauled--and quickly--by the top brass is a good sign. There is a perception that Chrysler's previous owners, Cerberus Capital Management, never seemed all that interested in research and development of products. At least now, it appears that management grasps the importance of the quality of cars on the showroom floor. Whether this translates into results remains to be seen.

At this point, the company is simply showing signs of life, although the plans revealed last week received mixed reviews from the motoring press. It didn't help that most of the future-product details that were revealed were generic at best and vague at worst. Certainly, Chrysler/Fiat couldn't reveal too much, since the company doesn't want to give away secrets. So we'll just have to wait to see if the company's upcoming products can be competitive. And that may be the problem--some observers believe the company may not be able to stick around long enough to produce its promised product. I, for one, think those observers are wrong--Chrysler will hang in there long enough for these products to launch. The question is: Will these products be enough to keep it around for a much longer period of time?

At a marathon 7 hour press conference yesterday Fiat/Chrysler officials revealed their plans for the company for the next 5 years. By 2014 Chrysler will be a very different company than it is today.

Fiat 500

The 500 shows up in showrooms around this time next year sold as a stand-alone product.

Jeep

The Commander goes away next year, the Compass and Patriot are done in 2012. The latter two will be replaced by a Fiat-based C segment vehicle in 2013. The Grand Cherokee and Liberty stay but the Liberty is replaced with a Fiat-based vehicle in 2013. Also, a new A segment, Fiat-based SUV is also introduced in 2013.

Dodge

Trucks are pulled out of the Dodge division and sold as a separate brand: Ram. The Viper is dropped next year but might return in another form later. The Nitro goes away in 2011 and the Caliber is done in 2012. The Charger, Challenger, Avenger and Grand Caravan stay. A new full size cross-over is introduced next year, a new compact comes on line in 2012, a new sub-compact in 2013 and the Avenger moves to a Fiat platform in 2013.

Chrysler

The 300/300C, Sebring and Town and Country stay and get updated. The PT Cruiser is done next year. A new Fiat-based compact is introduced in 2012 and a new Fiat-badged B segment compact in 2013 along with a Fiat-based mid size cross over. The Sebring moves to a Fiat platform in 2013.

Ram

Light Duty, Heavy Duty and Chassis Cab models remain and get updated in 2012. The Dakota goes away in 2011 and might be replaced by a new uni-body mid size truck. Large commercial vans on a Fiat platform are introduced in 2012 as is a Fiat badged small commercial van.

Minivans, the rear drive passenger car and pickup truck platforms stay and will account for 44% of the line up but by 2014 fully 56% of Chrysler’s products will be based on Fiat platforms. Most of those will be sold as Chrysler brands though some Fiat badged products may enter the market.

Will it work? That remains to be seen. Chrysler’s market share is at an all-time low and it will take a lot of heavy lifting to move it back up. Chrysler also has quality issues to deal with and Fiat’s previous reputation in the U.S. market means it will take a lot of polishing to restore the luster.

--M.D.

David Cole, chairman of the Center for Automotive Research, recently expressed doubts about the wisdom of closing GM and Chrysler dealerships in the wake of the Federal bail out of those two companies.

The argument was made that American brands have a far larger number of dealers than foreign competitors such as Toyota and that maintaining that network is costly. Dealers who were considered underperforming were put on notice that their franchises would be discontinued.

Cole argues that, while there may be too much density and overlap in urban areas, cutting dealers would leave too few in the hinterlands where brand loyalty for American cars is the strongest. He has asked the Obama Administration’s automotive task force to revisit the issue.

Cole makes a good point. Selling cars is a retail business like any other. Most retailers look to expand market penetration and market share, not shrink it. GM and Chrysler say that the dealer network is costly to maintain. That may be true, but perhaps the answer is to find ways to reduce the cost of the manufacturer/dealer relationship rather than cede segments of the market to the competition.

--M.D.

Among the great automotive museums in the midwest, probably none tells the story of a single car company quite as well as the Studebaker National Museum in South Bend, Indiana. The museum is arranged as a time line of vehicles produced by the company over its 114 year history, from horse-drawn buggies and farm wagons to some of the most stylish automobiles to spring from an American car maker.

On the second floor, along one wall is a beautiful red 1964 Studebaker Daytona two-door hardtop with less than 50 miles on the odometer. The car has never been restored, it has always been preserved in its original condition. This was the last car ever to roll off the assembly line in South Bend. As I stood there admiring how well it had been preserved I began to think about the weight of history that is riding on its four wheels. As it came down the line in December of 1963, there were no more cars behind it. None.

Studebaker Corporation sprang from a simple blacksmith shop established by two brothers in 1852. It became the largest manufacturer of horse drawn vehicles in the country and it would be the only company to successfully make the transition from the horse drawn carriage to the automobile. For over one hundred years, this company had been the pride of South Bend, employing thousands upon thousand of workers, supporting their families and helping them fulfill their dreams.

Studebaker built some of the highest quality wagons and carriages you could buy. Its automobiles were noted for their durability and technical innovation. From its design partner, Raymond Loewy and Associates, came some of the most stylish American automobiles ever made. During World War II it became part of America’s “arsenal of democracy”, proudly churning out trucks and airplanes for the allied forces.

In the end, none of this could help the beleagured company survive fiscal problems that had festered throughout the 1950s. High overhead costs, a weak dealer network and a disastrous merger with Packard set the stage for the company’s demise. After South Bend was shuttered Studebaker shifted production to a Canadian factory using engines it bought from General Motors. On March 16, 1966, one last car came down that line and Studebaker would be no more. That car is also on display, a few feet from the red Daytona.

From the beginning, Studebaker carefully preserved its historical artifacts, including many of its vehicles. Including these last two cars to come down their respective assembly lines. Let us hope that the story and the cars of this once great company will continue to be preserved for generations to come. That the red Daytona will continue to look as good as it does today. As good as it did on December 20, 1963.

--M.D.