Chevrolet Moves Small Cars Upmarket

Tuesday, March 30, 2010


As Chevy brings out its new line of small cars over the next two years, it will also move them upmarket a bit by adding additional content that is now optional, according to Automotive News.

The Chevrolet Cruze, which replaces the current Cobalt, will add features such as air conditioning and power windows which cost extra on the Cobalt. The smaller Aveo will also include a wider range of standard equipment than the current version and will boast sportier styling and handling, as well. The new Spark, which hits the market in 2012, will be GM’s smallest and least expensive offering in the U.S.

Chevy’s old rival, Ford, has made headlines with its soon-to-be-released Fiesta and the upcoming Focus replacement, both of which promise to be faithful reproductions of their highly praised and high-content European counterparts. Chevy appears ready to meet this challenge head on with its own small car offerings and will up the ante by adding the tiny Spark as a bargain priced mini-car at the bottom of the line up.

Will the strategy resonate with buyers? Probably so. Fuel economy concerns seem to be moving buyers into smaller cars but those buyers won’t want to give up features and comfort to which they have become accustomed. And they seem to be willing to pay a bit more. Stripped down price leaders such as the Nissan Versa Base aren’t exactly setting the market ablaze, particularly when reliable, late model used cars can be had for the same money.

--M.D.

Fiat to Grab 35% of Chrysler in Two Years

Saturday, March 27, 2010


At a press conference in Turin, Italy, last week, Fiat chief Sergio Marchionne vowed that the Italian car maker will increase its stake in struggling Chrysler from the current 20% to 35% within 24 months.

Fiat was given its initial 20% stake essentially for free and can up the ante in 5% increments by fulfilling certain conditions such as bringing production of new fuel-efficient technologies to the U.S. (MultiAir engines in Michigan: check) and building a new small car here. Fiat will also be expected to expand distribution of U.S.-made products in foreign markets.

So far Fiat’s labors have produced Powerpoints and press conferences but little else to boost Chrysler’s sagging fortunes. Interestingly, though, the Detroit Free Press quotes Marchionne as saying that “[t]he most important thing is that Chrysler is proceeding on a turnaround plan; the results are good.”

So there.

--M.D.

April Fools Day Comes Early at GM

Thursday, March 25, 2010



Or perhaps GM is serious about the EN-V* concept it unveiled this week. Developed for the World Expo 2010 in Shanghai by GM and its partner, Shanghai Automotive Industry Corp. Group (SAIC), the EN-V is said to address “the need for personal mobility through a radical change in personal urban transportation”.

The EN-V is powered by an electric motor driving its two drive wheels and can carry two passengers and small amount of cargo. Range is said to be about 40km and integrated GPS technology allows the vehicle to be driven manually or “autonomously”. Sensors on the vehicle permit it to avoid obstacles and collisions with other vehicles.

At just under five feet long, it is about one-third the size of traditional cars and weighs about 1000 pounds. GM says that given its size and manueverability, a typical parking lot could accommodate five times more EN-Vs than traditional cars. The EN-V is supposed to solve transportation problems in crowded urban environments now and into the future, addressing issues such as congestion, air quality, parking and affordability.

At least it beats walking. Or does it?

--M.D.


* Not to be confused with Chrysler’s defunct electric program ENVI.

Green Cars Need To Offer More Than Just Fuel Cost Savings

Wednesday, March 24, 2010

Ward’s Automotive reports that a new study by Accenture finds that while potential buyers are expressing a strong interest in hybrids and electric vehicles, those vehicles will have to bring more to the table than just great fuel economy.

Some 65% of those surveyed said that a green car would have to also offer top notch performance, reliability and affordability in order to persuade them to lay their cash on the hood. Interestingly, a majority of those responding said they would not be willing to pay more for a green vehicle such as a hybrid or an electric. Given that most hybrids cost somewhat more than comparable gasoline cars and that plug-in hybrids and electrics are likely to cost considerably more, these technologies may not catch on as quickly as some would hope.

--M.D.

March Car Sales Start Strong

Sunday, March 21, 2010

The Detroit Free Press reports that car sales for the month of March are continuing the momentum they showed in February -- and then some. So far, car sales this month are running at an annual rate of between 12.1 million (J.D. Powers) and 13.2 million (Edmunds) units. The last time sales were this high was last August during the government’s “Cash for Clunkers” program.

Generous incentives from nearly every car maker are driving the increase to some extent but pent-up demand no doubt accounts for much of it, too. As strong as sales were in February, they would have been even higher were it not for uncommonly miserable weather that shut down the east coast several times.

Once again, the big winner appears to be Ford which posted a breath taking 43% increase in February. TrueCar estimates that Ford will make substantial gains in market share in March, much of it at the expense of GM, Chrysler and Toyota.

Can it last? Some suggest that once the incentives expire, sales will fall back to the miasmic levels of last year. That line of thought ignores the pent-up-demand factor that is also driving sales right now. Also, a number of manufacturers are pumping up the excitement with fresh and interesting new products which could keep buyers coming.

Besides, car makers have the option of keeping incentives in place and riding the wave into summer when sales are traditionally stronger. I’m betting that they are prepared to do so.

--M.D.

The Cadillac of RVs?

Tuesday, March 16, 2010


On a recent visit to the RV/MH Hall of Fame in Elkhart, Indiana, I spotted this one-of-a-kind motor home sitting in a corner. This flashy beast is the Star Streak II, the brain child of Paul Jones of Cape Coral, Florida, and was actually the second of two that he built. It combines the chassis from a 1976 Cadillac Eldorado with a 455 cid engine from an Oldsmobile Toronado and lots of creative sheet metal work. At 270 inches long and 83 inches tall, it was designed to fit in most standard garages.

As practical as it is tasteful.

--M.D.

Buick Shows Off 2011 Regal

Thursday, March 11, 2010

Craig Bierley, product marketing director for Buick, introduced a group of journalists to the 2011 Regal today. Built on the same platform as the European Opel Insignia, the Regal will be built in Germany at first but production shifts to a GM plant in Oshawa, Ontario, early next year.

Two engines will be offered, a base 2.4-liter I-4 producing 182 horsepower and a 2-liter turbocharged I-4 rated at 220 horsepower. Both get a 6-speed automatic though the turbo engine will offer a 6-speed manual at a later date. The turbo version of the Regal will also be available with a new Interactive Drive Control System featuring driver-selectable suspension settings and automatic driver suspension setting adaptability. Bierley said that on-board yaw sensors will be able to monitor driver inputs and adjust settings on the fly.

“Make no mistake,” he noted, “this is a true European sports sedan.”

All Regals will include four-wheel disc brakes with four-channel anti-lock braking system, brake assist and electronic parking brake, StabiliTrak stability control system and full-function traction control and standard dual-stage frontal air bags and side-curtain air bags.

The Regal, and to some extent the LaCrosse, move Buick in a new direction and away from its traditional buyers. Bierley said that one-third of LaCrosse buyers are under 55 and it is likely that the Regal will skew the demographics younger still. Even so, Bierley said that dealers report fairly positive reactions from existing customers and it seems that Buick believes that it can hang on to those older, traditional buyers even as it aims for a more youthful target.

--M.D.

GM’s Whitacre Getting Impatient -- Heads Roll

Tuesday, March 9, 2010



Not satisfied that GM’s sales are growing fast enough, CEO Ed Whitacre is shaking up the executive ranks once again and will bring some previously axed dealerships back into the fold.

The latest victims of his impatience are Cadillac’s marketing and sales departments. Bryan Nesbitt, who headed the brand’s sales and marketing and who starred in the Cadillac presentation at the Detroit car show just eight weeks ago, has been demoted back to the design department. Other execs at Cadillac were let go altogether.

Recognizing that you can’t sell cars from empty lots, GM also announced that it will let more than 600 dealers who had been flagged for termination back into the tent. The move will also reduce by half the number of arbitrations that the company will face over the closings.

Was GM stung by Ford’s sales lead in February? Does management think they should be picking up more disaffected Toyota owners in the wake of that car maker’s recall problems? GM officials, of course, won’t say one way or the other, but apparently there is no such thing as status quo at the Ren Center right now.

--M.D.

Get ‘em While They’re Hot: Viper Production About to End

Sunday, March 7, 2010

At the end of this month, Chrysler will begin building the last 500 Dodge Vipers, the brand’s halo sports car that has been in production for nearly twenty years. A number of special package versions as well as 50 ACR models will be included in this last batch, according to the Detroit News.

The Viper was first introduced as a concept car during the 1989 car show season and was championed by none other than Bob Lutz, who was working at Chrysler at the time. Chrysler surprised the automotive world when it announced that the Viper would actually be produced for sale in 1992 and would include a V-10 engine that it developed with Lamborghini. From the beginning, the Viper’s hallmark was its brute force.

It is not certain if or when the Viper might come back. Dodge chief Ralph Gilles told reporters at the Chicago Auto Show that his team is working on a new version of the Viper but it is too soon to know whether it will see production. Given that Chrysler’s parent company, Fiat, also owns Ferrari and Maserati, a 21st Century version of the Viper could be an interesting exercise.

--M.D.

GM's Lutz To Retire -- Again

Wednesday, March 3, 2010


After much speculation and an aborted retirement attempt last year, the legendary Bob Lutz will retire from GM for good on May 1st of this year, according to the Detroit News.

One of the most colorful and forceful figures in Detroit in at least a generation, Lutz has worked, at one time or another, for all three American car makers and was the driving force behind such notable vehicles as the Dodge Viper, the Pontiac Soltice and the Chevrolet Volt.

No official statement has been forthcoming from either GM or Lutz, which is driving speculation regarding the retirement. He had been critical of limits on executive pay packages in the wake of GM’s bankruptcy and subsequent government oversight of the company’s operations. He also had found himself at odds with other GM executives over projects such as the Cadillac Converj which Lutz believed should be brought to market but which GM officially canceled just this week.

--M.D.

February Sales: Good News for Ford

February sales figures are all in now and Ford came out the winner with a 43% increase in sales over February 2009. What’s more, Ford managed to edge out GM for the first time since . . . well, it’s been a long, long time. The totals: 142,006 for Ford vs. 141,535 for the new GM.

Toyota, not surprisingly, saw a decline of 9%, though, given the recall turmoil, many experts were expecting an even bigger drop. Subaru and Nissan posted nice gains at 38% and 29% respectively while Honda showed a more modest increase of 13%.

Chrysler sales were essentially flat with an increase of barely 400 units over last year. While up is always better than down, Chrysler will need to come on much stronger than this if it is to meet targets set by Fiat chief Marchionne for 2010. With few fresh products planned until late in the year, it seems unlikely that its numbers will look much better in coming months.

The biggest losers? Smart dropped by nearly 69% and Suzuki was off 61%. One has to wonder if the market for the Smart ForTwo was more limited than parent company Daimler thought and has already saturated. Suzuki has been trying hard to raise its profile in the U.S. market with products such as the new and well-received Kizashi but, apparently, to no avail. With its strength in other markets, most notably India, one wonders how much longer Suzuki will keep trying to establish a foothold here.

--M.D.