Day three of the North American International Auto Show in Detroit is comparatively quiet. I took advantage of the lull to chin wag with Clay Dean, Cadillac’s Global Design Director and Dave Caldwell, Caddy’s top spin man. Both men were refreshingly candid. So I challenged the duo on the brand’s marketing mix: product, price, place, and promotion. While the adulation heaped upon the CTS, CTS-V and CTS Coupe indicate that Cadillac’s lineup is better off now than when ‘Slade sales started slipping, what of Caddy’s future?
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After I finish this post, I'm off to the U.P.S. store to post a memory stick of my audition for Top Gear (posted on YouTube here). Thanks in part to the writers' strike, NBC is attempting to fashion a uniquely American version of the highly sarcastic (to say the least) British program. It's important to note that British Top Gear airs on public TV; which is funded by a TV tax. The U.S. version will air on "free" TV, funded almost entirely by advertising. Now I'm not sure how much of GM's $2.1b annual ad spend the peacock network enjoys, but I bet it's a fair old whack. And Ford's no stranger to signing huge checks with the letters "NBC" in the important space. Not to mention Chrysler, Mercedes, BMW, Subaru and the rest of The Truth About Cars fan club. So you gotta wonder about the relationship between my chances and American Top Gear's editorial freedom. My brilliant career aside (as it has been for many years), the idea of a mainstream TV show that "dares" to be critical of crap cars sounds preposterous. But I've still got that Honda-friendly ELO song ringing in my ears. So WTH. I'm sending the stick (not Stig). Wish me luck. And rest assured that while every man may have his price, the ability to tell the truth is mine. I know.. I should be so lucky. Well, guess what? I am.
Would Rosa Parks have been able to hop a bus and escape New Orleans ahead of Hurricane Katrina if she'd been in town in 2005? It’s a pretty convoluted way to start a rant, but The Black Commentator guest columnist Meizhu Lui says Hurricane Katrina exposed the "internal combustion engine" divide. Forgetting the fact that Amtrak was deadheading [empty] trains out of town and that New Orleans had lots full of [empty] school buses, Lui flags the “alarming disparity in car ownership that literally was the difference between life and death for many Gulf Coast residents." The author then cites a “recent report” claiming that 24 percent of black households don’t own a car– as opposed to seven percent of white and 17 percent of Latino households. Rather than calling for expanded car ownership, Lui says there’s a better alternative. “Hurricane Katrina not only dramatically revealed the grotesque racial and class divisions in our country, but also pointed to some obvious causes, such as our car dependent economy. An inclusive and dependable public transportation system should be at the top of the list.”
Leave it to Gaywheels to make the Detroit Auto Show sound so… well… gay. They've chosen their "Top Ten Moments" from the show, starting with the bull-on-bull action during the roll-out of the new Ram. That's where "the daddy bulls started mounting the boy bulls in a bovine version of '70s porn, complete with mustachioed cowboys." Moving right along… another fav was the Mercedes' GLK intro when Kim Cattrall "smiled coyly, touched Dieter's shoulder, and cooed about 'assertiveness, bulges in the right places… [and a] tight little package.'" They describe the CTS-V as having "a well-bulging hood that Kim Cattrall would love" and liken the BMW 1-series convertible to "any guy packing six-pack abs on South Beach, [who] sheds its top in 22 seconds. And like that same guy after a day of sun and proximity to half-naked men, the 1-Series is raring to go." And just in case the American Family Association isn't pissed-off enough at Ford, gaywheels says "if Ford could just stream the video from the F-150's optional backup cam down from Brokeback Mountain, they'd have a major new source of badly needed revenue." At this point, it's gotta be worth a try.
The Canadian Press reports that the Liberal Party (with a capital L) has pledged a $1b fund to subsidize R&D in green technologies. Party Leader Stéphane Dion notes that Canada must go green via government subsidies– or else: "Tax cuts alone are not enough… Innovation is essential to the survival of our industries, but it can be an expensive undertaking." Ostensibly, some of money will go to Ontario, where the heart of Canadian automotive manufacturing aches with the pain of high fuel prices and an atmospheric loonie. Though he slammed a similar amount promised by the current Conservative government– albeit as a high-dollar relief measure not a Green subsidy– Canadian Auto Workers' head honcho Buzz Hargrove welcomed the announcement. "This fund would provide a much-needed boost to struggling manufacturers and the workers they employ, particularly the auto industry which is grappling with unfair trade, a slowing U.S. economy, a high dollar and environmental challenges." Buzz has always known where his friends lie (so to speak). But let's not forget that Canada's Liberals have an abysmal environmental track record. After Jean Chrétien's Liberal government ratified the Kyoto protocol, Canada became the number one per capita consumer of energy among the developed world. Greenhouse gas emissions rose by 26 percent during the years the Liberals held power (so to speak). Still, no political party has a lock on hypocrisy.
In the grand scheme of things, in the face of a federal mandate calling for U.S. production of 36 billion gallons of renewable fuels per year by 2020, a $55k grant to The Cornhusker State's Ethanol Board is a meaningless gesture. But ours is not to do or die; ours is to wonder why. According to Nebraska Farmer, "Funds will support workshops to train ethanol producers, E85 distributors and marketers for the direct marketing of E85 from producers to local retailers. The one-day workshops will be offered on multiple dates and cover EPA ethanol storage requirements, fuel tax incentives, ethanol safety and handling training, and E85 marketing and brand awareness." The money will come from the Nebraska Department of Economic Development, The Clean Fuels Development Coalition, the National Ethanol Vehicle Coalition and the Clean Fuels Foundation. "Ethanol has brought much in terms of jobs and wealth to Nebraska," says Todd Sneller, administrator of the Nebraska Ethanol Board. "By encouraging direct relationships between ethanol producers and their communities, drivers get a cheaper fuel for their cars and the number of E85 pumps in Nebraska increases." I wonder how much Todd gets a year…
"The two big questions in my opinion is [are?] whether they have or can get the technology, especially in the battery arena, to pull this off… The second thing that seems questionable is that they will be able to manufacture a car in the volumes that they are talking about." No, that's not TTAC talking about Tesla or Volt. That's Tesla's Daryl Siry trash talking Henrik Fisker's Karma electric car, unveiled at the Detroit Auto Show. In what sounds like a classic case of "if you can't beat 'em, beat 'em up" he gives Fiskar a right royal pasting in his Horseless Age blog. Speaking from experience, Siry points out "Designing and integrating the battery pack alone is going to be a very big undertaking." Then he takes Fisker to task for "already quoting a price and taking reservations on a car that isn't even in drivable prototype phase" (a la Tesla). After pointing out that Jalopnik's wrong, wrong, wrong about the demise of their WhiteStar project, Siry admits he's learned that "there is a long road between here and there." We suggest Siry contemplate the even larger space between his company's hype and on-the-ground reality.
The feds made us do it! I'm tempted to say that the Dow Jones' Marketwatch interview (via CNNMoney) with GM's Car Czar is Maximum Bob unplugged. But that assumes that Mr. Lutz was, at some point, connected with reality. Anyway, here we have Maxi Bob taking his "raised federal fuel economy standards are like forcing fat people to wear small clothes" argument to the next level. "With the federal mandates at 35 miles per gallon coupled with cheap fuel, it puts us at war with our customers. At $3 a gallon (for gas) many people still want full-sized pick up trucks (and) full-sized sport utilities with V8 engines… and we're not going to be able to sell it to 'em because we if we do we won't make (the federal mandates)," Lutz told the Dow folk, adding, "It's ridiculous." Strengthening his already bullet-proof rep for spouting Pollyanna prognostications based on sweet FA, Lutz also says he's spoken to bankers who think the worst is over for the "mortgage meltdown crisis and the liquidity crisis." Anyway, who cares? "If everything goes well in the rest of the world, we can take a couple hits in the U.S. and still be okay." And just in case you thought Bob's reality divorce papers weren't signed yet, how about this: "We are working on the electrification of the automobile because my personal theory is the best way to save fuel is to use none at all."
By the end of next month, GM will have offered 48k workers a buyout package. How many United Auto Workers' (UAW) members will take the offer is yet to be seen, but the Lansing State Journal thinks it may not be enough. Most workers willing to be coerced bribed enticed to take such a deal did so last year, when 34k union employees left the company. The remaining (and somewhat younger) workers realize they'll have to work somewhere; if they give up their $28/hr jobs they won't be able to find anything close to it in their area. However, unless GM can rid itself of the higher-paid workers and replace them with "noncore" workers willing to accept $14/hr, their nebulous turnaround plan might not work according to [undisclosed] plan. Union officials would only say they were waiting for more details of the buyout before commenting on their evaporating membership's options.
Audi has dominated the Le Mans series with the diesel-powered R10; Peugeot is also fielding a diesel race car. Now The Daily Yomiyuri reports that Toyota's considering jumping into the alternate powertrain fray with a hybrid-powered Le Mans car. Although Toyota last ran the Le Mans in 1999, they recently won the Tokachi 24-hour race last year in a Supra retrofitted with a hybrid drivetrain. The LeMans cars will have a "special capacitor" (no, they didn't use the word "flux") to "facilitate an extremely fast power supply and charging function." Apparently, ToMoCo sees a hybrid-powered endurance racer as a way to generate interest in the gas – electric powertrain in Europe, which already has plenty of cars equipped high mileage gas and diesel powerplants. Considering Toyota's "success" in F1, they better hope they don't need a checkered flag to make the point.
Hammering the IS-F through the sleepy desert two-lanes of Rosamond, California, I tried to remind myself: “I’m driving a Lexus.” But the 416-horsepower sedan leaves little time for inner monologues. Caned hard, the IS-F reels in straight-aways like King Triton's spey rod. Corners arrive before your consciousness can catch up. Quick! Turn in, dip the throttle, unwind the hefty steering and feel the skittering rear wheels rotate you through the apex. Then look down at the silver “L” pointing at your chest. Cognitive dissonance much?
As Motown's chief cheerleader, The Detroit News is all about the spin. But every now and then, the paper kicks it up a notch to kick Toyota in the teeth. Columnist Daniel Howes recounts ToMoCo's '07 "challenges." For those of you who aren't regular readers of the DTN or TTAC (or any other automotive publication), Toyota stands accused of hypocrisy for perpetuating their green rep whilst selling gas-guzzling trucks and SUVs and lobbying against an increase in federal fuel economy standards (unlike…?). "Yes, UAW President Ron Gettelfinger had it right up on Mackinac Island last May: Toyota is not a division of Greenpeace — and it never was." Howes then rounds on Toyota for its Consumer Reports downgrade and product recalls, and shares an unsubstantiated anecdote. "On a separate press event to unveil the car, two Camrys were knocked out with transmission problems. In contacting Japan, they were told Toyota engineers there knew of a problem with a coupler in the transmission but failed to notify their colleagues in the States." In sum, "One of the lessons of this year's auto show is that for the first time in what seems like forever, a fair amount of Detroit's metal is reaching (if not exceeding) parity with its chief rival Toyota. That means a whole new kind of competition is about to begin and Detroit is back in the game." Fair enough?
GM wants to consolidate its eight automotive brands into urban megastores. According to Automotive News [AN, sub], Marketing Maven Mark LaNeve even has a name for these Buick, Pontiac, Saturn, GMC, Cadillac, Hummer, Saab and Chevrolet megastores: "GM Collections." Apparently, the concept would help GM to "maintain a high profile in cities where real estate is costly." To that end, dealers would be encouraged to move service and parts operations to "satellite centers." Ya think? To represent, a GM megadealer would need at least 49 demo vehicles. And then there's all the pickup truck variants. Even without considering exterior colors or option packages, that's a lot of choice. Too much? Not according to AN writer Jamie Larau. "The superstore approach likely would make GM brands more attractive to big dealer groups such as AutoNation Inc. and Sonic Automotive Inc." (Maybe he should have asked them.) And what of GM's divisions' brand weaknesses, and the obvious product overlap? [crickets chirping] Folks, arguments can (and will) be made for this idea, but there's a compound word for the concept, and the first part of it is "cluster."
There's not much new in the [UK] Times analysis of Detroit's troubles, save the above paranoid, defeatist, defensive, sour grapes quote from GM Car Czar Maximum Bob Lutz. (We're no longer number the world's largest automaker? What a RELIEF!) Oh, that and the headline, an extremely non-Detroit News-like "US carmakers still on the wrong road." The gist of the matter: longtime auto industry observer Ray Hutton reckons The Big 2.8 got caught with their small car pants down. And he's not buying the idea that ANY of Motown's former maestros can pull themselves back from the brink– at least in the U.S. In fact, Ray reckons "Nobody expects a big turn-round in America, where the market for cars and light trucks is at best static, at about 16.5m a year, although some analysts predict a steep decline in 2008." And that's about it, except for the fact that Chrysler CEO Robert Nardelli is either developing a penchant for Zen koans or developing new ways to tell the press to f-off. "The advantage of being private is that we can be private."
The Detroit News' story on Rick Wagoner's recently professed intention to continue consolidating Buick, GMC and Pontiac dealers is straightforward to the point of wondering why the Hell they bothered. GM's got too many dealers (14,118). Wagoner wants to trim the network. This is news? Alright then, we'll play. Given that all GM dealers are protected by their state's franchise laws, how exactly is Wagoner going to git 'er done? Is the General going to spend [some more of the bank's] billions and buy-out stand alone dealers? Are they going to swing their ax and defend their position in court? Or are they simply going to continue starving Buick/Saab/Hummer/Pontiac of killer product until the brands die of natural causes– or just long enough to force them to consolidate and then turn the models into variations of a single brand? Three brands? Four brands? Inquiring minds want to know! The closest scribe Sharon Terlep comes to providing an answer. ""We do it one and two at a time," GM Marketing Maven Mark LaNeve told her of the consolidations. "Every situation is unique." So now we know.
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