In the WTF dept., “Hyundai Motor India is planning to shift production of one of its premium models to Europe after a strike over unionization at its south India plant that led to the mass arrest of 750 protesters,” reports Financial Times.
The move reflects growing skepticism of international automakers about the political climate in what used to be one of the world’s most promising growth markets.
The Motor Authority reveals that Cadillac has spiked the STS-V model for 2010. The high-performance variant of the brand’s slow-selling flagship (who knew?) joins the Impala SS, Cobalt SS and Pontiac G6 GXP in model heaven (purgatory?). The SS moniker will live in in the hearts and minds of students of Jewish persecution and fans of the new Chevrolet Camaro. As widely reported elsewhere, GM CEO Fritz Wagoner Clone Henderson specifically highlighted the fact that GM was NOT going to drop the Corvette from its shrinking roster of performance-oriented brands—I mean, products. This despite slow sales, a ruling Presidential Task Force on Autos that keeps mentioning the words “small” and “fuel efficient” (yes, I know), and the fact that the in-house fanzine “Corvette Quarterly” has published its last paean to pistonhead perfection, or a reasonable facsimile thereof.
Recent reports that GM won’t even let the fanboys drive their Volt mules in the all-important range-extending “generator mode” were troubling enough, but recent chatter from inside GM suggests that maybe Chevy should have simply designed the Volt as an electric-only vehicle. “It’s best utilized in urban vehicles,” GM Product chief Tom Stephens explains to Automotive News [sub]. “We have to consider what is the usage of the person buying the vehicle. For a commuter who drives 40 miles a day and takes it shopping on weekend, it’s the perfect application.” Yes, and a Hummer is the perfect vehicle for those who want to practice counterinsurgency tactics on the weekends, but the market doesn’t necessarily reflect that, does it? No, it’s image über alles at GM. Is it any surprise then to learn (via GM-volt.com) that the Volt was originally imagined by Bob Lutz as an EV-only city car?
All’s not well with Turtle Wax. To wit: in a recent Piston Slap article, numerous commentators made less-than-flattering remarks about the brand’s products and image, indicating that Turtle Wax is suffering a dramatic loss of brand equity. It’s a big problem at a bad time. Last October, 3M acquired Meguiar’s. Barry Meguiar is a tireless and charismatic promoter who’s deeply in tune with care care gestalt. With the normally staid Triple M’s enormous resources behind him, the Divine Mr. M could put a serious hurt on Tommy the Turtle. It’s time to put the terrapin’s marketing under the microscope.
China’s new car sales come roaring back. After a strong first quarter, China’s passenger car sales, including minivans, rocketed up a whopping 44.5 percent in April from a year earlier. Shen me? (Excuse me?)
Detroit apologists—who sincerely believe that GM was headed for turnaround town when gas prices ascended and the worldwide economic tsunami hit—will take pleasure in the fact that Toyota reckons it’ll spill $8.6 billion worth of red ink on the corporate carpet. No doubt, the Japanese automaker is “struggling” to cope with the loss of one million units from their worldwide balance sheet. During the January to March Japanese fourth quarter, the formerly unassailable automaker got assailed but good, losing $6.9 billion. As we’ve reported previously, the US and Japanese markets are ToMoCo’s big hole, switching from huge profits to equally enormous losses without much of anything in between. As Automotive News [sub] reports, the head of the ailing automaker had a completely different response to the news of his employer’s sinking fortunes than, say, anyone who works for GM. [GM cheat sheet: the secret word is “accountability”.] “Of course the external environment doesn’t help,” Toyota president Katsuaki Watanabe told reporters. “But we were lacking in the scope and speed of dealing with various problems and issues, and for that I am sorry.” So . . . now what?
Nante hazukashi! (How embarrassing!) Japanese car manufacturers show very bad manners and use red ink in their books.
Fuji Heavy, makers of Subaru, posted its first net loss in 15 years in the fiscal year ended March, the Nikkei [sub] says. Resposible? The usual suspects: Sluggish consumption, tighter conditions, a drop in vehicle sales in all major markets, and the yen’s rise.
Fuji Heavy posted a net loss of ¥69.93 billion in the fiscal year ended March 31, sharply down from a net profit of ¥18.48 billion a year earlier. Says the Nikkei: “For this fiscal year, Fuji Heavy, in which Toyota Motor Corp. owns a 16 percent stake, projects a net loss of ¥55 billion, operating loss of ¥35 billion and sales of ¥1.320 trillion, with auto demand likely to remain stagnant and the yen strong.”
So the United States finally gets the Nissan Cube, a funky, cool box. From initial impressions, it provides a unique and entertaining driving experience. Meanwhile, here in Western Europe, we get the Nissan Note, a Micra front-ended, Renault Modus-derived piece of crap. To say that I longed for a basic Ford Focus after driving this from Trier all the way to Maastricht, down to Luxembourg, and then back to Trier says a lot. The Note made me angry, so angry in fact that I actually contemplated sabotaging the thing so Sixt Car Rental would replace it. But then I realized they’d probably hand me the keys to yet another sour Note.
Didn’t this just happen a short year ago? Or was it all a dream?
Most folks don’t know a Pontiac Torrent from a Joe Torre. Those of you immersed in the labyrinth of automobilia know that the former is a glorified shitbox. But everybody else? Not so much. By the same token, there are some excellent cars that don’t appear on the new car buyer’s radar. Terrific vehicles that get lost in the shuffle of pointless new names and missing marketing campaigns. As Buickman will tell you (and tell you and tell you), there are an awful lot of excellent cars that don’t get the attention they deserve and therefore don’t sell. And when they do sell, they depreciate alarmingly. Even when the chips are down, or especially when the chips are down, used car buyers are far more conservative than their new car counterparts. Unfamiliarity breeds contempt.
Tom Blumer, in the WSJ, says, “Non-TARP Lenders Aren’t Making Up the Stories of White House Pressure,” citing conversations with anonymous Non-TARPies. According to these former holdouts, still masked and anonymous due to fear of reprisal, government officials went to the mats to pressure bondholders into compliance. Seeing as the group has dwindled from twenty to five since Obama called the group “hedge fund holdouts,” these tactics seem to have been highly effective. GM bondholders, pay attention (if you aren’t already).
The Wall Street Journal has got its mitts on a document detailing Fiat’s plans for world automotive domination and can reveal that the name for Sergio Marchionne’s plan is “Project Phoenix.” The plan reportedly calls for Fiat to take over Opel, Vauxhall, Saab and GM’s South African operations in addition to the Chrysler brands. Fiat would spin off this new auto empire into a new entity which would also include the Fiat, Alfa Romeo and Lancia brands, but not Ferrari and Maserati. Fiat would also close GM Europe’s plant in Luton, UK, and cease operations in Graz, Austria. The payoff? Annual savings of around €1.4 billion from 2015 onwards, according to Fiat’s estimates. The downside? A high chance of epic failure.
As Top Gear puts it, “the HS250h is a rebodied, higher-performance Prius. It’s made for the US market, and was introduced at the Detroit show in January. It is hideous in profile . . . luckily, we won’t be getting it.” They say “luckily” because their version will be an Audi A3/BMW 1 series-fighting compact hatchback. But why make two? In fact why is Lexus competing for the European market at all? Lexus Europe boss Andy Pfeiffenberger offers a confused roadmap. “Our hybrid saloons are going up against the V8 diesels in Europe. In future we need to compete against the four-cylinder diesels. So we will enter new sectors with low-displacement hybrids. The C-premium segment is the fastest growing segment and we must be in it.” Huh?
President Obama gave the dying ethanol industry a huge shot in the arm Tuesday when he announced that over $780 million of stimulus money will be spent on biofuel “research and commercialization,” guided by an all-new Biofuels Interagency Working Group. Think of a giant, government-funded R&D/marketing department for the ethanol industry, and you’ll have some idea of what we’re looking at. “We need to work in concert with the industry to figure out how to do a better job to create a market for biofuels, how to increase the use of flex-fuel vehicles, how we can assist those who market, and to coordinate the infrastructure, and do all this in a sustainable way,” says Agriculture Secretary, Tom Vilsack. Unfortunately “creating a market” isn’t easy. The US already spends more on ethanol subsidies than any other renewable energy source, and has been rewarded only with crashing ethanol demand and rampant refinery bankruptcies. Good thing hope springs eternal in the breast of K Street.
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