Whatever else you can say about the aspiring electric vehicle (EV) maker– and we've said plenty during the previous thirty-nine installments– you can never accuse Tesla Motors of humility. Before they've delivered a single car to a single paying customer, Tesla is now talking about European sales. Innovation Beat carries the glad tidings. "We have always wanted to distribute in Europe, but with the low dollar we are going to move quicker,” says Darryl Siry, Vice President of Sales, Marketing and Service at Tesla. “The introduction date for the Roadster in Europe will be announced in a couple of months.” Will that be that before or after the White Star sedan EV prototype hits the streets? Meanwhile, Wired reports that Siry was equally vague about the delivery date for the second "production" Tesla Roadster. "The factory turns out 'gliders,' or rolling chassis without drivetrains. The cars will be shipped — Siry said he imagines [Tesla founder Martin] Eberhard's car will be flown — to San Francisco for final assembly. Every Roadster will have its battery pack, transmission and motor installed in San Carlos. 'The whole process before they're passed to sales takes a couple of weeks,' Siry said, and Eberhard will probably get his car in April.'" Probably?
Posts By: Robert Farago
Back in August '06, GM announced "Value Pricing" policy. Yes, well, Edmunds.com reports that cash back and special financing offers are back, and they're big. "Incentives have been boosted to the levels we saw regularly before automakers instituted the 'value-pricing' strategy that aimed to reduce sticker prices and minimize the need for incentives." The Dallas Morning News has the list, and it ain't pretty for profits. While you'd expect the arthritic Mercury Marquis ($6500) and lame duck Dodge Ram ($5k) to offer incentives, the Explorer's $4k, Focus' $2k and 300C's $2k has got to hurt. Even the highly-touted Cadillac CTS (1.9 to 4.9 percent) and Malibu (5.9 to 7.9) are using financing to help move the metal. The transplants are playing the game as well; the struggling Nissan Titan comes with a $5k come-on and the new Toyota Tundra slaps up to $3.5k on the hood, or zero to 3.9 percent financing (which Box forgot to mention). Overall, the numbers tell a familiar tale. "In its most recent assessment, Edmunds.com found that the average incentive in February for the Detroit Three was $3,393 per vehicle, while European brands spent an average of $1,945 per vehicle sold, Japanese brands averaged $1,313 per vehicle sold and Korean brands spent $1,807." Not that the average American Lexus buyer could give a damn, but Toyota's luxury division has singularly failed to gain traction outside the U.S. market. Which is exactly the point: Americans are far less bothered by issues of provenance (i.e. or lack thereof) than any other developed automotive market. Business Week reports that the analysis applies to Lexus' home turf. "When Toyota (TM) introduced its Lexus brand in Japan three years ago, the company was hoping drivers like Masayoshi Haku would swoon over the luxury lineup. The 46-year-old doctor is a car lover with a $110,000 BMW 750 sedan and a $60,000 Porsche Boxster, so he should have been a prime customer for Lexus. But Haku hasn't taken the bait. Why? Lexus is too Japanese for his tastes… 'Foreign brands have more individuality.'" Sales reflect this non-import bias; Lexus sold just 34,800 cars in Japan last year. As Biz Week points out, Lexus did itself no favors with its initial lineup, featuring "the $52,000 GS sports sedan, the $68,000 SC convertible, and the entry-level IS sedan, starting at about $40,000. All three had previously been available in Japan under the Toyota nameplate— for about 20% less than the Lexus models." Oops. [thanks to stalightmica for the link]
From TTAC reader Ian Opp: "With all the talk about gas prices, etc. why is mid grade still being manufactured? I understand that most cars are either biased towards reg or premium, so wouldn't it behoove us to scrap the whole idea of an 89 octane?" To which I'll add a sub-question: what about substituting an E85 pump? According to the the ethanol industry, you can get better fuel economy with ethanol than regular gas. No, really; they actually want you to believe that. Check out this study from The American Coalition for Ethanol (link to the full report at the bottom of the press release). Are you craving corn juice?
In his first conference call with automotive analysts, freshly-minted GM CFO Ray Young said that his employer has $27.3b in cash and $7b in undrawn credit lines upon which to draw. Although that ain't hay, subtract the $10b GM needs to keep the lights on, consider the company's ongoing cash conflagration, factor in declining sales and the American Axle strike's effect on cash flow, remember that GM lost $10.6b in 2005, keep in mind that GM's already sold the family silver and… the automaker's liquidity isn't quite so reassuring. But don't take my word for it. "As CFO, my priority is making sure this place is funded," Young said. "While we believe the industry (in U.S. sales) will be in the low 16 million units, we have triggered actions right now to make sure we start to conserve liquidity." Automotive News [sub] reports that GM's Beancounter-in-Chief revealed that GM is postponing [unspecified] non-product related capital expenditures from the first half of '08 to the latter half of the year– and beyond. "If the market doesn't return, we will defer that further into the future," Young said. GM's CFO said the suits are now running the business on a "quarter-to-quarter" basis. Oh, and Young said that GM ran about 940k units of dealer stock the end of February, roughly 125k units below the level at this point last year.
First of all, I apologize again for the broken comments function. As a survivor of the early PC, I know the agony of dysfunctional if not downright evil computing. As a smart ass kid in a school where corporal punishment wasn't the name of a porn star, I know the frustration of not being able to speak the truth. Thanks for all the emails giving us a heads-up, and your patience awaiting the site's restoration. Second, a big thank you to Justin for his sterling work at the New York Auto Show. I still think I should have "accidentally" fallen and grabbed the sheet covering the Hyundai Genesis concept while Justin just "happened" to be taking some photos of the liggers. But otherwise, Justin's editorial judgment is pure TTAC, AND the guy's a hard worker who knows his onions. Well done that man. And kudos to Frank Williams for holding down the fort. We literally couldn't have done it without him. I'm proud that Frank considers TTAC a worthy place to hang his hat. And, of course, thank you for your e-patronage, our raison d'etre.
TTAC commentator (and now unintentional blogger) Lichtronamo dropped us an interesting email, which we reprint for your dining and dancing pleasure: "I was reading a Saturn brand Special Advertising Section in the April 2008 Automobile magazine (starting on page 40 and ending at page 53). On the last page, I caught this little nugget of info re: the Saturn brand: "Saturn was named for the rocket, not the planet". This raises at least two questions: 1. Wasn't Oldsmobile the "rocket" brand when Saturn was first launched (both the real rocket and the car brand, I guess)? 2. If Saturn was named after the rocket and not the planet– as suggested by the ad– then why is the Saturn logo a stylized image of the planet? Rethink that! [Note: if you come across a TTAC worthy item– in the media or real life– email robert.farago@thetruthaboutcars.com, including your user name.]
One of TTAC's Best and Brightest asked the obvious question: "is Lawrence Ulrich working for you secretly?" Nope. It's just that love is breaking out all over for the new Pontiac G8 pickup ute sport truck thingie. More specifically, The New York Times car hack asks "Who exactly was clamoring for a two-seat, gas-guzzling pickup with the cheapest-looking interior this side of a Motel 6?" [NB: TTAC would have said "Who the Hell…"] The Wheels' description of the G8 without the rear seats is plenty pithy: "The 6-liter V-8 from the G8 sport sedan, good for 361 horsepower and a 0-60 time of 5.4 seconds. The 74-inch cargo bed can handle just under 1,100 pounds, and there’s a 3,500-pound towing capacity. Now, if it could only tow itself away." Ulrich describes the "we don't know what to call it so you do it" Aussie import as "Like Hell Camino: a pointless hodgepodge that’s worthy of an expletive-filled diss from 50 Cent himself." [thanks to Nicholas Weaver for the link]
General Motors may be singularly unwilling to tell its shareholders and stakeholders when the company will return to profitability (or exactly how they're going to get there), but they're happy to announce a three-year plan for their annual ad spend. And the winner is.. online media. GM says it will allocate fully $1.5b of its $3b annual advertising budget to the Internet. The revelation keeps the death knell pealing for newspapers. According to followthemedia, GM's 2007 online display ad spend clocked-in at somewhere between $193m to $208m. At the same time, America's most profligate auto advertiser trimmed newspaper advertising by 32 percent, to $149.3m. The new Internet-heavy target will also eat into TV advertising. And where GM leads– in ad spending anyway– other automakers follow. "You know it’s getting dangerous for traditional media," scribe Steven Stone wars. "When the likes of Joel Ewanick, Marketing VP for Hyundai Motor America, says, 'Online is getting to the point where it may be more important than the 30-second spot.'" So look for GM advertising on TTAC soon. In other news, Hell is getting chilly.
Speaking at the Morgan Stanley Global Automotive Conference in New York, Ford CEO Alan Mulally confident predicted that Ford's global rationalization (i.e. same vehicles, different wrappers) will allow the embattled automaker to make money on its small cars in the American market (providing they sell enough of them). The AP [via The Houston Chronicle] reports that Big Al told the assembled throngs he'd been surprised (surprised I tell you) by the complexity of Ford's assembly process. "For instance, the Lincoln Navigator large sport utility vehicle had 128 possible console combinations," roughly one per customer [kidding, I think]. Since taking the reins, Ford has reduced complexity by "up to 80 percent" on "some" models. "You can imagine what that means to the cost structure worldwide," he told the analysts, who tend to prefer hard numbers to vague assurances. Still, Mulally confidently predicted– well "hopes"– his employer will equip 500k vehicles per year with EcoBoost engines by 2013. "It's absolutely going to be a competitive advantage," Mulally asserted. Meanwhile, FoMoCo's CEO conceded that "Ford's market share in trucks and sport utility vehicles has slipped recently, which he attributed to competition." So now you tell us.
Good news! The April issue of Ethanol Producer Monthly (EPM) is already online! Actually, if Sarah Smith's article "Ethanol's Excedrin Headache: Where Have All the Good Sites Gone?" is anything to go by, the news isn't that great for the mag's target market. EPM has identified organized ethanol plant protests in 14 states. "Rural communities that once heralded the arrival of an ethanol plant are now thumbing their noses at them." Before listing litigation from California to Wisconsin, Smith gives ethanol boosters a quick course in how not to win friends and influence people. "Plaintiffs swap strategies over the Internet, trade petition forms, success stories, failures, even going so far as to design T-shirts and coin the perfect acronym for their groups. Their reasons for filing causes of action are as myriad as the ethanol technology itself: not in my back yard, zoning board decisions, economic benefit, industry distrust, environmental concerns and water use issues. The view from the third tee box, listed in one cause of action, illustrates the lengths plaintiffs will go to halt a project in its tracks. After all, golf is life, isn't it?"
It turns out we got it semi-wrong when we reported that FoMoCo's new tagline is "Ford. Drive One" (pearl two). Wandering around their auto show stand, it's clear The Blue Oval Boyz' marketing mavens are hedging their bets. They're rotating their taglines a la Nissan (Shift BLANK), Pontiac (is BLANK) and Mercedes (BLANK like no other). Three separate LCD's proclaim three separate reasons to drive a Ford product: "Drive Smart," "Drive Green," Drive Safe." (It hardly seems likely that Ford will stop at three taglines, so feel free to suggest further variations on the theme below.) The lack of a single sales message does not bode well for branding, but it certainly should satisfy the divisional mandarins within Ford's Byzantine bureaucracy (our turn!). Meanwhile, a word of warning to prospective Flex buyers: if you want to put adults in the way back, opt for the convex non-sunroof sunroof option. Otherwise, neck compression is a given.
"Farago better cover his ears," former TTACer Chris Paukert said, kneeling by one of his colleagues in the floor of the press room. As if. Turns out Porsche has issued a cease and desist order against Paukert's current employer, windingroad.com, after the website referred to the new Solstice hardtop as a "Solstice Targa." Within hours, the automaker sent a legal document ordering them to stop using the word "Targa" for anything other other than a Porsche Targa (named after the Targa Florio). They "suggested" the alternative: "T-top" or "removable glass roof." While we understand Porsche's Kleenex-like desire to protect their model nomenclature, perhaps a quiet word in the website's proverbial ear would have sufficed. We also wonder if Porsche would have been satisfied if Winding Road had used a small "t" instead of a capital "T." I know: let's see what happens. Solstice targa. Anything? Just for fun: Solstice Targa. Frank, put Ms. Brown on standby.
Yesterday, Justin and I caught wind of GM Car Czar Bob Lutz' private pow-wow with bloggers attending the New York Auto Show on GM's dime. Christopher Barger, GM's Director of Global Communications Technology, barred our way. "It's invitation only," Barger announced. "Thirty-five is the limit." I asked Barger if he was TTAC-aware. "Sure, you guys hate us." So I waited in the hallway and collared Maximum Bob. I introduced myself and asked permission to attend. "Do we know these people?" Lutz asked. "Do we like them?" "It's up to you," a stunned Barger replied. We were in.
Gentlemen racers will be delighted to hear that MINI is thinking about, going to, we'll tell you tomorrow during the OFFICIAL LAUNCH, run a MINI Challenge race series stateside, And here's the chariot its participants will be flogging: the MINI John Cooper Works Challenge MINI. The world's fastest factory-authorized, non-street legal MINI boasts 208 horses @ 6000 rpm, with an extremely useful 192 ft.-lbs. of torque @ 2000 to 5100 rpm. She'll top out at 147 mph and offers a delightful overboost feature. In race trim, the extra oomph lasts 15 seconds. As MINI never met an accessory it didn't want to sell at an enormous profit, look for some of the race mods to make their way into the street iterations. If they're not there already.
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