Canadians purchased and leased nearly 43,000 SUVs and crossovers in January 2016. At the same time, fewer than 34,000 passenger cars made their ways to Canadian driveways.

This wasn’t an anomaly. Canadians also registered more utility vehicles than cars in January 2015, and over the course of 2015, only 2 percent more cars were sold than utilities, a margin of only 14,000 sales.

No, it wasn’t an anomaly, but the gap in demand was exceptional. For every passenger car acquired by a consumer, business, fleet, or governmental agency, the industry also recorded 1.3 SUV/crossover sales.

How soon before the U.S. auto industry makes the same claim? In January, as car volume plunged 9 percent and utility vehicle sales jumped 6 percent — despite an abbreviated sales month and an overall volume decrease — cars outsold utilities by just 1.1-to-1. That’s down from a 1.25-to-1 gap a year ago.

In other words, it’s about to happen. Read More >

There’s not a more uncomfortable phone call for a car dealership’s finance manager to make then asking a customer to come back to have their finance or lease contract rewritten. This is typically caused by sales managers — the people most despised by finance departments — who spot deliver a vehicle based on their wrong guess about the rate or term a lender would approve the deal. Needless to say, the vast majority of these rewrites result in a higher monthly payment for the customer.

A couple of years ago, a finance manager at a Los Angeles Mercedes-Benz dealer told me and a Mercedes-Benz Financial colleague of mine about the day he picked up the phone to fix the opposite situation: the dealership had miscalculated the taxes on a client’s lease on a black ML350 Bluetec SUV and they needed the client to return and sign a new lease agreement reflecting payments of $14 per month lower than the original contract.

He called the customer with the good news only to hear, “No no no! Payment good. Payment good. We OK!”

After he hung up, he thought, “We just got snookered. That ML is probably on a slow boat to China and the factory is going to kill us.” Read More >

U.S. sales of utility vehicles increased 16 percent last year. Amidst the modest decrease in volume reported by the industry in January 2016, U.S. sales of SUVs and crossovers jumped by more than 6 percent.

Yet even with drivers enjoying truly low fuel prices, we have not seen a return to the days of full-size, truck-based, body-on-frame SUV dominance in the modern SUV/crossover sector. In fact, U.S. sales of the 10 full-size SUVs which use full-size pickup truck platforms as a foundation collectively declined 2 percent as America’s auto industry soared to record highs in 2015.

And 2016 begins similarly. Two Chevrolets, two GMC, two Cadillacs, and individual nameplates from Ford, Lincoln, Nissan, and Cadillac tumbled 9 percent in January. Read More >

We knew it wouldn’t be easy for them. We knew it would get worse before it got better. But did you know it would be this difficult for Volkswagen of America to sell cars, and did you know it would get this bad this soon?

And could it get even worse?

Volkswagen brand sales in the United States tumbled 15 percent in January 2016, a year-over-year loss of 3,425 units. With barely more than 20,000 total sales, January 2016 sales fell to a 60-month low. Not since January 2011, when Volkswagen sold only 18,401 vehicles in America, has the company generated so little showroom activity. Read More >

Kenneth Feinberg, the man behind Volkswagen’s claims fund, stated American VW TDI customers should expect an offer that will make them very happy in an interview published this weekend.

When asked by Frankfurter Allgemeine Sonntagszeitung (via Reuters) what he will offer the more than 500,000 Americans who own dirty diesels, he replied, “I can promise that there will be a generous solution.”

What that solution will be is anyone’s guess, including Feinberg’s.

“The jury is still out, and at the moment all options are up for debate: cash payments, buybacks, repairs, replacements with new cars,” he said.

Read More >

The fuel cost savings of a diesel vehicle can be huge for those who eat up highway miles. However, with Volkswagen’s voluntary stop sale of those vehicles implicated in the diesel emissions scandal, you may think you can’t buy one from a Volkswagen dealer.

You’d be wrong.

According to a source who spoke to TTAC under the condition of anonymity, Volkswagen dealers are still able to sell an affected diesel vehicle should it meet certain conditions: that it not be a “certified pre-owned” (CPO) or new vehicle, and that the buyer signs a disclaimer stating they understand the vehicle being purchased pollutes more than government compliance tests initially indicated.

Read More >

News that 200 production would instantly end, albeit temporarily, was overshadowed by news that Fiat Chrysler Automobiles would, sooner than later, farm out the design and production of their small and intermediate cars to a rival automaker.

The Chrysler 200’s plant in Sterling, Michigan will undergo a six-week shutdown due to an inventory glut at dealers nationwide. Over the last three months, U.S. sales of the 200, FCA’s best-selling car in the United States in 2015, tumbled 46 percent to only 24,111 units, or about the number of Camrys Toyota sells every 18 days. Read More >

Beyond the funky metal, there’s one element that set Scion apart from its Toyota mothership: monospec pricing.

By offering up only a single trim for each models and reducing options to paint colors, transmissions and accessories, Scion was able to market its vehicles to a different audience and offer a no-haggle sales approach.

For the 2017 model year, that monospec approach will continue, but Toyota is evaluating its future. Also, Scion’s no-haggle pricing model won’t be surviving the transition to Toyota.

Read More >

Is Toyota about to officially murder the company’s fledgling Scion marque? If so, it will be both the exact outcome analysts and observers and fans predicted for years and a surprising turn of events.

After thriving for half a decade prior to the economic collapse, Scion’s poor performance in recent years led us to assume that Toyota would tire of the brand’s inability to turn a corner. But then Toyota finally reinvested in the brand, launching a sports car, a conventional hatchback with the iM, and a new Mazda2-based best seller, the iA.

Only months into the tenure of the two newest Scions, the cars which accounted for six in ten Scion sales in January, Toyota apparently realizes that the potential of the iA, iM, and even a C-HR crossover is insufficient. Joining Geo, Eagle, and Merkur on the scrap heap of failed auto brands launched by large automakers, Scion is killed off just when we thought Toyota had decided not to kill off Scion.

Read More >

FCA’s sweater-in-chief Sergio Marchionne has a plan to turn around the debt-laden and ailing automaker: stop building cars that lose money. That sounds like common sense, so long as oil prices stay low and the demand for trucks, SUVs and crossovers remains high.

But that plan introduces a new set of problems, chief among them the fact that ditching the car market leaves FCA exceptionally exposed to future volatility in oil prices. Crude prices affect prices at the pump, which affects the demand for certain types of vehicles. Sergio is betting oil prices will stay low by focusing on vehicles with ever-increasing price tags and ever-growing gas tanks.

Still, there will always be some demand for small cars. It was true in 1950 and it is true today. So what will Mr. Sweater do to meet that demand? Simple: he’ll buy those vehicles from another automaker and badge engineer them the old-fashioned way.

Read More >

When is a Gregorian calendar not a calendar? When December 2015 ends on January 4, 2016.

AutoNation CEO Mike Jackson brought greater attention to the subject of the unnecessarily convoluted auto sales calendar when, in a conversation with Automotive News reporter Amy Wilson, Jackson said, “It’s ridiculous that I have to get on the air and explain the industry calendar to make sense of sales.”  Read More >

A lawyer for Volkswagen said in court that the automaker would buy back cars that it can’t fix in time, the first admission from the company that some of its cars may not be fixable, according to the New York Times.

Volkswagen lawyer Robert Giuffra told a court last week during hearings related to the class-action lawsuits facing the automaker that the company hadn’t determined how many cars would be affected.

“We might have to do a buyback or some sort of a solution like that for some subset of the vehicles, but that hasn’t been determined yet,” Giuffra said according to the report. Read More >

An Illinois sheriff knows a barn find when he sees one.

According to the Northwest Herald, McHenry County Sheriff’s Deputy Mike Stadler spotted an old parade Chevrolet Caprice with 4,000 miles gathering dust in a shed and decided to bring it back into service.

The 20-year-old, LT1-powered police cruiser — which sports none of the modern police cruiser amenities including USB ports, massive touchscreen or even traction control — was pressed into service when Stadler’s Impala was retired.

“I could see the diamond in the rough,” Stadler told the newspaper. “Your non-car person would look at this thing and think, ‘Why would I want this 20-year-old thing covered in dirt?’ Where I was, ‘I really want to clean this thing up.’”

Hell yes. Read More >

Fiat Chrysler Automobiles CEO Sergio Marchionne on Wednesday said the automaker would rely more heavily on profitable Jeeps and Rams in North America and Europe to help its business remain profitable in other sagging areas and regions.

“We are not of the view that this industry is facing an impending demise,” Marchionne said before announcing FCA’s adjusted earnings of $1.78 billion in the fourth quarter.

Marchionne and CFO Richard Palmer said Jeep’s success in North America and Europe led the company last year and would be the “bedrock” for the automaker’s future. The automaker laid out specific plans to bring forward a Jeep pickup and Wagoneer, and let wither less-profitable models such as the Chrysler 200 and Dodge Dart. Read More >

In the war for ever-lucrative pickup truck money, conspicuous consumption is key. General Motors’ latest salvo in the pickup arms race has mudders, LED lamps, a spray-in bedliner and the letter “X” in its name, jack.

GMC announced Wednesday that it would sell this spring a Sierra 1500 All Terrain X package, which is derived from its All Terrain trim, and includes a handful of goodies thrown on at the factory instead of at the dealership to pry a few more hundred dollars out of the burning pockets of pickup buyers.

Interestingly, the All Terrain X package is available on its 5.3-liter V-8 (with performance exhaust!), not the hi-po 6.2-liter V-8 because product planners will have a name for that later. Read More >