In the merry month of May, Germans celebrated their new-found love for das Auto. Europe’s largest auto market grew 22 percent year-on-year and 14.4 percent month-on-month. That according to just released statistics by the German Kraftfahrtbundesamt. Read More >
Yes, ladies and gentlemen, the “Detroit Three” automakers are once again on top of the charts, as a wild and wacky month of sales closed with some serious shifts in the volume-manufacturer landscape. Not only did Chrysler claw its way back to number three for the month, but Hyundai-Kia beat out all the Japanese competition save Toyota, which narrowly escaped with the top non-Detroit volume number. Detroit fans should savor the win, as the Japanese automakers should work through most of their inventory and supply issues by sometime this summer. Things should get back to (relatively) normal at that point, but for now it’s clear that literally anything is possible.
Analyst forecasts for Maywere perhaps a little bearish on Ford and a little too bullish on GM, as the two remaining American automakers saw their volumes drop by 3% and 1% respectively (year-over-year) last month. Pickups seem to have been the highest hurt by high gas prices, as GM’s full-sizers dropped 14%, while Ford’s F-Series dropped 15% despite a 55% mix of Ecoboost V6-powered F-150s. But the real losers in May’s downturn were probably the Japanese automakers, whose numbers are just starting to come in, while the biggest winners appear to be the luxury brands, with Porsche up 50% and Maserati up 36%. Check back often as we update our developing table of US auto sales in May.
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Sales of new cars, trucks and buses in Japan dropped 37.8 percent from a year earlier in May, data released by the Japan Automobile Dealers Association show. It could have been worse. Read More >
May sales estimates are out, and the analysts are seeing slowdown in their crystal balls. Reuters reports that its survey of leading auto analysts projects a 12.6m SAAR (Seasonally Adjusted Annual Rate) for the month, while Bloomberg is projecting a 12.1m rate. Wherever the actual number lands, it is likely to be the first month this year below a 13m SAAR, as Japanese supply interruptions as well as model changeovers lower overall supply. But, reports the WSJ [sub], there’s evidence that perceptions of undersupply are possibly keeping consumers away from showrooms as much as an actual shortage of vehicles. A Honda dealer who says he has plenty of cars for sale is quoted as saying
Traffic is down and I think it’s the media effect. People think there’s no cars and they think there’s no incentives, so they’re waiting.
And that’s not all: it turns out that May’s downbeat forecasts could have an even deeper cause…
Though the auto bailout is being widely defended in the political realm as a jobs-saving measure, the industry sees the rescue’s value in precisely the opposite light, as industry and supplier execs rate “capacity rationalization” as the most positive effect of the bailout. And, reports Automotive News [sub], Ford and GM could still end up cutting as many as six more plants over the next few years as questions linger about volume recovery in the larger market. Of the three GM plants likely to be shut down, the former Saturn plant at Spring Hill, TN, is the most likely to survive as it includes a paint shop, a small engine plant and associated parts manufacturing facilities. In contrast, analysts note that GM’s Janesville, WI, plant is the firm’s oldest and is therefore far less likely to survive, and its Shreveport, LA, compact truck plant is part of “Old GM” and will likely be liquidated. Similarly, Ford’s Ranger plant in Minnesota, as well as its Avon, OH Econoline plant and its Flat Rock, MI Mustang plant could face shutdowns. Ranger is running out of production, Econoline has been losing share to Ford’s more-efficient Transit Connect, and Mustang has been losing market share to Camaro while facing a Mazda pullout from the Flat Rock plant.
Because GM is adding jobs at other plants, the net job loss from its three likely shutdowns (two of which are currently idle) could be relatively low, but then cost savings aren’t likely to match those accrued by past shutdowns either. Ford, meanwhile, is facing a bit more disruption if Mazda pulls out of Flat Rock, but could accrue more savings than GM as only the Ranger plant is scheduled to lose its production. In any case, the UAW will have to weigh its desire to keep plants open with its desire to mitigate the inequity of the two-tier wage system… as well as its desire to gain board seats. All of which could make the UAW’s upcoming bargaining session (not to mention the political debate about the auto bailout) much more interesting…
No, this is not another installment of Steve Lang’s “Lease, Rent, Sell or Keep?” series. Wards Auto is reporting that Toyota facing a decision over whether to kill its Matrix hatchback when a new version of the Corolla on which it is based debuts sometime “before 2013.” Toyota’s Bob Carter tells Wards that
There’s no change right now on the car, (but) we haven’t made the decision yet
So, what to do? Toyota doesn’t break sales of the Matrix out from the Corolla, but according to Wards:
The hatchback reached its pinnacle in 2002, selling 66,836 units, Ward’s data shows.
Annual deliveries have declined since then, except for 2008, the second-generation model’s first full year.
However, Matrix volume plunged 47.3% to 26,121 in 2009, from 2008’s 49,567, and last year slid 44.5%, with only 14,492 deliveries.
Toyota’s Carter insists that the forthcoming “Prius C” compact hatch “attracts a different type of buyer,” an argument he’d probably also apply to the Scion xB, another Corolla-based hatchback. So, should Toyota develop a new Matrix along the lines of its predecessors in hopes that the third iteration brings back some magic to the nameplate? Or, would a re-styled xB make a better Toyota than Scion, opening up Scion’s lineup for a version of the Verso-S? Or perhaps Toyota could offer its European Auris as a Hyundai Elantra Touring-style contrast to the very American Corolla. Or, Toyota could look to the Verso for a larger, more utilitarian alternative to a traditional Matrix.
In any case, with so many possible options, it’s no wonder Toyota hasn’t made a decision yet…
Hit by the March 11 earthquake and tsunami, exports of Japanese motor vehicles plummeted 67.8 percent from a year earlier in April.This according to data released today by the Japan Automobile Manufacturers Association. The quake hit all companies, although not equally hard … Read More >
A lengthy Automotive News [sub] story on Scion concludes with Scion VP Jack Hollis restating the brand’s basic myth:
Scion was not created for Scion’s sake. Scion was created for Toyota’s sake. It is an investment in Toyota’s collective future.
Hollis’s argument is bolstered by the scenario in which a youngster is attracted to a Scion store by the brand’s youth-oriented marketing, only to leave in a Corolla. Hollis argues that this model means Scion doesn’t have to worry about its sales volume… which is a good thing, considering the brand’s steady sales decline over the past four years. Hollis explains:
We still don’t go with a set [volume] number. Scion wants to be more influential. We want to talk to more people. We’re getting the right people, so the real question is: How do we get more of them?
I don’t know about you, but creating a brand to be “influential” and to “talk to more people” sounds like some vintage, dry-aged, old-school GM branding nonsense. And given that Scion’s sales decline coincided with the rollout of less-distinctive, more Toyota-like products, Scion’s apparent comfort with its recent declines smack of Old GM-style apathy as well (Scion execs respond with the old “but we gave customers what they wanted” chestnut). But don’t worry… Scion has a plan!
Supposedly, the Chinese car market is doomed and has crashed into its Limits of Growth. Not so, says Audi. China has turned into Audi’s largest single market, says Automobilwoche [sub], bigger than Germany. By the end of April, Audi had sold 78,487 Audis in Germany. How many were sold in China? Read More >
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There is a war of opinions over the direction of the Chinese car market. Bloomberg says that “China’s auto sales may fall 10 percent this year with the end of government stimulus policies and restrictions on car licenses, according to the China Automotive Technology & Research Center.” Bloomberg’s colleagues at Reuters called Chen Hong, President of China’s largest automaker SAIC as a witness. He expects the Chinese car market to grow 7.4 percent to end up at 19.7 million units by year’s end. Who’s right? Who’s wrong? Read More >
TrueCar released its May 2011 sales forecast. At this time in the calendar, these forecasts, based on real transactional data, usually come close to reality. For May 2011, TrueCar expects new light vehicle sales in the U.S. to be 1,060,392 units, down 3.7 percent from May 2010 and down 8.3 percent from April 2011(unadjusted basis for sales days). This would be a Seasonally Adjusted Annualized Rate (SAAR) of 11.85 million new car sales, down from 13.18 million in April 2011 and only slightly up from 11.63 million in May 2010. Why the sudden reluctance? Read More >
Though an global Accenture study [via Green Car Congress] found that up to 68% of respondents would consider a plug-in electric vehicle for their next purchase, the issue of range continues to be the great unknown. And unfortunately for all the models and predictions of future EV sales, the issue of range points to some severely irrational consumer behavior. Namely, there’s a giant disconnect (nearly ten-fold in fact) between the actual number of kilometers driven each day and the range expectations for future EV purchases. Meanwhile, 62% of respondents rejected battery swapping, the most credible current solution for range anxiety, for reasons that are not immediately clear. In short, Energy Secretary Chu had beeter be right when he says EV range will triple and costs will be reduced over the next six years… otherwise, EVs will die a quick death at the hand of consumers’ outsized range expectations.
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