The Freep has dubbed Chevy’s Next Big Small Thing a “hit” on the grounds that it’s big in Australia. The only problem? It’s not really selling all that well. Towards the bottom of its write-up, the Freep reveals that GM’s Holden division sold 4,826 of the US-bound Cruze in the last three months. Center for Automotive Research president David Cole reckons those numbers “kind of give you a clue as to what the potential could be” when the Cruze arrives stateside. If that’s true, the Cruze is a loser. Not only has Toyota sold 7,550 Cruze-class Corollas in the last two months, the Mazda3 and Hyundai i30 are also the segment’s fastest growers.
No surprise there. Any automotive analyst worth their salt could have told you—did tell you—that Uncle Sam’s $3 billion Cash for Clunkers program was going to suck the oxygen right out of the showroom. Really, this is one for Johnny Carson. HOW BAD ARE THEY? They’re so bad that salesmen who boast, “You ain’t seen nothing yet!,” know they’re being ironic. Pause. The Associated Press doesn’t “do” irony. (Nor, apparently, sales stats.) Still, their article on September’s new car sales drought is not without merit, suffused as it is with Glengarry Glen Ross-type quotes from starving dealers, caught in the no-man’s land between no inventory and no customers. Here’s the stripper version . . .
Following on from Honda’s loss of Facebook over the Crosstour—or loss of Crosstour over the Facebook— here’s another story where the web pulls the rug from under auto industry types seeking to hide the truth. We’ve been saying it forever (in Internet terms): the collector car market has collapsed. Well, duh. But the mainstream media and specialist press has both been happy to perpetuate the myth perpetuated by the auction houses that their business has been defying gravity. See? Cars are selling for phenomenal prices! Meanwhile, Hagerty’s CARS THAT MATTER (must do, given the shift lock situation) is telling readers to pay attention to the men behind the curtain.
Since last January, JamesList.com has been offering a no-nonsense marketplace for buyers and sellers of upmarket chazzerei. Contrary to the media’s “teflon mega-rich” meme, website co-founder Noam Perski reports that tough times have quelled demand for your garden variety “ultra-luxury” automobiles (e.g., Bugatti Veyron, Rolls Royce Phantom). Perski says the slow-down lowered prices for pre-loved examples by some 18 percent (from May to September ’09). So far. “Prices for high end cars stayed firm until three to six months ago, but few deals were being done.” The good news: “When owners ask for less money, the goods are moving, indicating that we may be nudging the bottom of the market.” Or not. Meanwhile, further up and down the scale, its a different story . . .
I hope our good friends over at Autoblog don’t mind me stealing their headline, but it illustrates my point about domestic automakers and their camp followers: they are seriously deluded. While you can’t fault New GM, New Chrysler and Mortgaged-Up-to-Their-Logo Ford for seizing good news like an iron chef stumbling over a plump, truffle-snuffling pig, the future’s not bright and they’re still wearing shades. While surveys like Consumer Reports headlined above may contain a kernel of truth and rally the troops, taking them as gospel instills, reinforces, and engenders company-killing complacency. I invite TTAC’s Best and Brightest to data dive this bad boy. Meanwhile, Michael Karesh: “Automotive News [sub] notes that, while Asian brands’ market share is 48 percent so far this year, only 47 percent of survey respondents reported that they would probably consider an Asian brand car in their next purchase. Two steps up the purchase funnel (might consider ⇒ do consider ⇒ buy), the percentage should be much higher than the final percentage. That it’s not suggests a sampling error.” Also, define “considering.”
From the “Again. Still.” files, comes word that Hyundai and Subaru are once again the sales kings in terms of month-on-month improvement. Hyundai‘s numbers jumped 47 percent compared to last August, on C4C-fueled increases in Accent, Elantra and Santa Fe sales. Even Genesis sales about doubled. Hyundai’s total sales volume topped 60k units, an all-time record for the Korean brand. Subaru‘s sales were up over 50 percent, led by the Forester’s 76 percent gain. Only the Tribeca failed to improve on last August’s sales, falling 8 percent.
Daily selling rates are playing silly buggers with some of this month’s sales results, but the numbers in the headline reflect Automotive News [sub]’s calculations on a pure monthly basis. Since both Toyota and Honda‘s official numbers are based on DSR though, they come out a bit higher. Either way, both firms saw increases in popular Cash For Clunker models, while trucks and luxury brands continued to sell slowly.
Ford received a huge boost from Cash For Clunkers, with Fusion (+131 percent), Focus (+55.9 percent), Flex (+106.5 percent), Escape (+49.3 percent) and Ranger (+57.4 percent) seeing huge sales increases. Taurus didn’t see a big boost from its new-model rollout, logging only 3,398 units of sales, a nearly 24 percent decrease. Edge edged up by 8.9 percent and Mustang dropped by 23 percent.
Unlike Chrysler, GM reaped substantial increases in small-car sales from Uncle Sam’s short-lived Cash For Clunkers program. And yet, Chrysler-like, the boost still couldn’t give GM a month-on-month sales increase. A 160 percent jump in Aveo sales can’t hurt; volume topped 12k units. The equally reviled (at leastin these parts) Chevrolet Cobalt was also up by 13.8 percent. The hecho en Mexico HHR up 26 percent. Malibu sales rose by 11.1 percent. The new Equinox got off to a hot start, moving 13,157 units. The last of the Pontiac G6s were hustled out the door, as volume rose nearly 26 percent to 13,133 units (Vibe up 38 percent). Otherwise? You better have plenty of room set aside in the “not so good” column.
Even in the midst of an overstimulated car market there’s always an excuse for underperforming. Chrysler is blaming overzealous production cutbacks and dealer shortages for its 15 percent month-on-month sales decline in August. Grand Cherokee had a surprising 62 percent increase in sales compared to last August, while 300 sales improved 17 percent. Otherwise, sales were down across the board. The TTAC-slated Aspen dropped 83 percent. The long-in-the-tooth Durango dropped 86 percent. And Challenger sales continued their freefall, falling by 45 percent.
Ford has a gushing press release out on the US’ first month of Transit Connect sales; and a booming small business economic sector! You know things are a bit dicey when a survey saying “9 percent of small business owners plan to hire additional staff within the next three months” gets its own big bold bullet point. That nine percent planning to hire means that the other 91% plan to either hold pat or let employees go. Ouch, those are bad numbers.
Clearly, GM’s top suits missed the memo about the end of empire. While the artist formerly known as the world’s largest automaker clings to dreams of holding onto Opel with your (and German) tax money, the company has unveiled plan B: Chevy attacks! The Wall Street Journal [sub] reports that “Brent Dewar, recently named to head Chevy’s global operations, told reporters Friday that Chevy sales in Europe are expected to expand to one million from the 500,000 vehicles — or 2.5% of the market — sold in 2008. He didn’t provide a timetable for the growth target, but said new products — including Chevy Volt electric cars and Malibu sedans shipped from the U.S. — will fuel the effort.” Huh? “We’ve got to take this brand and truly make it global . . . a true relevant global participant,” Mr. Dewar said, admitting that the effort is “a work in progress.” Oh, so that’s what you call it . . .
No. Really. GM’s top execs [not shown] stood up in front of their Midwestern dealers at the Rock Financial Showplace and told them that new car sales will rebound by 15 percent next year, ascending to an annual tally of 12.5 million vehicles. That’s fantastic news. But the real shocker: our mole reports that the suits only said the word “faster” once. The company’s new mantra: our costs are less, so we can charge you less. No, wait; that’s a local Toyota’s dealer’s come-on. I mean, our costs are less, so we can keep our jobs longer. Or make a profit. Or something. Meanwhile, Automotive News [sub] reports that GM has formed a special task force to “try to retain 3 million ‘free agents’ — customers that have lost their favorite brand, nameplate or dealership this year.” Interesting use of the word “favorite” . . .
Post-clunker mortem, CNNMoney says 700,000 clunker-traders “probably got a good deal.” The rest, not so much. “If you bought a car without a clunker in the last month, you’ve overpaid.” Ya think? “During the weeks the Clunkers program was in effect, buyers of the Toyota Corolla paid 29% closer to the full sticker price than before the program started, according to data from Edmunds.com. Prices were also higher on other popular models. Ford Escape prices were 13% closer to full sticker, and Ford Focus prices were 12% closer . . . on a dollar-for-dollar basis, car buyers were getting less car for their money after negotiating the deal.” And now?
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