GM's come-up with a new use for OnStar: collecting data on test mules. The Detroit News reports that The General racked up 1m miles testing the Lambda CUVS and collected the test data via telemetrics. Since OnStar can't tell them when a body panel's buzzing or note that a radio knob just fell off, they also collect data from dealers. That's how they found out the Malibu's hazard light switch wouldn't pop out like it was supposed to; which resulted in an "engineering analysis" of the problem and an "engineering tool change." Perhaps they should do an engineering analysis of their PR department too. In the same article, the DetN also reports GM "has added a shift at its Lake Orion plant to build more" Malibus to meet demand. And this right after they attributed the shortage of Malibus to problems with their part supply chain. Looks like someone needs to get their story straight.

Yesterday, we took a "Whose Fault Is It Anyway?" look at consumers who used carmaker's easy credit to buy (in the ironic sense of that word) vehicles they couldn't afford. Today, the San Antonio Business Journal reports that The Alamo City guv'mint has teamed-up with Ford "to make it easier for more working individuals and families to buy a new or used car." Here's the deal: low income buyers save up $1000. FoMoCo and San Antonio's Department of Community Initiatives match the buyer's grand with two more, creating a $3k down-payment towards a new or used vehicle from one of eight participating Ford or Mercury (!) dealers. To qualify for the "down payment assistance program" the buyer's income must not exceed 300 percent of the federal poverty level (that's $61,950 for a family of four). Applicants must also be a San Antonio resident, an insurable driver, not have declared bankruptcy within the last seven years and be "current" with all creditors. (Driver's license?) Oh, and they have to qualify for financing. Welcome to America! 

The Lansing State Journal reveals the reason Buick Enclave and Chevrolet Malibu sales are stuck in second gear: parts. According to Gary Cowger, GM's group vice president of global manufacturing and labor, "a lack of components" underpins this December's decision to shut down a third shift at Lansing Delta Township factory. "Even if that had kept running, we still wouldn't have been able to make more Enclaves." What's more… "As you know, we put that third shift on for a while to try to ramp up. But at the tooling rates of the supplier base, you'd have to buy another set of vendor tools (to make more parts) and that takes time. We're maxed out from a tooling standpoint." Cowger also implied that the Chevrolet Malibu drought is down to the same parts problem. "What we're doing right now with the Enclave and CTS and (Chevrolet) Malibu is doing a very detailed analysis of the bottlenecks in the supplier community so you can invest in the right tool sets out there and increase the capacity of that product at the plant." Cowger admits GM underestimated demand for all three cars, but said it's "a good thing." Try telling that to the 1000 GM workers who got laid off, or the GM dealers desperate for product to sell. Oh and don't think we've forgotten that back in October, when GM announced they were shutting down the third shift, they told the LSJ they "eliminated the third shift to keep from overproducing the crossover vehicles made there." I wonder why they didn't bring up the parts issue then? [thanks to Sparky for the tip]

Buick's communication manager, Dave Darovitz, takes exception with TTAC's blog about the Enclave's sucky sales. We received the following message from Mr. D.:

Just so our buddy Frank has the correct information – that is your outlet claims to be about the "truth" – let me give you and Frankie a dose of it. The Enclave IS the hottest selling crossover in the industry. We've sold more Buick Enclaves in half a year of production than Mazda CX-9 sold in one full year. And, 90 percent of our Enclave sales are of the uplevel CXL model – the highest contented, richest model we offer. Nearly half of our Enclave customers are new to GM, and we've had a waiting list of paid customers since we started producing the crossover. Finally, customer and dealer demand for this standout Buick far exceeds what the plant can physically produce. So, if this "sucks", what's Frank's definition of success?

Well Davie, I'd like to know how you define "hottest selling." Even the Enclave's corporate-cousin Acadia far outsells it month after month, as do the Lexus RX and any number of other CUVs. The CX-9 hasn't been on the market for "one full year" — it went on sale in February. And with all the awards the CX-9 has gotten over the Enclave, they're getting a lot of free press which will drive sales up. Incidentally, you only sold about 4K more Enclaves than Mazda sold CX-9s. Can you sustain this, or will Enclave be like other GM models that tank once you satisfy the initial demand?

So what if the CXL model is the best-selling trim level? I don't know anyone who tracks sales by trim level. It's good you can pull some new buyers from outside GM, as Buick's traditional customer base is dying off with alarming regularity. How long do you think your "paid customers" will wait when they see other comparable vehicles readily available?

Finally, if demand is that high, why aren't you diverting production at this overtaxed plant (where they recently shut down the third shift) from the Outlook (which is busy gathering snow on dealer lots) to the Enclave and 1) bolster dealer morale and let them average more than five sales per month, 2) satisfy all these customers who are lined up money in hand, 3) help Saturn deal with their almost 100-day supply of Outlook and 4) drive up Buick's overall sales numbers and bottom line (which is never a bad thing)?

My definition of success? A car that sells well without artificially manipulating supply against demand and keeps on selling well even after the initial demand has been satisfied. So far Enclave has yet to satisfy either of these expectations.

Your serve.

GM claims the Buick Enclave is a success– even though they sold 26,286 units in '07. Compare that stat to the sales numbers for the big Buick's platform sibs, the GMC Acadia (72,765) and Saturn Outlook (34,748 ). While we're at it, in the same time frame, Lexus shifted some 73,246 RX models. GM attributes the Enclave's low sales to "limited availability." Yes, well, GM ended the year with a 98-day supply of Saturn Outlook. As they're built on the same assembly line, GM could easily divert that production to build better Buicks. The problem is no one seems to want them. Buick dealers averaged just five sales each in December, up one sale per dealer from November. That works out to three cars (Lucernes and LaCrosses) and two trucks (Enclaves, Raniers and leftover Rendezvous and Terrazas) per dealer. If Enclave was in as much demand as GM would like us to believe, they'd surely be pumping as many as they could out the factory door to bolster the dealers' numbers. Which leads to one of two conclusions: either the Enclave is a flop or they're intentionally starving Buick dealers out of existence. Or both.

Schmoozing with Automotive News [sub] at the North American International Auto Show, GM Marketing Maven Mark LeNeve has declared that the automaker is "willing to boost incentive spending in 2008" to move the metal. But then "We've broken that cycle of incentive spending." Of course, "you still have to be competitive." To which GM CEO Rick Wagoner quickly added "On the flip side, I don't see us needing to be leading that parade." So… GM's willing to boost incentive spending to keep from losing market share in '08, but they don't think they'll have to, unless they do, and if they do, they'll be reacting to other automakers' incentive spending rather than starting an "incentive war," which they will fight to win even if they didn't start it. Gotcha. Even less realistically, LaNeve promised to limit GM's daily rental fleet sales to 15 percent of GM's total. Unless…

As you'd expect, Texas is America's largest market for full-sized pickup trucks. While pickup truck sales fell 14 percent nationally over the past four years, Bloomberg reports that they rose 5.2 percent in the Lone Star State. GM, Ford and Dodge aren't exactly celebrating, though. In 2007, Toyota's piece of that pie grew 79 percent, while the so-called domestics' slice dropped by five percent. Even worse, Dallas Ford dealer Sam Pack says a lot of those Tundra sales are conquest sales, "coming from traditionally Ford, Chevrolet and Dodge" buyers. While the raw numbers still favor The Big 2.8, Tundra's share of the Texas market rose from 4.7 to 8.4 percent last year. To git 'er done, Toyota put $6.4k worth of incentives on the hood, putting the Texas-built Tundra in the middle of the pack (Ford $6.6k, Chrysler $6.47k and GM $6k). As the pickup truck market shrinks even more in 2008, you can bet Toyota will continue its slow but steady incursion into the domestics' last redoubt. And watch those profit margins shrink.

TTAC's Samir Syed has already discussed the revolutionary nature of Tata's new Nano. Just-auto [sub] reports that Automotive News Europe [sub] is reporting that Tata Motors is looking to spread the love. At the new car's launch, Tata Motors' group chairman Ratan Tata said his company will export their "people's car" into the Eurozone. Eventually. Tata will restrict Nano sales to India for the first two years– or more– before starting exports. To Africa, Latin America and southeast Asia. After that, they'll shoehorn in some bigger engines (the base Nano has a 33hp 624cc two-cylinder powerplant) and add some more "advanced features." Hang on. Can the new "people's car" meet strict European emissions and safety regulations? "When we go to Europe, we will conform to all existing regulations," insisted Girish Wagh, head of the 500-member Nano product development team. Responding to a question, he added" "Yes, I said when."

While you might think that a savvy American automaker would stay well away from the political fray, the Buloxi Sun Herald reports that GM is still catering to its republican "base." After hooking-up with conservative talk radio hosts Sean Hannity and Rush Limbaugh last year, GM has now secured itself the honor of being the Official Vehicle Provider for this year's G.O.P. convention in Minnesota. And yes, I'm aware that this is not new news. "GM and the Republican National Convention have enjoyed a strong partnership for the last seven conventions," revealed convention President and Chief Executive Officer Maria Cino. "We look forward to working with GM once again to keep our convention moving smoothly." But this time they'll also be moved cleanly; GM's G.O.P. fleet will consist "primarily: of flexible-fuel and hybrid models. "This is an outstanding venue for a great number and variety of people to see first-hand how GM is leading the way with more products with more fuel and technology choices for consumers," said Ken W. Cole, GM vice president for Global Public Policy and Government Relations. Somehow I doubt the public education will include a Cadillac Escalade Hybrid.

Japanese motor vehicle sales fell 7.6 percent in 2007; Toyota was down 6.2 percent. Still, Bloomberg reports that the Toyota Corolla managed to retain its five-year standing as Japan's best-selling passenger car (excluding minicars). Corolla sales increased by 2.7 percent last year, almost 150K units found new homes. The Toyota Schvitz… er… Vitz (a.k.a. Yaris) was Japan's second-best-selling car, clocking over 121k sales (up 3.2 percent). Toyota better be careful, though– Honda's having a Fit to unseat them. The redesigned Fit went on sale in October and became Japan's best-seller in December (again, excluding minicars). The fit outran the Corolla by a margin of almost two to one. That's a 144.1 percent increase over December 2006. The Fit's annual sales rose by 14.5 percent, scooping third in overall sales. If you don't exclude minicars, Suzuki reigned supreme in 2007. The brand sold over 225k Wagon R kei cars. Now if they'd just pop a Hayabusa engine into a few of them and send them our way…

Despite the potential (if not actual) cratering of the U.S. new car market, Toyota reckons it will rack-up seven percent more sales abroad in '08 than '07. CNNMoney reports that Toyota '07 sales rose six percent to 9.37m vehicles. Sniffing big business in the expanding Russian and Chinese markets, Toyota reiterated its previous forecast for a big boost in total global sales in 2008, heading for 9.85m new car sales. Although Toyota's doemstic (i.e. Japanese) sales fell four percent in '07, down to 2.228m vehicles, their soothsayers say the market has stabilized, and will remain flat for '08. Whether all this will be enough to (once again?) wrest the "world's largest automaker" crown from GM remains to be seen; GM is also doing land office business in China, South America and Russia. But if we're talking profitability, well, Detroiters may not want to go there… 

It's a Hell of a good question. Strangely, few Western media outlets have tackled it. While TTAC's take is forthcoming, The Liverpool Daily Post's Alastair Houghton casts his beady eye on Tata's prospects with the damaged British brand. It may be painful for Jag fans to reconsider the fate of the ill-fated X-Type and re-scan the arterial spray or red ink dogging the cat, but they'll be heartened to read Houghton's historical analysis of the Indian conglomerate's success with other British concerns. The story surrounding Tata's entry into the steel market is especially resonant. “Do you mean to say Tata proposes to make steel rails to British specifications?" Frederick Upcott, Chief Commissioner for Indian Railways reportedly remarked at the turn of the last century. "Why, I’ll eat every pound of steel rail they succeed in making.” Last year, Tata ate Corus, the company that had eaten British Steel. Equally reassuring (to "traditionalists"), the chief executive of the UK India Business Council doesn't see any branding issues. “If you look at Tetley [tea], you don’t see the Tata brand on it at all," Sharon Bamford says. “They put the interests of the brand and the community they serve at the forefront. The process we’ve seen appears to be a typical Tata deal.”

The U.S. isn't the only market where car sales have stumbled, tripped and hit their head on the coffee table. Japan Times reports that new vehicle sales in The Land of the Rising Sun sank to a 35-year low in 2007. The Japan Auto Dealer's Association recorded slightly fewer than 3.5m new vehicle sales.  Automobiles with engines larger than 660cc were down 7.6 percent from 2006, while sales of minicars (engines smaller than 660cc) fell 5.1 percent. Toyota took a huge hit on their home turf, dropping 6.2 percent for the year. Honda, Nissan and Mazda managed to lose less. Analysts blame rising fuel prices, a shrinking population and a decline in wages. Just like GM and Ford (and to a lesser extent, Chrysler), foreign sales are buoying the car companies' bottom lines. Even they're doing relatively well, the current U.S. sales slowdown will take their toll on the Japanese corporate motherships. 

While Toyota Motors North America (TMNA) finished 2007 in overall better shape than its domestic competition, they failed to meet their goal of selling 200k of their new, full-sized, Texas-built Tundra pickups. Hope leaf springs eternal. Even as the market for large pickups follows the U.S. housing market into the crapper and fuel economy standards get tighter, ToMoCo's sticking with their goal of 300k annual sales by 2010. Toyota Division GM Bob Carter told Automotive News [sub], Downturn? What downturn? [paraphrasing] In fact, Carter predicts Tundra sales will hit the low 200ks in 2008. "There is no cause for alarm. We are on plan." When asked how long it'll take for Tundra to top the 300k mark, he clammed up. However he did mention they "have 44 Tundra models now, and in the future, that segment requires even a broader lineup than we have today." So let's see… they have a model that is selling below expectations in a market segment that is shrinking so their solution is to increase the complexity of the model line-up to generate sales. The Big 2.8 have been hiring TMNA executives right and left. With marketing logic like that, you have to wonder if Toyota's been reciprocating.

GM's main man told Bloomberg that he expects 75 percent of The General's car and truck sales to come from outside the U.S. within a decade. Meanwhile, while GM's setting sales records in developing markets overseas, they're losing money at home. Lots of money. To his credit, Rabid Rick did touch on that small issue with Bloomberg. GM's CEO claimed his "plan" to end those losses is about "50 to 60 percent complete." WHAT PLAN? Has anyone seen this plan or is he, like Indiana Jones, making it up as he goes along? Which ever it is, Wagoner [finally] admits things aren't quite going as expected. "Maybe the actions are a little farther along, but the results I don't think are that far along." With Wagoner conceding defeat in North America, the results probably won't get much farther along, either. What's that sound? Why, it's Toyota, Honda and Nissan letting out a war whoop as they thunder down their American happy hunting ground.