More than three hours and two hundred miles after leaving home, a call came through on our Fusion’s SYNC system: the testing session we’d scheduled at Virginia International Raceway was canceled due to several inches of unexpected snowfall. With ambient temperatures hovering in the fifteen-degree range, and without any available track time to put Ford’s facelifted mid-sizer through its paces, how could we determine if the Fusion “Sport” lived up to the promise of it’s fashionable chrome badging?

Now that the Presidential Task Force on Automobiles (PTFOA) has pre-capitulated on re-upping Chrysler and GM’s bailout bucks, an obvious concern arises: now what? Chrysler offers a tri-branded line of non-competitive products whose sales have been propped-up by federally-funded discounts plus plus plus. GM is still in over-branded, over-dealered, over capacity hell. So, if both companies score big bailout bucks ($22B), what will they spend it on? Building cars? Inventories are already swelled and, here’s the kicker, sales are still declining. As we approach the end of the month, Automotive News [sub] is using the “T” word: “The sales numbers for March, due next week, are likely to reveal another tumultuous month. New-car sales could be down as much as 40 percent, according to J.D. Power and Associates. And the monthly sales rate will continue to flirt with lows not seen in 27 years.” Interesting choice of words; who’s about to get NSFWed here?

Read More >

Honda planned its new Insight hybrid to cost less than Toyota’s ubiquitous Prius in hopes of snagging economy-minded hybrid shoppers. Unfortunately for Honda, the Insight wasn’t quite the bargain they’d hoped for. Despite rumors of an $18,500 base MSRP during planning, the Insight ended up just a few grand away from the Prius at $20,470 base (including delivery charge). And now Toyota is returning the favor, telling Automotive News [sub] that it’s planning a Yaris-based “economy hybrid” to undercut the Insight. “We are going to compete by expanding our hybrid-vehicle lineup to smaller hybrids, in the class of the Vitz and Yaris,” says Prisu chief designer Akihiko Otsuka, using both the Japanese domestic and overseas market names for Toyota’s supermini. The implication is that this baby hybrid will hit all of Toyota’s major markets possibly beginning as early as 2011. But Honda isn’t taking the news sitting down reminding AN that a Fit Hybrid is also being planned which could bring Honda’s hybrid entry cost down even further. All of which is good news for hybrids, which seem ready to finally leave behind their eco-accessory reputation and get stuck into some good, old-fashioned value competition.

“It’s a Jeep thing, you wouldn’t understand”. This was the vaguely condescending response I got when I queried my then-girlfriend and current wife about why in the world she would choose such an unrefined and slow mode of transportation. Surely, you can understand my point of view. I mean, the Jeep Wrangler is the ultimate, absolute antithesis of everything performance-related in the automotive world. Well, that is true so long as we are talking about road-going performance. Some, like my wife, get more excited about the prospect of slogging through mud and muck than teeter-tottering on the bare naked edge of control around a downhill decreasing-radius corner. And, for those who get their jollies in the dirt, the Wrangler Rubicon is the ultimate starting point for a true performance vehicle.

In 1979, Chrysler was staring down the barrel of bankruptcy. ChryCo’s charismatic CEO stepped forward, publicly lobbying for $1.5B worth of federal loan guarantees. Lee Iacocca captured the American taxpayer’s respect and trust—to the point where the automaker’s ad folk made Lee the company’s pitchman. “If you can find a better car, buy it!” he dared. They did and they didn’t. Either way, Iacocca’s communication skills were beyond reproach. Contrast that with today’s mumbling, bumbling Motown CEOs, who’ve managed to alienate well over half of the American public, who no longer want to buy Detroit’s cars OR provide them with a second (third) chance. And no wonder. The CEOs have demonstrated an abject inability to call a spade a spade, or sell the spadework that must be done (which is largely grave digging by now). Wagoner, Nardelli and Mulally’s failure is what it is. But what about the little guy in all this? Who speaks for them?

I’m not talking about Detroit’s unionized workers or their white collar counterparts. As much as I sympathize with their plight—caught-up as they are in a poisonous corporate culture not of their own making—they are hardly a downtrodden, voiceless minority. Their Motown overlords have Washington’s ear. The fact that Chrysler and GM have scored over $50 bn in federal handouts of one sort or another (loans, retooling loans, finance company bailouts, etc.), while Ford has arranged a $9 bn line of credit, speaks for itself. Detroit’s dealers, captive finance companies and suppliers are also well represented. But what of everybody else in the American automotive industry?

I refer to the foreign nameplate automakers and their workers. Other than some gentle murmurs of encouragement, we’ve heard nothing from Toyota, Honda, Nissan, Hyundai and the rest of America’s so-called transplants re: Chrysler and GM’s federal trough snuffling. The transplants should be a force to be reckoned with; they currently account for more than half of all automotive sales within our borders. They aren’t technically bankrupt, or facing bankruptcy. Yet their tax money (like ours) must now pay for Detroit’s chronic mismanagement.

The transplants’ productivity and success, their ability to create goods and services that American consumers want at a price that makes the company a profit (in accordance with all U.S. laws and regulations), is now subsidizing Detroit’s ongoing incompetence.

Of course, it’s worse than that. This is not a general taxpayer bitch and moan thing. It’s a government using tax money to distort the will of the American consumer by propping-up a dead competitor trading thing. In a severely contracting market, no less. I know: jobs! jobs! jobs! But what about the jobs! jobs! jobs! of all the productive, hard-working non-Detroit autoworkers laboring within U.S. borders?

The current economic meltdown has forced Toyondaissan to curtail American production, cancel scheduled factory openings and lay off thousands of workers. Would those curtailments have been as severe if Chrysler and GM had been “allowed” to go belly-up? Of course not. Common sense tells us the transplants would have scooped-up a [yet] larger share of the suddenly smaller pie, supporting American jobs and American communities. There’s no getting around it: the federal bailout is taking food of the tables of American workers.

There’s plenty of room to debate the advisability of encouraging foreign nameplates to manufacture cars in the U.S., relative to, say, Detroit-based automakers. (Who’ve shown no reluctance about importing vehicles into the U.S. market.) We’ve engaged in that discussion here on TTAC many times. But where is the voice of the transplants and their workers in this debate?

Again, there are thousands of workers and dozens of communities spread throughout the U.S. who build cars for Toyota, Honda, Nissan and Hyundai. Workers who manufacture a quality product for American consumers. Workers who pay their taxes. Workers who are NOT sucking off the federal teat, either directly or indirectly. Who speaks for them? Are they not outraged by their own government’s willingness to put their jobs at risk to support a business model that’s broken beyond repair?

If they’re not, they should be. Last year, they went to bed and woke-up in a world where free and fair competition, combined with the sweat of their own brow, assured their family’s future. Now, who knows? A cabal of corrupt financiers blew a hole through U.S. banking regulations designed to protect the average wage earner from economic ruin. These insiders opened the door; the feds have come traipsing in, paving Detroit’s road to hell, forcing American autoworkers to compete against their own government.

It’s time for them to tell Washington that these enormous, unrecoverable “loans” to Chrysler and GM are a cancer on their beliefs. I understand the transplants’ desire to keep a low profile and wait for the dust to settle. But America’s traditional values are at stake. Their workers must step up and say no to Bailout Nation.

It seems straightforward enough: federal vouchers for old clunkers. Takes old heaps off the road. Stimulates new car sales. Done. Of course, we are talking about a government program here. And that means that H.R. 1550, the “Consumer Assistance to Recycle and Save Act of 2009,” has quickly become a cat fight amongst interested parties (manufacturers, dealers, dismantlers, after-market parts makers, trade protectionists, etc.). If passed, 1550 will surely evoke the law of unintended consequences. At the moment, the bill’s been referred to the House Transportation and Infrastructure committee, so that august body can breathe their magic upon it. Ahead of that joyful event, 1550 contains some HIGHLY contentious sections. How about a stricture for the new car purchase that stipulates different minimum levels of highway fuel economy depending on whether the vehicle was manufactured in the United States or “North America” (i.e., Canada or Mexico)? Yes, way.

The money shot: Section 3 mandates a $4K voucher for “passenger automobile assembled in the United States with a minimum highway label fuel economy of 27 miles per gallon.” The same four grand goes to “passenger automobile assembled in North America with a minimum highway label fuel economy of 30 miles per gallon.” I guess our neighbors to the north and south must. Try. Harder.

If the new “passenger automobile assembled in the United States” achieves that same [higher] 30 miles per gallon highway mpg standard, the US vehicle gets an extra grand: a $5K voucher. Oh, and if that “passenger automobile assembled in the United States” happens to be an electric or plug-in electric vehicle, the voucheree scores $7500. At the moment, the money would go to someone looking at a $100K+ Tesla Roadster or one of those NEV golf cart thingies.

AND if the new “passenger automobile assembled in the United States” only achieves 24 mpg highway, don’t worry too much. The feds would like to present you with a $3K voucher.

The bill also stipulates a lower minimum for trucks, ’cause we don’t want to leave out trucks, a domestic mainstay, do we? “Non-passenger” vehicles must achieve “only” 24 miles per gallon highway to qualify for that $5K voucher. [Look for some tall ass gearing if this passes.]

As for the imports—Saturn Astra, Toyota Prius, Honda Fit, etc.—their buyers are  SOL, voucher-wise. Which, of course, threatens to evoke a trade war. Which could well be the last thing the US economy needs right now [see: Great Depression].

As for the cost to dealers and dismantler of making all these sales, which should generate some kind of profit, 1550 throws in $50 per transaction. Hey, why not? It’s not as if the dismantling industry has a history of title washing or any sort of thing. And while we’re on the subject, who’s in charge of making sure all the clunkers are crushed, the toxic waste removed and the registrations destroyed? Uh . . .

At the moment, the Automotive Aftermarket Industry Association (AAIA) is 1550’s most vociferous opponent. Well they would be, wouldn’t they? Aaron Lowe, the org.’s vice president of government affairs for the AAIA, sent out a press release countering any suggestion that their opposition has anything to do with their members’ profits.

“Proponents of the Cash for Clunkers bill say that it will benefit the environment because it will take older cars off the road, replacing them with new, more fuel efficient vehicles… What will become of all these old cars? The answer you don’t hear from the backers of Cash for Clunkers is that these scrapped vehicles will more than likely be sent to landfills, creating more pollution, not less.”

The AAIA has created a website—fightcashforclunkers.com—to carry their banner forth. While there’s a debate to be had about the relative pollution of old vs. new, let’s file this one under Where’s MY NSFW Bailout?

The Cash for Clunkers program would earmark federal funds for car owners to trade-in their sport utility vehicles in exchange for vouchers to be used to obtain newer, more fuel efficient vehicles. On the surface the program may sound reasonable, but its consequences will increase the nation’s carbon footprint, create issues for those not fortunate enough to afford the cost of a new vehicle and be a waste of taxpayer dollars.

The Fight Cash for Clunkers organization… instead favoring tax credits to help upgrade, repair or maintain older vehicles, as well as tax deductions for interest on car loans and state sales tax.

Death would be too good for this bill. And the idea that the feds should do something, ANYTHING, to stimulate the US new car market is sadly, badly mistaken. The best thing our government could do for the UScar industry is to let Chrysler and GM go C11 and/or C7.  The resulting flood of new, highly discounted product will drive down prices and, perhaps, encourage buyers to trade-in their old cars for new.

You know that advertisement for the Cadillac Escalade Hybrid where a douchey fellow suggests that “they should hybrid (sic) this thing”? I would post the video, but it seems that Cadillac has pulled all trace of the spot from the interwebs leaving only the marginally less insipid “cupholders” and “checkmate” ads on its website. And though it’s strange to plumb the Tubes of You for hours and not find this mythically inane third ad, it’s disappearance down the memory hole isn’t surprising at all. The spot suggested a troglodyte’s approach to hybrid technology that is only underscored by the reality of GM’s hybrid strategy: quick-n-dirty BAS, expensive and complex two-mode system, and moon-shot EREV. Hybrid this. Okay, now hybrid that. [ED: Zammy found it!] But Nissan’s announcement today that it will be bringing a hybrid version of its Infiniti M to the US market in 2010 has to put the Japanese firm in contention for worst hybrid strategy around.

Read More >

Here’s un peu de inside dope from France’s L’Automobile mag. Bottom line: the on-again off-again on-again off-again Toyota – Subaru rear wheel-drive car is . . . on again. And it’ll be called a Celica. Or not.

Chez Toyota, les bons et loyaux services ne sont pas toujours récompensés : après sept générations et six titres de champion du monde des rallyes, le coupé Celica a été remercié, en 2006, faute de ventes suffisantes (ci-contre, la septième et dernière génération). Mais le géant japonais s’apprête à lui donner une seconde chance. En 2010, Toyota lancera à nouveau un coupé sportif abordable, étudié par Subaru. Une information confirmée par Thierry Dombreval, vice-président des ventes et du marketing de Toyota France, dans le numéro 755 de L’Automobile Magazine.

Read More >

Loads of flames this weekend. The police stop video had members of the Best and Brightest morphing into the Mean and Nastiest. Please remember that TTAC’s posting policy is clear: no flaming the website, its authors or fellow commenters. Feel free to rip apart an opinion, but do not diss the site, the scribes or the folks. We also don’t allow meta-discussions about our editorial stance or style underneath an unrelated post. For example, I exorcised this broadside from thoots’ comment re: my Toyota Venza review:

As some have said, this is no ‘review,’ this is an ‘editorial.’ And it’s the kind of thing that makes me go elsewhere, rather than *cough* actually consider paying for somebody’s personal diatribe against car-like crossover styling or whatever it is that he or she happens to hate. Geez, just say that you prefer school-bus-style visibility, and get on with your life, could you? Crimony.

After a few emails with thoots—the proper place for site criticism—I’ve agreed to open the subject up for debate and turn off the anti-flaming directive. So, what’s wrong with TTAC’s reviews? What should we do to improve them?

The Minnesota state trooper who rammed a slow-moving minivan on New Year’s Eve was given a slap on the wrist Wednesday. A written reprimand was placed in the personnel folder of Sergeant Carrie Rindal, mildly criticizing her for twice slamming her patrol car into the Toyota Sienna minivan belonging to Sam Salter, 40, who had been driving his two-, three- and six-year-old children home to Hudson, Wisconsin, just before midnight on Interstate 94 in St. Paul.

Read More >

I’ve been resisting calling Toyota “the new GM” for some time. And yet the world’s largest automaker is falling into the same traps that scuppered GM’s empire. By creating the entirely extraneous Scion “youth brand,” Toyota stole a page right out of The General’s poisoned playbook. Luxury brand reaching downwards, hoisting itself by its own petard? Lexus does as Cadillac did. Listen closely and you can hear ominous rumblings about Toyota’s declining build quality; a cancer that afflicted GM even as it soared to its zenith. And most damning of all: Toyota’s increasing portfolio of redundant, ill-conceived, poorly-executed products. Add the new Venza to that list.

Is is that time again? The time when the MSM drinks copious amounts of Kool-Aid labeled J.D. Power Vehicle Dependability survey (VDS)? Assuming that there are TTAC readers who’ve joined us in the interim, let’s consider a couple of salient facts (as taught to us by Michael Karesh at the no-longer-TTAC-affiliated TrueDelta). First, the differences between brands in J.D.’s VDS is insignificant. Buick has 122 problems per 100 vehicles while Lexus has (shock!) 126 problems per vehicle. In the real world, this doesn’t mean you’re less or more likely to experience a problem in YOUR Buick or YOUR Lexus.

Read More >

After Germany’s cash-for-clunkers sales surge, it was only a matter of time, and not much of it, before the US followed suit. The idea failed to make into the federal stimulus package (which is like calling an all-you-can-eat buffet a Weight Watchers’ Special). And so, a bill is born. CNNMoney says aloha, clunker-mania.

The bill, introduced Tuesday by Rep. Betty Sutton, D-Ohio, would provide on- the-spot vouchers between $3,000 to $7,500 to consumers who trade in older vehicles for new, more fuel-efficient cars and trucks. The size of the vouchers would vary, depending on the fuel economy of the car being purchased.

The older vehicles, required to have been built at least eight years ago, would be scrapped and their parts recycled, while the new vehicles would have to meet a certain fuel economy standard – 27 mpg on highways for cars, 24 mpg for light trucks, Sutton said. Consumers could also opt to receive a $3,000 voucher toward mass-transit fares.

Sounds great! How could that possibly go wrong? You know . . . other than all the unintended consequences?

Read More >

The fellas at Autoexpress are saying it’s the “new MR2,” although there’s no indication yet that the planned hybrid coupe will rock the nameplate’s trademark mid-engine architecture. Toyota’s CR-Z fighter will be RWD though, making it the second rumored RWD Toyota coupe in the last year. The first, a joint Toyota-Subaru may or may not be on hold. “We have set a tough price point (expected to be around £20,000 ($28K)), as it will be easier to sell if it is affordable,” says Toyota VP Masatami Takimoto. “It has to be fun to drive, too, which means the hybrid set-up must be different to the Prius’s, with greater responsiveness.” If the hybrid coupe is “done right,” reckons Autoexpress, it will do 0-60 mph in seven seconds, while getting over 50 mpg. Looks like Honda isn’t the only firm trying to mate green with fun these days.

On Thursday, Audi of America president, Johan de Nysschen, will meet with journalists to explore the question “how has the international recession impacted Audi and the luxury segment?” The obvious answer: sinking sales. The not-so-obvious conundrum: what next? How does a luxury brand position itself for survival when class war is breaking out all over? Of course, the professional pundocrats aren’t using “C” word just yet. The euphemism du jour for the “where’s MY bailout” anger that may or may not be sweeping the nation—as taxpayer-owned AIG execs collect their bonuses and Bernie Madoff’s wife shelters in a penthouse funded by her husband’s ill-gotten gains—is “vengeful populism.” Whatever you call it, Audi and its luxury competitors are sitting in the cross-hairs of growing anti-conspicuous consumption. The recession/depression is going to kick the NSFW out of them.

Audi, BMW, Cadillac, Lexus and Mercedes have all poorly positioned themselves for these belt-tightening times. All five brands spent the last decade or more stretching their model range down into near-luxury and even non-luxury pricing territory. Not so long ago, none of these brands were available to average buyers (save on used car lots, where maintenance costs kept them clean of ten-foot pole marks). All five luxury brands couldn’t resist picking the low-hanging fruit, convincing themselves that they could democratize an exclusive brand.

Of course it worked. What aspirational car buyer wouldn’t prefer an up-market marque to a Ford, Hyundai, Toyota, Nissan, etc.? Thanks to a combination of affordable models and cheap credit, the “Big Five” have all experienced sales growth that makes Jack’s beanstalk seem like a redwood. BMW’s inexpensive leasing deals, in particular, created ultimate profits. But the move down market has created a vast flock of prodigal, homeward-seeking chickens.

For one thing, profits at Audi, BMW, Cadillac, Lexus and Mercedes are now dependent on relatively high sales volumes. In 2007, Mercedes-Benz NA sold 253,433 vehicles. Audi’s US sales jumped 11 percent, to 93,506 vehicles. Cadillac’s sales rose 13 percent. BMW’s ascended by 14 percent. Lexus took a hit that year, but they still managed to shift 342,000 units in North America. Compared to the mainstream manufacturers it’s small beer; but it still requires many pubs to serve it. All five luxury brands expanded their dealer networks. Which are now, or soon will be, struggling for survival. Last month, Lexus sales took a 35.8 percent year-on-year dip. Audi lost 25.4 percent of its previous year’s monthly totals. And so on, right on down the line.

Brand equity has also taken a huge hit. Although you might think the luxury car brands’ democratization makes them less vulnerable to a class-related backlash, nope. Let’s face it: it’s not a great time to be seen “splurging” on a luxury car. The car brands’ upmarket cachet has suddenly turned into a liability. Real world employees worried about their paychecks—and that’s all of them—are not going to stunt and floss in the company parking lot behind the wheel of a brand new Audi, BMW, Cadillac, Lexus or Mercedes. They know that rolling phat in a luxury-branded whip would be tantamount to wearing a little button emblazoned “overpaid.” Fuhgeddaboutit.

Even worse, the customers with real money, where profits fall like rain, have already left the building. They’ve opted for more genuinely exclusive marques. Audi and Mercedes recognized this problem before the axe fell; buying (Lamborghini), creating (AMG, S-Line) or resurrecting (Maybach, Bugatti) über-luxury off-shoots. But even if Audi and Mercedes managed to skim the cream off their own coffee, they face the same danger as their less brand-savvy luxury competitors: stagnation. Now that upmarket brands offer a wide range of models, cash-strapped or cash-aversive buyers can either stand pat (i.e., not trade-up) or, worse, opt for less expensive alternatives within the brand family.

So why would Mercedes create the GLK, when it already offers a full-size SUV AND a smaller alternative? Why would Mercedes market the GLK as a vehicle containing the same technological excellence as its bigger brothers, only in a smaller (read: cheaper) package? The Bama-built German “cute ute” represents a failure to communicate luxury brand values—and price points—within Mercedes’ corporate culture. It’s the same hubris that led to the Audi A3, BMW 1-Series, Cadillac CTS (sorry guys), Lexus IS250 and Mercedes C-Class. Short term greed over careful, long-term brand husbandry.

I know TTAC’s Best and Brightest have hashed this out many times. Many of you don’t see a price point as a brand barrier. But it’s petard hoisting time folks, and you’re about to see the brands reap what I said they’d sowed. In this suddenly, violently downsized, flash-aversive sales environment, brand-extended luxury automotive marques must either redefine “luxury” (as reliability, longevity, etc.), move back up-market (a slow, painful process) or die. And the longer the downturn lasts, the greater the chances that one or more of these brands will never recover.