Mercedes, BMW and Volkswagen/Audi are all moving inexorably towards a major downmarket expansion, as they develop a new generation of compact and subcompact cars based on front-wheel-drive architectures. Though Volkswagen has played in this space for some time, the move is a major cultural shift for BMW and Mercedes, which are typically associated with rear-drive luxury cars, particularly in the US market. But the truth is that the German luxury brands have always sold products in the German and other European markets that don’t match their premium overseas brand images (see, among other examples, the ubiquity of Mercedes taxis in Germany). But the strange thing about this next push towards smaller cheaper cars is that it’s not not aimed at Germany at all.

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Before the remnants of the British Leyland empire were sold off to various developing-world automakers (in an intriguing automotive inversion of colonialism), BMW temporarily became the caretaker of a number of British auto brands, including Rover, MG, Land Rover, and Mini. Only Mini now remains under Bavarian fealty, but before dumping the mess on the hapless Phoenix Consortium, BMW helped the Rover brand develop its only halfway-competitive car of the 1990s: the retro-inspired Rover 75. And according to Britain’s AutoExpress, BMW also helped Rover developed this odd duck, known as the 55, as an attack upmarket on Audi’s A4 and Mercedes’ C-Class. It was to be followed by a larger replacement for the 75, which would have given Rover a one-two punch to match the Mercedes C and E Classes, Audi’s A4 and A6 and so on.

The long-nosed look of this 1997 design study is the result of a Passat/A4-style longitudinal-front-drive platform, which (like the 75’s platform) had been experimentally developed by BMW. Of course, the looks are a bit odd, and BMW really didn’t need to develop unique-platform competitors for its 3- and 5-Series, so this car was probably never likely to make it to production. Still, it’s interesting to imagine what Rover would be like today if it were still struggling along with a large neo-retro flagship based on dated German technology and not much else… except that then it would pretty much be a British Chrysler.

In Europe, governments are ramping up their electric car programmes in order to usher in a new era of alternative propulsion vehicles. Some more successfully than others. And just as the countries are doing their part, the automakers are doing theirs. GM has an Ampera (or “Volt”, as our North American friends will know it as) in the offing while Nissan preps the Leaf. Much has been made of this fight, in part because it is playing out globally. But in Europe another contender is looking to steal the march on GM and Nissan: Indian upstart Tata Motors.

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Autocar reports that Renault workers in France are jumping on a bus and heading to the Paris Motor Show. Are the doing it because they fancy a day out? Maybe they want to see all the nice cars on display? Nope, they’re going there to protest. OK, so who do you think they are going to protest? Hyundai? Toyota? Ford? Nope. They’re protesting against Renault. So, a bunch of French Renault workers are going to the Paris Motor Show to protest against their own company? Why?

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Reuters [via ABC] reports that GM has completed its S1 filing and will file Monday, after a Friday the 13th filing was delayed in order to

add a management risk factor after Chief Executive Ed Whitacre announced on Thursday he would step down and be succeeded by Dan Akerson effective September.

And that won’t be the only “risk factor” warning to investors in GM’s S-1. Bloomberg found a number of analysts ready to support the headline

GM’s Akerson to Struggle in Proving to IPO Investors Europe Fixable

Any bets on the number of times the word “Opel” appears in tomorrow’s filing?

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In the last installment of our New Or Used? series, Sajeev, Steve and our Best and Brightest teamed up to help a reader find the modern equivalent of a Volkswagen Microbus. Because answers were limited to US-market vehicles, this CrossTouran wouldn’t have made the cut, but in a perfect world, this might just have been the car our reader was looking for. But with a starting price of €27,700 ($35k) for a 105 HP version, it’s still missing the kind of US-market appeal that might tempt VW planners to send it stateside… especially with the more American-friendly Tiguan starting at $23k, and the more off-road-capable Touareg going for about $40k. But if a small, AWD van is what you’re looking for, there is an automaker willing to take a risk on your peculiar tastes: the next-gen Mazda5 may not be a looker, but it’s said to come with an AWD option when it debuts in the US early next year.

The Honda Civic Type R has become the latest casualty of the new Euro V emissions standard, reports Autocar, and it will be discontinued for the European market at the end of this year. Weirdly though, production of the British-built Civic Type R will continue, and the two-liter “touring car with number plates” will be exported to the South African and Australian markets. To which we say, the Type R is a low-volume model anyway… why not send a few to the US? Sure, if you directly convert the UK price to dollars, a top-spec Mugen Type R costs a whisker under $40k… and we’d guess more Americans would spring for a Volt at that price. And yes, it would certainly suck some enthusiasm out of the all-important CR-Z launch. Still, Honda needs to stop making sense and do something that proves it hasn’t forgotten its roots in the US market. Sending a few hundred Type Rs to the US is worth a thought… or is the whole idea as silly as testing a Type R against an Audi R8?

There seems to be an appetite debate about this issue, not just here at TTAC but in the industry as a whole. Just look the philosophical divide between the “One Ford” strategy and Volkswagen’s 2011 Jetta strategy. So instead of filling up the Jetta review comments with this debate, let’s have it out… right here, right now.

What’s the difference between these two compact crossovers? American readers will recognize the vehicle on the left as the forthcoming facelift of the Nissan Rogue. The crossover on the right is a recently-released update to the European-market Nissan Qashqai. The Rogue is slightly larger in most dimensions than the Qashqai (not counting the extended-wheelbase Qashqai +2), and only offers a 2.5 liter engine while the Qash has a palette of four two-liter and smaller gas and diesel engines. But it’s not the Euro model’s cramped quarters or low-displacement engines that we find ourselves wishing could find their way to the American market… it’s the Qashqai’s updated styling that we want. Sure, these things are subjective, but the updated Rogue just doesn’t seem like much of an improvement on its predecessor’s looks. The Qashqai, meanwhile, has gone from filler to killer.

Recently, Opel’s boss Nick Reilly was asked by the Süddeutschen Zeitung how long it could be before GM’s top management decides that it doesn’t want to rescue its European division Opel after all. His answer [via Autobild]:

It’s not a question of two years, but rather six or nine months, before we need to have proven that we’ve made positive progress

Even then, Reilly admits that

We need four to five years before we’re able to get back to where we were

That doesn’t sound so good, does it?

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The ACEA has released their European new car statistics for the month of June. One look at the picture tells you what is happening: With the cash for clunkers effects slowly working their way out of the system, Europe is settling into a new normal. In June, the market was down 6.9 percent, but for the first six months, with 7,285,487 new cars registered, the market in the EU27 is pretty much what it was in the same period last year. Compared with the first six months of 2008, the market decreased by 10.3 percent, but those were the good old pre-carmageddon days. (Read More…)

Smart’s current plan for reviving its fading sales is a Tesla-powered EV version of its Smart ForTwo, which the Daimler-owned firm hopes will keep its city cars moving until a new platform is jointly developed with Renault. Further down the road though, it seems that Smart is moving to expand out of cars, as Autocar reports that the brand is developing a plug-in electric scooter. A senior Mercedes-Benz source tells the British magazine that

Smart was originally established to tackle the need for improved mobility, especially in congested city environments. Up to now we have concentrated our efforts on four-wheel solutions. The next stage is to looking at how to expand beyond this with other environmentally friendly vehicles

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Ford has once again snagged aid from a European government, as The Wall Street Journal [sub] reports that the British government has approved a £360m ($543m) guarantee on a £450 ($676.4m) European Investment Bank loan to The Blue Oval. The money will be used to fund a £1.5b ($2.25b) investment in four British Ford manufacturing sites. In an official statement, British Business Minister Mark Prisk said

[Ford’s] investment of GBP1.5 billion over the next five years is a great opportunity to take the lead in developing low-carbon manufacturing. This backing from the government will help to ensure the long-term success of manufacturing in the U.K. and make sure we are at the forefront of new technologies

The money will be used to safeguard 2,800 British jobs, and help Ford develop a new generation of low-carbon engines as well as for development of commercial vehicles. This despite the fact that Ford of Europe had previously laid into GM’s persistent requests for European aid in restructuring its Opel division.

Audi is apparently cashing in on the universal paranoia of having your car at the dealer as well as the distinctly British love of video surveillance, by offering AudiDirect Reception, which allows owners to watch their car go through maintenance. According to a press release [via WCF], the new program makes Audi technicians wear video cameras and two-way communication systems, allowing owners to constantly watch over their shoulders and interrupt their work. Or, as Audi puts it

Candid cameras will soon be focused on all Audi Centre service areas as part of a new Direct Reception initiative being rolled out across the network that will enable Audi customers to view in ‘real time’, and communicate with, technicians as they carry out diagnosis and repair work.

Up next? Chat Roulette!

Italian supercar upstarts Pagani started with one car, the Zonda, and have maintained a laser-like focus on that single nameplate ever since. Former supercar heavyweight McLaren is re-entering the road car arena with its V8-powered Ferrari Italia-fighter, the MP4-12C, but is fast-tracking the development of its range-topping supercar, pitched as a neo-McLaren F1 and aimed at the Zonda and its hypercar ilk. Recession? What Recession?

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