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Archive for July, 2009

Audi Profits Slip, but Share Grows

Automaker putting off indefinitely a U.S. assembly line.

by on Jul.31, 2009

Audi is counting on its expanding line-up, including products like the upcoming A5 Sportback, to help it gain global market share and keep its balance sheet in the black.

Audi is counting on its expanding line-up, including the upcoming A5 Sportback, to help it gain global share and keep its balance sheet in the black.

The global slump may have taken a toll on Audi’s sales and profits, but the automaker insists the downturn could play to its advantage, longer-term.

The German maker, a semi-autonomous arm of giant Volkswagen AG, reported that it was able to stay in the black, during the first half of 2009, unlike many of its competitors, though profits still slipped by 25%. Sales slipped 9.7% from January through June, noted Chief Financial Officer Axel Strotbek, but that was also a fair bit better than the overall, 18% industry downturn, he stressed, during a conference call with American journalists.

“We want to use this opportunity to emerge from the current crisis considerably stronger,” the executive said, “a winner in the long-term.”

At the current exchange rate, Audi AG posted a net first-half profit of $979.5 million, or €697 million. During the same six-month period last year, Audi’s net was €903 million.

Meanwhile, unit sales fell from 516,219 to 466,000, a nearly 10% dip. The decline varied sharply from country to country, Strotbek noted. In fact, volume increased in China by 10.5%, where Audi now holds a 42% share of the premium car market. Early in the year, the Chinese government took aggressive steps to revive faltering momentum in the country’s automotive market – now the single largest national market in the world. It is now Audi’s second-largest market, after Germany.

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House Approves Another $2 Billion in Clunkers Cash

Buyers drain initial $1 billion in less than a week.

by on Jul.31, 2009

As many as a quarter million Clunkers could be crushed under the CARS program - even more if the Senate signs on to a $2 billion expansion of the Cash-for-Clunkers program.

As many as a quarter million Clunkers could be crushed under the CARS program - even more if the Senate signs on to a $2 billion expansion of the Cash-for-Clunkers program.

If there’s a chance it’s broke, fix it.  That seems to be the preemptive mantra of federal lawmakers, responding to word that the Cash-for-Clunkers program is ready to run out of gas, or, more accurately, cash.

The program, conceived as a way to kick-start the sluggish American automotive market, was passed by Congress, in June, though it only formally went into operation a week ago.  Officially known as CARS, for Cash Allowance Rebate System, it provided vouchers worth up to $4,500 for those trading in old vehicles for newer, more fuel-efficient models.

Originally intended to run through November, and to help promote the sale of around 250,000 high-mileage models, there are preliminary indications the Clunkers program is far exceeding even the most optimistic expectations.  Already, the CARS fund has issued vouchers to about 96,000 motorists, but with overloaded dealers struggling to fill in the paperwork, observers now believe that the $1 billion set aside by Congress may already have been exceeded.

High-mileage insight!

High-mileage insight!

“My showroom is packed,” said dealer Earl Stewart, of Earl Stewart Toyota, in Riviera Beach, Florida.  He added he is “really concerned” that he may not be able to complete sales with 61 new customers if, in fact, CARS has run out of cash.

Dealer Stewart isn’t the only one worrying.  In a Friday afternoon meeting with reporters, Pres. Barack Obama noted that the Clunkers program has “succeeded well beyond our expectations and all expectations,” but warned that there “legitimate concerns funding in this program may soon go out.”

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Marty’s Marketing Minutia

Engaging, engine and endangered

by on Jul.31, 2009

Ford’s Tempting Taurus Advertising 

Ford is putting on a heavy push to promote the 2010 Taurus launch.

Ford is putting on a heavy ad push for the Taurus.

Thursday’s reveal of the new advertising for the new 2010 Taurus was held in the vast space of Ford’s digital design studio with stunning video capabilities that were utilized to the fullest.

The presentation of the rationale behind the advertising for such an important launch of Ford’s “halo car” was as impressive as the commercials, print ads and web videos were.

The new Taurus deserves its own recognition and rewards from essentially a new group of prospective buyers.  I applaud Ford’s decision not to, as some auto writers on hand suggested, that Ford should have returned to days of yore and wonder of 1986.

Marketing insight - free!

Marketing Insight - Free!

Well, 1986 is history, dead history.

Twenty-three years ago the Dow Jones was 1,995, a stamp cost .22¢, oil was $11 a barrel and Oprah show began.  Too many years have elapsed to resort to historical precedence as a basis of evaluation or promotion of such an important vehicle.  And who gives a damn about the old models anyway?

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Spy Shot: 2012 Hyundai Sonata Hybrid

Hyundai finally readying a gas-elecric

by on Jul.31, 2009

Late to the party, the Korean carmaker intends to finally get into the gasoline-electric market with the launch of the 2012 Hyundai Sonata Hybrid, captured here by our spy photographers.

Late to the party, the Korean carmaker intends to finally get into the gasoline-electric market with the launch of the 2012 Hyundai Sonata Hybrid, captured here by our spy photographers.

The Sonata, codenamed “YF,” was penned at Hyundai’s design studio in Irvine, CA. We were told there was heated debate in the boardroom over the styling direction of the new Sonata. The final design sports a much sleeker, coupe-like roofline.

We’re hearing that the hybrid model of the Sonata, shown here, will use lithium polymer batteries instead of the often discussed lithium-ion. The polymer batteries are said to be more durable and cheaper to make. Besides obvious clues (our quick sneak-peek under the hood and small exhaust pipe) – this test group consisted of Hyundai’s well-known hybrid battery specialists, and the Sonatas were tested alongside a variety of competitive hybrids.

Your spy shot source!

Your spy shot source!

While the regular Sonata should start production for the U.S in the summer of 2010, the hybrid model should follow sometime in 2011 – likely as a 2012 model.

More pictures can be found at www.LeftLaneNews.com

Brenda Priddy & Company

Taurus Technology Featured in Ad Campaign

Putting the Taurus name back in play was the easy part.

by on Jul.31, 2009

Ford is focusing on the many electronic systems included in the new 2010 Taurus as part of its advertising campaign, including the MyKey system, which gives parents control over how their teens drive.

Ford is focusing on the many electronic systems included in the new 2010 Taurus as part of its advertising campaign, including the MyKey system, which gives parents control over how their teens behave behind the wheel.

Ford has to show people that while the Taurus nameplate remains, there is a whole new car behind it. Matt Van Dyke, Ford marketing director, says good news about Taurus is that it has very high name recognition, something like 87%. The bad news is that a lot of the people who recognize the name don’t think much about.

The challenge for Ford’s marketing team is to create a more favorable impression of the car through an aggressive advertising campaign that will use television and newspapers, and a broad digital campaign complete with some clever videos “experiential” advertising that drives home the point that Taurus is completely new and is vastly different from the old sedans that populated rental fleets from coast to coast.

“This is a transformational car for us,” Van Dyke said. “This is a whole new approach to using ‘word of mouth’ that will showcase our fantastic new Taurus. Just as Taurus is reshaping the idea of what a sedan can be, this campaign will reshape how people learn about Taurus.”

Subscribe to TheDetroitBureau.comThe 2010 Taurus is priced starting at $25,995 but running up to almost $40,000 for SHO performance model. The base price is the same as the outgoing model. But the “Webisodes” pit the technology features and quality found against more expensive luxury sedans from Audi, Lexus, Acura and Infiniti.

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Nissan Inks Battery Research Deal with Enerdel

The company is betting heavily on electric cars after rejecting hybrid technology.

by on Jul.31, 2009

Tiida EV

The production-intent Nissan EV will make its official debut next week.

Nissan Motor Company has signed a contract with EnerDel and its parent company Ener1, an Indiana company that has been working on advanced lithium-ion automotive batteries.

The research is targeted specifically at developing a new generation of electrical conductive material intended to reduce cost and improve the performance of electric and hybrid vehicle batteries. The company is betting heavily on electric cars after rejecting hybrid technology.

“This project is about continuing the evolution of a critical technology,” said Charles Gassenheimer, CEO and Chairman of EnerDel, parent company Ener1, Inc.

“Nissan is one of the leading companies driving the electric vehicle market today. Over 12 months of discussions on this effort, our management and technical teams have had a tremendous opportunity to get know one another. We are looking forward to successful realization of this project’s important goals.”

EnerDel recently cut the ribbon at one of the most advanced battery production lines for large format cells at its Indianapolis plant. The facility is currently the only high volume manufacturing facility for automotive lithium-ion batteries in the U.S.

Several other companies are also moving forward with plants for building lithium-ion batteries in the U.S., even though tests of the emerging technology remain incomplete. However, tests by GM, Ford and their battery suppliers such as Saft and A123 have bolstered the case for using lithium-ion batteries in both hybrids and pure electric vehicles.

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Sneak Peak: The BMW Group at Frankfurt 2009

The BMW Group for the first time displays all three of its brands in one place.

by on Jul.31, 2009

BMW Frankfurt Display 2009

Visitors will be seeing the vehicles in motion during the Frankfurt show.

When the BMW Group for the first time displays all three of its brands under one roof the Frankfurt Motor Show opens this September, the BMW Group for the first time displays all three of its brands under one roof in Hall 11.

The highlight of BMW’s 2009 motor show presentation is a circuit of several hundred meters length that encloses the entire exhibition space and on which the BMW fleet and several world premieres will be presented. Visitors will be seeing the vehicles in motion during the show.

The news at the BMW stand will be on the world premieres of two hybrid vehicles, BMW ActiveHybrid 7 and ActiveHybrid X6, as well as on the world premieres of the BMW 5 Series Gran Turismo and the BMW X1. A concept car is also promised.

In 2003, 2005 and 2007, the BMW brand presented itself in a Cubist building on the so-called Agora while MINI and Rolls-Royce Motor Cars were located in different halls. Presenting the three brands so close to each other this year will allow BMW Group to stage various corporate initiatives.

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Nissan Posts ¥16.5 Billion Loss in First Quarter

Globally, Nissan sold a total of 723,000 vehicles in the April-to-June period, down 22.8%.

by on Jul.30, 2009

Nissan's Carlos Ghosn

"2009 continues to be a tough year, but we are beginning to see positive results from the measures taken under our Recovery Plan."

Nissan Motor Company  Ltd announced a net loss after tax of ¥16.5 billion ($170 million, euro €120 million) in the first quarter of fiscal year 2009, which ends March 31, 2010, compared to net income of ¥52.8 billion yen ($540 million) from the same period a year ago.

Net revenue fell 35.5% to ¥1.5 trillion ($15.55 billion). Nissan’s operating profit totaled ¥11.6 billion ($120 million), down 85.5%, while the ordinary loss amounted to ¥26.1 billion($270 million).

Globally, Nissan sold a total of 723,000 vehicles in the Q1 April-to-June period, down 22.8% compared to same period in 2008. In North America, sales were 225,000 units, down 31.6%. Sales in the United States were 173,000 units, down 31.5% in a market that continues to decline. In Japan, sales were 116,000 units, down by 21.6%. European sales were 118,000 units, down 24.6%. China grew with sales up by 9.3% at 145,000 units. Sales in other regions were down 29.8% to 119,000 units.

The first quarter saw the launch of three products  — Pixo in Europe, NV200 in Japan and G37 convertible in the United States. In fiscal 2009, Nissan says it will launch a total of eight all-new products globally.

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Cash-for-Clunkers Funds Could Run Out Fast

Sales soaring, auto stocks rising, but CARS program may need more funding.

by on Jul.30, 2009

More than 10% of the $1 billion set aside for the Cash-for-Clunkers was paid out less than a week into the program.

More than 10% of the $1 billion set aside for the Cash-for-Clunkers was paid out less than a week into the program.

Anyone who wondered whether the cash-for-clunkers program would actually spur demand in the moribund U.S. auto market no longer need worry.  The $1 billion federal pot designed to get motorists to trade in their old, inefficient vehicles for newer, high-mileage models has received a roaring welcome from consumers, carmakers as diverse as Ford and Subaru hinting July could be their strongest month in quite some time.

Less than a week after the program officially began, federal officials reported that a full 10% of the money set aside for what is formally known as the Car Allowance Rebate System, or CARS, has already been paid out.  That’s leading some lawmakers to question whether more money might be set aside by Congress.

“Having this program last for only a few weeks would limit (its) potential and disenfranchise a number of consumers who wish to take advantage of the program,” Candice Miller, a U.S. Congresswoman from suburban Detroit, wrote her colleagues, adding that, “The program has the possibility to truly jumpstart our economy.”

Subscribe to TheDetroitBureau.comIt’s certainly helping kick-start investor interest in the industry.  Ford Motor Co. shares surged as high as $7.48, today, before settling back to close at $7.39, the highest end-of-day figure in a year.

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First Look: 2010 Suzuki Kizashi

"The complete transformation of our brand."

by on Jul.30, 2009

There's a lot riding on the new midsize 2010 Suzuki Kizashi.

There's a lot riding on the new midsize 2010 Suzuki Kizashi, company officials promising it will bring "the complete transformation" of the Suzuki brand.

Few products have been asked to play such a significant role, but American Suzuki has a lot riding on the upcoming launch of its 2010 Kizashi sedan.

The Japanese maker has long been little more than a niche player in the critical U.S. market – even though it is now the world’s 11th largest automotive manufacturer.  With the addition of the midsize Kizashi to its line-up, Suzuki is hoping to move into the mainstream.  It’s an ambitious – some would say audacious – plan, with the Japanese automaker not only planning to take on big name brands, like Toyota, with its Camry, and Honda, with the Accord, but even some luxury marques, such as Acura.

Great Things to Come!

Great Things to Come!

“This product will complete the transformation of our brand,” said Gene Brown, American Suzuki’s vice president of marketing, during a preview of the 2010 Suzuki Kizashi.  The sedan will also have to help reverse a sharp sales decline, among the worst among any brand competing in the American market.

In Japanese, Kizashi means “something great is coming,” and Suzuki put that message out when it first showed the sedan, in concept car form, at the September 2007 Frankfurt Motor Show.  It reappeared, a half-year later, at the New York Auto Show.  Now, Suzuki officials confirm the production version is due to hit showrooms by the end of 2009.

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