Posts Tagged ‘auto marketing’

Charging Up The Public: How To Market Battery Cars To An Uncertain Public

by Bryan Laviolette on Jul.30, 2010

Nissan is making the new Leaf battery car a corporate statement. But will potential buyers understand Leaf's pros and cons?

As Nissan and Chevrolet prepare to launch their groundbreaking electric vehicles later this year, they face a huge task educating the public about just what they are – and aren’t.

Marketing a new car is always a challenge, and something that can cost a maker as much as $100 million for even a relatively conventional product.  Now add a battery drivetrain and the challenge – if not the cost – could go up exponentially.

The Nissan Leaf is a pure electric vehicle with a range of about 100 miles and. Nissan calls it the first mass-market electric vehicle – though some might quibble with that and point to the battery cars the industry tried to push in the early 1990s.

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The technology under the hood of the Chevy Volt is even more unusual. General Motors calls it an extended-range electric vehicle (rather than a plug-in hybrid, a difference a bit more than just semantics). The Volt can travel about 40 miles on a full charge. At that point, a small gasoline engine starts to provide up to 300 additional miles. When it runs out, pull into a fuel station to fill up for another 300 miles, just like a traditional car. It’s still an electric vehicle because the gasoline engine drives a generator, so it never directly powers the vehicle.

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DOT Pressures Law and Auto Makers over DD

Transportation Secretary LaHood calls a Second Distracted Driving Summit as Congress, industry ignore the deadly issue.

by Ken Zino on Jul.28, 2010

Particularly lethal is the widespread use of cell phones, now a global problem.

While the National Highway Traffic Safety Administration is prohibited by the U.S. Congress from promulgating regulations concerning distracted driving, Transportation Secretary Ray LaHood has been using his “bully pulpit” to oppose the well financed auto, electronics and cell phone lobbies whose devices are enabling almost 6,000 deaths each year and more than 500,000 injuries. (See Smart Phones Add to Distracted Driving Epidemic)

Congress is showing no interest, to put it politely, on telling voters to stop using cell phones during an election year when all incumbents face ousting from angry voters.

Auto companies have their own conflicts of financial interest in this area, as they compete with each other to add more electronic devices to equipment lists. (See BMW to Offer Incoming E-Mail with Voice Output and DC Showdown over Distracted Driving Lobbyists)

Therefore there is no surprise in this bureau that LaHood has just announced that a second National Distracted Driving Summit will be held on 21 September 2010 in Washington, DC. More than 100 million people each day are now engaging in dangerous distracted driving behavior.

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First Look: Audi A7 5-Door Hatchback

New A7 five-door "coupe" debuts in Europe this fall for €51,600.

by Ken Zino on Jul.27, 2010

Audi is trying to sell some utility and some styling sizzle in an odd configuration at a premium price.

Audi has pulled the wraps off its latest full-size model – the A7 Sportback. The sleek five-door is an attempt to see if there is a growing market for a large, luxurious hatchback design.

Typically hatchbacks are associated with inexpensive compact cars, particularly in the United States.

However, Honda and Acura are working the same area of a thus far unknown market segment with the Crosstour and ZDX models that are currently on sale and very close in dimensions to the A7. BMW is also very much a factor here with its X6, err, SUV. (See First Drive: 2010 Honda Accord Crosstour and BMW X6 M Debuts in New York )

Audi claims the A7 has “the sporty elegance of a coupe, the comfort of a sedan and the practicality of a station wagon.” The German company will find out if potential buyers agree when the quasi-sporty, quasi-luxury car appears this fall in dealers with a € 51,600 ($67,255) starting price.

Open wide for 49 cubic feet of cargo capacity when both rear seat backs are folded forward.

How this segment is classified – crossovers, SUVs, fastback wagons, 4-door hatchbacks, 5-door hatches – will no doubt be the subject of an interminable industry debate, as marketers look for the magic words that will motivate people to spend premium dollars for utility that is less expensively and more efficiently obtained in mainstream offerings.

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Sorting the Nomenclature!

While the A7 has the signature Audi grille and option LED headlights that are becoming a distinctive design cue, focus will be on the large rear hatch that provides access to a 535-liter (18.89 cu ft) capacity, which increases to a volume of 1,390 liters (49.09 cu ft) with the rear seatbacks folded forward. The styling works against optimizing room here.

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Hybridized Ford Focus RS Coming to America?

Rally-inspired RS would adopt 2-liter EcoBoost and electric motors.

by Bryan Laviolette on Jul.23, 2010

The next version of the high-performance Ford Focus RS may use hybrid power to dominate its segment.

Ford of Europe is working on an all-wheel drive, hybrid version of its RS rally-inspired high-performance car. Could it be destined to show up in the U.S.? So far, the automaker isn’t saying.

“Rumors are fun, aren’t they?” a Ford spokesman said in response to a query about a U.S. version of the car. He also refused to add anything to those rumors.

Ford is readying a new Focus that will be shared by all global markets with the car going on sale in 2012.

The automaker wants to use the new RS to showcase technology, in this case a hybrid powertrain with the electric motors powering the rear wheels.

The new RS will use a 250-horsepower version of the 2-liter four-cylinder EcoBoost, which will also power the Ford Edge and new Ford Explorer beginning in 2011. Current versions of the RS use a 305-horsepower 2.5-liter five cylinder Volvo engine that drives the front wheels only.

For years, Ford has kept the RS version of the Focus out of the U.S.

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Sorting Face From Fiction!

Derrick Kuzak, vice president for product development, confirmed to Autocar that Ford is working on the new RS to debut at the Geneva Motor Show in Switzerland, saying the automaker plans to build a “global performance version” of the Focus.

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GM Back in Auto Financing with AmeriCredit Buy

Cash transaction creates a new captive finance company at General Motors to provide more vehicle loans and leasing.

by Ken Zino on Jul.22, 2010

Is Whitacre creating his own empire, just as he did at SBC, in effect reassembling AT&T ?

General Motors Company and AmeriCredit Corp. (NYSE: ACF) today announced they have entered into an agreement for GM to acquire AmeriCredit, an independent – and more importantly successful – auto finance company in an all-cash transaction valued at about $3.5 billion.

The acquisition creates a new GM captive financing arm that will enable GM to provide potential customers with more credit options. GM claimed it would not change its current incentive plans in the U.S., which are among the industry’s highest. If true, this means that taxpayers would not incur increased costs from more of the kinds of subsidized financing that auto companies often use to bolster sales.

Thus far this year GM sales are not increasing as fast as the overall market. Auto companies continue to incur loses because of overly optimistic residual values for returning lease vehicles.

GM said it needs to provide financing to “non-prime” customers – 40% of the U.S. population but only 4% of its current car buyers – who are remain pariahs in the credit markets despite lavish taxpayer financed bailouts of Wall Street firms and big banks that totaled almost a trillion borrowed dollars  – and were designed to free up credit, according to the Obama Administration.

Under the terms of the agreement approved by both companies’ boards of directors, AmeriCredit shareholders will receive $24.50 in cash for each share of stock held as of the closing date, which is due by the end of the fourth quarter of 2010, pending various conditions, including the approval of AmeriCredit shareholders

GM’s proposed purchase price is about a 25% premium over AmeriCredit’s closing share price on Wednesday. AmeriCredit has traded for as high as $26.49 a share this year.

“Adding AmeriCredit to our team will improve our competitiveness in auto financing offerings, and I am very pleased to have them on board,” said GM Chairman and Chief Executive Officer, Ed Whitacre about the Texas based financing company.

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Following Your Money!

GM claimed it will maintain its relationship with Ally Financial, the renamed GMAC, which is and now an independent taxpayer-owned company that provides retail and wholesale financing to GM and Chrysler Group. Currently GM has 57% of its transactions in the retail prime market through Ally and other banks, above the industry average of 53%.

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Domestics Outperform Imports in Vehicle “APEAL”

A 13-year streak ends as Detroit replaces or kills older models.

by Ken Zino on Jul.15, 2010

New Motown metal means renewed interest among potential buyers.

For the first time since 1997, domestic auto brands surpassed import brands as a whole in vehicle appeal, according to the J.D. Power and Associates 2010 Automotive Performance, Execution and Layout Study released today. (See the chart at the end of the story.)

In 2010, the APEAL score for U.S. domestic brands averages 787 on a 1,000-point scale. This is 13 points higher than the score for offshore brands, defined as automakers headquartered in Europe or Asia Pacific. By comparison, in 2009, import brands outpaced domestic brands by five points. This 18-point swing is statistically relevant, and is the latest sign that Detroit makers, notably Ford Motor Company and General Motors Company are improving their products at a time when offshore brands, Toyota in particular, are having well publicized problems. (See American Automakers Dominate AutoPacific’s “Ideal Vehicles”)

Toyota finished second to last among makers with only Jeep ranked at 33rd below it. Of the Chrysler Group brands, only Ram truck finished above average and Chrysler itself finished 31st. To be fair, Toyota has never done well in the survey – last year it finished in the same 32nd spot – since its buyers are looking more for quality and durability, which the survey is not designed to measure.

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Data!

In another Power study that does track quality, there is more good news for Detroit makers since the Initial Quality Survey released last month shows that Detroit makers, on the whole, made substantial improvement in the 2010, which measured out-of-the-factory quality for the latest cars, trucks and crossovers. Ford, in particular, dominates the latest study, and moves aside such stalwarts as Honda and Toyota to rank as the highest-quality mainstream brand.

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Build Your Own Corvette Engine Option Added

Unique program lets customers create the heart of their 'Vette.

by Ken Zino on Jul.12, 2010

Rich McBride at the GM Performance Build Center is one of the technicians who will supervise customers in the assembly of their own Corvette engines.

In what is likely the world’s most hands-on super car program, customers who order a 2011 Corvette Z06 or ZR1 can choose an option to help assemble their cars’ LS7 or LS9 engine at the General Motors’ Performance Build Center (PBC) in Wixom, Michigan.

This latest and innovative marketing program, called the Corvette Engine Build Experience, was announced this morning.

The Engine Build Experience is an option with a suggested retail price of $5,800. Yes, you pay more to get your hands dirty by helping to assemble your $100,000 ‘Vette – as I said there’s marketing genius here.

When a customer selects the PBC option for a 2011 Corvette Z06 or ZR1 and the dealer submits the order to Chevrolet, a special concierge contacts the customer to verify participation and help coordinate arrangements.

While travel arrangements to and from Detroit are the customer’s responsibility, the Chevrolet concierge helps schedule the engine build; coordinates the customer’s activities at the Performance Build Center; assists with booking local lodging and meals, and arranges local transportation.

“In a way, this is a dream program for a Corvette customer. I would have jumped at the chance to build the 427 in my ’67 ’Vette, and that didn’t have half of what goes into one of these modern precision engines,” said Tom Stephens, GM vice chairman, Global Product Operations.

“Today’s LS7 and Corvette engines are pinnacle achievements in engineering, and to personally involve our customers in their final creation shows the depth of Chevrolet’s commitment to make lasting connections with the customer,” said Stephens.

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Hands On Coverage!

At the PBC, the customer does not view the engine’s assembly – he or she builds it under the supervision of and support from skilled – and presumably very patient – technicians. When the engine is assembled, a personalized nameplate is added to the engine next to the builder’s name. It is then sent to the Corvette assembly plant for installation in the customer’s car.

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Fiat Cinquecento Prima Edizione Revealed

The special Limited-edition Fiat 500 is reserved for Fiat fans.

by Ken Zino on Jul.12, 2010

Fiat fans place reservations for the First Edition at the Fiat Mobile Experience in Asheville, NC.

Fiat fans attending the annual convention of the Club Fiat-Lancia Unlimited this past weekend were given the chance to place reservations and select their vehicle build number for a Fiat Cinquecento Prima Edizione or First Edition model.

A total of 500 of what Fiat is calling “collector-edition” 500 models will be sold in the United States starting at the end of this year.

The Prima Edizione announcement was made during the national annual convention organized by Club Fiat-Lancia Unlimited, North America’s largest enthusiast club for owners of Fiat Group Automobile vehicles. This year, the convention, also known as the “Fiat Freakout,” was held in Asheville, NC.

Fiat North America was the main sponsor of the annual convention, which featured displays of more than 100 well-preserved Fiat, Lancia and Alfa Romeo vehicles.

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Ciao!

Last week Fiat announced that after a 26-year hiatus, it would establish 200 dealerships in the United States managed by existing Chrysler dealers. At first, only the sub-compact 500 will be available. A convertible or cabriole version comes in 2011, followed by an electric version in 2012. Presumably, other Fiat models will follow.

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Smart or Dumb Sales Plan?

Customization option is likely the most aggressive ever offered.

by Bryan Laviolette on Jul.08, 2010

Turn a Smart fortwo into a personal statement with the maker's new Smart Expressions program -- but is it little more than a gimmick?

With sales taking a sharp tumble, Smart USA is hoping to rebuild demand by giving buyers the ability to extensively customize the brand’s fortwo microcar.

The new program, dubbed Smart Expressions, will not only let buyers choose from 93 paint colors, but also bring a color swatch of their own to match the color of their car to just about anything – whether a shade of lipstick or the colors of a favorite sports team.

Smart will also offer a series of full or partial vehicle wraps. Eventually, buyers may be offered the ability to design their own vehicle wraps.

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Marketing!

Smart is looking for some sort of spark to bring it out of its sales funk. Earlier this year, Jill Lajdziak, former general manager of GM’s Saturn brand, was tapped by Smart USA distributor Roger Penske to take over from the brand’s first manager, Dave Schrembi. Sales dropped 38% between its 2008 launch and the 2009 sales meltdown that affected the entire auto industry.

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DC Showdown over Distracted Driving Lobbyists

Secretary of Transportation takes on special interests.

by Ken Zino on Jul.07, 2010

"When it comes to safety, this DOT is holding firm," says Ray LaHood.

If you want an example of the unhealthy influence of money in “pay to play” Washington, look no further than the past head of the National Transportation Safety Board.

In a memo obtained by FairWarning and published on its website, Jim Hall, the former NTSB head (and then a hired spokesperson for Ford during the Firestone tire controversy), is being promoted as the lead spokesperson in an effort to stop the growing movement to regulate the devices that cause Distracted Driving.

The fact that such a lobbying proposal exists – it is called Drivers for Responsibility, Innovation and Vehicle Education or DRIVE – is deeply concerning to advocates of getting money out of politics in revolving door Washington where regulators routinely lobby their former agencies. (Click here for the DRIVE proposal) DOT itself is under criticism for hiring former Toyota employees who then allegedly ignored a growing number of unintended acceleration complaints at former employer Toyota.

DD is without question a deadly automotive safety epidemic – causing 5,000 to 6,000 deaths and more than 500,000 injuries annually, according to the National Highway Transportation Safety Administration.

Moreover, Illinois Republican Ray LaHood, the head of the Department of Transportation that NHTSA is part of, is an outspoken critic of the growing use of cell phones and other electronic devices that are the root cause of the problem.

LaHood is pushing hard for regulatory and other solutions at the state level, since NHTSA does not have the statutory authority under its Congressional authorization to regulate DD on a national basis.

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Not Distracted on Safety!

In addition, Congress is showing no interest, to put it mildly, on telling voters to stop using cell phones during an election year when all incumbents face ousting from angry voters.

Moreover, the auto companies have their own conflicts of financial interest in this area, as they compete with each other to add more electronic devices to equipment lists. (See BMW to Offer Incoming E-Mail With Voice Output)

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