Episode 447 – Global Car Sales Slow Down, Honda Raises Forecast, Heat Shuts Down Production

August 2nd, 2010 at 12:01pm

Runtime 7:17

New-vehicle sales around the globe slow down and analysts predict that by the end of the year monthly sales will be even with 2009. Honda raised its profit forecast for the year, thanks to increased car and motorcycle sales. Russian automaker AvtoVAZ shuts down production because it’s too hot! All that and more, plus a look at the new Buick Regal.

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Transcript and Story Links after the jump . . .

This is Autoline Daily for August 2nd, 2010. And now, the news.

CAR SALES SLOW DOWN (subscription required)
Is the global economy starting to slow down? Maybe. According to Ward’s, global new-vehicle sales were up 27 percent in the first quarter, but growth in the second-quarter was only 14 percent. Trend lines indicate that by the end of the year, monthly sales figures will be even with 2009. Global vehicle sales for the first-half of the year totaled 37 million units compared with 31 million for the same period in 2009. And that would suggest the second-half will be real slow.

But even though sales are starting to slow down around the world, it looks like they’re improving in the American market. Bloomberg reports that July will probably be the best month of the year so far. It says the market may hit an annualized rate of 11.9 million. Still weak, but better than the month before.

Meanwhile, Ford says that retail demand is picking up in the American market. Much of the increase for the Detroit Three this year was fueled by an increase in fleet sales, but now it looks like more retail customers are coming back into the market. Ward’s reports that Ford is looking for July sales to increase over a year ago, despite the fact that the cash-for-clunkers program started in late July of last year.

And maybe that helps explain this next report. For the first-time ever, Honda produced more vehicles in the U.S. than in Japan. Not by much, only 260 cars, but it is a milestone.

And Honda also increased its full-year profit forecast. According to the Detroit News, the company posted a $3.2 billion net profit in the first quarter, thanks to increasing car sales and strong sales of motorcycles in emerging markets. Honda raised its full-year operating profit estimate to nearly $5 billion.

Apparently the U.S. isn’t the only market where import brands are popular. So is China. According to Gasgoo, even though the auto market is starting to slow in China, sales of imported cars are red hot, increasing nearly 115 percent in May. Imported vehicles with engines smaller than 3.0-liters are the most popular models.

It’s been a long, hot summer in most of the Northern Hemisphere this year. AvtoVAZ, the Russian automaker, just announced that it is going to shut down car production this week because it’s just so dang hot. Bloomberg reports that temperatures in Togliatti, in southern Russia, are expected to hover in the 45 degree Celsius range. That’s 113 degrees Fahrenheit.

Here’s a little factoid I wasn’t aware of. Harley Davidson makes sidecars, well, at least for the time being. According to Autoblog the motorcycle manufacturer has been in the outrigger business since 1914, but it just announced that twenty-eleven will be the final year sidecars are available as a factory option. In a press release it cited a “decline in retail demand” as the reason for their discontinuation. If you’ve got one on your bike no worries though, the company will still cover units under warranty and its dealers will stock replacement parts.

Coming up next, a look at the new Buick Regal.

The 2011 Regal represents a new beginning for Buick. With this car, the company is pushing into a segment it really hasn’t competed in before. Autoline Daily correspondent Craig Cole filed this report.

With Hummer, Saturn and Pontiac out of the way Buick is finally getting the resources it needs to grow.  A prime example of its expansion is the 2011 Regal.

A quick walk around this car is all it takes to understand that it’s a different kind of Buick.  It is definitely NOT your grandparents’ Roadmaster.

GM is going after competitors like the Acura TSX and Audi A4.  That may sound ambitious, but the Regal is built on a solid foundation, the Opel Insignia, 2009 European Car of the Year.

But why did Buick decide to call it Regal?  Were other historical nameplates like Century, Wildcat and Electra not as popular?

All this talk of “sport” and “performance” may sound like marketing doublespeak, but GM is actually backing up these claims.

Sure, the base engine won’t set the world on fire, but at 2.4-liters and 182 horsepower it’s perfect for everyday driving.

The optional powerplant is where things get interesting.  Borrowing a page from the tuner crowd, buyers can step up to a turbocharged four-cylinder engine delivering an ESTIMATED 220 horsepower.  It’s a fun combination, but GM has some even better news for enthusiasts.

It’ll be interesting to see how well the Regal sells, particularly compared to the redesigned Hyundai Sonata, which also offers a stylish body and a turbocharged four-cylinder engine.

Thanks for that report, Craig. Later in the week we’ll take a look at some of the nuts-and-bolts details of the 2011 Buick Regal and learn a little about how the car was developed, so stay tuned.

And that is it for today’s top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.

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13 Comments to “Episode 447 – Global Car Sales Slow Down, Honda Raises Forecast, Heat Shuts Down Production”

  1. Tony Gray Says:

    Haven’t seen the Regal in person yet, but if the interior is any way even close to the one in the LaCrosse, it will be on my short list when the wife’s Aura XR lease expires in March.

  2. dcars Says:

    Their has been a lot of Regals sold here in western New York, we buy lots of cars from GM and Ford. I haven’t looked at the interior yet.

  3. pedro fernandez Says:

    No mention of price on the Regal report I just read that the base car will go for about $27k about $6k more than the similar Sonata, I guess only those who need to buy American, will spend a lot more $$ to get basically the same car.

  4. Dave Says:

    I “built” a Sonata on the web cite and a turbo decked out, no NAV, was 28 grand. Bring it on GM

  5. pedro fernandez Says:

    Apples to apples please, a similarly equipped Sonata @ carsdirect.com $23,121. No turbo, just base 4 cyl. engine and 6 speed auto. Same as base Regal

  6. Chuck Grenci Says:

    Is my prejudice showing? I would consider a Buick Regal (Sonata is not on my list, nor a consideration); I’m a GM loyalist through and through.

  7. diffrunt Says:

    Harley offered a sidecar? Surely you jest!

  8. GPL Says:

    If I’m not mistaken, the “base” Regal available right now is not actually the base model, but a higher trim model with things like heated leather, dual zone climate control, bluetooth, etc standard, so to compare it to a Sonoata would require adding some extras. I haven’t bothered to compare them apples to apples, though. I’m just not that interested in either of them.

    Still, I wouldn’t be surprised if the Hyundai is cheaper. I think Hyundai is on a predatory pricing strategy right now, sacrificing margin for sales to increase their presence in the US market.

  9. Mohammad Rafi Says:

    The exterior of the new Regal does look great and, when seen in person, it does have the sort of styling that Buick badly needed to have in order to compete in the 21st century. But I don’t like the interior at all. Seeing what GM can do with the beautiful interior in the new CTS, it’s a shame that the same attention to detail and craftsmanship weren’t used for the Regal. And as it’s a fact that the average Buick buyer is close to 40 years-old, I don’t think that Audi or BMW have anything to worry about when it comes to Buick stealing their customers.

  10. Dave Says:

    I did see the new regal GS at a new car show and liked it alot and would look at one to buy. But, the talk is that tha turbo GS with the HHR SS motor at 235 auto and maybe 265 with a stick will be in the mid to upper 30′s. The new sonata will also have a 10 year powertrain warr., ON A TURBO CAR!!!! Heck ya.

    Just for the record my father has a 2009 HHR SS auto and it is bad fast, but is an lot lighter than the Buick will be..

  11. Nick Stevens Says:

    Recent Buicks have fantastic styling, and styling plays as big, if not bigger, a role in new car purchases than even reliability or MPG. You are what you drive. Or at least they may believe you are.

    The new buicks and especially the EXCELLENT Cruze will be a big problem for Ford, Camry, Acura, Infiniti, and especially CHRYSLER.

  12. Nick Stevens Says:

    I meant the CHEVY Cruze, of course. I read a very glowing review. Never before did any domestic make a ‘small’ car that not only is quite big and has OUTSTANDING MPG, it also feels like a much bigger car, vcery smooth and quiet, not a damned coffeemaker Cobalt or Cavalier or (insert worse small domestics here). THe Cruze will also take sales from a LOT of competitors.(Guess which ones)

  13. Jim Thykeson Says:

    The Regal nameplate harkens back to the 80′s for it’s time of glory. We recall the fabulous days of the turbo Regals along with the Grand Nationals and the Buick-McClaren GNX. From 84′ to 87′ these were the flagships of performance at GM. That 3.8 liter V6 was almost as versatile and popular as the small block Chevey. It was the little engine that could, from the drag-strip to Indy (still all time record) 238 Kenny Bernstien’s Quacker State Sp. If the new Regal can recapture some of that glory it should be a winner.