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Episode 657 – Oil Price Gripes, New 1 Series, Piles of Pickups

June 6th, 2011 at 11:40am

Runtime 8:52

A Saudi Prince wants to see lower oil prices to keep Americans and Europeans from seeking alternatives. BMW unveils its all new 1 Series along with its treasure trove of new features. Pickup trucks of all makes and shapes are piling up across the U.S. as sales slow due to gas prices. All that and more, plus a look at how the auto industry and the EPA are training engineers to make more fuel efficient vehicles.

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This is Autoline Daily for June 6, 2011. And now, the news.

OIL PRICE GRIPES
Everyone is complaining about the price of oil these days, even the Saudis. In an interview on CNN, Saudi Prince Al-Waleed bin Talal says that he wants lower oil prices in order to discourage the U.S. and Europe from looking for alternative sources. He said, and I quote, “We don’t want the West to go and find alternatives, because, clearly, the higher the price of oil goes, the more they have incentives to go and find alternatives.” He says that the price of oil should be somewhere between $70 and $80 per barrel. Currently the price is over $100 a barrel. Prince Talal blames the political unrest in the Middle East and disruptions in supply due to the unrest as the cause for high oil prices.

NEW 1 SERIES
We’ve just got the latest details on the all-new BMW 1 Series.  This entry-level BMW now shares a platform with the larger 3 Series, and, as a result, gains interior and cargo room.  Powerplants include two direct-injected, turbocharged four-cylinder engines capable of 136 and 170 horsepower in the U.S.  Overseas customers will also have two diesels to choose from including the 2.0-liter shared with the 3 Series and 5 Series.  All engines come standard with a six-speed manual or optional ZF eight-speed automatic with stop-start technology and regenerative braking.  On the interior the littlest BMW gains more refined appointments and soft-touch materials compared to its predecessor, according to Autoblog.  One thing that hasn’t changed, the 1 Series will retain rear-wheel drive making it one of the only RWD cars in its segment.

PILES OF PICKUPS (subscription required)
Mark Reuss, GM’s president of North America, says the company WILL NOT turn to incentives to reduce big stockpiles of pickups. According to Ward’s, dealers are sitting on about a 122-day supply of Chevy Silverados, while the GMC Sierra is at roughly 116. Remember, the ideal inventory level in the U.S. is about 60 days. Reuss would not comment on how the company plans to adjust its production or pricing strategies to better match demand, but it doesn’t sound good for GM. Even so, compared to the competition they’re really not that out of whack. The light-duty Ram is sitting at about 93 days and the Ford F-Series at 80. Nobody is buying Nissan’s Titan. There’s a 199-day supply of them hanging around, and the story’s much the same for the Toyota Tundra at 143 days. How ironic, the Japanese are struggling to increase their inventory of cars.

RACE TO REPLACE MULALLY
Bill Ford has gone on record as saying whoever replaces Alan Mulally as CEO of the company will come from Ford’s existing executive ranks. They’re not going to recruit someone from the outside. So who will Mulally’s replacement be? Let’s take a look at the short list. Everyday this week I’ll show you who the top candidates are and I’ll pick who I think will be the next CEO on Friday’s show. And today we start with the Chief Financial Officer, Lewis Booth. Born in Liverpool, England, his father was a car dealer, so he grew up on the retail-side of the business. He later got an engineering degree, so he knows what it takes to engineer a car. Indeed, he is a true gearhead and loves motorsports. His career saw him take a series of management positions in Ford of Europe in product development, manufacturing, finance and sales. After that he moved to the United States in the 1990s where he went through a very similar rotation, always moving up the corporate ladder. He later became head of Ford’s Asia-Pacific and African operations, including a stint as the president of Mazda. And then went back as chairman and CEO of Ford of Europe. Clearly Lewis Booth has all the experience and skills to become CEO. In fact, if God forbid, Alan Mulally were to step off a curb and get hit by a bus, Lewis Booth could step into that role this afternoon without missing a beat. But there’s only one thing that could prevent Booth from succeeding Mulally. He turns 63 years old later this year. Traditionally, most top-execs retire at 65. And while Ford does not have a mandatory retirement age, this could clearly hinder Lewis Booth from taking the CEO position.

Coming up next, we’ll take a look at how the auto industry and the EPA are training a new generation of engineers to make more fuel efficient vehicles.

ECO-CAR COMPETITION
How do you grow a whole new generation of engineers who know how to work on hybrids, fuel cells, EVs and bio-fuels. Well, one way to do it is to create a competition amongst engineering schools to see who can do it the best. The U.S. EPA is sponsoring a competition called Eco-Cars, and in the following clip, Chris Grundler from the EPA, explains what it’s all about.

We should have the final results from the Eco-Car competition sometime this week.

And that’s today’s report on the top news in the global automotive industry, thanks for watching, we’ll see you tomorrow, with another installment in the race to replace Mulally.

Thanks to our Partners for embedding Autoline Daily on their websites: Autoblog and WardsAuto.com

52 Comments to “Episode 657 – Oil Price Gripes, New 1 Series, Piles of Pickups”

  1. G.A.Branigan Says:

    I remember back when the first oil crisis hit us,yup I’m that old.Drastic changes to our driving habits and the iron we used to drive.Now that the oil prices are ‘skyhigh’the Saudis are feeling the crunch where it has always counted,in the bank account.The only difference being is today’s report where a Saudis actually said it.Now that begs the question,will we go back to gashogs with the ‘maybe’ lower prices,or will the USA as well as the rest of the world continue to improve mpg’s and alternative fuel sources.I hope the latter proves out to be true,or…”let them eat sand” ;}>

  2. Lex Says:

    It seems clear to me that if Alan Mulally is going to step down at CEO of Ford, he’d better start grooming a replacement. If you are looking for someone to step into Mulally’s shoes I do not see a better candidate than Mark Fields. Mark Fields is currently Executive Vice President of Ford Motor Company, President The Americas. His experience and age make him a perfect replacement for Alan Mulally. I would love to see Mark Fields take over the reigns from Mulally with Bill Ford’s and the Boards Blessing.

  3. pedro fernandez Says:

    GA another diff between then and now is that China and India did not have the appetite for oil they have now, so even if we cut back, over there the demand is still rising.

  4. Tony Gray Says:

    Man, I do NOT like the front of that new 1 series. But who the hell am I?

  5. HtG Says:

    Boy, I VERY MUCH like the front. But who the hell am I?

  6. pedro fernandez Says:

    Being that the new 1 series is based on the 3 I can only guess the price will go up, funny thing is its sales were dismally low because it almost cost the same as the 3 and if they raise the price and the size of it, then it should sell even less.

  7. dcars Says:

    Al-Waleed bin Talal sounds like an insightful drug dealer. Aren’t both the Tundra and Frontier made in the US for US buyers?
    My guess for the next CEO of Ford is Mark Fields. He has international experience, he’s well versed in technological developments and is only 50 years old. An obvious choice, except for his miss step with Jet plane commutes to Florida.

  8. HtG Says:

    In the UK they pay 9.44 dollars per gallon of petrol, and 9.69 for diesel, according to my cocktail napkin. If an amerrrican SUV driver with a 25 gallon tank filled up at those prices, it’s 236 and 242, respectively. I would like to be Prince Bin Talal’s adopted son.(what’s one more?)

    Of course this is only hypothetical.

  9. tj Martin Says:

    WHAT DID I TELL YOU ALL !!!

    Hee Hee Hee

    Riase fuel prices to the point of the US consumer contemplating alternatives to Gasoline and what would happen ?

    Saudi’s ( who no matter what anyone tells you control OPEC ) lowers the prices .

    Predictable as all get out .

    TJ – 1 ( actually more like 101 )

    Cybil Sextet – 0

  10. tj Martin Says:

    HtG will love this .

    Tj went armed for bear , but wound up being the nice guy .

    2011 White GLK 4matic – Premium 1 AND the AMG appearance package …………. for less than the base model they have in stock .

    MINI’s equity pays for down payment and 24 months of payment out of 30 , PLUS the three year pre-paid service package so no repair or maintenance costs for the duration of the lease . Again for less than the base GLK 4matic

    Me likes Mercedes Benz !

    Did I do good or what ? And ……. and ……… I was nice for the love of Pete !

    Wife and I will be discussing this tonight as well as looking at the Subie on Tuesday .

  11. Chuck Grenci Says:

    I do appreciate the candor of Saudi Prince Al-Waleed bin Talal; refreshing that the truth be spoken, though I think that prices are just where they want them to be. (just filled up at Sams Warehouse for $3.42-9; and I thought I was getting a good deal) how times have changed.

    And EPA touting how they are in the matrix of improving fuel economy (when back in 2000 my Intrigue was getting 33mpg hwy, real, and now the newest offering are bragging that smaller cars can match that number).

    And John, and I do respect your opinion, still I see article after article in the newspaper saying the economy is fizzling; I still say the SAAR is effected by this (not Japan’s woes) as inventory hasn’t had time to be choked yet (as all around me, the Japanesse dealers are still out for business offering incentives to buy in my area; southeast U.S.). Just saying; I could be wrong; won’t be the first time.

  12. HtG Says:

    Saudi could try to diversify their economy. Say put sand in a box, and call it a Pet Beach! Or they can goose the economy if they can let women start driving on the new roadway system they’ll have to build to preserve the little ladies’ honor. BWTM! They can take over Citibank, and go into banking; what harm could they do?

  13. HtG Says:

    tj, what are your options for the term length? I thought there were also 36mo leases, and mileage allowances; all of which affected the monthly bill.

    You’re looking at the White one, eh? (Hating you quietly)

  14. tj Martin Says:

    @ HtG

    30 month lease is the M-B USA special for June so its the best price .i checked . I’m getting the 7500 per year milage with $0.25 per mile if I go over (very doubtful ) The paid service ( wold be $980 for the three ) is the best part .

    FYI The Saudi’s already own most of Citibank , and Aspen and ……….. heck they probably own the cloths on my back :(

  15. HtG Says:

    now do you see why we bailed out Citi at all costs? Whose petrodollars do you think were stuffed into that mattress?

  16. tj Martin Says:

    Lets face a cold hard fact about our Saudi ( urp ) buddies

    Bush senior all but handed the US to the Saudi’s in a lace covered hand basket . And what he didn’t GWB did.

    Which is why you have to love the Ultra Right Conspiracy theorists when they try to claim this is all Obama’s fault

    A distinct lack of culpability on their ( Right Wing ) part .

    @ Chuck Grenci ;

    Post # 11 paragraph 3

    I’m with you 100 % on this one and like you feel John , much as I respect the guy and have for years is a bit off base not crediting the Stalled at Best Economy for falling Auto sales .

    Seriously John , why do you think there are so many OWMNB’s ( out with money not buying [ real estate mainly ]) my age running lose : to the point of the major business text books even including us as a subject ?

  17. tom Says:

    The UK fuel prices are so high due to the tax load not the per liter price of the fuel.

  18. tj Martin Says:

    @ HtG

    Yup . The Arctic WHITE one !

    If we pop for the Benz , the white one it is . Sand interior walnut , trim etc

    Eat yer heart out !!! :o

    ( truth be known I was thinking about you when the dealer offered the better price on the more expensive white one . hopefully thats not the color of the Fashion Editors you told me about , but if it is se la vie . So who is it ?? the fashion editor with the chauffeured GLK ? )

  19. HtG Says:

    @16+17 Biting my tongue so hard.

  20. tj Martin Says:

    10 points for tom !

    post # 17

    ( I wondered how long it’d take for someone to come up with that )

  21. HtG Says:

    tj, here’s my bumper sticker, the only one I’ve ever had. It says merely, 01.20.09. When you solve it, just quietly hum.

  22. tj Martin Says:

    @ HtG

    got me stumped ! its Mrs tj thats the code breaker in the family

  23. RAFI NAJEEB Says:

    I love the looks of the new BMW 1-series. It evokes in me the sort of passion that one needs to have evoked by the styling of a BMW. Now, lets see if it drives as well as it looks. For too long, BMW’s cars, while being great drivers, weren’t styled properly. But now, things seem to be (hopefully) headed in the right direction. Also, I do hope the price doesn’t go much higher, so that this car can remain a fun to drive alternative to the boring FWD cars of the masses.

  24. tj Martin Says:

    Oh wait that ……

    never mind i got it ! Silly me !

    But …. WHO IS THE FASHION EDITOR with the GLK !

    dad burn it !!!

  25. HtG Says:

    sorry tj. Privacy. same reason I don’t succumb to figuring out what installation the better half works at. Ever read Stella Rimington?

  26. tj Martin Says:

    F1 News

    As of now there are over 500,000 worldwide signing a petition to be presented to the Red Bull Team and Red Bull ( the company ) asking Red Bull to boycott the Bahrain GP at http://www.Avaaz.org

    @HtG- I’m confused . What does the GLK Fashion Editor have to do with your privacy ? Without divulging too much of course .

  27. tj Martin Says:

    @ HtG

    re; Stella Rimington . No I hadn’t … but I should .

    I love a good spy novel based on facts rather than fantasy .

    I assume you’ve watched Syriana ?

    )

  28. HtG Says:

    That’s a clever campaign, as RB will likely have sewn up the championships by then. There has to be some contractual penalty for not showing up, though.

    on privacy, I simply don’t want to name someone and their car on the internets. I don’t like my own name being visible; it is, a little. I can say things more freely, eg things dealers tell me.

  29. HtG Says:

    anything Clooney, even The American.

  30. tj Martin Says:

    ” The American ” book – Brilliant !

    ” The American ” movie – Not bad !

  31. Chuck Grenci Says:

    Can’t stand Clooney; Harrison Ford (even at an age) gets my nod.

  32. tj Martin Says:

    BMW 1 Series

    Looks – A
    Interior -B-
    Interior space for footprint – D
    Value for the $ – F

    Will we get the Diesel , 5 dr hatchback etc ? Not according to BMWUSA .

    Which is why the 1 Series is such an abject sales failure in the US . A Golf has a bigger interior etc etc

    Then to add insult to injury BMW delays the release of the X1 in the US ( while its selling gangbusters in Europe )

    You lost a No Brainer sale on the lack of X1′s BMW ! To your competitors in Stuttgart .

  33. HtG Says:

    OT tj, tonight in NY PBS there’s a Claptonfest on Great Performances.

    http://www.pbs.org/wnet/gperf/episodes/eric-clapton-crossroads-guitar-festival-3/about-the-concert/1125/

    the more you know

  34. cwolf Says:

    tj: For as much as I want you and the Mrs. to have the GLK,I am wondering if leasing the vehicle,as good as a deal appears,is economically prudent. I think pedro made some good remarks about the forcasted ecomomy and encouraging you to drive the Subaru. By leasing the GLK,you’re willing to give away the Mini and perhaps some cash just to drive for 2.5yrs and only about 25k miles! The cost to drive may be zero,yet you have NOTHING at the end of the lease. Based upon todays news,I believe the economy will have a downward trend for maybe two or three years. If you can find contentment and pay cash for a Subaru,you may be in a better shape in a sour economy. And you will have maintained some value,if you choose to sell in the next couple years. One can also assume the Subaru will be easier to sell. Even if you’re finacially secure,I would only get the GLK if it were purchased with the intent to keep for a longer duration. It’s still a crap-shoot, so think wisely my friend.

  35. tj Martin Says:

    @HtG

    Ahh the joys of place . PBS KC aired that one Saturday night and I’d seen the entire concert on cable .

    But thanks anyway

    Hey . CD recommend Kronos 4tet” UNIKO ”

    Take one part John Adams & one part Sigur Ros and you’ve got the makings of an intriguing CD

    Also John Adams ” Son of Chamber Symphony ” as always brilliant

    Finally a reminder to all ;

    June 9th Bob Lutz’s ” Car Guys vs Bean Counters ”

    Be there or be square :o

    ( sorry SG , had to do it )

  36. tj Martin Says:

    @ cwolf

    Worry not , we’re looking at the Subies Tuesday night .

    Our reasons for leasing the GLK again are

    1- How good will the GLK’s reliability be
    2- What will the M-B experience be like
    3 -What will fuel cost be in 3 years ( not wanting to get stuck with an SUV we can’t give away )
    4- In this economy Cash is King and with the GLK we’re not spending any cash we already haven’t ( on the MINI )
    5- Plus the deal I negotiated today includes ( which is extra on M-B’s ) free servicing for the lease

    But Like I said I just got the numbers on the Subaru’s for purchase ( Forester XT and the Outback 3.6 including an offer on the MINI for trade in ) and will be driving them tomorrow .

  37. J W Talbot Says:

    Concerning GM’s (and others) excessive inventory of light trucks – in an earlier show you said that “sales” figures are actually “production” numbers. If so is GM possibly doing some funny accounting to bolster their profitability (and stock price)?

    How does the average guy get honest figures from these blue chip, too-big-to-fail companies?

  38. HtG Says:

    with Kimmo Pohjonen? Wow tj. How did you know my secret vice was accordion music?

  39. cwolf Says:

    tj: No worries,just reasonable thoughts of caution. Question is; what does gained service plan get you beyond standard warranty and can buy extended later? I predict not much gained. If you only drive this thing 7500 miles/yr, fuel cost concerns are moot. Cash may be king now,but you may wish you had some of it left 2 yr. from now!

  40. XA351GT Says:

    HtG @#21
    1.20.09 Obama’s inaguration date. Hum ?? More like fiddling while Rome burns IMO.

  41. HtG Says:

    9.1 and 270, there’s some important numbers

  42. ElectricFan Says:

    It’s nice that they are teaching engineering students how to design fuel efficient vehicles. However, it might be better to reserve part of the curriculum for pure EVs.

  43. tj Martin Says:

    @ cwolf

    The free service means all oil etc changes adjustments are free . They’re mandatory every 10 months at #1 $330 #2 $650 #3 $320 but now all are free for the period of the lease . So Zero repair or maintenance costs .

    @ HtG

    #37 Had no clue . Just saw the CD discussed in an article , sampled it on Kronos website , ordered it and love it . Listened to it all this morning in fact . Got the ” Driving ” ear test

    eg; If it catches my ear driving enough to come home and listen again to pay more attention to it , its a winner . And it was !

    A buy !

  44. tj Martin Says:

    GOOD Lord !

    Chrysler just took another step towards Hades

    Dr Dre is now the new spokesman for Chrysler ads .

    So how about Marchionne just admitting the only people that will buy his cars are burned out , past their sell by Gangsta Rappers

    Yeah that’ll bring in the business .

    ” Hey honey lets go take a look at the new Chrysler 300C and get shot at while we’re there . Maybe grab some crack as well “

  45. HtG Says:

    here’s another driving test. Try the G Variations by A Schiff. I almost crashed twice driving that disc home.(back when you could by this stuff in stores)

  46. Lex Says:

    The “Big Mistake” Chrysler did was not pressing the makers of the New Green Hornet Movie into using the New Chtysler 300C as the “New Black Beauty”. Even if the movie was a bomb, the car would have lived on in the memories of those who was the movie. Another missed opportunity by Chrysler CEO, Sergio Marchionne and Gang.

  47. Andrew Charles Says:

    The first 1-series was cramped but at least looked athletic, this one just looks pudgy.

  48. dcars Says:

    Hey John, any news as to when Ford will bring the Mondeo to the US to update the current Fusion? And secondly any thoughts on Mazda’s future in the US? Mazda seams to be the next Saab story.

  49. tj Martin Says:

    PROTEST CAN BE EFFECTIVE !

    Well , well , well . Look who’s relenting in his attitudes towards the Bahrain GP after some 1.5 million folks WorldWide lodged their protests against the event being rescheduled .

    Oh yes . The Poison Dwarf , Uncle Bernie is now ( autosport ) having second thougts as even the Motor Sport press is questioning the sanity of going to Bahrain for a Sporting Event .

    KIND of makes you wonder what might happen if 1.5 million Americans had stood up in protest to the selling of Chrysler to FIAT when MAGNA ( even if they are CDN ) would have been the better choice .

    Scream a little folks . Its the noisy wheel that gets the grease .
    Not the one no one can hear .

    After all . It is OUR country ! Its about time we stood up for it !

    And finally ;

    Two more days till the release of Bob Lutz’s ” Car Guys vs Bean Counters ” :o

  50. pedro fernandez Says:

    TJ if Fiat can save Chrysler good for them, Daimler and Cebarus gave up on this poorly managed company, so now it’s up to Fiat and Sergio, but I’m already reading articles on the “miraculous” comeback of Chrysler? Hold on there babalooie, too early to tell for sure, the jury is still out on that.

  51. pedro fernandez Says:

    Lex, sorry dude but I think Chrysler was smart for avoiding that Green Hornet crap movie that really sucked big time; people would have associated the Chrysler brand with this POS film, unlike the series that featured the iconic Imperial Black Beauty.

  52. HtG Says:

    Looks like the embargo has been lifted on Lutz. Here’s a link to an Atlantic piece about the new book. Don’t taze me, John!

    http://www.theatlantic.com/technology/archive/2011/06/why-gm-couldnt-be-apple-according-to-a-former-gm-exec/240006/