Episode 879 – Record Car Sales in March, Corvette Heads to Korea, GM Seeks Isuzu Stake

April 30th, 2012 at 11:50am

Runtime: 9:28

Global car sales hit a world record in March with nearly 8.25 million units sold. General Motors will start selling the Chevrolet Corvette in South Korea next month. And speaking of GM, reports out of Japan say the company will take a 10 percent stake in Isuzu, to jointly develop, produce and sell pickup trucks and commercial vehicles. All that and more, plus a look at the all-new Dodge Dart.

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Thanks for joining us for the beginning of a new week of watching the car business. I’m John McElroy, this is Autoline Daily, and now the news.

And when it comes to global car sales, the news is good. Ward’s reports that sales hit a world record in March with nearly 8.25 million units sold, a 5 percent gain compared to last year. That’s thanks to growth in China, Russia, India and North America.

And there’s good news for car enthusiasts in South Korea as well. GM will start selling the Chevrolet Corvette there next month. But get this, the base model, with 430-horsepower, will be priced at 86.4 million won. That’s about $76,000, which is 50 percent more than it costs in the U.S.! Since the U.S. and Korea now have a free-trade pact that lowers tariffs, looks like Chevy is pricing the car for high margins. Even so, are the Detroit Three finally going to get serious about exporting from the U.S. to the rest of the world again? Remember, we just reported that Ford is designing the next-generation Mustang with overseas sales in mind.

And then there’s sad news to report today. Dan Knott, the vice president of Purchasing of Chrysler succumbed to his fight against cancer. Dan was only 51 years old and was just hitting his stride as a senior executive. He was a true automotive enthusiast, having worked on the original Dodge Viper and as director of Street Racing Technology, SRT. He was also vice president of Engineering. He survived the debacles with Daimler and Cerberus and was primed to play a significant role in the company’s amazing comeback, and it’s sad to see the industry lose one of the good guys.

Last week GM CEO Dan Akerson said he wanted his replacement to come from within the company, which got us thinking, ok, who could it be? So, all this week I’ll be presenting you with the executives who I think might be in the running, and on Friday I’ll give you my analysis of who might get the top job. But you can’t tell the players without a scorecard, and first up on today’s scorecard is Tim Lee. He’s not as well known outside the company, but Tim Lee is a GM lifer who grew up on the manufacturing and labor relations side of the business. A native of Loraine, Ohio, he spent the much of his recent career overseas, including stints at Isuzu in Japan, at GM Europe in Zurich, Switzerland, and now in Shanghai, China where he is president of GM’s International Operations. He’s also the chairman of GM Korea and was just appointed to the supervisory board of Opel. In fact, he is in charge of almost all of GM’s operations except North and South America. All that international experience gives him the kind of resume that the board of directors at GM would love to see in choosing their next CEO. But it’s rare, very rare, to see manufacturing guys make it to the very top no matter how much other business experience they have. Even so, Tim Lee could prove to be the exception to the rule.


Speaking of GM and Isuzu, reports out of Japan say GM will take a 10 percent stake in Isuzu, again, to jointly develop, produce and sell pickup trucks and commercial vehicles in Asia and Central and South America. Analysts speculate that if the deal goes through, Toyota could sell its stake in Isuzu since they would be competing with each other. But I find it very curious to see GM signing up partners again after it was forced to drop those relationships when it went through bankruptcy.

The new Ford B-Max is kind of unique. It’s a subcompact MPV based on the company’s B-class platform. But what really makes it stand out are the doors, it’s rear sliding doors. Now I know what you’re saying, “John, that’s NOTHING new.” And you’re right, except for one thing. Engineers have managed to delete the B-pillar, which gives wide-open access to the rear seats. I’m amazed this thing meets crash standards, but high-strength and ultra-high-strength boron steel was the solution. 40 real-world side-impact crash tests verified all the computer simulations. According to Wardsauto.com, Ford will likely use this approach on other vehicles in its lineup. Say, maybe they could finally build a competitive minivan . . .

Coming up next, we finally get to report on the new Dodge Dart.

(The Dodge Dart overview is only available in the video version of today’s program.)

Yeah, we still haven’t driven all the powertrain permutations in the Dart, so we’ll have to reserve our final judgment until we do. But right now I’d rate the Dart as a better car than the Elantra, Civic and Corolla, but not quite as good as the Chevy Cruze or Ford Focus.

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But that wraps up today’s show, thanks for watching, we’ll see you tomorrow.

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38 Comments to “Episode 879 – Record Car Sales in March, Corvette Heads to Korea, GM Seeks Isuzu Stake”

  1. Brett Says:

    Looks like a nice “first effort” with the Dodge Dart. I wish them well.

    Seems like a lot of passing this past week. We lost a good friend quite unexpectedly to a massive coronary on Friday night. Fortune passes everywhere.

  2. dcars Says:

    GM efforts to tie up with Isuzu is their desire to return to the high margin medium to heavy duty truck market. That market is very cyclical and at the time that they closed the heavy duty truck division no one was buying. The current recovery changed all that and I bet GM is regretting that decision.

  3. Lex Says:

    GM is on the same destructive path as before!
    I would rather see GM North America and GM Holden Austrialia strenghten ties and develope new product for Asia and South America. Mark Reuss should be pounding on Dan Ackerson’s desk to strenghten ties with Holden. This is why Alan Mulally and his One Ford approach are able to develope the New Ford B-Max. I agree with you McElroy about the absent B-Pillar will get Ford back into the mini or micro van market.

    Isuzu is know only for cheap trucks like the Trooper. Boy did my friend drop a whole lot of money into his Isuzu Trooper to keep it alive.
    Maybe Joey Isuzu will become the new face of GM.

    I have a question for Peter DeLorenzo: What is with Honda and these stupid TV commerials? The Gulliver inspired Acura RDX TV Spot is bad too.
    I am really getting turned off to Honda! They must only still selling vehicles based upon their reputation. What do you thing?

    The Grey Dodge Dart in Seamus’s spot looked very much like a Honda Insight to me. I like the styling of that Dart. I hope it is roomy inside?

  4. Jim Thykeson Says:

    GM needs to learn from past experience; their relationship with Isuzu did not reveal any good things, why would you go there again?

  5. Kit Gerhart Says:

    I’d think that GM’s interest in Isuzu is mostly for medium duty trucks, and engines to power them. That is where Isuzu excels. The Isuzu diesel used in Chevy/GM pickups seems to work well.

  6. Kit Gerhart Says:

    Somehow, I’m not enamored with B-pillarless vans and other vehicles. It seems like an invitation to early problems with wind noise, etc.

  7. Cynthia Says:

    Dan Knott was, indeed, one of “the good guys”. He was also kind, caring, funny, a terrific engineer and a consummate gentleman with impeccable integrity. Those who were lucky enough to work with him will never forget him. Please keep his family in your thoughts and prayers.

  8. Jaret Says:

    I have to disagree. I would not rate the cruze as highly as you. I would say the focus is the class leader, but the cruze and elantra are on fairly even ground. Followed by the civic and corolla.

  9. pedro fernandez Says:

    John, in that last statement you made it clear that you’re biased toward US nameplates over the Asians, the reporter just said that the 2.0 with the auto was “sluggish” going up hills while the 1.4 stick was better, but Ill bet that over 80% of the models sold will have the 2.0 auto so does this mean that the standard engine is not good enough, the same cannot be said of the Elantra or the Civic, both base engines are quite capable on those models besides they have built a reputationfor quality and reliability while the Dart is far from proven.

  10. C-Tech Says:

    Hopefully GM can get it right with Isuzu this time. Hopefully this investment pays off in big trucks.
    The b-pillarless B-Max reminds me of the Dodge Hornet concept that Chrysler built years ago. If Ford does pull this off at a reasonable price, there may be a slice of the market which is receptive to it. There are still fans of the PT Cruiser, XB, Soul, and Cube who like the size and versatility of thees vehicles.
    As long as there are no major problems with the roll out of the Dart, Chrysler may have another sales success on there hands.

  11. HtG Says:

    Here’s an article from the UK Telegraph about the cars most likely to be crashed. Porsche wins!

    But who can guess which brand got second place? Hint. The drivers of these cars are scared to drive, and like to create long lines of people behind them, wondering what’s holding up traffic.


  12. RSharp Says:

    Four-door cars, vans and trucks without B-Pillars are not such a recent development. The late (and largely unlamented) Saturn SC Coupes from 2000 or so were pillar-less, as was the Mazda RX-8; so too the Honda Element and Chevy Silverado extended cab pickup truck. In the case of the RX-8 and Element, they are recent enough designs to have had to pass contemporary side-impact tests.

  13. pedro fernandez Says:

    I don’t care what they say, NOT having B pillars IMO is just not safe in a side collision, the doors themselves may have all the high strength steel you want but what is holding the door in place? a couple of hinges?

  14. Jon M. Says:

    @ #7 pedro

    Actually, John McElroy, in a recent AAH episode, gave a quick overall review of his first impression of the compacts. He did state that he knew some would think his opinion biased toward American brands, but it was to his own amazement that he just honestly felt the domestics were better. Still, I would agree with your point about the quality and reliability. I don’t care what the Civic or Corolla may or may not be lacking compared to the competition, they’re both still bullet proof cars that will long outlast their rivals.

  15. pedro fernandez Says:

    In the case of a subcompact or compact car where in order to get the best performance/mpg’s you have to spend more for a better/bigger/more moderns engine is a drawback for me, and I’m not talking transmissions, where convenience of auto vs better driving control of a manual is up to the buyer. On more expensive models, that is another story.

  16. Brett Says:

    About those missing B pillars: How, exactly, are the “jaws of life” supposed to cut through those new boron-steel high-strength structures to rescue the occupants after a bad crash?

    We are already encountering the law of unintended consequences in this area due to the Federal requirements for higher rollover protection.

  17. buzzerd Says:

    I think using the “reliability” argument to pick one car over another is very thin. Pretty much all the cars and trucks today have so little problems I don’t think you can go wrong. Statistically todays worst car is better than the best from 15yrs ago.

  18. Matt Says:

    Sad news about Dan Knott. I know he was highly respected & well-liked among the Chrysler Purchasing staff. He will be missed.

  19. pedro fernandez Says:

    #13 how about rollovers? are these magical doors supposed to keep passengers from getting crushed by the roof as well, or are they gonna put so many airbags that the car is gonna turn into a giant balloon in an accident? #14 Yeah, keep thinking that, specially the first year of most cars.

  20. Drew Says:

    Is Seamus McElroy related to Chumlee on Pawn Stars?

  21. Puremoose Says:

    B-pillarless vans and other vehicles are great for the disabled community.Easier to get in and out.

  22. pedro fernandez Says:

    And they can also add to the disabled community.

  23. Jerry H. Fluegge Says:

    Autoline Help!!

    I have done everything I can to avoid the halting sounds on Autoline with no success. I have reloaded Flash,Silverline, and Thunderbird and still the halting like slow downloads keep coming. Why does instant downloads from Netflix not do this? What can I do or my 8 year love affair with John and Autoline will end.


  24. HtG Says:

    Did you guys see that B-Max will have a 1.0 liter Ecoboost engine when it goes on sale in Europe this summer? Bring on the 9 dollar a gallon gas. Yeah, baby, yeah.

  25. HtG Says:

    23 You could try a different browser, if you haven’t already, JHF. I use Chrome, and it’s fine. If a new browser works, maybe reload your old one. (plus there goes all that nasty history and bookmarks!)

  26. Phoenix Mark Says:

    I don’t know how good (quality) the Cruz is, I do know that when I sat in one the seat bottom was as hard as a rock.

  27. cwolf Says:

    Ford screwed up the c-max for everyone by not planning an ICE in its first US offering,so I expect they will somehow also screw up the swell B-max as well. I bet tis lil’MPV will out sell the Fiesta and many others. I like it…esp. w/o the pillars! I really can invission so many purposes for this thing.

  28. cwolf Says:

    The Dart should do well. Based upon reports,it may be under powered at speeds over 55,but ample for most drivers. What is nice is the fact that it can be tailored to fit ones taste,as far as options. I’ve read the Darts interior,even in its basic form, should beat competitors hands down. For sure,this is a good one to follow.

  29. cwolf Says:

    Vetts are about the only car GM can export to Korea. Given the fact there is an unfair tariff and a limit of approx. 8000 units that can be sent there,I don’t see how this can be called “free trade!” Limit the Korean Hyundai/Kia to the same requirements is the only way I see a real “free trade” in both directions.

  30. cwolf Says:

    Oh,by the way; I predict this is the start of a sales decline,at least for average cars. Europe is in a turmoil,China is slowly hitting the skids and the Americas will feel their aftermath soon enough. The US should hold steady if the consumers keep spending to keep the economy active. Enjoy it while you can cuz a dip is around the corner!

  31. T. Bejma Says:

    I can tell you from first hand experience that the quality and reliability of GM cars and trucks is considerably better than it was just 5 years ago. When I started at GM, we were working on problems that were affecting 5-10 customers out of 1,000 on the high end, now it is rare that we have an issue that is even on 1 out of 1,000 vehicles. We now launch vehicles that have a 50% better quality rating (based on our internal inspection) than the vehicle it replaces. Gone are the days when you needed to worry about buying the first model year.

    I know that the only way to prove what I am saying is time, but internally at GM we already know. It is unfortunate that we damaged our reputation so bad with substandard quality and design, but you will see… just wait…

  32. NicksGarage Says:

    Did you forget the Nissan Axxess from 1990 (1990-95 in Canada). It had the same door arrangement with no pillar. I’m sure the new Ford is way better engineered than the Axxess.

  33. pedro fernandez Says:

    #31 we were referring to the Dart which is a mish-mash of Chrysler (bad) and Fiat (worse) so their little offspring may turn out to be quite a problem child, then maybe not, look at the 500, so far no massive recalls or troubling quality issues

  34. NicksGarage Says:

    Sorry, I got that wrong. It was the Nissan Stanza Wagon before the Axxess that had no b-pillar.

  35. HtG Says:

    I think the challenge is to have no B pillar when side impact standards are as high as they are today.

  36. Kit Gerhart Says:

    Usually, I just read the transcript, but I occasionally run the Autoline video. I’ve run it on an iMac, a Windows 7 netbook, and an HTC Android phone. All of them work ok.

  37. Kit Gerhart Says:

    The doors would need to be very strong, and the latches at the top and bottom would also need to be very strong. I think I’d rather have B pillars, both for safety, and for freedom from rattles and wind noise.

  38. Lex Says:

    Rethink the B Pillarless in the B-Max, There should be a minimalist internal B-Pillar which disappears from outside view when the driver / passenger doors and rear sliding doors meet. This would still allow for easy rear access to the rear passenger compartment of the vehicle. This would greatly improve structural integrity of the vehicle to increase survival of occupants from a broadside impact.