Episode 913 – Lexus Boosts Incentives, U.S. Fights Chinese Car Parts, Test Drive: Acura ILX

June 18th, 2012 at 11:10am

Runtime: 6:39

Lexus is gunning to reclaim the title of No. 1 luxury automaker in the U.S. and is boosting incentives to reach its goal. The Obama Administration is considering filing a World Trade Organization claim against what it sees as Chinese auto part dumping in the United States. Last week Hyundai announced pricing for the hatchback version of the Elantra, now pricing for the coupe is out. All that and more, plus a test drive of the all-new Acura ILX.

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Hello again and welcome to Autoline Daily. It’s Monday, June 18, 2012 – the start of another work week. I’m Rod Meloni, WDIV Local 4 News, Detroit filling in for John who should be back tomorrow. Anyway, here’s the latest news.

LEXUS BOOSTS INCENTIVES
Last week we reported Lexus is gunning to reclaim the title of No. 1 luxury automaker in the U.S. It lost the sales crown to BMW last year. New and refreshed product will be a big help, but that’s not the only weapon in the company’s arsenal. Bloomberg reports Lexus has increased incentives, and by quite a bit. Discounts on cars are up around 54 percent, while SUVs grew by about 60 percent. Spending is increasing at a greater rate than its rivals. Mercedes-Benz is up by 11 percent while BMW has increased its discounts by about 7 points. Still, this may not be enough. Even if the brand reaches its goal of selling 250,000 vehicles in the U.S. this year, BMW is gaining ground. So far its sales are up 14 percent this year.

FORD U.K. WORKERS ON 1 DAY STRIKE
Ford is facing a strike! No, the UAW is not causing trouble for the automaker; this time it’s the UK’s largest union, called Unite. According to the Detroit Free Press around 2,500 white-collar workers will voice their displeasure with the company’s decision to close a pension plan to new entrants, among other things. The 24-hour strike is expected to affect seven facilities across the country. Members of Unite are concerned Ford will expand pension and wage changes across the UK.

U.S. FIGHTS CHINESE CAR PARTS
The Obama Administration is considering a move against what it sees as Chinese auto-parts dumping in the United States. Reuters reports this morning the administration is seriously considering filing a World Trade Organization claim against China. The claim would decry a vast array of policies to give its auto parts producers an unfair trade advantage. The U.S. Steel industry first went to the administration earlier this year complaining about the flood of auto parts coming into the U.S. from China. Also, nearly 200 members of Congress, many from Midwest industrial states like Michigan and Ohio… that employ a lot of auto parts workers… appealed to President Obama to do something about the problem.

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NISSAN EXPECTS LEAF SALES TO DOUBLE
Some optimistic sales projections this morning for the new, all electric Nissan Leaf. Bloomberg is reporting Nissan’s North American Vice Chairman Bill Krueger expects to move 20,000 Leaves this year, which doubles last year’s number. Right now Nissan only builds the Leaf in Japan, but Krueger expects to start turning out “Leaves” in the United States by year’s end when its new plant in Smyrna, Tennessee goes online. Right now Nissan is only selling the Leaf in seven states, but once the new plant comes online it will begin national distribution. Leaf sales have dropped dramatically over the past couple of months while GM’s Plug in Volt has finally taken off tripling its sales in May.

HYUNDAI ELANTRA COUPE PRICING
Last week Hyundai announced pricing for the hatchback version of the Elantra, now pricing for the coupe is out. It starts at $18,220, including destination charges and is standard with features like heated front seats, SiriusXM Satellite Radio, Bluetooth, and remote keyless entry. Powering the Coupe is the same 1.8-liter four-cylinder that’s in the sedan. It can be mated to a six-speed manual or automatic transmission. The Elantra Coupe will arrive at dealerships later this month.

SAAR EXPECTED TO STAY STRONG (subscription required)
Despite the dip in last month’s SAAR, or Seasonally Adjusted Annual Rate, to 13.7 million units, WardsAuto is sticking with its forecast of a 14.5 million SAAR for 2012. Car sales in the U.S. should remain strong this year due to an improving economy and growing consumer confidence. Also, a number of new or redesigned models are coming out this year that could draw more people into the showroom.

Coming up next, John test drives Acura’s latest small-car offering.

2013 ACURA ILX
(The Acura ILX review is only available in the video version of today’s program.)

It will be interesting to see if the new ILX will help boost Acura’s sales and get this troubled luxury brand back on track.

And that’s it for today’s show. I’m Rod Meloni from WDIV Local 4 News, Detroit. Thanks for watching, John should be back tomorrow.

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

47 Comments to “Episode 913 – Lexus Boosts Incentives, U.S. Fights Chinese Car Parts, Test Drive: Acura ILX”

  1. Tony Gray Says:

    Man, I still have a real issue considering Lexus in the same breath as BMW. Every BMW, even the lower price point ones, are designed from the bottom up as luxury cars, not “gussied up” Toyotas.

    Near luxury, sure. Some of the higher end Lexus cars being real luxury? I guess. But counting their entire sales volume as luxury is rather dubious.

    And with the ILX…PUT YOUR SEAT BELT ON FIRST JOHN!

  2. HtG Says:

    Is it 20,000 Leaves or Leafs? Great minds would like to know. Loafs?

  3. Chuck Grenci Says:

    And speaking to Tony’s point(s); isn’t the ILX a gussied up Civic?

  4. Chuck Grenci Says:

    To HtG; I’m thinking (as a proper noun), it should be Leafs.

  5. HtG Says:

    Count ‘em, TWO local Nissan dealers want our Versa. One is offering 120% of ‘Book value,’ whatever that means. The other dealer put too many words on the paper for me to read it, but I’ve heard it before.

    BTW, I sold the Miata this weekend. The $,$$$ is in my bank, and the dude picks it up after he registers it.

  6. Lex Says:

    Why would anyone pay $25K+ for a Acura ILX when you can get a Honda Accord EX or EXL with premium options at that price?

  7. Kit Gerhart Says:

    BMW does a good job of making Americans think that all of their cars are “designed from the bottom up as luxury cars.” In the rest of the world, where you can buy most of them a lot less “loaded up” than what we get here, BMW’s fit into the market mix not that much above VW’s. In the UK, a “base” 3 Series sedan and a VW CC are about the same price. That is not the case in the U.S. Also, the base price of a 5 Series in the U.K. is only about 50% more than a base Passat, while in the U.S., the base 5 is 128% more expensive than a base Passat.

    As far as Lexus, they have one car, the LS, that is a serious luxury car, and it’s a very good one. Their biggest seller, though, the RX, is a big hit with real estate sales people.

  8. Kit Gerhart Says:

    #5,
    What are you going to replace the Miata with? If you’ve said, and I missed it, sorry.

  9. Kit Gerhart Says:

    #4,
    I’ve always called them Leaves, but I think I’ve been wrong, for the reason you state. Of course, I’m not sure of the proper plural of Prius, and I own one. I usually just use Prius as both the singular and plural, kind of like deer and fish.

  10. HtG Says:

    8 I won’t replace the Miata. I had my fun with it for a couple of years, and I’ve become frustrated with other people’s driving and street manners. The smartphones are getting all the attention from drivers and walkers alike. It’s no more fun out there, and I think will only get worse.

    The Civic will do fine.

  11. dcars Says:

    #7 that’s very interesting! I’ve looked at some of the lower end BMW models and wondered why they charge so much for them. They seam very plain to me.

  12. Tony Gray Says:

    Kit and dcars: I cannot argue with Kit’s comments, but likewise remember all those Mercedes taxi cabs we used to ride around in in Germany. I suppose this is a question that will never be answered as everybody’s definition of luxury is different. While I doubt anybody would say that a Rolls, or Bentley is anything but a luxury car, what about a Volvo, or a Buick? Does Lincoln or Caddy cross that line any more? A Genesis?

  13. RT Says:

    Is there a game-changing difference between the Acura TSX and ILX, besides a base starting price differential of five grand?

  14. HtG Says:

    Guess what, Kit! I’m going to be paying capital gains tax on the Miata! Whoopee! It turns out the only way to increase the cost basis is if you make an improvement to the car: No maintenance costs count. Check you IRS Schedule D! Whoopee!

  15. Kit Gerhart Says:

    10,
    What you say is sad, but true. It’s bad enough where I am, but I’m sure it’s even worse where you are.

  16. Kit Gerhart Says:

    All cars are getting more and more “luxurious” in vsrious ways. Quietness used to be a trait of luxury cars. Now, a Chevy Cruze is probably as quiet on the highway as a Rolls-Royce of not too many years ago. Also, new features start out on expensive cars, and then “trickle down”. My zero option 2010 Prius has “smart key” and automatic temperature. Ten or fifteen years ago, only “luxury” cars had auto temp control, and “smart key” probably didn’t exist.

  17. HtG Says:

    Maybe luxury has to do with how much a feature costs. Isn’t carpeting a luxury feature? Dating myself, I know.

  18. Kit Gerhart Says:

    I think carpeting was an extra cost option on my ’74 Duster.

  19. Kit Gerhart Says:

    It seems that some people will pay quite a bit extra for a “luxury brand.” To me, the Lexus ES is the best example of that.

  20. C-Tech Says:

    @ #16
    HtG I remember when power steering, power brakes, front disc brakes, and air conditioning were “luxury options”.

  21. C-Tech Says:

    To me it doesn’t have to be “built from the ground up” to qualify as a luxury car. If enough impovements and differentation in the interior and body are made, then it would qualify as a luxury car.

  22. HtG Says:

    I remember our cars with no power steering, but when you’re a kid it’s just a ‘fun’ feature. I learned about letting the car roll a little so the steering effort would lighten. There’s one skill no longer needed.

  23. RonE Says:

    One more “I remember.”

    I remember when my dad purchased a ’55 Chevy and the oil filter was an option.

  24. cwolf Says:

    For Lexus to increase its incentives over 50% should tell you there is more to it than regaining the number one spot. They also need to rid themselves of inventory. The Germans raised them a few points due to the European troubles. And the US averaged only 2% because our sales continue to flourish and our stuff has become pretty good and at a good price.

    Speaking of prices; $18+K for a c-class(?) anything seems rather foolish,if you consider there are so many better cars available a size larger for just a little more.

  25. Charles Domanski Says:

    I remember when an option on some American Motors cars, believe it or not, was a glove box door and sun visors. When I read that, I was shocked because all that and more was standard on all other cars. My how times have changed.

  26. cwolf Says:

    I have sympathy for the UK union strikers,but have to say,they better face the music and cherish the fact they have a job. Just as the UAW had to make concessions to help save the auto industry,several EU states will also have endure unwanted pains for the better of the whole. Better now than later for the Brits cuz it will,too, happen to the Germans once union contracts expire! All this financial wheeling and dealing we read about in the EU are just temporary patches. All peoples,except for the Polish,will have to soon accept the fact that wages,work hours and benifits will have to be renegotiated or suffer even greater losses from the global cometition.

  27. Earl Says:

    If Lexus wants to be #1 again they have to do some engine and transmission updating. The ES350 still has a 3.5 port injected engine at around 270 HP and a 6 speed automatic. And that’s going to be used in the 2013 too.
    Compare that to a Hyundai Genesis that has a 3.8L,333 HP and 8 speed trans. As for gas mileage the Hyundai they practically the same. The Genesis is more car and less money.

  28. cwolf Says:

    I know of several people who replaced their rotors with Chinese aftermarket brands. They saved a ton of money on the parts,but they usually lasted no longer than 6 months.

  29. Kit Gerhart Says:

    Lexus sales will go up, because there will be a mostly-new RX for 2013. There are people with spare money waiting for the new one.

  30. cwolf Says:

    My last input for the day:

    Several of you know I try to keep abreast of what transpires within the US auto industry,out of personel self-interest and a sense of job security in the future. Well… the Toyota possible 1M unit recall for window motor fires made something click in my head while piecing together a slew of tid-bits of rumors. Just for fun,let me predict,in the near future,we will see one or more of the Big3(2) re-purchasing once owned critical part plants that had been sold to a supplier. Why? To maintain the control and quality of vital parts,to reduce the risk of new technologies getting in the hands of others,and to invest in one-self rather than in the present volital market. I won’t state my reasons for this prediction,but let’s keep tract on how true it is.

  31. HtG Says:

    color me intrigued, cwolf.

  32. Jesse W. Henry Says:

    Wow how Honda has fallen… I was thinking Avenger before John even said it once the camera cropped the car to the B pillar. They are just not the same company they were 10 years ago.

    Honda with uninspired design and cheap plastics Toyota with huge incentives to keep the number one spot at all costs… It seems we have seen this song and dance before in the 80′s it just wasn’t from the Japanese.

  33. Kit Gerhart Says:

    #30,
    I don’t know if they wanted it that way, but GM now owns, again, part of what started out as Delco Radio Division, later Delco Electronics, and then spun off as part of Delphi in 1999. This current “arrangement” resulted after the bankruptcy of Delphi and GM.

  34. Kit Gerhart Says:

    #32,
    If I were buying a minivan, the Odyssey would be on my shopping list, but I can’t think of another Honda that I would even consider over its competitors. That was certainly not the case 15 years ago.

  35. MW Says:

    I noticed there was not mention of Cadillac when tget started talking about “luxury cars”. Is that saying something about the brand?

  36. MW Says:

    I noticed there was not mention of Cadillac when tget started talking about “luxury cars”. Is that saying something about the brand?

  37. Ed Says:

    I changed last year from Toyota to BMW , had been with Toyota since 92, don’t miss em, I do miss the Toyota of 1992 to 2000, they used to take care of you, I like the way BMW takes care of me now, it is all about the dealer. Ed

  38. Kit Gerhart Says:

    Cadillac probably hasn’t been part of the discussion, because they are not a recent top selling “luxury” brand like BMW.

    I certainly have liked the MINI dealer experience better than the Toyota dealer experience, but now that I have used my two years of “free” scheduled maintenance, I hope I don’t need to go back to either one.

  39. kevin m Says:

    SORRY ACURA I THINK YOU LOST ALOT OF YOUR MOJO . IF YOU BRING SOMETHING BACK LIKE A INTEGRA OR TSX TYPE SPORT COUPE . ACURA WOULD BE COOL AGAIN . BUT DOING THEE SAME OLD BORING SEDAN LIKE ILX ISN’T GOING TO WIN ALOT OF BUYERS OVER . TAKE THE HINT ACURA .

  40. Brett Says:

    They wouldn’t have power window fire issues if they only routed control-level current through the switches to drive relay/circuit breaker modules at the motors themselves.

    I do get tired of re-engineering automotive electrical circuits that have surpassed their obsolescence point.

  41. Brett Says:

    Has anybody seen on the road or know anybody who acquired one of those Hyundai Equus sedans? That’s ostensibly a luxury car, but there’s seldom any mention of it.

  42. Hondatrix Says:

    Whats up with the video? Keeps cutting at the Ford/Unite story? I’m watching it on Youtube now.

  43. Kit Gerhart Says:

    #41,
    I’ve seen one Equus on the road, that I noticed what it was. I don’t know anyone who has one, or has considered buying one.

  44. Kit Gerhart Says:

    The Equus is a luxury car by any definition, except brand name. C & D did a comparo of Equus and LS460 a while back, and the Hyundai won. OK, it won because of price, but still, it’s a much more serious luxury sedan than anything except the LS, and the expensive Europeans. See:

    http://www.caranddriver.com/comparisons/hyundai-equus-vs-lexus-ls460l-comparison-test

  45. C-Tech Says:

    The Equus may become the equivalent of the VW Phaeton.

  46. Kit Gerhart Says:

    The Equus has one big advantage over Phaeton, which is price.

    I hear that Phaeton may return to the U.S. market after a redesign for the 2015 model year. It has done better in China than in other markets. According to Left Lane News, 2011 sales were up 50% over 2010. It’s a car for wealthy people who don’t want to be as conspicuous as they would be in an S-Class.

  47. Brett Says:

    #43/44

    Thanks, Kit. I’ve seen none around here, but the Daytona area isn’t awash in high-zoot luxury vehicles.

    I used the term “ostensibly” because, while they’ve clearly targeted the vehicle as luxury, it’s really up to the market to classify the car by who does or does not purchase it.

    If luxury car buyers aren’t buying the Equus, is it a luxury car? :)