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Episode 1021 – Sandy’s Silver SAAR Lining, Apple’s Siri Debuts in Chevy, Fisker Hires Ewanick

November 27th, 2012 at 12:01pm

Runtime: 9:02

Amid all of the destruction and chaos caused by Superstorm Sandy, there may be a silver lining for the auto industry. Apple’s digital assistant Siri will be making its automotive debut in a couple of Chevrolet models. The abruptly ousted GM marketing chief, Joel Ewanick, has landed at Fisker, for now. All that and more, plus guest host Peter De Lorenzo has the High-Octane Truth about Volkswagen’s key to success.

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Hello and welcome to another episode of Autoline Daily. Today is Tuesday, the 27th of November and I’m Peter De Lorenzo, the Autoextremist, filling in John who is on his way to California to cover the LA Auto Show, but more on that later. Let’s get to the news.

HURRICANE SANDY HELPS SALES
Last month Hurricane Sandy put a dent in car sales but this month the storm is expected to have a positive effect on sales. According to WardsAuto, sales in November will hit 1.12 million units, for a SAAR of 15.2 million units, the highest since February 2008. The storm pushed back some purchases last month, plus thousands of vehicles that were destroyed need to be replaced. A new study from The National Insurance Crime Bureau estimates that 230,000 vehicles were destroyed because of the hurricane.

CHEVY SPARK EV REVEALED
Yesterday General Motors introduced a small EV in China, today the company revealed the electric version of the Chevy Spark in LA. GM didn’t announce its range but expects it to be among the best in its segment. The Spark EV will initially be sold in California and Oregon, as well as Canada, South Korea and other global markets. The car will be priced under $25,000 with tax incentives.

SIRI COMES TO CHEVY
And speaking of the Spark, starting next year it will integrate Apple’s voice-activated system Siri into the car. Customers who own compatible iPhones can use Siri through Chevy’s MyLink infotainment system. Drivers can do things like make voice-activated phone calls or play songs in iTunes. The new feature will also be offered with the certain models of the Chevy Sonic.

FISKER HIRES EWANICK
And speaking of General Motors, the former head of marketing at the company, Joel Ewanick, was just hired by Fisker. Ewanick will work on an interim basis as Fisker’s head of global sales while the company looks for a replacement for the retiring Richard Beattie. According to the Wall Street Journal, Ewanick was working with the company as a consultant and will continue that role while the company searches for a new head of global sales.

Hey, I want to remind you to tune into Autoline’s LIVE broadcast from the floor of the LA Auto Show tomorrow. John will be talking to top-level executives at the show like Adrian Hallmark from Jaguar Land Rover, Mark Reuss from GM, Tim Kuniskis from FIAT and many others. But you can get involved and send questions now! Submit your questions by clicking the link in today’s show notes or by visiting John’s Journal on Autoline.tv where you’ll see a full, up-to-date list of the guests slated to appear. And, make sure you tune in Wednesday at 4PM Eastern Time, 1PM Pacific for the LIVE show.

FIN DIESEL
Now it’s time for our continuing series of “Barn Finds,” all about some of the hidden automotive gems that you, our audience, send our way. Recently we got photos from viewer Eddy Mursuli, of his uncle’s 1957 Chevy 210. But, while this ’57 looks like a run-of-the-mill classic, there’s more than meets the eye. Under the hood you’ll find a 2.8-liter diesel engine, including the transmission and differential, from a Toyota campervan. Eddy tells us that the Chevy uses the stock fuel tank and gets around 42 MPG. Not sure we’ll ever hear that again. Thanks to Eddy for sending these pictures our way. And remember if you’ve got any pictures you want to share with us, send them to viewermail@autolinedetroit.tv. We’ll take videos too. Just upload them to your favorite video sharing service like YouTube, send us the link, and you just might see them on a future show.

Coming up next… The VW Group masters a classic formula: Product Desirability = Profitability.

I’ve written columns about cracking the code in the premium market before, and nothing ever changes, because it’s all about the product, always has been about the product and always will be about the product.

But though the parameters may not be wavering from that fundamental industry High-Octane Truth, how automakers are pursuing this quest for excellence is showing signs of unexpected boldness.

We only have to look as far as the VW Group to see how things are dramatically unfolding. The VW Group, led by the maniacal genius, Ferdinand Piech, is on an unbelievable roll right now. Wrangling such pivotal brands as Volkswagen, Audi, Bentley, Bugatti, Lamborghini and Porsche, to name a few, the VW Group is orchestrating the most successful array of brands the industry has seen since GM’s glory days.

Normally, it would be a recipe for disaster but somehow, someway the VW Group making it work.

The VW Group’s individual brands are allowed to run fairly autonomously, with individual design, engineering and product development functions tuned to the specific brands. And on top of that for the most part the VW Group seems to get the whole “image wrangling” thing, employing highly disciplined marketing positioning and advertising strategies. The result? The brands all have a distinctive identity in the market and are clearly defined to consumers.

Believe me, there are manufacturers with just one brand to worry about who can’t even come close to the brand differentiation going on in the VW Group.

But the kicker in all of this and the one thing that confounds and infuriates its competitors? The VW Group employs 520,000 workers. That’s more than GM, Ford and Fiat-Chrysler combined (plus another 82,000).
And, in the first six months of 2012 VW built 200,000 fewer vehicles than General Motors, and it needed 310,000 more people to build them.

“How can this possibly be?” you might ask. How can that level of inefficiency be rewarded with success in the market?”

Well, VW has posted $7.7 billion in profits to date this year, as compared to $4.6 billion for GM.

How do they do it? Well, maybe the car I’m driving this week – the 2013 Audi S7 – offers a glimpse at how the VW Group’s profitability is soaring. The Audi S7 shares the vehicle architecture with the A6 underneath, and then it is given the full zoot-suit treatment by the magicians at Audi.

The S7 is graced by elegantly swoopy fastback bodywork found in the A7 (concealing a hatchback), and it signals its presence on the road with an array of LED lighting that would warm the heart of any Hollywood production designer. Stuffed with a 420HP V8 and finished off with the usual exceptional Audi interior design and detailing, the S7 is indeed an impressive piece.

But let’s not forget it started out as an A6 underneath. The Audi A6, in case you’re wondering, starts out at an MSRP of $42,200. A regular A7 starts out at a price of $60,100 and the S7 starts out at a base price of $78,800. The S7 I’m testing this week comes in at a stunning $94,570, however, albeit with a boatload of options.

So if you’re wandering how the VW Group does it, the S7 is a graphic demonstration of how it’s done. But then again it’s still more than that, which brings us full circle.

You first have to have the product and that will never, ever, change.

Then you have to have the kind of brand image that is crystal clear to consumers, one unwavering in its execution and consistency. And if it’s dead-on – as Audi’s marriage of product and brand image is – then you’re able to create the fundamental desire for your product that will have people paying real money to acquire it.

It’s a classic industry formula – Product Desirability = Profitability – but one that Audi and the VW Group have spit-shined to perfection.

And that’s the High-Octane Truth for this week.

Well, that wraps up today’s episode. Once again I’m Peter De Lorenzo, the Autoextremist, thanks for watching and I’ll see you next time.

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

39 Comments to “Episode 1021 – Sandy’s Silver SAAR Lining, Apple’s Siri Debuts in Chevy, Fisker Hires Ewanick”

  1. Bradley Says:

    The new Passat is great, I just don’t know why they didn’t call it the CC. This would keep all Passats the same around the globe. If I understand correctly, the CC is the Passat the rest of the world sees.

  2. HtG Says:

    Wow, Peter. Every word

  3. HtG Says:

    Sandy

    Reuters has this piece(and one in the sidebar) about how Hurrrrricane Sandy disrupted the oil infrastructure in the northeast. You heard it here a couple of weeks ago.

    http://www.reuters.com/article/2012/11/27/us-storm-sandy-harbor-oil-idUSBRE8AQ0FP20121127

  4. Lex Says:

    This is fantastic news from Chevrolet: “Apple’s voice-activated system Siri into the car. Customers who own compatible iPhones can use Siri through Chevy’s MyLink infotainment system. Drivers can do things like make voice-activated phone calls or play songs in iTunes.”
    This is what I have been writing about for years. I believe this move will definitely attract many iPhone users to GM vehicles, so GM get busy and get it installed all your vehicles.

  5. JCG Says:

    I am very attracted to the VW Jetta and Passat as lower-cost alternatives to the Audi A4 and A6 respectively. VW has that highly proven 2.0T gas engine, the 2.0 TDI as an alternative to it, easily comprehensible navigation screens, and the DSG automatic transmission. Those are all very desirable technologies. But, VW has a very bad reputation for long-term quality which also lowers their car resale values. Consequently, I am always reluctant to actually buy one and tend to prefer the Japanese makes for their better reputations, generally speaking at least. Then, so many people seem to have a bad attitude about the VW dealer network for being too pricey in repair work, too. I wish I could feel good enough about VW to actually buy one of their cars!

  6. ColoradoKid Says:

    VW-Audi’s supposed phenomenal roll ;

    Hmmmn . Lets have a look see at the bottom line here ;

    Bugatti – Losing upwards of $500K per unit sold
    Lamborghini – Not a profit maker in the line up
    Bentley – Bentley’s Loses of late have been epic
    Audi – Depends . In the US ? Loser EU ? Barely holding its own . China ? Losing money hand over fist despite the popularity
    VW- About the same in most markets and somewhat worse in others as Audi

    That 7.7 Billion ‘ profit ? Not when you look a little closer at the costs incurred to reach those numbers .

    Simply put .. when the poop hits the fan and reality rears its ugly head it won’t be VW- Audi at the head of anyones class . Especially after factoring in VW-Audi’s Worldwide abysmal reliability record

    So why is VW-Audi making the numbers if not the ‘ profit ‘ you ask ? Because its become the ‘ Fashionista Car of Choice . Not because of anything VW-Audi has done right or wrong . They’ve simply slipped into the ‘ Trendy ‘ category of late . And as they slipped in – so shall they slip out .

  7. Lex Says:

    I really like that new feature on the new Ford Escape were you wave your foot under the rear bumper and the rear hatch door opens upward automatically. I believe this technology would also be great for minivan owners. If your arms are full and you need to open either the passenger or drivers side rear sliding doors just by waving of your foot under the door sill and it would open. This would be really great for parents with infants, young children and the seniors. Please send my royality checks in care of Autoline Daily, Thank you.

  8. ARHPG Says:

    Great job by Peter De Lorenzo on today’s episode #1021! Keeping humor to a minimum, De Lorenzo hit the mark on VW and its formula-for-success, describing clearly VW’s remarkable story of superb management in the automotive field. A very nice report.

  9. pedro fernandez Says:

    VW is making the same mistake that Ford made buying all those companies and almost losing their core business while they were at it. Furthermore allowing Lincoln to languish in the meantime.

  10. HtG Says:

    I’d like to see the new Fusion alongside an A7. I’ve been seeing A7s around for a while, and they are indeed classy. But 80+K? HS!

  11. ColoradoKid Says:

    So what ‘ Genius ‘ at GM came up with this ‘ brilliant ‘ strategy I wonder ?

    http://www.reuters.com/article/2012/11/27/us-gm-infotainment-idUSBRE8AQ02I20121127

    Hint to GM ; First you need to have the product . Then you actually have to have a few real geniuses on hand which from what I’ve seen lately from corporate right down to the sales floor GM does not have

    As far as the GM/Apple tie in I can promise you if it were possible Steve Jobs would be spinning in his grave faster than the rpm’s of an F1 car right now . He walked away from negotiations with Toyota specifically because their quality was not up to his standards . So considering the dreck that GM’s been foisting upon us of late my guess is he’d of laughed the GM negotiators right out of the room .

    Simply stated Apple needs GM like they need a hole in the head and had this come before the shareholders they’d of turned the proposal down flat . Fact is I’ll bet tying in with GM will only hurt Apple in the long run . Being in any relationship with GM is tantamount to being in a relationship with a Black Widow or a Praying Mantis . No matter how you slice it you’ll come up the loser . Shame on Tim Cook for this one !

  12. ColoradoKid Says:

    #9 I’ve seen the A7′s around as well . IMO they look exactly like what they are . Badge Engineered VW’s with a premium price tag and four nose rings in its snout ;-)

  13. HtG Says:

    11 I like the clean lines, wide stance, and minimal ornament. The interior brushed aluminum, I find a bit overstated, un-germanic. I’ll be happy to test drive one if anyone’s offering.

  14. pedro fernandez Says:

    Quick note on older drivers and technology, a couple of months ago, I saw an elderly lady driver trying to shift her new BMW 5 series into reverse by using the paddle shifters, ’nuff said!

  15. pedro fernandez Says:

    To add to the VW issue, they cannot move up the needle up in the quality ratings in the US market, makes you wonder where is all that great VW German engineering.

  16. Kit Gerhart Says:

    I just got back from taking a friend to have a cataract fixed, and while killing time, I went by a few car dealers, VW, BMW, and M-B/Audi/Porsche. I was driving my friend’s 2011 Fusion hybrid at the time which, BTW, drove pretty well.

    The biggest “sticker shock” I had was the BMW 1-series. All of them were over $40K, and one 335 coupe, not convertible, was almost $50K. That “base” $60K A7 seems like a bargain in comparison, not that I would buy any of these cars.

    VW had a TDI new new Beetle, and the interior looked pretty nice, with a little body color on the dash, but without the cartoonish look of the old new beetle. Overall, I liked what I saw at the VW place. The biggest thing they need to do, other than improving quality, is get rid of that 2.5 five cylinder used as standard engine in most of their cars. It is too thirsty for the power it makes, and doesn’t sound too great either. I’ve read that 2013 will be its last year, and a turbo four, probably 1.8 litre will replace it for 2014. They need to make that turbo work on regular gas, given the market it will be sold in.

  17. Kit Gerhart Says:

    It’s interesting that Chevy will initially have Ciri in their cheapest cars. Usually things like that trickle down, rather than up among car lines.

  18. ColoradoKid Says:

    A Sign that the End of the World ( as we know it ) is coming soon;

    ‘Automobile ‘ magazine voted the Tesla S ( a car they’ve yet to fully test drive ) as their 2012 COTY ( see the new cover )

    Each and every year the COTY’s from all the magazines , pundits etc become more and more meaningless by the minute

    VW-Audi loses BWTM ;

    Shame on me . I forgot to add in the illegitimate twins of Skoda and SEAT , both of which ( especially SEAT ) have been bleeding off VW-Audi’s cash at a ‘ phenomenal’ rate ;-)

  19. RonE Says:

    #18, Motor Trend also had Tesla as COTY.

  20. Kit Gerhart Says:

    #3,
    Interesting article. It sounds like the northeast was not very well prepared for Sandy, but with two storms in that area in two years, that will hopefully change for the better.

  21. Kit Gerhart Says:

    I, for one, like the Audi A7. It looks good, and is a hatchback, a rare combination in a car that big. Honda and BMW didn’t seem to do so well when they made a biggish hatch. Maybe those two should have kept their big hatches as cars, instead of bad car/SUV compromises.

    Unfortunately, the A7 is way too pricey, and thirsty for my tastes, but I think it looks pretty good.

  22. cwolf Says:

    Adding to Colorado’s reality boquet of the VW group; A lady from work stopped at a near by VW/Honda dealer to have the tires rotated and new brake pads installed on her Civic. She was startled to be told of a 3 day wait. She noticed the service area was full of VW’s,except for two Hondas. The service writter stated it has become rather normal. She said to be glad not to have purchased a Jetta.

  23. cwolf Says:

    The Spark EV may get a few extra looks after folks learn the car can reach an 80% charge on 240V in only 20 minutes. I wonder what effect this has on the battery memory if over use of the quick charge occurs?

  24. Kit Gerhart Says:

    #23,
    Lithium batteries, as used in the Spark EV don’t have “memory,” that’s a NiCad thing, but I would think the fast charge might shorten the life of the batteries, especially if they don’t keep them cool while charging.

  25. pedro fernandez Says:

    #22 Oh but they’re very reliable in the UK according to every forum I visit there, and when I state that in the US they suck, they start getting nasty, stating that us dumb Americans don’t know how to properly treat or maintain a car.

  26. Kit Gerhart Says:

    #25,
    It probably helps that they didn’t sell many New Beetles in the UK. They seem to be worse for reliability than other VW’s. The local non-dealer shop that works on VW’s in my home town in Indiana always has a bunch of them to work on, often for body hardware issues.

  27. pedro fernandez Says:

    I wonder also if it has to do with where they’re built and where the parts come from, even the Passat with the state of the art plant in Teen has had quality issues and I saw the video on that plant and it looks like they know what they’re doing, o On the subject of plants, I saw an old music video from the mid 60′s which took place in the Mustang assembly plant and they showed some workers painting the body panels by hand-held sprayers with zero protection against the fumes, those poor guys must have turned out to have real bad lungs after doing this for many years.

  28. Jesse W. Henry Says:

    #17 Kit Gerhart

    It is not that surprising to me. They are basically doing Fords original Sync rollout. The original Sync had a female voice allowed voice commands and i-pod integration and was launched initially on Focus and Fusion. The two cheapest cars they had at the time (but also the cars with the youngest most tech savvy demographic)

    I also have to agree with Colorado kid with the thought that this will help GM much more than it benefits Apple in any way… the best Apple can hope for is that it doesn’t hurt them reputation wise.

  29. Kit Gerhart Says:

    Yeah, it makes sense to have the SIRI rollout in Spark and Sonic. Those cars would have the youngest buyers, who would be most likely to want such things. This SIRI thing might be good in a Cadillac XTS, IF they had simple, intuitive controls for the radio and HVAC. The SIRI is for other things, like making phone calls and playing music stored on your iPhone, but you wouldn’t need to use it, just to drive the car.

    The sellers of expensive cars, bought by 80 year olds, are making a big mistake in having “high tech” stuff mandatory, like MyLincoln Touch and CUE. These people just want big knobs to tune and change the volume of the radio, and a couple big knobs and a few buttons to work the HVAC.

  30. C-Tech Says:

    John and staff, Given the loss of life,lively-hoods, and neighborhoods please stop referring to the “silver lining” of hurricane Sandy because people will need to replace their cars. A large number of people will be unable to replace their cars or trucks right away. If you lost your savings, furnishings, and the loss of work days while rebuilding, this will be a trying Holiday season. Besides, the storm may only pull forward sales that would have otherwise have happened later in 2013 and 2014.

  31. The Autoextremist Says:

    CORRECTION: Joel Ewanick has been consulting with Fisker and his “new” role isn’t really new. He will continue in his role as a consultant on an interim basis. Over and out. – PMD

  32. Roger T Says:

    After I watched today’s show, I have one word for those paying $90 grand for an S7: suckers.

  33. Kit Gerhart Says:

    #32,
    Yeah, you start seeing diminishing returns when you spend much more than $30K on a car. Some people just have a lot of spare money, and the spend it on A7′s, Escalades, etc.

  34. HtG Says:

    Imagine the arrivistes in China who pay huge fees on top of the purchase price: they’re enriching parasitic cadres that skim these monies. But yeah, 90K for a car? You’re stupid and we know it, capitalist slotnozzle

  35. Dave Foley Says:

    #6 I totally agree with you. Audi has found the formula for high margin sales. The delusion of many of it’s customers.

    Imagine how would Cadillac be treated if they took their new wonderful ATS and put a fastback roof on it – a bigger motor, and added $50k to the sticker!!! They’d be CRUCIFIED in the media!! But Audi does the same thing, and they get a pass. Audi = Flavour of the day.

    One thing no one ever accuses Audi of is lasting too long. In its own way, it is the epitome of today’s consumer society. Buy it. Look ‘cool’ owning it, but you’d better sell it before it gets too old.

    This same paradigm also applies to most BMW’s higher than a 3 series. No one has ever accused BMW of making cars that last too long either.

  36. Jim Taylor Says:

    Was in Phoenix on business Sun-today. Got a Passat as a rental car from Dollar- first time EVER I’ve seen a VW as such in my 30+ years of traveling. And there were LOTS more Jetta’s where mine came from, so VW is apparently going after big sales #’s via fleets, which can’t be very profitable.

    For a German car I found it rather passionless. Decent power, almost Honda smooth but…. just a car- sure didn’t make me want one, although it did get great mileage.

    One weird thing was the throttle tip-in. I remember a GF’s Pontiac Grand Am that had stupid sensative throttle response in the first 1″ of travel- it was impossible to start from a stop smoothly- bad news on ice/snow. This Jetta was the opposite- it had the most leisurely tip-in I’ve ever experienced on any vehicle. Maybe it’s designed to get better fuel mileage or to train future limo drives, but I thought it annoying- and it annoyed plenty of drivers in back of me who just passed me.

    No sale, sorry.

  37. Kit Gerhart Says:

    #36,
    Which was it, a Jetta or Passatt? You seem to indicate both. Also, what engine?

    I like “soft” throttle tip in, the better for driving smoothly, but I know people who don’t. I guess that’s why some cars give you a choice, including both my MINI and Prius.

  38. jmann Says:

    VW may be “on a roll” at present but it is amazing how fast things can change. I’ve been enjoying a 2009 Rabbit (Golf) for a few years now and, with miles accumulating, took a 2012 Golf for a spin considering possible trade. Wha’ hoppened! Not the same car – wide ratio transmission, noisy engine (mounts grounding?) – coarse, nasty. Chassis tuning degraded. TERRIBLE dash – flashy, cheap. Say what? So, what happened? Did the Rabbit guy retire? No longer a drivers car, they lost a customer. Chevy Sonic? Similar thing happened to Honda Civic in the 90s. The other thing with VW/Audi is the expensive maintenance. Only 36,000 miles/three years. So, I’m with Jim Taylor. What’s up?!

  39. Fritz Kocher Says:

    It just goes to show you that (VW’s success) concentrating all the “power” at the top is not a good thing overall or in the long run. I wish more companies would think this way. Can you say electronics, computers, phones…