AD #1132 – Brazil Drops Safety Ball, GM May Advertise Inside Cars, Wild New Lambo Concept

May 13th, 2013 at 11:59am

Runtime: 7:56

While traffic fatalities in the U.S. have fallen 40 percent in the last decade, they leaped by 72 percent in Brazil. GM sees an opportunity to start selling advertising in the car, as internet access becomes more available. At its private 50th birthday party, Lamborghini pulls the wraps off a very futuristic looking concept. All that and more, plus host John McElroy responds to your comments and questions in this week’s edition of You Said It!

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Welcome to a brand new week of Autoline Daily. Later on in the show we’ll have your comments in You Said It! but now let’s get to the news.

EURO CAR INDUSTRY NEEDS TO SHRINK
Frank Stronach, the founder of the giant supplier company Magna, is saying what everyone knows is true, but nobody wants to hear. He says the European auto industry has too many car companies and too many factories. Despite facing millions of units of overcapacity, European automakers have been slow to close plants, under enormous pressure from governments and unions to keep them open. Here’s my Autoline Insight. The longer it takes to deal with the overcapacity issue, the weaker the European industry becomes, opening the door for Asian automakers, including the Chinese, to come in and capture market share.

BRAZILIAN CARS CRITICIZED
A big story by the Associated Press excoriates Brazilian-made cars for being built to substandard safety standards. While traffic fatalities in the U.S. have fallen 40 percent in the last decade, they leaped by 72 percent in Brazil. The problem is a lack of safety standards. Brazil’s first mandate for airbags only starts next year, a quarter of a century after they were mandated in the U.S. But meeting crash standards involves a lot more than airbags. Vehicle structures need to be beefed up considerably, which adds weight and cost. And therein lies the problem. This is not an issue only with Brazil. It’s a problem facing every emerging market. They don’t want to drive up costs for the auto industry or car buyers, and so they live with higher fatality rates. But the day of reckoning is coming, and the industry would be smart to get out in front of it before it has a public relations disaster on its hands.

GM MAY ADVERTISE INSIDE ITS CARS
Starting next year, GM will offer internet access in some of its vehicles to allow passengers in the back seat to stream videos to watch. But GM CEO Dan Akerson also sees this as an opportunity to start selling advertising in the car. For example, the logo that shows on your screen at start-up could say “brought to you by Allstate” But what we want to know is, what is the benefit to the consumer? Unless there’s something in it for the car buyer I think they’re going to find this idea revolting.

TESLA’S STOCK JUMPS
Last week we reported that Tesla posted its first ever quarterly profit and thanks to investors it’s also been good news for CEO Elon Musk’s bank account. Bloomberg reports that Tesla’s stock jumped 11 percent after its earning were released and closed at a record $76.76. Elon Musk’s net worth is now $4.5 billion, thanks to Tesla and his solar power company.

PEUGEOT’S HOT NEW HATCH
Peugeot is showing off its new 308 hatchback. The car features a new modular platform that shaved 140 kilograms or 308 pounds in weight, now boasts front and rear LED lighting and a refined interior. It is built at the company’s Sochaux plant in France and goes on sale autumn of this year in Europe.

LAMBO CELEBRATES 50 IN STYLE
At its private 50th birthday party, Lamborghini pulled the wraps off a very futuristic looking concept, called the Egoista. The car is powered by a 600 horsepower V10 engine, uses an push button dome for access to its single seat and the cockpit is made up of carbon fiber and aluminum. It can also be ejected from the rest of the car in case of an emergency. The styling is said to be inspired by a Apache Helicopter. We’re sure if this concept does ever hit the streets it will carry a price tag as outlandish as its styling.

Coming up next, it’s time for You said It!

M360 asks, “John – Why does Ford outsell GM in trucks year after year?” I’m tempted to says it’s because Ford understands its customer better and does a much better job of advertising. But it’s also because GM splits its effort between two trucks, the Silverado and the Sierra. Add those two together and they almost catch the F-series. Almost.

cwolf wants to know, “Why does it cost $1.3 B to build a GM plant in China when labor and land cost is almost non-existent and material prices are nothing like we know?” Because it doesn’t cost GM $1.3 billion to build a plant in China. Whenever a car company, any car company, announces what it’s spending to build a new plant, take it with a grain of salt. They throw everything and the kitchen sink into that number. It also includes the product development costs for whatever vehicles that plant will build. Automakers love to make their investment number look as big as it can possibly be to impress the politicians who gave them all those subsidies to build it in their district.

Cozy saw our report of the notches in the back bumper of the new Silverado to use as a step up to the bed. He says, “Geez, my friend’s 8 year old Chevy Avalanche has holes in the bumper to step up.” Yep, that’s where they got the idea for it.

Mrchevy baja wonders why Chevy would come up with a high-end version of the Silverado when it has the GMC Sierra to fulfill that role. “Here we go again, GM competing against itself. High Country vs Denali.” What Chevrolet found is that it has plenty of customers who are willing to pay $50,000 for a pickup truck, and that it was leaving too much money on the table. They had big arguments inside GM if this was the right way to go, but all that potential profit was just too much to ignore.

GHOSTJERKER has definitely identified one of the most promising markets for cars that can drive themselves. “My 90 year old grandmother would love a fully autonomous car. She has finally admitted that she can not physically drive anymore and she is now driven by family and friends to her errands. She misses her independence to come and go as she pleases.” That’s right, and there are millions of older drives like her, and that’s why I think there will be a big market for autonomous cars.

TCB1468 wants to know, “Does the Elio meet US safety standards? Or is it not considered a car? Surprised it is only $6,800.” Since the Elio is a three-wheel car, it is officially classified as a motorcycle, and so it does not have to meet any crash standards, which is a good thing since it couldn’t meet them.

And that’s it for today’s show, thanks for watching and please join us again tomorrow.

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32 Comments to “AD #1132 – Brazil Drops Safety Ball, GM May Advertise Inside Cars, Wild New Lambo Concept”

  1. Bradley Says:

    GM’s comments about adding ads to a car’s info-tainment system is disappointing.

    The execs truly are trying to manage a cash machine and not an automaker.

    I loved the “Step Here” sign on the Lambo. I found it amusing as “No Step” is typically the only signs you see on an aircraft.

  2. Kit Gerhart Says:

    If GM can lower the cost of the data service for their in-car internet with their advertising, and convince customers that is happening, it should be ok. Otherwise, it sounds like very bad PR.

  3. T. Bejma Says:

    “But it’s also because GM splits its effort between two trucks, the Silverado and the Sierra. Add those two together and they almost catch the F-series. Almost.”

    Hey John, if you just look at the F150 vs. the GM 1/2 Ton Models (which is a large majority of the sales) GM wins the sales war by about 50K units last year. Ford likes to include all of their trucks that start with an “F” (F250, F350, F450, etc.) in the F “Series” numbers…

  4. T. Bejma Says:

    Hey Kit – Looks like I am going to be in your neck of the woods at the end of June. Staying in New Smyrna and taking the family to the Disney/Universal/SeaWorld/etc. Resorts. Perhaps I can escape for a few hours and we can catch a beer?

  5. James T Says:

    I will never buy any car that has advertising built into its info system. You can’t even get a news story on the internet anymore without having to sit through some crap advertising. Things have gotten way out of hand.

  6. Brett Says:

    I’m in South Daytona, T & Kit. Anybody like folk and acoustic music?

    http://www.brettcammack.com

  7. C-Tech Says:

    Well Mr. Ackerson if selling internet advertising inside the car is a good idea, then an even better idea is to offer lower lease or car payments if buyers offer to wrap the entire car in advertising (or at least the tailgate/liftgate on a pickup truck or suv!).

    The designers at Lambo might want to look at a muscular athlete or a beautiful woman the next time they design a car. The Dyson vacuum cleaner looks better than that.

  8. Kit Gerhart Says:

    The Tesla Model S outsold the expensive Germans the first 3 months of 2013, and other tidbits from AW:

    http://www.autoweek.com/article/20130513/CARNEWS/130519937?utm_source=DailyDrive20130513&utm_medium=enewsletter&utm_term=image1&utm_content=20130513-Tesla-Model-S-outsells-luxury-competition&utm_campaign=awdailydrive

  9. David Britton Says:

    I take the Dealer stickers off first thing when I buy a Auto, why would I want advertising in my new car,will they give me the car like Red Bull does? Stupid idea.

  10. Kit Gerhart Says:

    4,
    I’d like to, but will be in Indiana for the summer at that time. Have fun on your vacation.

  11. Kit Gerhart Says:

    I wouldn’t want my car “wrapped” with advertising, unless someone paid my a lot for their advertising. I’d drive a 911 with advertising, if they’d let me drive the car for free.

  12. Chuck Grenci Says:

    When you get into your vehicle, all systems electronic, need to go to their designed function as soon as possible; no advertisements (thank you very much).

  13. ColoradoKid Says:

    Hmmmn . Lets see now . TESLA’s lying about their profits……AW trying to claim how many TESLA S’s have been sold ( despite the fact that TESLA is no longer ‘ officially releasing sales or pre order numbers ) …..Kits German ‘ envy’ shining thru as always ……. GM’s feeling the need to now stick advertising into each and every aspect of any poor fool willing to buy one’s life …. AudiGhini’s come out with yet another ludicrous concept … Brazils cars are crap … PSA’s ‘ Hot Hatch ‘ that from all early reports is in fact luke warm at best …. ………. and ….. T Bejma’s still shilling for GM by passing on an ever constant stream of GM propaganda in a vain attempt to show GM’s trucks are in any way competitive with the Ford F series

    Yep !

    SNAFU as expected . . Oh well . Thought I’d peak in and see just in case . Decision stands …

  14. Thomas A Cerbo Says:

    Why all of sudden am I having difficulty viewing AUTOINE.TV ?

    Never have before.
    Tom Cerbo

  15. Thomas A Cerbo Says:

    Why all of a sunden am I having difficulty viewing Autoline.TV ?

  16. Kit Gerhart Says:

    13, CK says: “Kits German ‘ envy’ shining thru as always ……. ”

    What, exactly, are you talking about? I just summarized the headline of an AW article, and then posted the link that article.

    Yes, I think you need to go away, permanently, if you can’t come back briefly without being nasty to others who post here.

  17. G.A.Branigan Says:

    Another black mark for gm.I will buy add-on stuff like a nav system sans ANY advertisements save for the Garmin name coming on when switching on the power,just as good,maybe better and easier to use too,dumbasses (gm).

    @ CK: I wish toyota had a truck I want,but they just don’t.Maybe in the future.Nissan on the other hand interests me.Let’s see where they go with the new Cummins I4 diesel 4×4.

    This is why I haven’t been ‘brand loyal’ since my ford days when I was a kid.If one oem doesn’t have what I want my mind is open enough to look at viable alternatives from other oems.

  18. Kit Gerhart Says:

    There seems to be a lot of “brand silliness” in cars, especially with sound systems. The car radios carrying the names Infinity, Bose, Harmon-Kardon, and the rest, have nothing to do with what those companies are known for, or used to be known for. Then, there are the “special editions” named after underwear brands, or whatever. Isn’t there a Calvin Klein Ford Expedition? OK, it’s probably something else, but just as silly.

  19. T. Bejma Says:

    What’s in it for the consumer, you ask John (re: In Car Advertising)?

    How about FREE In Car Wireless!!! If I can stream Internet Radio, the kids can stream Video to their tablets and I could even access FREE Navigation and Real Time traffic for looking at an ad or two at startup, I’M IN!!!

  20. Kit Gerhart Says:

    Yeah, if advertising can make services free, or even substantially cheaper, it’s a fair tradeoff.

    The thing that annoys me is cable and satellite TV, where you pay a lot of money, and still have lots of ads. When in Indiana during the summer, I just use over-the-air TV. I’m in a small minority, though, and I hope there are enough of us that the broadcast stations keep their transmitters running.

  21. pedro fernandez Says:

    Since my descent into poverty, I have discovered the wonderful world of digital, off-air TV, a bunch of locals transmit secondary channels which include older TV show from my era and even music videos. FREE all I needed was to hook up an abandoned roof antenna and a second hand receiver I got on ebay and voila, bunch of channels, not available on cable. or sat. Someday I expect to find a tv screen showing commercials for Preparation H or Charmin as I sit in a public john for some unscheduled relief.

  22. Kit Gerhart Says:

    13, “PSA’s ‘ Hot Hatch ‘ that from all early reports is in fact luke warm at best …. ”

    Huh, the pictures of the new 308 were first revealed today. There won’t be any “early reports,” good or bad, on how it drives, for weeks or months.

  23. Kit Gerhart Says:

    21, It sounds like your urban area has a lot more over-the-air TV than my area, away from large cities. Still, I get the major networks from Indianapolis,50 miles away, and a few other, lower power stations from from closer towns.

  24. cwolf Says:

    Let’s be honest, here. The difference between GM and Ford truck sales is like worrying over spilt milk!
    T.B., you can take all those freebee’s you mensioned and put them where the sun don’t shine. Any advertisments in an auto is the most absolute rediculous BS to pull on a buyer! You’re wiser than that garbage!

  25. C-Tech Says:

    On a philosophical level I believe GM engineering should put all of its efforts into building better vehicles. I believe the GM marketing, business operations, and sales should put all their efforts into being creative, streamlining red tape, improving employee relations, and making the dealership experience better (or eliminating dealers and selling direct). Requiring ads in cars in exchange for free streaming I just don’t think fits the objectives. If I am an advertiser, I don’t want to put my ad where consumers don’t view it favorably. If there are not enough takers over time, GM will have to foot the difference between cost and revenue (Remember OnStar ?).

  26. gary susie Says:

    I don’t think the automous car sales will be big, I think they will be huge and the one who does it first looks to make a pile of money.

  27. T. Bejma Says:

    I can assure you C-Tech, every Engineer I deal with is trying to make the best vehicles. I also believe it is showing, not in propaganda as CK likes to say, but in quality survey’s, lack of recalls and employee morale that I deal with every day. The dealership experience will always be a difficult thing to change since they are not on the GM payroll and with differing franchise laws from state to state, but believe me, we know it is an issue. I can say that I had a great experience with each of the 5 dealerships I dealt with, trying to find the exact options, before buying my Cruze, so hopefully that is a sign of some improvement.

    Here is an encouraging article about the (shrinking) quality gap between the domestics and everyone else…

    http://www.bloomberg.com/news/2013-05-13/gm-ford-chrysler-win-most-categories-in-quality-survey.html

  28. dcars Says:

    Gmc/chevy means more sales? Ok GM bring back Pontiac!

  29. C-Tech Says:

    @ #27 As I tech, I see GM vehicles getting better (still don’t like the Traverse and Captiva quality is lacking). I understand the problems with dragging franchise owners into the 21st century). Everyone else is getting better too. I just believe this should not be a priority and if I were the CEO of GM this is not part of the announcement I am making. Keep the faith T.B., keep the faith.

  30. pedro fernandez Says:

    #27 this is NEW cars, but what about 3, 4, 5 yrs from now? past statistics have shown only the Japanese have remained reliable, most US and EU models have not fared so well, there are exceptions of course,(trucks,Panthers, certain full size GM stuff)

  31. Kit Gerhart Says:

    I see a surprising number of ratty looking, but running 80′s “A” cars and front-drive “C” cars around here. Maybe the “A”s are mostly the ones with the 3800 engines.

  32. Kate McLeod Says:

    Thank you for using the word “revolting” regarding in car advertising. GM better offer a way to turn that off or they’ll see defections. Of course, someone at GM once had the brilliant idea of putting Buick ads on those hateful rations of peanuts thrown at you by stewardesses on airplanes. So why should we be surprised.

    I feel the same way about advertising in movie theatres. You pay $15 bucks to see a movie and then some company throws an ad at you.