AD #1273 – Chrysler Needs New Cars, AWD Sales Soar, Fast Cars = Better Chevrolet

December 9th, 2013 at 11:52am

Runtime: 6:38

- Chrysler Needs New Cars
- Fiat Spends Big On New Cars
- GM Cuts Korea Output
- AWD Sales Soar
- Fast Cars = Better Chevrolet
- Autoline Executive of the Year

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Welcome back to a brand new week of Autoline Daily. A lot is going on in the global automotive industry so let’s get to it.

CHRYSLER NEEDS NEW CARS
Looks like new car sales in North America will get off to a strong start next year. Wards Auto reports that automakers in the United States, Canada and Mexico will make over 4.2 million vehicles in the first three months of 2014. That means they’ll be making 68,345 cars and trucks every single work day. Interestingly, Chrysler is scheduled to increase production the most, up nearly 13%. But that comes on the truck side. Chrysler is expecting sales of its aging passenger car lineup to start declining. The company really needs to redesign the 200, Avenger, the 300, Charger and Challenger. Or else it’s in danger of becoming too heavily dependant on trucks again.

FIAT SPENDS BIG ON NEW CARS
Meanwhile, Chrysler’s parent company Fiat plans to invest a staggering $12 billion on new cars over the next three years. It will add more upscale models to the Maserati and Alfa Romeo lines as well as upscale variants of the 500 and Panda. But it will also drop one of its most popular models, the Punto for these more profitable models. Fiat believes it needs more high-margin models if it wants to to continue building cars in Italy.

GM CUTS KOREA OUTPUT
Last week GM decided to stop selling Chevy’s in Europe but the pain from that decision will be felt mostly in South Korea, which builds around 90% of all the Chevy’s sold in Europe. Bloomberg reports that production at GM’s plants in South Korea could be cut by as much as 20% by 2016 because of the pullout from Europe.

AWD SALES SOAR
According to data from the automotive research firm, Polk, the number of new vehicles sold with all-wheel or 4-wheel drive has increased 5% over the last 5 years. The new Jeep Cherokee alone has 3 different systems. Stunningly, almost one out of three new vehicles now sold in the US market can drive all 4 wheels. That’s largely thanks to the growth in crossover vehicles, which usually offer all-wheel and 4-wheel drive. Plus, today’s systems are far more fuel efficient than previous ones. Typically, you only lose about 1 mile per gallon on the EPA fuel economy rating.

FAST CARS=BETTER CHEVROLET
Last week I was out driving the new Chevrolet Corvette, the 2014 version of the Camaro and the SS. I had a blast driving them, but I also learned that these cars are part of the strategy of how Chevrolet plans to boost its brand image. First off, these cars don’t come cheap. Customers pay a pretty premium to buy them, and they don’t buy them in big volume. But that is exactly the strategy behind producing these cars: create sensational, low volume products, bring in new customers who would otherwise not come into a Chevrolet dealership, and make a lot of money in the process. These cars are the halos that are designed to make the Chevrolet brand a lot more aspirational. And GM executive Mark Reuss gets a lot of the credit for getting these kinds of cars in the Chevy lineup.

Say, who do you think is the one automotive executive who has stood out above all other this year? We’ll get into that right after this.

AUTOLINE EXECUTIVE OF THE YEAR
In two weeks time we’re going to announce the first recipient of the Autoline Executive of The Year Award. I’ve put together a blue ribbon panel of automotive experts and asked them to help me choose the one automotive executive, from any car company anywhere in the world, who stood out above all the others. So for the past two months we’ve been arguing and debating the strengths and weaknesses of a number of execs and today I’m going to start sharing with you who made our short list.

We start with Akio Toyoda, the CEO of Toyota, who has overseen an impressive turnaround at the company. You’ll remember that just a few years ago Toyota was embarrassed by headlines accusing its cars of runaway acceleration. It was hit by a record number of recalls and a slew of quality problems. Akio even had to publicly apologize to the US Congress.

But it was, in fact, those very problems that convinced the board of directors to move his predecessors aside and give the job to Akio. With him at the helm, Toyota quickly got back on track. Its sales and profits are growing strong and it will likely end the year as the world’s largest automaker.
We also like the fact that Akio is a true car guy, someone who would rather be out racing cars than grinding the day away in meetings at the office.

However, some Japanese observers believe that maybe Akio is a little too interested in driving fast cars and that the true credit for the turnaround at Toyota actually goes to the executives who are one layer below him.

Even so, its hard to argue with success. The turnaround at Toyota did not get going until shortly after Akio took over and that’s why he’s one on our short list for the Autoline Executive of the Year.

Tomorrow I’ll tell you about the next executive who’s on our short list, but I also welcome your ideas on who the Autoline Executive of the Year should be. Shoot us an email or leave a comment on our website.

But in the meantime, thanks for watching today’s show.

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

42 Comments to “AD #1273 – Chrysler Needs New Cars, AWD Sales Soar, Fast Cars = Better Chevrolet”

  1. Zieke Says:

    My choice for the ex. of the yr. is Alan Mulally of Ford, even tho I’m not a Ford person.

  2. Tony Gray Says:

    I like Chevy’s product line with a two seater, a four seater and a four door performance car. I still wish they had a Chevelle 2 Door RWD model. Perhaps with a newer, smaller, lighter Camaro based on the ATS platform there will be room for such a vehicle, with more than a vestigial rear seat. (Yeah, I had many large 2 door GM coupes including Chevelles, Celebrity Eurosport, Lumina and Monte Carlo as well as a GTO Hardtop…so I am biased)

  3. Dan Clemons Says:

    Alan, don’t even need to say his last name, is still my favorite #1 auto executive. He is Mr. Magic. I like Mr. Toyota too. He is a good car guy and he is also a Toyota.

  4. ColoradoKid Says:

    Choice of Auto Exec

    Subaru’s CEO … hands down . From the top .. to their advertising and marketing ( actually their marketing has been beyond brilliant ) … Subaru cam out of no where … and has blossomed while all others are in reality …. languishing

    —————-

    FIAT to spend $12 Billion …. yeah right …. that’ll help . For those kind of automotive dollars in the 2010′s …. $12 billion ought to get them another ten years of dreck based on the same crap they’ve been selling for over a decade

    IMO ? More Smoke & Mirrors from Marchionne in his feeble attempt to get an IPO for FIAT SpA … which …. NO ONE .. will give him … period !

    ——————-

    Chevy’s newest ” Fast Cars = Better Chevrolet ” tactic

    Uhhhhhh……… NOPE !

    First off Fords about to kick the Camaro’s tail end

    The C7 … though quick will be but a blip on the sales radar

    The SS … is a pathetic marketing ploy to dump remaining Holden stock … who’s sales are destined to plummet once the initial ‘ Wow ‘ factor falls to the wayside

    And anyway …. WHO IN THE SAM HILL NEEDS FASTER CHEVYS these days …….. especially when they’re all in reality … over priced … Decent .. to Mediocre … to Absolute Crap cars ( especially the Camaro ) underneath

    Try this one on for size Chevy ;

    QUALITY Cars will make for a Better Chevrolet .. not pretentious Speed claims y’all can’t even back up … and in fact have been proven liars about …. time and time again ;-)

    Nahhh…. Makes too much sense . And like Cadillac finally carving out its own niche rather than get its head handed to it time and time again by everyone from Audi – BMW – Mercedes .. and even the Japanese ..

    Making sense hasn’t been GM’s MO … for decades … and sales continue to prove ME right !!!!

    Ooops ! Whats that I hear ? Oh yeah . VW-Audi about to run over GM like a minor speed bump .

  5. G W Groovey Says:

    #4–Colorado, we know you HATE GM. Your venom adds nothing to the discussion here. If any other manufacturer were employee the same marketing or design plan they’re great…to you GM is just an also ran…ask me how I really feel!

  6. Bradley Says:

    IMO…

    Chevrolet’s build better, more content, higher margin cars is a step in the right direction.

    However, very few of these sales will be conquest sales. They will simply be increasing the profit line of a sale from an already loyal customer.

    To gain conquest sales, GM needs to do things like this under the Cadillac brand and improve dealership experience. Improve the experience by improving the basics of good customer service.

  7. Kit Gerhart Says:

    4,
    Yeah, Subaru has been very good at maintaining their 1.5% market share, and has some decent products, for those who want AWD.

  8. HtG Says:

    I’m an idiot. Ask me how I know

    I will now demonstrate to everyone how to to eat a hat. I just saw the Jeep Cherokee on a highway, and it looks smashing. I spotted it coming up behind me with it’s running lights on; you know it right off, the new Cherokee. Every pic I had seen and even the two on display at the NY show only put me off. But in white, on a rainy cold winter day, that Jeep works.

    No more reacting to media or indoor shows for HtG.

    Pass the Grey Poupon, that’s a fine looking hat.

  9. HtG Says:

    Mark Reuss

    I said it a few months ago, MR is building a stealth Pontiac division. Where’s the 130R, MR?

    When I teased the PS at the NY show that the SS was Mark Reuss’ car she smiled broadly and knowingly.

    Hey, who still has some left over hat?

  10. Kit Gerhart Says:

    How about Honda’s head guy for CEO of the year? After the disasterous new Civic a couple years ago, they quickly redid the interior, making it much better. Also, the new Accord came out pretty well.

  11. ColoradoKid Says:

    7 – So … just who else other than Subaru is dealing with NOT being able to keep up with demand … increasing ( not maintaining … read the stats Kit ) their market share … as well as spreading their market share into previously uncharted ( for Subaru ) territory

    NOT to mention … unlike your precious GM .. as well as all the other so called BIG Guns …. making a GENUINE profit as well

    Answer ? NOBODY

    Simply put … IF you comprehend Business 101 … just because you got a ton o’ market share [ because you've been around since the beginning of automotive time ] is no guarantee you’re either successful … or profitable … which in case you’ve missed the point … is the whole point OF Business …. P-R-O-F-I-T

    ——————

    HtG – 8 – That cans it … you’re most definitely off the X-Mas card list …. not to mention losing your seat on the Aesthetics Board …. yeeeeeesh …. Seriously ???

    Or .. please let this be so … you’re just being sarcastic ?

    [ if not ... tell me how ugly Franz is so I'll feel much better should I decide to keep him ;-) ]

    Ugh

    Bach is decomposing even more at the very mention of the thought ..

    ————–

    Bradley – 6 – You as well . Off you goes !!! . Sheesh ! Whats made you go Turncoat when it comes to GM of late ?

  12. ColoradoKid Says:

    HtG – 9 – And then … this …. You’d actually vote for an idiot who has in reality accomplished not one damn significant thing in his entire tenure ate GM .. other than to waste even more Tax Payers money … place GM on the precipice of losing its 2nd place … shoveling out more crap cars than even reasonable .. taking even more jobs overseas .. Not to mention backing up ( with Tax Payers funds ) ObamaClause’s current agenda to create a PanAsian version of NAFTA ?

    Is you done lost all semblance of common sense and reality ? Or do you just have a bunch of GM stock in your portfolio and in a desperate moment of Magical Thinking are hoping Saying it Will Make It So ?

    Or .. god forbid …. you’ve hooked up with Pinkman ?

    All’s I can say mein former freund is …. sumpins a gone wrong … very wrong indeed

  13. HtG Says:

    XxxxxxxxxxxxxXxxxxxxxXxxxxxxxxx

    You think you’re giving me grief, CK? I listen to Q2 out loud through loudspeakers. :)

    A moving car in natural light

    (But don’t you think I expected you to get torqued? Hey look at it as permission to take away Franz’ lunch money.)

  14. Kit Gerhart Says:

    11,
    I don’ t disagree that Subaru is doing very well, for a small, niche car company.

    I also, however, consider the building of broadly appealing cars to be part of running a car company, in addition to making big profit.

  15. ColoradoKid Says:

    12 .. cont .. and did I forget to mention in Mr Reuss’s long list of inglorious accomplishments … managing to increase HIS salary as well as bonuses and stock options while rapidly eroding the incomes of every Blue Collar Worker at GM .. along with their benefits … along with doing his damnedest to destroy the Unions once and for all ?

    Yeah … Mark Reuss … Dictator of the Year – Automotive Despot of the Year – Most Wasteful Automotive CEO of the year … maybe

    But the best ? Not unless your definition of BEST has suddenly taken a Post Modern 180 degree turn

  16. ColoradoKid Says:

    14 – In case you’ve not noticed …. GM aint exactly ‘ broadly ‘ appealing of late …anything but …. barely maintaining status quo and losing it quickly … ! LOSING market share NOT exactly being a good thing in anyone’s book !

    No Kit …. you reward people for genuine bonafide Success … at any level … not for taking a company down another notch on the US as well as World Stage

  17. HtG Says:

    I wasn’t saying M Reuss was exec of the year; merely commenting on SS and the performance cars at Chevy.

    I truly have no idea about best auto exec. I do however have opinions about Redskins owner Dan Snyder. Boy is that a piece of work.

  18. Bradley Says:

    #11

    I was trying to gloss over the headline Chevrolet, an American brand, but when sold in Europe 90% came from Korea.

    Yes, that sounds very global and new world…but its what you get when the home baked cookies are filled with High-Fructose Corn Syrup and Hydrogenation.

  19. ColoradoKid Says:

    13 – Oh well … as the song says ;

    http://www.youtube.com/watch?v=CWsJcg-g1pg

    FYI – Heck … Q2′s downright tame in comparison to what I’ve been reminiscing over …. my Phi Beta Zappa ( freak yer Greek baby ) days … including ” Yellow Shark ”

    Toddles

  20. ColoradoKid Says:

    18 – Mea culpa … that’n slipped right on by me

  21. ColoradoKid Says:

    18 – And if ObamaClaus , GM et al get their way with that PanAsian NAFTA …. its only gonna get a hell of a lot worse

    Can you say …. Made in Viet Nam Corvette ? Made in Thailand Silverado ? Made in China Colorado ?

  22. pedro fernandez Says:

    Looking at this past weekend’s weather all over the country, except So Cal and So Fl you realize why so many people are looking at Subaru, even though when it ices over, no AWD, no ABS no traction control is gonna do much for you if the other guy comes crashing into you!

  23. T. Bejma Says:

    #9

    Totally agree with you HtG, you can bet MR never gave his vote to axing Pontiac.

    He is the guy you want in Design or Marketing for us Car Guys, however, if he were to run the whole show, we wouldn’t be making the money we are now.

    It’s a tough balancing act in this business, heck, even Subaru has all but given up the Rally heritage on it’s Driver’s car, the WRX STi, to focus on more mainstream, safe (from a design perspective) vehicles. Have you seen the STi lately? 2008 called and it wants it’s car back…

  24. T. Bejma Says:

    #16

    GM NOT losing share…

    GM Market Share through November 2012 = 17.9%
    GM Market Share through November 2013 = 17.9%

    GM Market Share for the month of Nov 2012 = 16.3% (when there was much higher incentives)
    GM Market Share for the month of Nov 2013 = 17.0% (another month of record ATP’s as well)

    At least according to the Wall St. Journal…
    http://wap.wsj.com/mdc/public/page/2_3022-autosales.html

  25. HtG Says:

    Off topic, but sad

    Here’s a link to news that a cyclist in a bike lane was killed by a police cruiser, while the officer wasn’t really doing much. It’s not possible for me not to ask about texting. It may be too dangerous to ride these days.

    http://www.webpronews.com/former-napster-coo-milton-olin-jr-dies-after-being-hit-by-police-car-2013-12

  26. T. Bejma Says:

    #25

    The police are not just texting, but typing on a LAPTOP!

  27. HtG Says:

    I’ve seen someone have to swerve around a texting cop that over ran a ‘stop’ line. Smartphones aren’t going away, and autonomy might be the solution. Normal Peeps just need to communicate much more than attend to driving.

  28. Chuck Grenci Says:

    Nice review of the new Corvette convertible by Autoweek; pretty much like it (though with a removable roof panel, they say, only the purists would need to want a Vette convertible). And I finally got to see one (a C7) in person and it looks real good (to me).

  29. pedro fernandez Says:

    many police depts are dispatching units by using those on-board laptops instead of radio calls, this means the lone cop has to take his eyes off the road so he can read the text and look up the address as well, all this while speeding to the call, this is so damn dangerous and I don’t see anyone making a big stink about it cause it’s the cops and anything goes. I know of one who was able to sell his car cause he got a take home cruiser and he is “encouraged” to take it with him wherever he goes to give the “appearance” that there are more cops on patrol than there really are.

  30. pedro fernandez Says:

    To John: is there anyway you can check regional sales for any particular make/model? I see at least half a dozen new Corollas every time I make my rounds and they’re all over the place, so it’s not the same ones over and over. I would like to know how many of these Toyota is selling in So Fl.

  31. Kit Gerhart Says:

    16,
    CK, to me, if a car company has 17+% market share like GM, their products must have broad appeal. If a company has 2%, like Subaru, they don’t have such broad appeal, and serve a niche.

    Yes, as I’ve said before, Subaru does very well at serving their niche.

  32. pedro fernandez Says:

    #31 precisely, around here I see hundreds of compacts, rarely do I see any Imprezas, as few as Mitsu. Lancers. Ditto for Legacy and the Crosstrek, these are just not warm weather vehicles at all.

  33. HtG Says:

    I’m giving Akio T kudos for making the Toyota brands more expressive and interesting. Also, competing in WEC with Audi and Porsche raises all boats.

    The eagle has squawked.

    (But about that Snyder….)

  34. dcars Says:

    My choice for Autoline’s exec. of the year Jim Hall…..
    GM should have used the Halo car plan for Europe instead of selling cheap crappy cars first.

  35. T. Bejma Says:

    My choice for Auto Exec – Bob Lutz. He has been responsible for changes at so many major automakers and you have to credit him for allowing the designers at GM to overrule the bean counters.

  36. dcars Says:

    Ok my real choice for executive of the year Sergio Marchionne! Just kidding I’d pick Jim Hall over Sergio anytime.

  37. dcars Says:

    On that same note, where is Fiat getting the money for it’s rebirth? I’m betting it’s Chrysler.

  38. cwolf Says:

    I think I know where Fiat may be getting the 12 billion investment money and it’s not from Chry.! The TV ad depicting hoards of Fiats traveling under the ocean to reach US shores gave the Columbian cartel an idea of substituting home made submarines for a fleet of 500L’s. In return Fiat will get an unspecified %. This has to have some truth to it because my sources are the same ones as CK’s. :>))

  39. cwolf Says:

    Most already knew:

    http://www.autonews.com/article/20131209/OEM/131209870/study-gm-chrysler-bailouts-generated-8-to-1-savings#

    Now one has to ask when will the German gov’t stop funding their auto industry with taxpayer cash?…and the Asians?

  40. HtG Says:

    39 lalalalalalalalalalalalala!!!!!!!!

    We refuse to hear

  41. ColoradoKid Says:

    38 – Trust me … its a rouse … thay aint no $12 billion

    ————

    GM’s most recent cynical attempt at image boosting

    Hiring Mary Barra as CEO … Yeah … that’ll work out real well

    Any bets the Board will run rough shod over her … even worse than they did Akerson … making her look like a minor speed
    bump on the pit lane exit of a high speed race track ?

    Pretentious Politically Correct and Pathetic sums it up in a nutshell

    ————–

    39 – The article .. what a total complete and utter propaganda based crock of manure !

    Yeah … it saved us alright . Saved us from finally getting rid of two complete parasites on the US tax payers backs for decades that’ll be begging at the door again for alms to once again to bail the two of them out ……

    Five years or less … any takers ?

    Thought not ;-)

  42. ColoradoKid Says:

    39 – Cont …. Bet me they ( Germany especially ) cut the funds ( especially for the likes of OPEL ) sooner that you might think …