AD #1546 – Recalls Hurt Honda’s Bottom Line, Bashing the Ford F-150, Nissan Juke Nismo RSnow
January 30th, 2015 at 11:53am
Runtime: 7:30
- Recalls Hurt Honda’s Bottom Line
- Kia Slashes K900 Pricing
- Toyota Tests New Semiconductors
- Bashing the New Ford F-150
- Nissan Juke Nismo RSnow
- Will Cheap Gas Impact Car Sales?
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On today’s show…Nissan comes out with the ultimate snow machine, Honda’s recalls hurt its bottom line, and how cheap gas prices could affect car sales. All that and more coming right up on Autoline Daily.
This is Autoline Daily for January 30th, 2015.
RECALLS HURT HONDA’S BOTTOM LINE
Honda has set aside millions of dollars to deal with all the recalls related to Takata’s defective airbags and now it’s catching up to its bottom line. The company released its financial results for its most recent quarter and they’re not too good. Sales came in at just over 1 million units which is a 5% drop compared to the previous year. Its total revenue fell just shy of $29 billion dollars, a gain of 9%. However its net income fell by 15%, coming in at $1.2 billion dollars. And because of all the recalls the company lowered its sales and revenue forecasts for the fiscal year.
KIA SLASHES K900 PRICING
When Kia introduced its new luxury vehicle last year, the K900, many people wondered who would pay $60,000 for a Kia. Well not too many apparently. The company sold just 1,300 in the U.S. last year. And because of that Motor Authority reports Kia is slashing the starting price of the luxury car by $5,000. It will now carry a price tag of $55,400 but it won’t come standard with LED headlights, chrome trim, Nappa leather and a 17 speaker audio system.
TOYOTA TESTS NEW SEMICONDUCTORS
Electrified vehicles may have enough juice to cover most people’s daily commute, but range anxiety is still a major reason why they don’t sell in large numbers and Toyota is looking to change that. The automaker is testing out a new type of power semiconductor that uses silicon carbide. Power semiconductors are found in power control units, which control the use of electricity to the drive unit for vehicles with an electric powertrain. Current power semiconductors account for about 20% of total electrical losses, but by creating less resistance when electricity flows through them, the new silicon carbide units increase powertrain efficiency. Toyota is testing out the new technology in a Camry Hybrid and a fuel cell bus in Japan this year to evaluate its performance.
Still to come…the Nissan Juke gets a new set of snow tires, will the new aluminum F-150 cost more to repair than the old one? and the impact of cheap gas on car sales.
EDMUNDS BRINGS THE HAMMER DOWN
It was not hard to guess that body repair costs would go up on the new aluminum F-150, but many of us had no idea how much. So, Edmunds took out its sledge hammer to crunch the numbers. That’s no metaphor. They literally took a sledgehammer to the rear quarter of the bed of the truck. What they found is insurance labor rates for aluminum repairs are about double that of steel and also the amount of time to complete the repair was twice as long. I’m sure both those will start to come down as more trucks hit the street and the body shop guys get more familiar with aluminum repairs. But it still is something to take into consideration. The part that scared me most was the cost of an LED rear tail light with an integrated blind spot monitor that cracked during the bashing. It was a shade under $900. OUCH! As I said in a past Autoline Garage, fender benders are starting to get a whole lot more expensive. If you haven’t had a chance to check out the video of Edmunds bashing the truck, I urge you to follow the link in today’s transcript because it’s real interesting to watch.
NISSAN JUKE NISMO RSnow
At some point I’m sure we’ve all heard someone say “this thing is built like a tank.” Well Nissan is taking that to a whole new level. It took a Juke Nismo RS and fitted individual track-drive systems at all four corners. The vehicle was built as a support vehicle for an ice-driving event in Finland. The other day I said this modified Jeep Wrangler was best suited for winters here in Michigan, but I now stand corrected.
How will low gasoline prices impact car sales? Coming up next, some of the top economists in the auto industry share their thoughts.
AUTOLINE THIS WEEK
Gasoline prices in the U.S. have tumbled over the last several months. So does that mean consumers will ditch fuel efficient vehicles and buy more pick-ups and SUVs? On Autoline This Week, John is joined by economists from Ford, GM and IHS Automotive and here’s what they have to say.
(The ATW preview is only available in the video version of today’s show.)
As always you can watch that entire episode right now on our website, Autoline.tv.
But that wraps up today’s show, thanks for watching and have a great weekend.
Thanks to our partner for embedding Autoline Daily on its website: WardsAuto.com
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Comments (38)
January 30th, 2015 at 12:12 pm
I plan on buying a new vehicle sometime later this year,or early next year.Having said that what I will buy has to be very fuel efficient and utilitarian for me,and price will be a factor as well.Being an old phart I do remember the gas crisis back in the early 70′s,and all the price hikes since then.I view this reduction of fuel costs to be a brief respite only,and will buy accordingly.
January 30th, 2015 at 12:19 pm
One thing about using the tracked vehicle conversion on the Juke is that there wouldn’t be any concern about making the thing look any weirder than it normally does.
Regarding fuel prices: If I could afford a new vehicle, I’d still be interested in either a Nissan Leaf or a Mitsubishi “i” electric.
January 30th, 2015 at 12:35 pm
Bravo! G.A.
January 30th, 2015 at 12:46 pm
I’m not particularly a Ford fan/advocate but it was painful watching Edmunds take a sledge (twice) to the side of that new Ford rear quarter panel. Interesting video; as Sean said, worth watching.
And chiming in on gas prices and what to buy, I’m with G.A.; even when gas was in the mid thirties (yeah I’m old(er) too), economy was on my short list on what I would be buying. But I also agree with the story and think, some, will buy bigger/thirstier vehicles due to the less expensive prices (we are seeing now).
January 30th, 2015 at 12:46 pm
Surprised to hear so much fuss about the Nissan with snow tracks on all 4 corners. This has been done since the model T days (ok, that version had skis on the front/tracks in the back). Recently there have been many memorable versions like in the Ford SEMA display from a number of years ago and more recently the Ken Block version last winter.
Again, so surprised to see Autoline making a story out of this support vehicle. Now if it were and OE option for the Nordic countries then it would be news!
January 30th, 2015 at 12:46 pm
“The part that scared me most was the cost of an LED rear tail light with an integrated blind spot monitor that cracked during the bashing. It was a shade under $900. OUCH!” That is a ridiculous price for a tail light. How much will insurance rates climb?
I better go into the automotive restoration business since it will be cheaper to fix, maintain and insure a classic vehicle versus a newer vehicle.
This type of economics is what is going to make Zip Car flourish in the coming years. Only the wealth will be able to afford new vehicles. This is why Buffet and Soros are getting into the automotive dealership game, not for new cars but for used ones. They see used U.S. cars going to Cuba in the near future.
January 30th, 2015 at 12:48 pm
About Electric Vehicles they have to be available to buy one. Checking for a Leaf in my area are non existant and that is a problem.
January 30th, 2015 at 12:56 pm
LOL,thank you Pedro.It’s really a no brainer,and those of us who are ‘high mileage folks’ do remember the whole gas thing.As much as I wanted a diesel Colorado,I do too much city driving to effectively get the benefits of said diesel.I’ve been doing a ton of research into the matter,and all of it points towards the DPF getting clogged up,or outright failing due to short miles on a constant basis.That would mean downtime for parts under warranty,and later having to foot the bill myself.Not happening.I’m also going to go with a non gdi powertrain.My present 2012 nox is direct injected and I’ve been running nothing but premium for the past two months to try to clean it out.My monthly 200+ mile trips to my ‘local’ VA helps with that.Times change,weather changes,and my needs change.
January 30th, 2015 at 1:04 pm
Eventually, are we gonna run out of non GDI motors to choose from? I hope not, ditto for turbos and CVT’s being the norm in the future.
January 30th, 2015 at 1:25 pm
Whamo!
I liked how Gilpin Ford charged half the labor rate for non-insurance paid work. Geico will be happy to hear that.
—-
Gas
Now might be a great time to lease something rudiculous, while conventional thinking still expects prices to pop back up.
January 30th, 2015 at 1:32 pm
I just drove a non-gdi, non-turbo, non-CVT car, a manual transmission Challenger R/T. It was neat, in an old timey sort of way, big, fast, and fairly comfortable.
January 30th, 2015 at 1:37 pm
Re: #7, G.A., On your next trip to the VA clinic, you might want to check if some changes have been implemented for veterans who have to travel unreasonable distances to a clinic.
At one time the government was considering (HR 3230) anything over 40 miles of travel or over a 30 day wait time, the veteran could use local hospitals or clinics that were not run by the VA.
I don’t know if this bill was signed into law but if you check with your congressman, he/she should be able to give you the latest facts.
Thank you for your service.
January 30th, 2015 at 1:47 pm
It has been a while since I took anything close to a Corporate Tax Class, but I thought these companies put money aside as risk mitigation for Recalls. If so, why is this affected the bottom line now? The money for recalls should be removed from the current operations cash flow, right?!?!
January 30th, 2015 at 1:52 pm
Recalls at Honda
Some weeks ago I asked Honda if my car was affected by the recall. They said a dealer would have to check the car itself. Meanwhile Nissan knew from my VIN that the Versa was unaffected.
So odd Honda didn’t just know.
January 30th, 2015 at 2:29 pm
#13 – Even budgeting a certain amount for recalls, it will be some number generated by past history with known differences. Since recalls in 2014 were “slightly” higher than recently past years, the difference was not budgeted and will show up as a negative variance for 2014. In years when actual recall cost is less than estimated/budget, it shows up as a positive variance which no one questions.
January 30th, 2015 at 2:48 pm
@ # 12,RonE: I actually have a small VA facility about 12 miles away from me.It’s the size of a postage stamp in comparison to most VA’s.It also ranked 3rd worst in the country……with good reason.So that’s why,(for right now) I make the roadtrip.I have been approved for some testing to be done in March,and done locally by civilian doctors….that in itself is a big help,and a nice short drive.As for the ‘Choice card’,some I know have it yet when trying to use it,it is turned down by the VA.I couldn’t tell you why either.My friends that have it are,like me,100% service connected and haven’t been given any kind of definitive answer as to why it don’t work.SNAFU…..
January 30th, 2015 at 2:52 pm
Here is a good article in regards to repairing that aluminum f150.
http://news.pickuptrucks.com/2015/01/2015-ford-f-150-repairs-digging-deeper.html#comments
January 30th, 2015 at 2:55 pm
It looks like those of us who expressed that the repair costs would be more,are right,by a wide margin too.Not including the top of the line tail light,but just for the panels as expressed in the chart.I personally don’t need no steekin’ beer can truck….lol.
January 30th, 2015 at 3:00 pm
Re: Ford taillight—current style headlamp assys have always been big buck items.
I wish car builders would get off the gimmick road & focus on long term defects of design, such as illegible instruments , particularly the speedo, cabin noise & blind spots. Speeding would decline if there was a big red digital
not hidden by shadow or wheel. My Terrain has a great one perfectly located in the trip minder/mileage panel just below the illegible speedo. Mirrors should have deleted years ago.
January 30th, 2015 at 3:23 pm
#15
Thanks!
January 30th, 2015 at 3:36 pm
18 military grade beer can, GA
January 30th, 2015 at 3:51 pm
Just finished watching “Autoline This Week”; good show, a fine trip through the world’s economies for 2015 (all in a half hour) and they pulled it off quite nicely.
January 30th, 2015 at 7:08 pm
Al. isn’t as easy to work as sheet metal, but I wouldn’t get bent out of shape over the differences. Heat can’t be used the way it is applied to metal to pop out dents. I recon a bit more filler will be needed on aluminum. I think hail damage would be one of the toughest damages to repair correctly. And once you get use to it, welding aluminum isn’t that hard to be adequate;Not as simple as wire nor any more difficult than many stick welding situations. Heck, if I can get by, I guess most could do even better.
January 30th, 2015 at 7:44 pm
I saw that F 150 video. Okay my thoughts . Yes it was expensive to repair ,but WOW that aluminum is strong. This guy hauled off and wailed on it with at least a 10-20 lb sledge and put a baseball size dent in the truck at the point of impact and a couple of creases in the 1/4 panel. Now I want to see him do the same thing to the Dodge or Chevy and compare the damage. My guess is 2 whacks like that would cave in the entire 1/4 panel on a mild steel truck. Resulting in replacing the entire 1/4. That would be cheaper than trying to knock out the dent and then fill it. Let’s compare apples to apples. I also think that they’d wind up having fix under structure on the regular steel trucks as well. With what I saw I think the Aluminum will actually not dent as easily as the steel trucks and therefore cost less in the long run with minor contact with objects.
January 30th, 2015 at 8:15 pm
After all of the shops are have the equipment and training to repair aluminum bodies, there probably won’t be a big difference in repair cost. For a while, there will be.
January 30th, 2015 at 8:38 pm
And the rest of the story: Ford CEO Mark Fields took notice of the Edmunds stunt and, during the automaker’s earnings call this week said the company has 750 dealerships that are certified to repair aluminum. The dealership that Edmunds took the truck to was not one of them, and the charge was double what it should be.
“Experience with repair time and cost at one particular dealer in California is not at all what new F-150 customers should expect,” Ford spokesman Mike Levine wrote on Facebook. He also points out that insurance premiums for the 2015 F-150 are about the same as the 2014 truck.
Don’t you just love a nicely “engineered story”?
January 30th, 2015 at 8:42 pm
Wow, taillamp $900! I just replaced a 2015 CTS taillamp (LED) and it was $450
January 30th, 2015 at 9:37 pm
C-Tech, many years ago service workers earned a percentage of the difference of quoted repair time if completed early at the given labor rate,plus their normal wage, is this still the practice at dealerships?
January 30th, 2015 at 11:57 pm
Most dealers and independent shops pays their techs by the flat rate method. There are guides which show a specific time to do a task, such as replacing a steering rack in a Buick Enclave (3.1 hours). If I can do the job faster than the 3.1 hours then I get to keep the difference. If I take more than the time allotted then my income goes down since I don’t get paid any more money.
There are 2 time guides for most tasks, warranty time and customer pay. Warranty time is usually less than customer pay. This is why techs prefer vehicles which are out of warranty.
January 31st, 2015 at 12:12 am
Kia Canine hundred. Did anyone at Kia U.S. really think through the name of this car? Most people paying $50,000+ for a car want luxury amenities which extend beyond the car itself. BMW, Mercedes, Cadillac, Lincoln, Audi, and Acura all provide special services and a higher level of comfort at their dealerships than Kia. The K900 will most likely be the equivalent of the VW Phaeton of a few years ago.
January 31st, 2015 at 5:47 am
C tech I was thinking the same thing. When auto makers jump waaay out of their usual product type. It would have been like Hummer making a sports car. I don’t look to companies like Kia, Hyundai or VW for high end ,super expensive cars.
January 31st, 2015 at 10:25 am
30, 31 Moving up another notch or three, Daimler’s Maybach didn’t do so well trying to compete with Rolls-Royce. They are trying that name again, though, more as a top trim level for the S Class.
January 31st, 2015 at 11:11 am
Spotted
Gulf brand gas 201.9 I never thought it would get below $2 around here with all the taxes.
BMW i8 in white. 2nd one so far, Pedro.
January 31st, 2015 at 1:30 pm
I’ve yet to see an i8. I’ve only seen one i3 on the road.
Gas has been $1.999 at a number of stations around here for a couple weeks. Several “top tier” stations are the same price as the “discount” stations, so I get the name brand, just in case it makes a difference.
January 31st, 2015 at 1:50 pm
33 I hadn’t thought about not seeing Gulf stations, but using their locator, I find that there are no Gulf stations in Florida, and only one in Indiana. Years ago, there were a lot of Gulf stations in Indiana, but it looks like most of them are now in the northeast.
January 31st, 2015 at 3:21 pm
No i3 here yet, but I saw the Merc EV in a parking lot a few nights ago. I thought it was a Mitsubishi until I looked closer.
January 31st, 2015 at 6:53 pm
Haven’t seen one single i8 either, but considering their absurd dealer mark-up, I’m not surprised.
February 1st, 2015 at 6:48 pm
36 The Merc EV is a B-class, their VW Golf competitor in the rest of the world. From what I’ve read, they did a good job of packaging the batteries to preserve cabin space.