Episode 136 – Fiat Wants GM Europe, U.S. Car Sales Getting Worse, Classic Cars Sell Well

May 4th, 2009 at 12:18pm

Runtime 6:46

Fiat is making a bid for General Motors Europe. US car sales fell 34 percent last month and were worse in April than in March. Classic cars have been selling well. All that and more, plus a close up look at the new Ford Taurus.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. Fiat wants to buy GM Europe. U.S. car sales were worse in April than in March. And a close up look at the new Ford Taurus.

Up next, we’ll be back with the news behind the headlines.

This is Autoline Daily for Monday, May 4, 2009. And now, the news.

It’s official. Fiat is making a bid for General Motors Europe. If it can do that, the Italian automaker plans to merge Fiat Auto with Chrysler and General Motors Europe and spin that off as a new automaker that will have 80 billion Euros in annual sales, or about $105 billion. But I keep asking, where is Fiat going to get the people with the managerial skills needed to pull this off? Fiat has a very flat management structure where all its top executives already have two different jobs. And it’s hard to see where they’re going to get the time to work on such a large merger.

Meanwhile, back in the ‘States, car sales fell 34 percent last month. Bad news. But that’s compared to a year ago. The worse news is that car sales in April were lower than they were in March – about 8 percent lower. Every single major automaker saw a drop in sales with two notable exceptions. Honda sales were up 10 percent month over month. And General Motors saw a 6.6 percent increase in sales. In fact, GM gained a big jump in market share to just over 21 percent. The GM divisions that posted the gain in sales were Chevrolet, Buick, GMC and Hummer. You heard right. Hummer! I guess those stupid rally caps really do work!

Several weeks ago we reported that Volkswagen was thinking about a reverse takeover of Porsche to wipe out Porsche’s debt it acquired when purchasing VW. But Wolfgang Porsche, head of Porsche’s supervisory board says the company won’t be sold to VW. According to Reuters, this puts Wolfgang at odds with his cousin, Ferdinand Piech, who advocates a sale of Porsche to VW. Piech also said Porsche should replace its CEO and chief financial officer with VW’s. The sale could be worth 11 billion Euros.

New cars are not selling well. But the Detroit News reports that classic cars have been selling well, particularly at auction houses like Barrett-Jackson. Prices for these sorts of vehicles have dropped slightly, but surprisingly, the market hasn’t bottomed out. Classic cars hold their value and people are starting to turn to them as an investment. Like gold, coins or real-estate, they’re tangible assets and they’ve increased in value over the years

Coming up next, a look at the upcoming 2010 Ford Taurus, we’ll be back right after this.

Every once in a while a vehicle comes along that really changes things. In the 1980s that car was the Ford Taurus. It revolutionized the family sedan with its sleek aero styling and innovative features. Now, after years of neglect, the company is trying to recapture the magic and the sales.

With its dramatic new look, Ford has turned the twenty-ten Taurus into its flagship sedan. Like today’s version, it’s a full-size car with a huge interior, but now it actually has some style.

To match the new body, designers gutted the boring old interior and replaced it with something much more striking. The 21st-century dashboard has a sloping center stack and a two pod shape that reminds me of the Mustang’s instrument panel.

The Taurus’ styling may be all new, but its powertrain isn’t. Ford is again offering a 3.5-liter V6 engine that should deliver 263 horsepower and 249 lb-ft of torque – exactly the same as today’s car. Putting the power to the pavement is a six-speed automatic transmission with a new feature called Grade-Assist, which keeps the car from rolling backwards on hills. All-wheel-drive is still available as an option.

One way that Ford’s trying to get people to Drive One, as its latest marketing tagline goes, is by focusing on technology. With features like adaptive cruise control, rain-sensing wipers and multi-contour seats that subtly massage your back to prevent fatigue, the company is trying to lure younger, more tech-savvy buyers to the Taurus. We’ll have to see if they take the bait.

One aspect of the car that’s never needed improvement is safety. It’s always performed well in crash tests, with today’s car earning a Top Safety Pick from the IIHS. But that didn’t stop Ford from enhancing the 2010 model. Along with many new crash-avoiding technologies, the car also features a stiffer body structure.

Another area where Ford isn’t backtracking is on the price. 26 grand is the cost of admission for a base Taurus, just like the 2009 model. With options piled on, the MSRP climbs into the 30s. Tomorrow we’ll tell the enthusiast half of the Taurus story, and how three little letters spell performance.

And that’s it for today’s top news in the global automotive industry. But don’t forget, you can get podcasts, transcripts and a whole lot more on our website, AutolineDaily.com. Thanks for watching, we’ll see you tomorrow.

11 Comments to “Episode 136 – Fiat Wants GM Europe, U.S. Car Sales Getting Worse, Classic Cars Sell Well”

  1. Ron Paris Says:

    Taking a day off tomorrow John, or out lining up replacement guest hosts for AAH?!

  2. Derek Says:

    Just as a pre-amble to tomorrows show, I want to mention I owned a 92 SHO and loved it. It had nice acceleration, a comfortable ride (all leather), and handled surprising well in the snow. Glad to see the Taurus back and I can’t wait to see what they’ve done with the SHO this time.

    BTW, do you have meaningful update on the Automotive X-Prize?

  3. John McElroy Says:

    @Ron: gotta give a speech in Phoenix tomorrow!

  4. Alex Kajdi Says:

    John,

    What is the MPG of the New 2010 Taurus?

    I hope the Taurus features “Sync” Technology?

    I like the styling, but those fake exhaust ports behind the front wheel need to go!
    Ford designers should replace them with functional lane change indicator signals.

    Would you please aske Mark Fields of Ford North America to bring over some of those Euro Fords.
    The Euro Fords have wonderful styling.

  5. Alex Kajdi Says:

    John,

    I think Fiat is over extending it’s self trying to acquire both Chrysler and GM Europe (Opel).

    Fiat’s power grab will have it knocking on the doors of the White House looking for bailout money because now it is a US Automaker with not even one single unit having been produced.

    The Obama Administration should make it clear to Fiat that there will not be any bailout money available to acquire GM Europe (Opel) once the Chrysler deal is done.

    I could see Fiat in very big financial trouble if the world automobile market does not see a resurgence in the next six to twelve months.

  6. pedro Fernandez Says:

    Re: Fiat, they’re #18 or #19 on the EU reliability survey. Chrysler is #30 (dead last) so they can only improve, I guess. But taking on Opedl may be too much for Fiat. Their reliability has not improve much, even though they’ve been making cars for a hell of a long time. My inlaws had a Taurus wagon back in the mid 80′s, It was really good, why Ford let it go down the hill is beyond me. Hopefully they can catch back some of its former glory again.

  7. craigerzgt Says:

    I worry that FIAT is trying to acculumate companies far too fast for its own good. Chrysler in itself will be a handful; not even Daimler or Cerberus could get it set up properly.

    I personally love the look of the new Ford Taurus. In this age of bland (Accord) or bulbous (Camry, new Legacy) styling, it really stands out as a beautiful car. That V6 will definitely be competitive in this segment I would think. Still, the new Mazda 6 is my favourite in that category. Gorgeous!

  8. Salvador G. Says:

    John Mc.

    Is there going to be some sort live cast from Phoenix we should know about??? And if not, what exactly are you going to talk about?? And can we make recomendations?
    and if so… I like to recomend you talk about todays announcement from the president companies that take american jobs overseas and how that will affect (if any) companies like GM and FORD.

    Have a nice trip John. :)

    Ps. and Heck! bring something back and better not be the flu. humm… Whats good on Pheonix???

  9. Tom Martin Says:

    I owned a 1990 Taurus. I bought it for my son. It was a good, solid, safe, air-bagged mid-sized car that was reasonably priced. I bought it 2-yrs old for $7700. Yesterday’s Taurus is now the Fusion — a well built, reasonably priced, mid-sized car.

    Today’s Taurus is the replacement for the Crown Victoria — a full sized car.

    You can rename a sunflower a “rose”, but that doesn’t make it a rose.

  10. David B. Fishburn Says:

    Mac, Enjoy your trip to Phoenix, and try not to bring anything back that we don’t want! :) When are you going to change the Bridgestone commercial? Tired of the same ol’ thing, need something new. What happened to “Insights” on Friday? The new Taurus looks nice, but the price needs to come down some, esp. in these tough times. I’m not surprised at the news of car sales dropping, what with layoffs left and right. I am surprised by the increase for Hunda and Gm.

  11. Jerry Says:

    Yahoo for Ford!! No government money. Stay away from “Government Motors”. The new Taurus is the hottest full size sedan made. The SHO is like a sports car. The Mustang is still hot and the Fusion is a nice midsize “luxury sport sedan”. Give Ford your support for every thing it has done…without our tax money. GM got 70 billion dollars and is closing Saturn and selling Hummer and GM of Europe. Reward Ford and yourself by buying some of the best cars ever made.