AD #2262 – Classic Car Road Trip, OEMs Pile-On Incentives to Sell EVs, Will Off-Lease Cars Harm Sales?
January 5th, 2018 at 11:39am
Runtime: 9:01
0:30 OEMs Pile-On Incentives to Sell EVs
1:31 New Mercedes G-Class Details
2:22 Mercedes Creates Camper for New Pick-Up
3:26 Will Off-Lease Cars Harm Sales?
6:28 Classic Car Road Trip
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On today’s show…Mercedes reveals more details about the all-new G-Class…automakers are offering heavy subsidies to sell electric vehicles…and we look at a classic car road trip across America. All that and more coming right up on Autoline Daily.
This is Autoline Daily the show for enthusiasts of the automotive industry.
OEMs PILE-ON INCENTIVES TO SELL EVs
Hybrids, plug-in hybrids and battery electrics grew faster than the overall U.S. market in 2017. While total sales fell 1.9%, the green car segment grew 12%. Even so, only 3.2% of shoppers decided to buy a green car. Hybrids easily dwarf sales of plug-ins and BEVs. But sales of BEVs and PHEVs are growing far faster. Automakers are offering heavy subsidies to sell battery electrics. Incentive spending on the BMW i3 tops $17,000. For the Nissan LEAF it’s over $16,000 and over $10,000 for the Chevrolet Bolt. Those are staggeringly high incentives and don’t include any kind of federal or state incentives for BEV buyers.
| 2017 U.S. GREEN CAR SALES | ||
|---|---|---|
| Hybrids | 363,541 | +6.3% |
| BEV | 99,142 | +24% |
| PHEV | 90,839 | +27.3% |
| TOTAL | 553,522 | +12.2% |
| Source: WardsAuto | ||
| U.S. MARKET GREEN CAR INCENTIVES | ||
| CAR | INCENTIVE | % of MSRP |
| BMW i3 | $17,697 | 36.7% |
| Nissan LEAF | $16,271 | 45.9% |
| Chevy Bolt | $10,562 | 23.7% |
NEW MERCEDES G-CLASS DETAILS
The Mercedes G-Class is known as a good off-road vehicle and the automaker is improving that tradition with the new model. It features a ladder-type frame with independent suspension. To keep ground clearance at a maximum, the components of the double-wishbone front axle are mounted directly to the frame without the use of a suspension subframe. And the rigid rear axle is connected to four longitudinal control arms on each side and a Panhard rod to make sure the G-Class tracks straight. The 9-speed transmission has been improved to reduce shift and response times and helps send power through 3 locking differentials. The now more capable SUV will make its debut at the Detroit auto show in a couple of weeks.
MERCEDES CREATES CAMPER FOR NEW PICK-UP
And speaking of Mercedes, aftermarket companies are already coming up with camping solutions for its new X-Class pickup truck. The first is a removable camper that mounts in the bed of the truck and features a gas stove, seats, two beds and even has space to take a shower. The other solution is a fully equipped kitchen that pulls out from under a teak wood tonneau cover. Highlights include a cooler, cooktop, washing station and a second pull out adds even more counter space. So, whether it’s off-roading, camping or both, Mercedes has got you covered.
Are new car sales in trouble with the millions of vehicles coming off-lease? We’ll take a look into that, right after this.
WILL OFF-LEASE CARS HARM SALES?
The car market in the U.S. is being flooded by millions of vehicles coming off-lease. And it’s only going to grow over the next several years. So, will this threaten new car sales? On Autoline This Week, the chief economists from GM and Ford, discuss if off-lease vehicles will have an impact on sales.
(The ATW preview is only available in the video version of today’s show.)
For more of the economists’ automotive outlook for 2018, you can watch that entire discussion right now on our website, Autoline.tv or you can find it on our YouTube channel.
Driving classic cars for several thousand miles in the middle of winter sounds crazy but that’s just what some enthusiasts are doing. We’ll have more about that, right after this.
THE DRIVE HOME
This is the third year of “The Drive Home” where some classic car lovers motor their way to the North American International Auto Show in Detroit. When it started in 2016 there were only 3 cars and a handful of enthusiasts making the trek. But today the cars and the crew have doubled.
Everything kicked off this year with an event in Boca Raton, Florida before the 6 cars and drivers hit the road for a 10 city, 22-hundred-mile trip to spotlight why classic cars need to be driven.
David Maderia, Vice Chairman, America’s Automotive Trust
“When we started people thought we were crazy in Year One. You’re gonna drive vintage cars across America and put ‘em at risk. You kidding me? And we said as you know “Yeah” cars are meant to be driven and we drove ‘em in the snow — they were made for that. And we’re doing it. Cars that are in a museum never driven are dead. Now people get it. And they’re rooting us on and they’re joining us and there’s more enthusiasm about it when there were a lot of skeptics. I don’t hear the skeptics anymore.”
In fact, some joined this year’s event to take advantage of the towns that the drive visits as well as the people it touches throughout the 10-day tour.
Diane Flis-Schneider, Executive Director, Concours d’Elegance of America
“It’s a great promotional opportunity, this event, this drive, over 2,200 miles will reach some great car enthusiasts in many destinations in many states, many who are unfamiliar with what we do, and love to take a vacation and thought they would like our event to be an experience for them.”
And if you’d like to experience The Drive Home in person, maybe talk to some of the drivers or check out the cars, we’ll put a link to its website in today’s transcript. That’s where you can find the remaining schedule and stops before it wraps up on January 12th outside Detroit.
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 (25)
January 5th, 2018 at 12:13 pm
To me, old cars are to be driven, but intentially hastening their destruction by driving them in road salt, and in conditions where crashes are likely, is silly, IMHO.
January 5th, 2018 at 12:15 pm
Sean,
I disagree with the OEM spend for the Chevrolet Bolt. The figure had to include the $7,500 Federal Tax credit. Near the end of the month, GM offered Employee pricing which was on average a little over $3,000 savings for most vehicles (but the dealer did not receive anywhere near that number in true incentive money and $1,500 for current GM leasees. If they were giving $10,000 off plus the $7,500, all would be gone from dealers lots.
January 5th, 2018 at 12:16 pm
If Chevy would sell the Bolt everywhere, rather than in only a few places, they wouldn’t need the $10K incentives.
January 5th, 2018 at 12:27 pm
Kit @ #1 I agree with you 100% My car goes in hibernation in Nov and doesn’t see the light of day until late April or May. Not a chance I’d drive it on Detroit streets in January. .As far as electrics as I said before they will be the end of the car business. They can’t sell what they have even with incentives and they talk about making their entire fleets electric. It’s financial suicide. When you lose your ass on everyone you build and then can’t sell them is just insane .
January 5th, 2018 at 12:37 pm
Tesla sell three model and for December 2017:
~4,800 – Model S
~3,400 – Model X
~1,050 – Model 3
- – - – -
~9,250 – Tesla sales in December
Yet curiously only Model 3 sales receive automotive press notice. Yet it looks like synergy is improving production rates of all Tesla.
FYI, Chevy Bolt sales are following a curious, linear rate of growth over the past four months. Not impossible but a linear rate over four months makes one wonder what is going on.
My link is to our analysis of the last four months of efficient car sales.
January 5th, 2018 at 12:52 pm
Don’t really think the Mercedes G class needs camo to hide those refrigerator box body lines.
Also Camper accessories for a Mercedes seems like putting a helio pad on a mobile home. But maybe I underestimate the desire to camp by today’s Mercedes buyer.
I agree cars are meant to be driven and finding the balance between maintaining a vehicles integrity and still using it for the intended purpose defines the difference from a classic car and what becomes an art exhibit.
I doubt they knew about the bomb cyclone when they agreed to make the trek though.
January 5th, 2018 at 12:53 pm
5 Maybe the linear growth of Bolt sales, means that they are gradually selling them in more locations. Just a thought. To my knowledge, though, they still don’t sell them at my nearest dealer.
The Model 3 receives the press notice, because they are many months behind in their production goal of 5000/week. They are making progress, though.
January 5th, 2018 at 1:05 pm
Kit #1, XA351GT #4, I had mixed feelings at first, but now I completely agree with you guys.
If you’re gonna put a classic car at risk of accidents and road salt just to prove a point and raise “awareness” about calssics, do it with one that you HAVEN’T sunken tens of thousands into. Save the pampered, polished ones for weekends between May and October.
But, in the end, it’s their choice. I won’t throw shade. That old Detroit metal may be thicker gauge, but it lacks the rust proofing of modern cars.
January 5th, 2018 at 1:09 pm
Off-topic here…
I saw my first Bentley Bentayga on the road the other day (white). I knew I would eventually, because Continental GT’s, Flying Spurs and even the occasional Mulsanne are sighted weekly around here.
I must say I was sharply let down. It had not nearly the degree of ‘road presence’ I had built up in my mind it would.
January 5th, 2018 at 1:09 pm
One of the cars is a ’59 Plymouth. Those would rust out in about 3 years, even without road salt. Maybe the owner has a good source for custom made body parts.
January 5th, 2018 at 1:59 pm
“Green/Ev” car and trucks should be sold without any government incentives. Let the market/demand with out incentives determine the outcome. The best car for the enviroment is the one that is built to last for the lowest price.
January 5th, 2018 at 2:04 pm
Today’s drivers don’t know how to drive a RWD vehicle with front weight bias in the snow. Many snowbelt drivers in FLAT states think they must have AWD… even on FWD platformed vehicles. Well, if the roads are so bad that you think you need AWD to get forward traction, then the roads are too bad for cornering and braking… STAY HOME!
Consequently, I doubt there are any drivers under 60 years of age in that classic car pilgrimage.
January 5th, 2018 at 2:05 pm
Woke up this morning to -4 degree drive to work and the usual chalky white pavement of salt residue. I dont like to expose my everyday driver to these conditions let alone a classic. Which is why I’m guessing there are only 6 cars making the trip.
January 5th, 2018 at 2:18 pm
#11 Fred I sort of agree that the government shouldn’t interfere with private market and be giving out incentives to push an agenda of EVs. However they already force the production of cars no one wants with EPA requirements. Manufacturers produce many econo box cars with high MPG ratings to help off-set the gas sucking SUV and trucks that they cant make enough of. Not sure of the facts but read somewhere that lots of the econo cars are sold at cost/minimal margins just to satisfy the EPA requirements.
So again if the Government is going to make the automakers build cars that are hard to sell then they should offer incentives and help push their agenda that isnt necessarily the agenda of the automakers.
Because I truly believe if you removed all government regulation and EPA requirements truck/SUV/CUV sales would grow even more and manufacturers would probably continue EV development but would not be pushing them to market until they were on par with ICE vehicles.
January 5th, 2018 at 2:23 pm
#12,13 Exactly, on both counts. The people who think they “need” AWD probably rear end other vehicles a lot, when driving on slick stuff. With AWD, you accelerate better, but you don’t stop any better.
January 5th, 2018 at 2:26 pm
If the goverment hadn’t subsidized gas cars 110 years ago, we’d still be riding horses. Well, not really, but car use would have come much more slowly without major oil production subsidies.
January 5th, 2018 at 3:27 pm
The weather is NEVER good in Detroit at the time of the Auto Show. Salt use and buildup on the roads has been happening for about a month by then, if not more.
I agree with their concept, just not their route. Why not go from Florida to the LA Show? Or even the NY Show, since it takes place in April after the winter weather and is a show that could give them more publicity.
January 5th, 2018 at 3:40 pm
#17. Very true, and good points. But something tells me they’re waxing nostalgic about bringing the cars back to their original birthplace – Detroit. Nothing nostalgic about a drive to Florida.
And don’t get me wrong. I’d much prefer that drive myself. But I think it would defeat half of their purpose.
January 5th, 2018 at 4:53 pm
Florida, at least some places like Miami beach or Daytona, can by nostalgic. I went to Florida for the first time, with my parrnts, in a 1955 Dodge.
January 5th, 2018 at 6:39 pm
The dealer in Greenwood IN just got their first two Bolts… Both were optioned up. In talking to my salesman, there are no special incentives on them. In checking the Chevrolet website, the only cash incentive on Bolts is a $2017 bonus to clear out 2017 models, nothing on 2018 models. I don’t know if there is less or more spread between dealer costs and MSRP such that dealers could add a little more incentives on their own. I don’t see how there could be $10k incentives on them, unless it is only offered in CARB states where the ZEV credits allow them to add additional incentives.
January 5th, 2018 at 6:40 pm
On the $16k LEAF incentives. That is probably related to clearing out the old model to make room for the re-styled model that is coming (or is it here?)
January 7th, 2018 at 5:30 am
Called the ‘problem of the commons’, the air we breath is a common resource necessary for all. We’ve already run the experiment of unregulated automobiles and failed. In 1960 and early 1979s, Los Angles, Denver, DC, and New York were becoming unbreathable (see user link.) For example, in 1972 I was driving in Riverside CA and the pollution was so bad my eyes teared up on a ramp and I was all but blind. It was worse than the gas hut I’d been in a year earlier at Camp Pendleton.
There are degrees of Ayn Rand enforcement in states including Alabama where they only match the VIN to title and registration. So once a month, I’ll see a blue cloud car and more than once a week follow or adjacent to cars or trucks that gutted their emissions equipment … perfect for an exhaust gas headache.
We in the USA are not alone. #11 and #14 should realize the Chinese, Japanese, Korean, and Europeans have had a ‘Come to Jesus’ moment about air pollution. The people who keep their politicians in office have had enough and that changed their public policy. So cheating VW diesels are under attack and suffering loss of sales. Heck, if it weren’t for Tesla eviscerating the luxury car market, they would still be losing market share. It is what has gotten the major USA manufactures to start moving product from the lab to the assembly line.
So those who bemoan USA regulations should take a week long trip to Mexico City. Then they can maybe understand the grim future they advocate returning.
January 7th, 2018 at 8:31 pm
#22. The Europeans not only wanted air they could breath, but also noticed that buildings and monuments were being eaten up by urban acid rain, caused by high sulpher diesel fuel. As a result, the EU has led the world in requiring low sulphur diesel.
January 8th, 2018 at 3:32 pm
Incentives on ev s by manufacturers are because the BMW i3, Nissan Leaf and Chevy bolt are so ugly.
Who spends 30 or 40 grand on an ugly ungainly vehicle even if it’s electric.
Teslas hot because the model S and model 3 are quick high performance vehicles that are works of art.
No manufacturer incentives needed and 400000 reservations exist for a reason.
Beauty and speed drive a passionate desire to own the tesla. Jaguars I pace has 25 reservationists and we don’t even know the price in the USA yet although it’s been rumored 76 to 92 grand is the number…
At that price it’s a small market yet again but still the list is 25000 reservations long.
There is no incentives needed …because it goes from zero to sixty in 4 seconds and is stunning to look at with its cuv shape.
Jmo
January 9th, 2018 at 9:21 am
“Yet curiously only Model 3 sales receive automotive press notice. Yet it looks like synergy is improving production rates of all Tesla.”
Actually a fair amount of discussion on Seeking Alpha about the sales jump being largely older inventory (possibly discounted)
#22 Bob Wilson, AWESOME comment. Hate the knee jerk “government regulation BAD” reactions. Do NOT want to go back to tainted water and brown air, less supervision of food companies, etc.