AD #2755 – Mahindra Roxor Drops Jeep-Like Grille; Cruise Calls for Better AV Metrics; Jeep’s Sales Worrying
January 21st, 2020 at 11:59am
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Runtime: 9:39
0:07 Mahindra Roxor Drops Jeep-Like Grille
0:51 Cruise Calls for Better AV Metrics
1:54 Magna Stops Developing Full Autonomous Tech
2:28 Tesla Fires Back at Unintended Acceleration Claims
3:44 Nissan Scandal Affecting U.S. Sales?
4:35 Jeep’s Sales Worrying
5:13 Detroit Three Struggle in China
5:59 How Much Cybertruck Design Would Cut Costs
* Thanks to Kendall for the new original artwork for the set. *
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This is Autoline Daily reporting on all aspects of the global automotive industry.
MAHINDRA ROXOR DROPS JEEP-LIKE GRILLE
As we’ve reported, Indian automaker Mahindra is under fire over its Roxor off-road vehicle because of its resemblance to a Jeep. FCA filed a complaint with the International Trade Commission and a judge made a recommendation to the ITC that Mahindra should have to stop making and selling the Roxor in North America. So it’s no surprise to see that Mahindra has redesigned the Roxor for 2020 and it no longer features its Jeep-like grille. The ITC is likely to make its final decision in March and while Mahindra is hoping this redesign will appease regulators, it still does not address Jeep’s trade dress issue, which says other aspects of the Roxor make it look like a Jeep.
CRUISE CALLS FOR BETTER AV METRICS
GM’s self-driving startup Cruise put its plans to launch its autonomous ride-hailing fleet in California on hold for further testing and evaluation. And now Cruise co-founder Kyle Vogt is saying we need new ways to determine if autonomous vehicles are ready for the public. One of the factors the California DMV monitors is disengagements, which is when the vehicle is switched from autonomous to manual mode for a safety reason. Vogt says that metric is inadequate and would rather see “data on the true performance of human drivers and AVs in a given environment and an objective, apples-to-apples comparison with statistically significant results.” We’re still in the very early stages of self-driving vehicles and there’s still a lot of questions that will have to be answered. But we’ll learn more later tonight about Cruise’s plans at event it’s holding in San Francisco, which it has been teasing with a series of cryptic Instagram messages.
MAGNA STOPS DEVELOPING FULL AUTONOMOUS TECH
Another question facing autonomous vehicles is, how do you make money with them? The supplier Magna has been developing autonomous components for years, but says it’s no longer going to develop fully autonomous technology because it’s going to be a long time before that market really takes off. Instead, Magna will focus on driver assistance technology, up to Level 3 autonomy. That’s where it’s going to get higher volume. As part of the move, Magna and Lyft are ending their partnership to develop self-driving technology.
TESLA SLAMS BRAKE ON UNINTENDED ACCELERATION CLAIM
Accusations of cars accelerating out of control all on their own have been around for decades. In fact, they started when the automatic transmission became popular in the 1950s. It’s called unintended acceleration, and in the U.S. in the 1980s lawsuits almost drove Audi out of business. More recently Toyota was accused of building cars that accelerated out of control. And now it’s Tesla’s turn. But Tesla is firing back. The company put out a scathing post on its website yesterday saying the accusation was false and was started by a short seller, who hoped to drive the company’s stock down. Tesla pointed out it collects all kinds of data from its cars in real time. And it has reviewed complaints with NHTSA. In every case it was able to prove that the vehicle functioned perfectly, meaning people were hitting the accelerator pedal instead of the brake.
NISSAN SCANDAL AFFECTING U.S. SALES?
There’s a couple of worrying developments on the sales side that we need to point out. We start with Nissan, which is going through a terrible time, because of the scandal with its former CEO Carlos Ghosn. The effects of that are rippling through the company. Last month Nissan’s sales in the U.S. plummeted by 44,000 vehicles, a 27% drop. Now why would a scandal in Japan affect sales in the U.S.? We think it’s because Jose Munoz, who used to run Nissan North America, left the company. He was one of Carlos Ghosn’s top lieutenants, and anyone who was associated with Ghosn is gone. Worse yet for Nissan, Munoz went to Hyundai, which is enjoying strong sales. No doubt Carlos Munoz knows exactly how to attack Nissan in the marketplace.
JEEP’S SALES WORRYING
The next brand we need to worry about is Jeep. Yes, Jeep. Its sales were down 5% in the U.S. market last year, and were off nearly 6% last month. We thought the addition of the Gladiator to its lineup would boost sales. Instead, every Jeep model, with the exception of the Grand Cherokee, saw its sales drop last year. What’s going on here? Jeep was the hottest brand in the hottest segment. Mike Manly, who used to run Jeep and oversaw its impressive growth, is now CEO. Is that the reason, or is something else going on? We welcome your viewpoints.
DETROIT THREE STRUGGLE IN CHINA
Now let’s move over to China, where car sales are down for just about everyone, but have been an unmitigated disaster for the Detroit Three. Zo Zo Go reports that last year, GM’s sales in China fell 16%, FCA’s were down by 41% and Ford’s plummeted 48%. All three say they need to refresh their product lines and get more Chinese influence in their business. Collectively their sales fell by 822,000 vehicles in 2019 which will take them years to recover from, if they ever recover.
HOW MUCH CYBERTRUCK DESIGN WOULD CUT COSTS
The wild styling on the Tesla Cybertruck is polarizing to say the least. But we believe one of the reasons the truck has flat surfaces and hard breaks may have more to do with reducing tooling costs. To answer that question, we invited Sandy Munro from Munro & Associates on last week’s Autoline After Hours. And he detailed just how much the Cybertruck’s design will help to cut costs.
Sandy Munro:
“We were looking at the Tesla (Cybertruck) and we think that the blanks are going to come in two size(s). Why not?
John McElroy:
“You’re talking about the steel blanks that would then be formed to make body panels?”
Sandy Munro:
“Yeah, because you could water jet it or laser cut it or whatever. Water jet is what I’d pick because, to me, it goes faster and it works well. And with 3mm stainless (steel) it would work just fine. And I don’t want to take a heat treat away. I don’t know what that stainless steel is, they just call it 300X, but I know it’s a stainless steel they’re using on the Falcon and SpaceX. So, I know that…”
John McElroy:
“So, they’re using SpaceX technology in the Cybertruck!”
Sandy Munro:
“No doubt about it. The steel is definitely that. I think that we’re going to be looking at press breaks and simple stamping. I don’t see a reason for a paint shop. And where painted parts are needed, I think what they’re going to do is they’re going to come in painted by the supplier. I think the body shop will be manual (unintelligible), and this is based on 50,000 a year, I don’t know what they’re real target is, but I’m looking at 50-grand a year because I don’t know enough about their marketing strategy. I don’t think they’ll have a paint shop. It’s (parts) going to come in painted. The body shop will be manual load, auto clamp. We’ll have manual tack and then robotic tig welding because it’s just simple that way. I think the CapX (capital expenditure) for 50,000 (trucks) would be about $30 million bucks.”
John McElroy:
“Which is nothing.”
Sandy Munro:
“Well, I’ve got the other stuff too. So, let’s look at an F-150-type truck. And we’re going to use everything like an F-150, but we’re looking at 50,000 a year. If we look at it, we’ve got, qual stock will come in and will go into blank dies and whatnot. That’s about $25 million. The body shop with partial automation and multi spot welders, about another $35 million. Paint shop, another $155 million. That means the CapX total for that is $210 million. So, you’re looking at a difference between $30…”
John McElroy:
“$210 million for an F-150 built at a 50,000 a year volume is what you’re saying?”
Sandy Munro:
“Right. And I need $210 million. Whereas with the truck (Cybertruck) we just looked at it’s like $30 million.”
It looks like Elon Musk even watched that show because he tweeted out that Sandy’s analysis is accurate, both pro and con. And he went on to say that Sandy will appreciate some elements of the Model Y body design. So for more of Sandy’s analysis, you can watch that entire show right now on our website, Autoline.tv or you can find it on our YouTube channel.
But that’s it for today, thanks for watching and please join us again tomorrow.
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Comments (69)
January 21st, 2020 at 12:14 pm
Nothing for nothing, but now the Roxor Grille resembles a Landcruiser FJ 40. I hope that doesn’t get them in trouble with Toyota….
January 21st, 2020 at 12:15 pm
Everything about Jeep is old. You think Jeep and it seems like nothing has changed for twenty years.
And BTW, how come Jeep vehicles don’t have the model designation showing on the rear? I’ll pull up behind some Jeep in traffic and often have no clue which model I’m looking at. Not a smart advertising move.
January 21st, 2020 at 12:15 pm
Regarding Jeep sales, most Jeep products have no redeeming virtues, compared to the competition, and more people are starting to notice. Compass, Renegade, and Cherokee are among the worse vehicles in their class.
Wrangler and Gladiator make little sense for most people, but their cult following helps sell them. Grand Cherokee, with its M-B dna, is still a decent vehicle, and priced ok, if you don’t load it up too much.
January 21st, 2020 at 12:26 pm
Loving the motocross picture (upper left); memories of my long lost past (YZ-250, back in the late ’70′s for me).
Jeep’s reduction; maybe saturation of whom can afford and maintain these increasingly expensive vehicles. And they are beginning to merit the poor reliability they’ve earned but hitherto have been ignored by buyers.
I tend to agree that the Tesla complaints of unintended acceleration are as described: operator error (as have most from the other companies complaints over the years), though, I did have an episode or two with my ’88 Jeep Cherokee (but easily handled with a firm application of the brake and cleaning of the throttle body).
January 21st, 2020 at 12:27 pm
I like the looks of the Mahindra better with the 2020 grill.
Good decision on Magna’s part. I agree that full AV are a long way off. Focus on level 3 driving assist features and avoid losing millions. And the liabilities.
January 21st, 2020 at 12:32 pm
Does anyone know if Tesla floor mats have attachment points to the floor like almost all other car makers?
January 21st, 2020 at 12:32 pm
Lots of news today to comment on!
A. Justice was served to the crooks at Mahindra. Actually, their illegal jeep-like design with the 5 slots looked ridiculous, like some kind of headgear or turban they wear in India. Their new design looks better, ironically. FCA is correct that other aspects of this fake also are Jeep-like (the way the panels curve or don’t curve etc). Stay tuned.
B. Cruise should stop wasting billions as soon as it can.
C. MAGNA got it! No AV BS, but helpful level 3 techs will be far more welcome by the almighty consumer.
D. Tesla unintended acceleration: it’s a HOAX, just as the hoax that almost bankrupted Audi in the 80s. There was nothing wrong with either car, the fault was in the careless idiots who drove them and hit the gas instead of the brakes.
E. Nissan made a ton of mistakes in the US markets that were 100% unrelated to Ghosn’s crimes. Hyundai sales are a little better only because they were weak for years. Not only Hyundai will pick the falling Nissan Share, but also its far superior peers, Toyota, Honda, and Subaru.
F. Jeep Sales: You asked us for this one. Jeep had a HUGE run for years and years. Did you expect the good times would last forever? Why???? And when that POS Gladiator sells for $60k and has failed to win a single serious comparison test with peer trucks that cost half as much, you think Jeep Fanatics will overlook that too?
G. Detroit 3 (IF FCA counts as a Detroit maker) in China: Right, as you said, “if they ever recover”. With Tesla making 500,000 reasonably priced model 3 and Y every year there, and the huge push and incentives for green cars by Beijing, GM will have a vcery hard time there. FORD and FCA sell far less in China than GM does.
January 21st, 2020 at 12:37 pm
3
Strongly agree about Jeep. Now that CUV/SUV models are pervasive across the marketplace, they’re being out-competed for value. Jeep GC is still a good ride and they’re *very* aggressive on the sales floor. Co-worker went in recently to snag a 2019 in their big year-end sale, but they didn’t have what he wanted, so they gave him the same deal on a 2020 unit!
Re: Mahindra
As I’ve said before, nobody ever bought a Roxor because they thought they were buying a Jeep. It’s a stupid argument and one that only enriches the lawyers. I doubt if anybody not a lawyer at FCA really gives a rat’s behind about the Roxor.
January 21st, 2020 at 12:38 pm
6 I found an ad for some aftermarket mats for Model S, and in the photo, they looked like they had attachments.
January 21st, 2020 at 12:41 pm
Unless they start selling a street-legal Roxor, what difference does it make what it looks like? Roxor is in no way competition for anything Jeep sells.
January 21st, 2020 at 12:46 pm
https://wardsintelligence.informa.com/WI964443/FCA-Leads-in-48V-MildHybrid-Space
My daily Ward’s email just received had this article about 48v mild hybrids at FCA.
Anybody knows exactly what improvement in city/hwy/avg MPG numbers these systems produce?
January 21st, 2020 at 12:55 pm
Jeep simply cut back some of the lease incentives on various jeeps such as the compass,cherokee etc…by about 8 percent…
So a five or six percent drop is not surprising.
Grand Cherokee is about to get revamped and still has even more massive lease incentives.
Thats your answer on why jeep sales are off five or six percent.
You can take that to the bank.
Every vehicle in this day and age is becoming more and more a commodity especially after 3 years after release
January 21st, 2020 at 12:56 pm
The SHORT who accused Tesla of unintended acceleration just got a wedgie, TSLA at $541 just now. Friday it closed at $510. After the Toyota fiasco, the NHTSA issued standards for data recording in the airbag controller which includes metrics needed to identify operator error.
January 21st, 2020 at 12:56 pm
Thanks for all the feedback on Jeep so far. Very interesting to read what you all have to say.
January 21st, 2020 at 1:00 pm
I wonder if the “Cult Following” for Jeep is getting near some kind of saturation to follow a shift. The vibe I get reminds me of Harley Davidson a bit.
January 21st, 2020 at 1:01 pm
The Chinese people are incredibly nationalistic and more than just waving a flag, they will take action.
With the Trump trade war, do you really think that this would not decimate American companies in China?
Ford in on the verge of bailing out and expect many other American companies to be wiped clean from the Chinese market or be taken over by their Chinese State Owned Companies. You can’t win a trade war against a Communist dictatorship.
January 21st, 2020 at 1:03 pm
@Brett Cammack & Kit – It might be a bit of a stretch, but I think there is one area where the Roxor competes with Jeep. And that’s for businesses that use vehicles that don’t go on the road, like amusement parks and zoos. I was told by someone at Mahindra that was one area where sales were stronger than it ever expected. The businesses liked that they could get the Jeep look without having to spend the money for a real Jeep.
January 21st, 2020 at 1:05 pm
I love the production techniques of the upcoming cyber truck and want to see similar production technique for a small ev macan sized tesla and a sports car …all in stainless like this cyber truck…
The 95 percent lower production costs of the cyber truck Im all in and it not only looks cool as hell but its dent resistance is a huge plus!
I dont need the bullet proof glass so they can drop that extra cost if its expensive…
Give me a model 3 performance oackage in a targa topped stainless steel cybersportscar for 50 grand and we just took over the sports car segment …
Leave the wrap, painting etc to the aftermarket if some need that. Hell tesla stores could do it as dealer installed options if consumers demand it.
I for one want it in stainless with a never having to wax again..(that being said after a decade of daily driving a black corvette! Hehehehe..
Keep that set evolving forever Sean…looks great yet slight evolution is always fun…bring the puppy dogs on the set again …just for fun! Car lovers also love their pets ! Crazy idea but a once week appearance of your dog or oet would be humanizing the technical aspect of the show…
Just an idea…to consider at the very least..
January 21st, 2020 at 1:14 pm
16 Ford and FCA sales in China never amounted to anything. It is GM and VW who dominated sales there for decades.
Have you ever actually been in China? Your impression of it seems stuck in the days of the Cultural Revolution and other econ illiterate stunts of Mao.
January 21st, 2020 at 1:20 pm
Sean, your set is looking better and brighter lighting is working well.
January 21st, 2020 at 1:28 pm
17
But… what sort of volume are we talking about?
Corporate lawyers are notorious for “protecting IP” for their customers. It’s how they justify their billing every year. Like the Texas craft beer maker years ago, “Lone Star Bock”, got a nasty “cease & desist” letter from Starbucks for “infringement”. Yeah, right.
January 21st, 2020 at 1:34 pm
17 Sean, I hadn’t thought of that, but it makes sense. I see various other “not sold in America” vehicles, like tiny pickup trucks and vans at theme parks, etc. The ones I’m thinking of are probably street legal various places around the world, but not here. Roxor would have the right “look” for a number of parks, etc.
January 21st, 2020 at 1:41 pm
18 With the stainless body, you’d need to dry it all the time to keep from getting water spots, like my kitchen sink. No, I’m not serious. Rain water doesn’t leave water spots like most tap water, and stainless would be the ultimate surface for those who never wash their vehicle.
As far as the “look” of stainless, I never much liked it, and thought DeLoreans looked much better when painted red or white. There will quickly be an aftermarket for painting and wrapping “cybertrucks,” for those who want it.
January 21st, 2020 at 2:00 pm
23 I don’t mind unpainted cars, they look much better than many actual colors, esp pink, but also some greens and oranges.
My top objection with the Cybertruck is its “Conehead” design with the pointed roof. Couldn’t it have even a small horizontal section that would increase rear headroom and allow for the all-important sunroof? I doubt such a design change would affect the aerodynamics much, or add to the cost significantly.
January 21st, 2020 at 2:04 pm
https://video.mpt.tv/video/2020-mercedes-benz-glc-300-2020-range-rover-p400e-mc6eah/
Motorweek got a long term Rav4hybrid and over 13k miles they got an excellent 39.2 mpg.
However they hated how sluggish it feels.
January 21st, 2020 at 2:13 pm
Tesla claims ” to collect all kinds of data in real ” If that doesn’t give you pause nothing will. Do you want to be spied on every time you drive? How long until law enforcement finds away to access that data ? I can see the future as every time to exceed the speed limit the police automatically send a fine. They will and can track your every move . You know this will all wind up being used in a court somewhere to prove a point of view. Late on a car payment they shut off the vehicle. The possibilities are too much to trust others will use that power correctly.
January 21st, 2020 at 2:22 pm
26 We know, you are a horse and buggy afficionado.
I could not care less and I have participated already in research programs where my 1998 BMW 740iL was wired and all the data was analyzed by our UM Transportation Research Institute, along with 1,000s of other vehicles. I got a cool $500 total in $100 and $200 increments for my participation, and was sorry to see the project end.
January 21st, 2020 at 2:24 pm
26, 27 cont’d. I could care less, because I have NOTHING TO HIDE, and my data will help the automakers build BETTER and SAFER VEHICLES.
You want to stick to your coal-stove fueled breadvan, hope you use it within a 10 mile radius from where I live and work.
January 21st, 2020 at 2:28 pm
25 CR got a 7.8 second 0-60 time from the RAV4 hybrid, tied with the Camry hybrid, and .2 seconds quicker than a 2008 E320 Bluetec. I was a little surprised that the RAV tied the Camry, but after checking the weights, I’m not surprised. The RAV weighs only 240 pounds more than the Camry, and has a little more power, from its electric motor on the rear wheels.
January 21st, 2020 at 2:34 pm
29 what overall MPG (not city) did CR get for the Rav4hybrid?
My 320 Bluetec is listed by Mercedes to have 6.9 0-60.
January 21st, 2020 at 2:39 pm
30, 29: And this was in a Mercedes brochure for the 2006 model year.
January 21st, 2020 at 2:39 pm
30 They got 37 overall for the RAV, 47 for the Camry hybrid, and 29 for the E Bluetec.
In the 65 mph steady speed highway test, they got 41 for the RAV hybrid, 53 for the Camry hybrid, and 35 for the E diesel.
January 21st, 2020 at 2:40 pm
https://www.google.com/search?client=firefox-b-1-e&ei=dlMnXp3gNcastQaFnpPgAw&q=0-60+for+the+2007+Mercedes+E320+Bluewtec&oq=0-60+for+the+2007+Mercedes+E320+Bluewtec&gs_l=psy-ab.3…10595.10595..10875…0.2..0.52.52.1……0….1..gws-wiz…….0i71.f300dnIBt0E&ved=0ahUKEwid88KKuZXnAhVGVs0KHQXPBDwQ4dUDCAo&uact=5
And the 2007 gets 6.6 seconds 0-60
January 21st, 2020 at 2:42 pm
https://www.roadandtrack.com/new-cars/road-tests/reviews/a13197/2007-mercedes-benz-e320-bluetec-1/
R&T gave it 6.7. All much lower than those of the Rav4, and no surprise.
January 21st, 2020 at 2:46 pm
30,31 Maybe Mercedes “torqued up” the transmission for their test. I’m pretty sure CR “just floors it” from a standing start for their test with automatics. That could make a second difference, as the engine needs to rev up, and the turbocharger spool up to get full power. I think the car they tested was a 2007 rather than a 2008, though they are probably the same.
January 21st, 2020 at 2:52 pm
35 I confirmed that CR starts their acceleration runs with the engine idling. I doubt if R&T does it that way.
January 21st, 2020 at 4:25 pm
26 I can see your concern but I think providing this data to law enforcement just so they could issue citations would be a stretch and certainly get some legal pushback. Certainly not the intention behind it.
With that said I’m sure the road sensors and digital cameras were not invented for the purpose of setting up traffic nannys.
I could easily see police forces using drones to monitor multiple vehicles at once and swoop in for a shot of the plate and issue tickets that way soon. Since that has to be cheaper than a plane or chopper.
The obvious solution (before Kit mentions it) is just don’t speed.
There will be a struggle to generate enough revenue if everyone had to obey the law. The legal system is a money making machine.
January 21st, 2020 at 4:31 pm
37 I almost always speed, but limit the amount over the limit to what I think will avoid tickets, and crashes. So far, it’s worked pretty well over my 50+ years of driving.
January 21st, 2020 at 5:04 pm
I think that Jeep is pricing themselves out of the market not only with the gladiator but all their models. The Wrangler that was always a value type of vehicle that worked well for younger consumers today the Wrangler is EXPENSIVE for what it is. It is trading on the Jeep name and history. Possibly that is why the sales are going down.
January 21st, 2020 at 5:04 pm
People who have kept true to old fashion principles doesn’t mean they don’t accept new ideas. I think there is a very valid point to have ones privacy protected and especially have the right to deny the use or collection of any data on oneself without permission.
This “ horse and buggy” label is just another demeaning jab towards other who do not agree with all the BS that comes from Larry’s mouth. Sad…..
January 21st, 2020 at 5:40 pm
39 From the Jeep build and price tool, it looks like the very cheapest 2 door Wrangler, without A/C is $28,295 MSRP. I didn’t know there were any vehicles in the US market without A/C standard.
January 21st, 2020 at 5:43 pm
If there were thoughts of giving speeding tickets, using in-vehicle data logging, I’d think it could become a political issue.
January 21st, 2020 at 6:08 pm
28 LOL coal-stove fueled bread van. That’s good one coming from a guy that runs dirty diesels. LOL .
January 21st, 2020 at 7:20 pm
I hope Autoline TV will be able to report on the Michigan settlement “see link to The Detroit News article”:
“The settlement would end a Tesla lawsuit against the state over a law that banned company-owned stores and barred Tesla from opening service centers.The settlement could cause other states that also have stopped Tesla from selling to follow suit, a potential win for Tesla’s effort to peddle its Model 3 compact EV to a broader market.”
January 21st, 2020 at 7:41 pm
44 Will Texas be next?
January 21st, 2020 at 9:12 pm
Just read a Detroit News article.
Tesla can, starting Wednesday, sell and service their cars in Michigan.
January 22nd, 2020 at 7:00 am
#45 & #46 – This is where we need the details.
A Federal court case, it sets a precedent that might apply elsewhere. One problem is matching the Michigan law to laws in other states. But there will probably have to be suit in each State.
January 22nd, 2020 at 7:51 am
47 The Detroit News article indicated that the MI attorney general, a Dem had involvement with the settlement. I suppose things could be a lot different in other states, like TX and OK. It will be interesting, as will the details of what will happen in MI.
January 22nd, 2020 at 8:14 am
44 I’m kinda surprised its taken this long. Tesla has missed out on lots of potential sales. I really expected Elon to devise a work-around this law. Personally I would have opened a second company to sell Tesla’s to in fleet amounts only to deliver them to states that have banned him and sell them as used to nationwide used lots like Carmax. Everyone would know they’re getting a new car without ever visiting a dealership. I don’t think Tesla cars are unable to be sold as used cars.
January 22nd, 2020 at 8:28 am
49 I’ve wondered if people buying Teslas in the states where they can’t be sold, have been able to take the certificate of origin to their home state and register the car, or if they have had to register them as a “used” car in some of these states. That would complicate things, and in many cases, you might have to pay double sales tax.
January 22nd, 2020 at 8:28 am
48 The big question here is will this be part of a larger picture into the future of dealerships? Could other automakers eventually go the Tesla route and start selling direct?
I mean you can already go online and build and price out a vehicle but must take delivery through a dealership. This is a huge shot over the bow to dealerships. They should be very concerned that their days are now numbered.
I could easily see car deliveries being direct and the old dealerships becoming nothing more than service centers. Really no need for a sales department. Which if they make as little on new car sales as they claim this could be a good change for them too.
January 22nd, 2020 at 8:41 am
https://www.autonews.com/sales/tesla-reaches-deal-clearing-way-michigan-service-centers-report-says
Long overdue. Hope I can at least test drive one soon without having to drive 180 miles to Cleveland!
January 22nd, 2020 at 8:45 am
51 I don’t know if the car companies want to sell cars directly, but I’d think they might like to, at least in some markets. It would seem that there will always be a need for dealerships of some sort, because people want to see and test drive cars, and many want to trade cars, and not sell their used car using craigslist, etc.
Indiana, and I’m sure many other states give an extra “perk” to dealers over private sellers of used cars, in having sales tax on the difference if you trade a car, while you pay tax on the whole price of the new car, if you sell your old one privately.
January 22nd, 2020 at 8:47 am
52 “…Similar battles
In the 2016 lawsuit, Tesla said it was being stymied by automakers and dealers in Michigan. It’s been waging similar battles in Texas and Connecticut for a license to sell directly to consumers, arguing that it doesn’t violate dealers’ rights because the company doesn’t have any dealers.
In 2016, Diarmuid O’Connell, then Tesla’s vice president of business development, accused GM of pushing legislation that would keep its direct-sales model banned in Indiana. Tesla now has two stores and one service center in the state, according to its website.”
January 22nd, 2020 at 8:49 am
53 Tesla’s game is the max vertical integration it can achieve. They want to own their own dealerships and service centers and avoid the middleman and add to their revenues and profits.
January 22nd, 2020 at 8:56 am
52 From the autonews article, “Customers will still have to title their cars in another state and transfer them to Michigan.” That sounds like a hassle, and might be expensive, but what’s happening certainly sounds like an improvement over the way it has been.
January 22nd, 2020 at 8:56 am
https://www.autonews.com/mobility-report/bloomberg-wants-all-new-cars-be-evs-2035?utm_source=daily&utm_medium=email&utm_campaign=20200121&utm_content=article4-headline
Finally, one of the 25 dem candidates (none of the ones in the debates) addresses BEVs and wants all new cars to be BEVs in 15 years.
January 22nd, 2020 at 8:58 am
56 In my town, which is by no means typical of the state, the obstacles don’t seem to have worked, I see a ton of mostly Model 3s on the roads lately. Tesla has a “gallery” in Troy, about 40 miles from here, but I don’t know if you can test drive their demos. At this point, a test drive is what I need.
January 22nd, 2020 at 9:01 am
https://www.autonews.com/mobility-report/bloomberg-wants-all-new-cars-be-evs-2035?utm_source=daily&utm_medium=email&utm_campaign=20200121&utm_content=article4-headline
Wonder how he defines a family of “moderate” income. He did not say what specific $ incentive he’d give them, either. But wanting all new cars to be BEVs in 15 years is quite radical. The rabid socialist candidates had said nothing about this topic.
January 22nd, 2020 at 9:08 am
I brought with me a Mercedes booklet published in 2005 and has the numbers for the 2006 model year:
E320 CDI (in 2007-8-9 called E320 BLUETEC)
201 HP 3.2 lt (mine were 3.0 lt but still called CDI, and had 208 HP) 369 lbft (I think mine had 398 despite the smaller displ) and 5-sp tranny (both of mine have the 7 sp auto)
Acceleration of the 2006 was 6.6 ” 0-60, “based upon AMCI’s test track results and may vary depending upon model, envir. and road surface conditions, driving style, elevation and vehicle load”
For comparison the top E class model, the E 55 AMG in 2006, had 493 HP and 0-60 in 4.5 sec, this one based on manufacturer’s own track results
January 22nd, 2020 at 9:09 am
54 Tesla has only one real store and service center in Indiana, and one “showroom” in an expensive Mall. Both are in Indianapolis. From the Tesla site, there are no stores in Kentucky, and only 3 in Ohio, none in Toledo which would have been useful for people in the Detroit area. I guess the central US is not a hot spot for Tesla, even in states where they have been allowed to sell.
January 22nd, 2020 at 9:17 am
59 I suspect “driving style,” as in brake torquing it, as opposed to just flooring it from idle, has a lot to do with the difference between AMCI, whoever that is’s test, and CR’s significantly slower number. Either way, that’s pretty good acceleration for a ~4000 pound car of that era, that will get mid 30′s highway mpg, and probably about 40 at lower speed.
January 22nd, 2020 at 9:30 am
53 The used car companies have already established a business model that delivers cars to your home. If you don’t like it they will come pick it back up and deliver something else. So you can still test drive the car.
So really what do you need a dealership for? To remove the plastic covers on your seats?
I could easily see that to be the future of car sales. Just get online order it directly from the manufacturer who then delivers it to your home.
January 22nd, 2020 at 10:06 am
62 Dealers have test drives of new cars, take trades, do warranty work, and do non-warranty work, but at too-high prices in many cases. The used car delivery thing will work for people who want to buy a used car, and don’t want to trade a car, or maybe they do trades. It seems that, at least for now, dealerships or something similar serve a purpose. Even Tesla reversed course on closing all their stores.
January 22nd, 2020 at 10:48 am
63 Oh I’m not saying dealerships will go away. I think they will become more a service center and maybe even a place to pick up a new car and drop off a trade. But I could see the manufacturers going to set pricing offered online and where consumers no longer deal with a salesperson. I think most folks would be perfectly fine and better yet it would make comparative shopping much easier. Takes out dealer incentives (and mark-ups). The price is what it is and they could roll a dealer fee into the destination charge. Every dealer gets the same amount for each car that goes through their door.
January 22nd, 2020 at 10:54 am
64 Cont- This would actually be better for the dealership too. They no longer need to pay for a huge piece of property to store hundreds of cars. They don’t need to carry huge inventory other than a few test vehicles which would probably lower their insurance.
They say they don’t make hardly any money on new car sales so if they are getting a couple hundred per transaction. Then they also don’t have cars on the lot that need to discount that no one wants.
January 22nd, 2020 at 11:39 am
The interest expense of huge inventories of cars amounts to many millions of dollars a year, but what is the alternative? If everyone ordered their cars, as I did with my Corvette, there would be no dealer inventories, but assembly workers would be told to come to work, or not, on a day-by-day basis, depending on what cars were ordered the day before.
65 I guess all inventory could be stored in fields at the assembly plants, rather than at dealers, which would eliminate the need for dealers to store cars. That might work well, if cars could be delivered to the sales outlets in a short period of time.
January 22nd, 2020 at 11:49 am
65 Should inventories of cars be stored in fields at the assembly plants to be delivered to dealers/stores to order? That would eliminate the need for inventory at dealers, but someone would still need to cover interest on the value of the inventory, and people would need to wait a few days to get the car they want. Maybe everyone wanting a new car could order cars, like I did with my Corvette. It would take a few weeks to get the car, and assembly plants would need to have employees come to work on a day by day basis, depending on what cars were ordered the day before. There is no simple “best” way to sell, store inventory, etc.
January 22nd, 2020 at 5:30 pm
Jeep sales are down because IMHO we have been over Jeeped. Buyers are waiting for the Bronco and other cool vehicles like the Hummer. Plus manufacturers have to stop wanting year after year growth and be pleased with the annual sales they are currently getting. The pie is only so big.