February 16th, 2010 at 12:40pm
A recent survey indicates that Chevrolet is the second choice of consumers after Toyota. Ford is cutting a shift from its Auto Alliance International (AAI) plant in Flatrock, Michigan, where it builds the Mustang and Mazda 6. BMW is temporarily parking its long-running tagline in favor of something new. All that and more, plus John comments on America’s energy policy.
Transcript and Story Links after the jump . . .
Here are today’s top headlines. Most Toyota buyers say Chevrolet would be their second choice. Chevy comes out with an $8,000 car for China. And then we’ll talk about how to get off OPEC oil.
Up next, we’ll be back with the news behind the headlines.
This is Autoline Daily for Tuesday, February 16, 2010. And now, the news.
WWJ Newsradio 950 is reporting that Ford is going to cut one of the shifts at its assembly plant in Flat Rock, Michigan, cutting nearly 900 jobs. That plant builds both the Ford Mustang and Mazda6. Ford says it is doing this to bring supply in line with demand. Interestingly, the Mustang has a 107 day supply in the field, compared to 81 days for the Mazda6. The Mustang seems to feeling the heat from the Camaro, which has a 64 day supply. The Mazda6 seems to be in line with its competitors, because the Honda Accord has the same level of supply.
Lots of news for Indian automaker Tata. First off, the company announced that Carl Peter-Forster will become its chief executive. He had been at Opel, but stomped off in a huff when GM reneged on its deal to sell Opel to Magna and Sperbank. The Wall Street Journal reports that Tata will also get $75 million from the Indian army to build 1,000 bullet-proof trucks. Tata’s global sales also jumped 93 percent last month, including a doubling of sales at Jaguar and a tripling at Land Rover.
Few advertising taglines are as well-known as BMW’s. “The ultimate driving machine” is one of the auto industry’s longest-running slogans, but the Wall Street Journal reports that the company is parking its iconic catchphrase for a while as Americans tighten their belts. BMW has started a new campaign that focuses on safety, quality and the “joy” owning its products. In a change of strategy, it uses photos on real owners and their vehicles. In the past its ads focused on just the cars. The advertising push is the most expensive one ever fielded in the U.S. by a German automaker.
Speaking of automotive ads, Chevrolet seems to be making big headway. According to The Auto Channel, a recent survey indicates that 80 percent of Americans would consider buying a GM, Ford or Chrysler vehicle. An overwhelming 48 percent said Chevy would be their top pick after Toyota. Only 17 percent would choose a Ford and 14 percent a Chrysler. Still, the Detroit three topped the list, beating Hyundai, Honda and Nissan. Even though they’re not popular with critics, to me it looks like the Howie Long ads are working for Chevy.
In a nod to the growing popularity of social media websites, Citroen premiered its Geneva concept car on Facebook (subscription required). Ward’s reports that the DS High Rider is a hybrid coupe with a compact footprint. It’s just 68 inches long, 72 inches wide and 58 inches high. It features a diesel engine that powers the front wheels and an electric motor that drives the rear wheels.
According to Reuters, last month in China, GM launched the Chevrolet Sail which starts at $8,300 and runs up to $10,000, the first foreign automaker to dive into the market for inexpensive cars. Ford, Hyundai and VW will likely follow suit. Kind of interesting that while China’s domestic brands are looking to go upscale, its foreign competition wants to get into the low-end of the market.
In other GM news, Bloomberg reports, that CEO Ed Whitacre says the company has cut $10.7 billion in costs. The money will be used for marketing and to update models.
Car sales were up nearly 13 percent last month in Europe. According to Bloomberg, sales hit 1.09 million units but the growth declined from December due to the phasing out of cash-for-clunker-like programs in some of the countries.
Wouldn’t it be great to tell OPEC to take its oil and shove it? That’s the subject of my editorial this week, and that’s coming up next.
General Motors is calling for more E85 stations being available in the United States. It says it’s spending $100 million a year making nearly half of its vehicles E85-compatible, but not enough motorists are taking advantage of the capability. Today there are about 2,200 stations that sell E85, but GM says there needs to be 12,000 stations. That would make ethanol available within two miles of where all drivers live.
Just last month Ricardo, the engineering firm that develops powertrains, unveiled what it’s calling an EBDI engine, or ethanol-boosted direct-injection engine. It can boost fuel economy by 30 percent, essentially wiping out the drop-off in fuel economy typically comes from using ethanol.
Many people are unaware that ethanol is has an extremely high octane rating, typically over 105, while high-grade gasoline rarely exceeds 93. Engine builders can take advantage of the higher octane to raise the compression ratio, which improves the thermodynamic efficiency of an engine. It also allows them to run higher boost pressures. That’s how Ricardo is making an E85 engine get the same or better fuel economy than a gasoline version with no loss in power.
I think ethanol is a quick ticket to getting off OPEC oil. Let me make the math simple. The United States imports roughly half of all the oil it uses. And about half of that imported oil comes from OPEC countries. The other half comes from good neighbors and allies like Canada, Mexico, and Norway.
So that means roughly 25 percent of all the oil we use comes from OPEC, a cartel dedicated to controlling the price and supply of oil. Interestingly, the Department of Energy says the United States should be able to produce about 25 percent of its transportation fuel from biofuels, including ethanol and biodiesel.
To me, that should be our short-term energy goal, and the first step in a new energy policy for the country. Let’s get off OPEC oil within the decade.
And that’s it for today’s top news in the global automotive industry. Thanks for watching, we’ll see you next week.