Episode 104 – Buick & Jaguar Take Top Honors, Fiat’s Two-Cylinder Engine, Bonehead Bonuses

March 19th, 2009 at 12:00pm

Runtime 7:29

J.D. Power came out with its Vehicle Dependability Survey and the top brands are Buick and Jaguar. Fiat is coming out with a two-cylinder engine for use in its 500 mini car. Chrysler is thinking of paying $20 million in executive bonuses with taxpayer money. All that and more, plus some of John’s thoughts about driving the Ford Fusion hybrid.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. Buick and Jaguar take top quality honors. Fiat is coming out with a two-cylinder engine. And Chrysler is thinking of paying bonuses with taxpayer money.

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

This is Autoline Daily for Thursday, March 19, 2009. And now, the news.

J.D. Power came out with its Vehicle Dependability Survey, in my book, the best publicly-available quality ranking available. It measures quality after three years of ownership. And the top brands are Buick and Jaguar, tied for first place. Lexus is in third, the first time it has not been at the top. Then come Toyota and Mercury. The bottom five brands with the worst quality are Suzuki, in last place, then Volkswagen, Land Rover, Isuzu and Mazda. We have a link in our transcript where you can find the full list of quality rankings.

The Wall Street Journal reports a bill has been introduced in the U.S. House of Representatives to provide car buyers with vouchers for $3,000 to $7,500 to buy a new fuel-efficient car. To qualify buyers would have to scrap and recycle a car that is at least 8 years old. The vehicle they buy would have to get 27 miles per gallon for a car or 8.7 l/100 km, and 24 mpg for a truck, that’s 9.8 l/100 km. The better the fuel economy, the bigger the voucher. House Speaker Nancy Pelosi and the Obama Administration favor the concept, greatly increasing the chances it could be enacted. But the proposal, which only gives vouchers for cars made in North America, is also generating controversy.

Fiat is readying a small-displacement, two-cylinder engine for use in its 500 mini car. The Detroit Free Press reports that the 900cc power plant kicks out 85 horsepower when fitted with a turbocharger or 65 without one. That may not seem like a lot of power, but it should be plenty for the 500 only which weighs 1,900 pounds. Fiat hasn’t said anything about fuel economy, but you can bet it’ll deliver some amazing mileage. Production of the engine is expected to start next year.

The much-hyped Chevy Volt is expected to go on sale in November of next year. It’s not even close to being launched yet, but the Detroit Free Press reports that GM is already working on second and third generations of the extended-range electric. One of the goals of the program is to make the technology more affordable. The first generation Volt is expected to cost somewhere around $40,000.

Despite the recent uproar over AIG executives receiving bonuses, Chrysler plans to pay its executives $20 million in bonuses. According to WWJ, the bonuses were negotiated in 2007 when Chrysler was still a part of Daimler and meant to keep them from leaving. The Dean of the House, Congressman John Dingell, a major supporter of the auto industry warned Chrysler to “think long and hard” before awarding those bonuses. What are they thinking?

Monday we reported Fiat set up a joint venture with Chinese automaker Guangzhou to produce cars in China. Now, according to Reuters, Chinese automaker Chery has postponed a similar agreement with Fiat due to the economic downturn. The joint venture was scheduled to start production later in the year.

Coming up next, some of my thoughts about driving Ford’s latest green model, the Fusion hybrid, we’ll be back right after this.

Oil prices are cheap, for the moment. Even so, Ford just brought its new Fusion hybrid to the market. The company is touting the car’s efficiency, boasting that it tops the Toyota Camry hybrid by eight miles per gallon in the city. Here are some of my thoughts about the car after driving one from the press fleet.

Hopefully I’ll get another chance behind the wheel of Ford’s latest hybrid when the weather here in Michigan gets a little bit warmer. I’m anxious to see if I can meet or beat its city fuel economy rating of 41 miles per gallon. If you want to see more of my thoughts about the car, check out the John’s Journal page on our website, we’ll have another video posted there shortly.

Anyway, that’s it for today’s top news in the global automotive industry, except for this public service announcement.

18 Comments to “Episode 104 – Buick & Jaguar Take Top Honors, Fiat’s Two-Cylinder Engine, Bonehead Bonuses”

  1. Zieke Says:

    I would have expected about as much from Chrysler after they hired Nardelli. Is’nt he the same one that screwed up Home Depot? What is Chrysler thinking? They have bankruptcy written all over them, and deservedly so!!! Bonus, my ass. These people are NUTS…

  2. Alex Kovnat Says:

    Today I am writing not about any of the news items mentioned above, but about something I need to get off my chest.

    Last Monday there was a tragedy in Roseville, Michigan in which four teenagers were killed in a crash caused by a drunk driver. The culprit, a 47 year old woman from Mt. Clemens, was hardly injured at all.

    Over the years, there have been many instances of drunk drivers killing people, sometimes whole families, while hardly suffering the least injury to themselves in the process. Why is this so? In our efforts to make cars safer for drivers and passengers, is there not the possibility that we are enabling drunk drivers by removing what might otherwise be the natural consequences of their behavior?

    I believe that anybody convicted more than once of driving under the influence of alcohol should not even be allowed, let alone required, to have air bags in their cars nor even things like seat belts or energy-absorbing steering columns.

  3. pedro Fernandez Says:

    John, your show is so informative and you always give last minute news. I’m happy to see this bill finally might get approved, the only problem is they need to clarify which cars qualify, would a foreign brand built here? How about an Aveo, american nameplate built in Korea? and as far as American cars that get enough mpg’s? Frankly there are not that many. Also, does it matter what your income is? I don’t think wealth people should qualify they don’t need it. I can finally put my 20th century car out to pasture. I’m also shocked at Jaguar’s quality improvement, in th old days they were horribly unreliable!

  4. jim Says:

    The sad fact is that when I was growing up in the 60s and 70s, business executives routinely drove Buicks. Today, business executives drive BMW, Lexus or Audi. Most wouldn’t be caught dead in a Buick, no matter how good the ratings are. Buick needs to get a person in charge who knows how to design a car. The best thing GM could do is get rid of the dolt who is the senior in charge of styling. John had him as a guest about a year ago and it became clear to me rather quickly why there are so many dull looking cars in GMs lineup.

  5. pedro Fernandez Says:

    Sorry, I misread the mpg’s required in the proposed bill, its 27 hwy for cars, that’s not very high. I think they should increase that number if they really want to improve both the oil use and pollution situation, but that also means a lot more vehicles would qualify for the rebate.

  6. Richard Tait Says:

    Frankly, I don’t see anybody who is currently at Chrysler worth keeping for free, let alone keeping for $20 million. The best thing that can happen is to NOT pay them, let them leave and hire a group of high school auto shop and economics students instead. You would get cars that real people want and the money to build them with.

    @Alex Kovnat: Friend, I feel the same way you do. We have managed to successfully eliminate cigarette advertisement from tv, radio and in print and have basically had the public sold on how dumb an idea smoking is. Yet, a person who smokes a pack of cigarettes doesn’t get into a car, lose control as a result and kill 4 kids. Morons who drink and drive do. Yet, we still see the ads on tv, hear them on the radio, and read them in print. You know the ones…where all these cool gorgeous looking people have a glass in their hands telling you to drink responsibly. Hypocrites. While I don’t support a ban on alcohol, I do support higher and higher and higher taxes until we start to see Courvoisier, Hennessy, Anheuser-Busch, and the rest of them use their alcohol for some good for a change. E100 here we come!

    @Jim: Buddy…have you left your house since 1995? GM cars are currently some of the more attractive on the road thanks to this “dolt”. Edward T Welburn Jr (Vice President
    Global Design) has given us vehicles like the Solstice, the Enclave, the new Malibu, the current Cadillacs, the upcoming Buick LaCrosse, the Cruze, the Volt…the list goes on and on. GM surely was doing wrong things in the past, but seems to be doing a lot that is right today. The problem is that its past has caught up with it and it really has run out of time. Convincing people that GM does make more than just competitive vehicles is an uphill battle. If you can, see what Jeremy Clarkson (BBC’s Top Gear) recently said about America’s ability to build a sports car. His answer is amazing to say the least.

  7. jeff mohr Says:

    Chrysler llc executives will dig themselves into a deep hole by taking millions in bonuses—forget about retaining “top talent” we all know better—-they should just get 200k salary per year take it or leave it, we can promote from within, there are plenty of people with bachelor and/or masters degrees with “on the floor experience” though out the company to fill in–the truth is probably do better. jmohr— kenosha engine plant

  8. Dan Clemons Says:

    Congratulations to David L. Buick! That is a very nice honor indeed!

    I can understand why Suzuki is dead last. The build quality on our Aerio is very poor. Both side door mirrors flap in the breeze. It is a real sight to behold.

    Until the economy improves there should be no bonuses.

    I enjoyed your show ending today!! You people do good work!

  9. craigerzgt Says:

    At first glance, it appears as though Chrysler is nuts for giving out bonuses. However, I wonder what the reprecussions are to not paying out the bonuses as per the previous agreement to do so. Sure, a court would likely award in Chrysler’s favour, but could Chrysler even afford to go to court over this? Something to think about, even though it’s an unpopular viewpoint.

    @Alex Kovnat: I honestly believe that there shouldn’t be any tolerance for people that are arrested for DUI. The consequence for first-time offenders should be a termination of their driver’s licence for a good-size term, maybe 2 years or more. There should be a signal sent to the public that if you are DUI, you will be punished severely. There’s no excuse for that behaviour and it should be greatly reduced if not eliminated.

    @ pedro Fernandez: There’s even more of a question of what defines a North American-built car. There’s cars that are built in NA, cars with NA-nameplates, and then cars with parts that were made in NA. Where do you draw the line? Obviously 100% foreign vehicles are out, but what about the vehicles with NA-built parts? They were made here, which generated salaries and therefore NA GDP. Is that not considered?

  10. Don MacConnel Says:

    Replace the cash bonuses with incentive (ISO) stock options. That might shut up the dissenters and also let us see which execs are going to stay around.

  11. David Says:

    Why do you think 35MPG is not close enough to 41MPG for the 2010 Ford Fusion Hybrid? No were near 41MPG means to me like 25 to 30MPG! 35MPG seems reasonable!

  12. pedro Fernandez Says:

    Is Mexico now considered NA, if so then a German brand made in Mexico would qualify for the voucher, that doesn’t make sense to me. A foreign nameplate assembled here with mostly American made parts, should surely qualify. Currently the most fuel efficient American nameplate: the Chevy Aveo is built in Korea so it would not qualify. This is pretty confusing, but then again it’s the congress, what do you expect?

  13. Ron Patenaude Says:

    John it seems like the office enviroment follows you everywhere.Turn the heater off in a hybrid so that the engine won’t maintain cabin Temp.you desire and the fuel numbers will increase.Glad to see that at least your interested in helping the enviroment and not just worried about the cost of fuel.A few more trips in a hybrid and guess what,you will automatically change driving habits.Now that your hooked stand at the front of the class and tell everyone how much fun this really is.Don’t forget to thank Toyota for brining this to the fore-front.Ron

  14. John Says:

    “To qualify buyers would have to scrap and recycle a car that is at least 8 years old. ”

    John McElroy, is this the literal meaning of the bill?

    “scrap and recycle” = destroy ?

    I hope the classics in the wrong hands don’t go down the hopper.

  15. Denis Says:

    Unfortunately J.D. Powers is biased. They create an award and then get hired by the automakers for consulting/coaching on how to win the award. Sort of self serving don’t you think? The Automakers need to focus more on real consumer/buyer experiences. Not created/fabricated awards. Less “Preceived Quality” and more “Real Quality”

  16. pedro Fernandez Says:

    Folks, if we can’t trust JD or Consumers Report, who are we to believe? car ads, execs tooting their own horns, or car mags like MT who named the Vega car of the year back when.

  17. Bill Murdock Says:

    Corporations should definitely rethink “retention” bonuses. In the current economy, all most companies have to do to retain employees is simply not fire them.

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