Episode 698 – Market Woes = Profit Warning, Shockingly Fast Toyota, HD Gets CAFE Treatment

August 9th, 2011 at 11:36am

Runtime: 6:41

As market woes continue, expect automakers to lower expectations — especially the Japanese companies. Toyota plans to smash the EV lap time at Nurburgring hoping it will stir up more excitement for green technologies. The Obama Administration turns its focus toward reducing emissions from heavy-duty vehicles. All that and more, plus we put the new eAssist technology in the Buick LaCrosse to the test!

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This is Autoline Daily for August 9, 2011. Here are the most important developments affecting the auto industry right now.

MARKET WOES = PROFIT WARNING
The worldwide drop in stock markets has got automakers worried. While car companies have not yet lowered their sales or production forecasts, several have said they now expect sales to come in at the lower range of what they had been predicting. However, Honda says it may downgrade its profit forecast if the stock market turmoil continues. As the dollar continues to weaken against the yen, Honda will see a drop in profits even if sales do not decline. Honda, like Toyota and Nissan, rely on the American market for most of their profits. Bloomberg reports that for every one yen gain against the dollar, Honda’s profits drop by $190 million.

HEAVY DUTY CAFE RULES
On the heels of boosting CAFE to 54.5 miles per gallon for cars and light trucks, the Obama Administration is now targeting heavy-duty vehicles. Semi-trucks will have to cut fuel consumption and greenhouse gas emissions by up to 23 percent. Gasoline powered heavy-duty pickups and vans must cut consumption by 10 percent, or 15 percent if they run on diesel. Fire trucks, garbage trucks and buses have to reduce consumption by 9 percent. The targets are expressed in percentage gains, not miles per gallon, because it would be too confusing with so many variants of these vehicles. The new standards start in 2014 and run through 2018.

QUIRKY CODES FOR NISSAN
You’ve seen these Quick Response codes before, haven’t you? Called QR codes for short, these weird-looking codes are popping up everywhere in advertisements in magazines or newspapers and even billboards. You just scan it with your smart phone and it will provide you additional information about the product. Now Nissan will be putting them on the window stickers of its vehicles all across its lineup starting with its 2012 models. The codes will provide more information on the vehicle, including video overviews, the latest incentives, dealer inventory, and they’ll even let you request a price quote.

SHOCKINGLY FAST TOYOTA
Toyota wants to smash the lap record for EVs at the Nurburgring with an electric race car. It wants to use motor racing to generate more passion for green technology. Currently, the record of the old Nordschleife track for electric cars is just a tick over 9 minutes, 1 second. But Toyota says it’s already unofficially broken that record in testing. I think that’s a great effort, but I wonder if it’s just a one-lap banzai charge, after which that electric race car needs to be charged up again.

SING ALONG WITH MITCH
The automakers in the US have a new lobbyist in Washington. Mitch Bainwol was the head of the Recording Industry Association of America, the lobbying group for the largest record labels. But now he’ll be heading up the Alliance of Automobile Manufacturers. The AAM had been headed up by former Congressman Dave McCurdy, who is now the chief lobbyist for the natural gas industry.

CAFE rules are going to force a lot more electrification of cars if automakers are going to hit those fuel economy targets. But maybe we’re going to see more mild hybrids instead of strong hybrids. More on that after the break.

Buick is posting some impressive fuel economy numbers with its eAssist technology that debuted on the LaCrosse. Autoline Daily’s Andrew Justus recently got a chance to put that technology to the test, and here’s what he found.

Thanks for that report Andrew.

Don’t forget to join us this Thursday night for a great Autoline After Hours. Our guest will be Ed Welburn, the head of global design for General Motors. Here’s your chance to get the inside scoop of where GM’s future design is headed and put your questions to the man himself. Join me and the Autoextremist, Peter De Lorenzo, for the best discussion of what’s going on in the industry on Autoline After Hours.

And that wraps up today’s report. Thanks for watching, we’ll see you tomorrow.

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35 Comments to “Episode 698 – Market Woes = Profit Warning, Shockingly Fast Toyota, HD Gets CAFE Treatment”

  1. LS ford Says:

    I was out yesterday so missed the great Lincoln discussion. Funny those concept cars from 1998-99 still are popping up over ten years later. Why did they not build them back then?? Same reason they won’t build them today…..

  2. LS ford Says:

    Based on stock markets and today’s trend? Doubt they will enven happen any more…

  3. W L Simpson Says:

    lobbyist employers are why we are broke

  4. Chuck Grenci Says:

    I am looking forward to AAH this week with Ed Welburn (I know Peter D. already has an early request, from Ed, for a sneak peak of the new Corvette C7). On that same theme, if I can request or maybe just hope, that Ed shows up with some pics of the new ATS and XTS from Cadillac; afterall they are due fairly soon and have been highly anticipated by the Cadillac crowd.

  5. tj Martin Says:

    I’m telling you folks , this RIAA guy you do not want having his hands in any aspect of the Automotive Industry .

    And just in case anyone should accuse me of again being a ” Know It All ” let me remind you the Music Industry has been my career since 1975 .

    The RIAA has done more to bring the Music Industry to its Knees of late ( even more so than the Download Debacle ) so don’t expect anything positive to come out of Mr Bainwol’s appointment .

    Oh this is gonna get real ugly . Question is , who’s brilliant idea was it to give him the job ?

    BAINwol . Yup ! That fits . The newest Bain to the auto industry
    :(

  6. tj Martin Says:

    @ Chuck Grenci

    C7 Corvette ?

    I though that was still in the designers heads !

    Did they finalize the direction of the new beast and I missed it ?

    Or are you just hoping ?

  7. tj Martin Says:

    Thought this worth repeating ;

    The song one of the Big Three should be using for their commercials ;

    John Hiatt – ” Detroit Made ”

    Enjoy !

    http://www.youtube.com/watch?v=n1XnRY01jL0

  8. GPL Says:

    “I’m telling you folks , this RIAA guy you do not want having his hands in any aspect of the Automotive Industry.”

    I agree, tj. Next thing you know new vehicles will come with Driving Rights Management. We won’t be able to loan our cars to anyone else.

  9. GPL Says:

    From yesterday: Who’s next?

    NHTSA is now investigating 2002-2008 BMW 7 series for “rollaway incidents” possibly caused by automated electronic convenience doodad failure.

    “The Office of Defects Investigation has received a complaint from a consumer alleging a rollaway incident with a model year (MY) 2006 BMW 7-Series vehicle after parking and exiting the vehicle. The complaint vehicle was equipped with BMW’s Comfort Access electronic access and ignition system and an electronic transmission shifter with the gear selector mounted on the steering column. The shifter is designed to automatically shift the vehicle to Park under a variety of conditions, including after the driver has pressed the ignition button to turn the engine off. Early Warning Reporting data submitted to ODI by BMW include field reports describing additional rollaway incidents in similarly equipped MY 2002 through 2008 BMW 7-Series vehicles.”

  10. Chuck Grenci Says:

    @tj #6

    Peter Delorenzo knows that the C7 is well into developement (and mentioned, on the last AAH, that he would drop a hint to Ed to bring some morsel of the next-next Vette).

    And yes, I’m just hoping (Peter knows something though).

  11. tj Martin Says:

    @ Chuck Grenci

    # 10 ….. +1

    I’ll be hoping as well ! God I hope they ( GM ) don’t screw things up with the C7 !

    @ GPL – Did you see the VW Jetta Diesel ” Who’s Next ” I tossed up this morning ? Leaking Fuel being VW’s ill .

    There seems to be a rush on this week from all corners of the Globe to get on the Recall/Investigations list

  12. tj Martin Says:

    Here’s the BMW and the VW articles ;

    http://wheels.blogs.nytimes.com/2011/08/09/n-h-t-s-a-opens-investigations-of-40000-volkswagen-jettas-and-120000-bmw-7-series-models/?ref=automobiles

  13. MJB Says:

    @9

    “…ROLLAWAY INCIDENT…BMW’s Comfort Access electronic access and ignition system and an electronic transmission shifter with the gear selector… designed to automatically shift the vehicle to Park under a variety of conditions, including after the driver has pressed the ignition button to turn the engine off.”

    I love innovation. But incidents like this give me the willies.

    I can’t wait to see what eventful string of (deadly) incidents it will take to trigger a government recall in another decade or two after we have started allowing our cars to ‘drive themselves’. Oh sure, there will be test and test after exhaustive test to prove the inherant safety and flawlessness of said systems. But it will only take one 85mph multi-car pile-up to make consumers eager to get back to the days when they controlled their own fate behind the wheel. Frankly, I don’t think we will ever get to the utopian world of Minority Report and iRobot where the cars do all the thinking.

  14. GPL Says:

    tj, I did. I thought I’d add the BMW to the list.

    MJB, one of the Google cars has already had a fender-bender.

    I just took a look at NHTSA’s recall lists for the last few months.
    http://www-odi.nhtsa.dot.gov/cars/problems/recalls/recallmonthlyreports.cfm
    They are eye-openers – cars, light trucks, commercial trucks, motorcycles, golf carts, recreational vehicles, motor coaches, travel trailers, flatbed trailers, fire trucks, cranes, commercial buses, school busses…and that was just July!

  15. Kit Gerhart Says:

    Hmm. My Prius has the same thing as that BMW. It automatically engages park when you push the start/stop button. So far, it has worked fine, and no recalls that I know of.

  16. MJB Says:

    @14

    Lot of stuff in those lists. I only cracked open one and my head is spinning.

    If we can’t get the simple stuff right on a consistent basis (and most of those items were simple), how are we going to ensure the level of perpetual perfection required to ensure safe travel in a setup of completely automated vehicles?

    Systems like that would require constant safety checks – much like those that are used in the aviation industry. Which means no more waiting until something breaks to drag one’s car into the shop to get it fixed. Vehicles would need nightly system checks to validate compliance with a whole new set of minimum safety criteria.

    Impossible? Probably not. Likely? Definately not.

  17. tj Martin Says:

    @ GPL

    Don’t get me wrong , I’m glad you did ( add the BMW to the list )

    And oh that link you just tossed up . If that isn’t good for at least a case of Excedrin Migraine , I don’t know what is ( shudder :( )

    @ Kit Gerhart

    So what say you in comparing a Factory Recall to an NHTSA investigation ?

    @ MJB – If you saw the Mustang recall you’ll know they can’t even get a bloody manual transmission right these days , never mind some computer driven , overly complicated function .

  18. Kit Gerhart Says:

    @tj, I haven’t really thought much about NHTSA investigations vs. factory recalls, except that if there is well-documented evidence of a problem. I’d rather see the manufacturer do a recall without being “forced” to do so, regardless of who initially found the problem.

  19. tj Martin Says:

    Ford Taurus revisited

    Well since it after hours and things seem to have died here ( everyone watching the market ? ) I thought I’d post a little more of my opinion about the new Ford Taurus .

    Like Kit, I don’t much care for it . Sure in its SHO guise its a bit of a runner , but in truth I find it to be far too bulky , way overweight , much like the 300C taking up far too much space with way too little interior room , as well as having gained a plethora of Blind Spots that the previous models never had .

    Fat , Bulky , Overweight and in Dire Need of Weight Watchers would be my summation .

    As far as one persons response to my post yesterday ( gt40 ) that the 300C was the most dramatic design to come out of Detroit in decades I’d take issue with that .

    Sure the 300C ( as well as the Dodge Wagon ) hit you like a brick when they first came on the scene . But like every other ” Trendy ” design attempt , the staying power of the 300C just is not there .

    When I first saw one it was ” Oh wow Chop Top Production American Custom/Hot Rod ”

    Now when I run across them is more like ” Fat boring pretentious ‘ Sopranos ‘ ‘Gangsta Rapper ‘ wanna be mobile ”
    Which pretty much sums up the majority of recent 300C buyers .

    So I’ll hold to my conviction that Ford using the 300C as a starting point for the new Taurus was to say the least a bad move .

    Especially in light of the fact that the 300C’s sales have been falling steadily for the last three years .

    Honestly Ford , I know for a fact you’ve got better designers on staff than the new Taurus would seem to indicate .

    Its about time you start using their abilities , rather than hem them in with such bad limitations .

  20. cwolf Says:

    So,Andrew Justus,does Buick eAssist gains outweigh the added costs?; My guess is not likely. And what were the increases in mpg for city/hwy driving? Kinda logical questions that you should have asked yourself,young fella!

  21. pedro fernandez Says:

    These reports look more like commercials than actual tests and reviews. That would have also been my #1 question, is it worth it and how much benefit vs extra cost????

  22. pedro fernandez Says:

    These reports look more like commercials than actual tests and reviews. That would have also been my #1 question, is it worth it and how much benefit vs extra cost???? BTW the Nissan code thing is just DUMB. my opinion, of course.

  23. cwolf Says:

    tj, glad to see market end on upswing,but it’s nothing to to bank on;tomorrow is another day for markets to yo-yo. The only news to enlighten me this A.M was the 5% drop in the Korean market. How evil of me! Just knowing everything they do is going to cost them more, just for a year or so, brings a smile to my face.

  24. GPL Says:

    I like the “look” of the new Taurus, but I haven’t been inside , so I’ll have to take everyone’s word for what the interior volume/blind spots are like. I don’t think anything was drawn from the 300C/Charger for it, though. Ford’s “kinetic design language” from their European product is evident, though awkwardly so, in the Taurus. It looks like a Mondeo skin stretched over the 500′s bones. Perhaps that’s the problem. Maybe the design language was ported haphazardly to the larger platform without regard to the difference in proportions…and blind spots. I wouldn’t be surprised if the project were fast tracked. That car went from 500 to Taurus to new Taurus rather quickly. Probably an act of desperation.

  25. cwolf Says:

    Thought it odd to see a few Sonotas on the hwy with dealer tags for what ever reason. Thought they looked pretty cool when they first launched, but now all those sharp lines are turning me off.

    I did’nt know Mustang trannys were Chinese!
    Hells-Bells man!!!

  26. tj Martin Says:

    @ cwolf

    Market Upswing ?

    More like the Financial Roller Coaster of the decade .

    Rest assured I’ve no confidence in todays little upsurge

    As to Mustang trannies being built in China . Aint that a real kick in the pants . Bad enough they’re built in China but its even worse the Chinese can’t build them right . Correct me if I’m wrong , but isn’t a manual transmission just about the simplest mechanical part of the drive train there is these days? .

  27. XA351GT Says:

    Like I said yesterday ,unless you are a very large person . There is plenty of room in the Taurus from when I sat in it. If styling gives blind spots , technolgy gives detectors for it ,plus there are still mirrors on cars although I have doubts some know what they are for. I’ll take one over the oversized shipping containers on wheels that every manufacturer is pushing down the throts of buyers.

  28. XA351GT Says:

    The 500 name change to taurus was a attempt to lure the millions of original Taurus buyers. Not giving them credit that a nmae change wouldn’t help the bland as hell Toyota wannabee styling. They basicly took the Interceptor show car and made it the Taurus. Look at the 2 cars you’ll see that way before the 300C. Now maybe the 300C was a inspiration the Interceptor , I don’t know . maybe John can ask the designer some time.

  29. Kit Gerhart Says:

    I don’t know how well CAFE will work for trucks, buses, etc., considering the, uh, checkered history for light vehicles, but there is a lot to be gained in efficiency of heavy vehicles. Garbage trucks and city buses, with their frequent stops, can benefit tremendously from hybrid technology, whether electric, or hydraulic-pneumatic. Many, or most tractor trailer rigs are much heavier than need be for the cargo they carry. They are built to carry a load of steel, which makes them much stronger and heavier than they need to be for a load of pillows. A while back, I read that WalMart was commissioning design of lighter more efficient 18 wheelers adapted to their needs, rather than the “do everything” capability of most of today’s equipment.

  30. Kit Gerhart Says:

    Regarding Taurus and 500, again, styling is certainly subjective, but in the case of these Fords, the “improvements” clearly made the car worse. The current Taurus has less cabin space, worse visibility, and is larger on the outside than the 500. That is not progress. The better power trains could have been used in the older, roomier car with good visibity. That would have been a nice package.

  31. Alex Kovnat Says:

    > HEAVY DUTY CAFE RULES

    Government has gotten totally out of control. Obama must go; and California must be brought to heel for the good of the country.

    This year we began observing the 150th anniversary of the Civil War. I believe California should not only be allowed to secede from the union, it should be cast out.

  32. tj Martin Says:

    Technology to deal with blind spots

    If the Blind Spots are there , its a major flaw in the design

    And what are you going to do when the technology fails ?

    This MYTH that good design require Blind Spots is at its best ridiculous ! The C6 Corvette , Bristol Fighter , McLaren MP4-12C , Acura NSX etc etc etc . All stunners . None with a major blind spot to speak of

    So again Blind Spots are the Result of poorly thought out and ill conceived Pretentious attempts at Design . There is no other excuse .

    Also my criticisms of the Taurus interior space are in relation to the size of its footprint . The total space taken up by the Exterior hardly justifying the comparatively minimal room in the Interior .

    @ Kit #30

    On this one we’re completely on the same page .

    @ Alex Kovnat -RE; California – +1

  33. tj Martin Says:

    What goes up …… must come down . the Stock Market that is .

    We’re in for one rough ride this time I fear . Along with the rest of the World

  34. GPL Says:

    I just compared the dimensions of the 500 and Taurus. For the front seats, the Taurus is about the same as the 500 inside, give or take a bit here and there, but the rear seats lost comparatively.

    The Taurus’ roof is an 0.8″ lower, so it’s no surprise it lost 0.4″ of headroom up front and 0.9″ in the back.

    In the hiproom, the Taurus actually gained more inside than it did outside. It is 1.7″ wider outside and gained 2.6″ in the front hip and 2.1″ in the back.

    The shoulder room is a different story, though. It only gained 0.1″ front shoulder room and LOST 0.7″ rear shoulder room. Why the loss of shoulder space? Did the designers really change the profile of the door panel that much for aesthetics? On the other hand, maybe it was for the sake of improved side impact protection – stiffer upper door or more padding. I don’t know. It would be intereting to find out.

    Here’s the REAL puzzler. The wheelbase didn’t change, and the front gained 0.6″ of legroom, but the rear LOST 3.2″ of legroom. I could see the rear losing what the front gained, but it lost several times what the front gained. Where did that space go?

    All totalled, up front, except for taller folks, the Taurus is an improvement over the 500, especially for those with wide asses, but the rear seat shrank disproportionately. Whether or not that is a problem, I guess, depends on the vehicle’s usage. Rear space is lost on me. I rarely have more than pint-sized rear passengers, but those that regularly haul other adults or taller teens might miss the space.

  35. XA351GT Says:

    @#32 againthis is why I said they STILL put mirrors on the cars. And all the cars you mention taht have no blind spots with exception of the Vette are all over 100K ,no?