Marketing Powertrains Becomes Trickier

Marketing Powertrains Becomes Trickier

By Michelle Krebs February 14, 2008

By Dale Buss

Back in the good old days, when an engine was still an engine and not some fuel-sipping mockery of locomotion, Chrysler dusted off its Hemi tradition, gussied up a powerful new V8 and wrote a great chapter in sub-branding history by promoting its robustness. Consumers went nuts from 2002 through 2006 selecting the 5.7-liter option and turning "That thing got a Hemi?" into a cultural touchstone.

What a difference two years and $3-a-gallon gasoline can make. Nowadays, Chrysler still touts the Hemi. But it is repositioning the iconic engine brand into a platform for powertrain diversity that notably includes a version that boosts fuel economy by shutting down half of its cylinders at cruising speeds.

"It was a very unique opportunity for us," said Mike Accavitti, director of Dodge marketing and communications for Chrysler. "Now consumers say, 'It's got a Hemi,' but they don't necessarily think of it as a gas-guzzling engine."

Automakers are attempting more such marketing sleights of hand these days as American consumers increasingly bounce between their continued desire for ample engine power and the gnawing imperative to obtain greater fuel economy in their new wheels. For some buyers, the answer is to pony up a few thousand dollars more for a hybrid or clean-diesel powertrain, or to wait until fuel cells and other cutting-edge propulsion concepts make their way out of concept cars and into showrooms.

But to help the vast majority of auto buyers resolve their current dilemma, car companies are squeezing more power and up to 20 percent better economy out of the traditional internal-combustion engine with direct-injection technology, turbo boosting and other means. Then they're building marketing positions around their innovations, usually only hoping they can attain the same kind of success in the new era that Chrysler did a few years ago with the Hemi.

EcoBoost Will Tout Quick Payback

Ford's gambit may be the most ambitious from a marketing perspective. The company announced in January it is introducing EcoBoost, which it calls a new "affordable engine technology" it says will deliver 20 percent better fuel economy on a half-million Ford, Lincoln and Mercury vehicles annually during the next five years, beginning with the new Lincoln MKS sedan in 2009.

The EcoBoost family of four- and six-cylinder engines features both turbocharging and direct injection, boosting fuel economy, the company says, without hurting performance. "EcoBoost is meaningful because it can be applied across a wide variety of engine types and vehicles, from small cars to large trucks -- and it's affordable," said Derrick Kuzak, Ford's vice president of global product development.

Ford isn't yet saying exactly how much extra an EcoBoost option may cost a consumer. But it says a purchaser could expect to recoup an initial investment in a four-cylinder EcoBoost engine through fuel savings in about 30 months. That compares with an average of seven years with a diesel in North America and nearly 12 years with a hybrid, Ford said, given equivalent miles driven and fuel costs.

It remains to be seen how much Ford will actually do to market EcoBoost or whether it will perhaps try to create a meaningful sub-brand out of the technology. The name itself is a clever attempt to address consumer interests and concerns about both fuel economy and performance. But the history of powertrain branding is littered with names that never achieved meaningful traction.

Pondering Powertrain Brands

And with the exception of Ford, automakers for the most part still haven't figured out how to proceed with powertrain sub-branding in this new age.

Nissan executives, for example, "have had a lot of discussion about technology  naming," said Larry Dominique, Nissan North America's vice president of product planning. "If you're not careful, it can be overwhelming." The company "certainly is going to be introducing powertrain variants that will be more sustainable and environmental," he said, "but how we decide to market those things is still kind of fuzzy."

In advertising the V8 engine for its Titan pickup truck, for example, Nissan has trademarked and uses the name Endurance, hoping to underscore its muscle as the model penetrated the machismo segment that has been dominated for decades by Detroit's Big Three. But Titan hasn't sold as well as Nissan had hoped.

As Nissan ponders further similar sub-brands, Dominique said, one complication is different global markets call for unique strategies. Diesel is huge in Europe, for example, but a diesel sub-brand likely would be applicable only there, while Nissan is dealing with a U.S. market that so far, at least, seems more interested in hybrids as an alternative propulsion system.

"There's a likelihood we'll end up choosing marketing names for some of these (powertrain) technologies down the road," Dominique said, "but we want to make sure they represent something substantive that is of real benefit to the consumer."

In the late Eighties, Honda both capitalized on and enhanced its reputation for powertrain-engineering savvy by introducing and sub-branding the VTEC -- for Variable Valve Timing and Lift Electronic Control -- engine. "It was the best of both worlds," said Rob Keough, senior product planner for American Honda, "because you could get a lot more power and sporty feel out of a small-displacement engine."

But Honda has allowed VTEC to fade as a sub-brand and, with fuel-economy concerns becoming paramount, has chosen to focus on promoting the variable cylinder management capabilities of its engines. In fact, the latest version -- which can run an engine on three, four or six cylinders -- just became available on the 2008 Accord compact and is a feature of the next-generation 2009 Pilot SUV due out this summer.

Honda certainly is promoting its version of variable cylinder management but has no plans to fashion it into a sub-brand. "There are so many other attributes of our vehicles that need to be promoted as well," Keough said.

From Northstar to 'Efficient Dynamics'

General Motors began the modern era of powertrain branding in the early Nineties with its Northstar family of V8 engines, an all-aluminum innovation. It beat out both Mercedes-Benz and BMW in horsepower per liter of displacement, fuel economy and required maintenance, and so, marked a quantum leap for American powertrains. Initially Northstar appeared only in certain Cadillac models but then later spread to other large GM cars. A badge on the rear of the vehicle often marked its presence, and it was a huge factor in much GM advertising until a few years ago.

Nowadays, however, though turbocharging and direct injection are sweeping through GM's vehicle lineup, the company has no apparent plans to try to re-create the success of Northstar with another engine sub-brand.

And at BMW, the idea of creating a sub-brand of powertrain is actually anathema, because it would subvert the essential idea that BMW itself is synonymous with engine perfection. "The concept of marketing powertrains is not something that we are aggressively going to get behind," said Jack Pitney, BMW's vice president of marketing in North America. "First and foremost, people buy 'BMWs.'"

Still, for several years BMW has been promoting an engine-related sub-brand of sorts: Efficient Dynamics. Pitney said it is an “umbrella powertrain-development philosophy” that seeks to make BMW engines more efficient – through optimizing technologies including high-precision injection and brake-energy regeneration – and cleaner. U.S. consumers are likely to begin hearing more about Efficient Dynamics, Pitney said, as BMW begins to penetrate the North American market with diesel engines that have been it staples in Europe.

And in Europe, Japan and China, he said, consumers seem to understand what Efficient Dynamics means even though "there's not high awareness of the term" per se. "People know intuitively what we're trying to communicate," Pitney said. "They say that it must mean improved fuel economy and environmental performance -- which is, actually, what it's all about -- while at the same time protecting the joy of driving. It's a term that says you get to have your cake and eat it too."

Stretching What Hemi Means

Hemi has become the success case study in this genre over the last several years. Chrysler did such a good job of reviving its Fifties performance brand in new pieces of hardware a half-century later that the redneck "Hemi Boys" are still gracing TV-advertising viewers with their presence. But over the last couple of years, spiking consumer worries about fuel economy have rapidly caught up with their appetite to have a ravenous Hemi that would impress on the basis of raw power alone.

So when Chrysler recently began fielding its Multi-Displacement System (MDS) on the 5.7-liter Hemi to offer consumers a fuel-saving option, it faced a marketing dilemma: Create a new brand for the technology or somehow make the Hemi image also fit this new attribute? Chrysler dabbled with the idea of creating another engine brand but quickly settled on flexing Hemi.

"To come up with a different name, we'd have to explain to consumers what it is and give them yet another new message," Accavitti said. "That would be a lot to swallow. We could have done it, but we would have had to spend a lot of money."

So instead Chrysler has refocused on trying to expand Hemi's message to include a mileage-friendly aspect. "Because Hemi has so much equity we didn't have to spend a lot of money and effort explaining what the Hemi is, and we have been able to dedicate that time in our advertisements speaking to the MDS -- that consumers could have Hemi power when they need it and that the engine deactivates four cylinders when they don't need them," Accavitti said.

Chrysler claims its own consumer research shows the approach has worked, though numbers show Hemi installations dropped to 38 percent in 2007 from a high of 67 percent a couple years ago. "People believe they can have their cake and eat it, too, with the Hemi," Accavitti said. "Hemi awareness is high, and consumers associate Hemi with power and performance, which is great, but not necessarily with poor fuel economy, which is also great."

In fact, Chrysler is even unapologetically planning to attach the Hemi name to the new hybrid powertrain that will first appear on the Dodge Durango later this year. "We'll market that as the best of both worlds to people who need torque and power but who also are looking for a greener solution," Accavitti said.

Michelle Krebs:  is Editor-in-Chief of AutoObserver.com. Follow @AutoObserver on Twitter.