One year after Toyota's highly publicized recalls, some car buyers are still avoiding the brand, according to shopping metrics provided by Edmunds.com.
In December, 17.9 percent of car shoppers considered Toyota vehicles -- 2.3 percentage points below levels seen in December 2009, before the 2.3 million-vehicle recall for potentially sticky accelerator pedals. Overall, Edmunds finds that 2010 consideration for Toyota vehicles was down about 3.8 percentage points year over year.
In 2010, Toyota was the only major automaker to see a drop in overall sales (-0.3%), causing it to lose its No. 2 spot in sales and market share to Ford. The decline came even as Toyota offered the highest year-over-year jump in dealer incentives, which were up 33 percent in 2010 from 2009, according to Edmunds.com.
"Toyota needs to overcome not just the PR damage sustained by last year's recalls, but also the reality that its models are stale," said Jessica Caldwell, Edmunds.com director of pricing and industry analysis.
Toyota Motor Corp. President Akio Toyoda attended his first-ever Detroit auto show - his first U.S auto show, for that matter - because he wanted to personally unveil the new variant of the Prius hybrid and announce the establishment of a safety research center in Michigan.
Toyoda said hinted that the automaker would at some point resurrect its plan to build the Prius in the United States when sales grow.
Toyota unveiled its new Entune multimedia system today at the Consumer Electronics Show (CES) in Las Vegas. Toyota's Entune launch is one of several major automotive tech premiers expected at CES this year; Chrysler and Hyundai also plan to announce new entertainment platforms.
Entune will leverage an owner's mobile phone and data plan to bring a host of entertainment, navigation and information services to Toyota vehicles. The new platform is expected on select Toyota vehicles in late 2011, before moving through the lineup in 2012. Most attractive is the lack of monthly fees, as the Entune service will be provided for three years with each new Toyota.
No specifics were given about Lexus or Scion versions, but a Toyota spokesperson coyly noted: "stay tuned." .
Seven insurance companies have sued Toyota Motor Corp. in an attempt to recover money paid to cover crashes they blame on sudden acceleration, the Associated Pressreported in picking up a story from the Los Angeles Times this morning.
The insurers cite data that blames 725 crashes on the problem. The fault, they claim is Toyota's for failing to equip its cars with a brake override system. The insurance companies seek damages in excess of $230,000 for 14 crashes.
Toyota responded that the latest lawsuits were without merit.
Toyota executives told auto analysts today that they expect the U.S. industry to sell 12.5 million cars and trucks in 2011, about a million more than than in 2010, and that Toyota will do even better than the industry in general because of the many new models it will introduce.
"The first half of 2011 will look like the second half of 2011. We'll see good signs and some growth but other indicators that will cause us to wonder," said Bob Daly, senior vice pesident, Toyota Planning & Development. He noted Toyota's industry forecast is more conservative than others largely because stubbornly high unemployment an d a floundering housing market will hinder further growth. Edmunds.com is forecasts a somewhat higher 12.9 million cars and trucks sold in 2011.
Automakers report December and 2010 year-end sales on Tuesday. Daly predicts Lexus, which had strong end of month sales, will retain its No. 1 spot in luxury sales for the 11th consecutive year when the totals are tallied.
As the most tumultuous year in its history of selling vehicles in the United States comes to a close, Toyota Motor Corp. has agreed to pay a record $32.4 million in fines -- the maximum that can be levied -- to settle two government investigations into its delay of recalling more than 6 million vehicles for potential problems.
The settlements with the U.S. National Highway Traffic Safety Administration (NHTSA), announced by Toyota and NHTSA late Monday night, involve Toyota's delay in issuing recalls dating back to 2005 to address possible problems with steering relay rods and from 2007 to early 2010 over potential for entrapment of the accelerator pedal by floor mats.
That brings the grand total of fines paid by Toyota so far this year to nearly $49 million this year, the most ever paid by an automaker in the United States.
The recalls and negative publicity have deeply damaged Toyota's once sterling reputation for bullet-proof quality, triggering a drop in Toyota's U.S. market share.
Toyota Motor Corp. said Monday it is launching a repair campaign on about 650,000 Prius hybrid cars globally - more than half of those in the U.S. - to repair a water pump that can cause the cars to overheat and lose power.
In the U.S., the campaign covers 378,000 Prius hybrids from model year 2004 through 2007. The remainder was sold in Japan, Europe and Australia.
Toyota Motor's Gateway assembly plant in Thailand began delivering 2011 Prius models to Thai dealers Monday, marking the first time the popular gas-electric hybrid has been built outside of Japan.
The plant, which also builds Toyota Camry, Camry Hybrid and Corolla models, is expected to turn out 12,000 Priuses a year for sale within the country.
Toyota executives said last month that Priuses built at the Gateway plant would not be exported.
It's steady as she goes for auto-industry sales in November, which on many fronts may be seen as a "no news is good news" revelation considering ongoing instability in the economy, the stock market and now, geopolitics in Korea.
Analysts at Edmunds.com, parent of AutoObserver, project November new-vehicle sales will result in a Seasonally Adjusted Annual Rate (SAAR) of 12.2 million, effectively the same rate as in October.
In raw numbers, November's projected new-car sales - including fleet sales - of 865,000 units is a welcome 17-percent hike compared with last November, but an 8.1-percent drop from last month. November, however, traditionally is one of the year's weakest months for new-vehicle sales.
Less than a week after General Motors Co.'s initial public offering last Thursday, the price of GM stock has retreated into a narrow channel with little movement after an initial flurry raised the stock to a high of $35.60 from its offering price of $33.
At mid-afternoon today and with the broad market down considerably over geopolitical concerns, at $33.60 GM stock was trading at just 2 percent over its offering price. The lowest GM has closed since returning to public ownership was $33.41 last Friday, the day after an IPO. Judging from the reported exuberance to buy GM stock prior to the offering and some analysts' quiet contention the stock price could rocket, the stock's price performance so far has not been extraordinary and reinforces the notion the initial offering price was accurately formulated.
The National Highway Traffic Safety Administration yesterday said it will consider a request for the agency to investigate complaints about braking for 2005-model Honda Accord Hybrid and Civic Hybrid models, while NHTSA data analyzed by Edmunds.com indicates that since 2005, Honda has trailed only Toyota Motor Corp. in the number of braking-related complaints to NHTSA.
The incidence of braking-related complaints to NHTSA appears to be outsized for Honda, because while the company is second only to Toyota in the number of braking-related complaints per 100,000 vehicles, since 2005 Honda has the lowest number of overall complaints per 100,000 vehicles among seven largest-selling automakers.
Maybe not all the press at the Los Angeles auto show today picked up on it, but some must have gotten the vibe of the potential dawn of a new business-relationship model when Toyota Motor Sales USA Inc. president Jim Lentz unveiled the prototype battery-electric RAV4 EV by saying, "Ladies and gentlemen, it is my pleasure to introduce the second-generation Toyota RAV4 EV - powered by Tesla."
Toyota and Silicon Valley automotive-startup darling Tesla Motors appear to be forming a fast friendship - one that has numerous intriguing possibilities to help begin transforming the century-old automotive manufacturing business model. Toyota has invested $50 million in Tesla and sold the now-famous maker of the Tesla Roadster its Fremont, California manufacturing plant (long the site of joint-venture auto assembly with the former General Motors Corp.).
The Fremont plant has vastly more acreage and latent capacity than low-volume Tesla needs - now, or long into its foreseeable future - leaving open any number of options for either company to produce advanced-technology vehicles and components there. Jointly or separately. Or, as some have speculated, perhaps in cooperation with yet other automakers or suppliers.
There is much hopeful and upbeat as the Los Angeles auto show opens to the media today.
Automakers are making an increasingly credible collective effort to open a new era of advanced, more-efficient and more environmentally friendly personal mobility. There's a growing sense such a transformation might even evolve into profitable business. And, of course, there's the rebound - so far a stunted, jerky one, but 2010 will be kinder to the auto industry than was 2009.
Many automakers, however, still are licking wounds from the protracted recession, the battle for market share is more cutthroat than ever and although General Motors Co. is set to return to public ownership tomorrow and many other makers are unexpectedly healthy, too, the stock market continues its nervous ways, nobody's certain consumers will return to showrooms with gusto next year - nd nobody's certain that when customers do buy, they'll be ready to embrace more-expensive, less-big vehicles when gasoline prices remain as depressed as the economy.
Toyota Motor Corp. today announced financial results for the first half of the company's fiscal year that ended in September, saying it logged a net income of nearly $3.6 billion in a first half that saw the company's image of peerless quality drubbed by an unprecedented string of worldwide recalls and a scare about unintended acceleration in the U.S. and abroad.
Perhaps forebodingly, however, Toyota's operating income from financing new vehicles - as well as gains the financing unit made via loan spreads and used-vehicle residual values - was nearly double the profit it made from actually selling new vehicles.
The company also increased global sales in the first half by 585,000 vehicles compared with like-2009, when the global auto industry sales were experiencing depths not seen for decades.
Toyota's global vehicle production fell in September, its first year-to-year decline in 12 months.
Toyota said Monday it built 672,604 vehicles in the world, a 1.3 percent drop. The company blamed the drop on weak demand in North America, where it closed its California plant, and Europe.
A Toyota executive said the automaker's production would continue to be weak through year-end due to the end of Japan's subsidy program and a continued weak U.S. economy.
Honda and Nissan production rose on strong demand in China. Subaru and Mitsubishi production also increased.
A new Toyota Motor Corp. recall this week of 740,000 vehicles in the U.S. is for a brake-system problem quite similar to one addressed in a 2007 recall, according to an Edmunds.com analysis of National Highway Traffic Safety Administration data.
The latest recall - for 2005-06 Avalon, 2004-06 Highlander and 2006 Lexus RX 330, IS 250/350 and GS 300 - involves a seal on the brake master cylinder that can become too dry in the presence of brake fluid without the proper amount of lubricant, causing the seal to leak. In 2007, Toyota recalled 2006 Tundra pickups and 2005-07 Sequoia SUVs that may have had replacement master cylinders installed with seals that could fail and leak brake fluid.
It's "between-a-rock-and-a-hard-place" time for Toyota Motor Corp. as the company that struggled through a safety and recall media storm earlier this year once again is announcing an extensive recall of popular vehicles in the U.S, Japan and other regions.
Toyota's latest recall comes just as it seemed consumers might be getting over the unintended-acceleration furor that began in late 2009, led to a massive recall of millions of vehicles to replace floor mates and sticking accelerator pedals and culminated with Congressional hearings last spring calling the company - and the National Highway Traffic Safety Administration -on the carpet for a system that appeared to be ill-responsive to consumer reports of potential safety problems.
The company said today it is voluntarily recalling more than 1.5 million vehicles globally to correct a problem with the brake master cylinder that could cause fluid to leak around its seal and onto the brake booster. Toyota said in a press release the situation could cause brake feel to become spongy and "braking performance may gradually decline."
U.S. auto sales steadied last month, rising slightly from the seasonal pace of August and reassuring carmakers that they'll still finish the year ahead about 10 percent in sales volume compared with a dismal 2009.
Industry-wide sales were about 958,835 units in September, up a healthy 30.8 percent from year-earlier sales of 733,069 units. The percentage increase this year was discounted because it was such an easy comparison with September, 2009, when sales dropped off atypically after the federal government's "cash for clunkers" program touched off a buying frenzy in August.
But the seasonally adjusted annual sales rate for the just-concluded month and for the third quarter rose to 11.7 million units, including both light vehicles and medium-duty trucks. That number is right in the wheelhouse of the 11.5-million-plus units that still represents the industry's consensus forecast for all of 2010.
Perhaps more important at the moment, the pace of transactions represented another step up in the industry's momentum after some insiders had questioned the direction of sales during the last couple of months.
As tightening inventories becomes a new business practice for automakers and many dealer lots have noticeably more elbow room, spending on incentives also is contracting: data from Edmunds.com indicates the overall average industry Total Cost of Incentives (TCI) for September was $2,576 per vehicle, down 6.2 percent from the same period last year.
September incentive spending also was down by 4.6 percent - about $125 - from August, when the industry average TCI per vehicle was $2,701.
Moreover, September incentives for 2010 models decreased from August, bucking the industry's history to typically increase incentives in September as automakers attempt to sell off current model-year vehicles. This almost certainly indicates, said Edmunds.com industry analyst Ivan Drury, that remaining inventory for current model-year vehicles is far less than in years past.
Toyota hopes to breathe new life into its youth-oriented Scion brand by more than doubling sales of its volume-leading tC, which is redesigned as a 2011 model and goes on sale Oct. 1.
At a test drive event in the Detroit area Wednesday, Scion chief Jack Hollis said the goal is to sell 35,000 to 45,000 units of the revised sporty tC coupe in its first full year of sales. Scion sold only 18,000 tCs in 2009, one of the worst years in recent memory for industrywide auto sales.
In a signal not only that jobs in the current economy are precious but that auto manufacturing jobs apparently still carry weight, in the first week after announcing it was accepting applications for hourly workers at its restarted assembly plant in Blue Springs, Toyota Motor Manufacturing Mississippi Inc. has been inundated with about 9,500 applications for the approximately 1,350 hourly jobs at the site.
Construction of the Blue Springs plant, started in 2007 but suspended in 2008 when the economy soured, recently was restarted in order to build the Corolla compact car starting next year.
The plant originally was earmarked to be the first-ever U.S. source for Toyota's Prius hybrid-electric vehicle, but after shaky Prius sales during the recession and Toyota's decision to shutter the plant in Fremont, CA, that recently built the Corolla and Matrix, the company announced in June a plan to finish the TMMM plant and build the Corolla there.
The Jackson Clarion-Ledger reports starting pay will be in the $15- to $20-per-hour range, with applications in the first week coming from 33 states, including Michigan and California. About 8,000 of the total applications came from Mississippi and there will be about 150 salaried jobs at the Blue Springs plant.
he future for the species known as the midsize pickup is getting darker with the news this week that the Volkswagen Group isn't interesting in entering the market and Ford Motor Co. seemingly is unmoved by recent overtures asking the company to reconsider the scheduled closure of its Ranger assembly plant in Minnesota.
Edmunds.com's Inside Line reported yesterday that VW officials closed the door on longstanding speculation the company was eying the U.S. market for introduction of the Amorak, a midsize pickup that essentially could be seen as VW's interpretation of the Ford Explorer Sport Trac. In Brazil, one of the prime markets for the Amorak, media relations manager Gilberto dos Santos told Inside Line, "Volkswagen is not planning currently to market the Amarok in the U.S.
"It is destined for South America, Europe, Russia, Australia, South Africa and New Zealand," The VW public-relations official continued. "Capacity of the General Pacheco manufacturing plant in Argentina is 100,000 units yearly, and the planned demand will be fully met. Other markets such as the U.S. and Asia are not in the company's plans."
Auto-industry executives keep talking about how they've trimmed down in order to bulk up profits, but that's only partially true. Many indeed are profitable at today's sharply reduced global sales rates - but they've still got some work to do in cutting the fat from their manufacturing empires.
The latest data from Oliver Wyman's prestigious Harbour Report that tracks the auto industry's manufacturing trends shows that there remains an enormous amount of excess assembly-plant capacity in the U.S. and Europe, despite the fact major automakers such as General Motors Co. Ford Motor Co. and Chrysler Group LLC have shuttered more than two dozen plants in North America alone since 2000.
Regardless of that seemingly major downsizing, the report indicates that in the northern U.S. and Canada, automakers still are tied to the capacity to manufacture more than 3.5 million more vehicles than they currently need - or another 14 more assembly plants of unnecessary capacity.
Proving true to its word of being more responsive to consumer concerns while at the same time likely still smarting from the biggest recall-related fine ever paid by an automaker, Toyota Motor Corp. today announced it will recall more than 1 million Corolla and Matrix models to replace a potentially faulty electronic circuit board.
Toyota's move comes after the National Highway Traffic Safety Administration said it was broadening its own scrutiny of consumer complaints about the cars' proclivity to stall or run rough and fail to start. In all, about 1.13 million Corolla and Matrix vehicles from the 2005 to 2008 model years will be recalled to replace engine control modules that might develop cracks at solder points or varistor, which protects against voltage surges.
The recall also encompasses about 161,000 Pontiac Vibes, which use the same engine and other mechanicals. The Pontiac brand was discontinued by General Motors Co. last year.
August new-vehicle sales will remain steady at a Seasonally Adjusted Annual Rate (SAAR) of 11.8 million, according to data from Edmunds.com, but when totals are finalized next week, the month certainly won't be able to compare to last August's Cash For Clunkers-fueled SAAR of 14.1 million.
August new-vehicle sales (including fleet transactions) are expected to be 1,028,200 units, a 17.7-percent decrease from August 2009, when Cash For Clunkers pushed the industry to 1,261,799 sales. Total August sales will represent a 1.4 percent decrease from July 2010, according to Edmunds.com data., while August's projected 11.8-million SAAR compares with 11.5 million in July.
"Comparing to last August is a waste of time since Cash for Clunkers distorted the market so badly last year," said Jessica Caldwell, director of industry analysis for Edmunds.com "It is likely that the current slow sales pace can be partly attributed to the thousands of 'pull-ahead' sales that last year's CARS program stole from subsequent months."
Toyota Motor Corp. is looking to boost 2015 global fleetwide fuel efficiency by 25 percent from 2005 levels by broadening sales of hybrid-electric vehicles and introducing battery-electric vehicle (BEV) and plug-in hybrid-electric vehicles (PHEV), as the world's largest automaker outlined its fifth so-called "Environmental Action Plan" earlier today.
Toyota will debut its first PHEV by 2012, with a first-year sales goal of more than 10,000 units, while introducing a BEV specifically for city use that same year, the company said. Toyota, whose Prius is the world's best-selling HEV, looks to boost annual hybrid sales to 1 million units while reaching cumulative sales of 5 million units sometime in the early part of this decade.
The automaker outlined this and more as part of its Environmental Action Plan for the five years starting in 2011. Toyota said earlier this month that it's cumulatively sold more than 1 million hybrid vehicles in Japan and about 2.7 million globally. Toyota sold 80,141 Priuses in the U.S. during the first seven months of the year, up 7 percent from the same period in 2009.
Bending under the sustained pressure of a years-long deflationary economic environment, the current situation in Japan may be a cautionary one for those not convinced the potential onset of deflation should be a concern for the United States.
The New York Times reports today that anxiety is mounting in Japan for action after recent economic measures showed the nation's economy, long the world's second-largest, has been surpassed by China. Meanwhile, for this export-dependent nation, the burgeoning value of the yen (now at around 85 to the dollar) has combined with a new dip in the Nikkei stock index - to its lowest this year - to hike concern that Japan's economy can't break free of its deflationary downspin.
Economists and policy experts in the U.S. aren't in a panic about deflation, but some now are wondering if Japan's near decade of deflation-fighting doesn't now warrant closer examination for lessons American policy-makers might take to heart.
"Japan's experience shows that deflation can creep up on an economy -- and can be extremely difficult to shake," the NYT article said.
When refuting recent claims of drivers citing unintended acceleration in its vehicles, Toyota Motor Corp. often has pointed to evidence gathered by onboard event data recorders, the so-called "black boxes" that became one point of discussion in the Congressional unintended-acceleration investigation earlier this year.
After the Congressional inquiry, Toyota pointed to data recovered from black boxes to repudiate unintended acceleration claims in at least two well-publicized accidents and the company said it was moving to equip more of its vehicles with the devices that typically record a number of vehicle operating parameters for several seconds prior to an accident.
But the Washington Post reports today that in the past, Toyota has itself questioned the validity of information provided by its EDRs.
In another development that partially exonerates Toyota Motor Corp. in reported incidents of unintended acceleration, the results of an early study of data from onboard data recorders shows that in the majority of cases, the driver was not applying the brakes while the vehicle purportedly was accelerating of its own accord.
The findings, reached in the initial phase of a study conducted by the National Highway Traffic Safety Administration, showed that in 58 accidents attributed to unintended acceleration, in more than half, 35, the brakes were not applied.
The finding lends more credence to the widely believed explanation that many drivers were mistakenly pressing the accelerator pedal when they were convinced their vehicle was accelerating of its own accord.
The safety agency researchers said in reporting the findings that they had discovered no evidence of electrical malfunctions, including in the electronically controlled throttle, that could be possible causes for unintended acceleration.
At the peak of the recent furor surrounding Toyota and a rash of complaints regarding unintended acceleration, a Toyota recall of millions of accelerator-pedal assemblies that had the potential for the pedal to stick in a full-open or partially-open position led some to believe the pedal and/or electronic throttle system could be causing the problem.
National Public Radio's On Point program used the occasion of President Obama's visit to a Ford assembly plant in Chicago to look under the hood of the U.S. auto industry. Only a year ago, Ford was struggling financially, while General Motors and Chrysler had just emerged from Chapter 11 bankruptcy.
Last week, the President was in Detroit visiting GM and Chrysler plants, hailing the governments $60 billion bailout of GM and Chrysler as a victory. A guest to the On Point program today, Ron Bloom,chief advisor to the U.S. Treasury Department on the auto industry -- the " Car Czar" -- was more cautious in declaring mission accomplished. Michelle Krebs, senior analyst and editor at large for Edmunds.com, was a guest on the program. So too was Edmunds AutoObserver.com contributor and Pulitzer-Prize winning writer Paul Ingrassia as well as Kentucky dealer Jack Kain, of Jack Kain Ford.
There are 40 million Toyota-made vehicles on the road using electronically controlled throttles and despite the efforts of a horde of independent testers and a virtual army of the company's own engineers, nobody's been able to find anything wrong with the technology typically pointed to as the "likely" cause for unintended acceleration, said Steve St. Angelo, the American executive leading Toyota's new North American Quality Task Force.
Speaking at the Center for Automotive Research's Management Briefing Seminars today in Traverse City, MI, St. Angelo, vice president of Toyota Engineering and Manufacturing North America Inc. and chief quality officer for the Quality Task Force, said everyone from a newly constituted Quality Advisory Panel seeded by high-profile names to individual assembly-line workers is engaged in the company's effort to assure a higher level of quality - and reassure Toyota's customers, who after Toyota's highly publicized quality and safety-related recalls apparently have been availing themselves of other options.
Toyota sold more Corollas than Honda did its Civics. In fact, Toyota sold more Corollas this July than last, whereas Honda sold less this year than last. The Hyundai Elantra, due for replacement in the coming months, came on strong in July. The current Ford Focus is winding down to pave the way for the new one. Similarly, the Chevrolet Cobalt is making way for the all-important Chevrolet Cruze. The Nissan Sentra helped the division achieve across-the-board increases this July.
A reversal of fortunes in the recently closed quarter has given Toyota enough confidence to boost its outlook for its current fiscal year that runs through March 2011.
Despite lingering recall woes in the United States, Toyota Motor Corp. turned a profit of $2.2 billion in the quarter ended June 30. Toyota credited a recovering U.S. car market, Japanese government incentives, brisk sales in Asia and cost cutting with its return to profitability.
At an auto-industry conference Tuesday, Toyota's engineer in charge of the company's plug-in hybrid program said plug-in versions of the Prius hybrid-electric vehicle should deliver significant fuel economy gains - even for those who travel further every day than the 13 miles of all-electric driving available from the car's lithium-ion batteries.
At the Center for Automotive Research Management Briefing Seminars in Michigan, Justin Ward, Toyota Motor Engineering and Manufacturing North America Inc.'s advanced powertrain program manager said Toyota's first plug-in hybrid - just now starting with a 150-vehicle test fleet in the U.S. - will deliver significant fuel economy gains over the 51 miles per gallon rating of today's non-plug-in Prius.
Ward said that official U.S. fuel-economy figures haven't been finalized, but testing in Europe has proven the plug-in car to be about 42 percent better than the Prius.
Pickup-truck sales have strengthened a bit so far this year, and there's a nascent confidence in Detroit - which makes nearly all of the pickups sold in North America - that the segment's recovery from a deep trough will acquire still more steam through the end of 2010.
General Motors, for instance, is calling for trucks to grab 0.3 percent more of the overall U.S. market by the end of the year than in the first half.
"Our dealers still remain very optimistic, particularly on pickups, for the next six months of the year; they're a big part of our media spend and our promotional focus," said Brian Sweeney, general manager of GM's GMC truck brand. "In some of our big pickup markets, the economy is bouncing back, so we're very positive about the next six months with Sierra sales."
George Rogers, head of Ford's Team Detroit advertising agency, believes that "there is still a tremendous amount of pent-up demand in the [pickup] market that isn't reflected in current figures."
Toyota is expected to report a group operating profit of about 100 billion yen ($1.1 billion) for the three-month period ended June 30 thanks to strong sales and despite recall woes, Japanese business daily Nikkei reported Sunday.
Last year at this time, Toyota reported a 195 billion yen loss.
Toyota, including its Hino and Daihatsu affiliates, sold nearly 1.9 million vehicles, a 30 percent hike from a year ago, the newspaper reported.
Newly-minted president Bob King is trying to revive an ailing United Auto Workers union by vowing anew to organize Toyota's U.S. factories, a campaign that has as much chance of success as King being invited to perform card tricks at Toyota's next board of directors meeting.
King, one of the best thinkers to lead the UAW, surely realizes that Toyota's U.S. workers, having watched the bankruptcies of General Motors and Chrysler on top of wage concessions at UAW plants, have scant reason to welcome the union. The UAW since the 1980s has failed to elicit the interest of Toyota workers, who now have benefitted because their employer avoided layoffs as the U.S. automotive downturn slowed and idled plants.
Jim Press, former Toyota and Chrysler executive, is now working for Renault-Nissan, the automaker confirmed.
A company spokesman confirmed Press, who once was Toyota's top American executive and subsequently Chrysler vice chairman, has been working as a consultant to the automaker's global sales and marketing group for four months. He has been visiting dealers in the United States, Europe and Japan, the automaker said.
Automakers and their dealers have dodged a couple of potentially troublesome regulatory bullets as politicians have backed off from what were expected to be heavy-handed new regulations.
First, the wide-ranging financial-reform bill emerges this week from months of highly-charged political wrangling in a form that is expected to be passed without any provisions for regulation of auto-dealer sales by a newly formed consumer-protection authority.
And what looked like it was shaping up to be one of history's most potentially powerful acts of legislation dealing with automotive safety has been significantly toned down, according to reports from Washington this week.
Despite expected weak sales in June and signs of a slowing economic recovery, automakers are remaining vigilant in keeping inventories low so they don't require expensive incentives to move the metal.
Edmunds.com data shows another dip in incentive spending in June. The average incentive was $2,661 per vehicle sold in June 2010, Edmunds.com estimates. That's down $36, or 1.3 percent, from May and down $196, or 6.9 percent, from June 2009.
Automakers report sales Wednesday, which are expected to by up from the dismal levels of last June but down from weak May of this year. A year ago, incentives were high because inventories were high and sales were particularly depressed as consumers awaited details of the governments Cash for Clunkers program.
In its first report Wednesday to the National Highway Traffic Safety Administration and the public, members of a panel mandated by Congress to try to find answers to explain the surge of incidents involving reported unintended acceleration admitted those answers probably won't come easy.
One of the seemingly certain early answers: human error.
One of the few definitive results of the unintended acceleration crisis earlier this year that had Toyota Motor Corp.'s top executives testifying in the nation's capital was a mandate from Congress for the National Highway Traffic Safety Administration to form an independent scientific panel to study the unintended acceleration phenomenon.
In Washington Wednesday, that panel - the National Academy of Sciences' Committee on Electronic Vehicle Controls and Unintended Acceleration - is having its first meeting to tell the public how that's going.
Privately held companies' initial public offerings, or IPOs, were the Valhalla of the investment and "dot-com" sectors a decade ago. And despite the comparative financial bust the dot-com frenzy turned out to be, IPOs haven't totally lost the glamor they gained during that time.
Now it's the auto-sector's turn, with the heavily-hyped IPO of California's darling electric-vehicle company, Tesla Motors, ready to go IPO tomorrow. With IPO activity - and success - dropping precipitously during the recession, the Tesla offering will prove an interesting barometer of the appetite for IPOs in general and in particular how the merging of the auto, financial and "green" sectors affects the equation.
The reception for the Tesla IPO also may be an indicator for how well the hunkered-down investment community views this year's really big nut on the IPO tree: General Motors Co.'s return to the publicly-held domain, coming perhaps sometime before the end of this year.
On Thursday, automakers will report how many vehicles they sold in June and how many they sold in the first half of 2010. Edmunds.com's senior analysts Karl Brauer, Jessica Caldwell and Michelle Krebs share their thoughts - and concerns - about the year so far.
Toyota's highly publicized safety recall of 2.2 million cars in February seemed to precipitate a run of recent safety recalls by other automakers including General Motors, Chrysler, Honda and Hyundai. And 2010 overall is on pace for what could be the highest number of total recalled vehicles in this country since 2005.
But new analysis by Edmunds.com also demonstrates that the number of vehicles affected by industry safety recalls these days has declined dramatically compared with the record levels of a decade ago.
In a telling reversal of longstanding trends and perceptions, domestic automakers' brands, as a whole, have pulled ahead in overall quality as measured by J.D. Power and Associates' benchmark Initial Quality Study, now in its 24th year. It's the first time domestic brands have, in the aggregate, surpassed imports in initial quality, Power said today. The domestics brands' watershed performance in the 2010 U.S. Initial Quality Study was driven by quality improvements by new models from the surging Ford Motor Co. and the industry's trend in improving the general quality of newly launched vehicles.
True, the domestic triumph was not overwhelming: domestic brands experienced 108 problems per 100 vehicles compared with the 109 problems per 100 vehicles for imports. But the symbolic impact remains - domestics, overall, have better quality than imports.
"Domestic automakers have made impressive strides in steadily improving vehicle quality, particularly since 2007," said David Sargent, vice president of global vehicle research, in a release. "This year may mark a key turning point for U.S. brands as they continue to fight the battle against lingering negative perceptions of their quality."
Edmunds.com, parent of AutoObserver, today named vehicles in 21 distinct segments the leaders in its proprietary True Cost to Own (TCO) metric that establishes total vehicle ownership costs.
Vehicles by Japanese automakers dominate the 2010 TCO list, placing 14 of the 21 winners. Domestic automakers placed four models and European makers had three winners.
Six of the winners are made by Honda Motor Co. Ltd., the most by any manufacturer.
Edmunds.com's TCO pricing system estimates total vehicle ownership costs over a five-year period. The calculation incorporates projected average depreciation, financing, taxes, fees, insurance premiums, fuel costs, regional variances, maintenance and repairs for each model.
May sales reports from automakers came in stronger Wednesday than even Edmunds.com forecasted, suggesting a modest recovery is, indeed, under way. Edmunds.com CEO Jeremy Anwyl and analysts Karl Brauer and Jessica Caldwell discuss the 19-percent year-over-year sales rise in May, a month that came in at a 11.6 million Seasonally Adjusted Annual Rate of sales.
It's about time that the U.S. auto market followed script for a change, and May was that month: There was a modest increase in sales compared with last May, befitting the annual gain of 10 percent or more that the industry has forecast for the year as a whole. Steady as it goes was the byword.
For the month, automakers sold 1,099,000 vehicles in the U.S., 19 percent higher than the nadir of May, 2009, and an improvement from about 982,000 this April. More important, the pace of sales in May was about 11.6 million units on a seasonally adjusted annualized rate (SAAR) basis, a significant uptick from the 11.2-million rate posted in the previous month and right in line with the industry consensus that full-year sales will end up between 11.5 million and 12 million units compared with 10.4 million for 2009.
"This supports the thesis for the moderate recovery we've been forecasting," said George Pipas, head of U.S. industry analysis for Ford.
Edmunds.com analysts chimed in recently on the possible demise of Mercury; prospects of the Toyota-Tesla partnership; the return of super-luxury vehicle sales; and consumers responding to zero percent financing.
After a report from Japanese publication Best Car said Toyota Motor Corp. is delaying the launch of its FT-86 sport coupe by two years, to 2013, the internet was alive with speculation about Toyota's ultimate dedication to the coupe jointly developed with Fuji Heavy Industries Ltd.'s Subaru.
First reports of the project emerged in 2008 and at last October's Tokyo motor show, Toyota let loose with a concept car to confirm the program indeed was underway.
But all along the way, there have been reports of various delays, conflicting development goals and other hiccups, including speculation about Toyota's acceptance of the Subaru-derived drivetrain - and even whether the car would be rear-wheel drive, one of the most attractive promised attributes.
Edmund.com analysts talked with the media in recent weeks about the Toyota-Tesla link, a drop in Toyota's sales, a rise in Ford sales, conventional versus electric cars, the best family cars, leasing and General Motors marketing and rising profitability.
Forget unintended acceleration. Toyota Motor Corp. is at the epicenter of another auto- industry story of the year: teaming with radical electric-vehicle upstart Tesla Motors to jointly develop a new electric vehicle while also brokering Tesla's purchase of Toyota's recently shuttered New United Motor Manufacturing Inc. assembly plant in Fremont, Calif.
The deal means the NUMMI plant is where Tesla will build the heralded Tesla S battery-powered sedan - and both companies will develop and produce other EVs there.
Toyota also will buy $50 million worth of Tesla stock when the company initiates its planned public offering. But the teaming of the two companies from widely divergent places on the corporate spectrum will have enormous repercussions throughout the industry.
Early May car sales indicate sales for Toyota Motor are down 15 percent for the same period last month despite aggressive incentives, according to an analysis by Edmunds.com, which also noted General Motors and Nissan sales up from a month earlier.
"Toyota's incentive program is falling on deaf ears. Most people who were open to getting deals from Toyota already made their purchases," said Edmunds.com Senior Analyst Jessica Caldwell. "Toyota has not yet recovered from recent image problems."
After a year-long run that saw auto-industry stock prices balloon from historic lows, the market retreat of the past several weeks has caused some give-backs on those exponential gains.
Ford Motor Co. stock had been in a dead sprint over the past year and in mid-March was trading at $13.40 per share - a price Ford shareholders hadn't enjoyed since 2004. But the price has retreated twice this month by nearly 20 percent, leaving some market watchers to wonder Ford is being dragged down in general or whether its stock price had become too overheated, particularly when considering the company's still-considerable debt load.
Over the decades OEMs have gone their separate ways on a number of big strategic matters that ended up becoming major determinants of the industry's winners and losers. Front-wheel drive or rear-wheel drive? Unionized or non-union factories? Global mega-merger or not?
Automakers likewise are diverging around the question of how to approach the onboard "infotainment" revolution. Platforms including General Motors' OnStar, Ford's Sync and Mercedes-Benz's mbrace represent early commitments to widely varying answers.
And Hyundai's recent announcement of tie-ins between iPad and the company's upcoming 2011 Equus luxury sedan is further indication that every OEM believes the procurement, packaging and presentation of wireless content and connections going into, coming out of and bouncing around within vehicles can make a huge difference.
"It's the next big battleground in the industry," said John Wolkonowicz, senior auto analyst for IHS Global Insight, a market-research firm in Lexington, Mass. "It is addressing what people under 50 years old today find absolutely mandatory in their vehicles."
Toyota intends to ease off the gas on incentives by fall or at least by the end of the year, a top company executive said Tuesday.
Takahiko Ijichi, Toyota Motor Corp. senior managing director, acknowledged Toyota's unprecedented incentives were instituted in the automaker's effort to boost sales in the U.S., where sales had been hurt by recalls, stop-sales orders on popular models and ensuing negative publicity.
"We so not expect to continue this level of incentives," he told analysts and media during a conference call on Toyota earnings Monday. "By fall or the end of this year, we're planning to get incentive levels to historical levels."
Despite global recalls, Toyota Motor Corp. reversed direction and made money in its recently closed fiscal year. The automaker predicted even heftier profits for the new year, indicating the recalls are little more than a hiccup as far as Toyota's financial performance is concerned.
Toyota President Akio Toyoda warned in a statement that the automaker remains in "stormy waters," but he said was "sincerely grateful" to the company's constituencies for their efforts in helping Toyota "return to its normal state as soon as possible.
Toyota's earnings announcement comes a day after U.S. Transportation Secretary Ray LaHood announced in Japan that more fines could be levied against the automaker for foot-dragging on quality problems, and his department opened yet-another investigation into product safety, this time regarding Toyota trucks.
U.S. Transportation Secretary Ray LaHood said Monday that Toyota could face more fines in the States over its handling of vehicle recalls for potential sudden acceleration.
LaHood briefed reporters in Japan Monday after spending several hours with Toyota President Akio Toyoda at the company headquarters and touring its facilities. He said the U.S. government has several pending investigation into Toyota recalls and is reviewing 500,000 pages of documents. The investigations could result in more fines in the coming months. Toyota also faces hundreds of lawsuits.
Toyoda told reports that the automaker is cooperating fully with NHTSA "in working toward a common goal of creating a safe automobile society."
For the first time in the history of the 10-year-old study that looks at the relationship between automakers and their suppliers, a U.S. automaker -- Ford -- ranked in the top three. It was third, with Honda and Toyota in 1st and 2nd place, respectively.
The annual North American OEM-Supplier Working Relations study, done by Birmingham, Mich.-based Planning Perspectives, closely follows supplier perceptions of their working relations with the top three U.S. and top three Japanese automakers across 14 commodity purchasing areas. About 45 percent of automotive suppliers in Planning Perspectives' database participated in the study.
"When the U.S. automakers were in bankruptcy, or in Ford's case near bankruptcy, they knew they could not come back alone," John W. Henke Jr., president of the management consulting firm, told AutoObserver in an interview. "Alan Mulally (Ford president and CEO), a big proponent of good supplier relations since his days at Boeing, has been taking a more active role in getting top management to strive for strong supplier relations."
It's not the sexiest segment around, and speculation has long held that various new vehicle configurations, namely crossovers, would cause serious erosion of the midsize sedan market. But as the broad economic and auto-industry recoveries proceed almost in lockstep, it looks as if cautious buyers re-entering the market are gravitating to the safe play: sales of midsize sedans are more than a little robust.
Although most companies had trouble logging April sales that surpassed those of the incentive-fueled March, midsize sedans certainly weren't the problem. April and year-to-date sales show the segment on its way to perhaps some of its best results in a long while.
The segment's growth isn't coming from only the usual suspects, either: There's a hot new player stoking fresh interest in the four-door family car. And higher incentives, two words the industry is reluctantly latching onto as its recovery comes with one step forward and two steps back, also a playing a role in the midsize-sedan renaissance.
In a sign of modest progress for the American car market, sales in April were up 20 percent from a year ago, though they declined by 8 percent from March. Still, auto company executives and outside analysts pronounced the industry's modest recovery remains on track - and, in fact, is expected to strengthen - as the year goes on.
Industrywide sales of 981,659 vehicles compared with 817,096 sold last April. But last spring marked the depths of the Great Recession, and so a better comparison for the current market actually was March 2010. Sales in April eased to a Seasonally Adjusted Annual Rate of about 11.2 million from 11.8 million in March, but higher than last April's 9.2 million.
While some automakers carried over their rather hefty incentive programs from March into April, including popular zero-percent financing and discounted leases, their effectiveness appears to be waning, according to estimates by Edmunds.com.
"The automakers that need extra marketing support will have to pull out a new trick for May," said Jessica Caldwell, Edmunds.com's director of Industry Analysis.
Industrywide, manufacturer incentives dropped in April from last April and March. Sales, being reported by automakers Monday, are forecasted to be well ahead of last April but slightly down from March.
Honda may prove the exception. Its incentives hit a record high in April and its sales may be up.
The well-watched unfolding of Lexus' safety recall of the 2010 GX 460 SUV comes to something of a close with parent Toyota Motor Sales USA announcing Thursday dealers have in hand a software reprogramming package for the GX 460's stability control system.
Toyota also recalled about 50,000 2003-model Sequoia SUVs for a stability-control reprogramming because the system may cut in too early and unnecessarily curtail acceleration.
The issue of the 2010 GX 460's extreme-maneuver handling was called into question when Consumer's Union, parent of Consumer Reports, issued a derogatory "do not buy" recommendation after GX 460s it tested slewed sideways in an extreme-handling test, a situation that a properly functioning tability-control system should have mitigated.
Credit-rating service Moody's cut its grade on Toyota Motor Corp. based on its prediction that the Japanese automaker faces a long profitability slump coupled with potentially expensive lawsuit costs from its multiple vehicle recalls around the globe.
It marked Toyota's lowest credit rating ever, and it was yet-another piece of bad news in yet-another week of bad news for Toyota.
Toyota Motor Corp.'s reputation may have taken a whack in recent months, but those troubles apparently are nothing a good deal couldn't make buyers forget.
According to data released today by Edmunds.com, parent of AutoObserver, a remarkable 71 percent of all Toyotas sold last month were financed through a 0-percent loans. Battling the tide of negative publicity surrounding a string of recalls related to unintended acceleration, Toyota in March took the uncommon step of offering 0-percent loans for as much as 60 months on even its most popular models - including, at least in some markets, the Prius hybrid-electric vehicle.
As Toyota's unintended-acceleration controversy abated, the company ratcheted back on its heaviest incentives, but its March blow-out led the entire industry to its biggest 0-percent financing penetration rate since Edmunds.com began compiling the data six years ago.
Reports late Sunday from Washington, D.C. and written by the Los Angeles Times said Toyota Motor Corp. agreed to pay a record $16.4-million fine dealt the company by the National Highway Traffic Safety Administration for delaying a recall of potentially sticking throttle pedals in 2.3 million vehicles in the U.S.
It is the largest fine ever levied against an automaker for a recall-related matter and brings a certain closure - although probably far from a finish - to an uncharacteristically flawed chapter in Toyota's corporate history.
The staff at Edmunds is a diverse group with hundreds of different perspectives on the auto industry and the world at large.Here's a look at what we're reading and thinking about this week...
Chief Culture Officer: How to Create a Living, Breathing Corporation by Grant McCracken
"Levi Strauss, the jeans and apparel maker, misses hip-hop. The penalty: $1 billion. Quaker pays too much for Snapple. The penalty: $1.4 billion. Facebook claims 7 billion photos as its own. Embarrassment and recantation follow. These corporations, like most, were bad at reading culture, bad at staying in touch with culture, bad at working with culture. And it cost them dearly."
Edmunds staffer says: Chief Culture Officer, in the narrow sense, argues for a C-level executive that is completely immersed in, and in tune with, the ambient culture.The idea being that every aspect of a company - marketing, product, purpose - depend on a keen understanding of that culture.More broadly, the book calls for a revolution in the way companies approach their customers, specifically to invest, in very specific ways, to understand them and to learn to empathize with them and their challenges.The concrete examples provide for engaging reading and serve as a guide to adopting best practices in any organizational context. --Seth Berkowitz, Chief Operating Officer
When Toyota Motor Corp. heard of the "don't buy" label Consumer Reports hung on the Lexus GX 460 sport-utility vehicle sold by its upscale division, this time it wasted no time: The company halted sales of the SUV while it sorts out the problem.
But the problem isn't only with the GX 460's reported propensity to fishtail when cornering hard and the driver abruptly closes the throttle (a handling deficiency that Consumer Reports said came up in itsroutine testing). Toyota's real problem is it can't afford to give the impression one moment is being squandered in evaluating and acting on a safety-related complaint.
The average automobile finance rate dropped to 4.4 percent in March, its lowest since 2002 when Edmunds.com began to track finance records. The fall was due hefty incentives offered in March that included zero-percent financing and were led by Toyota.
By comparison, the average interest rate for the industry was 5.8 percent in March 2009.
Indeed, of all brands, Toyota had the lowest average finance rate at 1.9 percent in March. In an effort to regain lost sales from January and February and renew consumer confidence in its products, Toyota offered the biggest incentives in its history in the U.S., according to Edmunds.com's Total Cost of Incentives (TCI) analysis for March.
Edmunds.com analysts had their say with a number of media outlets on various topics including: GM's financial report; the Transportation Department's fine against Toyota and the release of Toyota internal documents; the pick-up in truck sales; and Washington's promotion of the benefits of last summer's Cash for Clunkers program.
Plenty of words written and opinions expressed about the luxury midsize hatchbacks recently launched by BMW AG (550i GT) and Honda Motor Co. Ltd.'s Acura unit (ZDX). Most of the talk hasn't been complimentary -- the new cars' polarizing styling seems to be mostly polarizing toward the negative.
American buyers famously don't favor hatchbacks, even in the lower market segments, so the introduction of the big-money 550i GT and the ZDX -- and to a lesser extent, Honda's new Accord Crosstour and Toyota Motor Corp.'s Venza -- has generated a lot of what-were-they-thinking criticism.
But if BMW and Acura are on the leading edge of a latent new consumer trend, some of their rivals don't think so. Like the critics, two Japanese competitors think luxury hatchbacks currently are a bridge too far.
In a conference call with analysts and reporters today, Toyota Motor Corp. President Akio Toyoda spoke of the company's new and ongoing initiatives to repair its battered image and improve vehicle quality, but did not speak of the $16.4-million fine the National Highway Traffic Safety Administration handed the company last week for being slow to report knowledge of sticky accelerator pedals in many Toyota vehicles.
The call was billed as one to deal largely with financial matters, but Toyota's boss and other executives also didn't mention a report from Japan on Tuesday saying the company plans to cut its dividend for the 2009 fiscal year that ended March 31. A later story said Toyota had not decided on the matter.
Fiscal year 2008 was the first time in company history the dividend was reduced, a humbling event for Toyota after losing nearly $5 billion.
Last week's New York auto show wrapped up for the media just as the industry's rough-and- tumble first quarter also came to a close. It was impossible not to connect the hardware on the New York show floor with the direction some of those vehicles' makers are headed as the industry writhes through what may or may not be labeled a recovery.
Judging from what's on display in New York, if there's a recovery underway, it's definitely going to treat some automakers better than others.
Using new products as the springboard, a scorecard of who's winning and losing so far this year:
American consumers returned to showrooms in force during March, driving overall sales to their best levels since last summer's peak around Cash for Clunkers. But there already were signals that the springtime spurt of sales momentum may not amount to much for the long term.
Automakers sold a total of 1,065,555 vehicles in the United States last month, the highest absolute number of sales since the federal government's massive buyback of late-model used cars sent sales skyrocketing last August. Last month's number also was 25 percent ahead of March, 2009.
Toyota, seeking to come back from recalls, quality issues and negitave publicity, set new heights for its incentives as it offered zero-percent financing and discounted leases throughout March, accourding to Edmunds.com's estimates.
The average automaker incentive in March was $2,742 per vehicle, up $100, or 3.8 percent, from February 2010, but down $423, or 13.4 percent, from March 2009.
Those hefty incentives offered by Toyota and other automakers who followed suit are expected to lift March car sales to their highest levels since last summer's Cash for Clunkers program, Edmunds.com Senior Analyst Jessica Caldwell predicted.
As automakers put the finishing touches on their March car sales numbers that will be announced on Thursday, it appears that the month came in like a lion but went out like a lamb, according to Edmunds.com's ongoing tracking of actual sales transaction data.
The month started off strong as Toyota launched aggressive incentives, which included zero-percent financing and attractively discounted lease prices, and other automakers followed suit. But the great deals look as if they fizzled by month's end. That raises the question -- even if automakers continue heavy incentives through April, will they be effective?
Toyota's troubles, which have rubbed off on Honda in terms of sales, have opened the door even wider for up-and-coming Hyundai.
An analysis by AutoObserver.com shows that three Hyundai models - the redesigned Hyundai Sonata, revamped Hyundai Tucson and still relatively new Hyundai Genesis sedan - have, in short order, have charged into the Top 10 of Most Shopped vehicles on Edmunds.com.
The first quarter of 2010 marked the first time ever that a Hyundai model captured the No. 1 spot on the Most Shopped list since Edmunds.com began tracking shopping consideration data in 2007.
And two Hyundai models scored that accomplishment multiple times during the quarter. The new Hyundai Sonata, just arriving in showrooms in volume, has been the No. 1 Most Shopped vehicle on Edmunds.com for two weeks running in March. The Hyundai Tucson was No. 1 for two weeks in the 2010 first quarter. The Hyundai Genesis eked into the Top 10, making Hyundai the only other automaker besides Honda to have three vehicles among the Top 10 Most Shopped.
Everyone's certain to be sensitive to the industry "mood" at this week's New York auto show. Projections for March's Seasonally Adjusted Annual Rate are calling for hefty leaps over February, as well as compared with the same time last year when the auto industry had reached its depths.
However, with March sales figures pumped by oversized incentive spending incited by Toyota Motor Corp. and more large-scale fleet purchases, some analysts suspect March performances may be painting an artificial picture of a rebound that isn't there - or at least isn't sustainable.
So with all this background - not to mention gasoline prices steadily inching upward - automakers and industry watchers will be looking at the New York show for even the subtlest of signals, much the same way the finance industry hangs on every word of the latest Federal Reserve meeting.
The post discussed how the gas-price spike of 2008 followed by the economic disaster of 2009 have prompted baby boomers to re-evaluate their vehicle choices. Luxury vehicles, once thought to be their obvious choice, is no longer the automatic selection. The post was an excerpt from a speech delivered by Michelle Krebs, Edmunds.com senior analyst and editor at large, to the Seventh Annual What's Next Boomer Business Summit in Chicago, discussed .
Hefty incentives, spurred by Toyota with others following, are forecasted to send the Seasonally Adjusted Annual Rate of vehicle sales to 12.4 million this month from February's 10.3 million, according to Edmunds.com.
Toyota will get a big bang for its incentives bucks with sales up 80 percent from February, Edmunds.com forecasts. And Ford is expected to outsell GM again in March as it did in February.
"Although this SAAR sounds promising, it's too early to wave the flag and say that the economy has turned the corner," Edmunds.com CEO Jeremy Anwyl said. "Incentives drove sales this month, but those incentives were defensive moves by Toyota and its competitors, and are unlikely to last because inventories are simply not high enough to justify them."
The tide of public perception may be turning in favor of Toyota Motor Sales USA after investigation of a highly publicized crash of a Prius hybrid electric vehicle in Harrison, New York, last week demonstrated the driver -- who claimed the car accelerated unintentionally -- was flooring the accelerator rather than the brake pedal.
The case follows that of Prius driver James Sikes earlier this month in which Sikes claimed his Prius took him on a minutes-long, 90-mph-plus unintentionally accelerated ride on a San Diego freeway. As with the latest New York report of unintended acceleration, investigation by Toyota and the National Highway Traffic Safety Administration (NHTSA) refuted Sikes' claim that prolonged heavy application of the brake pedal would not slow his car.
The staff at Edmunds is a diverse group with hundreds of different perspectives on the auto industry and the world at large.Here's a look at what we're reading and thinking about this week...
Everyone has known about checklists but this book takes it to a new level. The author backs up his points with evidence from working in the medical industry.
Edmunds staffer says: This book is an entertaining account of a simple tool for getting things done. If checklists save lives, they can also help you get things done in your life. -- Phil Reed, Sr. Consumer Advice Editor, Edmunds.com
A mid-month look at March auto sales indicates a Seasonally Adjusted Annual Rate that is flirting with 13.2 million vehicles, thanks largely to intense incentive competition, according to Edmunds.com.
"The industry has been recharged by incentives offers from Toyota and other automakers who responded in kind," said Edmunds.com Senior Analyst Jessica Caldwell. "There is a lot of money in the marketplace right now, and people are responding."
It's definitely not what a battered auto industry wants to hear after months of scrabbling for the start of a rebound, but analysts at Edmunds.com project, through the new True Market Value Predicted Price Trends metric -- that average transaction prices, even for plenty of usually strong-selling models, will fall in April.
Common sense might suggest with improving weather and the coming of spring that auto sales would tend to start increasing in April, but historically, such is not the case. Analysts at Edmunds.com note that in just the past eight years, sales have declined in April from March in seven of those years. Hand-in-hand with a decline in sales volume comes a typical reduction in average transaction prices during April.
April also is a poor springboard for auto sales because there are no long holiday weekends and the month holds, for many, the ominous prospect of filing tax returns.
Overall vehicle dependability has improved 7 percent and for the first time in more than a decade, a domestic vehicle is the industry's dependability leader, says the latest Vehicle Dependability Study from J.D. Power and Associates.
Power's latest version of its widely-watched dependability study was based on 52,000 responses from owners about their experience over the last year with their 3-year-old, 2007-model vehicles.
General Motors Co.'s Cadillac DTS was the study's leader, beating all individual models with 76 problems per 100 vehicles; the industry average was 155 problems per 100 vehicles, a 7-percent improvement over the average 165 PP100 reported by owners last year.
Porsche was the overall nameplate leader at an average of 110 problems per 100 vehicles and Ford Motor Co.'s Lincoln brand climbed six rungs since last year to finish in second place with a 114 PP100 rating. Overall, 25 of 36 brands improved their rating from last year and 14 brands performed better than the industry average.
If you're seeing a lot of particularly dirty Jeep Grand Cherokees these days, there might be a good reason.
Doug Newman, owner of conveyer-belt style carwash chain in Milford, Connecticut, told Bloomberg news last week the Chrysler Group LLC sport-utility is an unintended acceleration beast, accounting for all four of the unintended-acceleration incidents that have occurred at his operations since 2000.
Little more than a month ago, a worker piloting a 2006 Grand Cherokee at the Octopus carwash in Albuquerque, New Mexico, killed another worker after the driver said the Jeep accelerated uncontrollably, smashing the worker against a wall.
And a member at Edmunds.com's CarSpace social-media forum identified as Octo30yrs said the Grand Cherokee's unintended-acceleration reputation with the carwash community is such that some operations now are either pushing through Grand Cherokees or rejecting them altogether.
Edmunds.com CEO Jeremy Anwyl argues in a Washington Post OpEd that the U.S. Transportation Department and its National Highway Traffic Safety Administration should lead in coordinating an effort to get to the bottom of the industry problem of sudden acceleration. Here's his argument as published by the paper Monday:
Lately it seems that each day brings another report of a driver's terrifying experience with an out-of-control Toyota. There have been at least four congressional hearings in as many weeks.
Even the most confident consumer has to wonder what is causing all this and, more fundamentally, whether Toyotas are safe to drive.
The second question is easier to answer. Despite the flurry of reports, incidents with speeding vehicles are rare. And vehicles today, including Toyotas, are safer than ever.
James Sikes said last week the accelerator on his 2008 Toyota Prius hybrid-electric vehicle stuck open and the car took him prisoner on a 20-minute high-speed run on a San Diego freeway.
After examining and testing Sikes' Prius for two days, Toyota Motor Corp. engineers effectively are saying, "No sell."
Sikes' account of the event, in which he said his Prius accelerated of its own accord to speeds as high as 94 mph, has come under increasing skepticism in the week since it was reported, initially by Sikes himself calling 911. Now Toyota's investigation results -- although some will brand them as anything but unbiased -- add more doubt regarding Sikes' credibility.
"While a final report is not yet complete, there are strong indications that the driver's account of the event is inconsistent with the findings of the preliminary analysis," Toyota said in a press conference Monday.
Used car prices are up about 2 percent from last month, but the prices of used Toyotas affected by the recalls are down about 2.5 percent, according to Edmunds.com.
"Many used car buyers are turned off by the negative publicity surrounding the Toyota recall, so prices of those vehicles are pacing at about 4.5 percent below the market," said Edmunds.com Analyst Joe Spina.
A few articles caught my eye this week. Both pertained to women, appropriately so since March 8 was International Women's Day. They are pertinent to all auto companies as their business is employing women and marketing to women.
One article was written by former Chrysler marketer Julie Roehm on how Toyota must regain the trust of women in order to recoup its sales and image. Another was by economist Sylvia Ann Hewlett discussed women as a major emerging market in emerging markets. A a third was by University of Michigan professor Susan Douglas who contends women's equality is only a perception that doesn't mirror reality.
AutoObserver's lead item posted on Wednesday that chronicled Honda Odyssey transmission problems and owners' inconsistent response as discussed on Edmunds.com's forums was the best-read item on the site this week.
And, not surprisingly, items related to Toyota's continued recall and quality woes ranked among AutoObserver's best-read features this week.
Former National Highway Traffic Safety Administration chief and longtime auto-safety advocate Joan Claybrook called for a doubling of the agency's investigational budget in order to equip NHTSA to more effectively police an increasingly technical and complex auto industry.
Claybrook was one of a number of witnesses at hearings held Thursday by the U.S. House of Representatives examining the NHTSA's response to the recent high-profile recalls of Toyota Motor Corp. vehicles for reports of unintended acceleration,
Claybrook and Ami Gadhia, policy counsel for Consumers Union and another witness in the House hearings, also called for Congress to consider drastically hiking the limit on civil penalties NHTSA can impose to help sharpen respect for the agency's rules.
Hefty incentives offered by Toyota to rejuvenate sales and market share -- and copied by some competitors - sent U.S. industry sales soaring in the early going of March, according to Edmunds.com's forecast.
In the first eight days of March, the Seasonally Adjusted Annual Rate (SAAR) of U.S. sales climbed to 12.5 million units, the highest level since September 2008, excluding August 2009 when Cash for Clunkers was at fever pitch.
"Generous incentives from Toyota and General Motors have stimulated this boom," Edmunds.com Senior Analyst Ray Zhou, PhD. "But we anticipate that it will cool off, and that the month will end closer to 11 million or so."
Paul Fischbeck, a professor at Carnegie Mellon University and a "risk expert," noted in a release late last month that although Toyota Motor Corp. has captured the attention of the media and the driving public numerous reports linking its vehicles to unintended acceleration, driving while talking on a cell phone or even innocently walking a mile are riskier than piloting a recalled Toyota.
"There hasn't been a discussion about the actual risk of driving one of Toyota's recalled vehicles," said Fischbeck, a professor of social and decision sciences and engineering and public policy, in a statement. " I think it's important for people to realize that when you look at the actual risk of driving one of these cars, it's actually very low."
Well underway with the colossal job of attending to more than six million vehicles recalled to address either potentially sticking accelerator pedals or wayward floormats, a Toyota spokesman yesterday admitted some of the repairs may not be properly conducted.
The spokesman, in attendance of a media event where engineers demonstrated how unintended acceleration simulated by one researcher using a Toyota electronically controlled throttle system is virtually impossible to happen in real-world conditions, said the company is aware of multiple reports of continuing incidents of unintended acceleration in vehicles that had undergone the stipulated warranty repairs.
He added that only a few of the claims had been verified, but seemed to admit not all repairs are being properly carried out, saying that for some of the vehicles reported to still be accelerating of their own accord, "it had to do with the repair not being done properly."
Toyota Motor Corp. battled back yesterday against a hurricane of negative publicity and Congressional calls for action related to unintended acceleration in its Toyota- and Lexus-brand vehicles.
The controversy takes a new twist as Toyota and Exponent Inc., the high-profile engineering consultancy and troubleshooter the company has hired, demonstrated the unintended acceleration-causing conditions produced in a highly publicized test for Safety Research and Strategies Inc. conducted by Dr. David Gilbert, an associate professor of automotive technology at Southern Illinois University at Carbondale, are highly unlikely to occur under real-world conditions.
The Exponent team also showed that the design of Toyota's wiring for its electronically controlled throttle - the component suspected to be at the root of unintended acceleration - is engineered to prevent the potential for the kind of failure Gilbert's testing generated.
Toyota's zero-percent financing and special lease deals generated nearly a 40-percent spike in purchase intent by visitors to Edmunds.com.
In January, Toyota's purchase intent averaged just over 13 percent and then fell to a 9.7-percent low as a result of the recall announcements.
On March 1, Toyota purchase intent had recovered to 13 percent. A day later, when the incentives program was announced, Toyota purchase intent soared to 18 percent -- a 14-month high.
The story that Ford Motor Co. outsold General Motors Co. (by 471 units) for the first month since August, 1998, has made the rounds.
But February's sales charts served up some other noteworthy numbers. Here is a selection:
Ford and GM's totals were No.1 and No. 2 in the market, and figures for the "Big 7" automakers were rounded out, in descending order, by Toyota Motor Sales USA at 100,027; Chrysler Group LLC at 84,449; Honda Motor America at 80,671; Nissan Motor Co. Ltd. at 70,189 and the Hyundai Group (Hyundai and Kia brands combined) at 58,056.
With prime rivals Toyota Motor Corp. and Honda Motor Co. Ltd. stumbling into 2010, surging Hyundai Motor America Inc. isn't planning to give them - or anybody else - a breather: the company is launching seven completely new products in the next 24 months, starting with the formidable and all-new 2010 Tucson compact crossover.
Like just about everything else Hyundai's doing these days, the Tucson is almost certain to give its competitors fits.
February marked the first month since August, 1998, that Ford Motor Co.'s monthly sales topped those of chief rival General Motors Co., providing an unexpected jolt in a month when the broad industry was handicapped by severe winter weather in the northeast regions of the country - and by the spillover from Toyota's safety-recall debacle.
Total U.S. auto sales for the month were 779,743 units, an increase of about 13.5 percent from year-earlier sales of 687,182, when the American automotive market was at the very bottom of one of its biggest slumps ever. And the February pace represented a seasonally adjusted annual sales rate of 10.4 million units, a number at the upper middle of most SAAR projections.
"The good underlying news is that the industry hasn't gone into reverse in terms of its recovery," said Jessica Caldwell, senior industry analyst for Edmunds.com.
Despite all the questions asked during Congressional hearings on Toyota's recalls this week, the nagging question that won't -- and maybe can't -- be answered is: are today's cars safe, at least from accelerating of their own volition?
Toyota happened to be the company at the witness table for vehicles that -- for one reason or another, identified or not -- have the possibility of unintended acceleration, potentially endangering not only Toyota drivers but drivers, passengers and pedestrians around them.
Yet, while Toyota is under the microscope and, in fact, has more reported complaints than its competitors, unintended acceleration is an industry-wide problem that requires industry and government attention.
"The current emphasis in the hearings seems to be about who learned about what/when and they are skirting the core issue of what's really causing unintended acceleration in the first place. With this being an industry issue, what's called for is an unprecedented, cross-company and government safety agency collaboration to pool data and resources, getting to the bottom of the problem once and for all," said Edmunds.com CEO Jeremy Anwyl.
Despite Toyota's recall woes and snowy weather covering most of the country, February vehicle sales will be higher this February than last year's dismal lows and also higher than January's numbers, Edmunds.com forecasts. Still, February sales weren't as strong as many had hoped or expected.
February sales reports from manufacturers, to be posted Tuesday, also will show who made sales and share gains at Toyota's expense. Toyota's sales will be about even with January and down about 10 percent from a year ago. Its market share likely will fall to 12.6 percent, its lowest level since 2005.
In contrast, Hyundai and Nissan will post their highest U.S. market shares ever, Edmunds.com predicts. Ford's share increased, while market share for General Motors and Chrysler dropped.
Other than apologizing to a raft of House of Representatives lawmakers for accidents involving their constituents and pledging to improve the company's quality, communications and transparency, Akio Toyoda, president and CEO of embattled Toyota Motor Corp., didn't give Congress much to chew on after a day of exhaustive testimony in Washington, DC.
Testifying for the House Committee on Oversight and Government Reform along with Yoshimi Inaba, president and COO of Toyota Motor North America, Toyoda was hampered by the need to mostly speak through an interpreter and by delivering precious little in the way of definitive answers for House members desperate to produce public satisfaction.
Tuesday's hearing before the House Committee on Energy and Commerce into Toyota's recalls and safety record - as heated as it was - was just the warm-up act for Wednesday's big show starring Toyota Motor Corp. President Akio Toyoda, grandson of the company's founder.
The automaker already has indicated what Toyoda will say before the House Committee on Oversight and Government Reform with Op-Ed pieces published in the Wall Street Journal on Tuesday and distribution of excerpts of his speech.
Toyoda can be expected to deliver messages to Toyota customers and employees about the company's commitment to quality, to outline specific steps the company is doing in that regard and to make it personal with lines like "my name is on every car."
It was frustration, not answers, that came out of the House of Representatives Committee on Energy and Commerce investigation into Toyota Motor Corp.'s wide-ranging recalls for vehicles alleged, for different causes, to have unintended acceleration.
There were just two definitive take-aways from Tuesday's exhaustive hearing -- neither of which goes anywhere toward explaining whether mechanical, electrical or software faults could be at the root of thousands of consumer complaints of unintended acceleration and the recall of millions of Toyota vehicles.
Those two absolutes:
1. Toyota knew of an unintended acceleration trend -- evidenced in vehicles worldwide -- and now executives essentially are admitting the company underplayed its potential importance.
2. The National Highway Traffic Safety Administration (NHTSA), the governing body charged with riding herd on automakers to assure action in such matters, wasn't doing its job.
With Congressional investigators saying Toyota Motor Corp. "failed its customers" and independent engineering experts testifying electronics and software programming for electronically controlled throttles perhaps are not as foolproof as Toyota believes, the first day of testimony in hearings about millions of recalled Toyota vehicles has Toyota and the National Highway Traffic Safety Administration appearing incompetent, indifferent and perhaps even scoffing about potential dangers and consumer concerns.
Several members of the House of Representatves Committee on Energy and Commerce in a hearing on Capitol Hill Tuesday are calling Toyota dismissive and NHTSA ill-responsive and blow-offish.
Consumer Reports much-anticipated and highly-coveted Top Picks list saw fewer Toyota models in years past. The beleagured automaker ranked third overall in the magazine's company report card.
The magazine announced the results of its annual survey in Washington, D.C., early Tuesday morning as Toyota executives prepared to face Congress in hearings on its safety and recall problems later in the day. The survey results will be in the April issue on newsstands March 2.
Toyota's top U.S. sales executive will tell Congressmen Tuesday that the automaker was too slow to act on safety issues, was poor at communicating but will do better in the future.
"It has taken us too long to come to grips with a rare but serious set of safety issues, despite all of our good faith efforts," Jim Lentz, Toyota Motor Sales president and COO will tell the House Committee on Energy and Commerce. His statement, to be read to the committee, was released by Toyota Tuesday morning.
Lentz said the automaker's slow reaction has been "compounded by poor communications both within our company and with regulators and consumers."
Of the Big Six automakers selling vehicles in the United States, Toyota - as a manufacturer and as an individual brand - has the most consumer complaints filed with the National Highway Traffic Safety Administration (NHTSA) for unintended acceleration, according to an Edmunds.com analysis of the government safety agency's data bases.
Unintended acceleration will be the hot topic of Congressional hearings Tuesday and Wednesday on Toyota's recalls for sticking accelerator pedals and floormats that can trap the gas pedal. Both situations have the potential to cause unintended acceleration.
At Congressional hearings this week, federal administrators responsible for automotive safety will be on the hot seat as much as Toyota executives will be.
Amid accusations of foot dragging and influence pedalingregarding the National Highway Traffic Safety Administration (NHTSA), Toyota and their handling of consumer complaints and recalls, safety administrators likely will be grilled about what is standard operating procedure in dealing with consumers' complaints. The overriding question at the hearings will be was NHTSA lax in holding Toyota's feet to the fire on vehicle problems. Edmunds.com's analysis of NHTSA databases reveals little consistency in dealing with consumer complaints. The analysis shows no clear pattern in terms of the number of consumer complaints that trigger an agency investigation. The length of time it takes from an investigation to a recall being issued varies widely.
Whether NHTSA's process works properly and quickly enough and whether it is transparent enough is highly questionable. Ultimately, this week's Congressional hearings may be as revealing in uncovering defects at NHTSA as defects in Toyotas.
Toyota Motor Corp., girding for what is certain to be a combative inquest from two separate House of Representatives committees this week, will not be starting off on the right foot after leaks of internal memos that could be construed as gloating about coercing favorable regulatory reaction to reports about potentially unsafe vehicles.
Most damning, perhaps, is a memo outlining a presentation in which a company executive lists as a "win" efforts that negotiated a fairly low-level recall of some 55,000 vehicles in 2007 to replace floormats.
This week, Toyota President Akio Toyoda and other Toyota executives are scheduled to testify before two Congressional committees regarding the automaker's recall of millions of vehicles. The committees, which will hear from other industry experts as well, will attempt to answer the question of whether the public is at risk.
Toyota's recalls have generated massive amounts of global media and dozens of lawsuits. Toyota has hired a crisis management team to help with the hearings and the public relations effort that got off to a bungled start.
For a glimpse of what might be going on behind the scenes leading up to the hearings and how the hearings might play out, AutoObserver turned to Ford public relations veteran Jon Harmon, now an author and crisis management consultant. His book, Feeding Frenzy, published last October, tells the riveting behind-the-scenes story of the deadly rollover accidents involving Ford Explorers equipped with Firestone and subsequent recalls. Like Toyota is now, Ford faced intense media scrutiny, aggressive trial lawyers and an angry U.S. Congress.
Here's an excerpt covering Ford's preparation for and experience in Congressional hearings:
After initially saying he would let executives from the company's U.S. operations handle appearances at two separate hearings in the U.S. Congress next week, Toyota Motor Corp. president and CEO Akio Toyoda abruptly changed course and announced he will put in a personal appearance.
Two House of Representatives committees will stage hearings on Tuesday and Wednesday next week regarding Toyota's high-profile -- and some say alarming -- recalls for sticking accelerator pedals and floor mats that have the potential to cause "unintended acceleration" in millions of Toyota vehicles.
Earlier in the week, the House Committee on Oversight and Government Reform -- whose hearing is on Wednesday at 10 a.m. Eastern time -- invited Toyoda to appear at its hearing. Toyoda declined, as he also had for a Senate hearing scheduled for March 2.
But now Toyoda -- the grandson of the company's founder who became president and CEO in January, 2009 -- confirms he will appear at the House Oversight Committee's hearing next week.
The National Highway Traffic Safety Administration is launching a formal investigation into consumer complaints regarding steering on 2009-2010 Toyota Corolla models, an investigation that may lead to a recall of the bestseller.
The agency said it had received 150 complaints. Toyota Executive Vice President Shinichi Sasaki told reporters in Japan this week that NHTSA had received more than 80 online complaints. NHTSA's inquiry will cover 500,000 vehicles.
The Washington Post cited one complaint on a 2010 Corolla read: "When driving on the highway (60+ mph), the vehicle will all of a sudden start to wander back and forth in the lane, for a few hundred yards. Then as quickly as it started, it stops. The wandering has almost created four collisions so far."
Toyota's president of U.S. sales, Jim Lentz, will testify at the first U.S. House hearing on Toyota's recalls next week, rather than the originally planned appearance of the company's North American president Yoshimi Inaba.
Toyota has been called to testify at two congressional hearings next week. The House Energy and Commerce Committee moved up its hearing by two days to Tuesday, February 23. Toyota said the date change would require Inaba to alter his travel plans. He will testify at a February 24 hearing before the House Oversight and Government Reform Committee, she said.
Toyota President Akio Toyoda said he does not plan to testify at any of the Congressional hearings.
Toyota's dilemma should be thought of as a parable that applies to the entire industry, writes GaveKal, a Hong Kong-based financial services, macro-economic firm.
Why? Two reasons, says GaveKal in an excerpt from the company's recent report posted here with permission: the witch hunt is on and cost-cutting has a downside for all.
Toyota Motor Co. President Akio Toyoda, in a press conference held in Japan, said he would personally lead a global task force to improve quality-control management, but he would not appear at Congressional hearings in Washington next week.
In his third news conference in two weeks, Toyoda also said the automaker is examining steering complaints on its Toyota Corolla. A recall of the Corolla, one of the world's best-selling cars, is possible.
Toyoda further confirmed the automaker plans to install brake-override systems in its future models. He said Toyota also will make better use of the onboard black boxes in its vehicles to alert management to problems.
With the first of a series of Congressional hearings only a week away, posturing by Toyota and the federal safety agency in charge of watching Toyota and other automakers has begun.
Both will be on hot seats during the hearings, and both are attempting to put themselves in the best light possible between now and then.
On Tuesday, the National Highway Traffic Safety Administration (NHTSA) said it was using its statutory authority to force Toyota to provide paperwork showing when and how the automaker learned of the defects that led to the recall of million of vehicles in the U.S. The government safety agency wants to determine of the recall were conducted "in a timely manner."
At the same time, Toyota Motor Co. President Akio Toyoda is preparing to brief the media Wednesday evening in Japan. He is expected to provide detail the global task force he is leading to revamp Toyota's quality control system.
My boss reckons one consequence of Toyota Motor Corp.'s new and extraordinary quality-safety blunders is that the price of new cars is going to go up.
Edmunds.com CEO Jeremy Anwyl suggests in a piece posted Thursday on AutoObserver that consumers should prepare themselves to pay for the increased safety the furor over the Toyota revelations seems to be demanding. And they will likely have to pay for the correspondingly amped-up regulatory oversight that also will be an inevitable outcome once Washington gets involved at the end of the month.
Our vehicles have become astoundingly, statistically safe. The question of the moment is: are we willing to pay whatever's required to move them closer to being absolutely safe?
Honda, unlike General Motors, Ford and Hyundai, has steered clear of incentives aimed at specifically and blatantly at luring would-be Toyota buyers to their folds as Toyota struggles with quality and image problems.
Honda is, however, offering an attractive sub $200-a-month lease deal on the Honda Insight, obviously to go up against the Toyota Prius, which has been recalled for brake problems. The deal is so good Edmunds.com has named the promotion its lease deal of the week.
As Toyota faces plummeting sales and market share in February, its Central Atlantic Region has launched a President's Day promotion of no-interest financing for up to 60 months on a half-dozen models, including some that are covered under Toyota's recent recalls.
It's not clear if other distributors will follow suit.
Recalls, stop-sales orders and the accompanying bad press have put downward pressure on prices of new and used Toyota vehicles, but the hit is not as huge as might be expected, according to an analysis by Edmunds.com.
New vehicles specifically covered by Toyota recalls are selling for an average of 0.5 percent - or $150 per vehicle - less than earlier this year, according to the most recent adjustments made to Edmunds.com's True Market Value pricing.
Used Toyota vehicles covered by recalls are selling for about 3 percent less than earlier this year, according to Edmunds.com. However, dealers --- either being cautious or opportunistic -- are paying about 6 percent less for Toyota trade-ins than they did before the recalls were announced.
Toyota's mounting product quality and public image woes have prompted Edmunds.com to revamp its sales forecast for 2010, lowering Toyota's share and raising the share of other automakers.
Edmunds.com's most current forecast of 11.5 million vehicle sales for 2010 has Toyota losing market share that will be picked up by Ford, General Motors and Honda.
Ford's sales gain, in fact, likely will push the American automaker to the No. 2 sales spot in the United States, ahead of Toyota, Edmunds.com predicts. Toyota took the No. 2 position from Ford in 2007 and has held it ever since.
"It now seems clear that Ford will overtake Toyota to reclaim its position as the second biggest automaker in the U.S. market," Edmunds.com Senior Analyst Jessica Caldwell said at the Chicago auto show.
The column and the book are particularly appropo as mighty Toyota flounders.
In the book, as cited by the FT, businesses pass through five key stages of decline or what Collins terms as the "arc of tragedy" -- a process by which "an all-conquering company like Toyota can be brought so low."
Stern simplifies as follows Collins' five stages -- ones other automakers (Ford, Fiat, Volkswagen, come to mind) would do well to note:
After a January of piddly auto sales propped up mainly by fleet buyers didn't deliver any momentum from December's strong selling, slightly nervous automakers hoping 2010 will be a solid rebound year are looking to the Chicago auto show -- said to still be the nation's leading show in terms of bringing patrons through the turnstiles -- to stoke up winter interest.
Nobody's expecting any blowout introductions, but the Chicago show's slate of new-vehicle intros runs a wide gamut. Unveilings begin Wednesday, the first press day.
Most titillating for industry watchers is Nissan Motor Co. Ltd.'s late-in-the-game decision to return to the Chicago show. Nissan skipped the Detroit and Chicago auto shows in 2009 and came up missing again at the Detroit show last month.
No automaker should gloat over Toyota's quality woes because no automaker is free and clear on the issue of customer complaints.
In fact, an analysis by Edmunds.com of the National Highway Traffic Safety Administration (NHTSA) complaint database shows Toyota ranks 17th among automakers in the number of complaints per vehicle sold over roughly the past decade.
According to the database, which is comprised of input from individuals and is not checked for accuracy by NHTSA, Toyota was the subject of 9.1 percent of the complaints from 2001 through 2010. During this period, the company sold 13.5 percent of all new cars in the United States.
Land Rover ranks first among automakers, with 0.6 percent of the complaints compared to only 0.1 percent market share from 2001 through 2010.
The following chart sets forth the results for all automakers in this research:
State Farm insurance warned U.S. regulators repeatedly of a rise in vehicle-accident claims involving Toyota vehicles and uninntended acceleration as far back as 2007, according to various media reports coming out of Washington Tuesday, a day before Toyota's top U.S. executive is scheduled to testify before the House oversight committee.
The nation's largest auto insurer saw an increase in reports of unwanted acceleration in Toyotas from its database of 40 million customers and told the National Highway Traffic Safety Administration (NTHSA) in 2007, the company confirmed.
Interestingly, State Farm also was first to sound the alarm on the deadly rollovers of Ford Explorers with Firestone tires in 2000.
In advance of Wednesday's Congressional hearings on the automaker's recent recalls, Toyota Motor Co. President Akio Toyoda detailed in a letter published in the Washington Post his plan to restore product quality and regain customer trust.
In the letter printed in Tuesday's edition, Toyoda, grandson of the company founder, accepted personal responsibility and apologized for the recalls, vowing to Toyota back on track.
Toyoda, who has been largely invisible during the last few weeks of recalls and negative headlines, wrote: "You have my commitment that Toyota will revitalize the simple but powerful principle that has guided us for 50 years: Toyota will build the highest-quality, safest and most reliable automobiles in the world."
Toyota Motor Co., as expected, announced Tuesday the global recall of 437,000 hybrid models, including the Toyota Prius and Lexus HS 250h, to fix faulty braking systems.
The latest recall covers four models and brings the total number of recalled vehicles for various problems to about 8 million worldwide.
Toyota Motor Co. President Akio Toyoda announced the hybrid recall at a press conference in Japan Tuesday. As he did at a press conference last Friday, Toyoda, grandson of the company founder, apologized for causing customers to worry about Toyota's quality and safety and vowed to "redouble our commitment to quality."
Last Friday's press conference held by Toyota's chief executive Akio Toyoda has generated plenty of buzz. Much has been made in the Western and Japanese media about whether or not his "apology" -- and even his bow at the start of the conference -- demonstrated true contrition. And there's been various interpretation of his words -- was he sorry for the quality problems or sorry for the concern it caused.
In a recent column in the Wall Street Journal, Jeff Kingston, director of Asian Studies at Temple University Japan, discusses the uniqueness of the Japanese business culture that led to what the headline describes as "A Crisis Made in Japan."
Careful -- at least at the moment -- what you call it when it comes to fixing hybrids. You might want to say "recall," but Ford's got a better idea, to coin a phrase.
Almost in lockstep with embattled Toyota Motor Corp. reportedly on the verge of announcing a recall or brake software recalibration on its Prius, Ford Motor Co. also announced a decision last week to reprogram the braking strategy for its Fusion Hybrid and Mercury Milan Hybrid.
In his first public appearance since Toyota's quality issues captured global headlines, Akio Toyoda, Toyota Motor Corp. CEO and grandson of the company founder, told the media in Japan Friday that Toyotas insisted are safe to drive and customers remain the automaker's top priority. He apologized for causing customers' worry.
"The fact that we have caused such concern is a cause of regret for us," he said in the press conference, which was not aired globally but was blogged live by the Wall Street Journal. "We are all working in unison to establish confidence again ... We have to earn back the trust of our customers."
Toyoda said he has spoken with U.S. Transportation Secretary Ray LaHood, who earlier this week announced he wanted to talk with the Toyota CEO. However, Toyoda would share little of those discussions. "We aim to cooperate fully with the U.S. authorities," he said.
In response to customer complaints about unusual brake feel, Ford has announced it will update software on the brakes of some 2010 Ford Fusion Hybrids and 2010 Mercury Milan Hybrids.
"We have received reports that some drivers have experienced a different brake feel when the hybrid's unique regenerative brakes switch to conventional hydraulic braking," Ford's statement issued Thursday afternoon said. "While the vehicles maintain full braking capability, customers may initially perceive the condition as loss of brakes."
Ford's announcement comes as Toyota tries to figure out what to do about complaints regarding the Toyota Prius' brakes.
Despite recalls, stop-sales orders on some of its best-selling models and other mounting quality concerns, Toyota announced Thursday it had earned money in the previous quarter and raised its earnings forecast for the year, saying it will return to profitability this year.
Toyota's profit forecast comes as the automaker's quality issues are increasing. Toyota's latest quality problem involves its high-profile Prius -- the world's best-selling hybrid car -- that company executives admitted Thursday has brake issues.
January car sales had automakers jousting for new positions in the sales rankings.
General Motors retained its No. 1 sales spot. But Toyota's recall and stop-sale order on eight of its best-selling models caused the Japanese automaker to slip to No. 3, behind Ford.
Ford had lost the No. 2 sales spot to Toyota in 2007 and has been fighting to win it back. It closed 2009 by slashing in half the gap with Toyota. This could be the year with Ford gaining momentum and Toyota in reverse with its quality woes.
Transportation Secretary Ray LaHood publicly recommended that owners of recalled Toyotas should stop driving them during Congressional hearings on Wednesday. Then he backtracked on his statement in later in interviews, only adding to the confusion Toyota owners are experiencing.
"This flip-flop is not helping concerned motorists who are being presented with confusing and contradictory information about the Toyota recall at every turn," stated Edmunds.com CEO Jeremy Anwyl.
U.S. Transportation Secretary Ray LaHood said owners of Toyota vehicles recalled for accelerator-pedal defects should "stop driving" them and bring them to a Toyota dealer for repair.
"We need to fix the problem so people don't have to worry about disengaging the engine or slamming the brakes on or put it in neutral," LaHood told a House Appropriations panel hearing in response to questions from a lawmaker.
"If anybody owns of these vehicles, stop driving it and take it to a Toyota dealer," he added.
The U.S. auto market in January continued its recent strengthening trend, with overall sales just shy of 700,000 vehicles (698,456 vehicles) for the month rising by nearly 7 percent compared with 654,757 vehicles in a very weak January 2009. The seasonally adjusted light-vehicle sales rate ticked up to about 10.76 million units versus last year's 9.59 million - and roughly in line with the firming picture of recent months.
Toyota was clearly the biggest loser in January due to its recalls and stop-sales order on eight of its bestsellers. Yet, January's results varied widely for its top competitors that may have tried to take advantage of Toyota's problems with special incentives meant to lure disaffected Toyota customers in particular.
Since announcing the fix for its sticky pedals Monday, Toyota already is experiencing a dramatic rise in purchase intent among shoppers on Edmunds.com's Web site.
"Toyota purchase intent fell from 13.9 percent of Edmunds.com car shoppers to 9.7 percent during the height of the recall frenzy," said Edmunds.com Senior Analyst David Tompkins, PhD. "Toyota purchase intent is back to 11.8 percent and seems to be climbing steadily."
Incentives paid by manufacturers in January dipped below year-ago and December levels despite last-minute promotions by Toyota's competitors to capitalize on the automaker's recall woes.
The average incentive was $2,382 per vehicle sold in January 2010, down $160, or 6.3 percent, from December 2009, and down $326, or 12.0 percent, from January 2009, Edmunds.com estimates.
"January incentives were not particularly generous or compelling - until some automakers began trying to conquest unsettled Toyota owners and shoppers late in the month," stated Jessica Caldwell, director of Industry Analysis for Edmunds.com. "January sales numbers are up from a year ago largely because of fleet sales."
Smelling "blood in the water" as NBC Today's show host Matt Lauer noted in a Monday morning interview with Toyota's top executive, Toyota's competitors have launched a host of incentives aimed at luring into their folds once-loyal, but now-shaken Toyota owners and shoppers who are concerned about Toyota's latest recalls, stop-sales and halt of production of its eight best-selling models. Toyota announced a fix to the problem on Monday.
Sales results posted by all automakers in the U.S. Tuesday will reveal if these shark-like maneuvers are working. Meantime, the promotions themselves have been earnings mixed reviews by visitors to Edmunds.com's sites.
Jim Lentz, a Toyota sales exec who rose through the ranks to become Toyota Motor Sales president and COO in the U.S., faces his hardest sell yet: convincing Toyota buyers that their cars are high quality and safe.
Lentz, who stars in the company's video aimed at consumers and located on the automaker's Web site under the "recall update" section, is the front man for explaining the remedy for Toyota's latest recall that covered 2.3 million vehicles, in addition to a 4.2- million recall late last year. The automaker had largely gone silent in recent days after announcing the recall, stop-sale and production halt of eight of its most popular models mid last week.
On Monday, however, Toyota is covering the airwaves and the headlines. Lentz kicked off a host of interviews on national media with an appearance on NBC's "Today" show. He'll be on a number of other networks, including MSNBC and CNN, before hosting a media conference call at 11 a.m. Eastern.
Toyota Motor Corp., its reputation for unparalleled quality challenged by a recall of millions of vehicles for potentially unsafe sticking accelerator pedals, said Monday its engineers have devised a modification for the electronically controlled accelerator-pedal modules that the company can begin to deploy in a week or so.
"Nothing is more important to us than the safety and reliability of the vehicles our customers drive," said Jim Lentz, president and Chief Operating Officer, TMS. "We deeply regret the concern that our recalls have caused for our customers and we are doing everything we can - as fast as we can - to make things right."
Lentz was scheduled to appear on NBC's "Today" show Monday morning. He will hold a news briefing later in the morning.
Toyota-brand sales will drop 75 percent during the sales suspension of its eight best-selling models and some potential Lexus and Scion sales will be collateral damage.
"As long as sales of recalled Toyota models are suspended, Toyota will suffer about a 75 percent hit in sales," said Edmunds.com Senior Analyst Ray Zhou, PhD.
Even though no Lexus of Scion models are covered under the sticky gas pedal recall and sales suspension, their sales may be down as well.
"During this period, Scion may be down about 20 percent and Lexus may be down about 10 percent because of damage to the Toyota corporate brand," added Zhou.
Toyota's market share in January is expected to plummet to lows not seen since 2006, because the automaker issued a stop-selling order on eight models representing more than half of the automaker's U.S. sales this week.
Toyota's share is likely to drop to 14.7 percent of U.S. sales in January, Edmunds.com forecasts; the last time it was that low was March 2006 when its share was 14.2 percent.
In contrast, Ford is expected to have its best month for market share since May 2006. Edmunds.com forecasts Ford's share at 18.0 percent in January. The last time it was that high was in May 2006 at 18.4 percent.
In total, U.S. sales in January, buoyed by hefty hikes in fleet sales and offset by lower retail sales, will total of 701,000 vehicles, according to Edmunds.com's forecast. That would put the Seasonally Adjusted Annualized Rate (SAAR) of car sales at 10.7 million vehicles, down from 11.2 million December but up from 9.6 million in January 2009.
Akio Toyoda, grandson of the founder of Toyota who was named president and CEO of the company last year, made his first public comment about the massive recall that led to a stop-selling order of eight popular models in the U.S. this week.
"I am deeply sorry," Toyoda said in a brief interview with the Japanese network NHK as reported by ABC News. Toyoda was attending the famous economic conference in Davos, Switzerland.
He apologized to customers for causing them worry. He said he could not answer questions because the company "was still investigating," but he hoped to provide customers with an explanation soon. "I would like for people to trust us," he said.
Elkhart, Indiana's CTS Corp., the supplier at the unfortunate nucleus of a massive recall involving eight Toyota Motor Corp. models and that also has forced Toyota to suspend production of new vehicles, reportedly has redesigned the component and is ready to begin production of the redesigned parts, according to a report from Reuters and confirmed by Toyota in a statement.
"We have the fix. It is a much more robust pedal that is meeting the tougher specifications from Toyota," CTS Chief Executive Vinod Khilnani said.
Not yet known, however, is if the redesigned accelerator pedal module also will be the remedy for the 2.3 million existing models affected by the recall.
A top Toyota executive, in a briefing with Edmunds.com staffers, clarified some points of the automaker's recent actions regarding the recall and subsequent sales and production suspension of eight best-selling Toyota-brand models. He described symptoms that suggest unintended acceleration in these vehicles could occur and provided an update on a remedy for the problem.
Meantime, Toyota expanded its stop-sale to Europe and Asia as well as to the U.S. Toyota Corolla/Matrix-based Pontiac Vibe, a model from a brand that General Motors has discontinued. The Vibe had been built at the New United Motor Manufacturing GM-Toyota joint venture plant in Fremont, California, that is being closed by Toyota. Toyota also added about 1 million vehicles to the floormat recall initiated last fall.
Dealers are receiving more detailed information from Toyota regarding the recall and sales suspension of the eight models with possible sticking accelerator pedals, a problem Toyota blames on a supplier.
Dealer sources have provided Edmunds.com, parent of AutoObserver.com, with documents they received from Toyota Tuesday that provide more specifics on just which vehicles are or are not included in the lastest action, how to inspect the pedal for the supplier that produced its accelerator mechanism, and what dealers should do with the vehicles on their lots and brought in by customers.
Vehicles affected are equipped with an accelerator mechanism produced by an Elkhart, Indiana-based supplier, CTS Corp. Others equipped with a mechanism made by Japanese supplier Denso are not affected.
In an unprecedented move, Toyota announced Tuesday that it was suspending sales and production of eight Toyota-brand models -- some of its bestsellers -- due to safety concerns regarding sticking accelerator pedals on vehicles that only last week were covered in the company's latest recall.
"Helping ensure the safety of our customers and restoring confidence in Toyota are very important to our company," said Group Vice President and Toyota Division General Manager Bob Carter. "This action is necessary until a remedy is finalized. We're making every effort to address this situation for our customers as quickly as possible."
Vehicles that will not be for sale temporarily are the: 2009-2010 RAV4; 2009-2010 Corolla; 2009-2010 Matrix; 2005-2010 Avalon; certain 2007-2010 Camry; 2010 Highlander; 2007-2010 Tundra; and 2008-2010 Sequoia.
No Lexus Division or Scion vehicles are affected by these actions. Also not affected are Toyota Prius, Tacoma, Sienna, Venza, Solara, Yaris, 4Runner, FJ Cruiser, Land Cruiser and select Camry models, including all Camry hybrids. Those models will remain for sale.
In addition, Toyota also said it will halt production of the affected vehicles beginning the week of Feb. 1. Toyota did not say how long plants would be idle.
Discussion of Toyota quality and recalls on Edmunds.com has heated up again after the automaker's announcement last Thursday that it is recalling another 2.3 million vehicles.
In Edmunds' CarSpace Forums, Toyota owners are sharing personal experiences with what they say or wonder are accelerator issues in Corollas and Camrys - even some Siennas, despite the fact that the minivan isn't covered by the recall. One comment signs off as "Afraid Camry Owner."
Others defend Toyota, citing its history of quality and the customers' own good experience with their vehicles. Some readers blame recent problems not on Toyota but on suppliers and the American assembly of Toyota vehicles.
It's a debate that Toyota no doubt would like to end. But so far even the company's best public relations efforts appear to have led only to mounting consumer mistrust and an increasing lack of confidence in its vehicles.
The Ford Fusion Hybrid earned 26 percent of the votes, closely followed by the Toyota Prius with 23 percent.
"Ford's midsize hybrid sedan, which helped boost Ford's overall sales performance in an otherwise dismal 2009, has been praised for its smooth operation, fuel economy, looks and interactive information system that helps drivers modify their behind-the-wheel behavior to increase fuel economy," according to Edmunds' GreenCarAdvisor.com Senior Editor John O'Dell.
Toyota issued another major safety recall late Thursday -- this one for 2.3 million Toyota- brand vehicles to correct sticking accelerator pedals.
The newest recall is in addition to an ongoing recall of 4.2 million Toyota and Lexus vehicles for sticking gas pedals due to the wrong floormat being in the car or an improperly placed floormat. About 1.7 million vehicles are covered by both recalls.
Toyota vehicles listed in the latest recall represent the biggest sellers for the automaker once known for bulletproof quality. In fact, the models covered under the recall account for more than two-thirds of Toyota brand's sales.
They are the: 2009-'10 RAV4, Corolla and Matrix; 2005-'10 Avalon; 2007-'10 Camry; 2010 Highlander, 2007-'10 Tundra and 2008-'10 Sequoia.
The 2010 North American International Auto Show is one of the most restrained editions of the Detroit confab many can remember.
But the show's comparative scarcity of high-impact concept and production vehicles didn't stem the avalanche of opinion on the most notable vehicles.
After scores of media outlets have weighed in, AutoObserver cuts through the clutter to give the real score on the 10 most significant - for better or worse - vehicles of the 2010 Detroit auto show.
Most of the energy at this week's Detroit auto show epicentered at Ford Motor Co.'s display, with eddies splashing out to General Motors Corp.'s guardedly optimistic stand and Audi AG's gleaming base of operations.
But the majority of automakers were laying low, and media crowds were visibly reduced at the show with a reputation for over-the-top product introductions and boastful talk about the coming year.
There was no avoiding the 2010 Detroit auto show's subdued and geared-down mood, fashioned from the collective attitude of automakers licking their wounds and hoping the worst is past.
It also was yet another evolution of the show itself: there was plenty of room thanks to fewer automakers opting to display and fewer journalists opting (or fewer existing) to attend. A surprisingly expansive area of main-floor real estate was occupied by seemingly inappropriate electric vehicles of all manner, few of them of the road-going passenger variety.
Thanks to the beat-down 2009 threw on almost every automaker, the 2010 installment of the North American International Auto Show in Detroit this week isn't expected to be one of the more ebullient in the storied show's history.
Most makers are laying low. And that's the ones who are even coming. Like last year, many automakers are taking a pass: Nissan and Porsche, for instance.
Many makers let the hometown companies make the biggest splashes, but Chrysler, for one, is displaying vehicles but having no press conference (our hopes remain Chrysler will import some Italian food to feed the media masses).
You can get a rundown of what will be displayed at the Detroit show at Edmunds.com's Inside Line. But we're adding a new twist: in addition to a scorecard of what some automakers are showing at the Detroit auto show, AutoObserver is adding what each automaker ought to be showing.
U.S. auto sales in December accelerated to their best pace of the year outside last summer's Cash for Clunkers bonanza, providing a hopeful punctuation mark to the industry's worst year in decades.
Sales in December totaled 1,010,003, up 1.9 percent from December 2008, when automakers and American consumers were newly stunned by the economic debacle unfolding on several levels around them.
Some day, automakers hope to look back on 2009 as the year that both sales and corporate fortunes finally bottomed out. It's far too early to tell if history will treat last year that way, but for now, at least, the industry is taking heart from a definite surge of sales momentum as the decade closed.
Automakers sold about 10.4 million units last year, a disastrous tally that comprised the lowest total of light-vehicle sales in this country since 1970.
Not only is 2009, one of the single most tumultuous years for the auto industry, drawing to a close, but so is the first decade of a new century.
As the year winds down, data analysts at Edmunds.com are cranking away at numbers that are certain not only to entertain but also demonstrate how cataclysmic 2009 turned out to be, particularly viewed through the prism of a closing decade's worth of sales-performance trends: market share destroyed, market share gained. Years of growth turned upside down. Surprising sales-volume gains, foreboding losses.
The ever-present import-versus-domestic battle in almost startling perspective.
The best thing that might be said about the year the auto industry - and an economically battered nation - is preparing to close: it probably can't get any worse.
The year 2009 brought two high-profile bankruptcies, billions of dollars in government bailouts and funding for Cash for Clunkers and thousands of lost jobs. Similar upheaval - though not as catastrophic as predicted - came to the tightly integrated supplier industry. Several historic brands were relegated to the archives.
Five new models displayed at the recently wrapped-up Los Angeles auto show are generating tremendous buzz on Edmunds.com. The five most talked-about vehicles are the Buick Regal, Ford Fiesta, Hyundai Sonata, Toyota Sienna and Cadillac CTS coupe.
The Ford Fusion Hybrid, Buick LaCrosse and Volkswagen Golf are finalists for the 2010 North American Car of the Year awards. Finalists for the 2010 North American Truck of the year are the Subaru Outback, Chevrolet Equinox and Ford Transit Connect.
The half-dozen finalists for the prestigious awards were announced Wednesday at an Automotive Press Association luncheon sponsored by organizers of the Detroit auto show, where the winners will be announced in January.
With the doors closed last weekend on the 2009 Los Angeles auto show, the vehicles that premiered there will soon be arriving in dealer showrooms. What ones will sell in the marketplace?
To answer that question, AutoObserver watched the behavior of Edmunds.com visitors who came to the car-shopping Web site for vehicle information and turned to Edmunds.comstaffers who covered the show.
Edmunds.com visitors appeared most interested in the Buick Regal, Chevrolet Cruze, Ford Fiesta, Hyundai Sonata, Mazda 2 and Toyota Sienna, with those vehicles seeing the biggest rise in shopping consideration.
U.S. auto sales clocked in about flat in November compared with a year ago -- and in line with widespread expectations that the market will only gradually creep upward for at least the next year. But industry executives and analysts mostly chose to interpret the American auto market as a glass half-full.
November sales were 746,544 vehicles compared with 743,605 in November, 2008. On an absolute basis, that number of units represented a 0.4-percent year-to-year monthly sales increase -- or call it flat. But taking into account the fact that the industry enjoyed two fewer "selling days" this year compared with last November, sales actually increased by 9.1 percent last month on an apples-to-apples basis.
Higher Incentives on 2010 models, luxury cars, Hondas, Toyotas and General Motors' orphan brands along with an increase in leasing and lease deals pushed the average automaker incentive in November beyond that of October and that of November a year ago.
Edmunds.com estimates the average incentive at $2,713 per vehicle sold in November, up $52, or 1.9 percent, from October , and up $32, or 1.9 percent, from November 2008.
"With inventories of 2009s being cleared away and 2010 models hitting dealership lots in greater -- more normal -- numbers for this time of year, incentives on those new models are increasing," stated Jessica Caldwell, Director of Industry Analysis for Edmunds.com.
Toyota Motor Corp. said Wednesday it will repair and replace accelerator pedals on 3.8 million recalled Toyota and Lexus vehicles in the United States to address the issue of pedals being jammed by the floor mat, potentially causing unintended acceleration.
As an interim step, Toyota said it will have dealers shorten the length of the accelerator pedals beginning in January while the company develops replacement pedals, to be available in April. Some vehicles will have an engine management system-based brake override installed as well.
Based on Edmunds.com's re-enactment of the floor mat-pedal situation, these fixes should alleviate the problem.
General Motors last week began sending out 1.8 million pieces of direct mail to what the automaker calls its "free-agent customers" -- customers orphaned by the wind-down of Pontiac and Saturn and the proposed sell-off of Hummer and Saab.
In this first of promised multiple mailings, GM is offering discounts of up to $2,000 on certain models to the nearly 1 million customers of closed GM dealerships, if they go to the next closest dealer by January 4. The automaker also is giving customers of closed dealerships a vehicle inspection and tire rotation at remaining dealerships through May.
"The challenge for us is to grab those customers by the hand and make sure they know where to go," Susan Docherty, GM's vice president of U.S. sales, said in a media conference call last week.
But GM's competitors also are eyeing those up-for-grabs customers.
The distractions for much of the year surrounding the Volkswagen Group's ownership tussle with Porsche AG didn't stop VW from achieving a significant global milestone: VW this month surpassed Toyota Motor Corp. as the world's largest vehicle manufacturer.
The United Kingdom's Guardian newspaper reports IHS Global Insight figures as indicating Volkswagen (now with Porsche included) production hit 4.4 million units for the year, easily shouldering by Toyota and its production of about 4 million units year-to-date.
Analysts have noted this event was not unpredictable; in the face of a global dropoff in demand, Toyota had made the decision to drastically curtail production in the early part of the year, a move that removed as much as 1 million units or more from Toyota production schedules.
Volkswagen, meanwhile, has been the beneficiary of large-scale stimulus efforts in China and many European countries trying to prop up flagging new-vehicle sales.
Incentives paid by automakers dipped in October from September and a year ago as they launch new 2010 models, which don't need them yet, and wind down 2009 models, Edmunds.com reports.
The average automotive manufacturer incentive in the U.S. was $2,468 per vehicle sold in October 2009, according to Edmunds.com analysis of Total Cost of Incentives (TCI). That's down $329, or 11.8 percent, from September, and down $209, or 7.8 percent, from October 2008.
"Incentives declined because fewer old model-year vehicles were sold in October, and the newer vehicles are not discounted nearly as heavily," explained Jessica Caldwell, director of industry analysis for Edmunds.com. "Over 55 percent of vehicles sold in October were 2010 model year, compared with about 36 percent in September."
Automakers report October sales on Tuesday and those reports are likely to show some signs of life.
Edmunds.com forecasts the Seasonally Adjusted Annualized Rate (SAAR) of car sales will come in at 10.3 milllion to 10.4 million, the year's highest level aside from the summer's Cash for Clunkers months of July and August.
Toyota's Bob Carter told reporters in Detroit Monday that he expects the SAAR to come at between 10.3 to 10.5 million units. "Toyota will be up single digits on a daily selling rate basis versus September and down slightly - single digits - versus a year ago," Carter said. Edmunds.com forecasts Toyota sales will be off 9.6 percent from a year ago.
Sometime right after the middle of this decade, just about everyone decided luxury crossover vehicles were going to be the industry's next big profit center.
Sales of traditional body-on-frame SUVs were falling off after a brief but consumer-mindset-shifting run-up of gasoline prices in the summer of 2006. The fuel-price scare came just as the crossover segment was starting to swell, pumping up buyer interest in the newly "invented" alternative to the SUV (and in some cases, pickup trucks).
But better still, Americans still were snapping up luxury items at an unprecedented pace, encouraged by ballooning home prices and easy credit.
The industry's best deals right now are in luxury cars, sports cars and convertibles as well as leftover 2009 models, according to Edmunds.com.
As for brands, Lincoln, Saab and Volvo are offering great deals, as are Pontiac and Saturn, which are being discountinued completely by General Motors.
"Dealers should be open to any decent offer since they know that these vehicles, which often sell to a fashion-conscious crowd, will drop in value once the 2010 model year vehicles roll in. There will be nothing harder to sell than a 2009 convertible in winter with 2010 fast approaching," said Edmunds.com Senior Analyst Jessica Caldwell. And there is ample inventory of 2009 models, she added
After dismal September car sales due to the hangover from the government's Cash for Clunkers program, auto manufacturers have ramped up incentives in October as they have ramped up production to refill the inventory pipeline, according to Edmunds.com.
The incentives show manufacturers are extremely eager to sell off 2009 models left in inventory. But automakers are also offering incentives on newly launched 2010 models.
"This year has been a wild ride for automakers, and it's not over yet," said Edmunds.com Senior Analyst Jessica Caldwell. "No segment is unaffected by the current round of incentives, though luxury models and trucks are being discounted particularly heavily."
Low-interest financing, including zero-interest financing, and cash rebates dominate the landscape, but subsidized lease programs, almost non-existent in the past years, are proliferating as well.
Imagine having a football, baseball or soccer game and the visiting team doesn't show up.
That's sort of what's going on this week at the 2009 Tokyo Motor Show, where thanks to global belt-tightening and the ever-present perception of the Tokyo show as a home-team-dominated affair, the major U.S. and European automakers are effectively not coming to the game.
Although carrying on with the show is up to them alone, the Japanese makers have toned down the Tokyo show's typical hyperbole - even for Tokyo's typically far-out concept cars, not to mention the production or near-production unveilings. Environmental themes will dominate and any ostentatious displays of power and performance will be limited.
The affordable sport coupe that Toyota Motor Corp. desperately needs to prove it's still got passion is the same car that will symbolize how enmeshed giant Toyota has become with Fuji Heavy Industries Inc.'s tiny Subaru. And that car will be on display at the Tokyo motor show later this month.
Plans for the so-called "Toyobaru" coupe have been public since 2008, but reports of its engineering details have fluctuated and even its status as an approved production-car program has been questioned. Now with the FT-86 concept car, things seem to be solidifying, according to Peter Nunn's report at Edmunds.com's Inside Line.
Toyota may not have its version of the car in showrooms until late 2011, however.
Low gas prices and even lower demand in the luxury market have conspired to short-circuit sales of premium hybrid-electric vehicles. Now, as the fourth quarter begins to wind down a fairly lousy year for auto sales - and new 2010 models are shouldering their way onto dealer lots - automakers are piling on some fantastic incentives in the hope of clearing out leftover big-money hybrids.
Toyota Motor Corp.'s Lexus premium division, owner of the market's most-expensive hybrid in its LS 600h L, rang in October with a bulging $10,000 dealer-cash incentive on the '09 model of the flagship hybrid. The company also is offered a bounty of $1,000 to any sales associate selling an '09 LS 600h L, which starts at $106,035.
Toyota doesn't break out sales of the hybrid LS in its monthly sales reports, but sales of the entire LS line are down 53.7 percent through September as sales in almost all luxury segments continue to fade.
U.S. auto sales in September dipped to predicted lows because the Cash for Clunkers program ended in August and there weren't many buyers left, car company executives reported Thursday. They're just hoping that the market's massive "payback" via September's sales drought isn't extended into the fourth quarter.
Americans bought just 745,516 vehicles in September, a 23-percent drop from a year ago. That represents an abysmal Seasonally Adjusted Annual Rate (SAAR) of sales of just 9.2 million units - the lowest since February and roughly the laconic pace at which economically shell-shocked consumers purchased cars during the first half of the year.
And it was far below -- 41 percent, to be exact -- the relatively breathtaking sales rate of 14.1 million units that prevailed for August, when most buyers took advantage of a total of $3.5 billion in rebates under the federal government's clunkers program and purchased more fuel-efficient vehicles. September's sales volume plunged by more than a half-million units compared with August.
After five straight months of decline, incentives are on the rise again, according to Edmunds.com.
The average manufacturer incentive totaled $2,557 per vehicle sold in September, up $83 or 3.4 percent from August, Edmunds.com estimates. That was down $344, or 11.9 percent from September 2008.
This summer's Cash for Clunkers program substituted as a manufacturer incentive but with the program over and vehicle inventories being replenished, consumers aren't buying, as will be seen when automakers report September sales Thursday. Edmunds.com forecasts sales for the month will come in at only about a 9.3 million Seasonally Adjusted Annual Rate (SAAR).
Toyota's luxury division Lexus is among initial marketers to advertise on CNN's iPhone and iPod Touch application, making its debut Tuesday.
CNN followed the Wall Street Journal in charging for news on such mobile devices. The one-time fee is $1.99 for the news feeds that can be personalized by location or topic and shared by email, Twitter and Facebook, CNN said. Content includes articles, videos, photos and user-generated material. CNN said it has taken almost six months to develop the app. The Wall Street Journal begins charging $2 a week for its mobile app beginning in October.
Toyota Motor Corp. remains one of the world's best brands, according to the 2009 edition of the now heavily anticipated list of the top 100 global brands generated by international brand consultant Interbrand.
Toyota was the only automaker to crack the top 10 on Interbrand's list, coming in at No. 8. Toyota's performance does represent a decline, however, from its place as No. 6 on last year's Interbrand list.
Although Toyota is the only maker to achieve a Top 10 position on the list, automakers are better represented in the top 20: Mercedes-Benz placed No. 12 (down from No. 11 in 2008), BMW is No. 15 (losing two places from last year's rank of No. 13) and Honda scored a No. 18 rank, improving from its No. 20 position in 2008.
September's hangover from August's Cash for Clunkers program appears to be easing.
New vehicle sales for the month are expected to total 742,000 units, off 22.9 percent from September 2008 and down 41.1 percent from August when Cash for Clunkers was in full swing, according to Edmunds.com's forecast. That would put the Seasonally Adjusted Annual Rate (SAAR) of sales at 9.34 million vehicles. Automakers report U.S. sales on Oct. 1.
"The aftereffects of Cash for Clunkers are still being felt: a significant number of September sales were pulled ahead into August, and many September shoppers left showrooms empty-handed after finding low inventories and high prices," said Edmunds.com CEO Jeremy Anwyl. "However, the industry's sales rebound is gaining momentum, so there is room for a small upside surprise on sales announcement day."
At least a couple of automakers are headed into the 2010 model year donning boxing gloves.
Feisty billboards popping up across the country have the Buick LaCrosse taking dead aim at Lexus ES 350. One shows the LaCrosse with the line "Another thing for Lexus to relentlessly pursue" in a play on Lexus' ad tagline.
Edmunds.com has completed its final tally of the most popular vehicle purchases and most frequent trade-ins under the Cash for Clunkers. The Ford Focus held its No. 1 spot as the favorite buy; the Ford Explorer remained the No. 1 trade-in.
Indeed, the top 10 lists in both categories wound up little changed from the early scoring on Edmunds.com's lists.
And, in fact, many of the top clunker buys are the industry's bestsellers in non-clunker times. Eight of the 10 vehicles on the top 10 clunker buy list are also in the top 10 for the year so far in total; only the order is changed.
Maybe America's love affair with pickup trucks isn't over. It's just getting smaller.
In both size and volume.
The recently ended federal Cash for Clunkers incentive was a giant boost for fuel-efficient cars. They dominated the top 10 list of new vehicles purchased by those trading clunkers. But if August sales reports are any indicator, more than a few of those Cash for Clunkers vouchers were used to buy midsize (formerly "compact") pickups.
The U.S. government's Cash for Clunkers program finished its job in August, boosting industry-wide U.S. sales to 1,261,799 vehicles, a 1.3-percent increase from a year earlier and a 26.7-percent boost from July, as American consumers rushed dealerships to turn in their well-used vehicles for more fuel-efficient new ones.
Automakers revisited long-abandoned, almost heady levels of sales, with the August results translating into a Seasonally Adjusted Annual Rate of 14.1 million units - equivalent to a yearly pace about five million units faster than the sales rate for the first half of this year, and much higher than the 10.5-million to 11-million-vehicle pace that industry executives still expect to prevail for the rest of 2009.
With American taxpayers footing the bill for Cash for Clunkers, automakers were able to lower their spending on incentives in August. And, in fact, automakers may still have paid more than they needed to in incentives.
The average automotive manufacturer incentive was $2,475 per vehicle for every vehicle sold in August, Edmunds.com estimates. That's down $231, or 8.5 percent, from July and down $327, or 11.7 percent, from August 2008, continuing a downward trend of several months.
"The industry spent a record $3,165 per vehicle in March, but ever since then, incentives have continuously fallen," said Jessica Caldwell, Edmunds.com's director of Industry Analysis.
However, the story may change in the coming months, she added, with the Cash for Clunkers program over, vehicle inventories low due to production cutbacks and brisk clunker sales. But now, factories are ramping up production to fill up the pipeline again -- production that may come into a market that isn't in the mood for buying.
Toyota Motor Corp. announced late Thursday it will end its production contract at the New United Motor Manufacturing Inc. assembly plant in Fremont, CA, next March, shifting assembly of NUMMI-manufactured Tacoma midsize pickups to Toyota's recently built plant in San Antonio, TX.
The NUMMI facility was a joint-venture operation between Toyota and the General Motors Co., but in June, just prior to its Chapter 11 bankruptcy reorganization, GM said it was vacating the NUMMI operation and leaving its ownership in the venture with the "old" GM.
GM did not see a future for NUMMI and shortly thereafter Toyota also began to send signals it, too, might abandon the venture that began in 1984. GM ended production of the Pontiac Vibe (a badged variant of the Toyota Matrix) on Aug. 17.
Thanks to the government's Cash-For-Clunkers program, new-vehicle sales bounced around throughout the month of August, one of the most volatile periods in automotive history. Edmunds.com predicts the annualized sales rate could land at just more than 13 million for the month.
"Cash for Clunkers sent the sales rate on a wild roller coaster ride," said Edmunds.com Senior Analyst Jessica Caldwell. She said the Seasonally Adjusted Annualized Rate (SAAR) of sales exceeded 19 million in late July - the peak of Cash-For-Clunkers selling - and fluctuated around the 15-million mark in early August. But the SAAR has plunged to an 8-million rate in the post-Clunkers final days of the month.
"Ending August on such a low note does not bode well for September," Caldwell warned.
The case of the maybe-we're-making-it-or-maybe-we're-not Toyota-Subaru joint-venture sport
coupe was solved by new Toyota Motor Corp. president Akio Toyoda when he told reporters this week he was prioritizing development of the rear-drive car.
Although the coupe's development program was known, its status as a "live" project has been the topic of speculation. Toyoda's comment confirmed the company is committed to the project.
As the new president of the company, Toyoda, seemingly to underscore his dedication to addressing the conservative corporate culture that is perceived as holding Toyota back, said this week of the sport coupe, "I am very excited about it and I plan to put it on the fast track."
An Internet blog was entirely off-base when it suggested this week Toyota Motor Corp.'s
restructuring of its marketing organization in Japan will adversely impact the company's relationship with its U.S. advertising agencies, a senior Toyota source tells AutoObserver
.
Toyota announced it was forming two new internal marketing units, one in Japan to "primarily handle marketing within Japan," and an internationally focused unit "to carry out and assist global marketing as well as coordinate and assist the marketing activities of TMC affiliates."
Armed with more detailed 2010 model-year data regarding hybrid-electric vehicle pricing,
incentives and equipment levels that affects payback times, data analysts at Edmunds.com
are issuing revised payback times recently listed for several hybrid models.
Most notably, the battle between Toyota Motor Corp.'s new Prius and the equally new 2010 Insight from Honda Motor Co. Ltd. draws considerably closer than Edmunds.com's analysis originally reported.
Should the federal government fund a Cash for Clunkers extension, and is it worth the added
$2 billion cost as an economic and environmental stimulus?
Those are the questions the Senate considered this week as it debated the extension the House already passed. Data based on real Cash for Clunker transactions by Edmunds.com shows clearly vehicles turned in as clunkers -- mostly gas-guzzling trucks and SUVs -- would have been traded in at some point even without the program.
However, those vehicles were traded for vehicles that were more likely to be cars than trucks or SUVS and vehicles that deliver better fuel economy with the $3,500 to $4,500 government vouchers provided under the Car Allowance Rebate System (CARS).
Further, the clunker plan appears to have had a rub-off effect. The program created a feeding frenzy, with the last week of July generating a seasonally adjusted selling rate of a stunning 19.6 million vehicles. And those consumers buying vehicles regardless of trade-ins opted for smaller, more fuel-efficient cars during the Cash for Clunker program at a higher than usual rate.
In a move that may signal significant implications for Toyota Motor Corp.'s relationship with its
U.S. advertising agencies, the company said it is establishing two new internal marketing organizations, "[one that] will primarily handle marketing within Japan and a company to carry out and assist global marketing as well as coordinate and assist the marketing activities of TMC affiliates."
Whether this means Toyota is pulling the rug out from under its U.S. advertising agencies and will bring some, or all, future creation of advertising in-house via the new marketing organization -- as one media-watching Web site surmised -- remains to be seen.
Toyota reported Tuesday it lost 77.8 billion yen -- the equivalent of $819 million (U.S.) in the
most recent quarter. The loss was smaller than analysts had forecasted, suggesting the worst is over and that Toyota's full-year losses will be less than previously expected.
Toyota said it now expects to lose 450 billion yen ($4.7 billion) for the fiscal year that ends March 31, 2010. Previously, Toyota expected to lose 550 billion yen ($5.8 billion) for the year.
In a conference call with media and analysts Wednesday morning, Toyota Managing Officer Takuo Sasaki noted a dramatic drop in vehicle sales volume. "However, the introduction of demand stimulating measures by various governments, including Japan, has begun to trigger a revival in some regions," he said.
The crescendo of activity in American auto showrooms around the Cash for Clunkers program late last week produced a correspondingly huge surge in U.S. auto sales, and consumers kept scrounging through the weekend for fuel-efficient vehicles to buy under the generous government rebates.
Consequently, sales for all of July for the industry came up only 12 percent short of their level a year ago - when $4-a-gallon gasoline also was goosing shopper interest in fuel-efficient vehicles.
The race is on for which will run out first: government funding for Cash for Clunkers or the cars
popular for purchase by clunker traders.
The U.S. House handily passed a Cash for Clunkers extension that provides an added $2 billion to the program, bringing the total to $3 billion. The Senate takes up the matter this week where it faces more challenge by Democrats, who want higher fuel-economy requirements for the new vehicle bought with the clunker trade, and Republicans, who oppose more spending.
At the same time, consumers who are ditching their clunkers for the $3,500 or $4,500 credit toward the purchase of a new, more fuel-efficient vehicle face a dwindling selection and supply of the more popular vehicles.
Dozens of vehicles that are popular as clunker trades had under the ideal 60-day supply at the beginning of the month, Edmunds.com's analysis of inventory numbers showed. And those inventory levels are based on June sales -- before the Car Allowance Retail System (CARS) program kicked in July 24. More up-to-date inventory numbers won't be available until July sales are reported by manufacturers Monday.
Toyota Motor Corp. held onto the No. 1 position for global auto sales in the first six months
of this year despite being outpaced by General Motors in the second quarter. GM lost its more than seven-decade world reign to Toyota in 2008.
Toyota reported Tuesday it sold 3.56 million vehicles worldwide in the first half that ended June 30; GM sold 3.55 million. In the April-June quarter, GM sold 1.94 million vehicles, due to strong sales in China, compared with Toyota's 1.80 million.
Making Toyota's North American operations profitable again is the top prioity of the
new boss, Yoshimi Inaba. That's why he was sent back to the U.S. by new Toyota global chief, Akio Toyoda.
But that won't happen for awhile. Inaba told reporters in Detroit Thursday that Toyota in North America will not be profitable in this fiscal year, which ends March 31, 2010, but just might eke out a profit in the following fiscal year, depending on industry sales.
On the job just over a week, Inaba said he's looking at short-term, quick fixes but also studying long-term solutions to Toyota North America's financial woes.
"There is no dramatic reorganization or consolidation of our North American operations planned, but I do hope to create a stronger and better integrated regional business that can make faster decisions based on local needs," he said.
Like Sally Field when accepting her Best Actress Oscar, consumers seemed to be saying of
their new and redesigned vehicles "You like me ... you really like me."
Indeed, J. D. Power and Associates 2009 APEAL study, released Thursday, consumer satisfaction with their new and redesigned models at a three-year high. Report highlights include:
- Porsche ranked highest among nameplates for a fifth consecutive year; - Volkswagen captured four segment-level awards--more than any other vehicle nameplate in 2009; - new and redesigned models scored higher than last year's new and redesigned models and higher than this year's carryover models. - seven new and redesigned models ranked highest in their respective segments: Dodge Challenger; Ford F-150; Ford Flex; Hyundai Genesis; Nissan Maxima; Volkswagen CC and Volkswagen Tiguan.
Automakers expressed more optimism about the U.S. car market despite the fact that overall sales in June fell by 28 percent compared with a year ago, to 859,420 vehicles. That represents only a slight improvement in year-ago comparisons over results for the first five months of this year.
Jesse Toprak, executive director of Industry Analysis for Edmunds.com, characterized the month cautiously. "It means, if nothing else, that things are not getting any worse, although things are not getting that much better, either. There was a lot of volatility, but there were signs of life."
Toprak added that June was "probably the best retail-demand month of the year."
SANTA MONICA, Calif. -- Automakers spent more in June on incentives than any June on record, Edmunds.com reports.
The average automaker incentive was $2,930 per vehicle sold in June up $489 -- or 20 percent, from a year ago, Edmunds.com estimates. Incentives were down a scant $22, or 0.8 percent, from May.
"June incentives have never been higher, but we anticipate that the tide is about to turn," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "The effects of recent production cuts are starting to be felt, and as supply dwindles, incentives will fall."
The status of the New United Motor Manufacturing Inc. General Motors Corp.-Toyota Motor Corp. manufacturing joint-venture assembly plant in Fremont, California, is decided:
GM is out.
Speculation about GM's involvement in the NUMMI facility -- opened in 1984 -- began immediately after GM's filing for Chapter 11 bankruptcy reorganization on June 1. The two companies currently make individually badged versions of the Toyota Matrix/Pontiac Vibe at the NUMMI site; Toyota also makes versions of the Tacoma pickup.
GM announced today its ownership in NUMMI will go along with the company's discarded liabilities in the "old" GM it seeks to form as part of its Chapter 11 restructuring.
DETROIT -- General Motors North America President Troy Clarke said the automaker has yet to find a model that is suitable to build at the GM-Toyota joint venture plant in California, New United Motor Manufacturing Inc.
GM will stop making the Pontiac Vibe at NUMMI in August as it winds down the entire Pontiac brand. The Vibe is based on the Toyota Corolla and Toyota Matrix.
"We've just not found a product that suitable for NUMMI," Clarke told reporters Friday in a conference call on GM's small car plans. "They've been great partners...and the dialogue continues."
SANTA MONICA, Calif. - June vehicle sales will hit their highest level of 2009 with a
Seasonally Adjusted Annualized Rate of 10.1 million when manufacturers report them Wednesday, Edmunds.com
forecasts.
"The SAAR is finally back in double-digits," observed Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "We're still a long way from 16 million unit sales, but things are moving in the right direction.
General Motors and Chrysler, which both were in Chapter 11 bankruptcy during the month, are expected to post market share gains in June compared with May, proving yet-again -- contrary to conventional wisdom -- that consumers will, indeed, buy cars from a bankrupt manufacturer, at least in these current tumultuous times.
Honda and Hyundai also are forecasted to show May-to-June market share gains. The gains come at the expense of share declines for Ford, Nissan and Toyota. Despite Ford's dip, the share for Detroit automakers is estimated to come in at 47.0 percent in June, up from 46.6 percent in June 2008 and from 46.5 percent in May.
DETROIT -- The financial turbulence of the global auto industry has not hurt vehicle quality. Quite the opposite, according to new data released Monday by J.D. Power and Associates.
"Vehicle quality is better than it has ever been," Dave Sargent, J.D. Power's vice president of automotive research, told the Automotive Press Association here as he announced the results of the 2009 Initial Quality Study. The study measures defects reported by buyers in the first 90 days of ownership.
"There's a positive disconnect. There's no correlation between the financial side of the business and the production side," said Sargent. "Despite the turbulence on the business side and concern for the future of their own jobs, the people who design and build vehicles are getting on with their jobs and keeping their eye on the ball. That's remarkable."
DETROIT -- General Motors declared the end of the Pontiac Vibe in August.
GM, as part of its Chapter 11 bankruptcy restructuring, will eliminate the Pontiac division entirely by the end of the year.
However, GM will end the production of the Vibe, which is built at a GM-Toyota joint venture plant known as New United Motor Manufacturing Inc. (NUMMI) in Fremont, California. The Vibe shares its underpinnings with the Toyota Corolla and Toyota Matrix.
GM says it is in "active discussions regarding potential future production at NUMMI." Toyota reportedly has been considering building the Prius hybrid there.
When gasoline prices plunged early this year, sales of hybrid-electric vehicles went South, too.
Quickly.
The timing may be unfortunate, but major hybrid players Toyota Motor Corp. and Honda Motor Co. Ltd. launched new hybrids this spring -- and both seem determined to grub out a larger portion of the yo-yoing hybrid market. That battle, the latest summertime jump for gasoline prices and the U.S. auto market's continuing gyrations are once again cranking up the attention on hybrids.
Baton Rouge, La. -- A company described as a well-financed start-up reportedly is close to
choosing a shuttered north Louisiana site to start a new automobile manufacturing facility -- its first, creating up to 1,500 jobs, two elected officials from the region told the Associated Press.
A formal announcement on the mystery company could come Wednesday from Gov. Bobby Jindal, Rep. Jim Fannin told the wire service.
Fannin said the vehicles would be the company's first, they would be fuel-efficient ones and they will be built at a former Guide Corp. plant.
In a throwback to a simpler era, the new Ford F-150's drop-down tailgate step has become an entertaining flashpoint in the marketing war between heavyweights in the pickup-truck segment.
In a current TV ad for the Silverado, Chevrolet's celebrity pitchster, Howie Long, tweaks the addition of the "man step" to the F-150 as an embarrassment -- because it only helps make up for the unreasonably long reach required to get over the tailgate to the bed of the F-150.
But Ford executives assert that Chevy's gambit actually highlights an appealing innovation for potential truck buyers -- and makes them more likely to choose an F-150.
"Our steps have done very well, because they're selling at about 30 percent of the mix of our F-150s," said Doug Scott, Ford's truck marketing manager. "So I hope GM keeps running the ad [in which] they're panning it."
By Bill Visnic and Michelle Krebs
DETROIT -- Admitting the industry and economic downturn has taken a hard toll on luxury-car sales and possibly altered, at least for awhile, customers' thinking about their "wants" versus their needs, the sales boss for Toyota Motor Sales USA's Lexus luxury division says the worst may have passed.
Mark Templin, Lexus group vice president and general manager, says luxury has been beaten down -- maybe even disproportionately in relation to the battered overall auto market -- but he believes customers will come back to luxury cars, despite enduring a once-in-a-generation recession.
DETROIT - It's far too premature to break out the champagne and even too early to finally call the absolute bottom of one of the worst auto sales slumps in decades. But May sales reports from auto manufacturers in the U.S. hinted the worst just may be over.
"We saw glimmers of hope in May sales reports," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com, parent of AutoObserver.com.
General Motors may stop building cars at a factory it owns with Toyota in California, known as NUMMI, following
the Detroit-based carmaker's bankruptcy filing Monday, Bloomberg News
reports.
The only GM product the plant builds is the Toyota Corolla/Matrix-based Pontiac Vibe, which will be eliminated as the automaker closes down the Pontiac brand.
The plant also builds the Toyota Corolla and Toyota Tacoma.
SANTA MONICA, Calif. -- May car sales, due to be reported by auto manufacturer Tuesday, remain off by double-digits from last year, but the sales increase from April to May is in line with typical April-May seasonal bumps and the drop from a year ago is largely due to lower fleet sales, according to Edmunds.com's forecast.
For May, manufacturers are expected to report new vehicle sales -- retail and fleet -- of 890,000 units, a 36.1 percent decrease from the 1.4 million sold in May 2008 but an 8.9 percent increase from the 817,000 sold in April. A typical seasonal increase between April and May is a 9 percent rise. When adjusted for this difference in the number of selling days in May versus a year ago, sales decreased 33.6 percent.
That would put the Seasonally Adjusted Annualized Rate at about 9.5 million vehicles, up from 9.3 million in April.
Toyota, still the world's largest automaker and once the world's most profitable one, posted a quarterly loss heftier than what analysts had forecasted and even bigger than the one beleaguered General Motors reported Thursday. The fourth-quarter red ink pulled Toyota's full-year results into negative territory.
For the fourth quarter ended March 31, Toyota lost the equivalent of about $7 billion, one of the biggest quarterly losses recorded by a Japanese manufacturer and more than the $6 billion GM lost in the same quarter.
The fourth quarter pushed Toyota's full-year results to a loss of about $8.6 billion, its first loss in about six decades.
And Toyota, scrambling to cut costs and boost revenue, revealed Friday it expects an even larger loss in the current fiscal year because of another 1 million drop in sales for the year. Toyota's anticipated loss is bigger than analysts predicted.
April's auto sales numbers looked pretty much like those from March, and February, and January - abysmal. Industrywide sales plunged by 34 percent last month compared with a year earlier, continuing the first-quarter trend of dreadful comparisons tied to a moribund economy.
But in those April results, carmaker executives and analysts on Friday also thought they saw more than just the latest in a long string of awful comparisons with 2008. Almost to a person, they interpreted April's performance and other economic data as painting at least a near bottom of the dreadful U.S. car market - and as the harbinger of an eventual recovery.
"We won't truly be able to call the bottom until summer when we can look back at three consecutive months of increase in the annualized rate of sales," said Jesse Toprak, executive director of industry analysis for Edmunds.com. "We had expected April would be the start of that. And April's annualized sales rate, while lower than March, still didn't dip to February level."
TORRANCE, California -- Toyota announced pricing on its 2010 Toyota Prius that puts it
higher than the 2010 Honda Insight.
The 2010 Toyota Prius will start at $22,750, including a $750 destination charge, when it goes on sale in late May, putting it higher than the 2010 Honda Insight, which starts at $20,470 and went on sale March 24.
However, Toyota's pricing strategy includes the rollout later this year of the 2010 Toyota Prius I, a stripped-down base model that will start at $21,750 -- still more expensive than the cheapest Insight.
SANTA MONICA, Calif. -- The 2010 Toyota Prius beat the 2010 Honda Insight in a
comparison test conducted by Inside Line
, Edmunds.com's
online enthusiast car magazine.
"The 2010 Toyota Prius is quicker, it stops shorter and, with its smoother ride quality and quieter cabin, it's the one you want to be in when commuting," says Erin Riches, Edmunds' Inside Line senior editor.
In the comparison test, the 2010 Honda Insight was praised for its steering and for the responsiveness of its continuously variable transmission (CVT).
Toyota may report an operating loss for a second-straight year, the Japanese newspaper
Nikkei reported.
Toyota already is expected to post a $5-billion loss of $5 billion for its fiscal year that just ended on March 31. Now Nikkei reports Toyota could report an operating loss even larger than that for its current fiscal year, which ends March 31, 2010.
Toyota will sell about 6.5 million vehicles this year, the first time in six years its sales have fallen below 7 million.
BMW and Toyota were the only two auto companies to make the list of 99 of the world's most ethical companies in the Ethisphere Institute's third annual rankings announced Monday.
"The mission of our group is to improve corporate behavior," said Alex Brigham, executive director of the international think-tank based in New York dedicated to the advancement of best practices in business ethics, corporate social responsibility, anti-corruption and sustainability.
In global news, the auto industry criticized Prime Minister Gordon Brown's subsidy for electric cars, Nissan and Renault announced plans to supply China with electric cars by 2011; U.S.-based Tesla is expanding to Europe; and vehicle sales in Australia tumbled in the first quarter.
A black-owned construction company has filed a federal civil lawsuit against Toyota,
Mississippi Gov. Haley Barbour and the Mississippi Development Authority claiming racial discrimination in the construction of Toyota's new plant in northeast Mississippi.
The owners of Fish & Fisher, Jacqueline Williams and Renna Fisher, say Barbour, MDA and the car company acted in concert to bar them from participating in what they claim was a whites-only bid process for site preparation.
ORLANDO, Florida -- Acknowledging that low gasoline prices have hampered hybrid sales growth and that rival Honda Motor Co. could be a threat to its dominance in the hybrid-electric vehicle market, a Toyota Motor Sales U.S.A. Inc. executive says the company remains confident hybrids are a strong growth opportunity.
At a media preview of the heavily redesigned 2010 Prius hybrid here, Ed La Rocque, Toyota's national car marketing manager, confirms Toyota has a plan to address Honda's new Insight hybrid, the recent U.S. launch of which has whipped analysts and industry watchers into a frenzy because the Insight's base price ($19,800) undercuts the current Prius by thousands.
Toyota Motor Corp. is considering a reorganization of its U.S. operations, pulling
sales, marketing and manufacturing under one powerful executive in an effort to stem its current losses, reports say.
The possible reorganization, reported by the Detroit News Wednesday and confirmed by AutoObserver sources, comes as Akio Toyoda, grandson of the company founder, is about to take over as president and CEO in Japan.
A late-month uptick caused March car and truck sales to surpass forecasters' expectations, providing a glimmer of hope to the U.S. auto industry that the long and ugly drought is nearing an end.
"We started to see some signs of life in the March numbers," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com, parent of AutoObserver.com. His remark echoed similar comments made by auto company executives and analysts as they delivered their March sales results Wednesday.
Particularly encouraging to everyone was the rise in the annualized rate and the above-average hike in sales from February to March.
SANTA MONICA, Calif. -- Automaker incentives set a new all-time high in March, even though it appears they didn't help sales much, according to Edmunds.com
.
The average automotive manufacturer incentive was $3,169 per vehicle sold in March, the highest industry average on record.
"Automakers are pulling every lever in their effort to attract buyers, as evidenced by the new programs from Ford and General Motors," stated Jesse Toprak, Edmunds' executive director of Industry Analysis. "The typical incentive programs simply do not resonate in today's economy."
SANTA MONICA, Calif. -- March car sales to be reported April 1 by manufacturers look a lot like February car sales, and that's not a good thing since March traditionally marks the kick off of the busy spring selling season.
"If sales continue at this pace all year, we're looking at a Seasonally Adjusted Annual Rate of only 8.9 million vehicles sold, which is slightly more than half of 2007 sales," said Edmunds.com CEO Jeremy Anwyl.
When he was Toyota's top American executive, Jim Press often cited his visits to the hospital nursery to support his prediction that U.S. motor vehicle sales would hit 20 million units a year.
"What I see in each of those baskets is 20 purchase cycles," Press, now president of Chrysler, would say of the rows of babies -- future car buyers -- in cribs.
Press no longer predicts 20 million vehicle sales; instead he sees 14 million at best for the near future. Nevertheless the hospital nurseries are jampacked with a record number of new babies.
WESTLAKE VILLAGE, Calif. - Buick and Jaguar ranked highest in vehicle dependability, in a tie for first place in the J.D. Power and Associates 2009 Vehicle Dependability Study released Thursday morning.
Buick climbed to the top this year from sixth place in the 2008 rankings; Jaguar moved up from 10th place. Both surpassed Toyota and its luxury division Lexus, though Toyota and Lexus immediately followed in the No. 3 and 4 spots while also nabbing the most individual categories for vehicle dependability.
"Buick has ranked among the top 10 nameplates each year since the study was last redesigned in 2003, while Jaguar has moved rapidly up the rankings," David Sargent, vice president of automotive research at J.D. Power and Associates, said in a statement.
"Lexus remains a very strong competitor in long-term quality. In particular, the Lexus LS 430 sets the industry standard for dependability, with fewer problems reported than any other model in the study," Sargent added.
In news from around the world Wednesday, Toyota has partnered with French utility company EDF to road test the plug-in Prius, a Chinese vehicle brand is set to launch in Israel, and Merrill Lynch forecasts dramatic retraction of Canada's economy in the first quarter of 2009.
In global news Tuesday, Mazda said it was seeking financial help from the Japanese government, China is giving incentives to rural dwellers to buy cars, and Kia slashed its forecast for Russia.
Toyota, Nissan and Honda rejected their unions' requests for higher wages and heftier bonuses for workers.
In Japan, salaries and bonuses are usually negotiated in the winter, in advance of the start of the new fiscal year on April 1. Typically, the companies grant whatever is requested for base pay and bonuses, but this year is different.
In news from around the globe Monday, Toyota announced 50 percent bonus cuts for Japanese management, Ford is reducing output at several European plants, consumer gas prices in Shanghai rose to the government-limited maximum, and Chinese automaker Geely has halted production in Russia.
DETROIT -- You could imagine a collective sigh of relief as General Motors and Chrysler executives closed their doors late Monday behind the most important guests they've ever had visit.
And you could imagine them wondering what kind of impression they had made on the representatives of President Obama's automotive task force that will decide their fate. "So what did they think?" they must have been asking.
Yet those task force members, none of whom have automotive experience, remain as poker faced as any card player, not providing even the slightest hint about their impressions of their Detroit visit, their thoughts on the precarious situations of GM and Chrysler and their plans for what they will do when the March 31 deadline arrives.
DETROIT -- Representatives of President Barack Obama's automotive task force are visiting
Detroit Monday. Their trip includes a tour of a Chrysler assembly plant and General Motor's Technical Center and a test-drive of the Chevrolet Volt.
All the while, auto company executives will try to convince them further federal assistance is a worthwhile investment for taxpayers.
Their visit comes as Republicans cranked up the volume on their opposition to support Detroit automakers and yet another survey showed the American public generally is opposed as well.
Nissan just announced that it plans to stay away from the North American International Auto Show in Detroit next year, as the company did this year. It also plans to skip other major U.S. shows and dozens of smaller ones scattered across the country, as well as the Frankfurt exhibition this September.
But as auto company executives, suppliers and the global news media gathered in Geneva last week for one of the most prestigious regular shows, Nissan appears to be alone in its strategy of making draconian cuts in its annual exhibition budget to help get costs under control in this severe sales environment.
In fact, most other automakers -- even badly damaged Chrysler -- so far are making it a point to stick with their expensive investments in auto-show participation.
You know the economic environment is tough all over when formidable Toyota goes hat-in-
hand to the Japanese government for a handout.
In fact, public broadcasting station NHK in Japan, reported that Toyota, which expected to report its first loss in history for the fiscal year that ends March 31, has asked the Japanese governments to loan about $2 billion to Toyota Financial Services because private investors are demanding up to 50 percent or more in interest for the company's debt.
DETROIT - Americans, unemployed or fearing they will be, hunkered down last month, cutting their household budgets, squirreling away money and avoiding dealer showrooms as February car sales sunk to their lowest level of any February in more than four decades.
Automakers sold 691,073 vehicles in February, down 40.9 percent from the 1,168,729 they sold in February a year ago. That marked the lowest level of car sales for any February since 1967, according to General Motors' record books. That fact is even more eye-popping when population is considered: in 1967, the U.S. had 103 million registered drivers; today the nation has nearly twice that many.
And it put the closely-monitored Seasonally Adjusted Annualized Rate (SAAR) at 9.1 million vehicles, the lowest SAAR since 1982.
Not coincidentally, consumer confidence, a key indicator for how vehicle sales will fare, sunk to record lows in February, according to at least two measurements. And much of that has to do with dimming employment picture as well as dwindling household worth.
Gas is down around $2 a gallon again. Honda is about to introduce a $19,000 (give or take) hybrid. The economy's in the tank. People are pinching pennies like crazy. And new-car sales are at their lowest levels in decades.
Sounds like a great time for Toyota to hit the market with its third-generation Prius, a car likely to be priced thousands of dollars above its prime competitor, the new Honda Insight hybrid.
But that's exactly what Toyota's doing. Toyota expects the 2010 Prius, which arrives in showrooms in June, will reverse the model's sliding sales and bring 100,000 buyers into the market in the last seven months of this year.
SANTA MONICA, Calif. -- The still-deteriorating economy and the continued uncertainty about employment kept consumers away from buying new cars again in February despite the record-breaking deals available to them.
February car sales, to be posted by automakers Tuesday, are expected to be down about 40 percent from a year ago to 685,000 vehicles sold for the month, according to Edmunds.com, parent of AutoObserver.com.
That puts the closely watched Seasonally Adjusted Annual Rate (SAAR) for the month at 9.3 million vehicles, down from 9.6 million the previous month.
"The fluctuation in car sales and the instability of the stock market are just two examples of the volatility in the marketplace, which is wreaking havoc on consumer confidence and hampering any economic recovery," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis.
Toyota Motor Corp. has rehired Yoshimi Inaba to revive the automaker's operations in North
America where U.S. vehicle sales have plunged to their lowest level in nearly three decades.
The 62-year-old Inaba left Toyota in 2007 to run Central Japan International Airport Co. in Nagoya. He first joined Toyota in 1968 and later was president of North American sales. A Toyota spokesperson said he will oversee some North American projects.
This week's Chicago auto show isn't expected to be chock-full of prominent concept- or production-car introductions, as automakers hunker down to evaluate how best to absorb still-disintegrating auto sales.
More important, Chicago comes after a definitely somber Detroit auto show - and just before General Motors Corp. and Chrysler LLC are scheduled to present the next phase of their restructuring "blueprints" to federal officials on Feb. 17. From there, the two automakers must present the full case by March 31 that they are "viable" and worthy of more government investment - a cash infusion both say they need to avoid bankruptcy.
So the Chicago show will make the most of introductions that are, for the most part, likely to reflect these less-ebullient industry times.
Saying the company expects auto sales levels to begin recovering in the second half after "bouncing around the bottom" the first six months of this year, Don Esmond, senior vice president, automotive operations, Toyota Motor Sales USA, says the industry seasonally adjusted selling rate should begin to rise toward more tolerable levels later this year.
After recording January sales, the U.S. industry's SAAR projected to less than 10 million units. And Toyota today reported the global auto sales plunge that began in the second half of 2008 will drag it to its first net operating loss in 59 years, as the company expects to record a loss of some $3.85 billion for the year ending in March.
The loss comes on the expectation Toyota will sell nearly 1.5 million fewer vehicles around the world than it originally projected.
Two huge drags on the U.S. auto market - an utter lack of consumer confidence, and a paucity of credit -- persisted in January and were joined by a new one: at least a temporary evaporation of the fleet market.
Industry-wide sales in January cratered from a year earlier, falling by 36.9 percent, to about 677,000 units from 1.06 million vehicles sold in January 2008. The seasonally adjusted annual sales rate fell to fewer than 10 million units for the first time in more than 26 years. And the American auto business sold fewer cars than for any month since the depths of a recession in December 1981.
DETROIT -- Sales analysts for Toyota Motor Corp.'s Scion brand are still looking at the numbers from the last half of 2008 -- a disastrous six months for U.S. auto sales -- but the brand's vice president says the economy's credit meltdown probably did not hurt Scion as much as it might be assumed for a brand that broadly target's young and first-time buyers.
And despite the rapid and debilitating contraction of the U.S. market, Scion wants another model to sell.
Super Bowl audiences will see a dearth of car ads during Sunday's big game, and they will see none from Detroit's ailing automakers. Only Audi and Hyundai, back for the second year as they seek to increase market share in the game, and Toyota will advertise during the game.
The cost of the ads, which hit the $3-million mark for a 30-second spot (of which there will be nearly 50) this year, is significant barriers to entry for automakers with auto sales slumping to their lowest levels since the early 1980s and most companies struggling to turn a profit. And the payoff is mixed for advertisers, even though the Super Bowl attracts millions of eyeballs.
SANTA MONICA, Calif. -- U.S. car and truck sales in January are expected to come in at a weak 730,000 units when automakers report them Tuesday.
January sales are expected to be down 18.1 percent from very weak sales in December, Edmunds.com estimates, largely due to significantly lower rental-car and corporate fleet sales. Retail sales will be about flat with December's.
"Our research indicates that retail sales are pretty much flat compared with December," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "However, automakers' decision to cut fleet sales and make other production cuts will cause a large sales decline to be recorded on the books."
DETROIT -- In Washington, the talk is of what cars automakers will produce in 2011, 2016 and 2020, but the auto industry faces an immediate demand: sell cars today.
Dealers, particularly, face a challenging dilemma as to just how to do that. The auto manufacturers, notably General Motors and Chrysler, are pressuring them to order more 2009 models so that factories can remain open and the automakers can book revenue.
Yet, dealers are buried with bulging stockpiles of old models, becoming increasingly expensive to keep and eating into their bottom-line. Yet, even hefty incentives aren't attracting buyers.
Despite published reports in Japan to the contrary, Toyota is denying that it will cut worldwide vehicle production by at least 20 percent this year.
The Japanese newspaper Tokyo Shimbun reported Monday that Toyota planned to produce about 6.5 million vehicles this year, down from the 8.21 million it assembled in 2008.
Toyota displaced General Motors as the global leader in vehicles sales in 2008, a spot the Detroit automakers had held for 77 years.
Toyota sold 8.97 million vehicles worldwide in 2008; GM sold 8.35 million, it announced Wednesday morning. Toyota's sales slipped 4 percent in 2008 from 2007; GM's fell 11 percent.
"The story has yet to be written" as to whether Toyota will maintain that No. 1 spot, said GM's analyst Mike DiGiovanni in a Wednesday conference call on global sales with media and analysts.
The Japan Automobile Manufacturers' Association reportedly plans to meet later this month
about whether or not to hold the 2009 Tokyo Motor Show. A decision likely will be announced shortly thereafter.
An official of the organization was quoted as saying the show, held every other year, may be canceled due to the global economic crisis.
The Tokyo show has struggled in recent years to maintain its status as an international show because of Japan's largely closed market. Automakers have opted instead to shift their auto show dollars to China.
DETROIT - Saying at the Detroit auto show here that the U.S. auto market is entering a period of transition that is almost certain to be difficult for both automakers and consumers, a senior Toyota U.S. executive is forecasting a rebound in the second half of 2009.
Acknowledging drastically reduced vehicle sales in the second half of last year reached levels as painful for Toyota as most other automakers, Bob Daly, Senior Vice President, Toyota Motor Sales USA, says a number of factors make Toyota confident a "recovery" is coming in the second half.
Nearly 3 million U.S. auto sales evaporated in 2008, and plenty of that blood was lost by the Detroit Three: General Motors Corp. sales were down 23 percent, Ford Motor Co. sales slid by 20 percent and Chrysler LLC sales dropped by 30 percent.
Total U.S. sales plunged from 16.1 million units in 2007 to 13.2 million for 2008. Equally interesting -- and troubling, for Detroit -- was that not only did the pie get painfully smaller, the domestic automakers' portion, market share, once again lost ground.
According to data from Edmunds.com, the Detroit Three lost a collective total of 3.7 points of market share in 2008. Chrysler led the group, ceding 1.9 points of share (from 12.9 percent of the market in 2007 to 11 percent in 2008). GM lost 1.4 percent (from 23.8 percent in 2007 to 22.4 percent). Ford gave back 0.4 points of share (from 15.5 percent to 15.1 percent for 2008).
Striking every attitude from empathy to ambivalence to something resembling snarkiness, automakers have been using new TV-advertising campaigns to try to jolt consumers off their couches and into dealer showrooms.
The headwinds are daunting, but automakers have been launching a greater variety of messages than at any time in recent memory - attempting to find something, anything that punches effectively through the pervasive gloom in American households and reignites their desire and confidence to make a major purchase.
U.S. auto sales continued their precipitous tumble in December, closing the books on the industry's worst year since 1992.
Five of the Big Six automakers -- General Motors, Ford, Toyota, Nissan and Honda -- saw sales slide another 30 percent each in December; Chrysler's plummeted 53 percent. No automaker showed higher sales December to December. The lucky ones saw mere single-digit dips.
For the full year of 2008, all of the Big Six automakers reported sales declines. In total, the industry sold 13.2 million vehicles for an 18 percent drop from 2007's 16.1 million.
"It was an unbelievable year -- not one I want to repeat," said Mark LaNeve, GM's head of sales and marketing in a conference call with reporters. "Hopefully, 2009 will improve from December's low point rather than deteriorate as 2008 did."
SANTA MONICA, Calif. -- Automaker incentives set a new record in December, Edmunds.com estimates, and, surprisingly, leasing showed a remarkable jump despite reports of its demise.
"Never before has the December average incentive been this high," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "Automakers have been pulling out all the stops to keep motivating shoppers during these tough times."
Slowing sales have struck virtually every automaker and every market segment. U.S. auto industry sales for December and the full-year of 2008 are being reported Monday. December sales are expected to look a lot like the dismal levels of October and November -- and down from in the neighborhood of 30 percent or more from December 2007. Full-year sales are likely to be the worst since 1992.
Japan's financial sector is buzzing with the prospect Toyota Motor Corp., one of the nation's most successful and powerful corporate entities, is likely to record it's first-ever full-year operating loss, reports Japan's Nikkei English-language business newspaper.
Toyota has not recorded an annual operating loss since it began publicly reporting its earnings in 1940, and the Nikkei says fallout from World War II led to Toyota's only pre-tax loss -- in 1949.
SANTA MONICA, Calif. -- The deteriorating economy, the precarious employment situation and the lack of available credit will push the annual sales rate in December for U.S. car sales to their lowest level of the year below 10 million units, Edmunds.com forecasts.
December sales (retail and fleet) are expected to total 852,000 units, a 38.4 percent decrease from December 2007 but a 14.6 percent increase from November, Edmunds.com predicts. Typically, December sales are about 18 percent higher than November's.
With the year closing on a low note, U.S. vehicle sales for all of 2008 will total just over 13 million, a decrease of almost 3 million vehicles, or 18 percent, from 2007. Automakers report December and 2008 sales figures January 5, 2009.
Toyota Motor Corp. said Monday it is delaying plans to open its newest U.S. plant in
Mississippi, which was to have built the next-generation Prius hybrid.
Citing the steep decline in the auto market, Toyota said it would complete construction of the building but would hold off on installing equipment, delaying the start of production that was slated for 2010.
The delay of the Mississippi plant is part of a massive cost cutting the Japanese automaker has undertaken. Next week, Toyota is expected to slash its 2009 sales forecast by at least 1 million vehicles and outline plans to cut costs at its year-end news conference December 22, Reuters news service reports.
With a pending vote Congressional vote on a bailout package to extend so-called "bridge loans" to Chrysler LLC, Ford Motor Co. and General Motors Corp. by perhaps as soon as this week, New York Times
columnist Thomas L. Friedman -- often prominent for his provocative views on the auto industry -- is calling for one unique "string" to be attached to federal bailout funds: forcing the domestic automakers to present plans to hybridize their entire model ranges in three years.
Friedman has been a vocal advocate for hybrid-electric technology and has been criticized for a view of the industry that typically is unkind to the Detroit auto-industry establishment. Friedman often argues in favor of the management style and operational practices of Detroit's chief competitors, the Japan-based automakers -- and caused fireworks when he once suggested GM should go out of business and let Toyota assume GM's longstanding role.
The debate over aid to the Detroit-based automakers is awash with half-truths and misrepresentations that are endlessly repeated by everyone from members of Congress to journalists. Here are seven myths about the companies and their vehicles, and the reality in each case.
This column by Detroit Free Press auto critic Mark Phelan originally was published on November 17 and was updated last Friday to debunk the myths as Congress was about to fashion an automotive rescue package.
In case members of Congress needed any more reminding why the domestic automakers are hat-in-hand before them this week, the 37 percent drop in November sales has provided them with the latest bleak snapshot of a moribund U.S. vehicle market.
As the Detroit Three were presenting their restructuring plans in Washington, D.C., on Tuesday, the sales data rolling in from them and all other OEMs gave further dimension to the vast pall that has come over the nation's automotive market and quantified the paralyzing dread that is felt by American consumers.
With reports still rolling in, U.S. vehicle sales for November look as if they will be down about 35 percent from a year ago. The annual sales rate appears to be a weak 10.6 million vehicles.
General Motors' sales fell a hefty 41 percent. Ford said its U.S. sales fell 31 percent. Toyota reported sales down 34 percent; Honda a 32 percent decline. Chrysler saw sales plummet 47 percent. Nissan sales took nosedive at 44 percent.
SANTA MONICA, Calif. -- Domestic automakers eased off the incentive gas in November while import automakers revved up incentives, according to Edmunds.com.
"All three domestic automakers lowered their incentive spending this month, seeking to preserve cash during these incredibly tough times," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis. "Meanwhile, the imports have poured more money into incentives, attempting to seize the opportunity to gain market share. Toyota's monthly incentives spend hit a new record high in November, and the company's market share might follow suit."
SANTA MONICA, Calif. -- November car sales improved over October's historic lows thanks to lower gas prices and high incentives.
November new vehicle sales, including fleet and retail sales, are expected to be 850,000 units, a 27.6 percent decrease from November 2007 but showing a 1.9- percent increase from last month, according to Edmunds.com's forecast.
Still, the Seasonally Adjusted Annual Rate (SAAR) for the month is expected to be only about 11.5 million units.
Nissan is among Japan's leaders in capital spending spending cutbacks, the Japanese newspaper Nikkei reported Monday. Nissan said its capital spending will total $4.4 billion in the year ending March 31, 2009. That's 50 billion yen, or 11 percent, less than the forecast Nisan announced on May 13.
Toyota did not revise its 1.4 trillion yen capital-spending plan when it released earnings on Nov. 6.
Toyota, the automaker with the best credit in the industry, may see its AAA rating cut by Fitch Ratings due to the "unprecedented challenges" in the economy. It would be the first downgrade for Toyota in a decade.
Richard Shelby, the top Republican on the Senate Banking Committee, took to the airwaves over the weekend as the chief opponent of loans to Detroit automakers. His premise: This is a Detroit problem not a national problem and taxpayers shouldn't subsidize these poorly managed dinosaurs.
"I don't believe they've got good management. They don't innovate. They're a dinosaur, in a sense, and I hate to see [them get government loans]," Shelby said on NBC's Meet the Press.
With all due respect Senator Shelby, this is not only a Detroit problem. It's an Alabama problem. It's a national problem. And it's a global problem. Recession is spreading around the globe like a California wildfire. Once-hot auto markets have caught cold. And automakers everywhere -- not just in the U.S. -- are asking their governments for a helping hand.
You know things are bad when seemingly invincible Toyota is struggling, and it is.
Calling the current economic environment "unprecedented," Toyota reported Thursday its quarterly profit plunged 69 percent, mainly due to slumping vehicle sales in the U.S. and Europe, where Toyota lost money, as well as depreciation of the yen versus the U.S. dollar.
Toyota's earnings drop was far more dramatic than analysts had anticipated and prompted Toyota executives to severely downgrade its profit forecast for the year. Earlier, Honda and Nissan announced larger-than-expected profit declines. Toyota President Katsauaki Watanabe Thursday predicted the automaker, when it posts its financial report when its fiscal year ends March 31, 2009, will report its smallest annual profit since 1999.
As many as 3 million jobs and hundreds of billions of dollars will be lost from the U.S. economy if General Motors, Ford and Chrysler cease operations, a new report shows.
The report by the Center for Automotive Research (CAR) details the job losses and economic impact of two scenarios: if all three Detroit automakers cease operations next year; and if Detroit automakers contract by half, likely involving two automakers going out of business.
"Either of these scenarios is possible, and indeed probable, within the next 12 months," the study says.
In both scenarios, the impact is devastating for jobs, income, the nation's tax base and consumer spending that could pull the U.S. economy out of recession.
Other automakers doing business in the U.S., including Toyota and Honda, also would be hit as would Canada and Mexico.
There were almost no words on Monday to describe how abysmal U.S. auto sales were in the woe-begotten month of October.
Bled by battered consumer confidence, by more expensive and harder-to-obtain loans, by financial-market disasters and Election Day anxieties, October sales limped in at only about 852,000 vehicles nationwide, a 32 percent plunge from a year ago.
"This level of sales is not sustainable for anyone in the industry," said Michael DiGiovanni, head of global market analysis for General Motors. "It doesn't matter how deep their pockets are. Everyone is pulling in their reins to one degree or another, but everyone is affected by this."
GM's sales slumped by a horrific 45 percent, the worst showing among the Big Six automakers selling in the United States. Chrysler's declined by 35 percent, Nissan's by 33 percent, Ford's by 29 percent, Honda's by 25 percent and Toyota's by 23 percent.
The industry total comprised its lowest sales volume for any month since 1992. And adjusting for population growth -- that is, on a per capita basis -- October auto sales were the industry's worst since World War II.
The belt-tightening in the global auto industry is beginning to make itself shown in new-product plans in practically every region. Replacement models are being delayed, proposed new models are being canceled or reconsidered, and new-product investment, in general, begins to suffer the results of sagging sales and ever-tightening access to credit.
It seems to be getting more difficult for General Motors Corp., for one, to disguise the fact minimum comfortable levels of operating income have been reached. The company is enacting its first white-collar layoffs in decades and is seems increasingly desperate to find a ready cash stream.
DETROIT - Consumer Reports magazine delivered more bad news to Chrysler Thursday, noting the automaker's vehicle reliability has dropped since Cerberus Capital Management took over the company just over a year ago.
In contrast, Ford's reliability is now approaching that of Toyota and Honda with almost all of its vehicles achieving above-average reliability in the magazine's annual survey. General Motors' results were mixed.
"There has been a systematic, structural change within Ford,'' said David Champion, director of the magazine's auto test center, said. Champion revealed the magazine's survey results Thursday at the Automotive Press Association meeting in Detroit.
SANTA MONICA, Calif. - October auto sales are turning out to be every bit as bad as
forecasters predicted early in the month.
Edmunds.com forecasts October new vehicle sales, including fleet and retail, will again fall below the 1-million mark to 872,000 vehicles sold - about 30 percent below October 2007. October 2008 will mark the U.S. auto industry's lowest sales level since January 1992.
And the industry should brace itself for a terrible November, typically one of the lowest sales months of the year.
PARIS -- There's a lot of talk these days about how auto styling is converging -- or being ripped off.
At the 2008 Paris Auto Show earlier this month, there wasn't much mistaking the distinctive shapes presented by France's home-market biggies, Citroen and Peugeot; French styling remains unique (and largely uncopied, perhaps for a reason).
But a number of vehicles on display at the show looked strikingly similar to other vehicles on the show floor -- or ones we've seen elsewhere.
SANTA MONICA, Calif. -- October automotive sales continue to be in freefall from September with zero percent financing offered by auto manufacturers providing little, if any, incentive for people to buy cars, according to the latest data from Edmunds.com, parent of AutoObserver.com.
"The automotive market slowdown has entered a new phase," said Edmunds.com Chief Executive Officer Jeremy Anwyl. "Barraged by bad economic news, consumers, instead of hoping for the best, now are preparing for the worst, and that includes postponing even the thought of buying a car."
For automakers, the old tricks don't work. Even attractive promotions like the numerous zero percent financing programs, including the unprecedented Toyota deal of 11 models for zero percent, are ignored by consumers, who are not in car-buying mode.
Toyota is offering incentives on 11 models during October after its sales plunged in September, its worst decline since the 1980s. Toyota will offer free financing across its line for between 36 and 60 months depending on the vehicle. Included are the volume-leading Corolla and Camry.
Japan's auto sales for the last six-month period dropped to their lowest level in 34 years due
to rising unemployment, decade-high inflation caused by soaring gas and food prices and an aging population.
Japan's sales of cars, truck and buses (but not minicars) in the six months through September 30 fell 2.9 percent to 1.54 million vehicles, the lowest since 1974, the Japan Automobile Dealers Association said in a statement Wednesday quoted byBloomberg News. In September alone, sales of those vehicles dropped 5.3 percent from a year earlier.
SANTA MONICA, Calif. -- The average automotive manufacturer incentive in the U.S. was $2,801 per vehicle sold in September 2008, down $1, or 0.04 percent, from August 2008, and up $444, or 18.8 percent, from September 2007, Edmunds.com estimates.
"Although up overall from last year, incentive levels remained flat from August to September despite worsening economic conditions and weak auto sales," said Jesse Toprak, Edmunds' executive director of Industry Analysis. "The high incentive costs of heavily discounted 2008 models are being offset by the low incentive costs of the 2009 models entering the marketplace."
Wheezing U.S. auto sales in September fell by 26 percent, coming in below one million units for the first time for any month in more than 15 years and prompting epochal comparisons to the dismal fall of 2001, when American consumers were frozen by the shock of the 9/11 terrorist attacks.
Overall sales for the month were only about 965,671 vehicles, compared with some 1.3 million vehicles sold in September 2007. In September, the seasonally adjusted selling rate -- the industry's most important interpreter of the sales picture -- fell to an abysmal 12.8 million units compared with a rate of 16.5 million last year.
No one is happy about the U.S. House of Representatives' rejection of the $700-billion federal bailout of the financial services sector and subsequent stock market crash - least of all automakers.
In the short term, auto stock prices for almost every global automaker and their suppliers tumbled on the news Monday - some plummeted to record lows. No bailout means no end to the credit crunch that is keeping belt-tightening customers from even bothering to go to a showroom as September sales to be reported Wednesday will show.
Longer term - and maybe not all that long term - even more belt-cinching by automakers will likely result in deepening production cuts and job losses.
The U.S. Senate on Tuesday passed an expansive tax bill that had many automakers on full alert because it included provision of a tax credit for hybrid or fully electric vehicles with batteries that can be recharged from the electric grid - so-called "plug-in" vehicles.
If passed by the House, which is expected, the bill provides for as much as a $7,500 tax credit for purchasers of a plug-in vehicle. The credit, starting at $2,500, would increase in proportion to the vehicle's installed battery capacity up to the $7,500 maximum.
The bloody purge of the U.S. financial industry and its millions of shaky real-estate loans already have forced most automakers to cut way back on lease deals for their customers, an unavoidable blow given the importance of credit to the new-vehicle market.
But auto-company executives aren't giving up on the practice for the long term, believing that today's shakeout will help set the stage for a healthier leasing market in the future. Some of them actually are moving preemptively to ramp up leasing even in the short term instead of cut back.
Meantime, enormous pain is being inflicted on the many automakers that have grown dependent on leasing, the other part of a whopping double whammy that also includes the overall sales slide in the U.S. market.
Sales of automotive luxury brands are struggling just like the overall U.S. market is.
Collectively, so far this year, upscale marques have only managed to hold on to their 11 percent share of the market from 2007. And some of the loftiest brands in the American auto business have been demonstrating some of the least resiliency.
Lexus, for example, is off 15 percent in 2008 sales through the end of August, and BMW brand has suffered a decline of 7 percent. Among domestic luxury makes, Cadillac has plunged 13 percent for the year, while Lincoln has eased by 19 percent.
Automakers are moving forcefully into the online-marketing arena using a number of innovations in which their industry, arguably, has become the leader.
In Wednesday's part two of this three-part series on Internet marketing, Edmunds.com's AutoObserver
featured six ways that automakers are succeeding online. Here are the remaining six:
U.S. auto sales fell by about 15 percent in August compared with a year ago, to approximately 1.25 million units from around 1.5 million units -remaining in their summer-long trough. And a chorus of OEM executives agreed on Wednesday that their forecast for the rest of 2008 looks just about as dismal.
But something else also appeared amid Wednesday's sales reports: reasons to hope that the U.S. market already has flattened out.
"It appears we may have hit the bottom in terms of consumer demand in July," said Jesse Toprak, executive director of industry analysis for Edmunds.com. "Because of factors like lower gas prices and generous incentive spending, we started seeing some improvement in August."
The U.S. automotive market has yet to reverse 2008's serious downward lurch, and automakers continue to pile on incentives to induce customers to purchase a new vehicle. Edmunds.com estimates August incentives were down a scant $3 from the 2008 high point set in July - and increased substantially when compared to the same period last year.
Edmunds.com estimates the average automotive manufacturer incentive in the U.S. was $2,642 per vehicle sold in August 2008, down $3, or 0.1 percent, from July, but up $173, or 7 percent, from August 2007.
Once again, domestic automakers shelled out the most. Combined incentives spending for domestic manufacturers averaged $3,832 per vehicle sold in August 2008, up from $3,762 in July 2008. In aggregate, the domestics spent $387 more per vehicle in August compared with July, which had set the year's record.
Over the last year or so, automakers have moved closer to the forefront of big-brand marketing online as they dramatically increase their expenditures on Internet advertising.
In doing so, OEMs are drawing on a dozen methods. Here are six of them. Look for the other six on Thursday in part three of this series on Edmunds.com's AutoObserver
:
SANTA MONICA, Calif. - Despite a slight improvement in sales from July to August, no significant upturn is on the horizon for this year, according to Edmunds.com's latest forecast.
New vehicle sales for August, to be reported by manufacturers on Wednesday, are expected to total 1.26 million units, a 14.4-percent decrease from August 2007 but an 11.4-percent increase from July 2008. "We saw a slight improvement in July, but don't expect to see a major recovery for the remainder of the year," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis.
Full-size pickup trucks from Japan's largest
manufacturers - Toyota and Nissan -set new records in July for incentives as well as the time it takes to sell them, according to analysis by Edmunds.com
.
Nissan paid its highest amount ever for incentives in July. The Total Cost of Incentives (TCI) on the Nissan Titan hit a record $5,286 for every one sold. Toyota also set a new record for incentives on the Tundra, surpassing the $5,000 mark for the first time, at $5,213 TCI.
TRAVERSE CITY, Michigan - Admitting that even famously "flexible" Toyota Motor Corp. was caught by surprise by the speed and intensity of rising fuel prices in the U.S., one of the company's top manufacturing executives says the company nonetheless reacted quickly to rapidly altered consumer demand and is rapidly making adjustments in its massive manufacturing structure.
Steve St. Angelo, president of Toyota Motor Manufacturing Kentucky Inc. and senior vice president-Toyota Motor Engineering & Manufacturing North America Inc., also told AutoObserver the company's major strategic moves to address shifting consumer desires in the U.S. - pulling the trigger on U.S. production of the Prius hybrid-electric vehicle for 2010 and drastically ramping down production of the Tundra full-size pickup, which started this month - demonstrate Toyota's confidence in its renowned manufacturing flexibility.
And the willingness of the company's Japan-based senior management to react appropriately to rapidly changing market conditions.
As expected, Toyota Motor Corp. reported a sharp reduction in profit for its first quarter, absorbing a 28.1-percent plunge in net income, the company reported today.
Toyota said appreciation of the yen vs. the U.S. dollar accounted for most of the decrease of ¥262.9 billion in operating income, but added that price increases for raw materials also contributed.
The losses come despite the fact Toyota sold 2.19 million vehicles in first-quarter 2008, a slight increase of 24,000 vehicles compared with last year.
Toyota's North American sales were down by 33,000 units in the first quarter, but said it nonetheless recorded a record-high 17.4-percent market share. The highest-ever market share figure did not translate to higher profits, however.
"Decrease in sales volume, the shift of product mix to compact cars, increase in sales expenses such as incentives and increase in reserves for bad debts, resulted in declining profits," the company said in a release, adding, "Toyota will take swift actions in accordance with market changes by increasing the supply of models in high demand and launching new models."
In the U.S., the company also said it is bracing for a sharp decline in the residual value of pickups and SUVs being returned by lease customers.
DETROIT -- One would have to dig into the history books back to 1992 to find a worse month for car and truck sales in the U.S. than July.
The Seasonally Adjusted Annual Rate (SAAR) fell under 13 million vehicles -- 12.55 million to be exact -- the lowest rate since the recession of the early 1990's. Of the Big Six automakers, only Nissan reported an increase in sales. Even Honda, which analysts had predicted would see an uptick, reported lower July sales. Detroit's Three slumped to their lowest combined market share -- 43.4 percent -- in history.
SANTA MONICA, Calif. -- With automakers expected to report Friday that car and truck sales plunged to near-historic lows in July, it's no surprise that manufacturer incentives have reached all-time highs for the year.
Edmunds.com's estimates put July at the industry's highest level of incentive spending for the year so far and the highest level this year for not only for the domestic automakers but also the Japanese and European manufacturers.
The new world order of global auto giants is being shuffled. If first-half sales trends continue through the rest of the year, the new order of automakers, based on vehicle sales, will be: 1) Toyota, 2) General Motors, 3) Volkswagen and 4) Ford.
One doesn't need to be a fortuneteller gazing into a crystal ball to figure out that July vehicle sales, to be reported by automakers on Friday, continue to be in the tank. All one has to do is read recent headlines of downgraded 2008 sales forecasts, more production cuts and boosted incentives.
Edmunds.com released its July forecast Tuesday, predicting monthly sales will drop 10.7 percent from last July, adjusted for the difference in the number of selling days. The decrease is estimated at 3.3 percent on an unadjusted basis. Despite some last-ditch incentive efforts to save the month, all of the Big Six auto manufacturers, with the exception of Honda, are expected to report sales declines from a year ago. Similarly, sales of small compact vehicles continued to boom.
Toyota, as expected, lowered its global vehicle sales target due to the weak U.S. economy, and slow sales in Western Europe and Japan.
Toyota now plans to sell 9.5 million vehicles worldwide in 2008, down from its previous target of 9.85 million. In 2007, Toyota sold 9.37 million vehicles.
Still, Toyota plans to sell more vehicles globally in 2008 than it did in 2007. This could be the year that Toyota ends General Motors' 77-year-reign as the world's global sales king.
Toyota widened its lead over General Motors in global sales during the second quarter, increasing the odds that 2008 will mark the end of GM's 77-year-reign as global sales king.
GM reported Wednesday it had sold 2.28 million vehicles in the second quarter that ended June 30 for a decline of 5 percent from the year-ago quarter. Toyota, meantime, reported its sales rose 1.8 percent in the three-month period to about 2.41 million vehicles.
That put the halftime sales score at Toyota's 4.8 million vehicles to GM's 4.5 million.
Following the lead of its Detroit-based rivals, Toyota Motor Corp. is resigning itself to the fact high-priced gasoline has driven a stake into the heart of pickup-truck sales, announcing yesterday it is suspending production of its Tundra fullsize pickup and essentially removing an entire plant's worth of Tundra production from its future manufacturing mix.
What's replacing Tundra? Manufacturing - for the first time on American soil - of the high-efficiency Prius hybrid-electric vehicle.
A Toyota spokesman says capacity for Prius at the company's under-construction plant in Blue Springs, MS, will be around 120,000, "but that number has not yet been finalized. Toyota is studying the matter further."
Zero-percent financing deals aren't anything new to the industry, but General Motors Corp.'s latest riff on that old tune appears so far to have generated some success, even in these most desperate of times for auto sales.
According to exclusive data from Edmunds.com, sales of select GM vehicles -- mostly trucks -- may have enjoyed a shot in the arm from the zero-percent-for-up-to-72-months spiff, which originally was supposed to run only for the final week of June, but GM not unexpectedly extended through the July 4 holiday weekend.
American car buyers became very discouraged in June. Beaten down by high gas prices and other contributors to growing household financial stress, they bought 8 percent fewer vehicles than a year earlier.
And supply constraints actually depressed sales even further, because those who were in the market wanted more small cars than could be built by the industry as it tries to catch up with consumers' desire to downsize.
June sales for the U.S. auto industry were 1.19 million units compared with 1.46 million vehicles during June 2007. (The 8-percent decline is stated on a daily-sales-rate basis because this June, with three fewer selling days, provided significantly less sales opportunity than a year earlier.) On an unadjusted basis, industry sales came in 18 percent lower than a year ago.
SANTA MONICA, Calif. -- High gas prices, the housing crisis and general economic
uncertainty are motivating consumers to look for the least expensive cars to own and operate. But a new study by Edmunds.com
shows that many compact and subcompact vehicles are actually better choices than hybrids for consumers looking to save money.
The Chevrolet Aveo topped the list of best values based on Edmunds' True Cost to Own data, which accounts for total vehicle costs over a five-year period. No hybrids made the top 10 list.
"When consumers think about cars that will save them money, hybrids are typically top of mind because of their fuel efficiency," said Jesse Toprak, Edmunds.com executive director of Industry Analysis. "But when you take a look at the real-world costs of car ownership, you realize that many subcompact and compact cars are actually a much better value proposition."
TOKYO -- Toyota may not meet its goal of selling more vehicles in the U.S. this year than last because of the weak economy. However, Toyota is sticking with its target of selling more vehicles globally for the year on the strength of emerging markets, the company said at its annual meeting in Tokyo Tuesday.
One bizarre fallout from the wild-ride shift in consumer tastes is a spate of new or soon-to-be-released models that were designed and developed under assumptions about the U.S. market that now are absolutely invalid.
The result: a slew of white elephants designed when gasoline was $2 per gallon (or less) and Americans were still buying 800,000 F-Series pickups and everything else that looked big, sucked gas and telegraphed that you had arrived at that special entitlement heaven espoused by Rush Limbaugh and everyone else who insisted cheap energy and cheap mortgages are an American birthright.
It might be almost laughable if the U.S. domestic auto industry weren't in such disastrous shape -- and had the luxury of time to once again make amends for decades of single-minded product-development choices.
Here's a short list of our favorite vehicles that, thanks mostly to the new rules governing the auto industry, suddenly look titanically dumb:
With fuel prices rising, the dollar falling, the economy flagging and fuel prices zooming, industry sales volumes are drooping. One seemingly counterintuitive answer: raise prices.
Despite an Economics 101 guidance that would dictate the opposite, many automakers are responding to currently lousy market conditions by actually hiking sticker prices and -- taking a cue from many other sectors -- bumping fees, most notably, the ubiquitous "destination and delivery" charge.
TOKYO -- Surging gas prices, global warming and the need to go green make this absolutely the most perfect time for Honda to roll out an all-new, cutting-edge gas-electric hybrid. Honda's eagerly awaited, long overdue rival for the Toyota Prius is set to land in American driveways in the first half of 2009.
Smaller than a Civic and with a unique five-door hatchback style, Honda's "New Dedicated Hybrid Vehicle" may well revive the Insight name when it goes on sale. Strong rumors in Tokyo also suggest that this "new Insight" will adapt and repackage the Civic Hybrid's IMA (Integrated Motor Assist) front-drive powertrain and first appear in public in concept form at this October's Paris Auto Salon, ahead of its full official launch at the Detroit auto show in January.
In a move that was not entirely unexpected, Ford Motor Co. reportedly is studying a plan to implement a hasty and wide-ranging retooling of many of its North American assembly plants, shifting them from production of large pickup trucks and SUVs to smaller, lighter and more fuel-efficient vehicles.
The Detroit News
reports manufacturing executives and local labor leaders will meet in Dearborn on Friday to discuss the plan, which reportedly centers on retooling several plants from production of traditional body-on-frame pickups and SUVs to models and vehicle architectures currently being used in Europe.
It is a strategy many industry analysts have said must be undertaken by all the truck-reliant Detroit automakers. The only surprise, perhaps, is the haste with which Ford is reacting -- a lightning stroke relative to past Detroit responses to major macroeconomic and consumer-preference shifts.
General Motors CEO Rick Wagoner defended Detroit automakers' dependence on sport-utility vehicles and pickup trucks, dismissing criticism that the companies were to blame as demand for those vehicles has collapsed.
"Is it the U.S. manufacturers who are stupid? I don't think so," Wagoner said in an interview with London's Financial Times. The criticism was "not fair," said Wagoner. "It's not just the 'Big Three.'"
Earlier in the week, Wagoner announced at the company's annual shareholder meeting that GM would close truck and SUV production at four North American plants. Those plants make such vehicles as the Chevrolet Silverado and GMC Sierra pickup trucks. Wagoner also announced this week that Hummer was under "strategic review" with all options, including its sale, being considered.
By Dale Buss and Michelle Krebs
Only a few months into the Slump of 2008, at least two things are painfully clear in what has become a topsy-turvy U.S. auto market.
The bigger the carmaker, the harder the ride these days -- even Toyota. General Motors' sales declined the most in May compared with a year ago, by 30 percent; Chrysler's fell by 25 percent; Ford, by 16 percent; and Toyota, by 8 percent. The Detroit Three's domestic market share in May, 45.5 percent, was a record low for any month.
And the larger the vehicle, the faster its sales are teetering into the abyss. Sales of pickup trucks and traditional SUVs plunged across the board in May. So, GM said it is permanently shuttering some truck and SUV plants, adding some car-making capacity, and considering ditching Hummer.
But newly popular small cars are popping up like life preservers on the industry's troubled ocean. Honda's Civic was the top seller for the month, at more than 53,000 units.
Ford Tuesday launched what could be seen as a desperate attempt to jump start sales of its F-Series pickup line by offering "employee pricing" to consumers for the rest of June. This is believed to be the first time since 2005 that any OEM has allowed consumers to pay only as much as its employees pay for a vehicle.
"This is a big deal for us," said Jim Farley, Ford's executive vice president for marketing and communications. "F-Series has spent 31 years running as the leading vehicle in the segment ... We think it's a really important merchandising tool that customers can buy an F-Series for the same price as a Ford employee."
Some analysts predict General Motors may see its share of the U.S. vehicle market slipl below 20 percent on Tuesday when the auto industry reports May vehicle sales.
However, a forecast by Edmunds.com, parent of AutoObserver, predicts GM will stay above the 20-percent mark, coming in at 20.9 percent market share for the month. GM's market share slumped to 20.8 percent in April, according to Edmunds.com's calculations.
On the eve of reporting May sales, Toyota is considering downgrading its 2008 U.S. sales forecast even further to account for deteriorating sales of pickup trucks and other large vehicles.
Toyota President Katsuaki Watanabe to London's Financial Times, in an interview published in Monday's edition, that while the automaker hoped to make up for the lost sales of its full-size Tundra pickup and sport utilities like its Toyota Sequoia by selling more smaller cars such as its Yaris, Corolla and Prius, he was "not sure" this would be enough to offset the drop in large vehicle sales.
"As of now we haven't changed our original annual plan yet, but we may have to scale back," Watanabe told the Financial Times. He said Toyota would revisit its U.S. forecast at a mid-year business review later this month.
At General Motors Corp.'s annual meeting Tuesday, the stickiest questions may not be about the actual dollars and cents of GM's business. Instead, the major issue may be whether - and how - GM can deal with the shocking plunge in demand for full-size pickups and SUVs, the profit machines that have kept the wandering giant afloat for the better part of two decades.
Punishing fuel prices and increasing environmental awareness have all but crushed the "supersize me" mentality of the American auto customer, and now GM and its Detroit-based rivals Ford Motor Co. and Chrysler LLC, with their manufacturing empires witheringly overweighted to address full-size segments, have little to offer the new age of economy-minded consumers.
Equally troubling, the domestics have scant prospect of reversing the situation any time soon - and the heat may be on Detroit executives to begin explaining yet another instance of their collective inability to identify and adjust to emerging auto-market and macroeconomic trends.
Toyota reportedly is talking with General Motors about producing the hybrid Prius at their
joint production plant in California, Japan's Tokyo Shimbun
reported Friday.
Toyota did not confirm the report. A company spokesman told AutoObserver: "We are always considering what should be the optimum structure of our production efforts. But nothing has been decided about building the Prius at NUMMI."
SANTA MONICA, Calif. -- April 2008 was a terrible month for vehicle sales in the U.S., but it looks like May, though worse than the year-ago May, might be a tad brighter than April and especially for some vehicles and some makes, Edmunds.com forecasts.
Toyota looks to be a winner with a projected record market share. Honda likely had a good month as well. The Big Three, however, are predicted to show a near-record low combined market share.
And the trend of buyers selected smaller, more fuel-efficient vehicles instead of larger ones likely accelerated in May, according to Edmunds.com's forecast.
Automakers scrambling for quick fixes to polish up vehicle economy numbers in the eyes of fuel-price-fatigued U.S. customers are reaping real results from their -- and the supplier community's -- investments in the new generation of six-speed automatic transmissions.
The powertrain sector's shift to six-speed automatics has been coming since as early as 2001, but $4-per-gallon gasoline and $5 diesel fuel has turned up the heat on vehicle engineers to deliver more or less immediate efficiency enhancements for existing vehicles.
American car buyers have been flocking to small cars, crossovers and hybrids so massively -- and so quickly -- that they're threatening to tip the auto industry on its axis.
They're leaving behind trucks, large SUVs and, to a lesser extent, luxury vehicles of all kinds in favor of more fuel-efficient and less-expensive segments. An Edmunds.com analysis shows that this shift has precipitated dramatically over the last two months, both in terms of actual transactions as well as in shopping trends measured on the Edmunds.com site. Until March, this pattern of segment migration had been accelerating markedly but rather gradually.
But a 10 percent increase in U.S. gasoline prices in March and April alone, to the realm of nearly $4 a gallon, appears to have provided the catalyst for a shift that is bigger and faster than any ever tracked by Edmunds.com.
Despite its mixed results with hybrids in the past, Honda sees the future being hybrids, and ultimately fuel-cell vehicles.
To that end, Honda plans to introduce four new hybrid models by 2015 to meet its eventual goal of selling 500,000 hybrid vehicles a year, a nearly tenfold increase from its current hybrid volume.
Speaking in Tokyo at the company's mid-term business meeting, Honda President Takeo Fukui confirmed what has long been known -- that Honda is working on its own take on the Toyota Prius, an affordable hybrid-only car, which Fukui said will be launched in the U.S., Japan and Europe in early 2009. He also announced Honda will introduce a hybrid version of the sporty CR-Z (pictured) and add a hybrid version of the tiny, already fuel-stingy Fit.
"It is important to move hybrid vehicles, from the current image-oriented stage to the new stage toward full-scale penetration," Fukui said in his speech.
That's how a former Toyota executive described the Toyota Prius.
And, today, as the Prius hit a hugely significant milestone -- 1 million plus sales since going on sale in 1997 -- that title seems all the more appropriate.
Toyota said Thursday it had sold 1,028,000 Prius cars worldwide -- it is sold in 40 countries -- as of the end of April.
Like the Model T, the Prius has become a brand on its own. Yet, Toyota is looking for even bigger things from the little car -- 1 million sales annually and the introduction of the next-generation model next year reportedly arriving in a number of variations.
As gasoline prices go higher, many hybrid-electric vehicles currently on sale are proving to be even wiser investments, says new data from Edmunds.com.
Considerable past discussion about hybrids has focused on "payback" time, or the period required for savings from a hybrid's enhanced fuel economy to recoup the initial higher purchase price a hybrid commands. Detractors often claimed that, from a strictly fiscal view of hybrids, most vehicle purchasers would never save enough in gasoline costs to recover their investment in expensive hybrid technology.
But with every increase in gas prices, the hybrid payback time becomes consequently shorter - to the point where some popularly priced hybrid models can pay back their owners' investment in as little as 18 months, according to the new Edmunds.com study.
Americans rushed to swap their thirsty trucks and SUVs for fuel-efficient cars in April, making the month a turning point for the industry’s biggest segment shift in memory.
The stampede to cars left in the dust a Detroit Three that simply weren’t ready for its magnitude because of their reliance on truck-based vehicles, while it lifted Japanese automakers whose traditional strength has remained in small cars.
As U.S. consumers definitively reacted to $3.50-a-gallon gasoline, passenger cars outsold truck-based vehicles for the first time in at least 20 years. The move comprised a shift of six percentage points for the industry compared with last April, to 54 percent car sales.
SANTA MONICA, Calif. â As gas prices rise this summer, automakers may well turn to marketing programs that include free gasoline instead of or in addition to cash rebates and low-interest financing, Edmunds.com predicts.
âGas prices are having a profound effect on the psychology of car-buyers, so we expect that automaker and dealer marketing tactics may include free gasoline programs this summer,â stated Jesse Toprak, executive director of Industry Analysis for Edmunds.com. "As indicated in Edmundsâ True Market Value Predictive Alerts, transaction prices of gas-guzzling large SUVs and trucks will likely continue to fall.â
Meantime, Edmunds.com estimated Thursday that the average automotive manufacturer incentive in the U.S. was $2,449 per vehicle sold in April 2008, up $13, or 0.5 percent, from March 2008, and up $39, or 1.6 percent, from April 2007.
Chevrolet Malibu is helping put Detroit back on the map in the mid-size sedan segment. Even the three-year-old Pontiac G6 and Ford Fusion are helping out on that front as well.
Of course, the real Big Three of the so-called “C†segment of the market remain solidly entrenched atop it: Honda Accord, Toyota Camry and Nissan Altima. Accord was the nation’s hottest-selling vehicle during the first quarter, according to Edmunds.com data, overcoming a sluggish start since the new model’s debut last fall to move 88,000 units from January through March. Camry, at 84,000 units, and Altima, with 76,000 sales, were right behind.
But domestic automakers nevertheless are encouraged by recent glimmers of hope in a crucial segment in which they haven’t been competitive for several years -- even though mid-size sedans used to be the Big Three’s bread and butter. At least the progress lately is a place to start.
Yet another sign consumer interest is turning from horsepower to fuel economy: the hybrid-electric version of the Toyota Camry, one of the nation’s best-selling cars, is outselling V6-powered Camrys by a solid margin.
For March, Edmunds.com data indicate sales of the Camry Hybrid set a new record: 6,930 units, or a considerable 22 percent of Camry’s 31,310 sales last month. Camry Hybrid monthly sales eclipsed 6,000 units only once since the car’s launch, in May 2007, when the 6,853 sold represented slightly more than 17 percent of total Camry sales.
SANTA MONICA, Calif. – As gas prices skyrocket, the biggest growth in April vehicle sales
are expected to be in small cars and small SUVS. In total, April vehicle sales likely will show a decline from April of last year but increase from this past March, according to a forecast by Edmunds.com.
Automakers are expected to report new vehicles sales, including fleet sales, of 1.3 million units for April, a 2.2 percent decrease from April 2007 and a 3.7 percent increase from March 2008, Edmunds.com predicts. April 2008 had 26 selling days, two more than last April 2007. When adjusted for this difference, sales decreased 9.7 percent from April 2007.
“It’s clear that gas prices are weighing heavily on car-buyers’ minds," observed Jesse Toprak, Edmunds.com’s executive director of Industry Analysis. “We predict that this month, the segments with the most year-over-year growth will be compact SUVs and compact cars at 52 percent and eight percent, respectively.â€
Imagine a Toyota Prius, but faster, cleaner and greener. Such a car is coming soon and will launch at the Detroit auto show in January 2009.
America has fallen for the Prius in a big way, no doubt about that. Five years on, through an extraordinary combination of style, engineering and marketing, Toyota's fuel sipping hybrid remains the absolute gold standard for eco cars in the industry.
The next generation, however, has all the makings of an even bigger hit. That's because it will be a touch bigger so offering more space. It will come with stronger 1.8-liter hybrid performance yet at the same time boast even better economy and class leading emissions, if early word is correct.
In other words, everything Americans like now about the Prius, including its unique design and crusading eco image, but in a 'smarter,' more high-grade package.
While most eyes are on the global sales and production race between Toyota and General Motors, another interesting contest is developing in the U.S. – between the Ford and Toyota brands.
For the past two months, the Ford brand has outsold the Toyota brand. Ford’s recent gains narrowed the gap for the first quarter to less than 3,000 vehicles between it and Toyota. In 2007, Toyota closed the books 127,606 vehicle sales ahead of Ford. Throughout 2007, Toyota led Ford by about 10,000 plus vehicles a month.
General Motors Corp. says its first-quarter 2008 global sales reached 2.25 million vehicles, a drop of less than one percent despite the drag of lagging North American sales.
GM sales of 947,000 units in North America was a roughly 10 percent drop compared with 2007’s first quarter. GM executive director of global market and industry analysis Mike DiGiovanni said the number “exceeded our internal forecasts,†but also says, counter to some industry analysts, GM does not expect U.S. sales to shore up in the second quarter. DiGiovanni said the company does not anticipate a firming U.S. market until at least the second half of the year.
As Earth Day comes around once more, there are a few different scoreboards for tracking the relative progress of automakers in their attempt to win the green derby.
According to Toronto, Canada-based consumer-research firm BrandIntel’s recent survey of online discussion, for example, Toyota, Honda, Mercedes and Volkswagen have the most “green credibility†due to their hybrid and diesel vehicles. General Motors and Chrysler have been stuck among the least-credible because of their large fleets of trucks and SUVs and weaker lineups of hybrids and diesel options. Ford sits in the middle.
But several automakers are forging strategies for changing such scoreboards in their green credentials. A look at a few:
Toyota clearly donned it for awhile. Ford tried it on for size. American consumers seem to think it fits Honda pretty well these days. But no one covets it more now than General Motors.
We’ll call it the “green mantle:†a figurative decoration on the shoulders of automaker that tells the world, and competitors, that their company is the most environmentally renowned in the industry, both for their products and technologies and – perhaps even more important – in the public’s overall regard.
And taken particularly in the context of an annual worldwide recognition such as today’s Earth Day, it seems at least as important for any corporation to earn the perception of environmental responsibility as to actually be doing something tangible.
The massive gears of the auto industry’s manufacturing sector continued to grind out a changing tune this week, reacting to larger, macroeconomic forces in the U.S. economy that are mandating interesting, if not wrenching, change, particularly for the domestic Big Three automakers.
On Thursday, union leaders for United Auto Workers Local 602, representing workers at General Motors Corp.’s Delta Township assembly plant near Lansing, MI, called a strike because the local has yet to sign a plant-level contract with GM, despite what it claims have been months of negotiation. The plant assembles GM’s new generation of crossover utility vehicles, the GMC Acadia, Saturn Outlook and Buick Enclave. The Enclave and Acadia have been selling briskly.
Normally stolid Toyota Motor Corp. hasn’t been shy in doubling of its stake in Fuji Heavy Industries Ltd. and openly admitting the two will jointly develop new vehicles – including an all-new rear-wheel drive sport coupe on a dedicated platform.
Whew. Quite un-Toyotalike. This is the company that rarely “buys†anything or anybody, preferring joint ventures, particularly when it comes to vehicle development and vital components. When it decided to build cars with General Motors, Toyota bought nothing; it established New United Motors Manufacturing Inc. (NUMMI) in California, which jointly makes vehicles for Toyota and GM.
Shares of Toyota and Isuzu led Japanese car stocks lower in Tokyo Monday on concerns that a sales slump in the U.S. may cut into their profits, Bloomberg News reported.
Shares of Nissan, Yamaha and Fuji Heavy Industries, an affiliate of Toyota and the parent company of Subaru, also fell after it was revealed Friday that consumer confidence in the U.S. sank to a 26-year low in April, as gasoline prices rose and the labor market weakened.
Isuzu, Japan's largest truck maker, announced recently it would stop selling its sport-utility vehicles in the U.S. Last Friday, Toyota announced it was upping its stake in Fuji Heavy Industries and the two were developing a sports car together.
Japanese automakers Toyota, Daihatsu and Subaru parent, Fuji Heavy Industries,
announced they have joined forces to develop new vehicles, including a small rear-drive sports car, and supply each other with cars. As expected, Toyota also doubled its stake in Fuji, a stake that could go even higher.
The agreement unveiled at a press briefing in Tokyo Thursday calls for the following product actions:
· Toyota and Fuji will jointly develop a compact rear-drive sports car to be marketed by both companies;
· Toyota will provide Fuji with a compact car;
· Daihatsu will supply Fuji with minivehicles and a version of the Daihatsu Coo compact car.
The trio's joining forces represents a sign of the times -- further consolidation of the global auto industry and increased cooperation among automakers to cut costs. The arrangement allows the companies to beef up their product portfolios, especially with slim-profit small cars, run assembly plants at full capacity and share development costs so no one company has to go solo on all such costs.
TOKYO — Japan is buzzing with news that Toyota plans to raise its stake in Fuji Heavy Industries, Subaru's parent company, from 8.7 percent up to around 17 percent.
The story was broken by the Nikkei, Japan's well-connected business newspaper, has since been picked up by other media, not denied
by either Toyota or Subaru.
Indeed, a spokesman from one of the companies admitted privately "the Nikkei got a scoop." All of which seems to back up the Nikkei's claim that Toyota will pick up 64.25 million shares in FHI for around ¥30 billion (some $306 million).
Ever since Toyota became the leading shareholder in Fuji Heavy Industries in October 2005 in the wake of the company’s hasty divorce from General Motors, many in Japan believed it was simply a matter of time before Toyota upped its stake.
So why now? Because up to a point, both companies need each other.
Toyota Motor Corp. denied Wednesday it had received any funding from the Japanese
government to develop its Prius hybrid, The Associated Press reported.
Former Toyota executive and board member Jim Press, now vice chairman and president of Chrysler, had been quoted in the March 24 issue of Business Week magazine as saying, “The Japanese government paid for 100 percent of the development of the battery and hybrid system that went into the Toyota Prius."
Automakers in March finally experienced the full brunt of two huge economic problems that had been nibbling at their market for months: rising gasoline prices, and American consumersâ falling economic expectations.
Sales for the industry dropped 11.9 percent in March, to 1,351,838 units, the worst performance for the month since 1993. Even more significant, the results accelerated a market deterioration that saw overall U.S. auto sales fall by 7.8 percent to 3,565,828 units for the first quarter. Annual sales rates, seasonally adjusted, slipped to near 15 million units.
A wicked combination of $3.50-a-gallon gasoline, higher prices for food and other necessities, mortgage woes and a shaky stock market left many American consumers more nervous and dispirited than anyone had expected them to be just a few months ago.
âWeâre seeing new-car sales decline, not because people canât afford them, but because thereâs a lack of trust in the stability of the economy,â said Jesse Toprak, chief industry analyst for Edmunds.com. âThereâs been a real erosion of wealth, and consumers are not in the mood to shop for a car. This is more of a psychological impact more than the inability to purchase a new vehicle.â
Toyota announced Tuesday it is establishing a North American research institute at its Detroit-area facility and plans to spend $100 million during the next four years on advanced research.
The Toyota Research Institute of North America initially will employ 35 researchers and staff in Ann Arbor, Michigan, where Toyota already has a technical center, and plans to add 10 researchers this year and 20 more by 2010. Toyota hinted the institute will be used for its environmental efforts.
SANTA MONICA, Calif. â The average automaker incentive was largely unchanged in March compared with February, but incentives generally are likely to rise for the next several months as automakers try to break the sales slump, Edmunds.com predicts.
"Incentives are likely to rise through the spring and summer," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com. âWe anticipate that this will be especially true for the European automakers, as long as the euro remains strong.â
Toyota Corolla and Honda Accord are icons of the Japanese automakers’ rise to U.S. market dominance over the last generation — reliable performers on the road, steady draws in the showroom, dependably lauded by public and press alike. And the OEMs have just produced a new generation of each venerable model.
But the long, long run of success could be nearing an end for both Accord and Corolla. Year-to-date sales are off for each nameplate more than for each OEM overall. Proliferating competition â some from sibling models â is squeezing them. Consumer consideration of Corolla or Accord doesnât translate as predictably as before into purchase. High gasoline prices and a shaky economy have roiled the picture still further.
SANTA MONICA, Calif. — Despite an abundance of rich incentive deals, March
vehicle sales for the industry are expected to be lower than March 2007 and even lower than February when automakers report results Tuesday, Edmunds.com
has forecast.
March new-vehicle sales, including fleet sales, are expected to total 1.33 million, a 13.2 percent decrease from March 2007 and a 13.9 percent increase from February 2008, according to Edmunds’ forecast on sales figures not adjusted for the difference in selling days.
The forecast is less dreary when adjusted for the difference in selling days. This March had 26 selling days, two fewer than last March 2007. When adjusted for this difference, sales decreased 6.5 percent from March 2007.
Analysts and industry-metrics powerhouse J.D. Power and Associates already are predicting a heavy downturn in auto sales for March, based on sales figures from the first half of the month. Now, analysis from Edmunds.com is providing perspective on how bad not just March, but first-quarter sales are likely to be when announced next week.
Based on average sales for the first two months of 2008 compared with last year, the Detroit Three automakers have virtually insurmountable deficits to recover to match first-quarter sales from last year. But longstanding sales juggernaut Toyota Motor Corp. â and several other Japanese automakers â won't be likely to fare much better in what is shaping up to be the brutal retail-sales environment many had predicted.
Indeed, everyone predicted 2008 car sales would be worse than those in 2007; the analysis shows just how much worse in the early going. Some forecasts predict an uptick in the second half; others do not.
TOKYO — The Japanese auto industry’s seemingly unstoppable ability to grow profit
is grinding to a halt, Reuters
newswire reported Tuesday.
The sector, led by Toyota, Nissan and Honda, has grown profits for seven straight years by expanding sales in overseas markets and cutting costs. But a slide in profits looks increasingly likely in the next business year that stars in April due to a slowing U.S. economy, rising costs for steel and other commodities and the U.S. dollar's tumble to a 13-year low against the Japanese yen.
Not surprisingly, major automakers saw retail sales drop in the first half of March compared with the same period a year ago, according to a report by research firm J.D. Power and Associates. The firm predicts total March sales will hit an annual selling rate of 15 million, dramatically lower than the 16.2 million rate of a year ago.
J.D. Power said in a report to its clients cited by Dow Jones that March saw year-over-year double-digit declines in retail car sales at General Motors, Ford and Chrysler. Toyota's sales also were off in the early weeks of the month.
J.D. Power recently reduced its 2008 car sales forecast to below 15 million, which would be the lowest level since 1994.
NEW YORK — The New York International Auto Show opens to the public Friday, and what a difference a year makes.
Toyota is the nation’s second-largest brand not Ford. Jim Press is the vice chairman and president of Chrysler, not Toyota. Cerberus Capital Management, not Daimler, owns Chrysler. The national average price for a gallon of premium gas is $3.60, not $2.80.
And the most interesting cars at the New York auto show are diminutive and original, not colossal and extravagant.
You know the economy is bad when the endlessly thriving Toyota says it may not hit its sales targets.
Remarks by Toyota executives in South Korea on Wednesday about the economy echo those being made by other auto company executives during this week's press days for the New York auto show where the economy, more than the cars, grabbed the spotlight.
Toyota Motor Corp. has confirmed it is planning to cut production at truck-assembly plants in Texas and Indiana because of the economic and vehicle-sales slowdown.
Toyota is trimming production at its San Antonio plant that builds the full-size Tundra pickup truck, introduced a year ago, and at its Princeton, Ind., plant, which builds a mix of trucks and full-size sport-utility vehicles, including the newly redesigned Sequoia.
Toyota will not say how much it is cutting production at those plants.
Exactly a year ago, in March 2007, the media and airwaves were full of stories about the fast-rising value of the yen. The Japanese currency had soared from ¥120 to the dollar up to ¥115, and to some it was like the yenshock era of the '80s returning.
How Japan's auto industry, which gets hurt with every appreciation of the yen, would love to see ¥115 again.
February was an awful sales month for the U.S. auto market. If the
industry isnât in its own recession against the backdrop of general
economic uncertainty, itâs surely looking for the bottom.
Overall sales dropped by 6 percent compared with February 2007,
following a year-over-year decline of 4 percent in January. The pace
represented a seasonally adjusted annual rate of 15.5 million to 15.8
million vehicles, General Motors said. In the first two months of the
year American consumers bought about 2.2 million cars and trucks, or
about 126,000 fewer than in 2007.
Automakers will always do brand building via traditional advertising media such as TV, radio, outdoor and print. But in an ever-toughening marketplace, they’re more and more intent on obtaining solid sales leads and on buttressing relationships with existing customers — so they’re putting their marketing resources into the channels that best deliver on those goals.
That’s the main reason the Internet will be vacuuming up a much bigger share of vehicle-advertising dollars in the U.S. market in 2008.
SANTA MONICA, Calif. â February car sales likely will be off some from year-ago levels but improved from dismal January when automakers report them Monday, according to a forecast by Edmunds.com.
Februaryâs new-vehicle sales are expected to be 1.22 million units, a 2.3 percent decrease from February 2007 but a 16.8 percent increase from last month.
"The month is proving better than some industry watchers may have expected," observed Jesse Toprak, Edmunds.comâs executive director of Industry Analysis. âThis month should exceed the typical 10 to 15 percent boost in sales from January, historically the slowest car-sales month of the year.â
News from the U.S. financial media cites a report from Japan as saying Toyota Motor Corp. plans to fund several new advanced-research groups in the U.S.
Media in Japan are reporting Toyota will establish new U.S.-based research teams for alternative energy, safety and advanced materials. The company typically has engaged such long-term research only in Japan.
Auto-marketing executives know they’ll be advertising more on cell phones and other mobile devices in the coming months. But they still have a “prove-it†attitude toward the medium, as mobile-service providers work through issues such as image enhancement and platform standardization.
“The biggest issue with mobile is still that we have to do everything different for each different carrier,†said Gregg Benkendorfer, Toyota’s national manager of media and digital. “Until they really sort that out, I don’t think you’re going to see tremendous growth.â€
Christine MacKenzie, Chrysler’s executive director of multi-brand marketing and agency relations, said mobile-advertising providers still can’t “provide us enough data to justify a major move into mobile yet.†She added, “it’s still an area where we’re learning, and we’ll continue to learn.â€
But carmakers clearly are moving into mobile in a significant way nonetheless, encouraged in part by the booming popularity of Apple’s iPhone and the richness of its interface.
Maybe, more than six years after 9/11 and nearly five years after the start of the war in Iraq, consumers are tired of patriotic pitches. Maybe the unmitigated globalization of auto production makes it just too hard. It might be that âgreenâ marketing doesnât leave room for the red, white and blue. Or perhaps the idea is just in a lull.
But whatever the reasons, the use of âMade in Americaâ themes in car marketing seems to be at a generational low these days.
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.
Toyota has begun offering customers 84-month loans on new cars to help dealers sell cars during the current economic downturn, an initiative that has some upside potential but also some risk for Toyota, said Joe Spina, Edmunds.comâs senior manager of remarketing.
âIf Toyota Financial Services indeed offers these loans to customers with high credit scores and doesnât do many 84-month loans as a percentage of its loan portfolio, then the risk of credit loss is low,â said Spina.
But, he added, âThe risk with an 84-month loan is that customers may be purchasing a vehicle they really cannot afford. That could put them upside-down in the loan for longer. Then the loans become a tool that perpetuates negative equity financing.â
The boom in crossovers is the biggest product story in the U.S. auto market these days. Sales increased to more than 2.8 million last year, extending a seven-year surge, and now more than 50 separate models of utility vehicles are offered on car-based platforms.
A couple more joined the fray at the Chicago Auto Show this week when General Motors unveiled the Chevrolet Traverse and Ford showcased a spiffed-up Ford Edge Sport.
Funny thing is, the more new crossovers that emerge, the more they look and feel essentially the same. One after another they’re being launched by automakers up and down the price scale, but more often than not they pretty much end up looking like some model year of the Lexus RX.
The small-truck market is disappearing, but it appears some automakers are at least giving some thought to trying to resuscitate it by reinventing it.
“It’s pretty bleak,†said Jessica Caldwell, Edmunds.com’s manager of pricing and industry analysis, of small truck sales of late. “They may be even worse than minivan sales.â€
Still, with small cars making a comeback due to high gas prices, automakers such as General Motors, Toyota and Ford think the small-truck segment could be brought back to life as well.
Toyota posted a profit that set a new record for a third quarter, thanks to strong sales in emerging markets, but the quarter demonstrated Toyotaâs growth is slowing.
Toyota reported a profit of $4.29 billion, up 7.5 percent from the year ago for the October-December fiscal quarter. Revenues rose 9.2 percent to $62.79 billion. Toyota sold 2.281 million vehicles in the period, up 5.8 percent from a year ago.
Despite setting a quarterly profit record, the 7.5 percent increase in income represents the smallest gain since December 2006, and the 9.2 percent sales increase was the smallest gain in 2½ years, according to Bloomberg Newsâ records.
The New York Giants certainly achieved their Super Bowl objectives Sunday. Did car companies?
It’s too early to tell. But automakers led the way in a field of Super Bowl ads that largely disappointed on their creative merits and failed to generate the kind of instant excitement that could help them meet their marketplace goals. In some cases, it didn’t seem as if their advertising approach was actually consistent with the strategic challenges faced by the company.
And when you’re paying $2.7 million for 30 seconds of rapt attention by the biggest TV audience of the year, you really should take advantage of the opportunity.
Toyota Motor Corp. may report the smallest profit growth in four quarters because of the rising yen and slowing U.S. demand, Bloomberg News reported Monday. Toyota announces its quarterly earnings Tuesday.
SANTA MONICA, Calif. â The average auto manufacturer incentive in the U.S. was $2,401 per vehicle sold in January, up $167, or 7.5 percent from January 2007, and down $56, 2.3 percent, from December 2007, Edmunds.com estimated Friday.
âIn January, automakers decided to be more generous in their incentives spending in hopes of counteracting the slowdown in demand,â said Jesse Toprak, executive director of Industry Analysis for Edmunds.com.
âWe do not foresee a dramatic turnaround in market conditions for at least the next several months, and yet the race for increased market share is in full force,â added Toprak. âThis will provide a test of the automakersâ discipline about incentives, especially that the of the domestics who have been employing a âvalue pricingâ strategy quite successfully recently."
If you’re one of those cynical types who think people are buying hybrid-electric vehicles mainly to demonstrate their environmental hipness, results of a new fuel-price study by Edmunds.com indicate hybrid buyers may not be nearly so superficial:
They’re buying hybrids to save gas.
Edmunds analyzes the number of visits for every vehicle in the market to that model’s Vehicle Details page at Edmunds.com. It correlated those visits to extrapolate what would happen if the price of gasoline rose from its $3.01 price in December to a theoretical $4 per gallon.
Bottom line: Online vehicle shoppers flock to hybrids. And flee traditional midsize SUVs.
As the global stock market plunged on worries that the U.S. is in recession, shares of Toyota fell the most they had in seven years in Tokyo trading, Bloomberg News reported.
Toyota stock plunged 7.2% to 4,880 yen at the 3 p.m. close on the Tokyo Stock Exchange Tuesday. Honda shares slipped 6% to 2,915 yen. Nissanâs stock declined 6.4% to 922 yen.
While Bloomberg noted the threat of a recession in the U.S. spurred the decline in the global stock market, the stocks of Japan carmakers were also hurt by the Japanese yenâs strengthening against the U.S. dollar to its highest level in almost three years.
In a story posted on Edmundsâ Green Car Advisor, automakers voice their concern that recent laptop computer battery fires donât lead to safety concerns for batteries in hybrid cars.
The latest such incident, reported earlier this week, was with a computer outfitted with a lithium-ion battery manufactured by Koreaâs LG Chem â one of two battery makers General Motors Corp. has charged with developing the lithium-ion battery pack for a production version of its tirelessly-touted Chevrolet Volt hybrid-electric vehicle.
Withering vehicle demand and a dollar battered on world currency markets means 2008 will see many automakers beginning a high-stakes dance to make more efficient use of production capacity in North America.
The efforts are most critical for Detroitâs Big Three automakers â General Motors Corp., Ford Motor Co. and Chrysler LLC. Each is struggling to rationalize fading market share with a 2008 vehicle-sales forecast projected to be the U.S.âs lowest in a decade or more.
Underutilized plant capacity is an immense black eye for the bottom line in the best of economic environments, much less a 2008 expected to flirt with full-blown recession and what some believe is a dangerously weak currency.
Each of the Big Three recently won momentous labor-cost concessions from the United Auto Workers union, but that wonât change the fact each still must markedly downsize their manufacturing footprints.
The year 2007 was historic for motor vehicle sales in the U.S. on a number of fronts.
Overall, the U.S. auto industry, which reported December and full-year 2007 sales on Thursday, saw sales drop to their lowest level in a decade.
For the first time since 1931, Ford Motor Co. was not the No. 2 automaker in the U.S.; Toyota was, even though Toyota suffered sales declines in some months for the first time in years.
Depending on what you count in the numbers, Toyota Division could be considered the best-selling brand in the U.S. Chevrolet objects, claiming Toyota shouldn't add into its totals Scion-branded vehicles in order to steal Chevroletâs long-held sales crown.
And in 2007, for the first time in history, domestic automakerâs share of their home market fell below 50% in July, though for the year, they stayed above the 50% mark. Consider it was only in the mid-1980s that they owned 75% of the U.S. market.
Toyota Motor Corp. overtook Ford Motor Co. to become the No. 2 automaker based on U.S. sales for 2007. Ford held the No. 2 spot behind General Motors for 75 years.
The battle for brand leadership between Toyota and Chevrolet is muddied -- but close and intense.
If sales from Scion, sold through Toyota Division showrooms, are included in 2007 sales totals, Toyota wins over Chevrolet for the first time as the top-selling brand in the U.S.
Take out Scion, however, and Chevy holds onto the top spot, but by a narrow margin -- one that has been narrowing in recent years.
The average automotive manufacturer incentive in the U.S. is estimated to have been $2,472 per vehicle sold in December 2007, up $197, or 8.7 percent, from November 2007, and up $157, or 6.8 percent, from December 2006, according to calculations by Edmunds.com.
Domestic automakers as well as European, Japanese and Korean ones raised incentives in December in an attempt to end the year on a high note.
However, sales reports, being released on Thursday, indicate that note was not so high. Industry sales for the year are expected to come in at 16.1 million, the lowest level since 1998.
Often a particularly challenging year is sent passing into the history books with a collective âgood riddanceâ and sigh of relief. And while automakers selling vehicles in the U.S. surely are glad the tough 2007 is over, they are bracing for rather than embracing the arrival of 2008.
On Thursday, automakers report December and full-year 2007 vehicle sales. 2007 is likely to see the lowest sales since 1998.
Forecasters predict 2008 sales will be even lower. But 2009 could be a turnaround year.
When Chrysler CEO Bob Nardelli didn’t like the negative stories being written about the automaker in the
business press over the past couple of weeks, he didnât write nasty letters to the editor that may or may not have been published. He didnât call a press conference to discredit the reports.
He blogged.
He used Chrysler’s The Firehouse blog to set the record straight that the automaker was not in the dire financial straits that had been reported. He insisted Chrysler was making progress in its turnaround and had the full backing of new owner Cerberus Capital Management.
The day after Chrysler posted Nardelli's blog, newspapers covered it as a story, demonstrating one of the many ways automakers are using blogs to get their viewpoints across as well as to communicate with customers and potential buyers.
TV advertising is spiced with year-end incentives for auto buyers. Mercedes-Benz shows Santa’s elves tinkering in his workshop on E- and C-class sedans for its Winter Event program. It’s Happy Honda Days! General Motors is revisiting its now-annual Red Tag clearance sale for 2007 models.
Lexus has renewed its iconic incentive program that tries to lure consumers into putting big red Christmas bows on new vehicles and parking them in the driveway for their loved ones. And Lincoln is running a copycat campaign.
But don’t be fooled by airwaves full of incentive advertisements: as enticing as they seem, these offers only amount to a holiday treat. That’s because money-back and cut-rate-interest programs aren’t what they used to be in the auto industry.
SANTA MONICA, Calif. -- Edmunds.com recently selected six applicants from the “Editor for a Dayâ€
submissions to experience and write about a professional comparison test of three midsize family sedans: 2008 Chevrolet Malibu, 2008 Honda Accord and 2007 Toyota Camry.
The winners were flown to Los Angeles, given appropriate accommodations and training, then encouraged to put the comparison test vehicles through a series of driving exercises at Willow Springs International Raceway on November 29. The winners carefully evaluated the vehicles and their commentary was published on Edmunds.com.
“This is the first time we invited real consumers from around the country to work with us on an actual road test,†said Kevin Smith, editorial director for Edmunds.com.
In the end, three of the demographically and geographically diverse group were split: three (including the two women in the group) chose the Malibu as their favorite; three chose the Accord.
Here is a summary of the “Editor for a Day†winner profiles and their comparison test experiences:
General Motors captured four of the six spots for finalists for the North American Car and Truck of the
Year awards; a Honda and a Mazda rounded out the roster.
Finalists for the 2008 North American Car of the year are: Cadillac CTS, Chevrolet Malibu and Honda Accord.
Finalists for the 2008 North American Truck of the Year are: Buick Enclave, Mazda CX-9 and Chevrolet
Tahoe Hybrid.
The finalists for the prestigious awards were announced Wednesday at a luncheon sponsored by the Detroit Economic Club to promote the Detroit auto show. Winners will be announced at the first press conference of the show on January 13, 2008.
GM swept the 2007 awards, with the Saturn Aura winning car of the year and the Chevrolet Silverado
winning truck of the year in January. An encore sweep could be in the offing. If that happens, it would mark the first time a manufacturer won both awards two years in a row since the awards were created in 1994.
SANTA MONICA, Calif. -- With 11 months of vehicle sales reported, the biggest losers and winners â- and those brands that are on the move to new sales rankings â- are being predicted by Edmunds.comâs analysts.
The biggest losers for 2007 look to be: Ford division; Isuzu; Buick; Hummer; Toyotaâs Scion; and Jaguar.
The biggest winners for 2007 likely will be Mazda, Lincoln and Mitsubishi, all of which have surpassed total 2006 sales in just the first 11 months of the year.
November car and truck sales weren't great, but, in light of current circumstances, they could have been worse, concluded Edmunds.com's analysis of November sales figures reported by automakers Monday.
Jesse Toprak, executive director of Industry Analysis for Edmunds.com, noted the retail market, despite the weakening economy, the fallout from the housing market and higher energy prices, remained relatively stable this November compared with the last one.
âWeâre seeing modest gains though not robust ones,â he said. âWeâre still doing fairly well considering the market and macroeconomic issues.
The Toyota Prius has become a brand unto itself; the single hybrid car is outselling entire brands with
their full lines of models.
The Prius more than doubled sales in November compared with November 2006. Prius outsold the entire Acura, Saturn, Buick, Subaru and Mercury brands. It came close to outselling the Cadillac and Volkswagen brands.
That's to name only a few. (See chart below)
And November wasn't even Prius' best month. In November, Toyota sold 16,737 Prius hybrids; in May, Toyota sold more than 24,000.
TOKYO -- Like many Car of the Year contests, Japan’s COTY can throw up the occasional unexpected
result.
But not this year.
Going into this year’s showdown, many wise souls predicted that the new Honda Fit would win at a canter. And that in the end is exactly what happened.
SANTA MONICA, Calif. â Incentive spending by automakers remain roughly flat in November, as manufactured tried to stick their plans for less incentive spending to boost profit margins. Yet, the plan may prove to contribute to softer vehicle sales, being reported by manufacturers throughout Monday.
"Even with the year-end sell-down upon us, the domestic automakers have stayed committed to the value pricing strategy that limits their investment in incentives,â said Jesse Toprak, executive director of Industry Analysis for Edmunds.com.
SANTA MONICA -- This month's new vehicle sales (fleet and retail) are expected to be 1.2 million units, virtually unchanged from November 2006 and 2.5 percent below October 2007, according to Edmunds.com.
"Given the industry trends, we have adjusted our year-end forecast," stated Jesse Toprak, Edmundsâ executive director of Industry Analysis. âWe now expect 2007 sales to total 16.13 million units, and predict that no more than 16 million cars and light trucks will be sold in 2008."
After nearly four months of earnest talk, surprise strikes at General Motors and Chrysler LLC and some creative wheeling and dealing, American carmakers finally have new labor agreements -- ones that almost wipe out the cost advantage enjoyed by Asian rivals operating in the U.S. without union contracts.
Sean McAlinden, vice president of research at the Center for Automotive Research (CAR) in Ann Arbor, Mich., said it will take U.S. carmakers two to four years to reap the benefits of all the changes embedded in their new contracts with the United Auto Workers.
But the cost savings are genuine and substantial, he said.
TOKYO -- Last week Toyota posted record half-year earnings, including a blockbuster $7.9 billion in group net income. Japan’s most successful automaker also has a couple of other things to celebrate.
Toyota has long dominated its home market, but even by its standards the sales results for October were pretty remarkable. Last month, Japanese vehicle sales dipped again, down 1.3 percent, according to Japan Automobile Manufacturers Association (JAMA) figures. Yet Toyota beat the market with an aggressive sales surge of 7.9 percent.
What’s more, somewhat freakishly, eight out of the Top 10 bestsellers were Toyotas.
Now that the “regular-season super bowl†is over -- with the New England Patriots’ defeat of the Indianapolis Colts last Sunday -- football advertisers as well as fans are turning more attention to the official Super Bowl XLII on February 3.
And despite the fact that Fox already has sold out more than 90 percent of its commercial spots for the game broadcast, automakers aren’t among the major advertisers clamoring to get in.
In fact, General Motors and its divisions have decided to cut the company’s total number of in-game TV advertisements down to just one, compared with three during the 2007 Super Bowl, AutoObserver has learned. Honda has decided for the first time in four years to bow out of running spots during the Super Bowl telecast itself. And Chrysler seems likely, just as last year, to stay away from the game telecast itself.
TOKYO -- In contrast to General Motors record loss, Toyota Motor Corp. posted its second-largest
quarterly profit ever, prompting the Japanese automaker to increase its full-year profit forecast.
For the quarter ending September 30, Toyota reported a net profit equivalent to $3.96 billion, up 11 percent form the same period a year ago. As a result of the strong quarter, Toyota said it was increasing its full-year profit forecast by 3 percent to 1.7 trillion yen. That would surpass last year’s record and mark the seventh consecutive year of record profits.
Toyota also raised its estimates for the number of vehicles it expects to sell globally –- 8.93 million, up from the earlier forecast of 8.89 million.
Toyota announced Tuesday that Jim Lentz, currently executive vice president of Toyota Motor Sales, U.S.A, Inc., the marketing arm of the Japanese automaker, has been promoted to president.
"Jim Lentz is especially well qualified to lead TMS into the future as it marks 50 years in America," said TMS Chairman Yuki Funo in a statement. "His experience spans all major operational areas and he has an outstanding sense of what our customers, dealers and associates expect from Toyota."
Lentz, 52, has spent 29 years in the auto industry and joined Toyota in 1982.
October car sales represented more of the same weakness seen in recent months.
Sales on a seasonally adjusted basis came in at 16.05 million vehicles, down from 16.35 million in October a year ago.
âThere was nothing new this month, as we saw General Motors and foreign automakers continue to succeed,â said Jesse Toprak, executive director of Industry Analysis for Edmunds.com. âFord did better than expected because of its new products, mainly crossovers, and Ford has been able to hold on to its truck buyers, even with an aging product.
âWeâre expecting that sales will continue to be sluggish for the rest of the year, and November has typically been a slow month for automakers,â he added.
The trade group representing automotive importers has said it will not fight a combined 35 mile per gallon fuel economy standard being considered by the U.S. Congress, but its members want more time to meet the stiffer standard.
The Association of International Automobile Manufacturers wants the deadline for meeting the tougher standards pushed significantly back from the proposed 2020 timeline. The lobbyist group represents more than a dozen import nameplates, including Toyota, which had sided with Detroit automakers in seeking lesser standards that separate car and truck ratings. The only AIAM members that sell large trucks are Toyota and Nissan.
Octoberâs new vehicle sales are expected to be 1.24 million units, a 2.4 percent increase from October 2006 on an unadjusted basis, according to a forecast by Edmunds.com. Automakers will report October sales results on Thursday.
This October had 26 selling days, one more than October 2006. When adjusted for this difference, sales decreased 1.6 percent from October 2006. (The chart below sets forth other adjusted and unadjusted comparisons.)
"Sales are strong for vehicles at the far ends of the price spectrum, as consumers affected by the housing market bust seek bargains while luxury buyers are largely untouched," observed Jesse Toprak, Edmundsâ executive director of industry analysis. âMeanwhile, sales of midrange vehicles like large cars and minivans are suffering."
Every year when the vehicle-customization industry gathers at the Specialty Equipment Market Association (SEMA) show in Las Vegas, one group of attendees is always more engaged than the year before: auto company executives.
Tapping into the customization and specialization craze is boosting their top lines and beefing up their bottom lines more than ever before, producing juicy double-digit growth that normally isn’t part of the landscape in the highly mature U.S. automotive market.
At least 14 automakers were expected to exhibit at the SEMA show that began in the Las Vegas Convention Center on Tuesday. Understandably, each automaker is getting more and more serious about pursuing slices of what has become a $36.7-billion industry, according to figures compiled by Diamond Bar, California-based SEMA.
TOKYO -- Toyota's vaunted quality is slipping, its once-unassailable environmental credentials are being criticized, and several key members of its U.S. management have been wooed away in recent weeks by restructuring rivals. Sales are slipping in its home base as the Japanese population ages, and the U.S. market -- its biggest -- has stalled.
But Toyota Motor Corp.'s top executive says that plans already in place are sufficient to stop the erosion and bolster its position as the globe's leading automaker. The company doesn't see a need to revamp its business structure, President Katsuaki Watanabe said in an interview in Tokyo last week.
Instead, it needs to move ahead with a set of initiatives aimed at restoring top quality and making Toyota a leader on issues of energy, environment and safety, he said.
Key among them are continuation of the automaker's $1-million-an hour research and development effort; expansion of its hybrid car technology; and development of a low-cost, low-emissions "world car" that could sell in developing nations for as little as $4,000.
TOKYO –— Honda announced at the Tokyo Motor Show that at the upcoming Los Angeles show it will
introduce a new hydrogen-powered fuel-cell vehicle based on the FCX concept, displayed here and at past shows. Honda will begin deliveries of the car to customers in the U.S. and Japan next year.
Honda executives on the sidelines were quick to point out that it will allow customers — both retail and fleet — to actually lease the fuel-cell vehicles on their own in contrast to General Motors’ recent program.
General Motors regained its title as worldâs largest automaker when Toyota reported Monday it had sold fewer vehicles than GM in the July-September quarter.
The score with three quarters of the year over stands at Toyota selling 7.05 million vehicles and GM at 7.06 million sales. The race is tight, however. Toyota sold 2.34 million vehicles in the July-September quarter; GM sold 2.38 million.
At the half-year point, Toyota looked like it would take the No. 1 title GM has owned for 76 years. Analysts expect it to happen eventually. Toyota has an aggressive target to sell 10.4 million vehicles for 2009; GMâs best year was in 1978 when it sold 9.55 million vehicles. Where Toyota still has a firm hold on a No. 1 spot is in profitability.
Over the coming days, many of the industry’s leading lights will be boarding flights to Japan for the 40th Tokyo Motor Show, which opens its doors to the world on Wednesday, October 24.
What will be big in Japan this year?
First, technology and plenty of it, much of it geared inevitably toward the environment through a fresh array of plug-in hybrids, electrics, clean diesels and more.
Next, speed and excitement, courtesy of a new wave of Japanese high-performance cars, led by the Nissan GT-R and new Subaru Impreza WRX STI.
Third, plenty of show concepts, (28 at the last count), some serious, some less so, and as ever it’s the latter than helps give the Tokyo Show its unique fun and fantasy feel.
DETROIT -- After years of sterling reliability, Toyota is showing cracks in its armor, according to data
from Consumer Reports’
2007 Annual Car Reliability Survey revealed Tuesday before the Automotive Press Association in Detroit.
By contrast, Ford’s domestic brands have made considerable improvements. Consumer Reports said 93 percent of Ford, Lincoln, Mercury models in the survey scored average or better.
“Ford continues to improve,†said David Champion, senior director of Consumer Reports’ Auto Test Center. “The reliability of their cars has steadily improved over the years, and is showing consistency.â€
He added, “We believe Toyota is aware of its issues and is trying to fix problems quickly.â€
Despite the problems, Toyota (including Lexus and Scion) still ranks 3rd in reliability among all automakers, behind only Honda and Subaru.
Ford announced Thursday that it has hired Jim Farley away from Toyota. Farley, 45, currently group vice president of Lexus, will be Ford's first global chief marketing and communications officer.
"I wanted to bring to our team world-class marketing talent," Ford CEO Alan Mulally told AutoObserver in a phone interview just after the Ford board of directors agreed to hiring Farley.
In his October 3 column entitled âEt Tu, Toyota?âNew YorkTimes columnist Thomas Friedman expresses his shock and utter dismay that his beloved Toyota is siding with Detroit automakers in what he calls a Michigan-style âassisted suicideâ â- opposing stringent fuel-economy standards proposed by the Senate.
In previous columns, the Pulitzer Prize-winning Friedman advocated Toyota take over General Motors and rule the automotive universe on the basis of its pioneering leadership in fuel-efficiency as expressed through a single model, the Toyota Prius hybrid.
Now, Friedman is disappointed and stunned: Toyota, along with GM, Ford and Chrysler, is opposing the tough mileage standards in the U.S. Senateâs draft version of the energy bill, and are lobbying for another bill that is more stringent and separates cars and trucks.
Toyota wasted no time in responding to Friedman's column. General Motors has as well. And so have other industry watchers, including columnists from Motor Trend and Fortune magazines
Automakers reported weak September vehicle sales against a backdrop of continued
economic headwinds. Still, some automakers -- especially those with new models -- fared better than those without new wares.
General Motors, Nissan and Honda reported gains; Ford, Toyota and Chrysler saw declines. Total industry sales in September ran at a seasonally adjusted rate of 16.23 million units compared with 16.6 million in September last year.
"This month was pretty much in line with what we expected," said Jesse Toprak, executive director of Edmunds.com's industry analysis. "Auto manufacturers that saw the most gains had new or freshened models -- GM with the Cadillac CTS and new crossovers, Honda with the Accord, Nissan with the Altima."
The average automotive manufacturer incentive in the U.S. was $2,293 per vehicle sold in September 2007, down $176, or 7.1 percent, from August 2007, and down $267, or 10.4 percent, from September 2006, according to Edmunds.com's monthly True Cost of Incentives (TCI) report.
"Some may have thought that this soft market would inspire the automakers to increase their incentives to boost sales, but that isnât happening," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com. Edmundsâ report on incentives was released just before automakers began reporting September sales, expected to be soft compared with a year ago.
New vehicle sales in September are expected to be 1.29 million units (retail and fleet), a 4.5 percent decrease from September 2006, according to Edmunds.comâs forecast.
"This month, the automakers with the most momentum are faring well even given the constraints of the marketplace," observed Jesse Toprak, executive director of industry analysis for Edmunds.com. "Especially in a soft market like this, compelling new products and effective marketing campaigns are the keys to success."
Honda, which just launched the Accord accompanied by a significant advertising campaign, is the only one of the six major automakers predicted to show a sales increase, on both an unadjusted and adjusted basis. This September had 25 selling days, one less than September 2006. When adjusted for this difference, sales decreased 0.7 percent from September 2006.
Former Toyota executive Jim Press, now vice chairman and president of Chrysler, told a Detroit radio show host that Chrysler and Detroit automakers in general will regain market share, lost to companies like Toyota.
“I think every 37 or 38 years you ought to try a new career,†Press, who was at Toyota for 37 years, told Paul W. Smith on his WJR-AM radio show in his first interview since joining Chrysler.
"It's great to be back on the home team. It’s great to be on this team," Press said.
Toyota Motor Corp. President Katsuaki Watanabe confirmed Tuesday what had
been reported -â the automaker is considering building a new automobile plant in Japan, its first domestic plant in 17 years.
Watanabe didn't provide details on location or investment. However, last week the Nikkan Kogyo Shimbun said Toyota would invest about Y100 billion to build a plant in northern Japan to start operations as early as 2009.
By Bill Visnic
Toyota Motor Corp. has endured some scoffing over the sometimes unseemly incentives of several thousand dollars consistently laid on the hood of its all-new Tundra full-size pickup. In July, Edmunds.com
estimated Tundra incentives reached a height of $4,625; Toyota execs say they now are at about $3,000.
But at a meeting last week for financial institutions and media, one Toyota executive says so many customers are upside-down, that without big cash incentives, the full-size truck segment is a “No Sale.â€
Jim Lentz, executive vice president, Toyota Motor Sales U.S.A. Inc., rattles off some interesting statistics about Tundra transactions:
The United Auto Workers' contracts with General Motors (which the union selected Thursday as its strike target), Ford and Chrysler officially expires at 11:59 p.m. Friday.
What will happen as the clock strikes midnight?
Exactly nothing. At least as far as the outside world is concerned.
Ford and Chrysler have signed temporary extensions. And even with GM as the lead target and UAWâs local preparing strike posters, the talks likely will continue on past the witching hour and possibly days, if not weeks, thereafter.
NEW YORK –- During a presentation for the U.S. financial community and journalists this week, not one of Toyota Motor Corp.’s Japanese and U.S. executives uttered the phrase, “Global domination.â€
They didn’t have to. They mostly let the numbers –- and the promise of a host of proposed new processes -– do the talking.
Like the Golem-like robot in “The Day the Earth Stood Still,†it’s beginning to look like Toyota can simply raise its helmet visor and ray-beam any obstacle out of existence.
Though Toyota insists lithium-ion batteries preferred for plug-in hybrids are far from ready, General Motors is confident it could have more than one kind of lithium-ion battery ready for its Chevrolet Volt by its year-end 2010 target.
GM has development contracts with suppliers for advanced lithium-ion batteries. It may use batteries from more than one of them for its upcoming Chevrolet Volt and various other models using the Volt’s E-Flex system, including the Opel Flextreme, unveiled Tuesday at the Frankfurt auto show
GM Vice Chairman Bob Lutz told AutoObserver at the show both A123Systems and LG Chem -- battery makers with development contracts with GM but that use different chemistries in their batteries -- are “absolutely confident†they can meet GM’s requirements for the Volt’s battery. GM insists the battery provides 40 miles of pure electric power, charge and recharge 4,000 times, have a 10-year life and is ready for GM’s plan to have the Volt on the road by year-end 2010.
“Everybody feels good about meeting the specifications,†Lutz said. “There’s none of this ‘we hope we can make it.’â€
The New Chrysler announced this morning that Toyota’s Jim Press is joining
Chrysler as vice chairman and president.
Press, a 37-veteran of Toyota, was the first and only non-Japanese to be elected to Toyota's board of directors in Japan. He also was the first American to be named president and chief operating officer of Toyota Motors in North America, making him Toyota's highest-ranking exec in North America.
At Chrysler, Press will be responsible for North American Sales, International Sales, Global Marketing, Product Strategy, and Service and Parts. Marketing is an area of serious weakness for the Detroit automaker.
The stunning news demonstrates that the traditional automotive playbook is out the window when a private equity firm buys an automaker, as Cerberus Capital Management did with Chrysler, a deal consummated only in early August.
It also demonstrates how fast-moving -- and anxious -- private equity firms are in turning around ailing properties in order to earn a return on their investment. Chrysler CEO Bob Nardelli, formerly Home Depot CEO, is leading the charge -- moving quickly and decisively and bringing in fresh blood from outside -- at whatever the cost.
The biggest surprise to jump out of the August vehicle sales reports, issued Tuesday, was that General Motors sales were up, when they had been predicted to be down.
And, not as surprising, Toyota sales slipped for the second month.
Another surprise was the sales strength of crossovers and large trucks, especially crossovers like GM's Buick Enclave, as well as the surge of the Honda Accord.
The average automotive manufacturer incentive in the U.S. was $2,362 per vehicle sold in August 2007, down $159, or 6.3 percent, from July 2007, and up $51, or 2.2 percent, from August 2006, according to estimates issued by Edmunds.com Tuesday.
"It is unusual for incentives spending to fall from month to month this time of year, as manufacturers typically offer generous deals in order to clear old inventory," said Jesse Toprak, executive director of industry analysis for Edmunds.com.
"This year the domestic automakers are staying true to their value pricing strategy and carefully picking and choosing where to offer marketing support, rather than blanketing the whole lineup with incentives," he added.
Not surprisingly, based on the latest dreary economic news, August vehicle sales will be down, according to Edmunds.comâs forecast. Automakers report sales Tuesday.
Industry vehicle sales, including retail and fleet, are expected to be 1.42 million units, a 4.5 percent decrease from August 2006 and an 8.7 percent increase from July 2007. Big Three share is predicted to be below 50 percent for the second consecutive month.
"Early in August, sales were dismal," observed Jesse Toprak, Edmunds' executive directory of Industry Analysis.
"To generate showroom traffic, most automakers introduced incentives programs midway through the month," added Toprak. âThat effort was relatively successful."
Still, noted Toprak, the uncertainty in the housing market is likely to continue suppressing consumer demand for new vehicles for some time.
A group of Kentucky community activists, including labor and church leaders, are gathering outside Toyota's biggest U.S. assembly plant today to deliver recommendations to management, including limits on the use of lower-paid temporary workers, to improve working conditions at the factory, according to the Detroit News.
The appearance by the group, Kentucky Workersâ Rights Board, will be followed by a news conference. The United Auto Workers union is trying to organize foreign-owned plants in the United States to offset the drop in its membership rolls at Big Three plants. Toyota is its prime target, the newspaper reports. However, the UAW has not succeeded in past efforts to organize Japanese-owned plants.
Toyota and Isuzu announced Monday they will work together to develop a system to make diesel engine exhaust cleaner. Isuzu, an expert in diesel technology, will work with Toyotaâs truck partner, Hino Motors on the green diesels.
General Motors may build as many as 60,000 of its Volt electric cars for their
inaugural year on the market, four times the sales of Toyota's Prius hybrid on its U.S. debut, people with knowledge of GM's plans told Bloomberg News
.
Production at that level may allow GM to sell the plug-in Volt for less than $30,000 (the Prius starts at $22,175 with 60,000 a year sold in the U.S.), the sources said.
As the U.S. auto-buying public resigns itself to handing over $3 for a gallon of gasoline or more, automakers are hitting high gear to firm up alternative-power strategies that certainly seemed much fuzzier at this time last year.
It’s come time to decide how to best save fuel, and for the next several years, the battle will be between hybrid-electric vehicles (HEVs) and sophisticated new diesel engines.
Lexus marketing vice president Deborah Wahl Meyer is headed for the top Chrysler marketing post.
Chrysler confirmed today that Meyer is the new vice president and chief marketing officer of Chrysler, effective Aug. 28.
Meyer, 44, is considered a marketing whiz kid; Chrysler needs some marketing magicand some first aid for its damaged dealer relations; new Chrysler owners are bound to sweep some current folks and bring in new troops to achieve its ambitious plan to turn the company around in three years.
Forget about granola-nibbling Californians as the mainstay of electric cars. Gun-toting pickup drivers want âem, too.
AutoObserver’s entry on General Motors’ Chevrolet Volt electric car generated quite the buzz when it was picked up on a forum of a gun-owners’ Web site, billed as the “Home of the Black Rifle.â€
The general consensus of those on the gun-owners' Web site was in favor of electric vehicles -- as long as they have the performance, range, price, etc. of their current vehicles. They want them not for highfalutin reasons like energy independence and energy security or environmental cleanliness but for gas and money savings.
Edmunds.com has revised its True Cost of Incentives (TCI) for the Toyota and specifically the Toyota Tundra.
The Tundraâs TCI was reported to be $6,861 per vehicle sold in July. The correct number is $4,625. The original data suggested that the Tundra had the highest TCI of the large truck segment during July 2007; the corrected data puts the Tundra third in TCI.
After announcing Thursday that it had signed a contract with a little-known
Massachusetts company to develop lithium-ion batteries, General Motors hosted a dinner to introduce the growing team of engineers working on the electric-powered Chevrolet Volt and the newly signed-on battery makers.
David Cole, Ph.D., chairman for the Center of Automotive Research, which hosted the conference at which GM made its announcement, sat next to me. As the discussions with the engineers and, in particular, the battery developers grew deeper throughout the evening, Cole, a retired professor of mechanical engineering at the University of Michigan, could not stop saying: “Wow.â€
By evening’s end, Cole, who’s privy to lots of inside information at all the auto companies and has served on boards of technical companies, said he was now very optimistic about the future prospects for the Volt and subsequent GM electrified vehicles. “This is the game changer†unlike anything he’d seen in his long automotive career, he said.
Indeed, if GM succeeds with electrified vehicles like the Volt, the automaker may well turn the auto industry and nearly every business model within it on its ear –- from the kinds of cars we drive (electric versus gasoline) to the way consumers buy cars.
Cole sees the biggest risk to GM’s venture as something seemingly simple: cheap gas.
On the day that the Wall Street Journal ran a story on Toyota delaying its
advanced hybrids due to potential safety problems with its lithium-ion batteries, General Motors announced it will co-develop lithium-ion batteries with A123Systems Inc., of Watertown, Mass.
The agreement is expected to help speed up GM's electric plug-in vehicles and fuel-cell vehicles using GM's E-Flex architecture, introduced in January on the Chevrolet Volt, possibly ahead of Toyota.
GM Vice Chairman Bob Lutz, speaking at the Center for Automotive Research's annual management conference in Traverse City., Michigan, Thursday, said A123Systems uses nanophosphate battery chemistry that is not only powerful but also safe.
Lutz said the various batteries being developed through contracts GM has signed with suppliers would be ready for testing in October, installed in mule vehicles by year-end and be in demonstration vehicles by next spring. The next phase -- the most challenging phase -- will be to have them in showrooms by the end of 2010.
Jim Lentz, executive vice president for Toyota Motor Sales, discussed the opportunities and challenges of the auto industry during his speech to the Center for Automotive Researchâs annual management meeting in Traverse City, Michigan, Wednesday. After his speech, he elaborated on those topics and others in an exclusive one-on-one interview with AutoObserver.
Are you spending more on incentives than you had anticipated on the Tundra?
Probably a little bit. But I think that’s a result of softness in the market. When we planned this launch, we had expected growth of the total market to be 200,000; instead, the market is 200,000 shy of last year. We also thought there would be growth in full-size trucks. We thought Chevy and Toyota bringing out new models and Ford introducing the Super Duty would stimulate the market. Instead, the segment is down.
What lessons did you learn from Tundra? Was it a tougher sell than you anticipated?
It hasn’t been tougher, but our biggest surprise was in dealing with conquest buyers. We didn’t realize they are really locked into a certain spec level and an exact vehicle.
Jim Lentz, executive vice president of Toyota Motor Sales, predicted a promising long-term future for the U.S. auto industry, with sales reaching 18 million vehicles a year. But along the way, he sees formidable challenges.
Speaking at the Center for Automotive Research’s annual
management seminars in Traverse City, Mich., Lentz said sales this year likely will be 16.3 million vehicles, down about 2 percent from 2006. However, he forecasted a rebound in 2008 with steady growth into the next decade.
The major challenges facing the industry in the meantime, he categorized as politics and powertrains, pleasing new youth buyers and improving the industry’s retail reputation.
Just recently I was up in Hokkaido, Japan’s scenic northern isle, driving the new Nissan Skyline Coupe -- Japan’s version of the highly rated new Infiniti G37 Coupe. Through the twists and turns of Nissan’s Hokkaido proving grounds, in bright summer sunshine, the V6 Skyline coupe was a total blast, and looked that way, too.
Then, at dinner, came the wake-up call. "Please write great things about car," urged one of the Nissan marketing execs, "and about cars in general, if the Japanese car market is going to survive into the future." Or words to that effect.
Que? This wasn’t the usual rosy, end-of-drive send-off for the press but something very different. Clearly some kind of warning and a pretty serious one at that.
Alarm bells, in fact, are now ringing throughout the Japanese car industry, because car sales at home continue to decline and the long-term future of the domestic industry is suddenly looking not a little uncertain. Yes, really.
Gembutsu. Translated from Japanese it means âgo and see.â For Toyota, it is
the part of the product development process during which Toyota designers and engineers go to their customers to see how they use their Toyotas.
With the new full-size Tundra pickup truck, Toyota product developers went
beyond gembutsu, adding âdoâ to âgo and see,â Michael OâBrien, Toyota corporate manager of product planning told attendees of a seminar on designing vehicles for customization at the Center for Automotive Research Management Briefing Seminars being held this week in Traverse City, Michigan.
Two-week, 1,000-mile long trips took Toyota engineers and designers from Japan and the U.S. to ranches, farms, mines, construction sites, recreational vehicle areas and snowplow factories to experience the kinds of equipment they add to their Toyotas when or after they buy them.
“We were often served coffee by big-haired waitresses who called us ‘hon,’†O’Brien quipped.
The profit-per-vehicle gap between the American Big Three and the Japanese Big Three automakers soared 32 percent between 2005 and 2006 to $3,814, according to a new report.
The results of the report, done by financial firm Stout Risius Ross and its managing director, Laurie Harbour-Felax, were revealed at the Center for Automotive Research Management Briefing Seminars being held this week in Traverse City, Michigan.
Reasons for the widening cap are a lack of commonizing parts and platforms as well as lower sales and market share of the domestic brands. Of the Big Three, GM made the most improvement.
Toyota reported first-quarter profits significantly higher than what analysts forecasted, thanks as a weaker yen that increased revenue from sales of the Corolla and Camry outside of Japan.
And here’s an interesting tidbit from Bloomberg News: Toyota is valued at $214 billion (U.S.), more than 11 times more than General Motors. Toyota is poised to surpass GM as the world’s largest automaker this year.
Kudos to Bloomberg News for reporting what many of us covering the auto
industry noticed but hadnât written -â and shame on us for not doing so: Toyota's recently announced plug-in hybrid
has far less range than does General Motorsâ Chevrolet Volt
concept -â as little as half the range, in fact.
GM intends for the Volt to travel at least 40 miles after being charged; Toyota’s model may go no more than 20 miles on a single charge and possibly as little as 10 miles, Bloomberg reports, quoting sources familiar with the vehicles.
Interestingly, Bloomberg also quotes an unlikely source of praise for GM: Chris Paine, whose 2006 documentary, Who Killed the Electric Car? criticized GM’s decision to drop and destroy the EV-1.
July wasnât kind to any automaker with Toyota registering its first sales decline in almost three years. But Detroit automakers made history: their combined market share of the U.S. vehicle market fell below 50 percent for the first time ever.
The combined market share for Chrysler, Ford and General Motors stood at 49.7 percent in July, according to Edmunds.comâs calculations. It was only the mid-1980s that their combined share was nearly 75 percent.
"It's probably a turning point for people who look at the record books. Domestics on their home turf are being beaten by the foreign automakers in terms of their market share," said Jesse Toprak, Edmunds.com's executive director of Industry Analysis.
Summer 2007 is turning out to be rather unusual compared to summers of the recent past, and it is showing up in sales.
This summer, no big blowout, model-year-end incentives are being offered -- yet -- to consumers to clean up leftover inventories. In recent years, General Motors has led the parade with big campaigns that have forced others to follow, But throughout this year, GM has tempered its incentives.
As a result, in part, July new vehicle sales, to be announced next week, are expected to be down for the industry, according to Edmunds.com's forecast.
Toyota announced in Japan today that it has developed a plug-in hybrid that it will test on public roads in Japan, Europe and the U.S.
Like other Toyota hybrids, the Toyota Plug-in HV uses a gasoline internal combustion engine, an electric motor and a nickel-metal hydride battery â- not the advanced lithium-ion batteries currently under development.
The five-passenger Toyota Plug-in HV, like the Chevrolet Volt concept unveiled by General Motors at this yearâs Detroit auto show, uses increased battery capacity to allow longer electric-motor-only cruising mode and a battery-charging device that replenishes the batteries using household electricity. That enables the car to run more often in gasoline-free, electric-only mode, such as on short trips in city driving.
Toyota announced it has dropped the price of its 2008 Camry Hybrid by $1,000
to $25,860, apparently to boost sales in an intensifying midsize car market with a growing number of hybrids in the category.
Toyota’s move on the Camry Hybrid echoes a similar one on the Prius in April. But there's a big difference between the two.
Toyota achieved the Camry Hybrid markdown through removing standard equipment from the base model to lower the base MSRP; it accomplished the Prius’ price reduction by lowering option prices, not dropping equipment, noted Alex Rosten, Edmunds.com’s manager of pricing and market analysis.
Japanâs major car companies have halted vehicle production because of earthquake damage to a key supplierâs plant.
Honda, Mitsubishi, Nissan and Toyota stopped production due to damage to Riken, a piston ring and seal manufacturer. The automakers use just-in-time delivery so assembly plants maintain very few parts in stock.
Experts say the temporary production halt will have little impact overall for the year since the automakers can make up the production in the usually slow month of August.
General Motors moved in front of Toyota in global sales in the second quarter, but Toyota, which beat out GM in the first quarter, retained the lead for the first half of the year.
This could be the year Toyota overtakes GM in global sales and production for the year. GM has been No. 1 in both for 76 years.
Toyota said second-quarter global sales totaled 2.37 million vehicles; GMâs global sales hit 2.41 million, lifted by strong sales in Latin America, Asia and emerging markets. In the first quarter, Toyota sold 2.35 million vehicles to GMâs 2.27 million.
That put six-month sales totals at 4.72 million for Toyota and 4.67 million for GM.
It’s still the best part of two years away. Nevertheless, the world is already
watching and waiting on the next Toyota Prius
.
Behind firmly closed doors in Toyota City, Japan, Toyota engineers and designers are now working on exactly this vehicle. What will it look like? How will it be engineered? How will it move the sector to enable Toyota to reach its goal of selling 1 million hybrids per year by the early 2010s?
Toyota’s reported vision is for: · a new, third-generation Prius, slightly bigger than today’s model for debut in 2009; · a trio of versions, including one smaller than the Corolla and one larger than the current Prius that resembles the Hybrid X concept shown at March’s Geneva Auto Salon; · traditional nickel-metal hydride batteries, not lithium-ion ones; · further progress in the Prius becoming leaner, meaner, greener and cheaper.
One thing is for sure: The current Prius is a standard setter and global superstar. Its successor in will have a lot to live up to.
Toyota’s top North American official reaffirmed the Japanese automaker’s
commitment to hybrids and predicted hybrids will eventually dominate U.S. roads as fuel prices continue to rise.
"Eventually, everything will be a hybrid," said Jim Press, president of Toyota Motor North America, told Bloomberg News in an interview Tuesday.
New vehicles sales for June (retail and fleet) are expected to be 1.55 million units, a 3.4 percent increase from June 2006, according to Edmunds.com. Automakers will announce sales on Tuesday.
âIn order to understand the year-over-year comparisons of sales for each automaker this month, one must remember that last June was one of the best sales months of the year for some automakers, and was particularly disappointing for others,â observed Jesse Toprak, Edmunds.comâs executive director of Industry Analysis.
âThis month, automakers seem to have achieved sales at more typical and sustainable levels rather than the dramatic highs and lows of last June,â he added.
Perfunctory yet historic, Toyota Motor Corp. appointed American Jim Press, the first non-Japanese person, to its board of directors.
Toyota had announced the appointment months ago but shareholders made it official yesterday at the company’s annual meeting in Japan.
The appointment comes as Toyota overtakes General Motors in global sales, its Toyota Division surpasses Ford as the No. 2-selling nameplate in the U.S. last month, and sales and market share are growing at the expense of U.S. makers.
Union work rules and job classifications at Detroit automakers have resulted in 8,200 assembly jobs that wouldn't be needed if the automakers had the flexibility of Toyotaâs U.S. factories, according to study by Detroit turnaround expert, AlixPartners.
"Our analysis of the cost differential between the domestic automakers and Toyota just due to work rules and job classifications further points up just how important this year's labor negotiations are to the Detroit Three," John Hoffecker, managing director of AlixPartners, said in a statement, published in today's Detroit Free Press.
The study also confirms why private equity firms are so interested in auto companies and parts-making companies: they are getting bargains.
Still trying to gain some traction with its new pickup truck, Toyota is offering customers nationwide a
cash rebate of up to $3,000 or zero-interest financing for 60 months on the 2007 Tundra
.
Buyers of the regular cab model receive a $3,000 rebate; buyers of the CrewMax and Double Cab get $2,000. The zero interest financing is available on all models. The incentives expire July 9. In the Los Angeles, where Tundra sales lag those of northern California, the cash rebates are $3,000 for all models through July 31. Special lease rates are also available. A bonus to salespeople in L.A. on Tundras is also in effect through July 2.
Introduced in February, the Tundra has had a tougher go of it than some, including perhaps Toyota, anticipated. The loyalty rates among domestic truck buyers have remained strong, and the full-size pickup truck, in general, has been soft and is expected to continue to be cold throughout the summer, according to Edmunds.com's analysis of consumer purchase intent.
Toyota said Friday it is in talks with Japanese partner truckmaker Isuzu on developing diesel engines, Japanâs business daily Nikkei reports.
Toyota would outsource diesel engine production to Isuzu, famous for its diesel technology. The 200,000-a-year diesel engines would go into Toyota small cars in Europe, the newspaper says.
Toyota owns 5.9 percent of Isuzu. Isuzu formed a capital alliance with Toyota in November after dissolving its tie-up with General Motors in April 2006. Isuzu still supplies diesel engines to GM for its large trucks.
The Toyota-Isuzu deal is yet another indication of increasing interest by Japanese automakers in diesels. Earlier this week, Nikkei reported Honda plans to sell diesel vehicles in the U.S. and Japan by 2009.
Honda plans to sell diesel vehicles in Japan by 2009, the Nikkei business daily reports today. Honda earlier said it could introduce a diesel in the U.S. the same year.
Last year, Honda said it had developed a new and simple diesel as clean as gasoline cars. The engine could be on a car in the U.S. by 2009, Honda said at the time. Nikkei reports the new diesels, development of which Honda has been speeding up, would first go on the compact CR-V sport-utility and Accord sedan.
Hondaâs potential sale of diesels in Japan and the U.S. suggests a shift in strategy by some Japanese automakers.
Small cars are hot and getting hotter this summer. Big trucks as well as large, midsize and luxury SUVs are not. And the Buick Enclave looks like another winner for General Motors, according to Edmunds.com's analysis of consumer intent.
Consumer intent is determined by what vehicles consumers are shopping for right now on Edmunds.com and what they likely will buy in the next 30 to 90 days. That demand -â or lack thereof -â has a direct correlation to prices and incentives.
For consumers in the market for small cars, buy now because the prices wonât be better and might even go higher. For large truck and SUV shoppers, hold off; bigger incentives are on the way, says Edmunds.com CEO Jeremy Anwyl yesterday in a presentation to the Society of Automotive Analysts.
Hereâs a rundown by category and individual models of whatâs hot and unlikely to see higher incentives or increased discounting so now is as good time to buy as any. Also following is a listing of what categories and individuals aren't so hot, indicating buyers should hold off their purchases for richer incentives and deeper discounting:
Ford Motor Co. managed something of an upset Wednesday as J.D. Power & Associates released the results of its closely watched Initial Quality Study (IQS) of 2007 models. Neal Oddes, J.D. Powerâs director of product research and analysis, said the results of the quality survey contained very good news for Ford.
âFourteen Ford Motor Company models placed in the top three of their respective segments â an achievement unmatched by any other corporation this year â which is a testament to the improvement in quality for Ford Motor Company vehicle models and plants. In addition, their Lincoln nameplate, which receives two segment awards, improves considerably to rank 3rd in 2007, from 12th in 2006,â Oddes said.
As has been the case for years, automotive suppliers like doing business with Toyota and Honda but their relationships with General Motors are improving, according to a new report.
Toyota ranked first, followed by Honda, Nissan, Chrysler, GM and Ford, respectively, in their relationships with suppliers, according to the study by Planning Perspectives Inc., a consulting firm in Birmingham, Michigan, released today.
GM wins for most improved. It had the most dramatic year-over-year increase in the 15 years of the study, said company President and Chief Executive John W. Henke, Jr. GM has held last place for the past 15 years; now it ranks second to last above Ford. Henke credits the improvement with a program instituted by GM in 2005 to enhance supplier relations.
For only the fifth time in history, Toyota surpassed Ford in monthly sales last month. In May, Toyota outsold Ford 10,870 vehicles, according to Edmunds.com's analysis.
Toyota outsold Ford for the first time in July 2006, beat Ford again in November 2006 (by the widest margin of any month), December 2006 and January 2007.
Month/year Toyota's Margin of Vehicle Sales over Ford July 2006 5,473 November 2006 20,544 December 2006 3,552 January 2007 14,605 May 2007 10,870
My son and I were piling into the Volkswagen Rabbit test car in
front of the 7-Eleven, loaded up with our favorite after-school snacks â frozen Cokes, Twinkies and Cheetos â when my teen noticed the woman passing in front of our car with two small children in tow.
“That’s a yoga mom,†he said matter-of-factly. I’d never heard the term before, but it rolled off his tongue as if it were an everyday label. And I knew what he meant.
Edmunds.com estimated today that the average automotive manufacturer incentive in the U.S. was $2,497 per vehicle sold in May 2007, up $44, or 1.8 percent, from April 2007, and up $123, or 5.18 percent, from May 2006. Honda, in fact, hit a record for incentives.
"The summer incentives hike has started," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com. In previous months, we have seen year-over-year declines in incentives spending, but this month the trend reversed."
As the summer wears on, incentives will grow even bigger, Toprak predicts.
Toyota has been careful about boasting its No. 1 in global sales status while, at the same time, U.S. automakers close plants and cut jobs. Toyota executives, in fact, have downplayed the Japanese automakerâs sales outlook in North America, saying sales will slow.
But analysts and investors donât buy it, according to a report today by Bloomberg News. They suspect Toyota is being cautious for fear of a political backlash.
They agree Toyota can't match last year's 15 percent sales growth, but most say Toyota is being too modest. "Toyota's sales growth forecast in North America seems too conservative,'' Koji Endo, a senior analyst at Credit Suisse Group in Tokyo, told Bloomberg. "Its outlook sales figure seems to be political.''
New vehicle sales, including both retail and fleet sales, are expected to be 1.48 million units when May sales figures are announced next Friday. Thatâs down from last May, according to Edmunds.com.
This May had 26 selling days, one more than May 2006. When adjusted for this difference, sales decreased 4.2 percent from May 2006. On an unadjusted basis, sales this May are down 0.3 percent.
"As gas prices climb, many consumers are taking a conservative approach to car buying. Additionally, numbers are down because domestics continue to cut production, reducing fleet sales and better matching supply with retail demand. However, these factors are not causing sales to fall as dramatically as one might expect," said Jesse Toprak, executive director of Industry Analysis for Edmunds.com.
India is predicted to be the fastest-growing auto manufacturing nation in the next few years, according to a forecast by New York-based PricewaterhouseCoopers. The firm predicts between 2006 and 2011, India â- not China -â will be the fastest-growing auto manufacturer among the worldâs top 20 carmaking countries.
"Everyone is looking at India after what happened in China,'' Ashvin Chotai, who works in London as director of Asian automotive research for Global Insight, told Bloomberg News. "There's no other place that even comes close.''
In the year ending March 31, Indiaâs passenger car sales increased 21 percent to 1.38 million. By 2015, they're expected to more than double, according to the Society of Indian Automobile Manufacturers.
New York City Mayor Michael Bloomberg announced on NBCâs Today
show Tuesday that the cityâs cab fleet will go entirely hybrid within five years, and all of its vehicles for hire must meet new emissions and mileage standards by next year.
New York now has just 375 hybrids among its 13,000 taxis. That number will increase to 1,000 by October 2008 and will grow by about 20 percent each year until 2012, when every cab is a hybrid, the Associated Press reported. The shift to hybrids is part of Bloomberg’s sustainability plan for the city that includes a 30 percent reduction in carbon emissions by 2030.
Ford has a lot at stake in the New York cab business with the large, fuel-guzzling Ford Crown Victoria being the cabbie’s favorite ride, and having the most hybrids in New York's taxi fleet.
Ford was quick to jump on Bloomberg’s announcement, sending out a press release on the virtues of its Ford Escape Hybrid, including its average 36 miles per gallon compared with the 14 miles per gallon of the Crown Vic.
Toyota may be No. 1 in global sales, but it can’t even win in NASCAR’s Nextel Cup Series.
Toyota exuberantly became the first foreign brand to compete NASCAR since the 1950s. It was thought with Toyota’s “open wallet†the Japanese automaker would “buy its way into victory lane,†writes The New York Times today.
But that hasn’t happened 11 races into the 36-race season. None of Toyota’s contingent of seven drivers on three teams locked into the top 35 in points and thus guaranteed a starting spot in the 43-car field each week. "Toyota cannot even buy its way into a race,†writes The New York Times.
Much ado was made last month when Toyota surpassed General Motors as No. 1 in global sales for the first time.
Now a story in todayâs New York Times business section suggests leapfrogging from 2nd place to 1st may have substantial and quantifiable benefits on revenue.
Jan H. Hofmeyr, an expert on consumer behavior at Synovate, the market research arm of Aegis, conducted a study of brand preferences and spending habits of consumers. The study demonstrated the relative benefits of moving up in the rankings. A product that leaps from 2nd to 1st in a category can really affect a companyâs bottom line, Hofmeyr concluded, while the advantage of moving up to, say, No. 5 from No. 6 is much smaller.
âMarketers have always known itâs better to be No. 1 than No. 2, but now you can attach a revenue consequence to that,â Hofmeyr told The New York Times.
The automotive industry was a tough place to make a buck this
past year -â except for Toyota.
Most of the world’s major automakers struggled in 2006, with about half of them reporting lower profits. But Toyota reported record profits Wednesday.
Toyota's net income rose 20 percent to the equivalent of $14 billion (U.S.) for the fiscal year that ended March 31. Toyota's revenues rose 14 percent to a record $204 billion. Global vehicle sales for the year totaled 8.52 million units, an increase of 550,000 compared with the previous fiscal year and also a record.
For the first time in history, Toyota surpassed General Motors, which set a record itself, in global vehicles sales during the first quarter of 2007. Experts predict Toyota is poised to surpass GM as the No. 1 automaker in sales as early as this calendar year.
The new Toyota Tundra is beginning to chip away at the loyalty of
domestic truck owners.
Buyers of domestic full-size trucks, the most brand loyal in the industry, are starting to consider Toyota’s new Tundra, considered the Japanese automaker’s first credible contender against the Chevrolet, Ford and Dodge pickups.
“Now that Toyota has its full lineup of trucks available with all powertrains, domestic buyers are beginning to take notice,†said Alex Rosten, Edmunds.com’s manager of pricing and market analysis.
Edmunds.com’s analysis of truck loyalty figures, based on April sales, shows that since the new Tundra went on sale in February:
· Tundra’s share of domestic truck trades increased 5 percentage points, from 29.4 percent to 34.4 percent;
· large truck trade-ins from all brands for a Tundra increased 16.5 points from March to April, returning to February’s high level of 57 percent;
· Tundra’s conquest of all trucks, not just full-size pickups, from other manufacturers rose 5.6 points.
At the same time, loyalty rates for all other trucks but one declined in April. Only Dodge Ram improved its overall conquest rate.
This week, General Motors allowed the first test-drives of its 2008
Chevrolet Tahoe and GMC Yukon two-mode hybrids that go on sale later this year.
That drive was significant beyond the vehicles themselves.
The SUVs are the fruits of an unprecedented venture, also involving DaimlerChrysler and BMW, to take hybrid technology to the next level. And they are only the first fruits. A host of vehicles from GM, DaimlerChrysler and BMW are scheduled to roll out over the coming years.
These kinds of ventures are required to find the technological solutions to reduce or even eliminate environmentally destructive emissions and reduce or even eliminate the world’s dependence on petroleum for fuel. And ultimately save the planet.
April brought a deluge of bad news in terms of lower vehicle sales for automakers. Could flowers be far behind the showers?
Maybe not for the automakers, but certainly for consumers. They took a wait-and-see attitude in the incentive-sparse month of April. Their wait may prove worthwhile. Automakers are likely to launch a new crop of incentives, some of which have already sprouted, to spur sales and keep vehicle inventories in check.
âBased on last month's sales, I would almost guarantee that incentives will be up significantly this month,â said Alex Rosten, Edmunds.comâs manager of pricing and industry analysis.
Some automakers already have launched new incentives.
Toyota has plastered billboards all over the German landscape in what a publication
there reports is the largest billboard campaign in the countryâs history -- by a long shot.
To introduce the Auris compact wagon in Europe, Toyota has purchased every available billboard in 82 of the largest cities in Germany for 10 days straight. That’s 202,000 billboards -– about half of the country’s 400,000 available billboards, the German advertising association (ZAW) estimates.
A ZAW official said no such campaign had ever been done on this scale before. An industry expert estimated Toyota’s cost at up to 30 million Euro, though the Japanese automaker likely received substantial rebates for such a high-volume ad buy.
The last big billboard campaign in Germany was a Volkswagen product launch that used 90,000 billboards at a cost of 12 million Euro.
It’s been an eventful month for Jim Press, president of Toyota Motor North America.
Earlier this month, Press was named the first non-Japanese to the Toyota Motor Corp. board in Tokyo; about a year ago he became the first American to head Toyota Motor North America. And then, just this week, Toyota surpassed General Motors for the first time in history in global car sales; a move long expected but not clear when it would happen.
In an exclusive one-on-one interview with AutoObserver Thursday, Press shrugged off both events as not terribly significant.
Toyota’s No. 1 spot, he says, is not a milestone or accomplishment; rather it is the result, he claims, of doing what Toyota does: building quality, reliable cars with good value and taking care of customers.
He calls his role as the first non-Japanese on Toyota’s board an evolution and inevitable as the carmaker grows as a global company with the bulk of its sales outside of Japan. He sees his role as a conduit for communications between Toyota in North America and back to Japan and from Japan back to North America.
He adroitly responds to critics who charge the now No. 1 Toyota faces challenges as it grows, such as risking becoming complacent or even arrogant, stretching its lean human resources beyond their limits and missing promising opportunities due to its leanness.
As for the future of Toyota in the global auto industry, he predicts in another 10 years, only about a half-dozen major auto companies will exist –- and Toyota will be among them. And future drivers will be tooling around in plug-in hybrids of all kinds.
Here’s a transcript of Press’ exchange with AutoObserver:
We’re recovering from the shell shock of Toyota dropping
the bomb that it had surpassed GM as No. 1 in global sales in the first quarter â- news the industry had expected. It was a matter of not if but when.
“This was not an unexpected turn of events,†said Edmunds.com Senior Analyst Jesse Toprak, “but it happened a bit earlier than forecasted.â€
And, as I told NBC’s Detroit affiliate Tuesday, it’s also not the end of the world. While certainly not a positive trend -– no one likes being No. 2 when they’ve been No. 1 for more than seven decades -– GM’s dethroning could have a silver lining. The pressure is off to maintain the No. 1 sales spot, while allowing GM to focus on the more important race -– the one for profitability.
As a Detroit marketing professor told a local reporter: “[GM is] no longer the New York Yankees. They can be the pursuer rather than the pursued.â€
At the same time, Toyota will don the bull’s eye of the press and public, while it struggles to ensure quality, control costs and maintain profit margins during its rapid growth.
Toyota became the worldâs No. 1 car company for sales for the first three months of this year. Toyota surpassed General Motors, the world leader for 76 years, for the first time.
While the figures announced today represent only quarterly sales results, they may well foreshadow the inevitable: Toyota will become No. 1 as early as this year.
Toyota has claimed that surpassing GM is not its goal, Toyota president Katsuaki Watanabe told reporters in December. “It will only be a result of what we've been doing,'' he said.
But don’t believe for a second Toyota’s goal -- or Watanabe's goal -- isn’t to surpass GM. Toyota desperately wants to be No. 1. Watanabe -- described as sharp, very aggressive and even a bit arrogant -- wants Toyota to be No. 1. The automaker just worries about what goes along with being No. 1.
A page 1 story in the Detroit Free Press hailed Santa Monica, California, as leading the way in shifting the transportation paradigm away from petroleum to other fuels.
The article, entitled âCalifornia city leads in taking foot off the gas,â discusses efforts by Santa Monica, home of Edmunds.com, to convert its gasoline-powered vehicles to alternative fuels a move that started in 1994.
About 81 percent of the cityâs fleet runs on something other than petroleum today. Santa Monica uses an array of vehicles and fuels, from street sweepers running on natural gas to 24 fully electric Toyotas. The city is installing electric chargers in public parks and parking garages to encourage more electric vehicles. The city's goal is to make its entire fleet petroleum-free and be the first in the nation to draw all its electricity from the sun or wind in the next 20 years.
"Santa Monica is leading the way. It's changing the transportation paradigm on what can be done, what is possible," Chelsea Sexton, an electric car and alternative-fuel advocate and former General Motors employee who worked on GM's first electric car program, told the newspaper.
The conference's official theme is "Engineering for Global Sustainable Mobility -- It's Up to Us.â The buzz surely will focus on engines and transmissions, specifically reducing emissions and boosting fuel economy, as well as advancing alternative propulsion systems and alternative fuels.
Toyota's entry into the domestically loyal NASCAR circuit has been marred, not only by the poor performance on the track but also by the bad behavior of its driver-partner, Michael Waltrip.
Waltrip's latest shenanigans involve him flipping a Toyota Land Cruiser Saturday morning near his North Carolina home. He faces charges of reckless driving and failing to report an accident when he goes to court May 14.
As expected, Toyota announced today that American Jim Press will become the first non-Japanese to serve on Toyota Motor Corp.âs board of directors. He is expected to be based in Japan.
Press will be promoted to senior managing director at the parent company in June. He now is a managing officer of the Japanese company and president of Toyota Motor North America Inc. in New York.
Last month, vehicle manufacturers launched a host of new incentives on their full-size pickup trucks in
response to Toyota introducing its new Tundra to the market and immediately promoting it with dealer incentives.
March full-size truck sales overall declined from a year ago, prompting truckmakers to try to not only hold onto their loyal owners but steal potential buyers from their competitors. Edmunds’ AutoObserver.com’s analysis of March sales figures showed some incentives succeeded in conquesting buyers; others did not. Here’s a snapshot of what worked and what didn’t:
· Toyota’s incentives of dealer cash paired with low-interest loans on the Tundra didn’t move the needle much in either direction in terms of conquest sales.
· General Motor’s incentives on its recently redesigned Chevrolet Silverado and GMC Sierra combined a relatively small cash bonus with low-interest financing. The incentives helped attract non-GM buyers to its fold.
The Union of Concerned Scientists released its latest report on the environmental performance of the worldâs eight largest automakers this week based in 2005 model-year vehicles.
The group assigned each automaker a global warming and a smog score for its performance in limiting emissions of greenhouse gases -- blamed for global warming -- and smog-producing pollutants.
Honda took 1st place for the fourth consecutive report, followed closely by Toyota. Volkswagen was 3rd in its global warming score but near the bottom for smog production. Hyundai-Kia ranked 4th in both categories. Nissan was 3rd in the smog score.
Detroitâs Big Three ranked last. Fordâs smog rating was better than Volkswagenâs. DaimlerChrysler was the worst in both categories.
Toyota announced to its dealers Tuesday significantly lower prices for select equipment on Prius hybrid
models, Edmunds.com's AutoObserver has learned. The price reductions, which went into effect immediately, range from $600 to $2,000, in equipment packages, some of which have been slashed by half.
The price reductions come on the heels of the Prius posting its all-time, best-ever monthly sales record in March, breaking the previous record set in February. Prius sales in March totaled 19,156, an increase of 133.2 percent over March 2006.
Toyota had some incentives on Prius models in March this year for the first time. Earlier, buyers were put on waiting lists for months before they received theirs. The new price reductions apparently are to replace the incentives but, instead of incentives, which have an expiration date, are permanent.
In addition, the federal tax rebate on the Prius of $1,575 dropped to $788 on April 1.
Even before the latest price reductions, the price consumers were paying for the Prius was dropping. Edmunds.com’s analysis calculated the Prius’ True Market Value at $21,296 in March, down from $3,284 in December.
Japan's vehicle sales fell for a 21st straight month, led by Nissan and Toyota. Japanese automakers selling in their home market have been experiencing their business year since 1977.
What does this mean for the U.S.? The pressure will be on Japanese automakers to maintain and boost sales in the U.S. to offset slow sales in their home market.
Sales of cars, trucks and buses, excluding minicars, fell 12.6 percent to 487,738 vehicles in March from a year earlier, the Japan Automobile Dealers Association reported Monday. Nissan's sales fell 16 percent; Toyota's dropped 12 percent. Car sales have dropped despite increased household spending. The only bright spot in Japanâs auto sales is minicars.
Automakers begin reporting March sales figures on Tuesday, and, based on those numbers, new incentives could be announced on slow-selling models shortly thereafter.
Edmunds.com forecasts new vehicle sales (including fleet sales) in March to come in at around 1.48 million units, a 3 percent decrease from March 2006, which was last yearâs biggest month. Despite the decrease this year, March still could be one of 2007âs best months. And the industry, according to Edmunds.com, is still on track for annual sales volumes of approximately 16.5 million vehicles, along the lines of what we saw in 2006.
The compact-car segment is predicted to be the industryâs hottest for the month.
Chrysler, Ford and General Motors are expected to post declines, putting their combined market share lower than last month or year-ago levels. Toyota and Nissan are predicted to report sales increases. Chrysler will report its sales on Tuesday instead of Wednesday, likely to coincide with the DaimlerChrysler annual meeting in Berlin.
The Union Auto Workers (UAW) will host a meeting of Toyota factory workers Saturday in Lexington, Ky., as a step in trying to unionize Toyotaâs oldest and biggest U.S. plant.
The union says the meeting will be a town hall forum to air their grievances and to provide âan opportunity for Toyota workers to share with the community the human cost of Toyota's success," said a union official.
The UAW is desperate to maintain its shrinking ranks, but has been unsuccessful in organizing Asian-owned factories.
Toyota has added dealer incentives on some versions of its newly launched Tundra full-size pickup truck in an effort to stir slow sales, Edmunds.comâs AutoObserver has learned.
âToyota apparently is coming up short on sales numbers and wants to drive volume,â said Alex Rosten, manager of pricing and market analysis for Edmunds.comâs AutoObserver. âThis is not a good sign for Toyota.
Tundra incentives are: 3.9 percent to 5.9 percent financing on all models, depending on the loan term; special lease rates on all models; $1,000 trade-in assistance for early termination of leases on the previous-generation Tundra; $2,000 dealer cash incentive on Regular Cab models; $1,000 dealer cash incentive on Double Cab models. The incentives run through the end of April. Some dealers already were offering as much as a $1,500 discount on the basic Tundra work truck, which is selling particularly slowly.
The good news is: March may be one of the best months of 2007.
The bad news: March sales will be lower than last year and still be one of the best months this year, suggesting little for the industry to look forward to for the rest of the year.
This month's new vehicle sales (including fleet sales) are expected to be 1.48 million units, a 3.0-percent decrease from March 2006, according to Edmunds.com. Though sales are lower this March than last, Jesse Toprak, executive director of Industry Analysis for Edmunds.com, notes more cars were sold in March last year than any other month of last year. He predicts that this March may be one of the best months of 2007.
"This month, the industry faced debilitating winter storms, less compelling marketing messages and reduced fleet sales, so it is no surprise that year-over-year comparisons reflect a relative downturn," said Toprak. âNevertheless, I believe we are still on track for annual sales volumes of approximately 16.5 million vehicles, along the lines of what we saw in 2006."
Typically, the summer has been the strongest period for new-car sales. This may be shifting because new-model introductions come earlier in the year than they used to, possibly sparking traffic to showrooms during historically quieter months.
The National Highway Traffic Safety Administration (NHTSA) has released its frontal-impact crash test ratings for the 2007 Toyota Tundra and 2007 Chevrolet Silverado full-size pickup trucks.
The score is Chevrolet Silverado -- five stars; Toyota Tundra -- four stars.
NHTSA tested the Regular and Double Cab versions of the Tundra; both achieved four stars.
NHTSA tested Regular and Extended Cab versions of the Silverado. It scored five out of five stars. (It can be assumed that the virtually identical GMC Sierra also rates five stars.)
The Silverado matches the same five-star scores previously earned by the current Ford F-150 and Dodge Ram 1500 pickups for driver and front-passenger safety in a frontal impact.
Toyota has boasted the Tundra goes head-to-head with Big Three pickups on payload and towing capacities as well as safety. It had expected five-star scores.
Four out of five stars represents an 11% to 20% chance of serious injury. A five-star rating indicates serious injury is reduced to 10% or less in a frontal crash.
The full-size pickup truck war ratcheted up yet another
notch this week with General Motors putting incentives on its newly introduced Chevrolet Silverado and GMC Sierra.
The GM truck incentives come on the heels of Toyota dealers putting spiffs on the Tundra, Ford launching a new ad campaign for the F-150 starring Dirty Jobs Mike Rowe, and Dodge increasing its advertising on the Dodge Ram.
GM is offering $1,000 cash bonus and zero-interest financing up to 36 months on all of its trucks. Previously, GM was offering $1,000 in trade assistance and financing of 4.9 to 7.9 percent depending on the term length.
Top auto executives from General Motors, Ford, DaimlerChrysler and Toyota go to Washington, D.C. tomorrow to testify on proposed higher fuel-economy standards.
GM CEO Rick Wagoner, Ford CEO Alan Mulally, Chrysler CEO Tom LaSorda and Toyota Motor Sales President Jim Press are scheduled to appear before the House Energy and Commerce subcommittee on energy and air quality.
A number of proposals to address global warming through increased fuel-economy standards and stricter emissions regulations are on the table. Predictably, the automakers will argue tomorrow that any of them will cost their industry billions of dollars.
Average transaction prices of most hybrids are at historical lows, incentives are being offered on many popular models, certain hybrid tax credits will be lower soon, and gas prices are rising.
Toyota launched the Tundra pickup truck only last month, and so far, based on Edmunds.comâs analysis, it is drawing sales largely from Toyota loyalists rather than stealing sales from General Motors, Ford, Chrysler and Nissan.
Based on February sales data, Edmunds.com puts Toyotaâs loyalty rate on the Tundra -- calculated based on what make vehicle was traded in for the Tundra -- at 50 percent, up dramatically from 38.3 percent the month before. That indicates Toyota owners are trading their current Toyotas -- Tundras, largely -- for the new Tundra.
The Wall Street Journal and The Nikkei, a Japanese business newspaper, report today that Toyota, hungry for additional North American
manufacturing capacity, picked Tupelo, Miss., as the site for its eighth assembly plant. Mississippiâs governor is expected to make the announcement today.
The Wall Street Journal further reported Toyota’s top management has adjusted its plans for the plant, which has been in the works for some time, because of growing concern about the health of the U.S. auto market. The plant has been scaled back in terms of capacity to 150,000 units a year, down from 200,000, and start of production is pushed back from 2009 to 2010. It is expected to produce the next-generation Toyota Highlander crossover, the latest version of which was unveiled at the recent Chicago auto show (pictured).
Toyota also is trying to better balance its imports versus domestically produced vehicles. Two-thirds of Toyota’s sales had been North American built but imports rose to 54 percent last year. Toyota and the Japanese government constantly fret about political repercussions from too many imports and Toyota’s continued success at the expense of U.S. automakers.
Mississippi -- and the birthplace of rock 'n roller Elvis Presley -- apparently beat sites in Tennessee and Arkansas.
according to shopping metrics provided by Edmunds.com.
Toyota unveiled its new Entune multimedia system today at the Consumer Electronics Show (CES) in Las Vegas. Toyota's Entune launch is one of several major automotive tech premiers expected at CES this year; Chrysler and Hyundai also plan to announce new entertainment platforms. 
vehicles in late 2011, before moving through the lineup in 2012. Most attractive is the lack of monthly fees, as the Entune service will be provided for three years with each new Toyota.
to cover crashes they blame on sudden acceleration, the 
The findings, reached in the initial phase of a study conducted by the National Highway Traffic Safety Administration, showed that in 58 accidents attributed to unintended acceleration, in more than half, 35, the brakes were not applied. 
At the Center for Automotive Research Management Briefing Seminars in Michigan, Justin Ward, Toyota Motor Engineering and Manufacturing North America Inc.'s advanced powertrain program manager said Toyota's first plug-in hybrid - just now starting with a 150-vehicle test fleet in the U.S. - will deliver significant fuel economy gains over the 51 miles per gallon rating of today's non-plug-in Prius. 
According to data released today by Edmunds.com, parent of AutoObserver, a remarkable 71 percent of all Toyotas sold last month were financed through a 0-percent loans. Battling the tide of negative publicity surrounding a string of recalls related to unintended acceleration, Toyota in March took the uncommon step of offering 0-percent loans for as much as 60 months on even its most popular models - including, at least in some markets, the Prius hybrid-electric vehicle.
SANTA MONICA, Calif. -- The still-deteriorating economy and the continued uncertainty about employment kept consumers away from buying new cars again in February despite the record-breaking deals available to them.
