January 19, 2010
Japan Alters Car Scrappage Scheme to Include U.S.
Japan's Trade Ministry changed the terms of its car scrappage incentive scheme on Tuesday to include vehicles imported from the United States, after complaints from Washington that U.S. vehicles were being excluded. According to Reuters, Tokyo's version of the Cash for Clunkers program provides government cash to help people replace old cars with models that meet specified fuel efficiency standards. Last week U.S. Secretary of State Hillary Clinton told Japanese Foreign Minister Katsuya Okada that concerns were rising in the U.S. Congress about Japan's scrappage scheme. But Japan's Trade Ministry reiterated in a statement on its website that although it was altering the program, the system made no distinction between domestic and foreign-produced cars, and 43 percent of imported vehicles met the conditions. The new provisions allow the scrappage incentives to be applied to suitable cars imported under the "Preferential Handling Procedure," a 1986 agreement with the U.S. to speed the import of models that sell less than 2,000 units a year. Last week, U.S. Congresswoman Betty Sutton introduced a resolution calling for the U.S. Trade Representative to start talks with Tokyo and urged Washington to bring a WTO case against Japan if it does not open up its program to American cars. Click here for more on Japan's decision to open its Cash for Clunkers program to American cars.
Toyota Faces Major Repair Work on its Image
Hiroyuki Yokoyama, the managing officer for quality and customer service at Toyota Motor Corp., tells Automotive News, "In this job, every day is a drama." Recalls in 2009 pushed Toyota to the top of the U.S. safety recall list for the first time ever, battering the company's reputation for superior safety and reliability. Yokoyama said Toyota has learned from recent lapses and has new quality improvement plans in place. But salvaging its integrity won't be easy. Analysts say Toyota has a long way to go - and a great deal at risk. Yokoyama said quality has suffered for a number of internal and external reasons, including Toyota's rapid increase in production; a proliferation of model types; more electronic controls; swelling global ranks of employees; and customers' heightened quality expectations. "Internally, we were not able to keep up with the external changes, and some of those results showed up in quality," he said. Yokoyama initially aimed to streamline feedback of customer complaints so problems could be caught earlier and also tried to weed out manufacturing and design bugs before cars left the plant. But over the years, recalls have shifted the focus to durability and safety. To read more about what Toyota is doing to improve its safety image, click here.
Ford, Mazda Deny they Plan to Break up China Joint Venture
According to Automotive News, Ford and Mazda said on Monday they had no plans to dissolve their joint venture in China. Representatives for the two companies were responding to media reports saying they and China's Chongqing Changan Automobile Co. had agreed to end their three-way tie-up by 2012. Ford's spokesman Teddy Liu dismissed the report as "speculation," and so did another representative from Mazda. Mazda's ties with Ford have weakened since the U.S. automaker reduced its controlling one-third stake in Mazda to 13 percent in 2008 to free up cash. Ford currently owns about 11 percent of Mazda, Japan's No. 5 automaker. China has been a major bright spot amid a sharp industry downturn thanks to Beijing's aggressive policy incentives, which have significantly bolstered automobile demand. Vehicle sales in the country jumped 46 percent to a record 13.6 million units last year, well exceeding its previous target of 10 million units, and are expected to continue to grow at a solid pace of roughly 10 percent this year, on continued policy support from Beijing and pent-up demand in smaller cities. For more on Ford and Mazda's rebuff of reports that they plan to end their joint venture in China, click here.
Review: 2010 Audi R8 5.2 FSI is an 'Avatar'-Style Creature
James Cameron's film "Avatar" dreams a world where humans can telepathically plug into beautiful blue creatures of extraordinary power and speed. But, according to Dan Neil at the Los Angeles Times, Audi beat him to it. The 2010 Audi R8 5.2 FSI - a billion-candlepower version of the R8 sports coupe with a Lamborghini V-10 engine wedged amidships - isn't simply quick (zero to 60 in 3.7 seconds) or fast (a quarter-mile in less than 12 seconds), but that the whole so thoroughly augments and flatters the abilities of the human behind the wheel. Click here for a photo of the Audi R8. The man-machine interface is so supple, so syncretic, the bit stream from the four wheels through the seat and steering so vivid and real-time that at times Neil writes he could taste the carbon fiber. This version of the R8 features a complete array of LED lighting instruments - headlamps, signals, fogs, and position lights. You'd also have to credit the jewel-box setting of the engine inside a carbon-webbed engine cradle, inside the lighted, under-glass compartment, as one of the finest two or three cubic feet of auto design anywhere. For Neil's entire review of the Audi R8 5.2 FSI, click here.
Most Affordable Luxury Vehicles
As the auto industry emerges from its worst year in the last three decades, makers of luxury cars, in particular, are desperate for good news. The likes of BMW, Mercedes-Benz, and Audi all reported stronger sales in December than in previous months, but they were hit especially hard in the doldrums of 2009. Total domestic luxury sales last year were 960,568 units, according to industry-tracker AutoData. In years prior they had nearly reached 1.5 million. To identify this year's most affordable luxury vehicles, Forbes used Vincentric data to determine the total cost of ownership for vehicles with a base price of at least $35,000. It then evaluated five-year totals for fuel costs, maintenance, repairs, average national insurance rates, depreciation, interest, opportunity costs, and taxes. The data assumes an annual rate of 15,000 miles driven per vehicle and a price of $2.60 for regular fuel, $2.86 for premium and $2.75 for diesel. It also applies an inflation rate for the fuel prices, since the calculations predict costs over five years. Click here to view a slideshow of Forbes' list of affordable luxury vehicles. Depreciation is the biggest factor in determining how much a certain vehicle will cost the owner. Fuel is the second-highest expense involved with a vehicle. Click here for complete coverage of Forbes' list of the most affordable luxury vehicles.
Healthcare for Your Employees at 50-70% of Major Medical Costs
Employee out-of-pocket expenses and premium contributions are leaving some employees without medical coverage. And while we don't know exactly how the future of healthcare will pan out, AIADA has partnered with Wells Fargo Insurance Services (WFIS) to bring an exclusive option to our members that offers relief now: MidMed. MidMed is an insurance program designed to mirror comprehensive major medical coverage, at 50-70 percent of major medical costs, offering flexibility, national networks, and wellness programs. MidMed is guarantee issue, does not require health questionnaires, can be provided to only certain groups of employees, and the only participation requirement is ten contracts. MidMed can also be customized with benefits including: inpatient and outpatient hospital services, wellness benefits, standard deductibles, office visit co-pays, co-insurance, and Rx plans. The important difference is an annual limit of $50,000. Based on many published statistics about group health insurance, 99 percent of claims filed annually are less than $18,150. AIADA and WFIS hosted a webinar for members to learn more about MidMed. To listen to the recorded webinar, click here. To learn more about this program contact Charles Wiedebusch, Dealer Advantage Program Account Executive, 866-779-6105 or charles_wiedebusch@wellsfargois.com. For more information on MidMed, click here.
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