September 26, 2012
Razzle Dazzle at Paris Show Can't Hide Gloom
Europe's automakers will seek to dazzle at the Paris auto show starting on Thursday, revealing over 100 new models ranging from Opel's new cheap and cheerful Adam micro-mini to the McLaren P1 supercar, expected to cost more than $240,000. But no amount of shiny chrome can distract automakers from the deep-rooted challenges facing them in the European market, the world's most competitive and its worst-performing. Painful, unpopular decisions are now the order of the day, reports Automotive News. Even the German manufacturers – which had looked crisis-proof – are no longer immune. Volkswagen, Europe's largest carmaker, which had been doing well, stealing market share from its struggling competitors, warned on Tuesday that business conditions had become "significantly more difficult." The U.S. car market crisis in 2008 was sharp and dramatic, although Europe's slump is shaping up to be a long distance marathon with the finish line a hoped-for 2015 recovery. The Paris show will demonstrate the strategies different carmakers have adopted to deal with the crisis. Green crossovers should attract attention, however, as carmakers hope to lure environment-conscious families. Click here for more on what to expect as the Paris auto show gets underway this week.
California Governor Signs Driverless Cars Bill
Gov. Jerry Brown rode to Google headquarters in a self-driving Toyota Prius before signing legislation Tuesday that will pave the way for driverless cars in California. The bill by Democratic Sen. Alex Padilla will establish safety and performance regulations to test and operate autonomous vehicles on state roads and highways, reports The Detroit News. "Today we're looking at science fiction becoming tomorrow's reality – the self-driving car," Brown said. "Anyone who gets inside a car and finds out the car is driving will be a little skittish, but they'll get over it." Google Inc. has been developing autonomous car technology and lobbying for the regulations. The company's fleet of a dozen computer-controlled vehicles has logged more than 300,000 miles of self-driving without an accident, according to Google. "I think the self-driving car can really dramatically improve the quality of life for everyone," Google co-founder Sergey Brin said. Autonomous cars can make roads safer, free commuters from the drudgery of driving, reduce congestion, and provide transport to people who can't drive themselves, such as the blind, disabled, elderly and intoxicated, Brin said. Click here to read more about California’s driverless vehicle legislation that was recently signed into law.
Used Car Clunkers to Avoid
With the average new car selling for around $30,000, and even a moderately equipped compact model going for close to $20,000 these days, cash-strapped motorists have little choice but to purchase a used vehicle. Unfortunately, a relatively short supply of pre-owned models – precipitated by the 2007-2009 economic recession, when fewer new vehicles were purchased or leased – continues to keep used-car values at or near record-high levels. What’s more, even though today’s cars tend to last far longer than did models from 20 or more years ago, like fine wines some tend to age better than comparable models of the same vintage. With used-car values already out of whack, shoppers need to be extra cautious to avoid compounding an already unfavorable financial situation by selecting a more-problematic model that will require costly out-of-warranty repair work. To that end Forbes has compiled the accompanying rogues gallery of 10 used cars to avoid, based on data they’ve compiled from multiple sources including reliability surveys, safety ratings, resale values, and their own experiences road-testing the vehicles over the years. Click here to check out the list. To read more about which used vehicle “clunkers” to avoid, click here.
Here Yesterday, Gone Tomorrow
The school year may have just begun, but the automotive Class of 2013 is already well settled at dealerships around the nation. Each model year brings new models to fill showroom spaces vacated by cars and trucks that have been discontinued. For 2013, more than a dozen nameplates will not be returning, and two automotive brands have also expired. After a protracted bankruptcy and with legal tussles continuing, the 63-year operations of Saab, the Swedish automaker, are being dismantled. Likewise, Daimler’s Maybach line of ultraluxury sedans is fading away after a decade-long revival. Some vehicles are not being replaced, like the Mercedes-Benz R-Class wagon and the electric Tesla Roadster. Others, like the Dodge Caliber, will be indirectly replaced by a different vehicle in the same segment. The New York Times is featuring a list of vehicles that are disappearing. First up is Aston Martin’s DBS, which is being replaced by the 565 horsepower Vanquish coupe and convertible. In the SUV category, the Mazda CX-7 is disappearing as the CX-5 and CX-9 fill Mazda’s SUV lineup. Read about the other vehicles that are making their final bow here.
Average Trade-In Age Under 6 Years
The state where dealers saw the youngest trade-ins flowing on to their lots last month was Oklahoma, reports Auto Remarketing. The publication cites a report from Edmunds’ Inside Line indicating that trade-ins in the state were an average of 4.95 years old in August. Tied for second-youngest were Wyoming and Mississippi, where the average age for trade-ins was at 5.05 years. Texas was next (5.13 years) followed by Alabama (5.14 years). The average age, nationally, for a trade-in during August was 5.88 years. Trade-ins are a major stream of used inventory for dealers. Another important avenue is that of the lease return. Last week, Edmunds projected that lease return volume would climb by nearly 500,000 units in 2013. The publication’s chief economist, Lacey Plache, noted in her analysis that when comparing expectations for 2013 against 2012, the number of lessees returning to market will likely climb by 484,000 next year. Edmunds anticipates that more than 2.5 million leases will reach end-of-term next year. That would be the highest number of lease terminations since 2010, creating what could be a flood of potential used inventory for dealers. For more on what to expect from used vehicles, click here.
Around the Web
BMW Racer Takes Wife Around the 'Ring [TopGear]
Would You Drive a Vintage Porsche if You Could Never Put the Top Up? [Jalopnik]
Further Speculation About Radical New SRT Barracuda [Autoblog]
Flo Makes 'Top 10' Ad List [The Car Connection]