November 5, 2012
Toyota Doubles N.A. Earnings, Lifts Global Forecast
According to Automotive News, Toyota Motor Corp.'s sales surged 45 percent in North America in the latest quarter while operating profit in the region doubled to help the automaker raise its full-year profit outlook. Regional sales climbed to 598,000 units in the three months ended Sept. 30, the company's fiscal second quarter, up from 413,000 a year earlier, when sales worldwide were hampered by the earthquake in Japan. Operating profit in North America jumped to 64.9 billion yen ($807.1 million) in the quarter, from 32.5 billion yen the year before. Toyota attributed that partly to increased output. Toyota's global net profit more than tripled to 257.9 billion yen ($3.2 billion). "In North America, operating income improved as a result of increased vehicle production and sales, despite the decreased contribution from financial services," Executive Vice President Satoshi Ozawa said while announcing the results. With U.S. demand rebounding and Toyota's supply chain back to normal, Japan's biggest carmaker increased North American production 42 percent to 391,000 vehicles in the quarter. Shares in Toyota, valued at nearly $135 billion – almost as much as Honda, Nissan and Hyundai combined – are up by a quarter this year. Read more about Toyota’s rebound here.
Buyers Will Travel Farther to Buys Cars with Positive Online Reviews
A positive online review of a dealership can draw a wider radius of potential car buyers, says a new study of more than 1,600 car buyers and 600 dealerships by Digital Air Strike. Its fall 2012 Automotive Social Media and Reputation Trend Study found that nearly 70 percent of recent car buyers said online review sites influenced their choice of dealership. Review sites, dealership websites, and Facebook were named as the top three most influential digital mediums used to help buyers make their dealership selection. According to Auto Remarketing, the study also found that car buyers are increasingly using social media in the vehicle purchasing process. Facebook fan counts are increasing, according to the study, with the average count rising to 719 likes, up from 560 likes in April. When visiting dealer Facebook sites, buyers cited their top five most valuable items as dealership service promotions such as coupons or discounts; pictures of cars; sales promotions; reviews from consumers about the dealership; and articles about cars and/or car care tips. Click here for an infographic on how social media is driving car buying. For more on the role of the Internet in car buying, click here.
Survey: Fuel Economy in New Cars Hits Highest Level Since '07
Fuel economy of new vehicles purchased in October hit its highest level since at least 2007, the University of Michigan Transportation Research Institute said today. The average fuel economy based on window-sticker value of new vehicles sold in the U.S. in October was 24.1 mpg – the highest level yet, and up 4.0 mpg from October 2007, the first month of monitoring. According to The Detroit News, this 20 percent improvement in fuel economy corresponds to a 17 percent reduction in fuel consumption. The University of Michigan Eco-Driving Index – an index that estimates the average monthly emissions of greenhouse gases generated by individual U.S. drivers – stood at 0.81 in August, an improvement of 19 percent since October 2007. The EDI takes into account both vehicle fuel economy and distance driven. Officials noted that all of the values are now corrected for the changes in the EPA ratings for the Hyundai/Kia vehicles that were issued on Friday. After gas prices for much of 2012 have been at record highs, gas prices have fallen by $0.21 a gallon over the last two weeks to a national average of $3.55, the sharpest dip since 2008. Click here for more on improving vehicle fuel economy.
Fixing Cars Now Often Means Updating Software
It used to be that when cars left the factory, automakers had nothing further to do with them unless the manufacturers had made some terrible mistake in assembling them. Now that cars have as much computing power as they have horsepower, it should come as no surprise that they are getting software updates too. Few cars have the persistent Internet connection most computers have, so these updates won’t go out to the cars automatically. Instead, drivers typically bring their cars to their dealers for updates. Do-it-yourself-oriented Ford owners can perform their own updates from flash drives. Taking the car to the dealer sounds like a hassle, but owners can schedule the software update at the same time as their oil change, thereby taking care of both maintenance issues at the same time. According to NBCNews.com, just as computer and consumer electronics companies have telephone help centers to guide customers in their products’ use, so too do car companies. When those call centers notice a large volume of calls from customers complaining of the same problem, it points to the need for a change as to how a particular device works in the car. Click here for more on how software plays a role in today’s auto repairs.
Ghosn: We Need Another N.A. Plant
Nissan Motor Co. CEO Carlos Ghosn says the company will need another assembly plant in North America within five years – after it reaches his goal of taking 10 percent of the U.S. market. According to Automotive News, the additional capacity could be used to build Infiniti nameplates, Ghosn said during an interview. He also said the luxury brand's top priority is selling more of its existing high-volume models, and he downplayed Infiniti's need for an exotic halo model. "Whenever we reach 10 percent market share in the United States," Ghosn said, "I think we're going to need more capacity." He said he expects to hit that level before 2017. As part of Ghosn's current midterm business plan for Nissan, the automaker targets a 10 percent market share in the United States by the end of the fiscal year ending March 31, 2017. Even with a new plant in Mexico that will open next year, "We don't have too much available capacity in North America," Ghosn said. "There will hopefully be more to come." Through October, combined Nissan and Infiniti sales rose 11 percent to 946,169 units, compared with an industrywide gain of 14 percent. Click here for more from Nissan’s Carlos Ghosn.
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