Automotive News

Stellantis Logo Revealed by Peugeot, Fiat Chrysler Ahead of Spring Merger

November 17, 2020 by admin Leave a Comment

Stellantis unites American, French, and Italian automakers.

“To brighten with stars” is the meaning of the sobriquet chosen by French automaker Peugeot Groupe (PSA) and Italian-American manufacturer Fiat Chrysler Automobiles (FCA) as they plan to merge their companies under the “Stellantis” banner next year. When done, the combined entity will create the world’s fourth-largest automaker, completing an effort that began before the pandemic and could establish a trend for competing businesses to follow.

Mission Stellantis

Stellantis may not roll off the tongue immediately, but the new company hopes that it accomplishes its mission nevertheless. That endeavor unites once competing businesses under a singular umbrella, bringing with it the synergies required. Cost-saving is chief among them as the new company will enable 14 disparate marques to coalesce; share platforms, engineering, and technologies; and give Stellantis greater clout when negotiating with suppliers. Thus, the Stellantis name is reserved exclusively for the enterprise.

Notably, the company’s name will not find its way to a single vehicle. Instead, all 14 brands will operate with their own make/models serving their respective markets. These brands comprise Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS, Fiat, Jeep, Lancia, Maserati, Opel, Peugeot, Ram, and Vauxhall. Ferrari is not included as that brand became independent a few years back.

Only one PSA name is not familiar to automotive enthusiasts: DS. The others, including Peugeot and Citroën, were once marketed in North America. Models from Opel and Vauxhall have also appeared stateside, most currently in the Buick Regal sedan, hatchback, and wagon.

Dutch Headquarters

The new company will be headquartered in Amsterdam, the Netherlands. It will continue to operate regional headquarters in Auburn Hills, Michigan; Paris, France; and Milan, Italy. Moreover, Stellantis will trade on three stock market exchanges: New York, Paris, and Milan.

Announced in October 2019, the $50 billion deal uniting PSA and FCA was finalized internally two months later. The understanding then, as it remains to this day, is that the companies must work through a lengthy closing process. Indeed, following its initial review, the companies won the approval of their respective shareholders as well as meeting other antitrust and other regulatory requirements. Some of the later milestones are yet in progress. An end-of-first-quarter 2021 closing is expected.

Peugeot’s USA Initiative

Well before the Stellantis development, the Peugeot brand has been working on returning to the U.S. on its own — without the four other PSA brands. For several years, the company has operated out of its Atlanta headquarters to begin the long work of bringing its vehicles to America. That effort will continue although it may now include some help from Stellantis’ American family.

Nothing has been said of this, but a company bent on consolidating to cut costs may find that Peugeot vehicles sold side-by-side with Chrysler brand products, for instance, is the best approach to advancing its agenda. We’d be surprised if this weren’t so.

Looking Ahead

Uniting disparate companies is often fraught with cultural challenges as evidenced in the earlier DaimlerChrysler debacle. Yet, a few years after that company separated, Fiat joined with Chrysler to form arguably a strong union. The Chrysler side will now have a third opportunity to work with an international automaker.

This time, the Fiat Chrysler team will come into this relationship on a 50:50 basis with the PSA Groupe. The Italian and French automakers are longtime rivals, but under the Stellantis umbrella, the new structure allows all stakeholders to advance two areas where the industry is heading: automation and electrification. Separately, the cost to develop them is nearly prohibitive for some companies who must then consider mergers, acquisitions, or alliances to move forward (GM and Honda, for example). Under Stellantis, the 14 brands will have the opportunity to not just survive but thrive, although further consolidation may cause underperforming brands such as Chrysler and Vauxhall to cease.

Logo courtesy of Fiat Chrysler and PSA Groupe.

How to Fix a Broken Rivian Vehicle

November 12, 2020 by admin Leave a Comment

American automotive and technology company Rivian is working diligently to bring its first vehicles to the market, with the production of its battery-electric R1T pickups and R1S SUVs beginning early next year. By June 2021, the first models should be in the customer’s hands, which will then reveal just how capable these models are.

No Dealerships

As with any vehicle launch, Rivian will spend several months producing launch models and testing the same before customers see one. This effort allows the company to identify potential problems and make repairs and adjustments to the build process. The goal is, of course, to supply flawless execution of the entire manufacturing regimen, to eliminate problems, and ensure customer satisfaction.

Inasmuch as any manufacturer attempts to get things right, problems occur after the fact. We’ve seen automakers bogged down with recalls, large and small, as well as service bulletins to handle problems that don’t warrant massive intervention. These issues are typically resolved at the dealership level, specifically through service departments tasked with handling maintenance and repairs.

On-Site and Local Repairs

However, Rivian does not have dealerships as the company will sell its electric vehicles directly to consumers, businesses, and other interested parties. Instead, we have learned that Rivian has a unique process in the works, one that’ll enable customers to seek out repairs nearby, including very locally.

In an interview with Automotive News, Rivian’s president CJ Scaringe said that the company will have a fully operational service network in place to handle repairs. Specifically, the network will comprise 41 service centers scattered across the United States. Customers will then have the option to bring their R1S or R1T to these centers for assistance.

But service centers are not the be-all and end-all, especially for customers who find themselves stranded or hundreds of miles between centers. Thus, the Rivian strategy also includes scheduled mobile service at homes or businesses. With this latter option, maintenance crews are dispatched to where they are needed, handling repairs that over-the-air updates cannot manage.

Amazon’s Stake and Order

The R1S and R1T are not the only electric vehicles Rivian will build at its Normal, Illinois, manufacturing plant. A third model, which is a delivery van, will launch in 2021 next year. Its primary customer is Amazon, one of several important Rivian stakeholders. Indeed, in September 2019, Amazon invested $700 million in Rivian and ordered 100,000 vehicles with deliveries through 2024.

Likely, Rivian will establish direct repair centers with Amazon to handle its needs. Or, it may routinely dispatch repair vehicles to Amazon facilities. Regardless, electric vehicles have so few running parts compared to models powered by an internal combustion engine, that such repairs should be few and accomplished quickly.

Three Editions

Besides detailing its maintenance and repair strategy, Rivian announced that its SUV and pickup truck will each be available in three editions, with a fourth likely following. The R1T Launch Edition ($75,000) and the R1S Launch Edition ($77,500) roll out in June and August, respectively. Canadian customers will have access to both vehicles beginning the following November.

The Launch Editions come with a 300-plus mile range and the Adventure Package. That package features a reinforced underbody shield and an on-board air compressor. For the truck, the package includes a power tonneau cover and a Gear Guard remote monitoring system. Inside, the two models include heated and cooled perforated vegan leather seats, natural-grained ash wood trim, and the Rivian Elevation 360-degree audio system with removable Bluetooth.

Besides the Launch and Adventure Package editions, an Explore Package rolls out in 2022. This one costs $67,500 (R1T) and $70,000 (R1S), with a lower level of content than the other trims. Yet, the same 300-mile range is standard.

Rivian promises an even lower-cost version of both models down the road, with a battery range of about 250 miles. Further, a longer-range R1S model is planned in both five- and seven-passenger seating capacities.

General Motors Deepens Partnership With Honda, Takes Stake in Nikola

September 8, 2020 by admin 1 Comment

GM’s plans for the future show a company willing to take risks.

Nikola Corporation and General Motors Co. announced a strategic partnership that begins with the Nikola Badger and carries cost reductions through all of Nikola’s programs, including: Nikola Badger, Nikola Tre, Nikola One, Nikola Two and NZT. As part of the agreement, Nikola will utilize General Motors’ Ultium battery system and Hydrotec fuel cell technology, representing a key commercialization milestone for General Motors.

Within only five days, the General Motors Company changed the course of its business in ways probably not foreseen by most automotive experts.

On Sept. 3, General Motors and Honda announced that the companies signed a non-binding Memo of Understanding (MoU) whereby the two would work toward establishing a strategic alliance in North America. That alliance would explore the two automakers sharing vehicle platforms and propulsion systems in a variety of core segments.

Five days later, General Motors announced a strategic partnership with Nikola Corporation, parent of Nikola Truck Company, an emerging manufacturer of electrified vehicles. As part of the agreement, GM takes an 11-percent stake in Nikola.

GM and Honda Expand Their Relationship

GM’s MoU with Honda was especially surprising, given the latter’s long-running independent course. Even as Nissan partnered with Renault and Mitsubishi to forge an extensive alliance and Toyota took stakes in multiple small Japanese manufacturers, Honda seemed content to stay the course.

But we’ve seen a willingness on Honda’s part in recent years to soften its resistance to collaborating with other manufacturers. Indeed, Honda joined GM’s battery module initiative in 2018, then followed in April 2020 with an announcement that the two manufacturers would jointly build a pair of all-new electric vehicles for Honda. The EVs are based on GM’s highly flexible EV platform powered by proprietary Ultium batteries.

Models powered by Ultium batteries feature a range of 400 miles or longer and are designed for Level 2 and DC fast charging. The second-generation Chevrolet Bolt EV, due out in 2021 as a 2022 model will utilize the new platform and battery system. A Cadillac Lyriq SUV will follow as will models for Buick and GMC.

The Honda-GM accord is a proposal, based on a joint committee composed of senior executives from both companies. The two will hold co-development planning discussions immediately, followed by engineering work set to begin in early 2021. Under the terms of the proposal, the two automakers will collaborate on building a variety of vehicles with a shared platform, including internal combustion and electric models. None of the models will be developed to serve other markets.

The automakers say that the companies will realize extensive savings in cost, including research and development (R&D) and engineering, and collaborating on purchasing.

Making a Case for Electrification

GM’s agreement with Nikola goes well beyond taking a stake in this upstart automaker. For example, the company immediately gains a $2 billion equity stake in Nikola, named for Nikola Tesla. Further, GM will engineer, validate, homologate, and build the Nikola Badger in both its battery-electric and fuel cell electric guises. Badger production is expected to commence by the end of 2022.

As a result of the strategic partnership, Nikola estimates it will save $4 billion in battery and powertrain ghosts over 10 years and an additional $1 billion in engineering and validation costs. As for GM, the company expects to receive at least $4 billion of benefits between the shares’ equity value, Badger contract manufacturing, supply contracts covering batteries and fuel cells, and EV credits that stay in place over the contract’s term.

GM and Honda have cooperated on projects dating to the beginning of this century. Since 2013, the two automakers have stepped up their cooperation.

Looking Ahead

Although the GM-Honda agreement must yet be finalized and is non-binding, the prospect of further collaboration between the two automakers is an enticing proposition.

We have no idea what vehicles the two manufacturers might build together, although it seems possible GM might perhaps gain car models, while Honda could benefit from GM’s truck lines. This is, of course, speculation but the possibilities are intriguing and will remain one part of a wider conversation involving electrification, mobility, technology, and collaboration.

Got a Recall? There’s an App for That.

August 31, 2020 by admin Leave a Comment

Consumers have heard plenty these past few years about automotive recalls, especially those involving airbags supplied by Takata. Tens of millions of cars are currently affected by airbags that may release dangerous projectiles on deployment.

But the Takata mess is just the tip of a recall iceberg involving vehicles, car seats, tires, and other equipment. With as many as thousands of parts and accessories present in many modern vehicles, something is bound to go wrong. The National Highway Traffic Safety Administration (NHTSA) tracks this information and now supplies a tool to help vehicle owners stay on top of it all.

That tool is none other than a new SaferCar app that’s easily downloadable to most any cell phone. So, why this app? Because as important as it is to stay on top of recalls, many are going unheeded. Notably, the NHTSA says that one in four vehicles currently in use has a safety recall. That’s a risk to the driver, passengers, other vehicles, and pedestrians, and is something that can and should be tracked and fixed as soon as possible.

How well does this app work? Well, we headed to the Apple App Store (Google Play Store for Android) and downloaded a copy to our iPhone and found the process straightforward. Once downloaded, you’ll be prompted to respond to a request to expedite notifications. If you “allow” notifications, then you may receive alerts, sounds, and icon badges for notifying a recall. You can control these requests in your cell phone’s settings.

Registering your vehicle is as easy as identifying it by its make, model, and year. You may find various versions of your vehicle listed, depending on the body style and drivetrain. Choose the one that most accurately describes your vehicle.

The app makes it easy to identify your vehicle. To help the app “understand” what you own, either scan or input the 17 alphanumeric sequence that represents your ride. I would love to say it scanned mine, but it did not. Instead, I took a photo of the VIN and then inputted the information to the app. The easiest way, of course, would have been to simply add that sequence while standing in front of the VIN.

Once the app has your information, it’ll issue you an update for your car. Mine returned the following statement: “This vehicle has no unrepaired recalls.”

What’s especially helpful about the app is what it can do. You can enter as many vehicles you like, thereby setting up your “virtual garage” for tracking those details. Besides your vehicles, there’s room to add tire, car seat, and information about the many accessories you may have. If there is a recall notification for anything listed, it will appear. Importantly, the NHTSA issues prompt notifications once it publishes its findings. This means that allowing notifications may be the best way to go. Otherwise, you’ll need to check your app regularly for updates.

What the app cannot do is arrange a recall fix. Instead, once you discover your vehicle is under recall, reach out to your local dealer’s repair shop for guidance. If a part must be replaced, the shop will tell you whether it is in stock or not. Moreover, you’ll need to make an appointment to have the recall handled.

The good news about a recall, is that they’re typically covered by the manufacturer. This means the repairs are made at the dealership level and the dealer bills the manufacturer. The same goes for recalls covering tires, car seats, and vehicle accessories. If you’re not sure a cost is involved, just ask.

We haven’t used the app much since its launch. There are bound to be some bugs present early on, so expect updates along the way. With this in mind, respond accordingly to keep the app current to ensure all recall notifications are delivered immediately.

Photo copyright NHTSA.

Jim Farley Appointed Ford President and CEO

August 5, 2020 by admin 3 Comments

James D. (Jim) Farley, Jr., is the Ford Motor Company’s next President and CEO, and much of the automotive media could not be more pleased. Farley, who left Toyota for Ford in 2007, has proven his mettle in a variety of positions, including as the one-time head of the Lincoln brand. He will succeed Jim Hackett who will step down on Oct. 1, but remain in an advisory capacity until spring 2021.

From Cars to Trucks and Utility Vehicles

Farley’s ascendancy comes as Ford transitions away from cars to an almost full utility vehicle and truck fleet, at least in the United States. Hackett was responsible for pulling the plug on several Ford and Lincoln cars, including the Focus RS, Fiesta ST, Fusion, and Taurus, as well as the Lincoln MKZ and Continental. That controversial decision upset not a few fans; Farley, of course, might reverse course or at least bring back a few niche models to fill out the product line.

Nevertheless, Ford is on the verge of releasing its Mustang Mach-E electric SUV and will soon roll out the next-generation F-150, its most popular model. Later this year, the Bronco Sport crossover arrives, followed by two- and four-door versions of the Bronco SUV in early 2021. The Bronco is expected to carve a niche in a segment dominated by the Jeep Wrangler.

Hackett, Stock Value and Profitability

Hackett came to Ford from a furniture company and has received criticism for not elevating Ford’s stock value and profitability. Regardless, Ford did make money in the second quarter, thanks largely to the profitability of its Argo AI unit. That’s opposite the trend of what most of the industry suffered in the second quarter as the global coronavirus pandemic took hold. Analysts expect Ford to make a profit of at least $500 million in the third quarter as production returns to pre-COVID-19 levels.

Farley is admired by many for his interest in vintage racing. Indeed, he owns Cobra and GT40 models that he races for that purpose. His family’s Ford roots can be traced to his grandfather who worked at the Ford River Rouge Plant beginning in 1914.

From Toyota to Lincoln to COO

Farley joined Toyota in 1990 and was responsible for rolling out the Scion brand. His other accomplishments included serving as group vice president and general manager of Lexus, where he was responsible for all sales, marketing and customer satisfaction activities. He also held a VP position with the Toyota brand.

In 2007, Ford hired Farley as group vice president, global marketing and Canada, Mexico and South America. Later, he oversaw operations for that same region. In 2010, Farley was appointed to lead global marketing sales and services. He had additional stints at Lincoln, including overseeing the brand’s launch in China and served as executive vice president and president, Ford Europe, Middle East and Africa. At present, Farley is the company’s Chief Operating Officer and represents Ford on the U.S. China Business Council Board of Directors.

Looking Ahead

Farley’s ascendancy comes as little surprise to industry analysts who have witnessed his grooming for the position early on. The upcoming CEO’s resume may be one of the best in the industry, thus his movement to the top tier of the Ford conglomerate is a natural next step.

His being a car guy is an attribute that should bode well for Ford. Like Akio Toyoda, whose design and racing background has influenced Toyota tremendously (a sporty Camry and a revived GR Supra are just two examples of his imprint), Farley brings skill and panache to his new role. We can speculate what that might mean, but rest assured his guidance should have far-reaching consequences throughout the company as it attempts to balance electrification and autonomy with the vehicles customers want most.

Photo copyright the Ford Motor Company.

Delayed Rivian On Track to Deliver Electric Trucks and SUVs

August 1, 2020 by admin Leave a Comment

Electric vehicle manufacturer Rivian has yet to roll out a production-ready model, but the company remains on track to produce a truck and a utility vehicle. The Plymouth, Michigan-based automaker with a manufacturing plant in Normal, Illinois, was expected to introduce its first model by the end of this calendar year. Instead, delays related to the COVID-19 pandemic have pushed that timeframe to next summer with the arrival of its R1T electric truck followed two months later by its R1S electric SUV.

Billions Raised; Fleet Orders In

That Rivian is still moving forward with its plans demonstrates its resiliency as well as its strong financial backing. Founded in 2009, the company operated mostly behind the scenes until recently when it revealed prototypes of its upcoming vehicles. Further, Rivian has raised more than $5 billion in capital investments from companies such as Amazon, the Ford Motor Company, Cox Automotive, T. Rowe Price, and BlackRock. It remains a privately-held enterprise although it does count outsiders such as a Ford executive as a board member.

Amazon has ordered more than 100,000 vans, a third model apparently designed with this Internet delivery company in mind. Also, the Ford Motor Company is developing an electric truck based on the skateboard chassis underpinning Rivian vehicles. However, a second model, a Lincoln SUV, was canceled because of the pandemic.

Incidentally, the flexible Rivian platform includes electric motors, controls, batteries, and a suspension system. Likely, it will underpin other models for Rivian as well as for varying manufacturers who develop their own shell and interior. This means manufacturers will enjoy a vehicle with four independent electric motors sending up to 200 horsepower to each wheel. The company claims the platform’s torque management system allows for everything from high-speed cornering to low-speed rock crawling.

Poached Employees; Ordering Details

Rivian hasn’t been without controversy as Tesla alleges the company has poached employees who brought trade secrets with them. Rivian has 2,300 employees and Tesla claims 178 once worked for them. Moreover, the company identified four Tesla-turned-Rivian employees for taking confidential documents with them. Tesla filed suit against Rivian; the case is pending.

Customers may “pre-order” a Rivian truck or SUV by supplying the company with a $1,000 deposit. The deposit automatically places the customer on a waiting list, but it doesn’t obligate them to follow through on their purchase decision. Indeed, the deposit is fully refundable. That’s a typical practice for these kinds of ground-breaking models from upstart manufacturers.

Profile: RJ Scaringe

Rivian is headed by RJ Scaringe, a 37-year-old engineer from Florida. Scaringe has a doctorate in mechanical engineering from MIT’s Sloan Automotive Lab.

Since its inception, the company now known as Rivian has undergone several changes, including its name and mission. Once called Avera Motors, the company changed its name following a lawsuit from Hyundai, which claimed “Avera” sounded too much like “Azera,” the name of its large sedan. The new name pays homage to the Indian River in Brevard County, Florida, where Avera was located.

Its mission has changed too as the company originally sought to build a small commuter car similar in scope to the Toyota Prius. Its new plans were originally kept under wrap for several years before its skateboard architecture emerged. What we see coming is based entirely on the new vision.

As of this writing, Rivian has more than 2,300 people on its payroll in locations such as Canada, the United Kingdom, California, Michigan, and Illinois. Eventually, the company will begin hiring workers for its Normal facility, which it acquired from Mitsubishi Motors in 2018. State and local incentives to the tune of $249 million made that acquisition possible.

See Also — About the 2021 Lordstown Endurance

Logo copyright Rivian. All rights by the manufacturer reserved.

Honda Tosses Three Models

July 20, 2020 by admin Leave a Comment

The car model carnage continues.

The Honda Civic Coupe is on its way out.

Automotive manufacturers have been dropping car models left and right as consumers continue to show a preference for utility vehicles and trucks. Through 2020, the American Honda Motor Co, Inc., has largely escaped the carnage, but that’s about to end. Indeed, there are three car models slated for cancellation, including one nameplate that will soon be gone altogether. Automotive News [subscription required] broke this story last Friday.

Honda Shuffles Its Product Line

The first model slated for cancellation is the Fit, Honda’s subcompact and smallest model. Introduced in 2007 and slotted beneath the Civic, the Fit recaptured much of the size and thriftiness of the original Civic. This four-door hatchback has served the brand well and has also undergone several updates. An all-new Fit is already in place in markets across the world, but the United States will not get one. Consequently, Fit production in Mexico will end. Honda will now expand production of its tiniest crossover, the HR-V.

Honda’s first car model for the U.S. market was the Civic, launched in 1973. It was small, fuel-efficient, and reliable, traits that soon made it one of America’s most popular cars. The Civic line has grown and changed body styles since, with a coupe, sedan, and hatchback comprising its model line. This three-prong approach has worked well for Honda in a segment where few competitors offer anything besides a sedan. Unfortunately, the coupe won’t see the 2021 model year, as Honda says it will stay with the sedan and hatchback. However, there is good news: an all-new Civic is on the way next year.

Honda’s largest car model and a strong volume driver like the Civic is its midsize Accord sedan. This vehicle is stylish, roomy, and loaded with tech features. Arguably, it is the best model in its segment. It is also one of the few cars still offering a manual transmission, as its Sport model delivered one with a choice of 1.5- and 2.0-liter engines. That six-speed manual, though, had a very tiny take rate. As such, it also won’t see the 2021 model year. In effect, Honda shuts the door on midsize models with manual gearboxes, following the Toyota Camry and Mazda6 which did so several years back.

Honda Looks Ahead

By adjusting its product line, Honda follows the vast majority of other manufacturers by cutting car models. But there are some exceptions as Toyota, Nissan, Hyundai, and Kia hold the line.

As a matter of fact, with the Fit gone, the Toyota Yaris, Nissan Versa, Hyundai Accent, and Kia Rio will have one less competitor to battle. The Ford Fiesta is already gone, while the Chevrolet Sonic is also in its final year. Some manufacturers, such as Fiat Chrysler don’t offer a subcompact, although the Fiat 500 is small enough to occupy the “micro” segment.

Just as Honda cancels some models, it is doubling down on others. For instance, beginning in 2021, the Honda Pilot features a 9-speed automatic transmission across the entire trim line. Gone is the base six-speed automatic that seemed out of place.

Civic Type R Limited Edition

We’ll soon see the Civic Type R Limited Edition, a performance model limited to just 600 models. Offered exclusively in a Phoenix Yellow patina with gloss-black accents, this hot Honda features 20-inch BBS forged-aluminum wheels set within Michelin Pilot Sport Cup 2 Tires, a Honda LogR Datalogger System, and recalibrated steering for enhanced control and improved feedback.

What’s significant about the latest Type R is that it is 46 pounds lighter, which should help it win back the Nürburgring Nordschleife laurels it lost to the Renault Megane RS Trophy-R in 2019 for the fastest time of any front-wheel-drive model in the world. The revised Honda will continue with its 2.0-liter turbocharged four-cylinder engine, which carries a 306 horsepower and 295 pound-foot of torque rating. Power travels to the front wheels via a six-speed manual transmission.

Photo copyright American Honda.

Lincoln Axes the Continental

July 2, 2020 by admin 2 Comments

Ford’s luxury brand goes all-in on utility vehicles.

The last Lincoln sedan goes away this December.

The Lincoln Continental is one of the most storied models for Ford’s luxury marque, a big sedan with outsized styling, generous amenities, and class-leading comfort. In 2016, Lincoln resurrected the Continental to critical acclaim. Alas, its revival came as consumers eschewed sedans for utility vehicles, effectively ensuring that the latest Continental would serve only the smallest audience.

Production Ends in December

North American consumers will not see a Continental for the 2021 model year as Lincoln announced on Wednesday that production would cease by end of the year. Those models built this fall will be allocated exclusively for China where large sedans have a stronger following. Nevertheless, Ford’s Flat Rock, Michigan, assembly plant will finish producing Continentals in December.

Lincoln revived the Continental nameplate by unveiling a concept with center-hinged doors at the 2015 New York International Auto Show. Just over a year later, the all-new Continental rolled out for the 2017 model year. It replaced the previous and comparatively anonymous MKS, sitting on a stretched and modified version of the platform underpinning the Ford Fusion and Lincoln MKZ.

An Outlier Among Luxury Sedans

With standard front-wheel drive and available all-wheel drive, the current Continental competed in a segment dominated by rear-wheel-drive models. That said, customers could upgrade from the standard front-wheel-drive model with a naturally aspirated V6 engine and go with one of two turbocharged V6 engines with all-wheel drive.

We reviewed a Black Label model in 2017 outfitted with the larger of the two turbo engines and lauded its performance. Although we couldn’t call it a “Hot-Rod Lincoln,” its performance credentials were certainly noteworthy.

Sedans Give Way to SUVs

With the Continental following the MKZ to the defunct model playground, Lincoln will rely on its quartet of utility vehicles to advance the brand. These models are the full-size and traditional SUV Lincoln Navigator, a pair of midsize models – the three-row Aviator and two-row Nautilus, and the compact Corsair. We may yet see additional models although the planned all-electric SUV built with upstart Rivian will not happen.

Lincoln may point to the decline of sedans as a good reason to cancel the Continental, but its competitors aren’t giving up on them. Indeed Cadillac, its arch-rival domestic competitor, currently offers a trio of sedans although the largest of three, the CT6, is slated for cancellation. The CT6 is a near competitor to the Continental and rides on a rear-wheel-drive platform as do the smaller XT4 and XT5 models.

Hyundai’s Genesis luxury brand has effectively demonstrated that building quality sedans still finds a ready audience. It, too, has a trio of sedans for the offing (we’re currently reviewing the G70) and will soon at its first SUV this fall. Mercedes-Benz, BMW, and Audi are also deeply invested in sedans even as demand for SUVs soars.

Ultimately, it comes down to investing priorities – Ford has cast its lot exclusively with SUVs, following the pattern that has made Land Rover the respected brand that it is.

Coronavirus: An Industry Under Siege

May 5, 2020 by admin 3 Comments

Car manufacturers are finding different ways to support Americans during the pandemic. Here, a technician administers a COVID-19 test for a passenger at a drive-thru testing center. This particular center is the Children’s Hospital in Washington, DC. Hyundai supplied $4 million in grants through its Hyundai Hope On Wheels program to help underwrite testing (photo copyright Hyundai Motors).

Two months in and the 2020 Covid-19 pandemic shows little signs of ebbing. Sure, we’re seeing the number of new cases fall in many of the earlier hotspots, but in other areas of the country as well as in the world, the scourge seems persistent and ever-expanding.

Trillions of dollars of commerce have disappeared, with the federal government countering with trillions more in financial relief to assist small businesses and taxpayers. In the middle of it all is big business, including the automakers who depend on a steady stream of customers to keep their enterprises afloat.

Deep Losses Abound

To the surprise of no one, the U.S. auto industry’s sales have plunged, with some manufacturers, such as Honda, reporting losses above 50 percent. Manufacturing plants the world over have shut or are operating at reduced capacity. Also, the supply network is on hold, while consumers are more concerned about putting food on their tables, obtaining unemployment assistance, and holding off landlords, mortgage companies, and utility companies in an effort to stay afloat.

Yet, in these distressing times there remains a glimmer of hope. Americans are practicing physical distancing, virus testing and tracing continues to expand, and businesses are figuring out ways to reach consumers going forward.

Early on, manufacturers set out to console consumers, including those who were already financing or leasing their vehicles. Auto Trends received copies of various alerts, informing owners of options available, including deferred payments. The last thing anyone wants to see is a massive repossessing of late-model cars and the financial carnage that would cause.

Special Financing and Cash Back Deals

Besides reaching out to current owners, the automakers quickly updated their financing and leasing schemes to reach new-vehicle shoppers. Fiat Chrysler led the charge, rolling out 0-percent financing for up to 84 months, an uncommonly long timeframe. Besides its novel financing approach, the cashback deals are also better. Our internal survey shows savings of $7,300 to more than $10,000 on the Ram pickup trucks alone.

Other manufacturers joined in, delivering a variety of offers. For example, Toyota offers 0-percent financing for 60 months on three models: its midsize Camry sedan, compact RAV4 crossover, and Tacoma pickup truck. Hyundai rolled out 0-percent financing for 84 months on its compact Elantra sedan and compact Tucson crossover. Moreover, well-qualified Hyundai buyers enjoy a 120-day deferment on their first payment.

Canceled: Electrified Lincoln SUV

Beyond consumer assistance, the manufacturers have responded in various ways by delaying the introduction of new models or scuttling a planned vehicle completely. For an example of the latter, the Ford Motor Company canceled the planned all-electric SUV for Lincoln. The company cited the coronavirus crisis as the reason for canceling the SUV. Ford will, however, continue with its plan to release a Ford-brand pickup truck based on Rivian’s platform.

Manufacturing plants across America endured weeks of shut down, beginning in March. By early May, several plants in the southern U.S. resumed operation, including facilities owned by BMW, Hyundai, and Kia. All three follow Volkswagen, which restarted production at its massive Chattanooga plant at the end of April.

None are operating anywhere near full capacity as manufacturers maintain distancing, while also testing the veracity of their fragile supply chains.

Looking Ahead

The current downturn easily rivals the losses experienced during the Great Recession of 2008-2009. But the unemployment numbers today are far higher, with the rate spiking to an estimated 16.1-percent when the figures become known on Friday. As the states relax their various shutdown edicts, we expect that number to start to drop. Still, it could be many months if not longer before unemployment returns to an acceptable level.

If you’re in the market for a new vehicle, there are deals to be had. This writer exchanged his 2017 RAV4 for a 2020 Corolla, in April as the lease on the crossover came due. Opting for another lease, we lowered our monthly payments by selecting a lower-cost car and took advantage of incentives to save more money. Likewise, savvy consumers able to swing a new vehicle purchase should also garner an outstanding deal.

But there is one problem on the horizon: dealer stock is falling and, in many cases, won’t see replenishment until manufacturing resumes. Therefore, look for spot shortages until then, with pickup truck stock shrinking the most.

U.S. Auto Sales:
A Pandemic Race to the Bottom

April 2, 2020 by admin Leave a Comment

March 2020 U.S. auto sales drop through the floor.

As expected, the U.S. auto sales numbers for March 2020 reflect what we already knew: a substantial correction, resulting almost entirely from the COVID-19 pandemic. Every manufacturer and brand posted losses in March, as the country went through an expanding area of “stay at home” orders covering most of the nation. The full impact of the coronavirus outbreak is not yet known, but consumers are staying away from showrooms.

More than 3 million Americans were suddenly left jobless by the third week of March, effectively removing a source of consumers who might show interest in purchasing a new vehicle. In some states, dealerships shut down, while in others they stayed open under local “essential services” rules.

All three of the major domestics – GM, Ford, and Fiat Chrysler – reported losses. The Big 3, as they are colloquially known – stopped reporting monthly sales figures, choosing to share quarterly data only. With the first quarter done, nearly every brand showed net losses. Ram was the lone exception; Korean make Kia also came out on the plus side.
GM’s quarterly sales fell 7 percent, while Fiat Chrysler slid 10 percent. Ford’s numbers were not available as of this writing, but losses rivaling its chief competitors is in order.

Other automakers reported their March sales, which give a stark picture of what happened last month. Subaru, which has seen a steady increase in sales since the last recession, registered a 47-percent drop in March. The loss snapped a month-over-month streak that spanned more than eight years. Indeed, Subaru is facing the end of 11 consecutive years of growth that have transformed this niche automaker into an important player in the U.S. market.

In no particular order, sales numbers culled from manufacturing data is as follows:

Kia sales fell 22.9 percent for the month, but remain up slightly for the year. Two strong months to begin the year have kept this Korean manufacturer in the black, although we expect that’ll change during the first week of April. Hyundai’s sales fell 43 percent of the month, thus it sold fewer cars than Kia, its sister brand.

Mitsubishi reported a 42-percent sales drop, while Mazda’s sales plunged 42.8-percent. Mazda enjoyed strong sales in January and February, thus it is only down 4.9 percent for the quarter.

Porsche’s quarterly sales dropped 20.2 percent, with every established model registering double-digit losses. Porsche also started delivering its Taycan all-electric model, with 221 units sold in the first quarter.

Volkswagen sales dropped 42 percent for the month and are down 13 percent for the year. The automaker rolled out the new Atlas Cross Sport model during the first quarter.

Toyota sales fell nearly 37 percent for the month and are down 8.8 percent for the first quarter. New models counted during the January-March period include the GR Supra sportscar and the Yaris Hatchback.

Nissan Group sales, inclusive of the Infiniti and Nissan brands, are down nearly 30 percent for the quarter. This automaker had already experienced a significant downturn ahead of the coronavirus crisis with its sales falling the steepest amongst the major manufacturers.

Honda experienced one of the largest month-over-month drops of any manufacturer with March 2020 sales down 48 percent compared to March 2019. For the quarter, Honda sales – inclusive of the Honda and Acura brands – are off 19.2 percent.

Other manufacturers, including Ford, Mercedes-Benz, and BMW will report today or Friday. All three will share substantial losses for March.

Looking Ahead

April 2020 sales will continue to fall as the COVID-19 pandemic worsens across the United States. With various “stay at home” directives in place, consumers won’t be visiting showrooms in many areas. For lessees, opting for an extension may bide them some time, otherwise inventory turnover should be light for the second quarter, perhaps rebounding in the second half of the year as the pandemic eases.