Check Your Mirrors

FIAT has rolled out the new Bravo in Europe to mixed reviews. There is undoubtedly no way that Fiat can equal the success of the recently new Grande Punto, but they’d probably be happy with just a percentage of the acclaim (and the accompanying sales) the Punto has racked up. The Bravo is competing in the toughest segment in Europe, the one with the VW Golf, Opel Corsa, etc., so it’s not going to run away with the market by even the most optimistic of sales projections.

ABOUT half of all people that walk into a dealership (new and used) in the U.S. have non-prime credit, says the NADA (National Auto Dealers Association) through estimates supplied by their dealer members. The CBA (Consumer Bankers Association) says that half of all people who actually get a loan to finance a car have “A” credit, which is also called prime, and requires a credit bureau score (FICO) of 720 or above. Another 25% are in the “B” category, which is 680 to 720 FICO. So, that leaves a lot people driving their old car or taking the bus, doesn’t it?

FORD has signaled its intent to bring Ford of Europe product to the United States as soon as possible. Statements by Alan Mulally, Ford’s new CEO, show that he has been looking at the product lineup in Europe and has concluded that there are vehicles there that Americans would want to buy. Look for the Focus S-Max, the Mondeo, and the Transit Connect, a smaller version of the Transit commercial van seen all over Europe, to make the trip across the ocean. The Transit Connect could possibly be for sale in the States even before the 2008 calendar year.

GM has increased the limited powertrain warranty coverage on their certified used cars in the U.S. to 5 years or 100,000 miles, whichever comes first. Additionally, the warranty is fully transferable to subsequent owners. This move is expected to increase customer satisfaction with the used vehicle as well as increase the residuals of used General Motors vehicles throughout the lineup.

NANJING AUTO announced that it will start making cars in China based on the MG Rover technology it bought from the failed MG Rover in 2005. Nanjing stated that it would make four models in eastern China and the MG TF sports coupe in the former MG Rover facility in Longbridge, England.

NISSAN saw sales drop in the U.S. in the third quarter (ended Dec 31, 2006) and is now on track to have its worldwide profits drop for the first time since Carlos Ghosn became CEO of Renault and Nissan. Nissan had increases in car sales and increases in sales across the whole Infiniti line in the U.S., but sales of trucks dropped 8%. Let the second-guessing begin.

KIA is getting very serious about the EU market and nothing illustrates this better than the new Kia Cee’d (yeah, weird name). The new Cee’d was designed in the U.K., engineered in Germany, and is built in Slovakia. Pretty heady stuff for the Korean automaker, but Kia believes that’s what it’s going to take to get the market share they want in the EU by the end of 2008.

WHAT model has the highest percentage of Generation X (born between 1965 and 1979) owners? It’s a surprise to me, but Power Information Network says it is the gargantuan Nissan Armada SUV. I would have guessed something smaller. But I’m completely certain all those Gen X owners “need” their Nissan Armadas – they probably all have 5 or 6 kids and the AWD is needed because the family business is a logging camp somewhere. What is the model with the greatest amount of buyers in the generation born before 1945? C’mon you know this one, just think for a minute. Yup, that’s right; it’s the Lincoln Town Car. The model that has the highest percentage of baby boom (born between 1946 and 1964) buyers is the Volvo C70. Data rocks, huh?

FRANCE saw a 1.8 percent increase in new car sales in January, but the PSA/Peugeot-Citroen Group and Renault, France’s only two domestic manufacturers, didn’t get any of the increase, which went entirely to foreign car makers. In fact, in an up market, PSA/Peugeot-Citroen lost 3.3% and Renault lost 7.0%. The big winner last month was Volkswagen with an increase of 14.4%

NEW ZEALAND residents bought more bicycles than cars in 2006; in fact, 30,000 more new bikes were sold than new cars in NZ last year. Bicycle sales have increased 40% over the last four years according to sales figures supplied by both Statistics New Zealand and the NZ Motor Trade Association. There are approximately 4 million people in New Zealand.

FORD and GM both had an awful month in January sales, posting a 19 percent and 16.6 percent drop respectively in new vehicle sales. Most of the decrease can be attributed to both companies pinching off sales to car rental companies as Ford and General motors are trying to limit their low-profit sales transactions going forward. The margin on sales to rental car companies ranges from low to non-existent and both companies are trying to curtail the practice. Additionally, too many sales to rental companies tends to depress residuals of the vehicles in question, thereby negatively affecting the private owners of the same vehicles. It should be noted, however, that some of the bad magic was due to what hurts the Big 2 month after month – losing sales to the foreign manufacturers.

CANCER and cars: The American Academy of Dermatology says that new data shows a strong link between people who drive a lot and increased rates of skin cancer in the United States. As you might expect, the melanomas show up on the left side of the individuals in question. Researchers say the repeated and prolonged exposure to sunlight on the exposed left sides of drivers is the cause. While windshields are made of laminated glass that blocks most UVA and UVB radiation, the side and rear windows are made of non-laminated glass that blocks only UVB radiation (the sun’s burning rays), but not the deeper, more penetrating UVA radiation present at all times. According to the AAD, skin cancer is the most prevalent type of cancer in the U.S. with more than a million new cases diagnosed each year. Approximately 10,850 people will die from skin cancer this year.

Author: Brendan Moore

Brendan Moore is a Principal Consultant with Cedar Point Consulting , a management consulting practice based in the Washington, DC area. He also manages Autosavant Consulting, a separate practice within Cedar Point Consulting. where he advises businesses connected to the auto industry. Cedar Point Consulting can be found at http://www.cedarpointconsulting.com.

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