More Bad News for Detroit

[CoDer]

More Bad News for Detroit

By Eric Peters
Netscape Autos Editor
March 2, 2006


A shut-out is about as bad as it gets in sports -- and in business. And it's just happened to America's automakers -- not one of whom made it into Consumer Reports' "Top 10" ranking of new cars for 2006.
Four of the ten were Hondas -- including the just-redesigned Civic and the Ridgeline pick-up, Honda's first-ever truck. Toyota scored two slots for the Prius and Highlander hybrids -- a category of vehicle it pioneered. Subaru's Forester and Impreza also made the cut -- as did the Infiniti M35 luxury-sport sedan.

This is the first time in the 10-year history of the "Top Ten" rankings that Consumer Reports has not listed at least one domestic model car or truck as a recommended pick.

The news was accompanied by much wailing and gnashing of teeth in the Motor City.

If there's any consolation to be had for America's car companies, it is that CR's rankings are at least partially subjective -- based on the personal likes and dislikes of the editors as well as on surveys of CR readers -- who may have a bias toward import cars that puts the domestics at a disadvantage.

And there's no question that the overall quality of American brand vehicles is much-improved today -- as evidenced by objective data such as the incidence of recalls for major problems and consumer complaints. GM and Ford are making the best vehicles they've built in some time, at least quality-wise.

However, America's automakers are fighting an uphill battle to regain the consumer confidence they lost after many years of so-so quality and a series of high-profile "problem cars" -- from the Oldsmobile diesel in the late 1970s to Ford Explorer rollover debacle just a few years ago. The customers lost to the imports will be exceptionally hard to recover. Having been burned once, why would they risk being burned twice?

Also, the domestics have had trouble connecting with the market -- building cars that management thinks buyers ought to want rather than building cars the market does in fact want. Recent examples of this disconnect include the unfortunate Pontiac Aztek and GTO, as well as the Lincoln Aviator and Ford Excursion SUV. All flopped badly and had to be cancelled after just a few short years of lackluster sales.

There is no analog for such poor perception of market needs/wants among the Japanese manufacturers -- who continue to display an uncanny insight into what people want -- and are willing to pay full price for. The radical in design Honda Ridgeline is a case in point. It's neither a car nor a truck -- but a brilliant fusion of both. Honda realized many suburban buyers want the occasional utility of a pick-up bed, but not the clunky truck handling (and awful gas mileage) of a conventional pick-up. So they built the Ridgeline off a car "platform," or underlying chassis -- and gave it just enough "truck" capability (the bed, the standard all-wheel-drive system) mixed together with the ride and handling of a passenger sedan.

Or consider the new Civic. It sets a new high water mark for what a small car should be --offering such things as GPS navigation (also available in Mazda's excellent 3 series) and -- in the sport-themed Si version -- a 197-hp engine with variable valve timing an 8,300 RPM redline and a six-speed manual transmission. This car (and import sport compacts like it) has become the "in" car for 18-25 year-olds, for the same reason that '55-'57 Chevies once ruled the street a few generations ago. Style, affordability and great price -- in one package.

It seems straightforward enough -- but the domestics (GM especially) just don't seem to get it. The blandly styled, "badge-engineered" GTO stands in sharp contrast to the lean, exciting Civic Si.

Ford has done much better with the new Mustang -- but it's a bit pricey for the younger crowd. The new Fusion (and Mercury Milan) are good-looking, well-built compact sedans -- but their fate depends on buyers being willing to give Ford a shot.

Which they may not do.

In addition to the embarrassing CR rankings (or non-rankings), there was more bad news for domestic automakers in terms of sales this year so far. Ford sales dropped by another 4 percent in February; GM was down 2.5 percent. Honda, meanwhile, posted an 8.7 percent increase over the same period -- and Toyota is poised to sell a staggering 9 billion cars worldwide this year -- possibly overtaking General Motors as the world's largest automaker.

The "bread and butter" Camry continues to be the best-selling car in North America -- and Toyota is making steady inroads into the final redoubt of American car company strength, large trucks and SUVs.

There's plenty of blame to go around for all this -- and depending on your personal biases, you can lay it at the feet of the unions, government meddling -- unfair trade practices on the part of the Japanese. Etc. But the bottom line reality is that American car companies have lost the allegiance of consumers -- not just Consumer Reports.

Until -- and if -- they can get it back, the slide will continue apace.

Might as well close additional plant if they will not change their act.

[chris_d]

uhmm, Toyota is poised to sell 9 billion cars worldwide this year? 9 billion???

[CoDer]

9 billion for this year? How in the world toyota will do that???

Ahhh.. maybe his referring to an accumulated sales over the years reaching a staggering 9 billion this year.

[empy]

ok lang, at least the Pistons will win the nba title this year

[moneywhiz]

9 billion for this year? How in the world toyota will do that???

Ahhh.. maybe his referring to an accumulated sales over the years reaching a staggering 9 billion this year.

boss...its not 9 billion, its 9 million

[badkuk]

ano kaya ung main reasons for this?

1. bland designs?
2. poor quality control?
3. expensive labor?


whaddya think...the koreans formed an alliance with japanese car makers, and they've managed to raise the quality of their cars. baka it's time for the americans to ally themselves with the japanese/koreans as well? tingin ko the timing is still ok, when the japs(well, toyota in particular) are making a move into the american market, at habang me bargaining chip pa sila(factories, distribution and marketing network)


of course, some diehard americans will have mixed feelings about it, since parang inamin na nila that japs are better at building cars. pero kesa naman tuluyan silang maglaho

[nugundam93]

wohooo! forester and impreza! :D

[stinkaboy]

OT: kala ko detroit pistons

[niky]

Actually, the Koreans bought Japanese technology off Japanese manufacturers, and then started engineering their own once they'd gotten the hang of it.

It's something US automakers can't quite come to grips with. They refused to believe for a long time that their engineering was lacking in any way. They cut corners in places where Japanese car makers went that extra mile to win over customers.

Sure, you save a lot of money by keeping an old OHV V6 in your family hauler, but if the buyer your after decides to go for that DOHC V6 VVTi (etc etc etc) in the Japanese car selling across the street, tough luck for you.

What's weird in the article is they're saying the Ridgeline is a hit? According to sales figures, they've barely sold 5,000 units since January... while the Dodge Ram, the Ford F-series and the Chevy Silverado have sold over 110,000 units combined...

[CoDer]

boss...its not 9 billion, its 9 million

Sabi ko na ngaba eh.