Archive for April, 2010
Smartphone applications have helped luxury carmaker Mercedes-Benz collect about $2.5 million in lease or loan payments since they launched six months ago.
Andreas Hinrichs, the company’s vice president of marketing, told the Wall Street Journal that its Mercedes-Benz Financial Application, which allows customers to manage their accounts and performs several other functions, has been downloaded by 11,000 people.
"We wanted to be the first out there and now we have seen rapid customer adoption," Hinrichs told the news provider.
This summer, Fox Business reported that Mercedes Benz, a unit of Daimler AG, will launch two more applications for the iPhone and BlackBerry that can remotely control the car or locate it in a crowded parking lot.
The phone applications will be integrated into the car’s Mbrace system. By using the phone’s online connection, for example, one can tap their smartphones in New York to unlock a Mercedes in Washington, D.C., the report added.
The Mbrace car assistance service comes free for the first six months for new-car buyers, but it can also be purchased for older Mercedes models for $280 a year for the basic service.
General Motors has thrown its weight behind a legislative proposal to make event data recorders (EDRs) mandatory in all new vehicles.
In a news release, GM said that New Mexico Senator Tom Udall’s proposal to mandate black boxes in cars is crucial in the country’s public safety campaign. The American automaker said crash devices contain important data that could help national databases analyze causes of accidents.
“It is essential that decisions on important safety issues be supported by the best available data, and we are convinced that EDRs can help that process,” Michael J. Robinson, GM’s vice-president of environment, energy and safety policy.
The device is used to record vehicle telemetry, such as speed and driver inputs, has been a fixture in GM cars since 1990 and became a standard equipment in its light-duty vehicles in 1995. Ten years ago, the device allowed for limited public retrieval of the data.
According to Motor Trend magazine, some people view EDRs as incursions to personal privacy. “Making the units mandatory in all new vehicles add fuel to the ‘Big Brother’ fire for many people,” the report said.
EDRs are not mandatory but the data they collect will be standardized by 2013, it added.
German automaker Daimler has signed a joint development agreement with Toray, a leading carbon fiber manufacturer, to produce car parts made of carbon fiber reinforced plastics (CFRP).
Under the agreement, Toray will study how to mass-produce CFRP and handle the design and molding processes of the new materials. Daimler, on the other hand, will be responsible for developing joining technologies, the two companies said in a statement.
Carbon fiber has long been used in race cars because it is lightweight and strong. However, the material is very expensive compared to the commonly used car materials like steel and aluminum.
Daimler earlier said the use of CFRP will help them achieve their goal to reduce the weight of its Mercedes-Benz series by as much as 10 percent to improve the vehicles’ fuel efficiency rating and reduce exhaust gas emissions.
The announcement comes two weeks after its competitor BMW announced in early April that it is making a move toward carbon fiber. BMW signed an agreement with GL Automotive Carbon Fibers to open a carbon-fiber production facility in Moses Lake, Washington, for its MegaCity line of electric vehicles, which will be released in 2013.
Chrysler has reportedly dropped the Sebring name in favor of Nassau for its updated midsized sedan that will be rolled out later this year, according to the Detroit Free Press.
A company spokesman declined to confirm or deny the report, but industry analysts say this could be one of Chrysler’s moves to improve the image of the Sebring, which was criticized for its poor quality and cheap interior.
“Chrysler is desperately looking to restore its credibility with the public, and dropping the Sebring name, long associated with cheap interiors and spotty overall quality, seems a no-brainer,” writes Motor Trend.
Chrysler has in the past named its models the New Yorker, Fifth Avenue, Cordoba, Saratoga, Windsor, and, most recently, the Aspen and Pacifica. Nassau, the capital of Bahamas, may just be an addition to its string of touristy nameplates, MLive.com reports.
The Sebring dates back to the mid-90s when Chrysler launched the “cloud cars,” mid-sized four-door sedans which includes the Chrysler Cirrus, Dodge Stratus and Plymouth Breeze.
In yet another sign of economic recovery, car sales in the U.S. will likely hit 11.4 million units this month, up from 9.3 million in April last year, a Thomson Reuters poll of 12 economists showed.
Though the 22-percent gain still fell short of the 16 million vehicles that automakers saw before the recession, it has put the American auto industry back on track after last year’s bankruptcy filings by Chrysler and General Motors, Reuters reported.
“Consumer confidence is a little bit better,” Hyundai U.S. sales chief Dave Zuchowski told the news provider. “Credit is loosening up a little bit. And there are more buyers out in the marketplace. We’re certainly benefiting from that.”
The gain was largely fuelled by strong sales from Asian brands Hyundai, Nissan and Toyota, which recalled millions of vehicles in recent months, as well as American automakers Ford, Chrysler and General Motors.
Edmunds.com projected a combined sales increase of 35 percent for Hyundai and Kia this month from a year earlier, 51 percent rise for Nissan and 33 percent for Toyota. It also expects sales for Ford to be up nearly 26 percent, Chrysler sales to increase about 19 percent and GM sales to grow by 4.1 percent.
Last year, the U.S. car market sold 10.4 million units, the lowest level since the early 1980s. Industry experts say it could take years before the country surpass the 16 million units it sold in 2007 before the downturn hit the industry.
German automaker BMW has released its factory Motorsport parts catalogs intended for track and racing use to customers in the U.S. for the first time.
“Now, for the first time ever in the United States, you can purchase authentic BMW Motorsport parts to offer true BMW performance, available at select BMW centers. It’s the only way to push your track-approved BMW model to its limits,” the company announced in its website.
The launching of the Motorsports catalogs, which were previously available only in Europe, aims to increase BMW’s impact on motorsports as it competes at the American Le Mans Series through a partnership with the Rahal Letterman Racing Team, the company said in a statement.
The catalogs include parts and components for the Z4 (2009 to current) M3 (1995 to current ) and 3 Series sedan (2006 to current). They feature parts from full-on race engines and body pieces to the smallest O-rings and assorted gaskets.
Motor Trend reported that currently only four BMW dealers in the U.S. have been authorized to handle these parts, which included BMW dealerships in Westmont, Illinois; Atlanta, Georgia; Stratham, New Hampshire; and Solon, Ohio.
“The recall is being conducted due to the potential for premature deterioration of the exterior surface of the hose as a result of prolonged exposure to high under-hood temperatures,” Honda said in a statement.
The announcement comes a day after the National Highway Traffic Safety Administration pointed out that high temperatures under the hood can cause Acura’s power steering hose to crack and leak power steering oil.
In response, Honda is recalling approximately 167,000 Acura TSX models with the 2.4L inline 4-cylinder engine released between 2004 and 2008 in the U.S. The free repair involves installing a new power steering hose, O-ring gasket and fluid, Honda added.
Honda spokesman Chris Naughton said the carmaker had received one report of a minor fire connected to the power steering hose, but there have been no reports of accidents or injuries, the Associated Press reported.
This is the second recall announced by Acura in April. Earlier, it announced the recall of 1,850 2010 ZDX crossovers because of a dashboard material that was cut wrong, which can cause the passenger-side airbag to deploy improperly.
Talk show host Oprah Winfrey has launched a campaign to designate Friday as a “No Phone Zone Day” in cars, joining a chorus of private and public transportation safety groups in vowing not to text or make calls while driving.
Winfrey has asked people in the April 30 episode of her show to sign an online “no phone zone” pledge – a promise not to text text while driving, not text and use hands-free calling, or not text or make calls while driving. The campaign had gathered almost 250,000 signatures by late Friday.
“A call or text isn’t worth taking a life,” Winfrey said in a statement. “We must not allow more mothers and fathers, daughters and sons, sisters and brothers to die before we take action against distracted driving.”
Texting while driving increases the risk of a crash by 20 times, a report from the Virginia Tech Transportation Institute concluded in 2009. California, Connecticut, New Jersey, New York, Oregon and Washington have banned all drivers from using handheld cell phones while driving, according to the Governors Highway Safety Association. Meanwhile, 24 states have laws banning text messaging for all drivers.
The BrandZ Top 100, a survey compiled by the market research company Millward Brown, pegged BMW’s brand’s value at $21.82 billion, higher than Toyota’s $21.77 billion.
Peter Walshe, Millward Brown’s global brand director, told the Automotive News that Toyota will likely bounce back on top once recall issues are addressed and media scrutiny subsides.
“It is likely that Toyota’s brand has suffered further in recent months, but it is a strong brand and is trying hard to overcome the damage through a major communications campaign,” Walshe told the news provider. “All of our evidence shows that strong brands are much more likely to recover from a crisis.”
Rounding up the top 10 list are Honda ($14.3 billion), Mercedes ($13.7 billion), Porsche ($12 billion), Nissan ($8.6 billion), Ford ($7 billion), Volkswagen ($7 billion), Audi ($3.6 billion) and Renault ($3.3 billion).
Japanese automaker Honda has expanded the dealership of its compressed natural gas-powered Honda Civic GX with the recent addition of Oklahoma as a sales base.
Oklahoma became the fourth state in the U.S. to sell the GX, which was launched in California in 2005. Since then, retail sales have expanded to New York in 2006 and Utah in 2009.
“Honda seeks market opportunities for the Civic GX where strong natural gas refueling infrastructure exists,” Elmer Hardy, senior manager at Honda’s alternative fuel division, said in a news release.
KTUL-TV reported that Oklahoma provides a tax credit of up to $2,500 for motorists who buy CNG equipment to fuel their vehicle at home. At the same time, consumers can also claim a 50 percent tax credit for CNG vehicles, such as the Civic GX.
The 2010 Civic GX boasts an EPA rating of 24 mpg city and 36 mpg highway and was named the “greenest vehicle” by the American Council for an Energy Efficient Economy. It is the only OEM-built, CNG-powered passenger car assembled in the U.S.
Subaru will increase its production capacity by 40 percent in its Lafayette, Indiana, assembly plant to meet the growing demand for the newly redesigned Legacy sedan and Outback wagon.
First quarter sales of the two cars in the U.S. more than doubled from last year, with the Outback reaching 19,275 and the Legacy hitting 8,550 sales, the Automotive News has reported.
Fuji Heavy Industries, maker of the Subaru brand, said it plans to produce 140,000 vehicles in the Indiana plant, which currently churns out 100,000 cars a year.
Representatives did not say how the plant will meet the new demand, but Automotive News implied it may draw from capacity currently being used to manufacture Toyota vehicles. The plant has a separate line with a capacity of 100,000 units for the Toyota Camry.
In 2009, Subaru sold about 217,000 vehicles, and the boost in production should increase this year’s figure to at least 230,000, the news provider added.
Consumers may be better off buying cars now as a new study found that the average automobile finance rate dipped to 4.4 percent in March, the lowest rate in the last eight years.
Edmunds.com said Toyota has the lowest average finance rate at 1.9 percent, followed by Mazda (2.5 percent) and Mercury (3.3 percent). Kia claimed the spot with the highest interest rate in March at 7.1 percent.
“Low interest financing is compelling for consumers because those who qualify often enjoy greater savings than they would get from a cash-back offer,” said Jessica Caldwell, a senior analyst at Edmunds.com.
In other trends, Edmunds.com reported that of all luxury brands BMW had the highest average down payment, $13,614, and the shortest average loan term, 52.4 months. Subaru took this spot in the non-luxury category with an average loan term of 60.9 months and highest down payment of $3,911.
Dodge had the industry’s longest average loan term, 67 months, followed by Chevrolet at 66.6 months and Hyundai and Kia at 66.1 months. Scion buyers financed the lowest average dollar amount, $18,978, and the lowest average monthly payment, $348.
General Motors will spend $890 million to upgrade five of its engine and component plants to keep up with demand for the company’s most popular vehicles, including its four core brands Chevrolet, Cadillac, Buick and GMC.
About $400 million will be spent to revamp GM’s powertrain factory in Tonawanda, New York, and $235 million will be spent on the company’s St. Catharines, Ontario plant. The rest will go to engine casting and component production at factories in Defiance, Ohio; Bedford, Indiana; and Bay City, Michigan, the New York Times reports.
The new investment comes less than week after the Detroit-based company repaid a $6.7 billion U.S. loan and announced a $257 million upgrade of its assembly plants in Kansas and Michigan for the next-generation Chevrolet Malibu sedan.
GM aims to build more fuel-efficient engines in response to consumer demand and future federal mileage requirements. Its North American assembly plants work on 24-hour schedules because of spikes in sales after it emerged from bankruptcy using government bailout money. GM’s sales were up 17% though March this year compared to 2009.
Ford vehicles with one to five years on the road are fetching higher resale values during the first quarter of 2010 compared to the same period last year, according to the latest North American Dealers Association auction data.
In a news release, the Dearborn, Michigan-based carmaker reported that its car fleet gained 23 percent year-over-year improvement in resale value, outpacing the industry average by 4 percentage points.
“Ford products have outperformed the overall market, especially in the increasingly important segments of compact cars, midsize cars and crossover vehicles,” said Tom Webb, chief economist at Manheim Consulting. Webb cited the 2010 Ford Taurus, which he said sells 50 percent higher at auction than the 2009 Taurus after one year in service.
Meanwhile, Ford also reported that warranty repair rates have declined by 40 percent globally in the past three years, claiming that Ford, Lincoln and Mercury vehicles now have the “fewest number of defects of any full-line manufacturer.”
Ford reported Tuesday its best quarterly performance in six years with a profit of $2.1 billion. According to the New York Times, the last time Ford earned a quarterly operating profit of $2 billion was in 2004, when it sold nearly 17 million cars in the U.S. Ford expects to sell less than 12 million this year.
More Americans believe that domestic cars are superior to their Asian and German counterparts, a survey conducted by the Associated Press and GfK Roper Public Affairs & Media showed.
Thirty-eight percent of more than a thousand respondents said they think American cars are the best-made vehicles in the world. About one-third chose Asian-made cars, while 15 percent believed German automakers offer top quality vehicles, according to the survey.
Businessweek’s “The Auto Beat” blog said that the result could boost sales of American car makers Ford, General Motors and Chrysler. “All three can capitalize on this newfound respect if they continue to build better models and if, a big if in GM’s case, they can market the cars well,” it said.
The Kelly Blue Book reported that the new figures are “pronounced variations” from earlier polls made well before Toyota‘s recall issues. In 2006, for instance, the AP-AOL poll showed that 46 percent of Americans felt Asian countries had the best in quality with just 29 percent and 17 percent for U.S. and German cars, respectively.
With its topnotch fuel efficiency, solar-powered ventilation system and various high tech features, Toyota‘s 50-mile-per-gallon Prius topped this year’s list of 10 greenest cars.
According to the Kelly Blue Book, the Prius remains the most fuel-efficient car in its class of hybrids, boasting 51 mpg city and 48 mpg highway. Aside from its hybrid powertrain technology, Prius was praised for its glass moonroof with a solar-powered ventilation system, voice-activated navigation and Dynamic Radar Cruise Control with Lane Keep Assist.
“To be considered for the green Top Ten, each vehicle was required to offer fuel economy and carbon dioxide emissions superior to the bulk of vehicles in its class and at the same time provide all the safety, creature comforts and driving enjoyment that would make it pleasant to own,” Kelley Blue Book said in its website.
This year’s list was largely dominated by last year’s collection, but also included two newcomers — the Volkswagen Golf TDI, one of the newest “clean diesels,” and the Chevrolet Tahoe Hybrid, which demonstrates SUV-like features that can co-exist with a hybrid powertrain.
Rounding up the top five are Honda Insight Hybrid (41 mpg), Ford Fusion Hybrid (39 mpg), Volkswagen Golf TDI (34 mpg) and MINI Cooper (32 mpg). Ranked sixth to tenth are the Ford Escape Hybrid (32 mpg), Honda Fit (31 mpg), BMW 335d (27 mpg), Toyota Highlander Hybrid (22 mpg) and Chevrolet Tahoe Hybrid (22 mpg).
The New York Times reported that Toyota will introduce a third-generation Prius in May in line with Toyota’s plan to sell a million hybrid cars in the next few years, from about 250,000 hybrids in 2008.
An online aggregator of financial rate information has reported that many of this year’s auto loan refinance rates are 1 percent to 2 percent lower than they were in April of last year, depending on the length of the refinance loan.
“Refinancing an auto loan may be a good option if you need to reduce your monthly expenses in order to get your finances back on track,” said Tara Baukus Mello, an analyst at Bankrate.com.
While it is ideal not to extend the length of any loan, job loss or other similar situations could urge people to consider refinancing their loans to ease some financial burden, according to the news provider.
For example, a car purchased in April 2008 for $28,000 and financed for five years at 6.53 percent (the national average at the time) requires a monthly payment of about $550. This means the owner currently owes the bank a little less than $18,000.
Refinancing the remaining amount for four years, at the national average rate of 5.38 percent, would drop monthly dues by $133 and the owner would spend just $176 more in interest over the life of the loan, Mello said.
According to a Businessweek report, refinancing an auto loan might be a very good idea in the near future because interest rates remain at historically low levels. “Whether you have a used car loan or a bad credit personal loan, you could probably get the interest rate lowered if you go through a refinance process in the near future,” the report said.
Fueled by the increasing demand for plug-in hybrid and electric cars in the past three years, Japanese automaker Nissan and General Electric have signed a deal to make smart charging technologies a reality.
The collaboration will explore ways to integrate hybrid and electric vehicles with homes and buildings, and will later brainstorm on how these new breed of cars can affect the larger electric grid, the two companies said in a news release.
Nissan, which last week began taking orders for the all-electric Leaf sedan, said the deal is part of its vision is to realize “zero-emission mobility through a holistic approach by by working with various partners in a broad range of industries.”
A blog post by GE scientist Matt Nielsen discussed some challenges in the integration of plug-in vehicles to homes and buildings, including the need to equip homes with the appropriate wiring for car charging and low-cost metering plans from utilities. The research will be conducted at GE’s global research operations in Niskayuna, New York.
According to the New York Times, about 98 percent of the vehicles sold in the U.S. in 2009 were powered by conventional gasoline engines. But many expect this trend to change in the next few years as automakers fill their pipeline with hybrid and electric cars and motorists become more aware of environment-friendly alternatives.