Monthly Archives: July 2010

U.S. may have been too hasty in closing down car dealers

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Posted in Auto Industry News, Chevrolet, Chrysler - DO NOT USE, General Auto News

A new report by the Troubled Asset Relief Program has found that the United States Treasury Department should have carefully considered its decision to order GM and Chrysler to close hundreds of dealerships while the two companies were in the bailout process.

GM and Chrysler both went bankrupt during the financial crisis, forcing the government to step in and take over the companies’ balance sheets. The Treasury Department rejected GM and Chrysler’s plan to close dealerships over a five-year period, calling the measures “too slow,” and instead asked the two automakers to close hundreds of dealerships immediately in an effort to cut costs. Now, many are questioning the decision, as GM and Chrysler have rebounded to the point that they are reinstating many of the dealers.

Special inspector general Neil Barofsky wrote in his recent report that “such dramatic and accelerated dealership closings may not have been necessary and underscores the need for the Treasury to tread very carefully when considering such decisions in the future”

With the closing of so many dealerships, many lightly used cars have found their way onto the pre-owned market. Drivers in areas with a closed GM or Chrysler dealer may want to head to a used car lot in order to find deals and savings.

Toyota and Tesla to work on electric RAV4

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Posted in Auto Industry News, Toyota

Toyota has announced plans to work with electric car company Tesla in order to develop a battery-powered version of its popular RAV4 crossover.

The Toyota-Tesla partnership began when Toyota invested about $50 million in the small company earlier this year. Since then, Tesla successfully went public and began plans to take over Toyota’s closed NUMMI factory in California.

The new electric RAV4 is the first joint venture on a vehicle between the two. Toyota will provide most of the parts for the vehicle, while Tesla will contribute its electric powertrain and battery technology, according to the Los Angeles Times.

Interestingly, the car is not the first electric RAV4. Toyota previously made several limited edition prototypes of the vehicle earlier in the decade, but never commercialized the product for the mass market.

“The Toyota RAV4 EV has been a terrific workhorse for the past decade. Hundreds of the original cars are still running seven to 10 years after manufacture in both fleets and private hands,” Paul Scott, one of the rare owners of the first-generation RAV4 EV, told the news source.

Those who still prefer their vehicles powered by gas may want to consider purchasing a used Toyota RAV4.

What is the APEAL of certain car models?

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Posted in How To

Test drives can only go so far – a driver needs to really have the car for a few months before they can be sure if the car is right for them. For those in the market for a vehicle, JD Power helps buyers arrive at that decision. Their annual APEAL survey (Automotive Performance, Execution, and Layout) is designed to complement their Initial Quality Survey, which tracks problems with a vehicle in the first 90 days. While that is one measure of quality, APEAL looks more at the intangibles, asking recent owners to rate over 80 factors that get to the heart of whether they like the car or not. The results of this APEAL survey tracked 2010 model cars for sale, meaning that many of these vehicles can now be found on the used market.

Following the trend that started in the Initial Quality Survey, American brands posted the biggest improvement in this year’s survery, overtaking foreign cars in average rating for the first time since 1997. The study showed that redesigned vehicles from Ford and GM were among the highest rated models in the poll. Chrysler did not fare as well, but it was enough for the Big Three and their associated brands to top the foreign average.

"Historically, vehicle models achieving high APEAL scores have been shown to generate faster sales, higher profit margins and less need for cash incentives," the study said. "High levels of vehicle appeal also have a strong influence on customer recommendation rates."

Owners may want to rush out and throw down money on these used cars right away. However, the APEAL survey demonstrates the benefits of waiting. By showing patience, finding out which models are highly-rated and performing well without issues, and then waiting for these late-model vehicles to hit the used car market, drivers can save a bundle and get a car they know will be up to snuff.

Porsche took home the crown, as it did in the Initial Quality Survey as well. However, there were major discrepancies between the two results. For example, Land Rovers were last in initial quality, but fifth in APEAL. Jaguar, second in APEAL, was fifth from the bottom in initial quality.

Ford’s Lincoln brand was the best domestic brand, followed closely by GM’s Cadillac. Chevy and Ford placed around the middle of the pack, while Chrysler took last with its Jeep brand, third to last with its self-titled models, and eighth from last for Dodge. Its new Ram truck brand fared the best, but still placed slightly below Chevy and Ford. However, Chrysler has a slew of redesigned models debuting soon.

Ford continued its impressive turnaround by taking top marks in the most categories, with five. It won outright with its Explorer, Expedition, Flex, Fusion and Taurus models.

Other highly-ranked vehicles included the BMW 3 and 5 Series and the Mercedes E- and S-Class.

Man sets fire to used Mercedes

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Posted in General Auto News, Mercedes-Benz

One great thing about buying a used Mercedes is that the brand name will mean that it will always be easy to sell later, and if its truly a classic, it may even appreciate in value. However, one man’s attempts to sell his used Mercedes were dashed when an arsonist allegedly set fire to the vehicle and posted the pictures to Facebook.

Asgard Tarick Gilbert, 36, of Belfast, Maine, has been arrested and charged with felony arson, according to the Bangor News. The owner of the vehicle, a 1982 Mercedes, had been attempting to sell it. Police came upon the blaze and Gilbert snapping pictures on June 28th. Gilbert claimed to the two officers that he had recently discovered the fire.

The officers took down his information as a person of interest in the case. Gilbert later returned to the scene and took pictures of the charred car, posting them on Facebook along with the original photos in an album marked “Warzone.” This caused police to issue a warrant for the seizure of his computer and cell phone.

However, the real break came when police investigated the security tapes of the nearby Belfast Variety convenience store. The tapes show Gilbert on his bike at 12:30 AM, filling a gas can with kerosene before speeding away.

Gilbert is currently being held on $2,000 bail.

BMW updates earnings outlook

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Posted in BMW

Strong sales have caused BMW to update its earnings outlook for the year, as surprising demand for luxury vehicles has caused the market to begin to rebound.

BMW originally predicted sales to increase this year by a single-digit percentile to around 1.3 million vehicles. However, brisk sales in China and demand for its 5-Series model have caused the automaker to revise those statements, instead predicting 10 percent growth and over 1.4 million cars sold, according to BusinessWeek.

Sales of BMW vehicles rose 13 percent during the first half of the year. BMW says that its second quarter results, which it will report on August 3rd will reflect the increased demand.

BMW has gained market share in China, as the company’s vehicles proved popular. The strong surge in demand has caused BMW to ship an additional 10,000 3-Series vehicles than it initially predicted it would sell.

"It’s not just strong sales in China, it’s also the delivery of new models and the effect of cost-cutting steps," John Buckland, an analyst at MF Global UK Ltd, told the news source.

In addition, BMW announced that its redesigned 5-Series sedan was sold out in all markets worldwide.

Those who see themselves in a BMW don’t need to break the bank to do so. It might be possible to find deals on used BMW vehicles by visiting local dealers.

Automakers focusing on gas mileage

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Posted in Auto Industry News, Chrysler - DO NOT USE, General Auto News, Honda - DO NOT USE

Traditionally, automakers only make small changes on models year-to-year, only truly changing the cars with their publicized “redesigns.” However, sometimes automakers make small tweaks to increase a car’s appeal, as they have been doing lately in attempts to improve gas mileage.

Fuel economy has become an important consideration for consumers looking to save at the pump. With that in mind, some automakers are making slight changes to their vehicles in order to improve their EPA-rated mileage, according to the Associated Press.

Honda, for example, has made some slight changes to its popular Accord model for the 2011 model year. Changes to the car’s aerodynamics, gears, and engine friction have increased mileage from 31 to 34 miles per gallon on the highway and 21 to 23 in the city. That puts it in second place of the midsize models for fuel economy, trailing the Hyundai Sonata’s 35 mpg.

Chrysler has also announced plans to make similar changes to its Sebring and Dodge Avenger models, promising large increases to their current ratings of 21 city/30 highway miles per gallon.

Those looking to save money might want to look at fuel efficient used cars, as they will save money not only at the pump, but also at the dealer.

Driver error may be to blame in some Toyota cases

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Posted in Toyota

Toyota is still recovering from its well-publicized problems with unintended acceleration in its vehicles, and a slew of independent consultants, including the government, is testing the vehicles in question in order to determine what caused the issue.

Leaked data from preliminary testing by the National Highway Traffic Safety Administration has shown that driver error, rather than electronics or design flaws, may have been a factor in at least some of the cases, according to USA Today. Electronic data recorders in the vehicle can tell analysts exactly what was happening at the time of the crash. A driver who meant to slam on the brakes may have accidentally hit the gas in the heat of the moment and blamed it on unintended acceleration.

It is unclear how many of the cases were caused by driver error. Toyota has pointed to possible problems with poorly-fitting floor mats and sticky gas pedals, and has disputed the findings of Professor Dan Gilbert, an independent consultant who found that the vehicle’s electronic system may be at fault.

Unintended acceleration in Toyota vehicles has accounted for an estimated 80 fatalities, according to the NHTSA, although that number may drop with the new findings.

Drivers interested in choosing a Toyota for their next vehicle may want to look at used Toyota vehicles, as older models of Corollas and Camrys are known to be unaffected by the problem.

Consultants say Toyota must improve quality control

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Posted in Toyota

Independent consultants have advised Japanese automaker Toyota to begin a full assessment of its quality control procedures in the wake of the company’s massive recalls.

Toyota has faced scrutiny from a number of independent bodies, including the National Highway Traffic Safety Administration, who slapped the company with a $16.4 million dollar fine for failing to respond properly to recalls. The company has vowed to improve its safety, but it has also run into trouble with its independent experts.

E-mails obtained by the Associated Press showed that the company was not pleased with the work of independent hire Professor David Gilbert, whose findings showed that electronics may be to blame in the vehicles’ failings. Exponent, a consulting firm hired by the automaker, was criticized by a House committee for its past results that seemed to always favor the auto industry.

The consultants’ recommended that Toyota beef up their quality controls. Toyota has publicly apologized for the safety issues and plans to spend millions to improve its safety and consumer complaint divisions.

While Toyota sorts out its mechanical issues, prospective car buyers may want to consider a used Toyota, as the early-decade models are well-known for their safety and reliability.

Toyota has recalled over 8.5 million vehicles since October.

Nissan to temporarily halt production

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Posted in Nissan

Nissan has stopped production at four of its five Japanese auto plants, because of a delay in critical parts delivered from a third party. The stoppage of production could result in fewer cars for sale in the Japanese market.

Japanese manufacturer Hitachi said that its engine control unit, an important component of car engines, would be delayed. Although Hitachi supplies other Japanese manufacturers, Nissan is the most affected – 90 percent of Hitachi’s production line was to go to Nissan, according to the Wall Street Journal.

Hitachi likewise blamed the problem on a supplier of integrated circuits, part of the ECU. “The supply of a specific IC chip suddenly declined this month, and the supplier has yet to tell us why exactly this is happening,” managing director Yasuhiko Honda said at a joint press conference with Nissan.

Nissan has not yet ascertained the potential financial impact of the delay, but expects that it will produce 15,000 fewer cars as a result. Hitachi has said that it is working with the supplier to obtain a shipment for late July or August so that production may continue.

Ford and Chrysler are the latest to recall

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Posted in Auto Industry News, Chrysler - DO NOT USE, Ford

In the wake of the massive Toyota recalls, the National Highway Traffic Safety Administration is cracking down on auto companies’ safety defects more than ever. The two latest brands forced to recall vehicles are Ford and Chrysler.

According to Reuters, Ford will recall 33,700 of its Transit Connect commercial vans, due to an interior liner flaw that may not properly protect a driver in case of a crash. The vans are popular among small businesses and similar ventures.

“In the event of a vehicle crash, an occupant could be at increased risk of injury,” the NHTSA summarized in a letter to Ford.

Meanwhile, Chrysler will recall 22,000 of its 2010 model Dodge Nitro, Ram 1500, and Jeep Liberty and Wrangler trucks and SUVs, due to a tube problem that may leak brake fluid.

Those in the market for a vehicle may want to avoid new cars until recalls and defects are sorted out. Small businesses, for example, may opt to buy a used Ford Transit with no history of defects in order to ensure their business runs smoothly and uninterrupted by safety recalls.