Paid Search Advertising (also Pay-Per-Click, PPC) has gained a significant influence in the search engine industry over past couple of years. Whilst a traditional search engine optimisation still remains the online marketing strategy number one, more and more e-marketers discovering the potential of online advertising campaigns. Properly designed and managed, PPC campaign can deliver highly qualified visitors to your online shop. I can put a plan together for you that will leverage you a great ROI!
Quick Overview
Pay-Per-Click (PPC) Search Engines are built on the similar principle as auctions. The difference is that you bid on keywords -- terms people use when they search for stuff on the Internet.
The concept of PPC bidding is rather simple: you buy (= bid on) keywords that relate to your product. The highest bidder gets placed at the top of the search results, the second highest bidder gets the next listing and so on. Every time someone clicks through to your website, you pay the amount you bid on that particular search term. My program only charges fair market value for the word / term what we pay you pay, most everyone else in the market marks up the price of a click!
Advertising with PPC search engines basically gives you two key advantages:
* Cheap and Highly Targeted Traffic
With bidding on keywords that relates to your product or service, you actually pre-qualify the type of visitors you wish to attract. You determine how much you are willing to pay (bid) for the click and you only pay when someone clicks on your ad. This implies that PPC search engines can cheaply direct qualified visitors to your website. We are the experts at LOCAL SEARCH we put buyers in touch with you when they are ready to BUY!
* Fast Exposure, Immediate Profits
Traditional search engines usually take few weeks (sometimes even months) to list your website. If you are having problems to get your website indexed by search engines or if you would like to get a quick results from the search engines than PPC is the best alternative. We will set your website live within a couple of hours (maximum few days) and the impact on your site traffic and sales is practically immediate. If you do not have a website we can build one for you to meet your current and future needs.
* Guaranteed Top Position
Search engine optimisation is the classic method of getting your website on the top of search results for free. Simply said, the process of optimisation involves choosing keywords that are directly related to your website and placing them meaningfully within your pages. However, as easy as this sounds, for an average webmaster this is usually a quite daunting task without any guarantee on the success. This again brings me to PPC as the best solution to gain high rankings on the search result list. Often, by spending just few cents per click, your website can get to the top three positions within 24 hours!
The best-known and most popular PPC Search Engines are Google (www.google.com) Yahoo (www.yahoo.com) MSN (www.msn.com) and SUPERPAGES (www.superpages.com) These four sites account for more than 87% of searches done everyday. Advertising with these industry leaders will get your website lots of exposure and traffic.
Generally, the more popular keyword you choose for bidding the higher is the price. You can start your bid from 1 cent per click and finish paying $5.00 (or more) for very competitive keywords.
Designing Successful PPC Campaigns
The golden rule of PPC bidding is: "Attract highly qualified buyers and keep your bids as low as possible". Since you are paying for each single visitor landing on your website obviously you wish to maximize the effectiveness of your PPC campaign. Let's take a look at some basic guidelines that we use to help you optimise your campaign and ensure your ROI: We provide you with your own dedicated specialist to work on your campaign.
* Determine your bid cost
The calculation of the bid cost (also cost per click) requires a rather complicated formula. For the purpose of this article I mention just a baseline that helps determine how much you can afford to bid:
- Firstly, you need to know the conversion rate of your web site. That means how many unique visitors you need to close one sale. For example, if you need 50 visitors (= clicks) to close 1 sale then your conversion rate is 2%. If your bid is 10 cents per click than one sale has $5 of bidding cost.
- Secondly, you need to know your profit margin. If your profit margin is high enough to justify the cost you can consider increasing the bid and getting a higher position for your ad. This way you may increase the number of clicks through your website and acquire more sales.
- Finally, calculate if the extra sales justify the extra cost and adjust the bid accordingly.
* Focus on highly targeted keywords and phrases
As mentioned earlier, PPC Advertising can deliver cheap and highly targeted traffic to your website. To use this advantage to your benefit it is important to choose wisely the keywords you wish to bid on. The key is to be specific. For example, instead of bidding on "skin care" you can consider bid on "anti ageing herbal treatments". More targeted keywords attract more qualified buyers. It is easier to convert them into paying customers because they found exactly what they were looking for. This strategy is also a big money saver -- more specific keywords tend to be less expensive than the general ones everybody is biding on.
* Customize your advertisements
You will attract more attention from qualified buyers by writing ads specifically for each of keywords you bid on. Speak directly to the type of visitor you want to serve. For example, instead of writing an ad for "pies" you can write "home made pies".
When tailoring your ads to a specific audience, be also sure that you direct your visitors to a page on your website where it's easy for them to buy these items.
* Choose the best position for your advertisement
To be listed first on the search results is not always a smart move. It certainly helps to attract lots of visitors, but may cost you lots of money at the same time. People usually visit first 5 top listings before making a final decision about their purchase. Therefore, it is more profitable to have lower ranking for highly competitive keywords.
Managing PPC Advertising Campaign
You and your product specialist have designed a killer selling ad copy, chosen highly targeted keywords, calculated the maximum you can afford to bid on each of search terms and determined which spot on the search results you wish to secure. Yet, there is no guarantee that your ad always remains on your desired position.
The key to managing the desired position is to adjust your bids correctly in accordance to the PPC market conditions. It's like monitoring shares on the share market -- to get the best deal you need to constantly watch prices and react immediately to any change.
The main factor influencing the price of the bids and your position are your competitors. Let's make few examples of bidding strategies you can consider using in your PPC campaign: assuming, your maximum cost per click is $1.00 and your goal is to secure position #3 at the most effective cost.
Maintain Target Position
Your aim is to target the position #3 however your ad appears on the position #10. Knowing that the current holder of the position #3 pays $0.51 per click you can improve your position and take over his place by bidding $0.52. This strategy sometimes tends to drive up the keyword prices so be aware you don't cross the limit of spending $1.00 per click.
Control your Maximum Cost per Click
As mentioned earlier in this article, the calculation of your maximum bid cost (cost per click) requires statistics about your website. You and your specialist need to figure out how much you are willing to pay maximum of per click. Therefore you should not pursue any positions where the bids are over your limit. To get the most accurate bidding results without having to baby-sit your advertising campaign, your specialist will use our software to monitor your key words and phrases and constantly check your bids and adjust them accordingly to maintain your desired position so that you don't have to be alert 24/7.
These are just a few of the things we give you to help your campaign:
- The ability to create and identify targeted keywords and phrases that convert leads in sales.
- The ability to set the maximum amount your want to bid.
- The ability to compile transparent and comprehensive reports on your keywords, bidding cost, bid position and current bid for each keywords. Plus with your help we can calculate ROI down to the penny.
- The ability to monitor competitor's activity by checking competitors ranking and current bids.
Paid Search Advertising presents an excellent opportunity to immediately address your offers to the proper online audience.
e-mail me today so we can help your customers find you.
Monday, September 15, 2008
Tuesday, September 9, 2008
It's not all about Chrysler for me anymore.
Where We Are Going
The Big Idea
Our Vision:
We will be the nation's best provider of media that connects buyers with sellers
We will be the nation's best provider of media that connects buyers with sellers
The Idea in Action
Our Mission :
We prove our value every day by delivering buyers to businesses, content to consumers and value to investors
We prove our value every day by delivering buyers to businesses, content to consumers and value to investors
The Arc
Our Commitment to Our Constituents:
Businesses: We design advertising programs that deliver high-quality references
Consumers: We deliver relevant product and service information wherever, however and whenever you want it
Employees: We provide opportunity to learn, to grow and to make a difference
Investors: We provide investment value and opportunity for growth
Communities: We are a good neighbor and an upstanding citizen
Businesses: We design advertising programs that deliver high-quality references
Consumers: We deliver relevant product and service information wherever, however and whenever you want it
Employees: We provide opportunity to learn, to grow and to make a difference
Investors: We provide investment value and opportunity for growth
Communities: We are a good neighbor and an upstanding citizen
The Arc in Action
What We Value Most:
Providing value to businesses and consumers
Being fair with employees
Providing value to our shareowners
Delivering products and services we can be proud of
Being accountable for our actions
Providing value to businesses and consumers
Being fair with employees
Providing value to our shareowners
Delivering products and services we can be proud of
Being accountable for our actions
The Employee Expectation
Prove Your Value Everyday:
To your customers
To your co-workers
To our shareowners
To our communities
To yourself
To your customers
To your co-workers
To our shareowners
To our communities
To yourself
Friday, August 29, 2008
It's not just us!
Even the wonderful perfect Toyota is scaling back its sales goals
Toyota lowers its worldwide sales goal Toyota lowered its global sales target for 2009 by 700,000 vehicles to 9.7 million Thursday, showing that even one of the world's most durable automakers is being hurt by rising material costs, a slowing U.S. market and soaring gas prices, Associated Press reports. "We have been going at top speed up to now," President Katsuaki Watanabe told reporters at a Tokyo hotel after announcing the numbers. "It is time to set more cautious targets." Toyota Motor Corp had previously set a 2009 global sales goal of 10.4 million vehicles. The lower target would still be a 2 percent increase from the company's 2008 sales goal of 9.5 million, but even that figure was cut last month from an initial 9.85 million units.
Wednesday, August 27, 2008
For Russia With Love
The Dodge Journey and the Jeep Cherokee are two vehicles being featured at this year's Moscow International Motor Show, a market where Chrysler is experiencing explosive growth.
Looking For Success Behind The US
Chrysler’s position internationally has been diminished significantly since the company’s much publicized divorce from Daimler in 2007. For nearly ten years, the company could depend on Mercedes to helping raise the visibility of its Chrysler, Dodge, and Jeep brands or at least provide the backing that the company needed in order to expand its European presence.
A small time player internationally, Chrysler LLC has suffered more than Ford and General Motors during the current economic downturn as its American competitors are well represented overseas. For Chrysler, the company’s business is 90% North American, which has been a disastrous mix for the automaker in a sour economy.
On Display In Moscow
One bright spot for Chrysler is Russia where the automaker is seeing sales increase at rates much higher than the rest of Europe. All three brands are represented in the former Soviet republic and Chrysler is now the third fastest growing brand in that country.
Coinciding with the 2008 Moscow International Motor Show which starts tomorrow and runs through Monday, Chrysler will be introducing two new models to that market — its Dodge Journey crossover and the Jeep Cherokee.
“Although sales in Russia are growing significantly, Russians are in fact only now starting to discover Chrysler vehicles. Let me remind you that Dodge brand was officially introduced in Russia as recently as two years ago here at the Moscow Motor Show,” says John Stech, CEO – Chrysler Russia. “Now, every second car sold by us in Russia is a Dodge and I am sure that the new cars presented here in Moscow will contribute even further to Russians’ interest in our brands.”
Jeep’s Universal Appeal
The Jeep Cherokee is expected to be well received, it having a history in Russia that spans its near 65 year history as the name for an entire segment of vehicles. Like in the US, where most SUVs at one time were all considered “jeeps” whether built by Jeep or not, the same can be said for Russia.
The Dodge Journey is expected to appeal to Russian families who customarily only have one vehicle per household. The Journey serves multiple purposes not the least being that it can seat up to six people or four with extra storage when the third row seat is folded down. Chrysler believes that the vehicle’s minivan attributes and passenger car efficiency will appeal to a Russian audience.
Looking For Success Behind The US
Chrysler’s position internationally has been diminished significantly since the company’s much publicized divorce from Daimler in 2007. For nearly ten years, the company could depend on Mercedes to helping raise the visibility of its Chrysler, Dodge, and Jeep brands or at least provide the backing that the company needed in order to expand its European presence.
A small time player internationally, Chrysler LLC has suffered more than Ford and General Motors during the current economic downturn as its American competitors are well represented overseas. For Chrysler, the company’s business is 90% North American, which has been a disastrous mix for the automaker in a sour economy.
On Display In Moscow
One bright spot for Chrysler is Russia where the automaker is seeing sales increase at rates much higher than the rest of Europe. All three brands are represented in the former Soviet republic and Chrysler is now the third fastest growing brand in that country.
Coinciding with the 2008 Moscow International Motor Show which starts tomorrow and runs through Monday, Chrysler will be introducing two new models to that market — its Dodge Journey crossover and the Jeep Cherokee.
“Although sales in Russia are growing significantly, Russians are in fact only now starting to discover Chrysler vehicles. Let me remind you that Dodge brand was officially introduced in Russia as recently as two years ago here at the Moscow Motor Show,” says John Stech, CEO – Chrysler Russia. “Now, every second car sold by us in Russia is a Dodge and I am sure that the new cars presented here in Moscow will contribute even further to Russians’ interest in our brands.”
Jeep’s Universal Appeal
The Jeep Cherokee is expected to be well received, it having a history in Russia that spans its near 65 year history as the name for an entire segment of vehicles. Like in the US, where most SUVs at one time were all considered “jeeps” whether built by Jeep or not, the same can be said for Russia.
The Dodge Journey is expected to appeal to Russian families who customarily only have one vehicle per household. The Journey serves multiple purposes not the least being that it can seat up to six people or four with extra storage when the third row seat is folded down. Chrysler believes that the vehicle’s minivan attributes and passenger car efficiency will appeal to a Russian audience.
DAH!
For Korean Cars in the U.S., Cheaper Is Better
Sales of the Kia Sorento, a mid-sized SUV, have fallen nearly 37 percent in the last year.
Sales of the Kia Sorento, a mid-sized SUV, have fallen nearly 37 percent in the last year.
By Jim Henry
South Korean brands Hyundai and Kia have spent years and billions of dollars to add SUVs, crossovers and near-luxury cars to their lineups to live down their reputations for building entry-level cars -- only to find that cheap, and especially fuel-efficient, vehicles are exactly what U.S. buyers want.
Sales have doubled for Hyundai's entry-level Accent.
Not YourFather'sKorean Cars
U.S. sales of tiny models like the Hyundai Accent, the Kia Spectra, and the Kia Rio are up sharply this year. Sure, they're fuel efficient, but it also helps that Hyundai has been largely able to undo its former reputation for poor quality. In July sales of the Accent were nearly double the year-ago month, according to AutoData of Woodcliff Lake, N.J.
But Hyundai's newest model, the Genesis sedan, is aimed at luxury-car shoppers. Starting at $33,000, it debuted in June. With an optional V8, the first V8 ever offered by Hyundai, the Genesis will go for $38,000 suggested retail. That's cheaper than competing V8 models but much higher than any previous Hyundai.
The company hopes to sell about 8,000 units this year, and then about 20,000 a year, says Michael Deitz, manager of product development for Hyundai Motor America in Irvine, Calif. He expects customers to buy about 80% V6 models, and 20% V8s. Right now only V6 models are available. The less fuel-efficient but more powerful V8 goes on sale in October.
A Switch to Unibody
Meanwhile, Kia this month introduces its most expensive model ever: the Borrego, a midsize SUV built on a traditional truck platform instead of a car-like unibody. The trend for the industry, including the next-generation Ford Explorer, is to switch to unibody construction. With its version of the optional V8, the Borrego starts at $31,745.
Kia recognizes what one of its executives called "the elephant in the room," meaning expensive gasoline and the industry trend toward small cars.
"Our head's not in the sand regarding fuel economy. It helps to be the best, or among the best in the segment, when you have consumers studying choices within the segment," says Tom Loveless, vice-president for sales at Kia Motors America. Next year, Kia will add the Kia Soul model for the U.S. market, a squared-off mini-crossover.
Deitz of Hyundai said at an Aug. 12 press introduction for the Genesis in Tarrytown, N.Y., that Hyundai is not abandoning its strength in entry-level models even though it is also introducing more upscale models.
"We're the third-most fuel-efficient brand out there. It's just that there are people who don't know about Hyundai," he said. Deitz cited Environmental Protection Agency figures to show that at a fleet average of 22.7 mpg, Hyundai is only a fraction of a mile per gallon behind U.S. market leaders Honda and Toyota.
Hyundai's Ambitious Plans
Hyundai and Kia both belong to Hyundai Group, which bought control of Kia in 1999. The brands share engines and some components but are still largely separate. Kia is the smaller partner in terms of auto sales, both in the U.S. market and in the domestic South Korean market.
Hyundai Group's big plans for the U.S. market have been dented but not killed by the present sales downturn. Its small cars are selling well this year, but as with other carmakers, sales are way off for its SUVs and minivans.
Kia said earlier it intended to double sales in North America from 2006 to 2010. That time frame has inevitably been pushed back, since sales in 2007 were only 3.8% ahead of 2006, but Kia hasn't dropped the goal, at least not publicly. If that sounds like a lot, consider that Kia's U.S. sales already more than tripled since 1998, to 305,473 in 2007.
Hyundai has been more careful not to put a number publicly on its long-range targets, but the carmaker nearly tripled its U.S. sales since 1999, to 467,009 in 2007. Hyundai is now the No.7-selling brand in the U.S., behind Toyota, Chevrolet, Ford, Honda, Dodge, and Nissan, but ahead of the Chrysler brand. Hyundai and Kia combined would still be No.7 behind Nissan.
Hopes for Global Growth
Hyundai Group is no less aggressive globally. By 2014 the group is expected to more than double its factory capacity from 2001 levels to about 6.7 million, including joint ventures in China and growing capacity in North America, South America, and Europe, according to consulting firm CSM Worldwide of Northville, Mich.
The group's expansion plans are "very, very hyper-aggressive," says Jeff Schuster, executive director of global forecasting for J.D. Power & Associates of Westlake Village, Calif.
"They don't take a step approach, where they focus one area, wait, and then go to another area. They take a buckshot approach. In mature markets like the U.S., they are planning huge expansion. They are also growing swiftly in developing markets, like China. They are in Eastern Europe and through there, they are spilling into Western Europe," he says.
Schuster says that besides the scale of Hyundai's growth itself, he's amazed the group has been able to grow and improve product quality at the same time, something that's tough to do. Some Hyundai and Kia models are among the leaders in J.D. Power quality surveys in the U.S. That would have been hard to imagine in the late 1980s. When Hyundai was first introduced to the U.S. market in 1986, its quality was terrible.
Moving Up the Ranks
"Hyundai in particular is one of the few manufacturers to have had a second chance at life, here in the U.S., anyway. Their quality problems, issues, in the mid- to late-80s essentially led to them leaving the market, but they have turned it around. They did it with long warranties, and they certainly did it with price," Schuster says.
Hyundai has a $1 billion assembly plant in Montgomery, Ala., which builds the Santa Fe crossover SUV and the Sonata midsize sedan. It started production in 2005. Kia is building a $1 billion assembly plant in West Point, Ga., to build the next-generation Kia Sorento SUV starting in 2010, and other models to be named later. Each factory can build up to 300,000 vehicles a year.
Hyundai's Deitz says that sooner or later, the company will move up the ranks of global automakers: "Consumers are slowly becoming aware of it, but Hyundai is one of those big brands out there."
Say it isn't so
NEW YORK -- Chrysler LLC said Wednesday it is weighing options for its iconic Dodge Viper sports car, which could include a sale of the nameplate.
The Auburn Hills, Mich., automaker is mulling strategic options for the Viper, and has been approached by third parties "interested in exploring future possibilities with Viper," Chairman and Chief Executive Bob Nardelli said in a statement.
Chrysler spokesman Todd Goyer declined to name the parties. He said the review is part of a move toward focusing on Dodge's core nameplates.
"Obviously, we want to ensure a strong future for the Viper, but as we focus on the core business we'll listen to people who have expressed interest," Goyer said in an interview.
He said the strategic review was for Viper alone, and added the company was simply reviewing options and no transaction might occur at all.
The review comes as Chrysler and other automakers grapple with a broader industry downturn brought on by a weak economy, high gas prices and slumping demand for large autos. Chrysler's U.S. sales are down 23 percent for the year while industrywide sales have declined 11 percent.
Chrysler has expressed interest in asset sales in the past as it copes with the downturn. Earlier this month, Vice Chairman Tom LaSorda said the company has identified more than $1 billion in "nonearning" assets that it intends to sell to generate cash.
Chrysler, which went private in August after private-equity firm Cerberus Capital Partners LP bought an 80.1-percent stake in the company, is not required to report financial results. However, it has said it's performing ahead of its own expectations, with $11.7 billion in cash on hand at the end of June and earnings of $1.1 billion in the first half of the year before interest, taxes, depreciation and amortization.
Goyer declined to say how much the nameplate might be worth. However, the Viper line, a high-end hot rod nameplate that has been part of the Dodge lineup since 1992, makes up just a fraction of Dodge's overall sales. Dodge has sold 682 Vipers so far this year, compared with more than 62,000 Chargers and 150,000 Rams sold.
Moreover, the Viper has its own assembly plant in Detroit and a manufacturer's suggested retail price of $88,125 on its 2008 model. The nameplate may be past its prime given that small scale and niche focus, said Mike Jackson, director of North American vehicle forecasts for CSM Worldwide.
"Chrysler has some greater priorities to tend to," Jackson said. "The market has changed significantly. Competition within that premium luxury category only intensifies, and as a result, it really puts something like the Viper at a competitive disadvantage from the standpoint that its obviously a very niche focus with limited scale."
In addition, the brand's designer, Trevor M. Creed, is retiring at the end of this month, Chrysler has said. Creed, 63, also designed the Challenger, Ram and Chrysler PT Cruiser.
The Auburn Hills, Mich., automaker is mulling strategic options for the Viper, and has been approached by third parties "interested in exploring future possibilities with Viper," Chairman and Chief Executive Bob Nardelli said in a statement.
Chrysler spokesman Todd Goyer declined to name the parties. He said the review is part of a move toward focusing on Dodge's core nameplates.
"Obviously, we want to ensure a strong future for the Viper, but as we focus on the core business we'll listen to people who have expressed interest," Goyer said in an interview.
He said the strategic review was for Viper alone, and added the company was simply reviewing options and no transaction might occur at all.
The review comes as Chrysler and other automakers grapple with a broader industry downturn brought on by a weak economy, high gas prices and slumping demand for large autos. Chrysler's U.S. sales are down 23 percent for the year while industrywide sales have declined 11 percent.
Chrysler has expressed interest in asset sales in the past as it copes with the downturn. Earlier this month, Vice Chairman Tom LaSorda said the company has identified more than $1 billion in "nonearning" assets that it intends to sell to generate cash.
Chrysler, which went private in August after private-equity firm Cerberus Capital Partners LP bought an 80.1-percent stake in the company, is not required to report financial results. However, it has said it's performing ahead of its own expectations, with $11.7 billion in cash on hand at the end of June and earnings of $1.1 billion in the first half of the year before interest, taxes, depreciation and amortization.
Goyer declined to say how much the nameplate might be worth. However, the Viper line, a high-end hot rod nameplate that has been part of the Dodge lineup since 1992, makes up just a fraction of Dodge's overall sales. Dodge has sold 682 Vipers so far this year, compared with more than 62,000 Chargers and 150,000 Rams sold.
Moreover, the Viper has its own assembly plant in Detroit and a manufacturer's suggested retail price of $88,125 on its 2008 model. The nameplate may be past its prime given that small scale and niche focus, said Mike Jackson, director of North American vehicle forecasts for CSM Worldwide.
"Chrysler has some greater priorities to tend to," Jackson said. "The market has changed significantly. Competition within that premium luxury category only intensifies, and as a result, it really puts something like the Viper at a competitive disadvantage from the standpoint that its obviously a very niche focus with limited scale."
In addition, the brand's designer, Trevor M. Creed, is retiring at the end of this month, Chrysler has said. Creed, 63, also designed the Challenger, Ram and Chrysler PT Cruiser.
Monday, August 25, 2008
Tweak Older Vehicles to Boost Mileage
Automakers tweak older vehicles to boost mileage
As gasoline stays near $4 per gallon and U.S. consumers continue to shift from trucks and sport utility vehicles to more efficient models, many automakers are tweaking their older models between model years to boost gas mileage.
In the 2009 model year, the Detroit Three are making multiple changes. But their biggest Japanese competitors, Honda Motor Co. and Toyota Motor Corp., say they aren't making changes in part because they already are using some of the technology.
Some of the models that are seeing improvements:
Chrysler LLC:
_Chrysler Sebring and Dodge Avenger with four cylinders, highway: Up from 30 miles per gallon to 31.
_Jeep Grand Cherokee, two-wheel-drive with 3.7 liter V-6: Up from 15 mpg city and 20 highway to 16 and 21.
_Jeep Commander, two-wheel-drive 3.7-liter V-6: Up from 14 mpg city and 19 highway to 15 and 20.
Ford Motor Co.:
_Ford Escape and Mercury Mariner, two-wheel-drive, four-cylinder engines: Up 2 mpg on the highway to 28.
_Ford Fusion and Mercury Milan, two-wheel-drive, four-cylinder, automatic transmission: Up 1 mpg on the highway to 29.
_Ford Explorer V-8, two-wheel-drive: Up from 13 mpg city and 20 highway to 15 and 21.
General Motors Corp.:
_Chevrolet Cobalt, Pontiac G5 XFE: Up 1 mpg on the highway to 37.
_Chevrolet Malibu, Saturn Aura, Pontiac G6 with four-cylinder engines and six-speed transmissions: Highway mileage up 1 to 3 mpg depending on model, to 33 mpg.
_Chevrolet Silverado, GMC Sierra XFE pickups with 5.3 liter V-8, six-speed automatic transmission: Up from 14 mpg city and 20 highway to 15 and 21.
Sources: Automakers, U.S. Environmental Protection Agency Web site.
DETROIT -- In a normal year, the 2009 Chevrolet Cobalt wouldn't be any different than the 2008 model, save for a few minor cosmetic changes. But this is far from a normal year.
With gasoline still hovering around $4 per gallon, many manufacturers are making far more than the usual tweaks to cars and trucks between model years to squeeze out one or two more miles per gallon and catch customers who increasingly rank fuel economy as a top factor when buying a vehicle.
Automakers say you can expect more of the same as they roll out new technology without waiting for full vehicle updates.
"Fuel economy is very important," said Greg Peterson, General Motors Corp.'s vehicle performance manager for compact cars, including the Cobalt. "That is one of the drivers in the changes that we made."
In the high-mileage version of the Cobalt and its Pontiac sister, the G5, engineers varied the intake and exhaust valve timing to make the 2.2-liter four-cylinder engine burn fuel more efficiently. They arranged with Goodyear Tire & Rubber Co. for tires with lower rolling resistance, and they changed the gear ratios of the five-speed manual transmission so the engine revs more slowly at highway speeds.
The result: an extra mile per gallon on the highway, boosting the Cobalt and G5 XFE models to an Environmental Protection Agency estimated 37 mpg.
GM's competitors also were busy tweaking existing vehicles between model years.
Ford Motor Co. engineers added a six-speed automatic transmission, electric power steering and variable valve timing to the Escape and Mercury Mariner small sport utility vehicles to get another two miles per gallon on the highway.
The four-cylinder, two-wheel-drive version will get 28 mpg, said spokesman Said Deep, yet the 2009 four-cylinder accelerates as quickly as the 2008 Escape V-6.
Changes were made in other models to get similar improvements, Deep said.
Six-speed transmissions, which are used by most automakers, make vehicles more efficient as they start and stop in the city. On the highway, they also require fewer revolutions per minute, increasing efficiency. Electric power steering reduces drag on the engine by removing the belt that powered the old hydraulic system.
At Chrysler LLC, engineers took similar measures on several models but also recalibrated gas pedals, changed to more efficient air conditioning compressors and tweaked transmission shift intervals to make them more efficient.
For instance, Chrysler was able to push the highway mileage of the Sebring and Avenger midsize sedans to 31 mpg, up from 30.
"These are things that we can do right now for the customer," said spokeswoman Sue Keighron. "They may have been changes that we would have made, but not necessarily as quickly as we are doing now."
Honda Motor Co. and Toyota Motor Corp., which have led the Detroit automakers in fuel economy in recent years, each said they weren't making similar changes to existing models, partly because they're already using some of the new technology.
"Honda's been a fuel economy leader for an entire generation because we bake in good fuel economy at the design stage," said spokesman Ed Miller.
The company does make changes to existing vehicles between model years when technologies are developed, Miller said. The Odyssey minivan V-6 engine, for example, was given the ability to work on three, four or six cylinders between the 2007 and 2008 model years, Miller said.
With the U.S. auto market continuing its shift from trucks and SUVs to more efficient cars and car-based crossovers, automakers say they'll keep adding technology from year to year to keep making their cars more efficient.
GM worked within an existing older design on the Cobalt and G5 to drive its mileage to what the company says is a leader among comparably equipped cars in the subcompact class.
The 2009 Toyota Corolla with a 1.8-liter four-cylinder engine is rated at 35 mpg on the highway. EPA mileage estimates for Honda's 2009 cars aren't yet available. "We did everything we could in calibration," GM's Peterson said. "We just really paid attention to detail in fuel economy."
And when new models come out, look for more dramatic improvements. GM, for instance, says the Cruze, the Cobalt's replacement coming in the second half of 2010, will get around 45 mpg on the highway.
Although the gains may seem small between model years, they will add up over time, the automakers say.
"All these little things, you start to get a half percent here, a percent here. You add these up, its that attention to detail, that's what's given some of our competitors in the past -- the Japanese -- an advantage," Deep said. "We've combined all that. We're going to overtake them or equal them."
Extended Cab to Extend Ram's Reach
PONTIAC, MI – Dodge dealers can’t seem to agree on the ’09 Ram pickup’s strongest selling feature, but Chrysler LLC is pointing to first-time extended-cab availability as the truck’s prime attraction.
“We’re playing in a space where we’ve never played before,” says Frederic DePerez, senior manager-sales and product training for Chrysler Academy, the auto maker’s in-house dealer-education organization. “That’s market share for us.”
How so? Even though the fullsize pickup market is sagging under the weight of volatile gasoline prices, demand for “crew-cab” models as Chrysler calls them, remains strong, DePerez says.
Through first quarter, extended-cab models, as defined by Ward’s segmentation, accounted for about one-third of fullsize pickup production. Among Chevrolet Silverados, nearly 40% of the builds were extended cabs. Toyota Tundra take-rates approached 68%.
See related content: ’08 Model U.S. Domestic Light Truck Production by Body Style
Without an extended-cab offering, the current Ram maintained its long-standing third-place sales ranking among fullsize pickups through July, according to Ward’s.
“A lot of (Ram sales) are going to be conquest,” DePerez says.
Styling is key selling feature of ’09 Dodge Ram, some dealers say.
The Silverado appears to be Dodge’s prime target. At a dealer-training event here, Chrysler reminds that the Chevy, redesigned for 2006, is the “oldest” truck in the segment.
And it doesn’t hurt that Ford Motor Co. has delayed the launch of its redesigned-for-’09 F-150 in a bid to whittle down ’08-model inventories.
“We’re shooting for ‘Truck of the Year,’” DePerez adds. “We want this truck to win every single award out there. (Ford) might be out of the running.”
Don’t count on it.
“You bet we will be out in time for (awards) consideration,” says Ford spokesman Said Deep.
Related Stories
’09 Ram Lacks New Feature Out of the Box; Management, Dealers Unfazed
Dodge Turns Over New Leaf With ’09 Ram
Other Ram upgrades include a new version of Chrysler’s iconic Hemi V-8 engine, beefed up to the tune of 390-hp; a breakthrough coil-spring rear suspension; aggressive styling with deceptively slippery drag coefficient of 0.42; a stylishly appointed interior; and unique storage solutions capable of accommodating everything from beverages to golf bags without comprising passenger comfort or conventional cargo-carrying.
What will resonate best with consumers?
“Besides the motor being jumped up? The interior,” says Chad Waters, sales representative at Charlie’s Dodge in Toledo, OH.
Al Johns of Dick Scott Dodge in Plymouth, MI, disagrees. Johns cites the new sheet metal. “As well as Rambox in the back,” he adds.
Available on up-trim levels, Rambox is a lockable dry-storage system built into the side rails of the truck’s cargo bed. Never mind that it won’t be available at launch.
“I can deal with anything,” Johns says. “You have to.”
Rams equipped with Rambox will be built at Chrysler’s pickup plant in St. Louis, which begins production 20 days after the lead plant in Warren, MI.
DePerez admits dealers would prefer to see such a unique feature arrive with the first transport, but there’s been no significant backlash. “I haven’t heard anything,” he says.
DePerez is unfazed by the flight of personal-use buyers who, stung by high pump prices, have traded down for smaller, more fuel-efficient vehicles.
“(They) won’t come back because of high gas prices, the economy,” he says. “But many people are true truckers. (Pickup ownership) is a lifestyle for them.”
Such core customers will have something special awaiting them in the Dodge showroom, DePerez claims.
Meanwhile, Johns discourages the notion that a more refined Ram will somehow alienate the buyer who needs a work truck.
“I did construction for 20 years,” he says. “(The new Ram is) going to pull everything I’d ever need. And I used to pull about eight grand around in tools and equipment.”
The new truck’s maximum payload is estimated at 1,850 lbs. (839 kg), while its tow rating is set at 9,100 lbs. (4,128 kg).
The work-truck buyer “wants payload, wants seating for four,” Johns says, adding the comfort afforded by interior and suspension upgrades is more than welcome.
“He’s in (the truck) all day,” Johns says. “Do you want to get beat up while you’re working all day?”
“We’re playing in a space where we’ve never played before,” says Frederic DePerez, senior manager-sales and product training for Chrysler Academy, the auto maker’s in-house dealer-education organization. “That’s market share for us.”
How so? Even though the fullsize pickup market is sagging under the weight of volatile gasoline prices, demand for “crew-cab” models as Chrysler calls them, remains strong, DePerez says.
Through first quarter, extended-cab models, as defined by Ward’s segmentation, accounted for about one-third of fullsize pickup production. Among Chevrolet Silverados, nearly 40% of the builds were extended cabs. Toyota Tundra take-rates approached 68%.
See related content: ’08 Model U.S. Domestic Light Truck Production by Body Style
Without an extended-cab offering, the current Ram maintained its long-standing third-place sales ranking among fullsize pickups through July, according to Ward’s.
“A lot of (Ram sales) are going to be conquest,” DePerez says.
Styling is key selling feature of ’09 Dodge Ram, some dealers say.
The Silverado appears to be Dodge’s prime target. At a dealer-training event here, Chrysler reminds that the Chevy, redesigned for 2006, is the “oldest” truck in the segment.
And it doesn’t hurt that Ford Motor Co. has delayed the launch of its redesigned-for-’09 F-150 in a bid to whittle down ’08-model inventories.
“We’re shooting for ‘Truck of the Year,’” DePerez adds. “We want this truck to win every single award out there. (Ford) might be out of the running.”
Don’t count on it.
“You bet we will be out in time for (awards) consideration,” says Ford spokesman Said Deep.
Related Stories
’09 Ram Lacks New Feature Out of the Box; Management, Dealers Unfazed
Dodge Turns Over New Leaf With ’09 Ram
Other Ram upgrades include a new version of Chrysler’s iconic Hemi V-8 engine, beefed up to the tune of 390-hp; a breakthrough coil-spring rear suspension; aggressive styling with deceptively slippery drag coefficient of 0.42; a stylishly appointed interior; and unique storage solutions capable of accommodating everything from beverages to golf bags without comprising passenger comfort or conventional cargo-carrying.
What will resonate best with consumers?
“Besides the motor being jumped up? The interior,” says Chad Waters, sales representative at Charlie’s Dodge in Toledo, OH.
Al Johns of Dick Scott Dodge in Plymouth, MI, disagrees. Johns cites the new sheet metal. “As well as Rambox in the back,” he adds.
Available on up-trim levels, Rambox is a lockable dry-storage system built into the side rails of the truck’s cargo bed. Never mind that it won’t be available at launch.
“I can deal with anything,” Johns says. “You have to.”
Rams equipped with Rambox will be built at Chrysler’s pickup plant in St. Louis, which begins production 20 days after the lead plant in Warren, MI.
DePerez admits dealers would prefer to see such a unique feature arrive with the first transport, but there’s been no significant backlash. “I haven’t heard anything,” he says.
DePerez is unfazed by the flight of personal-use buyers who, stung by high pump prices, have traded down for smaller, more fuel-efficient vehicles.
“(They) won’t come back because of high gas prices, the economy,” he says. “But many people are true truckers. (Pickup ownership) is a lifestyle for them.”
Such core customers will have something special awaiting them in the Dodge showroom, DePerez claims.
Meanwhile, Johns discourages the notion that a more refined Ram will somehow alienate the buyer who needs a work truck.
“I did construction for 20 years,” he says. “(The new Ram is) going to pull everything I’d ever need. And I used to pull about eight grand around in tools and equipment.”
The new truck’s maximum payload is estimated at 1,850 lbs. (839 kg), while its tow rating is set at 9,100 lbs. (4,128 kg).
The work-truck buyer “wants payload, wants seating for four,” Johns says, adding the comfort afforded by interior and suspension upgrades is more than welcome.
“He’s in (the truck) all day,” Johns says. “Do you want to get beat up while you’re working all day?”
Thursday, August 21, 2008
2009 Jeep Patriot
The Jeep Patriot, like the Compass, brings Jeep styling to the Caliber platform — but, unlike the Compass, it also brings Jeep capabilities. With styling similar to the 2008 Liberty, the Jeep Patriot is close in specs (save for the approach angle) but has far better gas mileage and a lower price. Testers have been surprised by its rock-climbing, trail-traversing, and stream-crossing abilities. The body is sized very closely to the Jeep Cherokee.
Numerous changes have been made to the Patriot’s interior, with new chrome accents, a carpeted load floor, illuminated cupholders, new MyGIG radios, soft-touch armrests, a new instrument panel, new door trim, and a new center console; the 2.4 PZEV engine is now on all front wheel drive models with the customer-preferred option packages. This addresses the major shortfalls of the Patriot and should make it much more popular if the word goes out. We only released these images because 2009 Jeep Patriots started showing up on dealer lots and other outlets have already released images. We may have more detail and photos after September 1.
Numerous changes have been made to the Patriot’s interior, with new chrome accents, a carpeted load floor, illuminated cupholders, new MyGIG radios, soft-touch armrests, a new instrument panel, new door trim, and a new center console; the 2.4 PZEV engine is now on all front wheel drive models with the customer-preferred option packages. This addresses the major shortfalls of the Patriot and should make it much more popular if the word goes out. We only released these images because 2009 Jeep Patriots started showing up on dealer lots and other outlets have already released images. We may have more detail and photos after September 1.
Numerous package changes were also made, mainly taking free-standing options and putting them into groups to dramatically cut the number of possible unique combinations. This should lower costs and raise quality as building Patriots becomes somewhat simpler. The only shortfall as a result is a group of features being moved from standard equipment on the Limited to a convenience group — the computer display, garage door opener, and auto-dimming rear-view mirror. This should affect a fairly small number of people, because most buyers went with the Sport, and very few got the Limited without the options package.
Wednesday, August 20, 2008
Ezra Dyer Quote
I just returned from the ride and drive introducing me to the new 2009 Dodge Ram. Wow, while I was trying to put into words what a KICK-ASS truck this is going to be I came across an article in Esquire Magazine and I can't put it in any better terms."BUT A KICK-ASS TRUCK ASIDE
HERE'S THE THING
I LIKE ABOUT THE DODGE:
THE WORLD NEEDS BAD GUYS.
SURE EVERYONE CAN SING A CHEERY CHORUS ABOUT A ROSY FUTURE, IN WHICH CARS RUN ON JOY AND GOODWILL AND MILEAGE IS MEASURED IN SMILES PER GALLON. BUT
WHEN THE APOCALYPSE COMES,
I WANT A DODGE."
Saturday, August 9, 2008
HOLY %&^* look out Vette
First Drive: 2008 Dodge Viper SRT10 ACR
Posted Aug 8th 2008 7:55PM by Drew PhillipsFiled under: Supercars, Dodge, First Drive
I have to admit that I'm biased when it comes to the Dodge Viper. I've had a soft spot for the venomous snake since the GTS coupe hit the streets in 1996. The aggressive design, powerful 8.0-liter V10 with 450 horsepower (doesn't sound like much now, but it sure seemed like a lot then), and the blue paint scheme with white racing stripes were the ideal combination for my dream sports car. I'm going to be that guy at the 2030 Barrett-Jackson purchasing a mint, low-mileage, numbers-matching 1996 or 1997 Dodge Viper GTS, and, of course, you'll be the one watching on SPEED commenting how I'm paying way too much for a classic American muscle car.
My personal fantasy aside, the Viper has made a lot of progress since then. Some of its raw, uncivilized nature had been removed when a more refined suspension and modern features like ABS brakes were added in 2003. The V10 engine was updated, getting a bump in displacement to 8.3 liters and an increase of 50 horsepower. Its redesign in 2003 also saw the Viper's aggressive look somewhat tamed, with less curves and the absence of a coupe. My obsession with the Viper waned, even with the re-introduction of the coupe in 2006 and the upgrade to 600 horsepower in 2008. The current SRT10 will outperform the old GTS any day, but there is a pure aggressiveness and brutality about the original Viper that the newer versions just don't have.
That is, of course, until the introduction of the ACR (American Club Racer) version at last year's LA Auto Show. It's by far the most potent production Viper ever built, and for me it was love at first sight. The front splitter, asymmetrical stripe, and massive rear wing make the ACR the most aggressive looking Viper by far. In fact, it makes the previous generation ACR that was built from 1999-2002 look downright civilized.
So what makes the new ACR so special? Even the slightest glance will tell you this is no ordinary Viper. This particular car came in Viper Black with the unique two-tone paint scheme. The ACR can also be ordered in Viper Red, Viper Violet, Viper Bright Blue Metallic and Viper Very Orange, with only the Black and Red having the option of the two-tone paint. I haven't seen the ACR in anything but Red or Black, and can't imagine ordering it any color combo besides the one seen here.
But enough about paint schemes; the ACR is about one thing and one thing only: functionality. More specifically, putting down all that power from the 8.4-liter V10 to the pavement. To do this, the SRT team focused on aerodynamics, the result of which can be seen at both ends of the car. Up front is a carbon fiber splitter and dive planes that have been specially designed to increase downforce and reduce drag. An extension for the front splitter can also be added for increased aerodynamics at the racetrack. At the rear is an adjustable wing also made of carbon fiber that was specially formed using Computational Fluid Dynamics. So just how much downforce does the ACR produce? Try 1,000 pounds at 150 mph. That's ten times what the standard Viper coupe produces.
Additional traction is provided by massive Michelin Pilot Sport Cup tires (295/35ZR/18 front, 345/30ZR/19 rear) that are just barely approved for street use. The ACR also benefits from a track-tuned suspension consisting of KW adjustable coilovers and a stiffer front stabilizer bar. The coilovers can be adjusted without removing the wheels, which means that making the switch between street and track settings is an easy task.
In addition to the fine-tuned suspension and aerodynamics, the ACR also benefits from lightweight components, particularly in the all-important area of rotating mass. Lightweight forged aluminum wheels knock off a few pounds, as do the two-piece Stoptech brakes for a total savings of 40 pounds. An optional hard-core package doubles that amount with the removal of the audio system, underhood silencer pad, trunk carpet, and tire inflator.
With so many go-fast goodies on board, I was dying to get behind the wheel of the ACR. Unfortunately, none of us Autobloggers have been able to convince Dodge to hand over a Viper to review, so our chances of nabbing an ACR were slim to none. While we haven't stopped pestering Dodge, we decided to try and find an owner who might let us get behind the wheel, and our search led us to the ViperAlley.com web site and forums. Fortunately, a member in Southern California had recently taken delivery of a brand new ACR and was willing to let us use the car for a photoshoot and get some driving impressions.
After meeting up with the owner and taking a few hours to get all the necessary photos, it was time to take the Snake for a ride. Despite my previous knowledge of the hot sidepipes and the large warning on the door sill, I still managed to singe the hair on my legs while entering the car. Once inside, the ACR is quite comfortable. It doesn't look too different than a normal Viper, especially since this owner decided to retain the sound system. The only difference is the strip of red leather on the steering wheel that is a continuation of the red stripe on the outside of the car. My only wish is that Dodge would have included 5-point harnesses like they did on the previous ACR. There's more than enough room for my 5'8" frame, and although the seats are fixed, taller drivers can easily fit due to the adjustable pedals.
The red start button behind the shifter brings the V10 to life. There's enough torque at idle to get the car going without even touching the throttle, and I'm not about to put the car sideways so I take off with minimal throttle. As I get up to speed I'm pleasantly surprised that the ACR is quite streetable. I was expecting to feel every pebble in the road, but the suspension is relatively compliant. The clutch is lighter than expected, and not much effort is required to move the shifter that changes gears smoothly and precisely. While I probably wouldn't recommend the ACR for a road trip, the owner picked up the car at a dealership in Blair, Nebraska and drove it all the way home to Southern California with no complaints. That should tell you something.
But that doesn't mean the Viper is tame by any means. Dip into the throttle and the ACR roars to life. The exhaust emits a wonderful, deep sound that could only come from a Viper V10. This car eats up the road both deceptively quick and with a brutality that borders on being vicious. I know the car is amazingly capable, but it still manages to exceed my expectations. The tires provide limitless grip, although I freely admit I wasn't close to discovering the ACR's full handling potential. The steering also proved to be responsive and direct with plenty of feedback.
While my short drive gave me just a hint of the ACR's performance, it would take a full day at the track to explore its limits. What I do know is that the Viper has returned to its glory days of being the biggest and baddest street machine on the road. Dodge has created something special with the ACR, and it's a steal at under $100,000. I can't imagine a car that would provide more thrills at anything close to this price tag. But then again, I'm biased.
Tags: 2008, 2008 Dodge Viper ACR, 2008 Dodge Viper SRT10, 2008 Dodge Viper SRT10 ACR, 2008DodgeViperAcr, 2008DodgeViperSrt10, 2008DodgeViperSrt10Acr, ACR, Dodge, Dodge Viper, Dodge Viper ACR, DodgeViper, DodgeViperAcr, featured, Viper
Harold Zeigler
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"Confessions of an Auto Finance Manager"
Dealership Finance Secrets Revealed by Edmunds.com
“Confessions of an Auto Finance Manager” Guides Consumers Through Hazardous Last Step in the Purchase Process. SANTA MONICA, Calif.--(BUSINESS WIRE)--The auto finance manager’s office, where most vehicle purchases are finalized at dealerships, is a treacherous place for consumers. Many enter with a great deal only to end up getting fleeced. Edmunds.com, the premier online resource for automotive information, has followed up on the success of “Confessions of a Car Salesman” with “Confessions of an Auto Finance Manager.” The new exposé reveals numerous auto finance strategies that can rob consumers and drive up dealership profits.
“The auto finance process is extremely complicated and foreign to most consumers,” said Philip Reed, Senior Consumer Advice Editor for Edmunds.com, and co-author of the new series. “After negotiating a fair price with a salesperson, consumers are forced to face the auto finance manager who presents an array of confusing options and financing choices. It’s no surprise consumers often make poor decisions in this environment.”
Packed with real life-stories and back room secrets, “Confessions of an Auto Finance Manager” reads like a novel while providing vital self-defense strategies for consumers.
“Confessions of an Auto Finance Manager” advises consumers to do the following:
Get a pre-approved loan before entering a dealership or, at the minimum, know your credit score and interest rates you qualify for.
Finance managers have access to wholesale lending rates but often present a higher interest rate to consumers in order to increase dealership profits.
Don't buy unnecessary and overpriced add-ons and avoid falling for "menu selling."
Finance managers may only offer consumers financing in a package with other add-ons, including extended warranties and paint protection. Consumers are often tempted to select an entire package even though they may not want or need any of the add-ons.
Know the market value for the vehicle you are interested in purchasing.
Consumers can protect themselves from overpaying by knowing a reasonable purchase price for the vehicle. Edmunds.com's True Market Value(R) is a resource for this information.
“Auto finance managers generate enormous profits for a dealership and are some of the highest paid employees,” said Reed. “They profit directly from consumers’ lack of knowledge.”
More detailed guidelines for successful navigating the auto finance process are available in “Confessions of an Auto Finance Manager,” located at http://www.edmunds.com/advice/buying/articles/125308/article.html
About Edmunds Inc. (http://www.edmunds.com/help/about/)
Edmunds Inc. publishes four Web sites that empower, engage and educate automotive consumers, enthusiasts and insiders. Edmunds.com, the premier online resource for automotive consumer information, launched in 1995 as the first automotive information Web site. Its most popular feature, the Edmunds.com True Market Value®, is relied upon by millions of people seeking current transaction prices for new and used vehicles. Edmunds.com was named "Best Car Research Site" by Forbes ASAP, has been selected by consumers as the "Most Useful Web Site" according to every J.D. Power and Associates New Autoshopper.com Study(SM), was ranked first in the Survey of Car-Shopping Web Sites by The Wall Street Journal and was rated "#1" in Keynote's study of third-party automotive Web sites. Inside Line launched in 2005 and is the most-read automotive enthusiast Web site. CarSpace launched in 2006 and is an automotive social networking Web site and home to the oldest and most established automotive community. AutoObserver.com launched in 2007 and provides insightful automotive industry commentary and analysis. Edmunds Inc. is headquartered in Santa Monica, California, and maintains a satellite office in suburban Detroit.
Friday, August 8, 2008
JEEP without Dana
Chrysler May Risk Shutdowns
Without Dana Parts Accord
By Mike Ramsey and Alex Ortolani
Aug. 7 (Bloomberg) -- Chrysler LLC, the third-largest U.S. automaker, risks a possible production shutdown should supplier Dana Holdings Inc. win a lawsuit to end a money-losing contract.
Chrysler would have few options to replace Dana's axles and driveshafts, said James Gillette, a consultant with CSM Worldwide Inc. in Grand Rapids, Michigan.
``It puts an enormous amount of pressure on Chrysler,'' Gillette said in an interview today, a day after Dana asked a bankruptcy judge to let it halt its parts accord on Dec. 31. ``It's not like there are 200 other suppliers they could go to. Dana does have some level of bargaining power.''
The dispute is at least Chrysler's third this year as the automaker tries to shrink spending amid a 23 percent drop in U.S. sales. Chrysler rebuffed a bid for higher prices from Plastech Engineered Products Inc. in February and is tangling with Germany's Continental AG over a parts contract.
Dana, based in Toledo, Ohio, said rising steel prices mean it's losing $75 million annually on its parts agreement for six Chrysler models.
``We're not out here to pick a fight with Chrysler,'' Dana Chairman John Devine said today on a conference call with analysts. The Chrysler business has ``a significant loss and we need to address that,'' he said.
Chrysler's view is that ``while the agreement may end on Jan. 1, 2009, the underlying purchase orders were intended to continue in accordance with their terms,'' said Kevin Frazier, a spokesman for the Auburn Hills, Michigan-based automaker.
Dana Alternatives?
Magna International Inc., American Axle & Manufacturing Holdings Inc. (great Hummer parts in my Wranglers) and Tower Automotive LLC are among a handful of companies capable of stepping in for Dana as a Chrysler supplier, Gillette said. It's unlikely those partsmakers would take a money-losing contract, he said. Chrysler and Tower are both owned by Cerberus Capital Management LP.
Chrysler purchasing chief John Campi told suppliers on May 15 that Chrysler set a goal of reducing parts-production costs by 25 percent over a three-year period.
Dana, which left bankruptcy protection in February, asked U.S. Bankruptcy Judge Burton Lifland yesterday to confirm that its supply agreement ends Dec. 31. Chrysler told Dana it doesn't have the right to end the supply agreement, according to the complaint.
The 2007 accord made Dana the exclusive supplier of driveshafts, axles and other parts to Chrysler until the end of this year, according to the partsmaker. Because Chrysler refused to extend the deal into 2009, Dana said, any orders beyond 2008 are ``unenforceable.''
SUV, Pickup Parts
Dana said it supplies parts to Chrysler's Jeep Liberty, Wrangler and some Grand Cherokee sport-utility vehicles, as well the Dodge Nitro SUV, Viper sports car and some Dodge Ram pickups.
Citing lower U.S. sales and rising costs for steel, Dana announced plans today to cut 3,000 jobs and said it lost $140 million in the second quarter. Dana fell 15 cents, or 2.5 percent, to $5.84 at 4:15 p.m. in New York Stock Exchange composite trading.
Chrysler canceled a contract with Plastech in February and demanded the return of tooling after the closely held supplier requested a price increase as raw-material costs rose.
The move forced Plastech into bankruptcy protection and caused four Chrysler plants to be shut down for several days. Plastech has been partially sold off to supplier Johnson Controls Inc. and remains in bankruptcy.
Chrysler also owes money to Continental, which makes engine-control electronics, for failing to buy as many parts as promised from a plant in Huntsville, Alabama, Continental Chief Financial Officer Alan Hippe said on July 31.
The amount is ``much less'' than $100 million, Hippe said without elaborating.
Continental spokeswoman Michele Tinson declined to comment immediately today on the Hanover, Germany-based company's efforts to collect the money. Frazier, the Chrysler spokesman, declined to comment on the case.
harold zeigler
Wednesday, August 6, 2008
TEST DRIVE: ASPEN HYBRID
I have been waiting and waiting for this new Road Warrior to hit the lot, so as I read this review I found myself not so excited anymore reading things like "this SUV handles like a bowl full of Jello" or "second ugliest" ...Then I read the last few lines and now I am excited again....
Test Drive: Chrysler's green Aspen offers room, vroom and decent gas mileage
By Scott BurgessDetroit News
Article Launched: 08/06/2008 09:47:20 AM PDT
2009 CHRYSLER ASPEN HYBRID
At first, "Hemi hybrid" sounds like an oxymoron in a George Carlin bit, falling between "military intelligence" and "jumbo shrimp."
But this word combo is no laughing matter for Chrysler LLC, which is trying to show that its legendary engine - known for burning tires in the past - can efficiently push eight people around town in the future.
EPA's assessment says the 5.7-liter Hemi delivers 19 miles per gallon in the city and 20 mpg on the highway. Not spectacular numbers, but certainly better than the 13 mpg in the city the 2008 Aspen reached with a 4.7-liter V-8. During my week of testing this large SUV, I was able to hit 26 mpg at times; other times, 18 mpg. Admittedly, on the high mileage days, the roads were flat and my right foot was in eco-drive mode - though I never acted like those 55-mph imbeciles on a 70-mph highway.
The 2009 Chrysler Aspen Limited hybrid is not a vehicle without flaws. The interior still has a heavy plastic feel, especially the doors and dash, and comes with the second ugliest hood on a Chrysler vehicle. But it serves a purpose, and not every vehicle on the road today can say that. Some people do need a truck and the Aspen is exactly that: a big hulking truck. After a few days behind the wheel, I started to remember how nice SUVs can be.
So before every hemp-wearing nut spills his green ice tea lemonade (no syrup) while in a hurry to send me a terse e-mail over his iPhone 3G about the evils of SUVs, let me tell you something:
You're wrong.
Americans may switch to smaller cars, but it's only because they have to; not because they want to.
We've all heard the trend: Consumers are migrating away from trucks - and I am by no means making excuses for Detroit's quiet.
The 5.7-liter Hemi hums along on the highway on four cylinders and keeps a low idle during moderate acceleration. (The electric motors assist the engine when cruising at highway speeds, which is why the highway mileage numbers are slightly improved.) Press the accelerator hard and you can feel the combined 385-horsepower engine lurch the vehicle forward.
However, drive fast at your own peril. This SUV handles like a bowl of Jello when going fast. The electric power steering is a little loose and the body rolls through turns heavily. I said it before: it's a big truck. The braking (which also helps recharge the batteries) is excellent, so I never found myself in too much trouble.
There may be people who need this kind of vehicle, but the real problem is there are just not that many.
This is a fine SUV. And those last three letters may be its downfall.
Automotive consumers are begging for high-mileage cars and crossovers, not better-performing large SUVs. There is a market for this vehicle, and those few customers will be pleased with it. But it's not going to be enough to pull Chrysler out of its current tailspin. The sooner Chrysler adopts its hybrid technology into Dodge Chargers, Avengers and Calibers, the better.
When you consider price, performance and capabilities, this is the best large hybrid SUV on the road. But for most people, who really needs it?
harold zeigler
Test Drive: Chrysler's green Aspen offers room, vroom and decent gas mileage
By Scott BurgessDetroit News
Article Launched: 08/06/2008 09:47:20 AM PDT
2009 CHRYSLER ASPEN HYBRID
At first, "Hemi hybrid" sounds like an oxymoron in a George Carlin bit, falling between "military intelligence" and "jumbo shrimp."
But this word combo is no laughing matter for Chrysler LLC, which is trying to show that its legendary engine - known for burning tires in the past - can efficiently push eight people around town in the future.
EPA's assessment says the 5.7-liter Hemi delivers 19 miles per gallon in the city and 20 mpg on the highway. Not spectacular numbers, but certainly better than the 13 mpg in the city the 2008 Aspen reached with a 4.7-liter V-8. During my week of testing this large SUV, I was able to hit 26 mpg at times; other times, 18 mpg. Admittedly, on the high mileage days, the roads were flat and my right foot was in eco-drive mode - though I never acted like those 55-mph imbeciles on a 70-mph highway.
The 2009 Chrysler Aspen Limited hybrid is not a vehicle without flaws. The interior still has a heavy plastic feel, especially the doors and dash, and comes with the second ugliest hood on a Chrysler vehicle. But it serves a purpose, and not every vehicle on the road today can say that. Some people do need a truck and the Aspen is exactly that: a big hulking truck. After a few days behind the wheel, I started to remember how nice SUVs can be.
So before every hemp-wearing nut spills his green ice tea lemonade (no syrup) while in a hurry to send me a terse e-mail over his iPhone 3G about the evils of SUVs, let me tell you something:
You're wrong.
Americans may switch to smaller cars, but it's only because they have to; not because they want to.
We've all heard the trend: Consumers are migrating away from trucks - and I am by no means making excuses for Detroit's quiet.
The 5.7-liter Hemi hums along on the highway on four cylinders and keeps a low idle during moderate acceleration. (The electric motors assist the engine when cruising at highway speeds, which is why the highway mileage numbers are slightly improved.) Press the accelerator hard and you can feel the combined 385-horsepower engine lurch the vehicle forward.
However, drive fast at your own peril. This SUV handles like a bowl of Jello when going fast. The electric power steering is a little loose and the body rolls through turns heavily. I said it before: it's a big truck. The braking (which also helps recharge the batteries) is excellent, so I never found myself in too much trouble.
There may be people who need this kind of vehicle, but the real problem is there are just not that many.
This is a fine SUV. And those last three letters may be its downfall.
Automotive consumers are begging for high-mileage cars and crossovers, not better-performing large SUVs. There is a market for this vehicle, and those few customers will be pleased with it. But it's not going to be enough to pull Chrysler out of its current tailspin. The sooner Chrysler adopts its hybrid technology into Dodge Chargers, Avengers and Calibers, the better.
When you consider price, performance and capabilities, this is the best large hybrid SUV on the road. But for most people, who really needs it?
harold zeigler
Tuesday, August 5, 2008
IT'S BEEN A RIDE
Key dates in Chrysler's transition under Cerberus
2007:
Feb. 14: DaimlerChrysler AG announces a restructuring plan that includes cutting 13,000 Chrysler workers and says it won't rule out "any option," including Chrysler's sale.
April 5: Billionaire investor Kirk Kerkorian's Tracinda Corp. makes a $4.5 billion cash offer for Chrysler.
May 14: DaimlerChrysler announces the end of nine-year partnership with Chrysler and agrees to sell 80.1 percent of Chrysler to private equity firm Cerberus Capital Management LP for $7.4 billion.
July 20: The United Auto Workers union and Chrysler officially begin negotiations on a new four-year contract.
Aug. 3: Cerberus takes over a majority share of Chrysler.
Aug. 6: Chrysler officially begins its life as a private company. Bob Nardelli, former chief executive of The Home Depot Inc., becomes chairman and CEO. Tom LaSorda, Chrysler's former CEO, takes the No. 2 spot under Nardelli.
Oct. 10: The UAW reaches a tentative agreement with Chrysler after a six-hour nationwide strike. Later, 56 percent of Chrysler production workers vote in favor of the four-year deal.
Nov. 1: Chrysler says it will cut 8,500 to 10,000 hourly jobs and 2,100 salaried jobs through 2008, or about 15 percent of its work force, in addition to the 13,000 layoffs announced in February.
Early December: Nardelli tells employees that the company is "operationally" bankrupt and expects to lose $1.6 billion for the year.
2008:
Jan. 11: Chrysler and Nissan Motor Co. agree to have Nissan supply a subcompact car to Chrysler that will go on sale in South America in 2009.
Jan. 22: Cerberus founder Stephen Feinberg writes a letter to investors saying Chrysler is beating its earnings estimates but the "investment is by no means without serious risks."
Jan. 28: Chrysler begins offering buyouts of up to $100,000 to hourly workers as part of its goal of cut up to half its hourly work force.
Feb. 8: Chrysler says it plans to reduce its product lineup by as much as half and cut dealerships.
April 15: Chrysler says it will make a new full-size pickup for Nissan Motor Co. and Nissan will make a new small car for Chrysler. The small car is scheduled to go on sale in 2010, the pickup in 2011.
June 10: Nardelli says he expects Chrysler will be an independent company three years from now, and that Cerberus isn't second-guessing its investment.
June 26: Chrysler denies it plans to file for bankruptcy protection after Chrysler exercises a $2 billion line of credit from Cerberus and Daimler.
June 30: Chrysler says it will close a minivan plant in St. Louis and cut a shift from a nearby plant because of declining U.S. sales, affecting 2,400 jobs.
July 4: Chrysler announces a deal with China's Great Wall Motor Co. to study sharing technology, components and distribution.
July 23: Chrysler says it will cut 1,000 salaried jobs by Sept. 30 because of the industry slump.
July 25: Chrysler announces that its financial arm will get out of the auto leasing business because economic conditions have made it more expensive than buying vehicles.
harold zeigler
Brett
Latest and Greatest from HZ Grandville
"You really have to want to do business with us for so many reasons", this is just one of them, "we are a lot of fun."
harold zeigler
Saturday, August 2, 2008
On the subject of interiors in new product, feast your eyes on this splendid review of Journey, dated Aug. 2, and focus your attention on the next-to-last paragraph, beginning with “Cabin design is stylish, with most materials and surfaces notably higher quality than some other Dodges….”
Let there be no illusions among the rational people on this blog that the irrational ones will now recant their ignorant obsession with media hostility to Chrysler. When 300 was named Motor Trend’s Car of the Year, I thought it would be the end of that ill-informed syndrome. But it will always be with us. Chrysler products get favorable media reviews when they earn them on their own merit, period.
A few other points worth nothing: The 6th paragraph (”In most aspects, the 2009 Journey hits the target, but with more refinement, it could have been nipping at the smoothest of this class, Toyota Highlander, Mazda CX 9. Honda Pilot, Hyundai Veracruz and GMC Acadia and its siblings.” Is there anyone out there who has driven one or more of those vehicles and also driven a Journey who can dispute the point that while Chrysler has come a long way, it still has a way to go to catch up with the best in the industry in refinement? That reputation hurts in the market place and has got to fixed.
COMMENTARY: PETE SZILAGYI
A desirable Journey
Dodge's midsize crossover is capable of taking the economy-minded where they want to go
By Pete Szilagyi SPECIAL TO THE AMERICAN-STATESMAN Saturday, August 02, 2008
As $4 gas becomes entrenched and reality barges rudely into the car market, drivers will reject uni-taskers and ask that vehicles serve several functions and do it with some economy.
In other words, if the family car or SUV can't pull its own weight and lots more, it's outta here.
That means trading in sports coupes and heavy SUVs for compact hatchbacks and crossovers.
Dodge's latest multitasker, the midsize Journey, isn't quite the Swiss Army knife of crossovers, but it incorporates desirable features Chrysler learned with its minivans and large trucks.
Base price for the 4-cylinder, front-drive Journey is a reasonable $19,985. It is also available in all-wheel drive.
In most aspects, the 2009 Journey hits the target, but with more refinement, it could have been nipping at the smoothest of the class, the Toyota Highlander, Mazda CX-9, Honda Pilot, Hyundai Veracruz and General Motors' GMC Acadia and its siblings.
As it stands, the Journey should compete well in price competition and styling. It's distinctive enough for a vehicle late to the segment when the obvious design elements were already in use.
Achieving economical operation is confounding to any 4,000-pound, seven-passenger SUV, so a buyer's goals should be realistic. My several days in a Journey SXT with the optional 235-horsepower, 3.5-liter V-6, 6-speed automatic were close to the EPA estimate, 19 mpg, in fairly easy city and highway driving. That's typical for midsize crossovers, although the relatively expensive Highlander Hybrid is the exception, achieving mileage in the upper 20s.
The Journey's independent suspension, front and rear, contributes to predictable handling. Freeway expansion strips and sharp pavement creases caused unpleasant thuds in the cabin. Though not especially light or sporty, the V-6 Journey slips through traffic with competence, and it is as easy to park as any midsize crossover. Based on my long, comfortable interstate highway drives, the Journey is a solid candidate for family road trips.
The Journey SXT scores well on user-friendliness, with roomy, accommodating seats, a true three-across back seat with adjustable backrests, stacked glove boxes with one of them cooled for beverages, clever under-seat and floor storage bins, an optional DVD system, an iPod plug, an integrated child booster seat, doors that open unusually wide, elevated rear seats and optional third-row seating for two children.
Cabin design is stylish, with most materials and surfaces notably higher quality than some other Dodges. The switchgear felt cheap, and the expansive black dashboard in my Journey test unit heated like a griddle when parked in the sun.
Thankfully, the air conditioner cooled adequately, even on humid 95-degree afternoons. Short drivers should note that the Journey's dashboard is quite high and can limit forward visibility. The optional height-adjusting driver's seat is a necessity.
In his 27 years of writing a column for the Austin American-Statesman, Pete Szilagyi has driven more than 1,400 new cars and trucks. You may reach him at petesz@mac.com.
Comparison shopping
Three other vehicles in the Dodge Journey's class:
2008 Hyundai Veracruz
Highs: Styling, cabin design, luxury feel, performance.
Lows: Not much personality.
2008 GMC Acadia
Highs: Appearance, cargo flexibility, power train, attention to detail.
Lows: Too heavy.
2008 Ford Edge
Highs: Styling, interior, power train, utility.
Lows: So-so fuel mileage.
According to Pete ...
Target audience: Active families shucking their Durangos, Sequoias and Tahoes; minivan haters attracted to Journey's styling and minivan features; grandparents anticipating trips with the kids.
Highs: Stance and appearance, comfort, roominess, convenience features, safety gear, price.
Lows: Thudding suspension, switchgear, backing visibility.
Bottom line: The 90 percent solution in a tough field of 98 percenters.
EPA rating for greenhouse gas emissions (10 is best): 4
harold zeigler
Let there be no illusions among the rational people on this blog that the irrational ones will now recant their ignorant obsession with media hostility to Chrysler. When 300 was named Motor Trend’s Car of the Year, I thought it would be the end of that ill-informed syndrome. But it will always be with us. Chrysler products get favorable media reviews when they earn them on their own merit, period.
A few other points worth nothing: The 6th paragraph (”In most aspects, the 2009 Journey hits the target, but with more refinement, it could have been nipping at the smoothest of this class, Toyota Highlander, Mazda CX 9. Honda Pilot, Hyundai Veracruz and GMC Acadia and its siblings.” Is there anyone out there who has driven one or more of those vehicles and also driven a Journey who can dispute the point that while Chrysler has come a long way, it still has a way to go to catch up with the best in the industry in refinement? That reputation hurts in the market place and has got to fixed.
COMMENTARY: PETE SZILAGYI
A desirable Journey
Dodge's midsize crossover is capable of taking the economy-minded where they want to go
By Pete Szilagyi SPECIAL TO THE AMERICAN-STATESMAN Saturday, August 02, 2008
As $4 gas becomes entrenched and reality barges rudely into the car market, drivers will reject uni-taskers and ask that vehicles serve several functions and do it with some economy.
In other words, if the family car or SUV can't pull its own weight and lots more, it's outta here.
That means trading in sports coupes and heavy SUVs for compact hatchbacks and crossovers.
Dodge's latest multitasker, the midsize Journey, isn't quite the Swiss Army knife of crossovers, but it incorporates desirable features Chrysler learned with its minivans and large trucks.
Base price for the 4-cylinder, front-drive Journey is a reasonable $19,985. It is also available in all-wheel drive.
In most aspects, the 2009 Journey hits the target, but with more refinement, it could have been nipping at the smoothest of the class, the Toyota Highlander, Mazda CX-9, Honda Pilot, Hyundai Veracruz and General Motors' GMC Acadia and its siblings.
As it stands, the Journey should compete well in price competition and styling. It's distinctive enough for a vehicle late to the segment when the obvious design elements were already in use.
Achieving economical operation is confounding to any 4,000-pound, seven-passenger SUV, so a buyer's goals should be realistic. My several days in a Journey SXT with the optional 235-horsepower, 3.5-liter V-6, 6-speed automatic were close to the EPA estimate, 19 mpg, in fairly easy city and highway driving. That's typical for midsize crossovers, although the relatively expensive Highlander Hybrid is the exception, achieving mileage in the upper 20s.
The Journey's independent suspension, front and rear, contributes to predictable handling. Freeway expansion strips and sharp pavement creases caused unpleasant thuds in the cabin. Though not especially light or sporty, the V-6 Journey slips through traffic with competence, and it is as easy to park as any midsize crossover. Based on my long, comfortable interstate highway drives, the Journey is a solid candidate for family road trips.
The Journey SXT scores well on user-friendliness, with roomy, accommodating seats, a true three-across back seat with adjustable backrests, stacked glove boxes with one of them cooled for beverages, clever under-seat and floor storage bins, an optional DVD system, an iPod plug, an integrated child booster seat, doors that open unusually wide, elevated rear seats and optional third-row seating for two children.
Cabin design is stylish, with most materials and surfaces notably higher quality than some other Dodges. The switchgear felt cheap, and the expansive black dashboard in my Journey test unit heated like a griddle when parked in the sun.
Thankfully, the air conditioner cooled adequately, even on humid 95-degree afternoons. Short drivers should note that the Journey's dashboard is quite high and can limit forward visibility. The optional height-adjusting driver's seat is a necessity.
In his 27 years of writing a column for the Austin American-Statesman, Pete Szilagyi has driven more than 1,400 new cars and trucks. You may reach him at petesz@mac.com.
Comparison shopping
Three other vehicles in the Dodge Journey's class:
2008 Hyundai Veracruz
Highs: Styling, cabin design, luxury feel, performance.
Lows: Not much personality.
2008 GMC Acadia
Highs: Appearance, cargo flexibility, power train, attention to detail.
Lows: Too heavy.
2008 Ford Edge
Highs: Styling, interior, power train, utility.
Lows: So-so fuel mileage.
According to Pete ...
Target audience: Active families shucking their Durangos, Sequoias and Tahoes; minivan haters attracted to Journey's styling and minivan features; grandparents anticipating trips with the kids.
Highs: Stance and appearance, comfort, roominess, convenience features, safety gear, price.
Lows: Thudding suspension, switchgear, backing visibility.
Bottom line: The 90 percent solution in a tough field of 98 percenters.
EPA rating for greenhouse gas emissions (10 is best): 4
harold zeigler
Friday, August 1, 2008
In lieu of leases, Chrysler wants you to "Shop 'til you Drive"
Chrysler's departure from the leasing game certainly isn't going to help dealers move stale product off their lots, so the automaker has announced a new sales program unimaginatively named the "Shop 'Til You Drive Sales Event." (What does that even mean?)
What'll it take to get you into a new Chrysler, Dodge or Jeep vehicle?Well, aside from $2,000 cash back on "select retail purchases," Chrysler is offering an August-only, 72-month, zero-percent APR financing deal on many of its slow-selling models that aims to make monthly payments approximately the same as a 36-month lease.
Additionally, pricing on Dodge, Chrysler and Jeep vehicles has been slashed, with the Ram dropping 40-percent of its MSRP, Aspen hacked by up to 25 percent, Town & Country minivans cut by 24 percent and Grand Cherokees dropping 28 percent.
Chrysler will also try to get lessees back into dealerships by offering special "loyalty incentives" that will be applied to a new retail purchase, along with waiving the $425 lease disposition fee.
harold zeigler
Wrangler always on the list!
Top 10 Vehicles with the Highest Resale Value
Cars shed dollars with each mile their wheels turn. But some hold their value far better than others. Find out why and what you can do to minimize losses.
Published on 2008-07-31 -->by JEFF ZYGMONT, ForbesAutos.com
You can't call them "good investments" because they inevitably depreciate. But the models in our ranking of the top 10 vehicles with highest resale value do amount to sensible purchases for the way they minimize the dollar losses associated with owning and maintaining a vehicle.
The models on our list retain a higher percentage of their original purchase price than any other car you can buy. But high gas prices are having a dramatic effect on prices — so much so that in just a matter of weeks, the list of the top 10 vehicles with the highest resale values will look different.
"Economy cars are improving," says John Blair, chief executive officer of Automotive Lease Guides (ALG), a market research firm headquartered in Santa Barbara, Calif. "The outlook for small, fuel-efficient vehicles is much brighter today versus a year ago. And the outlook on SUVs has changed dramatically in the other direction."
Basically, fuel efficient vehicles are gaining value and non-fuel-efficient vehicles are losing value.
So it's no surprise that the car that tops this ranking, the playful Mini Cooper, is one of the most fuel-efficient models on sale in the United States. It will hold more than 60 percent of its value after three years of ownership.
Sensible but Fun
Even though rising fuel prices have caused fuel economy to have a greater impact on resale values, most of the models in our ranking don't ask you to sacrifice in the service of fiscal good sense. They are fun and rewarding to drive, each in their own way.
Some express youthful nonconformity, like the Scion xB, Nissan Rogue and Volkswagen New Beetle Convertible, numbers 7, 9 and 10, respectively. The Infiniti G37 Coupe, BMW 1 Series and Audi S5, which rank second, third and tenth, combine sophistication with spirited energy.
Volkswagen's R32, at number No. 5, exudes athletic exuberance. The four-wheel-drive convertible Jeep Wrangler, No. 4, invites rugged adventure.
Even the two top-10 finishers that appear purely practical, Honda's CR-V and Civic Hybrid, are far from pedestrian. They're smartly styled, well engineered and have a refined driving experience. The Civic Hybrid adds technological charm to those attributes.
Smart styling contributes a lot to a vehicle's resale value, says John Blair, chief executive officer of ALG. That's due to fundamental market dynamics: supply and demand.
A model that is uniquely attractive will generate more demand from people shopping for used cars. Naturally, that greater demand pumps up its resale price. Thus, ALG puts a heavy weight on appearance when it estimates the residual value of new vehicles.
Residual value is analogous to resale value, but it's not the same thing. It's the price that a model in average condition is expected to take in when eventually it is sold at a wholesale used-car auction. The retail value of a vehicle — the price a consumer pays to buy it — varies a little from model to model but generally runs about 15 percent above the ALG residual value, Blair says.
The firm's estimates are used by automotive lease writers to determine how much a model will be worth when its lease expires. Our top 10 vehicles with the highest resale value — there are actually 11 models on the list, thanks to one tie — are based on ALG residual values expressed as a percent of the original purchase price. All are current, 2008 models. The ranking excludes specialty cars produced in low numbers.
All About Perceptions
In addition to a vehicle's styling, its manufacturer's reputation for quality has a big impact on how much value it retains, Blair says.
"The No. 1 influence is certainly a vehicle brand and the perception of the brand," he says. "The used-car buyer is looking for a vehicle that's not going to be a maintenance headache for them. If you have a strong brand, that has a real positive influence on the residual value."
Thursday, July 31, 2008
GMAC posts $2.5 billion loss in 2nd quarter
GMAC posts $2.5 billion loss in 2nd quarter
NEW YORK -- GMAC Financial Services says it swung to a steep second-quarter loss as slumping vehicle sales and a weak credit and consumer environment weighed on its results.
GMAC says it lost $2.5 billion in the second quarter compared with a profit of $293 million in the same quarter last year. It says its Residential Capital LLC lending division's loss widened to $1.86 billion from $254 million.
GMAC also says it took a $716 million impairment charge during the quarter due to slumping vehicle sales and lower used vehicle prices.
Chief Executive Alvaro G. de Molina says volatility in the mortgage and credit markets significantly weakened results for the quarter.
The company is majority owned by private equity firm Cerberus Capital Management but General Motors Corp. still holds a large stake.
NEW YORK -- GMAC Financial Services says it swung to a steep second-quarter loss as slumping vehicle sales and a weak credit and consumer environment weighed on its results.
GMAC says it lost $2.5 billion in the second quarter compared with a profit of $293 million in the same quarter last year. It says its Residential Capital LLC lending division's loss widened to $1.86 billion from $254 million.
GMAC also says it took a $716 million impairment charge during the quarter due to slumping vehicle sales and lower used vehicle prices.
Chief Executive Alvaro G. de Molina says volatility in the mortgage and credit markets significantly weakened results for the quarter.
The company is majority owned by private equity firm Cerberus Capital Management but General Motors Corp. still holds a large stake.
Friday, July 25, 2008
Chrysler's financial arm no longer offering leases
Chrysler LLC's financial division will no longer be offering leases to U.S. consumers on Chrysler products as of August 1st.
The automaker will be holding a conference call with dealers later today to go over the changes and the reasons behind the decisions, but Chrysler spokesperson, Bill Porter, told Reuters "We are shifting our strategy to focus on retail products.
"The move comes amidst Chrysler's attempt to get 20 banks to renew a $30 billion credit facility for the automaker's financial arm. The rise in borrowing costs next month will make it more difficult for Chrysler to offer low-interest loans and could spell further disasters on the sales front.
Chrysler offering even more incentives to close out July
The automotive sales sector is in a major state of flux as consumers continue to run from SUVs and pickup trucks into smaller, more fuel efficient cars. One manufacturer hit especially hard by this transition is Chrysler, a company that recently posted the worst fleet average fuel economy numbers of all major automakers in the U.S. due to its truck-heavy lineup. Still, the automaker has built up a large supply of Chrysler, Dodge and Jeep utility vehicles that they have got to get off dealer lots somehow. To ease consumers into the fuel-thirsy utes, Chrysler has introduced new incentives of zero-percent financing for 72 months on the 2008 Dodge Durango, Chrysler Aspen and Jeep Grand Cherokee and Commander. While the lack of any financing charges will certainly impact the bottom line, it is nothing compared to the losses the automaker has been hit with over its past lease deals. In fact, truck and SUV residuals are so bad these days that Chrysler Financial has gone so far as to completely cut leasing out of its available portfolio starting August 1. The financing deals announced today are scheduled to continue through Thursday, July 31.
Normally the privately owned Chrysler LLC is under no obligation to reveal its financial performance to Wall Street, but yesterday the Cerberus-owned automaker was forced to show a few pages from its accounting books thanks to one of its largest stakeholders and former owner, Daimler AG. The German automaker revealed that in the last six months, its 19.9% stake in Chrysler has cost it $585 million. To clarify Daimler's numbers, Chrysler also revealed yesterday that the loss being attributed to it, all of which was incurred in Daimler's first fiscal quarter of the year, is around 65 million euro, or $103 million, using American accounting standards. Perhaps realizing that all analysts had to do was multiply Daimler's loss by five to arrive at Chrysler's total loss for the last quarter, the automaker just came right out and said it lost about $515 million. While a mere pittance to the $8.7 billion worth of red ink Ford spilled during Q2, it was enough to drag down Daimler's numbers halfway around the world.
Tuesday, July 22, 2008
Dodge
The 2009 Dodge Journey has a spacious interior, nifty styling and an optional V-6 that really scoots.
Quite an accomplishment, Chrysler's Dodge Journey.
It's a crossover SUV based on the Dodge Avenger sedan. Even though the two share unseen hardware, they're not at all alike and won't steal sales from one another. And because Journey is a new vehicle, it represents additional sales for dealers and the brand.
AUDIO GALLERY: More photos with Healey's comments
Journey also manages to more or less replace the lame-duck Chrysler Pacifica in the corporate product mix, as well as be the company's reasonable stand-in, without the boring-parent stigma, for the discontinued Dodge and Chrysler short-wheelbase minivans.
Journey's swing-open rear doors rather than van sliders make all the difference in image and appearance, but they still can be opened very wide (if you have room) for exceptional access.
FIND MORE STORIES IN: Dodge Journey
The first Journeys hit showrooms in February; only now is the pipeline full.
Notable is that Journey continues the move toward higher-class interiors seen in many of the company's recent Chrysler, Dodge and Jeep products.
The test vehicles were a loaded, $35,000, all-wheel-drive preproduction R/T and a sparser, $23,000, front-drive, regular-production SXT. The SXT seemed like a roomy family hauler with a pleasant array of features at bargain price: No need to cram in like sardines for that eight-state road trip or settle for bottom-feeder execution to save the family budget.
The R/T seemed like a relatively value-priced alternative to the pricier Honda Pilot and Toyota Highlander. The Journey also offers an optional third-row seat that's not available at any price in the Ford Edge, probably its most direct rival.
On the minus side, Journey offers no fuel-sipping alternative power plant, such as Highlander's hybrid drive, in this era of fuel-induced hysteria.
There "could be" a fuel-economy powertrain for the U.S. eventually, says Larry Lyons, Chrysler vice president in charge of most vehicle development. He notes that foreign-market Journeys use a Volkswagen diesel approved for sale in the U.S. (VW's bringing it here soon.) But he won't say if he's hinting or teasing.
What stuck out:
•Styling. Nifty. Trim, taut. Not ruined by exterior uglification items such as spoilers, spats and running boards. Journey reminds you of a minivan (implying space and convenience), but doesn't quite look like one (ducking the strong anti-van prejudice of many buyers). How's that for walking the line?
Tasty icing on the cake: American-style dual exhausts. One big pipe under the left side of the rear bumper and another on the right, not euro-style two pipes together on one side, or — horrors — a single pipe. It's been a terrible irony to see the Japanese become the main users of all-American duals. Applause for Lyons, who held fast against the corner-cutters.
Why care about duals? Well, two pipes let the exhaust out a little faster than one. With proper tuning, that lets the engine produce more power and run cooler — even if the exhaust runs through a single muffler and catalytic converter before it hits the dual outlets.
Plus, they look so drop-dead good.
•Cleverness. It's as apparent as you'd expect from the company that popularized minivans. Stowage sites illustrate: two under-floor bins in front of the second-row seat. Another under the front passenger's seat cushion. Lift it, stash your goods, and close, or, if you don't need the seating, leave it up as a bin for purse or laptop bag.
The cargo floor has additional space below, too — lots of it if you pass on the optional third-row seat, still a useful amount if you don't.
The glove box has a cubby linked to the air conditioning to keep a couple of soft drinks cool.
Optional pop-up booster seats in the second row are a great idea, but didn't seem comfy to a 5-year-old who used them.
•Powertrain. The optional V-6 scooted as if chased by bees, and the six-speed automatic, driven hard, sliced off shifts like a deli saw through salami.
But the transmissions were bedeviled with jiggles and shuffles when driven moderately — and several times served up violent jolts in low-speed shifts. Peculiarly, the production model, which should have all the bugs worked out, shifted worse than the preproduction vehicle. Chrysler's lifetime powertrain warranty is some comfort.
The standard four-cylinder engine, equipped with a four-speed automatic, wasn't tested.
Optional all-wheel drive is normally in FWD mode and shifts up to 60% of power to the rear wheels when the fronts spin or the driver accelerates hard.
•Dynamics. Too-boosted power steering was unpleasant. But unexpectedly, the steering retained good on-center feel and avoided the sloppy action that usually accompanies over-boosted systems. Brakes were OK, neither touchy nor somnambulant.
R/T and AWD models have a sporting suspension that took corners in a more stable way than the FWD SXT's slightly soggy underpinnings.
•Interior. Quieter than many crossovers tested lately, which makes it restful on long trips and gives it a premium air. As noted earlier, nicer materials and trim than has been the case in recent Chryslers.
The second row slides, to tailor the mix of people and cargo. Also, it easily flip-folds forward for access to the optional third row.
Swiveling your body and climbing out of the driver's seat caused plastic seat trim to creak on the production model, not the preproduction.
The disc for the optional rear DVD system has to be loaded into the dashboard player from the front seat, which either is a way to police what the kids are watching, or a danged nuisance for stressed parents. When the screen's down in viewing position, it blocks much of the driver's rear view.
Funny how we get all het up about regulations involving tire pressure monitoring and electronic stability control, but ignore basics such as preserving the driver's view to the rear.
An easy remedy would be for automakers to offer video screens in the backs of the front-seat head restraints, eliminating visibility problems. They could do it for about the same money as the ceiling screen, and it's how Ford handles it if you want the glass roof in the Edge, which leaves no ceiling space to mount a DVD screen. Yes, screen-equipped head restraints (aka headrests) can be designed to safely absorb crash impact and not be a danger to the front or back occupant's skull.
The easy quickness of the V-6, the thoughtful interior and relatively modest prices make Journey a pleasing alternative to the flood of other crossovers. If you aren't troubled by the transmission's lack of cotillion manners and that bothersome seat-trim creak, you can consider Journey a solid contender. Or you can look again later, to see if Dodge exorcised the glitches.
2009 Dodge Journey
What? Crossover SUV based on a stretched Dodge Avenger chassis with two or three rows of seats, four-cylinder or V-6 engine, front-wheel drive (FWD) or all-wheel drive (AWD), in three models: SE, SXT, R/T.
When? On sale since February.
Where? Built at Toluca, Mexico. BEST DEALS AT HAROLD ZEIGLER CHRYSLER DODGE JEEP IN GrandRapids / Grandville
Why? Crossovers are the haven of choice for fuel-price-frantic owners of traditional, truck-based SUVs.
How? Stretch the Avenger wheelbase 4.9 inches, design a spacious body and interior but use Avenger's engines, transmissions and optional AWD system to cut costs.
How much? Base SE FWD with four-cylinder starts at $19,985, including $625 shipping. Loaded R/T AWD, about $35,000.
How powerful? SE has 2.4-liter, four-cylinder rated 173 horsepower at 6,000 rpm, 166 pounds-feet of torque at 4,000 rpm; four-speed automatic transmission.
All other models have a 3.5-liter V-6 rated 235 hp at 6,400 rpm, 232 lbs.-ft. at 4,000 rpm; six-speed automatic.
How lavish? Among standard features in all models: front, side, side-impact and head-curtain air bags; anti-lock brakes; stability control; AM/FM/6-CD stereo with input jack; air conditioning; folding, sliding, reclining second-row seats; tilt/telescope steering column; power steering, brakes.
How big? A few inches longer and narrower than Ford Edge. Journey is 192.4 inches long, 69.5 inches tall, 72.2 inches wide, 113.8-inch wheelbase. Weight ranges from 3,801 to 4,233 pounds. Passenger space is 125.6 cubic feet. Cargo space is 10.7 cubic feet behind third row, 37.1 behind second row in three-row vehicles, 39.6 cubic feet in two-row vehicles; 67.6 cubic feet with second, third rows folded.
Tows 1,000 pounds (four-cylinder) or 3,500 pounds (V-6 tow package). Carries 1,099 to 1,367 pounds depending on model. Turning circle: 39 feet (19-inch wheels), 38.5 feet (17-inch, 18-inch wheels).
How thirsty? Four-cylinder rated 19 miles per gallon city, 25 highway, 21 combined. V-6 FWD 16/23/18, AWD 15/22/17.
Window sticker on early vehicles may differ slightly because of since-corrected rounding error, Chrysler says. Trip computers in test cars showed 15.6 mpg (AWD) and 16 mpg (FWD) in suburban driving.
Tank holds 20.5 gallons (FWD), 21.1 (AWD). Regular specified for four-cylinder. Midgrade recommended for V-6.
Overall: Quite appealing.
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