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Friday, 18 September 2015

Why Bronco Should Return as a Wrangler Fighter

Is there a self-respecting automotive enthusiast alive, myself included, who wouldn’t love to see Ford resurrect the Bronco? Answer: Absolutely, the fun loving folks in Auburn Hills.
Ford may not need to develop a new Bronco, but it absolutely should. And it should use the Jeep Wrangler as its benchmark.

The Wrangler nameplate is so robust that it survived the under-funded ineptitude of AMC, the lean independent years, the cost cutting Cerberus era, and even the culture-challenged Mercedes decade. Wrangler transcends traditional logic of automotive success. It’s not fuel efficient, space efficient, quiet, comfortable or even particularly reliable, yet it thrives thanks to the enduring emotional connection consumers experience with it.
Consider the Wrangler’s track record: When total car sales dipped 39 percent between 2005 and 2009, Wrangler sales rose 6 percent. Since then, Wrangler sales have increased 160 percent while the industry is up 67 percent. If Wrangler were a mutual fund it would have crushed the Dow on the way down and on the way back up.
Despite all the love, the Wrangler is all alone. Others have tried (Samurai/Tracker/FJ Cruiser/Xterra) but none had the brand, legacy and/or form factor that a new Bronco could enjoy. We love the Wrangler like few other vehicles, in much the same way we could love a new Bronco.
We can thank recent growth in the compact/mid-size pickup segment for the Bronco opportunity because, without the investment in a new Ranger, a Bronco resurrection would not be viable (see Ford May Bring Ranger Back To US in 2018). Moreover, a new Bronco would supplement the Ranger in filling the void at the Michigan Truck Plant left by the departing C-Max/Focus. This idea is not new, but what form should the new Bronco take?
There has been discussion of Ford reissuing the Bronco using the T6 Ranger-based Everest (see Let’s Break Down The Ford Ranger and Bronco Rumors, Shall We?). As the logic goes, the rumored loss of Explorer’s D4 platform mates (MKS/ MKT/Flex/Taurus) will transform today’s Explorer into a scale-challenged orphan ready for replacement by a modified Everest. However, Explorer exited the recession with strength, posting double digit growth in each of the last six years and is on pace to move 270k units this year. It may not be nearing its pre-recession glory of 400k annual units, but it justifies itself without platform siblings. Replacing the current unibody, FWD-biased Explorer with a RWD, body-on-frame Everest and all the associated packaging and dynamic challenges that decision brings would be a mistake. Grand Cherokee proves there is room in the mid-size SUV segment for a real off-roader, but Ford should let 4Runner, Grand Cherokee and the new Discovery compete for these rare buyers. The real opportunity is in targeting the peerless Wrangler. Purists rejoice: That means an open-top Bronco, but if Ford wants to do it right it has much to learn from Wrangler.
One of the biggest factors driving Wrangler’s growth over the last decade has been the introduction of the four-door Unlimited in 2007, with a take-rate of 70 percent. Purists may bemoan a four-door Bronco, but without one the Bronco cannot generate the sales volume necessary to justify itself. A two-door only Bronco would end up joining other promising-but-dead products like Excursion and T-Bird. The new Bronco must be an off-road capable, open-top, emotive, fun machine offered in two- and four-door wheelbases.
How many Broncos can Ford sell and how much will it cost to develop? Wrangler is on pace to move 230k units this year. Based on FCA’s continuing investment in Wrangler, the automaker clearly sees a bright future in the nameplate. Ford can expect a mix of Wrangler conquest and new sales. Can Ford wrestle away 10 percent of Wrangler’s market and find another 25k takers a year? Almost certainly. If Bronco development cost — not shared with the new Ranger — reaches $1.5b and the Bronco lifecycle is eight years, Ford will have 400k units over which to amortize the development cost. That equates to about $3,800 per unit, an economic decision roughly equivalent to the Expedition/Navigator twins that attracted Ford’s investment based on combined sales of 42k to 57k units in each of the last seven years.
Will it cannibalize other Ford nameplates and what about CAFE? An uncompromising Bronco, as described here, has only one competitor so the cannibalization question is essentially moot. As for CAFE, absolutely a new Bronco would have a detrimental impact, but these vehicles would achieve a “light truck” classification, thus diminishing their regulatory impact. For a more complete discussion of CAFE I recommend Derek Kreindler’s excellent article, How CAFE Killed Compact Trucks And Station Wagons.
Developing a Bronco to battle Wrangler in its private niche is a sound business decision that almost every enthusiast can get behind. Ford, please resurrect one of the most storied nameplates in automobiledom, and aim it at the Wrangler. Do so, and the only losers will be Ford product managers who are not compensated like Wall Street fund managers.

Monday, 20 July 2015

Buick Offering 24-Hour Test Drives To Build Brand, Not Sell Cars

Buick is tossing the keys to prospective customers for sleepovers in their driveways as part of a brand-building exercise the automaker says isn’t meant to sell cars immediately.
According to Automotive News, the program — dubbed “24 Hours of Happiness” — gives customers the chance to live with a Buick vehicle for 24 hours starting this coming Wednesday.
“Customers thought it showed that we have a real confidence in our vehicles,” Duncan Aldred, Buick brand chief, told AN.
“It’s more of an image builder,” he continued. “Some people can’t believe that Buick has the confidence to send them out in a car without a salesperson sitting next to them to tell them how great the car is.”

EU Gains Not Enough to Stave Opel Production Reductions

Opel Bochum - Picture courtesy wa.de
Recent sales growth in the EU hasn’t been kind to Opel as the group is forced to reduce hours at two German plants.
According to Automotive News, Opel will cut production of the Adam and Corsa at Eisenach and Insignia and Zafira Tourer at Ruesselsheim. The move is due to Opel’s exit from the Russian market and what the automaker calls “moderate” gains in the rest of Europe.
However, within the EU, overall sales for all automakers are up 8.2 percent in the first six month of this year and 14.6 percent in June, according to ACEA.
Opel and Honda are the only two automakers to see sales decline within the EU versus the same six month period last year. Opel experienced a 0.7-percent drop in overall group sales in the EU. Honda took an even harder hit with an 7.9-percent decline.
On the other end of the graph, Mitsubishi has posted 57.0-percent growth in the EU, though that percentage is based on relatively low volume compared to others. Nissan is the runner up at 21.6-percent growth while Jaguar-Land Rover (16.9 percent), Daimler (15.0 percent), FCA (12.9 percent) and BMW (12.0 percent) all saw double-digit percentage growth, beating the overall six-month average.

Another Corvette Z06 Engine Fails, This Time In Journalist’s Hands

While track testing the latest Z06 Corvette, Gary Gastelu of Fox News experienced an issue that’s becoming a trend for Chevrolet’s supercharged sports car: engine failure.
“After a few lapping sessions, the engine in mine unceremoniously called it quits,” reports Gastelu in his review.
Unfortunately the cause is still unknown in this instance, though engine failures are increasing in occurrence for the 650-horsepower Corvette.
Late last year, Corvette Forum’s member “Lawdogg149″ had the LT4 V-8 in his Z06 implode after only 891 miles on the clock. The failure was with the valvetrain, though root cause of the failure wasn’t reported. GM instructed the dealer servicing the car to return the engine to the mothership unopened for further analysis. The Z06 received a new powerplant covered under warranty.
GM Authority stated as many as three failures have been mentioned on Corvette Forums as of June 2015.
Other issues have been reported, such as reduced power after hard launches or track use, in order for the engine to “survive for 100,000 miles as well as allow the Z06 to meet stringent US emissions regs,” reported Jalopnik last year.

Volvo More than Doubles US Polestar Allocation for 2016

Volvo S60 and V60 Polestar, model year 2016
After the sale of Polestar to Volvo, the Swedish automaker is cranking up output and bringing more than double the number of high-performance sedans and wagons to the U.S. for 2016.
Also, there will be more wagons than sedans wearing Polestar badging this time around, as Volvo states 60 percent of the 265 total Polestar units will be V60 models.
It should come as no surprise that Volvo is looking to leverage its now-owned Polestar brand a little more than they have in the past. The automaker is also expanding the Polestar color palate with Icy White and Bright Silver in addition to the Black Sapphire and photo-friendly Rebel Blue shades available last year.
As in 2015, S60 and V60 Polestar models will be powered by a 345 horsepower, turbocharged,  six-cylinder engine.

Chart of the Day: America’s Favorite Expensive Vehicles in 2015’s First Six Months

TTAC best-selling expensive vehicles June 2015 YTD chart
So many upper-crust products sit at the top of their respective automaker’s lineup and do little more than look pretty. They are flagships, technological showcases, standard bearers.
On the other hand, there’s the Mercedes-Benz S-Class, with its base price of more than $95,000 in the United States. Flagship? Yes. Technological showcase? That, too. Standard-bearer? Of course. But the S-Class is also popular.
6.4% of the non-Sprinter sales produced by Mercedes-Benz USA come from the S-Class.
Granted, that’s down from 7.4 percent a year ago, but even that figure is skewed by the expansion of Mercedes-Benz’s already massive lineup. S-Class sales are also down 5.8 percent through the first half of 2015 after sales reached a seven-year high in 2014.
Regardless, no vehicle with a base price beyond $70,000 sells more often in America than the S-Class, which now features both a sedan and a coupe, formerly the CL-Class.
2015 Cadillac Escalade & ESV
Incidentally, the next three best-selling vehicles on the list are SUVs. Mercedes-Benz’s own GL-Class would sit atop this list with 12,938 year-to-date sales, but GL pricing starts below $65K. That likely helps to explain some of the GL’s popularity.
Clearly then, this list doesn’t take into account costly versions of lesser vehicles, whether that be the $96K BMW M5 or a $71,415 GMC Yukon Denali XL 4×4. For one thing, sales figures for distinct trim levels aren’t made available by automakers. Additionally, there’s arguably a different level of prestige afforded to a car line that’s truly expensive in all variants. And what of the Tesla Model S? We still don’t receive reliable, monthly sales reports from Tesla, but HybridCars.com estimates 11,900 year-to-date Model S sales, including a surge to 2,800 units in June alone. The Model S’s base price is now $76,200*.
* This chart and article were filed before Tesla Motors’ announcement of a new, base-model Model S, now priced at $71,200 with destination.

New Buick Engine Powering New Buick Encore Around It

2016 Buick Encore
General Motors announced Monday a new trim for the 2016 Buick Encore that will use a new 1.4-liter turbocharged four, which will be the first application of a new global-engine platform. The car will go on sale this fall.
According to GM, the new mill produces 153 horsepower and 177 pound-feet of torque — an 11 percent gain in power and 20 percent gain in twist over the 1.4-liter turbocharged engine currently doing duty in the cute ute. The two engines share only similar displacements. The current mill is rated at 138 hp and 148 lb-ft of torque.
There’s also a new Encore trim called Encore Sport Touring and it has a spoiler and 18-inch wheels and body-colored door handles and back to the engine.
The aluminum block has been specifically built to reduce friction and increase cooling, GM said in a statement announcing the Buick Encore Sport Touring.
In addition to its aluminum block and heads, GM said low-friction piston rings, camshaft drive and a low-friction oil pump will boost efficiency. A steel crankshaft was used to reduce engine vibration, and steel connecting rods used with aluminum-alloy pistons with low-tension rings will cut weight without sacrificing durability.
The small engine will also use a variable-flow oiling system that matches oil supply with engine load, removing excessive oil pumping. Oil jets will help cool pistons to increase efficiency.
At the other end, the cylinder head has a water-cooled exhaust manifold integrated with its aluminum casting to speed engine warm-up, and gasket seals around the exhaust ports have been removed. GM says both measures will help efficiency and durability, as well as offer “under-hood packaging advantages.”

Report: Chevrolet Prepping for New Mid-size Three-row Crossover

Chevrolet will slot a new mid-sized crossover between the Equinox and Traverse in coming years,Automotive News is reporting.
Three sources within General Motors confirmed the new Chevrolet crossover would be dervied from Cadillac’s upcoming XT5, which is replacing the SRX next spring. The upcoming Chevy model’s architecture would be a shortened version of the Traverse, which is built on the Lambda platform. According to the story, GM will move the Equinox to the smaller D2XX platform — shared with the Chevy Cruze, Orlando, Volt, GMC Terrain and Opel Astra — by 2017 to make room for the three-row crossover.
The new, unnamed crossover will target the Nissan Pathfinder and Toyota Highlander and could be powered by a 2-liter turbo four, a 3.6-liter V6 or perhaps a hybrid power plant.
The report also details Chevrolet’s position to directly compete with Ford’s Escape-Edge-Explorer trio for crossover sales. The Edge isn’t a three-row crossover in the U.S. (it’s offered in three row, long-wheelbase configuration in China), but Chevrolet’s unnamed crossover would sport a third row of seats.
GMC would use the new mid-size crossover as their Acadia, as sales of that full-size crossover have dwindled in recent years. The Cadillac XT5 will go on sale next spring. There’s no mention of a Buick crossover to sit between the D2XX-based Envision and full-size Enclave, assuming the latter stays full-size along with the Traverse.
The story also said Cadillac won’t use the longer Traverse as a platform for a full-size crossover it’s working on.
Or, this could be an elaborate test to see if the market will bear yet another crossover.

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