Road Reality » Industry Status

Ford’s sale of Volvo: Complete. Geely’s cost: $1.8 Billion

John Suit — Mon, 02 Aug 2010 14:03:30 +0000

Well, it’s finally happened – Ford completed the sale of Volvo to Geely, the Chinese automaker. Geely forked over 1.8 billion, according to a press release by Ford. Most of it was in cash, but there was also a $200 million “note” involved.

Under the agreements of the sale, Ford will be sharing with Geely tooling, intellectual property, stampings and other car-related materials, as well as engineering support, for differing amounts of time. This gives Geely’s employees a transitional period of help, and I’m sure it also works out to Ford’s advantage, letting them keep an eye on Geely while they have access to Ford’s inner sanctum.

The sale of Volvo lets Ford focus on their core brands of Ford and Lincoln, not to mention their professional relationship with Mazda. The downside of this is that Ford has been using Volvo’s hardware for years to boost its own products. Volvo-sourced drivetrains and platforms are currently underpinning the Lincoln MKS, MKX and MKT, as well as the Ford Taurus, Edge and Flex.

Of course, this is forgetting Ford’s current quality and technology push, both of which have garnered the automaker high praise in the last 12-18 months. I’d look for Ford to develop some new platforms to go underneath new sheetmetal when its vehicles are refreshed over the next several years, pulling away from the Volvo stuff and going with new and better setups.

Meanwhile, good luck to Volvo and its new owners, as the niche automaker has only sold 28,206 vehicles from January to June this year. I project Volvo’s sales to be around 56,400 for 2010, if their current monthly sales continue as-is.

by John Suit

Source: Ford

Consumer Reports’ Top Picks for 2010

John Suit — Thu, 25 Feb 2010 15:00:53 +0000

Each year, Consumer Reports rates new cars, and publishes a list of their “Top Picks.” Each year, they pick the best overall winners in several categories, and there are usually a few winners with Honda or Toyota badges on them. This year is a bit different, with Nissan (including Infiniti) winning a couple of awards. With all the Toyota recall hubbub, it’s not too surprising to see the list change, but the biggest surprise for me was the Nissan Altima winning Best Family Sedan. Read on for the complete list.

The Nissan Altima has been a fairly popular seller since its complete redesign in 2002. Since then, it’s seen minor changes here and there, but no changes as complete as the ’02 model. Given its age, I was surprised to see it, but having recently taken a test drive in one, I think Consumer Reports may be overlooking the Hyundai Sonata, at least the 2010 model. Pound for pound, the Sonata comes across to me as a better value. With Hyundai’s ever-increasing quality ratings, you’d think it might have beaten the Altima, but that isn’t the case here. Either way, here is the list of winners:

Family Sedan: Nissan Altima

Small Sedan: Hyundai Elantra SE

Sporty Car: Volkswagen GTI

Small SUV: Subaru Forester

Best Car Overall: Lexus LS460L

Family SUV: Chevrolet Traverse

Sports Sedan: Infiniti G37

Family Hauler: Mazda Mazda5

Green Car: Toyota Prius

Pickup Truck: Chevrolet Silverado 1500

For the complete release and review videos, click here.

by John Suit

Source: Consumer Reports

The Year in Cars, 2009

roadreality — Thu, 31 Dec 2009 19:53:22 +0000

Welcome to the end of 2009. Thank you very much for visiting the site and checking out all the new posts. Without readers, there wouldn’t be a reason to do this, so thanks! Also, as I’ve said before, if you know any of the managers or owners of any DC-area car dealerships, please drop me a line. We need access to more dealerships and their cars, for review purposes. If you like the site, let your friends know, and let’s make 2010 a year to remember! Read on for what I think of 2009, and where we’re headed in 2010.

As for 2009, a lot of people, and companies as a whole, will want to forget the entire year. Toyota saw its first loss year-over-year in seven decades of operating, and one of the biggest recalls in American automotive history. Domestic manufacturers saw sales decline in the double digits. Whole brands have been killed off, and companies have gone through bankruptcy. But, not all is lost. Lots of new and refreshed cars have been introduced, some to success in showrooms. The companies which went through bankruptcy have come out the other side as leaner, more competitive versions of their former selves, shedding dead weight and debt. While the Cash for Clunkers program spurred sales, overall sales are down significantly from 2008, predicted to be 10.5 million new vehicle sales.

One of the biggest winners this year was Hyundai. With its “Hyundai Assurance” program, they promise to help out those who buy a new Hyundai and later lose their jobs. Combined with their 10-year / 100,000 mile warranty and a lot of bang for the buck, they have been scooping up sales all year. On top of all that, Hyundai is building cars people want, and the American marketplace has seemingly forgotten all about their first forays into our market – cars like the Excel and Accent.

Cadillac won big with its CTS-V, besting BMW’s M5 in a Motor Trend competition. Their redesigned SRX is a sharp-looking vehicle with lots of potential. In other domestic news, Ford’s Fusion Hybrid has been getting rave reviews, including one by yours truly, and for good reason.

On the flip side, Toyota has been in trouble for the second half of 2009, with the aforementioned recall, over floor mats, of all things. Add to this the lawsuits over weak-roofed SUVs and rust-prone trucks, and it’s not been happy times for them.

It was also a year which proved my predictions true, as Ford is the domestic automaker best poised to gain serious market share in the coming year, and GM killed off its slow-selling brands and cars, and sold (or is trying to sell) the rest. GM is starting its revival, having shed Pontiac and Hummer, and most likely killing off Saab shortly. Chrysler is now controlled by Fiat, so it has a chance, if the Italians can figure out the American market and start introducing and marketing new vehicles.

It wouldn’t be fair of me to not share my thoughts going forward, so here you are: Sales in 2010 of new vehicles will top 12 million, but don’t expect much more than that, as we are still in a recession. The cars that will drive these numbers will be small, like Smart’s ForTwo but better, if not cheaper. Higher-content small cars will be all the rage, and car-based SUVs and crossovers will still be better sellers than truck-based ones. Watch out for trucks, whose sales will be slightly higher than in 2009, unless another gas price hike occurs.

The big winners next year will be Ford, BMW, GM, Honda and Hyundai. They have new models coming out, or already in showrooms, and have held their sales up (comparatively speaking) in 2009.

Now for some fun stuff! Here’s a list of my favorite 5 posts here on Road Reality for 2009 (and why):

1. Toyota’s 3.8 million vehicle recall – The car company best associated with reliability and quality is in big trouble – rather big news, isn’t it?

2. 2011 Ford Mustang GT Information – Ford finally gives the Mustang a competitive engine! Also, click here for information about the V6 Mustang.

3. Review of the 2010 Ford Fusion Hybrid – Hey, it’s Motor Trend’s 2010 Car of the Year, what’s not to like?

4. Review of the 2010 Dodge Nitro – Surprisingly good SUV from Dodge!

5. Motorcycle Self-Assembly – Very cool project by a father and son, and entertaining to watch.

by John Suit

Industry Update: Top-Selling Vehicles of 2009

roadreality — Tue, 29 Dec 2009 15:00:10 +0000

2010 F-150 Front

For automakers, 2009 has been tumultuous, to say the least. With all the troubles manufacturers have had, it’s no surprise that year-to-year sales are way down. Whereas 2008 saw the sales of 13.2 million vehicles, that number was down from 2007′s sales of 16.1 million vehicles. Sales in 2009 are predicted to be around 10.5 million, a precipitous decline. Despite the overall slump in sales, there are still winners and losers. AutoBlog does a good job of listing them, so click here to see their list, complete with pictures. Click through the jump to see the list here.

The list, sans pictures, is as follows:

10. Honda Civic
9. Ford Fusion
8. Honda CR-V
7. Ford Escape
6. Nissan Altima
5. Honda Accord
4. Toyota Corolla
3. Chevrolet Silverado
2. Toyota Camry
1. Ford F-150

by John Suit

Source: AutoBlog