Month: May 2013

http://www.autonews.com/apps/pbcs.dll/article?AID=/20130516/GLOBAL03/305169995/new-s-class-key-to-boosting-mercedes-profit-margins-china-sales#axzz2TYz8JwpC It seems that Zetsche is not wanting to sell the new S-Class to the driver, but more to the passenger. The new S-Class will have…

http://www.autonews.com/apps/pbcs.dll/article?AID=/20130517/GLOBAL03/305189998/in-boost-to-gm-and-vw-china-resumes-incentives-for-foreign-auto#axzz2TYpsiFje   China will encourage foreign investment in order to increase labor-intensive projects in the central and western regions. This will reverse a policy created…

As Dan mentioned used car sales are down 6% in the first quarter of 2013. This is not good news for dealers. As we learned…

Out of everything we have learned in this class, what has had the greatest impact on me personally is the realization of the importance of being globally diverse. From various national economies taking downward turns, to devastating tsunamis, I have learned that if you aren’t spread out, you are taking a major risk.

In an increasingly interdependent world it is important to not only seek profit globally, but to spread risk globally. Metelsa is an excellent example, expanding to Russia and Vietnam. A slow down in the North American industry would hurt, but not totally devastate the company like a company with “all of its eggs in one basket.”

Safety, what is it worth? As an OEM you obviously have to produce a car to a safety standard that will allow it onto the road legally. But, how much should you invest in producing a safe car? Engineering hours aren’t cheap, and making a safe car takes lots and lots of them.

       The new Subaru Forester is the first of around 13 vehicles to get a “good” rating on new, more stringent, IHSA safety test. One has to wonder though, for Subaru, was it worth it? How many fewer cars would Subaru sell with a “4 star” rating vs a “5 star” rating?

Decisions like these are faced by automakers every day. Quality, in any area, is not cheap. What people see and touch is often prioritized above what is underneath. For example, would you rather buy a “5 star” safe car with paint that will people would bet it’s the latter. l after 2-3 years, or a “4 star” car with flawless, show quality, paint. For most people, Automakers make decisions like this, although maybe not to this exact level.

No doubt about it, China is HOT. Cars are being designed with the emerging market in mind. But are they being marketed there effectively? The…

Mini does something very well that makes a lot of other automakers very, very jealous. Mini sells more accessories and features then anyone else in the industry. Little customization options offered by Mini are a cash cow for the company. Those 300 dollar racing stripes cost next to nothing to produce or apply. With ever shrinking margins a strategy like this makes more and more sense.

Dodge has seen this, and they want in. The new Dodge Dart is about to get a whole host of new packages and options. Want new wheels and badges? That will be $400 please. Hopefully, the additional revenue from these packages and options will help Chrysler make a greater profit on its slow starting (sales wise) Dart.

Consumer Reports recently gave the Tesla Model S a score of 99 out of 100, and other media outlets immediately began proclaiming that the car…

Features which, in the past, were only found on premium models are now available on entry level models. From leather to feature rich infotainment systems, it is…

For most car companies profit margins are tight and made up for in the volume of sales. For luxury car companies the opposite is true.…