Friday, April 11, 2014

Recallapalooza

Over the past several weeks, automakers have issued a large number of recalls.  The biggest news over the period of several months has been GM's ignition switch recall.  New GM head Mary Barra was required to testify before congress, and the company is under investigation.  The Wall Street Journal just posted a piece about the recalls that doesn't answer many questions.

As an auto enthusiast, I want to know what is going on with these recalls.  Why are so many happening?  Are companies issuing recalls in a fury while the public's attention is still on GM?  The WSJ piece cites a number of experts in the auto industry who suggested a variety of reasons.  Some experts said the automakers were being more proactive.  Others say it is in response to government auto regulators in various countries, and threats of huge fines and criminal prosecution.  Still, others suggest that the $1.2 billion penalty Toyota had to pay regarding the Toyota and Lexus unintended acceleration saga has scared the hell out of the other manufacturers.

There have been massive recalls from Toyota, Ford, GM, and others.  VW even issued a stop-sale of Passats, Beetles, and Jettas with the 1.8 turbo.  That is basically half of VW's lineup.

So, what is really going on with all of these recalls?  Fear?  Regulation?  Safety?

I don't know, but I think the result is going to be more expensive cars.  If manufacturers are going to get trigger happy on recalling their vehicles, they may start to raise car prices to include a "recall fee".  We won't see a recall-fee listed on the window sticker.  The price will just go up.  As ignorant as I am, there has probably been a recall fee built into vehicles for decades.  Now it will just go up.

The WSJ piece has a nice graph showing the number of recalls going up over the years.  Again, the question is, are vehicles built within the past few years lower quality, less safe, or have more defects?  Modern vehicle loans are being stretched out to 84 months and beyond.  These vehicles can easily reach 200,000 miles if owners kept them that long.  Powertrain and CPO warranties go up to 100,00 miles.  Modern vehicles are not hunks or rusting garbage, so why so many recalls?

If I had to guess about the cause of the current recall culture, I say it's the lawyers.





Tuesday, March 18, 2014

The European Invasion: Ford vs FIAT


The European Invasion has Begun



It is really happening.  The dream every car enthusiast has had about getting the forbidden cars from Europe has come true.  This invasion has taken place in a couple different ways.  Just about every single Ford car, except for the Mustang and Taurus, is a European vehicle.  On top that that we have the new Kuga as the Escape.  Ford recognized the products offered by their European counterparts were very compelling.  This transition was done with a lot of global planning and careful execution.

FIAT on the other hand, has been getting their products into the US as a result of their acquisition of Chrysler.  Therefore, we see the FIAT 500, 500L, Dodge Dart, and Jeep Cherokee.  Unfortunately, most of these products have had some challenges in the marketplace.  The FIAT 500 had a botched launch because of the head of marketing thought it would be a great idea to make Jennifer Lopez the face of the new ITALIAN brand.  The 500L is a nicely packaged vehicle, but has been criticised for it's styling and recent recall for the dual clutch automatic.  The slow selling Dart, which is a US version of the Alfa Romeo Giulietta, just laid off 325 workers due to lack of demand.  The Jeep Cherokee was just released and is apparently turning in some decent sales figures.

You can go down to your local Ford or Chrysler/Dodge/Jeep/FIAT dealer, and pick up the European vehicle of your dreams.  At this time, it appears that Ford's plan has been much more successful.  In February the Fusion was ranked 8th, Escape 9th, and Focus 18th in terms of best selling vehicles in America.  That is not too bad for a 3 vehicles with Euro pedigrees.

The next Euro launch for Chrysler that gives me pause is the new 200.  This vehicle is a midsized sedan, based on a larger Dart platform, and happens to be smaller than the Fusion and other leading mid-sized vehicles.  The dimensions of vehicles in the mid-size segment have been growing.  The competition is always looking for more rear passenger space, and Chrysler is launching a smaller car.  Not unlike the current 200.

It seems that Ford has done a lot of research to make sure their vehicles are winners on both sides of the Atlantic.  Chrysler on the other hand seems to be having trouble with everything except the Cherokee.

One of the known behaviors of car enthusiasts is that they champion European vehicles, and declare the vehicles should be sold in America.  When the vehicles are sold over here, the vocal enthusiasts do not put their money where their mouth is.  Ford on the other hand, has released a nice lineup of Euro vehicles that are a nice stylish evolution of the previous vehicles.  This has helped Ford stay ahead of the pack.


Thursday, March 13, 2014

Ford needs a North American EcoSport...Fast.

The SUV takeover is nearly complete!  Subcompact sport utility vehicles are taking over South America, Asia, and Europe.  Some in North America think it's a bit funny that the small hatch-loving Europeans are getting in on the SUV craze that hit America in the 1990s.  The SUVs they are craving are different, because they are small, but the demand is huge.

Jeep unveiled the new small Renegade SUV recently, and auto enthusiasts laughed.  How would American Jeep lovers ever consider this little Italian off-road ute?  Auto enthusiasts are often wrong, and market research is often right.  The Jeep Renegade isn't as much for the Jeep loyal as it is for the folks considering a Kia Soul.  You may not know it, but the Kia Soul is extremely popular.  The size and price is right for people, and that is what Jeep is going after.

In international markets Ford released a Fiesta-based SUV called the EcoSport, which was designed in Brazil.  The vehicle is selling well in many parts of the globe, but it is not yet in North America.

I mention all this because I see the sub-compact SUV being a huge market in North America in the near future, and Ford needs a player in this market before it explodes.

Vehicles like the Nissan Juke may be in this market, but is too funky to be taken seriously.  There is word that Honda will be releasing a Fit based SUV in North America as well.

Therefore, I believe that Ford needs to launch a next generation EcoSport sub-compact SUV in North America within 3 years.  The Fiesta is a great vehicle, but is due for a platform update.  It would not surprise me to hear that Ford is making ready a NA version of the EcoSport.  You see, the current EcoSport may be good for Brazil, India, and Europe, but we demand something special.  Therefore, a next generation EcoSport could go on sale in the US in 2016, while the current generation is still sold in other markets.

SUVs are more expensive than sedans, and tend to hold their value.  There is a huge market out there wanting a small SUV from $17,995-$25,000.  These customers would normally be getting into an economy car, but are now getting into a nice SUV for a little more.

The Jeep Renegade is probably going to the one of the best entries into this market.  Ford could wait and see how it does, but I think they should go all in now.

The Surface 2: The Un-iPad Pad.

Several months ago I acquired a new Microsoft Surface 2.  I own a MacBook Air, iPad 3, and use an Android phone.  I was very interested in the Surface RT when it came out, and made a special trip to the Microsoft kiosk at my local mall to check one out.  I thought it was pretty cool, but didn't see much in the Windows App Store, and wasn't in the market for one.  The Surface 2 with Windows 8.1 has a faster processor, better resolution screen, Microsoft Office, and other improvements over the RT.

The Highs

The Surface 2, like the RT, has some genius innovations that are not available in the competition.  The integrated two angle kickstand, 16:9 ratio screen, keyboard covers, ability to run two apps at the same time, and additional ports are some of the killer applications for the Surface 2.  The kickstand and keyboard make the device an amazing mobile platform.  I have the type keyboard 2, and the backlighting can sense your fingers over the keyboard.  It's a nice touch.

The simple fact is that Apple iPad owners can use iWork apps and Google Docs for productivity.  However, iPad users cannot match the convenience of the Surface keyboard cover.  I have a keyboard case for my iPad and they are bulky and awkward compared to the slick Surface.

Everyone says it, but the Surface 2 really is a productivity device.  The iPad is a web, media, and game device.  I have read stories by tech bloggers who have written all of their articles on the iPad while one the road, and how it has replaced their laptop.  I'm sorry, but to do that, you have to go in and out of apps on the iPad, because you can't have two apps running on the same screen like you can with the Surface.  As much as the Surface is a great productivity device, you start to wish you could have more windows open on the screen; like a laptop.

The Lows

The Surface 2 is not an iPad.  It doesn't have nearly the number of apps available.  It doesn't come close to the amazing music and video creation apps that are available on the iPad.

The worst feature of the Surface 2 is the fact that it does not run Flash on every website.  You see, the Windows RT operating system is not full Windows.  The only browser you can currently use on the Surface 2 is Explorer.  RT version of Explorer runs Flash only on sites that Microsoft has pre-approved.  I don't know why, but you have to remember it really isn't full Windows.  So, in many ways, the iPad is a bit more web compatible in video than the Surface 2.

Summary

Where does the Surface 2 fit in?  It's much smaller than my 13 inch MacBook air.  I use it at work.  I would not be able to use an iPad at work in the same way I use the Surface.  I have two thoughts.  One thought is that both devices can co-exist.  You have an iPad for light stuff at home, and a Surface to replace the laptop at work or on the road.  The second thought is that Apple could do major damage to the Surface if it adopted the killer features.  Apple, Samsung, and other companies have been involved in design patent battles for years.  Some companies just copy each other.  I would think it would be easier for Apple to make the iPad more productivity friendly then for Microsoft to catch up and make the Surface more app/entertainment friendly.  I just happen to like competition, and think each generation of devices improve by trying to increase marketshare.

Thursday, January 9, 2014

How about a Fusion Sport in 2014?


The new Ford Fusion has been a game changing vehicle.  It's making folks who were thinking about Accord, Volt, Prius, Passat, and others consider a Ford sedan.  You can get a huge mix of Fusions.  You have a choice of 3 gas engines, a hybrid, a plug-in hybrid, even an all-wheel-drive option.  In addition to the powertrain options, the exterior and interior of the vehicle are beautiful and modern.  It's a work of art within reach of the common man.

There are so many Fusion options, but just one is missing, the Fusion Sport.  I have no idea if the Fusion Sport is being considered, but it would be a compelling addition to the Fusion family.  I suggest Ford release a Fusion Sport in two offerings; one is front-wheel drive, the other is all-wheel-drive.  The front wheel drive option would be powered by a 2.3 liter Ecoboost engine for just under $30,000.  The second Fusion Sport would be powered by a higher powered 2.3 Ecoboost engine with over 300 HP and all-wheel-drive.

What other company offers a performance version of their midsize sedan?  Honda?  Toyota?  Kia? Nissan?  Chevy?  Sure there are a number of sedans that offer power, but power is different from performance.  Performance includes handling, weight, braking, and more.

Ford offers an Edge Sport and Explorer Sport with increased HP and performance over the other models.  Ford also offers an excellent Taurus SHO.  Unfortunately, the SHO has not captured the imagination of the country like previous generations.  Secondly, the SHO is quite expensive.  A new Fusion Sport would take the place of the Taurus SHO, and be a great value.  Heck, I don't care if they call the vehicle the Fusion SHO.

I suggest a FWD and AWD version because there are Focus ST junkies that like FWD, but need more room at a great price.  I also suggest the AWD version because it can better handle the additional horsepower.

We may see a Fusion Sport in 2014.  There was a previous generation Fusion Sport that had more horsepower than other models.  I think the folks at Ford are quite bright, and know they need to bring new versions of a vehicle to market throughout the vehicle lifecycle.  The Fusion Sport could be a reality, and it makes very good sense.