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STUDY SAYS BUYERS GETTING OVER 11
PERCENT OFF STICKER
HONDA UNSURE ABOUT GM’S ONLINE PARTS
PARTNERSHIP
TAURUS, SABLE GET FIVE-STAR
RATINGS
HIGH GAS PRICES PREDICTED FOR SUMMER
GHOSN SPOUTS GLOOM AND DOOM
DIRECT
SALES GET THUMBS UP IN STUDY
CONSUMER REPORTS FACES
SUIT ON ISUZU REVIEW
TOYOTA UPS PRICES ON ECHO,
CELICA
GM’S SMITH TAKES OVER SERVICE PARTS
OPS
AIRBAG ISSUE HEATS UP
INTELLICHOICE NAMES VEHICLES WITH BEST VALUES
LEVINE LEAVES CHRYSLER/PLYMOUTH, JEEP
GM ENCOUNTERS INTERNAL THEFT
EUROPE CREATES NEW AUTO RECYCLING LAW
FIAT STIRS THE RUMOR MILL, DC’S LIPS SEALED
SHORT STRIKES FOR FORD U.K.
STUDY SAYS BUYERS GETTING OVER 11
PERCENT OFF STICKER A new study by CNW Marketing/Research revealed that car
buyers were getting more than double the discount they got 15 years ago on the
sticker price of a new vehicle. The study said that the average discount in 1999
was 11.3 percent below the sticker price – up from 5.1 percent in 1985. The
change was attributed to the fact that car buyers can get the dealer’s invoice
price from a variety of sources on the Internet, including directly from some
dealers.
HONDA UNSURE ABOUT GM’S ONLINE
PARTS PARTNERSHIP After indications that Honda was likely to join General
Motors’ new online parts supplier network called TradeXchange, company president
Hiroyuki Yoshino said it was skeptical of the need for such a program. After
stating that Honda did not have any issues with high inventories, an area the
program is expected to address, Yoshino said, "While there may be a place in the
U.S. market for a simple commodity car made from universally available parts, it
would be a pretty boring car and that’s not something we have a lot of interest
in."
TAURUS, SABLE GET FIVE-STAR
RATINGS Ford’s 2000 model year Taurus and Sable vehicles were awarded the
five-star safety rating for both driver and front passenger in frontal crashes.
The tests, conducted by the National Highway Traffic Safety Administration,
involve crashing the vehicles into a fixed barrier at 35 mph.
HIGH GAS PRICES PREDICTED FOR
SUMMER Government and private forecasters are predicting that gas prices
will continue to rise, reaching a potential all-time high by Memorial Day. The
high price of crude oil and short supply at refineries are attributed to the
rising prices. In addition, the government is expecting an increased consumer
demand over last year’s record high.
GHOSN SPOUTS GLOOM AND DOOM
Carlos Ghosn, COO of Nissan, told a group of Japanese business leaders that
Nissan needed to expedite its restructuring process quickly before it dies.
"Speed is a necessity, not a wish…We need to revamp it (the company) quickly
because if we don’t do it quickly, the company might not exist anymore," said
Ghosn. Nissan recently announced that it was expecting not to reach its target
group operating profit for the fiscal year, which ends March 31.
DIRECT SALES GET THUMBS UP IN
STUDY A recent study conducted by J.D. Power indicates that Internet
shoppers would prefer to purchase their vehicles directly from manufacturers if
they could. Of the 400 new vehicle buyers surveyed, about half said they would
buy direct even if they didn’t save any money. When asked if they would buy
direct if they could save $3000, nearly 70 percent said yes. J.D. Power
concluded that the results clearly indicated problems with the dealer franchise
system and that manufacturers should consider restructuring the system. Due to
state franchise laws and the cost of developing a distribution system, it is
unlikely that manufacturers will ever sell directly to the
public.
CONSUMER REPORTS FACES SUIT ON
ISUZU REVIEW A lawsuit, filed by Isuzu, against Consumer Reports
magazine began in Los Angeles last week. The lawsuit claims that sales of the
Isuzu Trooper dropped 50 percent after the magazine issued a poor review of the
vehicle in October 1996. The article, which states that the Trooper was prone to
rollover during hard turns, urges buyers to stay away from the vehicle. The
trial is expected to last two months and may focus on free speech
rights.
TOYOTA UPS PRICES ON ECHO, CELICA
Toyota will raise its prices on the 2000-model Echo and Celica sold in the
U.S. Four-door Echoes will now start at $10,395 for the manual transmission and
$11,195 for the automatic transmissions, representing an overall increase of
$100 for both versions. The Celica price will go up $180, now starting at
$16,875 with a manual transmission and $17,675 with an automatic transmission.
The new prices go into effect on February 28.
GM’S SMITH TAKES OVER SERVICE
PARTS OPS John Smith, the general manager of Cadillac, has been named as
William Lovejoy’s successor to head General Motor’s service parts operations.
The 49-year old Smith, who has been with GM since 1968, took the top spot at
Cadillac in 1997. Lovejoy recently took over as head of vehicle sales, service
and marketing for North America. A successor at Cadillac has not been
named.
AIRBAG ISSUE HEATS UP Parents
for Safer Airbags (PSAB), a safety group comprised of victims of driver and
passenger airbags, urged the National Highway Traffic Safety Administration
(NHSTA) to keep its 30-mph crash test for unbelted dummies. Automakers have
argued the test, saying that the higher speed requires a more aggressive airbag
that can harm children and small adults. The PSAB is lobbying for advanced
airbags that have safety features which protect unbelted occupants, without
harming belted occupants. Several automakers have complied with the 30-mph test,
which is currently optional, for the last ten years and have had no issues of
harm to individuals as a result of the airbag deploying. Separately, regulators
are slated to meet with NHSTA today to discuss developing a rating system for
child car seats.
INTELLICHOICE NAMES
VEHICLES WITH BEST VALUES For the 14th consecutive year,
IntelliChoice has announced its "Best Overall Value of the Year" (BOVY) awards
for cars and trucks that cost less to own than is typically expected of vehicles
in the same price range. Vehicles were assessed based on depreciation,
insurance, finance costs, registration fees, fuel and maintenance costs. The
2000 model year winners overall are:
LEVINE LEAVES CHRYSLER/PLYMOUTH,
JEEP Martin Levine, head of the Chrysler/Plymouth and Jeep division at
DaimlerChrysler, is leaving to head a division of the Omnicom Group, the world’s
largest advertising company. Levine will join PentaMark, which handles
advertising for many U.S. automakers, as president and CEO. DaimlerChrysler is
expected to announce Levine’s replacement soon.
GM ENCOUNTERS INTERNAL THEFT
Several executives at General Motors are thought to be the victims of
internal theft, according to local Detroit newspapers. The Violent Crimes
Task Force at the Detroit Police Department suspects a female contract employee,
who may have had access to sensitive areas of corporate management. It is
suspected that the woman sold or gave the social security numbers and credit
card numbers of several General Motors executives to criminals who then charged
$100,000 to $200,000 on the cards. Police, who have no one in custody, suspect
as many as 10 people may be involved.
EUROPE CREATES NEW AUTO RECYCLING
LAW The European Parliament endorsed legislation that will require
automakers to take on the cost of recycling old cars. The End of Life Vehicles
Directive, part of a plan to reduce waste left in landfills or incinerated, may
even require manufacturers to recycle cars made before the legislation takes
effect. Recyclers, such as companies who shred old cars for their sheetmetal,
don’t agree with the legislation, saying that there are other markets for
so-called waste materials. The recyclers indicate that companies who produce
plastics, rubber and polymer products for cars should also share the
responsibility with the manufacturers. Final details of the new law will be
decided on later this year.
FIAT STIRS THE RUMOR MILL, DC’S
LIPS SEALED Fiat board member Grande Stevens gave the first indication that
an alliance with another manufacturer may be in the works. "Fiat is actively
courted. I think that by the end of this year it must decide whether to go for
an alliance and with whom," he said. DaimlerChrysler, who has been widely
rumored to be courting the Italian automaker, declined comment.
SHORT STRIKES FOR FORD U.K.
Ford’s professional staff in Britain have decided to protest the impasse
between the union and the company by conducting a series of short strikes. The
worker’s union will strike for one hour on February 21, a full day on February
24 and February 29 as well as for three days beginning on March 3. Ford
spokesperson Anne-Marie Chatterton said that Ford has no plans to up its last
offer. "Our main concern will be to keep things moving so customers are not
impacted," she said.
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