2004 New York Show: Final Words

April 12, 2004

2004 New York Auto Show Index (4/5/04)


No News That 1-Series is Delayed

2005 BMW 1-Series

2005 BMW 1-Series

Enlarge Photo
Recent news reports about the “delay” of BMW’s 1-Series to the U.S. give a false impression that the hatchback 1-Series launching in Europe this fall was ever intended for U.S. shores. In fact, BMW chairman Helmut Panke and U.S. marketing chief Jim McDowell said a year ago that the hatchback would not see U.S. daylight. Those comments were reported in TCC in 2003. Panke last week said that one of three designs for the second 1-Series design are still being discussed on the management board, and that the winning design will definitely be shipped to the U.S. When asked, Panke took only five seconds to mention the 318ti hatchback launched in the mid-1990s, a car that hit the U.S. with a thud despite BMW’s rising sales. “The U.S. simply does not hold hatchbacks, five-doors in high esteem.” Hmmmmmm. How do you account for the MINI’s success, a car whose upper price points are comparable to what BMW envisions for the 1-Series? “Reality is different for the BMW brand and the MINI brand,” says Panke.

Things are getting ugly!

The sudden shift in exchange rates is leading import manufacturers to scramble for cover. When the dollar bought 1.2 Euros and 125 yen, it meant big profits for manufacturers like Toyota, Volkswagen and Jaguar. Now the situation has reversed and looks likely to get even worse, lamented Infiniti General Manager Mark Igo. “It always gets ugly when you get below 100 yen to the dollar.” But importers insist they won’t raise prices to compensate — for now, anyway.

Nissan Needs a Starter car

Count Nissan among the companies who think it needs a model line to combat Hyundai and Kia in the $9,000-$13,000 segment. Ford, too, is trying to make a case for a model line below the Focus. Nissan thinks it needs some pizzazz below its entry-level Sentra model. “We have much younger customers than a lot of companies...certainly younger than Toyota,” said Nissan product development chief Jack Collins. Collins says it favors finding a model it will sell under the Nissan brand, not following the lead of Toyota’s Scion brand. Scion is a separate brand with a separate showroom at Toyota dealerships. Nissan has previously looked at selling its Micra small car in the U.S. as a kind of “cheaper MINI,” but a business case couldn’t be made for the car, which is sold in Asia and Europe.

J learns his math

There was a lot of talk about the return of rear-wheel-drive in New York, but it took only a quick tour of the Jacob Javits Centerto realize that the real news is the boom in luxury cars coming equipped with all-wheel drive. “You just have to put two and two together t realize,” explained Ford’s design czar, J Mays, “that if you don’t have all-wheel drive (at least) as an option, you’re not in the game.”


Retro remains

There’s been a lot of talk about the demise of “retro” styling, especially with the lackluster reception given the hotly promoted Ford Thunderbird. But it’s anything but played out in favor of new styling fads, asserted a testy Mays. “I didn’t know you had to have one or the other,” he said, adding that “I was under the understanding that it would be a better place if people had more choice in the marketplace.” As to the soon-to-arrive Mustang, Mays had some second thoughts about what to call it. Forget retro, he explained, noting, “We call it old school.”


Ford Hybrid Plans Beyond Ford; Volvo Hybrid Coming?

Ford has now announced plans for three gas-electric hybrid vehicles — the Ford Escape, Mercury Mariner, and the Ford compact sedan formerly known as Futura. Ford lost a legal challenge from Pep Boys over use of the name. But how about Volvo? Given Volvo’s fatter profit margins and the European demand for fuel-efficient vehicles, doesn’t Volvo make sense for a hybrid? “Absolutely,” says Volvo’s U.S. chief Vic Doolan. “I’d love to have a gas-electric hybrid and we are looking at it.” The car Doolan would like to see it in? He pointed to the XC90 SUV. Ford’s current hybrid system wouldn’t be sufficient for the XC90 weight. But Ford CEO Bill Ford says he is confident the second generation gas-electric hybrid system will be sufficient for Ford — and thus Volvo? — mid-sized SUVs.

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