The most frequent topic of conversation among automotive scribes attending this year’s Paris Motor Show was what, if anything, was the common thread. Several dozen new vehicles made their debut in the City of Lights, from the little Citroën C2 to Ferrari’s big F430. Yet there were none of the blockbuster introductions traditionally found during Europe’s big autumn show. And perhaps that was the real thread linking the industry together. Where manufacturers have traditionally sought the automotive equivalent of a home run, that’s no longer the way the game is being played. The European market has become, if possible, even more competitive. The continental economy is soft, real prices have been slipping a percentage point or more each year, and the Asians are positioning themselves for the same sort of assault that gobbled up vast amounts of share in the U.S. So, if anything, European automakers are striving for solid singles and doubles. They’re filling in the gaps between model segments with products like the Mercedes Grand Sport Tourer and Lancia’s B-Kini. Innovations are often small and modest, like the fixed center hub in the little Citroën, which allows some of the indicator lights to be displayed on the steering wheel, rather than on an overcrowded instrument panel. With even more marques than the U.S., analysts have long predicted a shake-up in the European market. The problems faced by mass-market brands, such as Fiat, Ford, and Opel, suggest that it’s getting tough to survive. But as this year’s Paris Motor Show makes clear, no one is ready to roll over. And as far as consumers are concerned, that’s good news, because there’s more product than ever, targeted at every possible niche.
Breaking News: Sex Still Sells
“Cheesecake” was in clear view on the floor of the Paris convention center. Models in revealing wear helped draw crowds even if the cars on display wound up being ignored. Nowhere was the flesh factor more obvious than in the corner of the hall controlled by Italy’s Fiat group. At the Ferrari stand, the models’ custom-designed race outfits likely would have distracted even the ever-focused Michael Schumacher. At Lancia, several young women pushed the envelope, emulating the risqué Russian girl group, Tatu. Not all automakers opted to use skin to sell. At the Opel stand, many of the models were outfitted in lumpy jumpsuits that seemed better suited to the antiseptic sci-fi flick THX 1138. Meanwhile, BMW proved that it’s good to appeal to the distaff side of showgoers, too. The Bavarian marque had photographers posing male models, with carefully cultivated stubble on their well-sculpted chins.
2006 Porsche Boxster
Porsche Previews Boxster, Outlines Plans
After an eight-year run, the original Porsche Boxster is about to be replaced, but the second-generation roadster is not likely to catch you by surprise. The goal was "evolution versus revolution," insists the automaker's CEO, Dr. Wendelin Wiedeking. "Our focus is on small steps, but those we take more consistently and frequently." A more careful inspection reveals the '05 Boxster to be a bit more aerodynamic and sophisticated, with a wider track and wider wheels and tires. Two engines are being offered, including a 2.7-liter, 240-hp boxer and the 3.2-liter flat six for the Boxster S. At 280 hp, it will launch from 0-100 km/h (0-62.5 mph) in 5.5 seconds. The new roadster will offer a wide range of standard and optional features, including available ceramic brake discs. All versions will feature six airbags, including what Porsche claims is the world's first application of head bags in a convertible. In a tip of the hat to the competitive nature of the sports car market, European prices will be reduced six to nine percent. In the
2006 Porsche Boxster
The Boxster has been a critical piece in the Porsche strategy. Indeed, without the roadster, "Porsche would almost certainly not be in business today as an independent company," conceded Wiedeking, during a Wednesday evening press preview. But times have not been quite so good for the Boxster lately. Originally launched in 1996, it has seen sales fall from a peak of 27,900 to just 13,000 this last year. "It's been a tough nine months for us," acknowledged Riedel, because "people knew (the replacement) was coming." Going forward, Porsche is trying to develop a more cadenced product roll-out strategy, the marketing and sales chief explained to TheCarConnection.com. That will mean a new product or variant, on average, every six months going forward. Where might a fourth major product fit into that line-up? A formal decision will not be made until 2005, Riedel insisted, though "we know what we want to do." The only clue is that, "Porsche will not have a model priced below Boxster," hinted Wiedeking. - TCC Team
Hyundai’s Fifth Sonata
With the launch of a European version of the Sonata, Hyundai is aiming to capture about 2.2 percent of the European market, company officials declared during the Paris Motor Show. They could be especially well positioned in light of the sharp run-up of the Euro. Gaining ground in Europe will also provide a market for vehicles Hyundai will no longer export from South Korea once its new U.S. assembly plant opens next year. To gain traction in Europe, the automaker expects to broaden its lineup, and is especially interested in moving up-market, Werner Frey, vice president of Hyundai Motor Europe, explained during an industry conference in Paris. “Shifting to higher-segment products is a key strategy for us in Europe,” he said, adding that Hyundai’s goal is to offer vehicles ranging from 9000 to 35,000 euros (around $11,000 to $43,000).
2005 Ferrari F430
Ferrari Launches F430
With a body styled by the legendary Italian design house, Pininfarina, the new F430 is the latest addition to the Ferrari lineup. The $160,000 two-seater will replace the aging 360 Modena when it reaches U.S. showrooms later next year. The heart of the new coupe is an aluminum 4.3-liter V-8 making 490 horsepower through a Formula One-style gearbox, an electronically shifted manual with paddle shifters behind the steering wheel. The system can shift gears in just 150 milliseconds. There’s enough power to launch the F430 from 0-60 in 4.0 seconds, and the car tops out at just under 200 mph. The F430 makes good use of Ferrari’s racing knowledge, with its electronically controlled differential and carbon-ceramic brakes. There’s also a system, called Marinetto, which allows the driver to adjust suspension settings without taking hands off the steering wheel.
Classy CLS Debuts
2005 Mercedes-Benz CLS 500
Mercedes Goes On Tour
2004 Mercedes-benz Vision B
Anchoring Mercedes' ABCs
2005 Mercedes-Benz A-Class
Workers Say Yes, But More Needed at PAG
Workers at Solihull, the British plant producing Ford’s Land Rover products, voted nearly two-to-one in favor of a new cost-cutting contract on Friday. The so-called “Road Map” should improve everything from operating policies to the work culture of the plant, according to Mark Fields, CEO of Ford’s Premier Automotive Group. “Generally,” said Fields, “there will be more flexibility in the plant, which was very important to the plan.” His goal is to achieve steady double-digit increases in productivity at Solihull for at least the three-year life of the contract. Even with the good news out of the Land Rover plant, Ford officials remain concerned about the health of the PAG. In the most recent reporting period, the luxury group lost $342 million, about a third of that because of the weakening dollar. The U.S. is PAG’s largest single market. The situation varies by brand, with Jaguar clearly the most troubled of the group’s marques. Earlier this month, it was decided to close the Brown’s Lane assembly plant in Coventry, the “spiritual home” of Jaguar. There are many advocates within Ford who want to see at least some PAG production moved to the U.S., but “right now we have no plans” to do that, insisted Fields. He quickly added, “In the medium to longer-term, I rule nothing out.” Despite recent setbacks, “we are still comfortable with the target” outlined in Ford’s turnaround plan, which would have PAG generate as much as $1.3 billion in profits by 2006, asserted Fields. That won’t give the subsidiary much time to get its automotive act together. There have been rumors that Fields might be recalled to the U.S., though he insisted to TheCarConnection that, “I’m in Europe and I’m here to stay.”
Hubbert Wants To Finish Up
He’s known to many as “Dr. Mercedes,” and to many, it’s becoming difficult to separate Juergen Hubbert from the high-line brand that he has closely guided for the past fifteen years. But at the end of the year, Hubbert retires, handing over the reigns of DaimlerChrysler’s flagship brand to Eckhard Cordes. It’s a challenging period for such a major change.
While Mercedes sales continue setting new records, the brand has seen its quality reputation tarnished as it slips in studies like the oft-quoted J.D. Power Customer Satisfaction Index. “Even if we have had a few bad years,” asserted Hubbert during an interview with TheCarConnection, “we have a solid and good basis” going forward. The problems “didn’t just happen in the last year,” he said, and they won’t be resolved overnight. But the dapper executive is convinced that the worst issues have been resolved, particularly with the faulty electronic systems that caused the majority of Mercedes’ quality concerns.
Hubbert was interviewed at the Paris Motor Show, where Mercedes rolled out an assortment of new models, including the second-generation A-Class and two new Grand Sport Tourer concepts. These, boasted Hubbert, “give my successor something to build on in the years to come.” Mercedes was one of the first proponents of world cars, vehicles that could be sold in virtually identical form, all over the world. Going forward, that will change, Hubbert noted. There will be more customization for specific markets, even if that means something as small as cupholders for fast food-addicted American motorists. That should also help Mercedes’ standing in the quality charts.
If there’s one topic where Hubbert seems genuinely disappointed, it concerns Maybach, the ultra-luxury brand he personal drove to market. Global demand for such vehicles “has diminished markedly” since Maybach was conceived, Hubbert conceded. The brand itself has had to trim back its sales targets from 1000 a year to an annual 600. “It’s not that people can’t afford these products,” Hubbert stressed. “It’s that they don’t want to be seen in them” at a time when there’s growing disparity between rich and poor, and more openly felt hostility towards the trappings of affluence. Yet even while Maybach is struggling, Hubbert noted there are “waiting lists” for the SLR, Mercedes’ $400,000 sports car.
Over the course of a 40-year career, Hubbert has appeared at more than 100 auto shows and countless product launches. He was originally planning to leave a few months earlier, turning over his duties to Wolfgang Bernhard, who’d been the well-regarded number-two executive at DCX’s Chrysler Group. In a stunning and unexpected move, Bernhard’s promotion was rescinded; he resigned from DaimlerChrysler a few months later. It was clear Hubbert did not intend to discuss the internal politics behind the shake-up, other than saying that Bernhard “was not the guy for the job. Wolfgang Bernhard was clearly a car guy and very capable, but at the end of the day, he didn’t fit into the culture of the company.” As for Cordes, Hubbert said, “He builds teams out of good and experienced people. To me, he is a first-class solution. I am very happy with him as my successor.”
Hubbert may be stepping down from his day-to-day duties at Mercedes, but he won’t vanish entirely, staying on for at least awhile as a member of DCX’s powerful executive committee.
Hesterberg Remains Optimistic
Is the glass half full or half empty for Ford of Europe? As he gets ready to return home after five years on the continent, Earl Hesterberg would much prefer to take the optimistic view. Ford’s long-struggling European operations are expected to lose $100 million this year, but that, noted Hesterberg, will be a more than $1 billion year-over-year improvement. And the odds are that the all-new Focus, Ford of Europe’s highest-volume car, launched in Paris, will propel the huge unit back into the black. There are some clear reasons to be optimistic. Ford is gaining traction outside its traditional core markets of Britain and Germany. It is especially strong in Spain and in Italy, where it is now second only to the national brand, Fiat. Getting things in shape has not been easy. During Hesterberg’s tenure in Europe, there have been two complete reorganizations, and several major assembly complexes have been shuttered, including the home base in Halewood, U.K. But as a result, Ford’s European factories are now operating well over 90 percent capacity. Until the cutbacks, it had barely been 75 percent. “I think we’ve got our organization pretty much right-sized,” declared Hesterberg, the head of sales, marketing, and service for Ford Europe. The problems in Europe certainly aren’t over, Hesterberg acknowledged. There’s growing competition from the Japanese and Koreans, steady deflation of one to two percent annually in auto prices, and the weak economy in Germany. “If the German economy improves, it pulls the rest of Europe with it,” said Hesterberg. This coming November, Hesterberg will return to the States. Two months later, he will take over as Ford’s U.S. marketing chief, following the retirement of long-time Ford veteran, Jim O’Connor.
Daewoo’s New Role
In its final days as an independent automaker, Daewoo seemed intent on emulating its cross-country rival, Hyundai. But trying to become a full-line manufacturer all but killed the South Korean car company, which was purchased by General Motors Corp. two years ago. Now Daewoo is being reborn, but as part of GM’s global empire, it has a markedly different role in store. Daewoo is “much more international,” explained Nick Reilly, CEO of GM Daewoo Autos and Technology, or GMDAT. And while the automaker will still market some products under its own name, it will increasingly provide vehicles badged under other GM brand names. Already, about a quarter of the Korean carmaker’s output is being sold as various Chevrolet models, according to Reilly. And as the primary source for Chevrolet’s expansion into Europe, that will increase to nearly 50 percent. As Chevy grows there, it will introduce models specifically designed for Europe. A hint of what’s to come is on display at the Paris Motor Show in the form of the Chevrolet S3X concept — a production version due to follow next year. While its long-time rival, Hyundai, is continuing to move up-market, Daewoo will stay focused primarily on the low and middle segments of the market, Reilly told TheCarConnection.