30 May 2011

Land Rover Start Indian Manufacturing

Land Rover has just officially opened its first assembly plant in India at Pune. The facility will assemble the Freelander 2, sourced as completely knocked down (CKD) kits from Halewood, Liverpool, U.K. The Pune factory will be overseered by two experienced manufacturing and quality managers who have moved to India from the UK.

With German competitors already assembling vehicles in the country, JLR plays catch up once again. Hopefully the new management will have the company at least up with the play, if not leading on occasions.

28 May 2011

North America - Europe Brand Comparison 2010

Nth America and Europe car markets (without the Russian region) are very similar in size. Both are between 1.3 and 1.4 million sales, Europe the slightly larger. After that, the similarities are less common. Top end luxury brands are quite alike but the more mass produced a vehicle, the greater the differences. Europe has more brands on sale, many that do not make it to the US. The chart below shows this:

Major Brands (millions):

Brand/Nth Am/Euro
Gen Mot 2.460 - 1.190
Ford 2.200 - 1.100
Chrysler 1.290 - 0.036
Toyota 1.650 - 0.580
Honda 1.350 - 0.190
Nissan 0.880 0.400
Mazda 0.310 - 0.180
Mitsubishi 0.075 - 0.110
Subaru 0.290 - 0.045
Hyundai 0.660 0.360
Kia 0.410 - 0.260
VW 0.300 1.540
Renault 0.000 - 1.150
Peugeot 0.000 - 1.000
Fiat 0.000 - 0.850
Skoda 0.000 - 0.460

Japanese brands are so much stronger on the western side of the Atlantic whereas some big Euro brands do not even sell there.

Premium Brands (thousands):

Brand/Nth Am/Euro
BMW 247 - 610
Mercedes 255 - 590
Audi 116 - 625
Volvo 60 - 230
MINI 50 - 140
L Rover 35 - 67
Porsche 27 - 38
Jaguar 14 - 27
smart 8 - 83
Saab 5 - 21
Lexus 244 - 18
Infiniti 117 - 2
Acura 151 - 0

The Japanese divide is evident again, so Japanese cars do much better in North America right across the board. However, European premium brands sell well in Nth America when compared to mass market Euro brands. Super Luxury brands are surprisingly similar between markets.

In summary: Two markets of similar size but at the lower end of the price scale not much in common.

25 May 2011

Most Popular Model: Europe 1996 - 2010

Comparing top ten models within Europe for the last 15 years shows that there was not much change. Only 16 models have that distinction. 4 models were there every year and all the cars listed below were there at least 10 times (see Col 2). Only 4 have been number one (see Col 3), the VW Golf 9 times. Col 4 shows the highest ranking reached, the GM Corsa only reaching 4th as its best spot.

Rk Model Col 2 Col 3 Col 4
1 VW Golf 15 9 1st
2 GM Astra 15 2 1st
3 Renault Clio 15 - 2nd
4 Ford Esc/Foc 15 - 3rd
5 GM Corsa 14 - 4th
6 Fiat Punto 13 1 1st
7 VW Polo 12 - 3rd
8 Peugeot 206/7 11 3 1st
9 Renault Megane 10 - 2nd
10 Ford Fiesta 10 - 2nd

Many of these car models will be popular for fleet buyers, which gives them sales consistency. The Ford Escort/Focus is the most even, for 15 years falling between 3rd and 8th.

In summary: Over 15 years, little has changed and I cannot see much changing in the top selling models in Europe for the future either.

Pic: http://newcarwallpapers.org

23 May 2011

The Times They Are A Changin'

You better start swimmin' or you'll sink like a stone.
For the times they are a-changin'.

Those words of that classic song certainly applied to the US car industry. Their 'Big Three' car makers were once at the top of the tree but poor management saw them plunge, so far in fact that two recently got government bailouts to save them and the other just avoiding that fate.

For the loser now will be later to win
For the times they are a-changin'.

On the other hand, Japanese companies were doing well and Toyota went top of the world a couple of years back, passing GM. Then the global downturn pushed up the Yen to a more realistic value. Suddenly profits were vapourising and sales were falling. Now the Tsunami has rubbed salt into the wounds by affecting production. How much is hard to tell as I get the impression some car makers are playing it up more than it is, perhaps to minimise the already existing poor situation. Whatever the case, the disruptions of the 'quake have added hurt Japanese car makers and other brands around the world who source any parts there.

There's a battle outside and it is ragin'
It'll soon shake your windows and rattle your walls
For the times they are a-changin'.

So who will win this battle? The US car makers will surely take back share from the strong Japanese presence within America. The Korean duo surely will pounce as will VW. In Europe, the fairly low Japanese market share will diminish. Nissan is a Japanese brand going places so how they cope will be interesting.

Overall, the main winners from Japanese decline within the industry appear to be US and Korean manufacturers. One thing is certain: the times they are a-changin'

20 May 2011

Car Sales Lotus: 2010

Lotus makes light sports cars, with emphasis on lightness and handling. The owners, Proton, have big plans to increase the range of vehicles (I wrote an article on this not so long back, you can find it under labels 'Brand Britain'). So how are Lotus sales doing currently? Below are some markets for 2010. It is not comprehensive, but rather a list of what I know of some of the larger markets:

1 USA 660
2 UK 577
3 Japan 312
4 France 180
5 Germany 160
6 Italy 102
7 Switzerland 86
8 Belgium 68
9 Australia 53
10 Austria 22
11 Singapore 16
12 Luxembourg 13
13 Thailand 12
14 Netherlands 9
15 Denmark 3
16 Spain 2
16 Sweden 2
16 Litchenstein 2
19 Greece 1
19 Portugal 1
19 Estonia 1
19 Slovenia 1
19 Czech Rep 1
19 Latvia 1
19 Cyprus 1

I would like to be able to say there are many more markets I do not have data for, but it seems this cover most of them. Canada is an omission, but I cannot find data for that country. Japan and France are surprisingly strong, as is Belgium. The USA I cannot say with certainty that it is correct.

In summary: Lotus need to sell more cars and the planned new range will certainly do that.

For sales of other years, please click on the following dates: 2014, 20132012 and 2011.

18 May 2011

Nissan Sales Booming

In the fiscal year 2010, Nissan's global sales reached a record-high level. Nissan's global sales increased 19.1%, with vehicle sales growing from 3.515 million to 4.185 million units. For the full year, overall global market share was 5.8%. Sales figures to note:

China 1,024,000 +35.5%
U S A 966,000 +17.3%
Europe 607,000 +19.3%
Japan 600,000 -4.7%
Others 709,000 +28.2%

Some things I have noted:

1) The alliance with Renault is proving a boon for both brands.

2) Interesting designs coupled with reliability is a compelling combination.

3) The importance of a strong pressence in China.

Nissan is doing very well across the world. The recent earthquake in Japan significantly disrupted Nissan's operations, but they are confident in continuing the success.

16 May 2011

Toyota Doing It Tough

I commented some time back about Toyota making too many cars in Japan. It didn't matter when the Yen was held to an artificially low level. Recent monetary upheavals have scuppered that policy. Now with slumping domestic sales and market share, a strong Yen, the fall out from the Tsunami and VW closing in quickly on the world's largest car maker, tough decisions must be made.

One of those involves a stand Toyota has maintained for more than 30 years, that of keeping domestic vehicle production above 3 million units. This was done for the benefit of Japan's economy and employment. Toyota has now decided walk away from this policy and review its domestic manufacturing operations due to the new economic realities.

The truth is, it cannot afford to maintain this policy anymore, so production offshore will be increased. This is something that should have been acted on sooner but there is no choice now. It is only a matter of time before VW Group passes Toyota to become world number one. Toyota needs to fight back and reducing expensive domestic production is a start. In the meantime, Toyota has to sort out the damage that the Tsunami wreaked upon Japanese manufacturing.

Summary: Toyota is a little vulnerable, indeed is doing it tough.

13 May 2011

Jaguar On The Move

I was reading and article in at detnews.com quoting some 'experts', some saying Jaguar was in fine fettle, while others thought it was doomed. The negative ones said Jaguar needed volume to succeed, the kind the German brands generate. Certainly volume can help with profits but that is so simplistic, as there is much, much more to it. When Jaguar was making its biggest sales, it was raking up losses. It now makes money on much smaller volumes. So much for some 'expert' opinion. So what is needed for Jaguar?

A wider range of product. Jaguar only has three models, not nearly enough. With more models and sharing platforms where possible will make a big difference. Jaguar has plans to expand its range over the next few years, addressing this serious problem.

Seek cooperation with other car makers where practical. Not so easy this one but spreading development costs is a sure way to fatten margins. Not a high priority now but will surely be pursued sometime soon.

Be innovative with style and design. Jags have to look beautiful and glamourous. Snobbish buyers in this segment want cutting edge technology too but I can't understand why. The reason is the latest accoutrements are prone to fail. I would rather have a car without the latest gizmos, but actually keeps working. So balancing the two is a problem for all premium brands.

Make sure all models are top notch. Sticking a premium badge on an ordinary or poorly thought out vehicle will, in due course, undermine your reputation. The Audi A1 is a classic example of an very ordinary car going for top dollar. Audi threw a poorly executed vehicle onto the market and when you do that too often even premium car buyers (in my view slower on the uptake than everyday car buyers) will notice. All three Jags presently are top notch and all future models must be also. I firmly believe they will.

Now for Land Rover's and a summary, see below.

Land Rover On The Move

Having considered Jaguar, now for Land Rover. LR already has five models with a sixth about to arrive, the Evoque. The range will be quite broad at that point. It would be nice to go below the Freelander but I'm not sure there is a business case for that. LR is profitable, but this is something that they has to keep working on, as it doesn't take much to sink into the read in the highly competitive automotive market.

Seek cooperation with other car makers where practical. Sharing a 4WD platform with Jaguar would be a start. Of course, it should go further to other makes.

Be innovative with style, design & technology. Looking at the ugly and unimaginative offerings German brands come up with, LR is ahead of the field for style and design. BMW tried to be smart with the X6, but even they would say that was a mistake. A poorly packaged, bloated SUV of excess if ever I saw one. LR designs are on the money but the next models will be lighter for sure.
LR has to be careful with technology, as many already steer clear of the brand due to past reliability issues.

Make sure all models are top notch. A new Defender is overdue, and that is coming. The Freelander (LR2) is beautifully proportioned but understated. The rest are awesome in this area. Overall, the best range of SUVs by far.

The JLR summary: The brand now has a hands-off owner, letting the brands flourish. They have excellent people in charge leading them forward. Some experts see no future in JLR, but then some experts said the Range Rover would fail when it arrived. If you are in the market for vehicles in the segment that Jaguar or Land Rover compete in, think beyond the boring Germanic offerings and get some style into your life. JLR is going places.

09 May 2011

The Car And The Real Person

If you want to know what someone is really like, watch him or her drive a car. People can be polite when moving around others in a crowded area, be polite in letting others through a door first or when negotiating around a supermarket with a shopping trolley. But when they get into the car, does that considerateness continue, or do they become belligerent and intolerant?

The fact is people who may behave decently face to face can become tyrants behind the wheel. Why is that? There is something about the disconnection a car makes between you and others. That leads to the person dropping their guard and letting the real person come to the fore.

My father was a polite man in public, but his manners continued behind the wheel because his core persona was not aggressive. Others show how nasty they can be when cocooned behind the sheet metal that is a car. So if you wonder what your true personality is, how do you conduct yourself on the road? Is it mild tempered, considerate and yielding, or perhaps do we get angry and explosive at the slightest upset?

Attitudes and feelings are moldable, so being milder of spirit when dealing with others is achievable. By showing courtesy on the road, and be patient with other motorists - and pedestrians too - we prove we can a better person in the way we treat others...even behind the wheel.

06 May 2011

Conservative Car Buying

Many people would probably think that when buying a new car, they are broad minded. Some are no doubt, but not many. I say this by looking at car statistics. If people are indeed open minded about their car choice, then we would see more fluctuation between brands on sales charts. The reality is that in any given country, certain brands dominate a segment year after year, and others consistently fail to do so.

Of course, there are many reasons why, but the one focued on here is the reluctance many have to venture into new brands. What shapes private car buying decisions? A few are listed below:

1) A conveniently located dealer. Most people are not going to go too far out of their way unless they really want a particular model badly enough.

2) Loyalty: Some want to support a marque that is from their own country. Others may never consider an import brand to avoid a negative impression in the minds of others of disloyalty. For example, statistics indicate that German premium car buyers are very narrow minded when choosing a car. A Lexus for example? I don't think so.

3) Prejudice: A buyer may avoid a brand he has heard has had reliability issues in the past, even it no longer holds true. I read even now of people saying they would never buy a Jaguar due to this issue. Basic research would show Jaguars are generally reliable now. Car buyers should try to be more informed and up to date on such things.

4) Snobbery: Others only go for a car that they feel gives a certain positive impression to others. Why not buy a car that satisfies our real needs, not our ego (or our insecurities)?

To keep an open mind when buying a car, why not:

1) Find out which models that suit our real needs.
2) Search for the dealers that carry them.
3) Go to the dealer, look the car(s) over, have a reasonably good test drive.
4) Finalise a short list of which cars meet your needs, then haggle to see who has the sharpest pencil.
5) Don't be pressured to sign on the dotted line, but go home and weigh up value, quality, resale price and practicalness.

Then decide. You may end up purchasing a brand you had not thought of at the beginning of the process.

In summary: Be prepared to broaden your horizons when buying a new car.

04 May 2011

Sinking Saab

If you click on 'Brand Sweden' to your right, there you will find an article I wrote "Can Saab Survive?" I really could not see it lasting long, and felt surprised that anyone would risk money with it. Well now suppliers are not getting paid and withholding stock until they do. Saab's are getting back in production again by raising more capital. To do so, Spyker sold a 30% stake to Chinese firm Hawtai in return for sharing manufacturing and technology. Hawtai make a couple of medium sized cars and Hyundai SUVs. They have been using Hyundai technology but this seems to have ended in 2010. Getting hold of Saab technologies could be a boon for them.

Does this mean that Saab may eventually become the same as MG Rover, uplifted and moved to China? That would be its only hope as I see it. The car industry has too many brands and Saab has product that is off the pace. I feel for the uncertainty the workers must be feeling, but things do not look good for them.

In summary: Another lift and shift to China is on the cards here.

02 May 2011

The Uncertainty In GM Car Making

I must be a cautious person by nature. I don't just read something and swallow it. Recently the BBC quoted GM Europe chairman "The future of car making in the UK could be in danger if the industry fails to develop a British-based supply chain." It was a strong statement but something does not seem right about it. Nissan, Toyota and Honda all make cars in the UK and never talk of pulling out. They have all made long term commitments to UK manufacturing. So why is GM coming out with this sort of talk?

Let us look at some facts about UK car making. Nissan and Honda - make three models each, Toyota - two models, GM - one; the Astra. It seems that GM don't really want to be there with only one token model. Profitabiltiy is improved with more models too.

None of the Japanese brands talk of pulling out of UK but GM is always suggesting any current model could well be the last made at Ellesmere Port, UK. The Japanese brands make long term plans and thereby promote security, GM talks up reasons to leave, promoting uncertainty. If GM want suppliers to invest, maybe GM itself should reassure them of its long term plans to stay.

What I have learned: That Japanese companies show loyalty to their workers and promote stable car production. GM has a cynical attitude of creating uncertainty as the best way to run their business. I cannot say I admire GM policies and their inability to make money in Europe is because of the way they do things.