30 May 2012

JLR In Good Health: 2011-12

One thing that I couldn't understand about British management was the fact they never talked up success. Maybe it was viewed as bragging, something not in good taste. If so, you would have to say German companies have excessive poor taste, as they talk up their achievements like no others. The fact is the public don't perceive saying how well you are doing as improper. JLR now does tell the world it is doing fine, and perhaps some overseas management influence has helped there. So for some of the facts for the year ending March 2012:

Pre Tax profit:
£1.5bn +34%
First Quarter '12:
£530m +77%

Total: 314,433 +27%
Britain: 60,000 +3%
Nth America 58,000 +15%
China: 51,000 +76%

Sales in markets such as Russia, Brazil and India are booming too.

Not only did profits improve for the financial year, they were the best in the last quarter. Profits are being used to expand the range of vehicles and keep existing ones competitive. Sales are now at record levels too. Owners Tata must be most pleased. Previous boss Ford was a dysfunctional company at management level and it never got anything like the benefits from the JLR business as it should. Simplifying its business to its core brand was needed. Still, it must hurt to Ford see how JLR is now doing.

JLR products are increasingly sort after. Letting the public know this is good for business, and putting out some hard data confirms this success. Such good publicity leads to brand awareness, desirability and enquiry. The above figures show that is now happening.

Pic of XF: onsurga.com

28 May 2012

The Hyundai i20

I went for a test drive in Hyundai i20. The list price in NZ is substantially too much, approaching NZ$27,000. This one was on special for 22k drive away, which sounded close to where it should be anyway.

It had all the basic things you would expect. It was roomy and plenty of light came though the well sized windows. It also drives well enough but if you want sharp acceleration, it disappoints. When you fold the rear seats down, it leaves you with a two level cargo floor. To me that is a half hearted effort from the designers. It limits the usefulness of the area and makes it little better than a large boot in a saloon car.

The salesman came with us and he drove for five minutes, then I did likewise. We then came back to the yard. I'm not going to buy a car with a test drive that short. With a couple of questions from my wife from the specification sheet revealed there were gaps in his knowledge. He also had do idea how to fold the rear seats for use as a hatch. Then suddenly it was revealed there was in fact was only one car left for that price, the demonstrator we drove. If they were selling brand new cars for that price, then a demonstrator has to be less.

Two things that really put me off was the uneven floored cargo area and especially the last minute reveal that we were actually being offered a demo car with no concession for that fact. The i20 is a very ordinary car that has to be at a very competitive price to be worth considering.

They had our car for a trade in price to be established. Back at his desk, he seemed keen to make a sale but professionally, the experience came up short. Salesmen on this town seem to take you for granted a bit.

24 May 2012

Fiat And Mazda Team Up?

The next Alfa Romeo Spider will be a Mazda MX5, built in Japan! The platform will be all Mazda, with unique body panels and engines to each brand. This is the way of the future. Mitsubishi already make SUVs for Peugeot and Citroen.

Both Mitsubishi and Mazda are not well placed. Mazda no longer has Ford to help defray expenses with. However, thanks to the Ford tie-up, Mazda currently has a competitive range of vehicles but that surely cannot continue by going it alone. Additionally, it only makes cars in Japan which must impinge on profits. Mitsubishi on the other hand has been struggling for some time now. Its cars are so poor; it has to sell them at prices that yield no profit, only its SUVs keeping it afloat. Making them for PSA is the way to go, but is that enough?

Fiat and Suzuki are getting cosy, including a newly announced co-operative arrangement in India. Other manufacturers are busily finding ways to cut costs by sharing development and production. The MX5/Spider deal should be successful. Although not significant in itself, it is nevertheless part of what is becoming the norm in the car industry.

Pic: http://www.thetorquereport.com

22 May 2012

The Toyota Prius C

I have driven hybrids but not enjoyed them. They are numb when accelerating and I'm not one for putting 'the pedal to the metal' as they say. They look ugly too. The Prius C looks OK and that is important. It does 3.9L/100km. In NZ it comes with a 1.5 litre motor with CVT transmission, and sells for NZ$31,000. That puts it over 10k under the Honda Civic Hybrid, which isn't very good. The Prius C handles well, with good ride but the get up and go is still an issue.

The hybrid car is getting better all the time. This is a car I should put on my shopping list. But would I? A similar sized Honda Jazz (Fit) sells for over $6k less. The fuel saving of the Prius C would take so long to recoup, I would have long bought another car. So still only for the eco-warrior, then.

For now, regular petrol cars win. Oh, and if the NZ government stopped taxing small diesel cars off the road, a small diesel would definitely be an even better option.

21 May 2012

Japanese Brands Falling In Europe In 2012

If you look at Europe minus the former Soviet nations (ACEA figures in other words), then Japanese everyday brands are retreating. They are particularly being hit by Hyundai and Kia.

Below we see the difference, with Jan-Apr 2012 percentages first and April only figures in parentheses:

Mitsubishi -32% (-38)
Honda -22% (+2)
Suzuki -17% (-22)
Mazda -12% (-9)
Toyota -9% (-13)
Nissan -4% (-20)

Hyundai +9% (+0)
Kia +23% (+19)

There is nothing between the Korean and Japanese brands except value for money perhaps. I assume that is why the two Korean brands are taking sales from them, especially Kia. Honda showed signs of improving in April, and Nissan's poor April may just be an aberration. Premium brand Lexus is up 10.5% for the four month but down 39% in April, relying almost solely on the CT200H model proving unsustainable.

In summary: Japanese brands that make cars in Europe will fare alright, but brands such as Mitsubishi and Mazda will struggle. The new CX-5 will help the latter in the short term only. Offering value and more exciting cars is the way forward for Japanese makes. Then they will take sales back from the Koreans, who otherwise make pretty drab cars.

16 May 2012

Car Market Nouvelle-Cal├ędonie: 1980s

Way back in 1983 (the earliest record I have), Nouvelle-Cal├ędonie had a small car market of just under 3,200. The big players were French, of course, and Italian. The top five were, along with market share:

1 Renault 692 21.7%
2 Peugeot 462 14.5%
3 Fiat 163 5.1%
4 Autobianchi 155 4.9%
5 Ford 148 4.6%

Total 3186

Things changed rapidly through the decade, and three years later the top five were:

1 Peugeot 810 20.9%
2 Renault 630 16.3%
3 Rover 285 7.4%
4 Ford 232 6.0%
5 Fiat 226 5.8%

Total 3875

I was surprised to see Rover so high, and that without Land Rover included. In 1987, Rover including LR was nearly 11%!

By 1989, the market was over double the figure a mere six years earlier. The top 10 by then were as follows:

1 Peugeot 1817 26.2%
2 Renault 1272 18.3%
3 Ford 504 7.3%
4 Fiat 402 5.8%
5 Rover 344 5.0%
6 Citroen 247 3.6%
7 BMW 245 3.5%
8 Opel 230 3.3%
9 Suzuki 198 2.9%
10 Toyota 195 2.8%

Total 6933

European brands dominated this small market, and still do even today albeit not to the same degree.

I would do more flashbacks but data for this era is hard to find. Thanks to ISEE, statistics for the 1980s is still available.

Pic: http://www.productioncars.com

14 May 2012

Work Practices

In many developing nations, workers rights are generally limited by the fact laws favour business and there are plenty to take your job if you don't comply. Wages are also low. It was like that once in western nations too, but labour laws were enacted to protect the workers.

There are those that feel that in some countries worker protection has gone too far and it undermines competitiveness. Britain went through a liberalising of labour laws some years ago and but much of the benefit was lost with an overvalued pound. The currency is now weaker and with the more flexible working conditions, building things in the UK is more attractive than many European nations as a result.

Many UK car plants for example run three shifts such as Nissan Sunderland. GM has said it would help it's Ellesmere Port plant to stay open if the workers accept three shifts. They have yet to decide. Jaguar staff at Castle Bromwich, Birmingham were asked to agree to compulsory Saturday work to assist the new F-Type production. The union said it agreed but the workers didn't.

How far should workers go to make building cars in developed countries more profitable? With the economic downturn still with us, making any money is hard for mass produced brands. In Jaguar's case, they need to maximise profits to expand their limited range of cars and really take the fight to their competitors. I guess the more workers compromise, the safer their jobs.

Vehicle Sales Peru: 2011

The Peruvian market is diverse. So many brands, many Chinese as is common in developing nations. The usual western brands are at the top. An asterisk after the brand means there were two entries for the make, which I combined. Despite the long list, many 'other' sales appear, which can only make you wonder what are all those sales doing unassigned to any marque. I would have added percentages on sales change but I have insufficient data to do it with.

I wrote to the source (Araper) to see if I could get more statistics, but am not sure if they will oblige. One lives in hope.

1 Toyota 24,507
2 Hyundai 20,366
3 Kia 13,513
4 Nissan 13,140
5 Chervolet 13,036
6 VW 7,631
7 Suzuki 6,826
8 Mitsubishi 4,057
9 JAC* 3,532
10 Renault 3,050
11 Volvo 2,241
12 Mercedes 1,942
13 Chery 1,800
14 Great Wall 1,782
15 International 1,522
16 Honda 1,432
17 Yeujin 1,342
18 Foton 1,316
19 Chrysler 1,313
20 Mazda 1,312
21 Dong Feng 1,144
22 Ford 1,107
23 Isuzu 1,090
24 Hino 1,045
25 Subaru 1,024
26 Peugeot 994
27 BAW* 953
28 Hafei 860
29 BMW 767
30 Scania 734
31 Geely 727
32 Ssangyong 713
33 Changhe 690
34 Jinbei 669
35 Freightliner 646
36 Audi 603
37 FAW* 600
38 Mahindra 577
39 JMC 571
40 Fiat 525
41 BYD 455
42 Zoyte 454
43 Gonow 426
44 Forland 419
45 Citroen 312
46 Joylong 272
47 Daihatsu 257
48 Jinbei 241
49 Iveco 230
50 Changan 226
51 Kenworth 220
52 Lifan 215
53 Howo 209
54 Sinotruk 203
55 Seat 185
56 ZNA 160
57 MG 156
58 Higer 140
59 Brilliance 137
60 Mack 123
61 Golden Dragon 122
62 CAMC 108
63 Land Rover 107
64 Porsche 99
65 MINI 95
Otras 2,767
Total 150,037

It seems a strong market, with solid sales.

Pics: toursonline; Prius - tuverde

08 May 2012

The Nissan Juke-R Is Coming....Be Scared

Nissan has decided to put into production its outrageous Juke-R crossover in a very limited run on build-to-order basis. I have been reading about it in NZ car magazines and I thought what a shame it will never reach the public. Well Nissan has the 'you know what' to do things that others won't.

Nissan say: "The 3.8-litre, 160mph Juke-R made its global debut in Dubai in January this year, attracting enormous attention and, as a result, Nissan has now received firm orders for three cars to be built. Two have come from a high-profile and well-respected member of Dubai society. Nissan will build more Juke-Rs upon request and will be taking orders in the coming four weeks, before production starts in earnest".

Gareth Dunsmore, Marketing Product Manager for the Juke, said: "The Juke-R was originally intended as a one-off concept to marry two of Nissan's most innovative models. But the reaction we had to the car in Dubai was amazing - people were making offers for the original on the street!

"With such a strong reaction, and with three genuine offers on the table, we decided we had to make the car a reality. We can't let down enthusiasts who are this keen to add to their collection of cars. The Juke-R has become something of a phenomenon and I'm enormously proud of the impact it has had. There will be more news to come on Juke later in the year."

I have always liked the idea of small car - big engine. We had a Leyland Marina with a 2.6 litre six, and it was so effortless. Not the same thing as this of course, but the over powered idea appeals. Unfortunately the Marina didn't get the chassis work it needed. The Nissan has, and it is manic! So Nissan, if you are prepared to do a very sharp deal for a blog writer down under....

Anyone wishing to register an interest in purchasing Nissan's over powered little Juke should contact Juke-R@Nissan.co.uk.

02 May 2012

Plant Closures In Europe...Not

Ford just posted another loss in Europe, $149m this time. GM loses money each year. Yet both are popular within the region, 2nd and 3rd respectively according to ACEA. GM knows it needs to close a plant at least, one of the three in Germany would be obvious. I'm less sure what Ford should do. Close its Belgium plant and move Mondeo production elsewhere? PSA, Renault and Fiat all have far too much capacity. They all need to close plants in their home nations.

All these companies have a common problem. European politics. Companies need to run profitable businesses or they will eventually fail. Governments know that closing a car plant is bad publicity. Politicians only think of the next election and getting voted back in. Each year the Koreans use their profits to make better cars. The Chinese brands are getting better. If Japanese brands make more cars offshore and become more profitable, then they will make a comeback too.

In the meantime, European operations will slip back as R&D is cut back, quality suffers and market share is eroded. Of course the 'here today and gone tomorrow' politicians won't be worried about that. They kept the short sighted public happy and got reelected. No wonder things in Europe are a mess.