Once again, GM’s overseas products don’t sell well in the U.S.

November 18th, 2008

In one of Peanut’s classic gags, Lucy told Charlie Brown time and time again that she’d hold the football for him so he could kick it, only to pull it away at the last minute.

American car buyers like to do this with GM. They say, “If only you offered the products you sell overseas in the U.S., we’d buy them.”

So GM gave this strategy another shot. The Holden Commodore is now available as the Pontiac G8, and the Opel Astra is available as the Saturn ASTRA.

Saturn ASTRADays supply–the number of cars in inventory divided by the number being sold each day–is around 60 when supply and demand are well-matched. With sales way down, this figure is up for everyone: the average for the entire industry is now 100 days. But the G8 and ASTRA still manage to stand out. Pontiac dealers have enough G8s on hand to last for 283 days. And Saturn dealers have enough ASTRAs on hand to last for 411 days–more than an entire year.

I’ve never seen a days-supply figure over 365 before. Well, at least they’ll have cars on-hand if the government does as some are suggesting and provides a tax credit for people who buy fuel-efficient American cars. Except that the ASTRA is made in Europe.

GM’s Lambda large crossovers, 2007 vs. 2008

November 17th, 2008

A year ago, and again nine months ago and six months ago, the 2008 Buick Enclave, GMC Acadia, and Saturn Outlook–GM’s ”Lambda” large crossovers–had about half the repair rate of the 2007 Acadia and Outlook (the Enclave wasn’t offered as a 2007). A clear case of waiting for the second model year of a new design, right?

Maybe not. Three months ago there was a modest uptick in the repair rate for the 2008s, from 44 successful repair trips per 100 vehicles per year to 53. Meanwhile, the 2007s had dropped a bit, from a high of 100 a year ago to 84.

2007 GMC AcadiaAnd in the latest results of TrueDelta’s Vehicle Reliability Survey, the 2008s increased again, to 63 successful repair trips per 100 vehicles per year, while the 2007s improved again, to 74. The 2008s still require fewer repairs, but the difference is no longer substantial–about one extra repair trip for every ten vehicles.

Both model years now have average repair rates.

This isn’t entirely bad news for the 2008s. If the 2007s are actually requiring fewer repairs in their second year on the road, then the 2008s should do at least as well as they age. Their repair rate should not continue to increase, and might even decrease now.

We’ll find out with the next set of results, in February.

Two red lights: Infiniti EX35 and smart fortwo

November 14th, 2008

The November results of the Vehicle Reliability Survey have been posted.

Two of the 179 full results are especially intriguing. Other sources of vehicle reliability information give the 2008 Infiniti EX35 and 2008 smart fortwo high marks–the Infiniti even placed first in its segment in one study.

Yet in TrueDelta’s latest results both models receive our new “red light,” to denote a high repair rate. What gives?

Most likely, the recency of the data. Others’ data was collected last winter or spring, when these vehicles were still very new. Our data covers through the end of September.

2008 smart fortwoIn the interim, fuel pumps started failing in EX35s, and shifters started getting stuck in park in fortwos. These failures don’t affect every car, but enough of them that the smart has an annualized repair rate of 88 successful repair trips per 100 vehicles, and the Infiniti racks up 136 per 100.

Neither is a major failure, but both sometimes require a tow. In both cases there have been other, scattered problems. But without these the cars would have received much lower (better) scores.

Both are also the sort of problem that an astute manufacturer will have already identified and corrected on recently produced cars. With TrueDelta’s quarterly updates, any improvement will be reflected soon after it occurs, quite possibly with the next set of results in February.

TrueDelta’s Traffic Lights: the clearest indicator of vehicle reliability

November 12th, 2008

I’ll admit it, I love data. And if I have a choice between numbers and pictures, I’ll pick numbers.

But many people would rather have a picture, or at least a graphic to go with the numbers.

So, starting with this month’s results, TrueDelta has a new graphic to go with the “successful repair trips per 100 cars per year” numbers that it will continue to provide.

When TrueDelta does something, it strives to do it better than anyone else. So if we’re going to provide a graphical quick indicator for vehicle reliability, we’re going to make it as easy to understand as possible.

Our solution: traffic lights:

                  

Can you guess which one means you should think twice about buying a car unless you’re ready to contend with an extra repair trip or two?

And if you want to know how many extra repair trips you’ll likely be dealing with, the actual repair rates are right next to the traffic lights.

You won’t find nearly as many red lights as green lights or yellow lights. Why not? Because there truly aren’t many models that warrant them these days.

I’ve got to admit that I enjoy the traffic lights myself. I wouldn’t advise using them as a substitute for the actual numbers. But as a quick indicator, to be followed up by a more careful examination of the results, they seem to do very well.

Considering a domestic car? My advice: wait.

November 10th, 2008

Unless you must have a car now, if you are considering a domestic car–or even any car that directly competes with a domestic car–I would wait. Many proposed measures to save the domestic auto industry would have the effect of cutting car prices by thousands of dollars. If you buy a car now, you could pay thousands more.

The most ambitious proposal was made today by retired execs Hal Sperlick and Don Runkle (Automotive News article, sub required): the U.S. goverment should provide a $3,000 incentive towards any purchase of a domestic car.

My initial reaction: such an incentive would be unfair in so many ways that it just won’t happen.

But it, or something like it, could happen anyway.

What is clear: for GM and Ford to survive (I wrote off Chrysler when Cerberus bought them), auto sales cannot continue at their current level. To boost auto sales in the current economy, actual purchase prices are going to have to come down. A lot. And if even one manufacturer cuts prices, the others will have to follow.

So, if you don’t want to pay too much, wait.

Ball fumbled just short of the goal line–will anyone pick it up?

November 4th, 2008

Every January, April, July, and October I closely watch the responses as they come in, a flood the first couple of days, a trickle towards the end. How many people will respond this time?

Well, for October 2008 (which technically ends tomorrow morning), a bit over 7,700, up from a bit over 7,000 last time. The response rate this time: 35.4 percent, down from 36.2 percent. Given the current level of economic distress, which has many people too stressed out to participate in non-essential activities (TrueDelta isn’t putting food on the table), not bad.

It looks like we’ll have 177 model/model years in the November results, plus partial results for another 175. This is up from 149 and 152, respectively, three months ago, and about where I hoped we’d be.

And yet, despite my best efforts, we still have two models–the 2006 Acura TSX and 2007 Jeep Compass / Patriot–that are a single response short of the minimum. In both cases we have plenty of owners signed up, and 24 of them have responded. The holdouts have been informed that 24 other owners need them to do what they signed up to do, and participate in the survey. Those of you who have responded know that it takes less than a minute when there’s no repair to report (and about 90 percent of the time there isn’t).

But in these two cases that 25th participant hasn’t been forthcoming. To put it figuratively, the ball has been fumbled a yard from the goal line, but no one has picked it up and walked it over the line. They all want someone else to do it.

Part of me knows this is to be expected. But it remains among the most frustrating aspects of conducting this research. Happy about the 177 results we’ll have, but not so much as to forget the two we’ll barely miss.

Jeep improves interiors

November 2nd, 2008

Well, now I know what Chrysler had been up to. Few if any new products are on the horizon–no surprise, since the company seems very unlikely to survive in anything resembling its present form. But every Jeep model except the Wrangler did receive an upgraded interior this year. Too bad they didn’t take this step back when Jeeps were still in demand.

I haven’t had a chance to check out the improvements myself yet. Most notable: all but the base trim Grand Cherokee and Overland get leather-upholstered door panels and center armrests. The Grand Cherokee also gets a leather-upholstered instrument cluster hood. Usually “leather upholstery” means that the main seating surfaces are leather, while everything else that looks somewhat like leather is actually vinyl. So Jeep is taking a step into premium luxury car territory with the 2009s. For anyone who didn’t buy a Grand Cherokee SRT8 because they interior was just okay…

Many have argued that if an automaker puts a few hundred dollars more into a car’s interior they can charge much more for the car, because the impact on perceived quality can be substantial. Well, Jeep appears to have bumped prices only about $200 to $300 to cover the cost of these upgrades. Since sales of these models are weak, they aren’t the best test of the conventional wisdom with regard to interior quality. But they are a test.

The Nissan GT-R sets another record: largest price increase

October 30th, 2008

Nissan launched it’s 480-horsepower GT-R supercar with a price of $69,850 plus $625 destination. A lot for a Nissan, but even in the current economy demand has been very strong–most of the 2009s have already been spoken for.

Sales are down and raw materials costs are up for all major automakers. So Nissan needs to find a few extra bucks anywhere it can. With the GT-R, this means a revised MSRP of $76,840, place an even $1,000 for destination.

GT-Rs have been changing hands for even more than the revised price, so I wouldn’t be surprised if additional price increases follow. But, at over $7,000, this one is already the largest I’ve come across.

They said “never again”

October 29th, 2008

Automotive News reports this morning that General Motors is “postponing nearly all of its product development spending in 2009 and 2010″ to avoid running out of cash next year.

Among many depressing stories to come out of Detroit lately, this is the most depressing yet. I remember the last time they took such a drastic step, in the early 1990s. It took over a decade to get product development back on track. In the interim all of General Motors’ products were at least a half-generation behind the competition.

Remember the 1995 Aurora? Stylistically, it was way ahead of its time even when introduced. Well, it was supposed to be a 1993, and would have been even farther ahead then. Same for everything else in the 1990s. The 1997 Corvette was also originally planned for 1993.

Beyond the impact on products, stopping product development programs is hugely expensive in the long-run. Much of the work that has already been done will now have to be redone, because market conditions will change in the interim. And there’s always a huge cost to starting anything that involves hundreds of people. So you don’t want to have to do it more than once if you can avoid it.

They said this would never happen again, that the long-term effects were so pervasive that just about any other steps should be taken first.

One very confusing bit: aren’t the federal loans supposed to be for new product development? If everything is stopped, where is that money going?

One thing I always gave GM vice chairman Lutz credit for was maintaining Chrysler’s product development spending through the early 1990s, when that soon to be dissolved company was last on the brink and he was second-in-command there. Not this time, apparently.

Why should anyone care about misaligned trim when choosing a car?

October 28th, 2008

Since at least the 1980s we’ve heard about how American cars lag on “fit and finish.” Namely, that the paint often doesn’t look as flawless, the interior plastics look cheaper, and the various gaps aren’t as tight and precise as those in the best foreign models.

In recent years, the domestics have caught up, at least in specific cases. But why should it matter, anyway, how well the hood aligns with the fender, or whether the parting lines on interior plastics (where the halves of the mold came together) are smooth and nearly invisible? There’s a point for those interested in the finest craftsmanship as an end in itself.

But what about those merely seeking a reliable car? What do these things have to do with reliability? A poorly aligned hood isn’t more likely to require replacement than a perfectly aligned one.

Well, the problem is that the things that directly affect long-term durability aren’t visible to the naked eye. Panel gaps and such are the only clues we have unless we disassembled the car. But if the car company didn’t put in the effort necessary to make the things we can see perfect, why would they have put in the effort with the things we can’t see?

So it makes more than a little sense to infer subpar reliability from fit and finish issues. If panel fits and interior trim are shoddy, then the rest of the car’s engineering was also probably less than thorough.

The opposite is less likely to be true, though. Even if a car company puts in the effort to get the fit and finish right, they still might have cut corners on the things we can’t see. After all, it’s human nature to put a bit more effort into things others can see.

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