The Truth About Cars » Brand http://www.thetruthaboutcars.com The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. Wed, 16 Jul 2014 04:01:57 +0000 en-US hourly 1 http://wordpress.org/?v=3.9.1 The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars no The Truth About Cars editors@ttac.com editors@ttac.com (The Truth About Cars) 2006-2009 The Truth About Cars The Truth About Cars is dedicated to providing candid, unbiased automobile reviews and the latest in auto industry news. The Truth About Cars » Brand http://www.thetruthaboutcars.com/wp-content/themes/ttac-theme/images/logo.gif http://www.thetruthaboutcars.com Lincoln Can and Will Come Back http://www.thetruthaboutcars.com/2013/04/lincoln-can-and-will-come-back/ http://www.thetruthaboutcars.com/2013/04/lincoln-can-and-will-come-back/#comments Wed, 10 Apr 2013 15:39:02 +0000 http://www.thetruthaboutcars.com/?p=484205

Over the last two years, attacking Lincoln has become tremendously “in.” This is because doing so will cause everyone to agree with you, which is sort of like when people complain about drivers in their hometown. Seriously: no matter what major city you visit, the drivers there are “the worst,” according to local residents who have obviously never visited Italy.

The latest industry observer to attack Lincoln is David Kiley, who wrote an editorial yesterday for Autoblog entitled “Lincoln needs a farewell address, not a new marketing plan.” This received a generally warm welcome, which mirrors the one Kiley will get in tomorrow’s Detroit Free Press for writing an op-ed piece called “Detroit Drivers Are The Worst.” The latter story would probably win him a Pulitzer, except the committee is in New York and they are absolutely certain Manhattan drivers are the worst.

The only problem is that all of the Lincoln doubters are wrong.

Before you say it, I’m well aware of what you’re thinking: I must be crazy. Regular readers already know this to be true, since I owned a Range Rover Classic. But for those who need more proof, here it is: I have absolutely no idea how Lincoln will come back. I won’t lay out a marketing plan as Kiley did, despite announcing in his title that Lincoln doesn’t need one. I just know they will.

How Do I Know?

To me, there’s one clear reason Lincoln can revive itself: it’s been done before with much less.

Take Porsche, for example. Many of you are aware I once worked for Porsche, though my former superiors may object to my use of the term “work.” Either way, I woke up every morning and drove to the office. Twenty years ago, Porsche’s lineup was about as stale as Lincolns. Back then, Porsche offered three vehicles; the 928, which came out in 1977, was the newest. They sold as many cars in 1993 as they do now in a good month. The best car they were building had a Mercedes-Benz badge on it. And the window stickers were hand-written by someone who majored in calligraphy. (OK, some of this may be slightly inaccurate.)

Of course, the David Kileys of the time probably wrote Porsche off. I don’t have access to any of these articles, but I bet they had headlines like: “Porsche Needs a Farewell Address, and Stuttgart Drivers Are The Worst.”

Audi is the same way. In the early 1990s, Audi had precisely one reputation: the brand that wasn’t quite as good as BMW at anything except making cars that accelerated when you pushed the brake pedal. But in 1996, Audi rolled out the A4 – and just ten years later, everyone who was formerly not using the turn signal in a BMW was now not using the turn signal in an Audi.

Of course, Audi and Porsche are just small-time German car companies now joined at the hip by the automotive equivalent to Napoleon. How are they relevant to Lincoln?

Fine. Forget Audi and Porsche. It’s coincidental that the subject of Lincoln comes up (not really, I brought it up) since just yesterday I posted a review of my former 2004 Cadillac CTS-V. In it, I made the point that the CTS was Cadillac’s first real post-Escalade attempt to turn the brand around. Following the CTS came dozens of other efforts, some of which were good (ATS, SRX) and some of which were quite awful (DTS, that Escalade pickup thing). But by now, everyone agrees Cadillac has enjoyed a complete rebirth from a hole of obscurity they were facing just seven years before the CTS came out, when their flagship was the vinyl-roofed Fleetwood Brougham.

Back to Lincoln

Two things set Lincoln apart from Porsche, Audi, and even Cadillac. One is, very obviously, money. Lincoln has it. We know this because Lincoln is part of the Ford Motor Company, who awards Alan Mulally an eight-figure bonus every time he tells that joke about how the company’s been going out of business for 40 years.

The other thing is even more obvious: talent. Lincoln has that, too. Mulally may earn big bucks, but it’s because he and his staff have already done the impossible once before. These are the people who orchestrated Ford’s transformation from automotive obscurity to a constant front-runner. Except, of course, in the hallowed “outdated, large rear-wheel drive sedan” segment. Sorry, TTAC.

Those who complain about Lincoln’s current lineup are too shortsighted to see the brand’s limitless possibilities. Surely, there were doubters when Porsche launched the Boxster; when Audi debuted the A4; when Cadillac came out with the CTS. And I bet we don’t have to dig very deeply to find articles labeling Ford “dead and buried” when their best car was a full-size sedan called the Five Hundred. But every one of those brands proved the pundits wrong. So will Lincoln.

No, I have no idea how Ford will revive Lincoln, and I’m not going to provide suggestions. Because considering the wonders they’ve worked with Ford, Mulally and crew don’t need my input. They just need to work hard, and do their best to avoid those awful Dearborn drivers. Really, they’re the worst.

Doug DeMuro operates PlaysWithCars.com. He’s owned an E63 AMG wagon, road-tripped across the US in a Lotus without air conditioning, and posted a six-minute lap time on the Circuit de Monaco in a rented Ford Fiesta. One year after becoming Porsche Cars North America’s youngest manager, he quit to become a writer. His parents are very disappointed.

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Volkswagen Plans Chinese Brand http://www.thetruthaboutcars.com/2011/01/volkswagen-plans-chinese-brand/ http://www.thetruthaboutcars.com/2011/01/volkswagen-plans-chinese-brand/#comments Fri, 21 Jan 2011 13:26:53 +0000 http://www.thetruthaboutcars.com/?p=381335

Ever since GM announced its BaoJun, ever since Nissan showed its Qi Chen and Honda launched its Li Nian, creating Chinese car brands has become all the rage. Volkswagen doesn’t want to be left out. Volkswagen, (German for “the people’s car”) plans a standalone brand for the people of the People’s Republic.

Volkswagen-China CEO Wolfgang Neumann confirmed the plans to Germany’s Handelsblatt: “A local brand is our opportunity to participate in segments where Volkswagen is not represented yet.”

Volkswagen wants to create a series of small cars at a low price. The cars are supposed to cost less than $10,000. (VW needs to work on this price point. There are small cars in China that can be had for less than half.)  Once Porsche is integrated, the yet unnamed Chinese brand will be number 11 in Volkswagen’s collection.

In 2010, Volkswagen sold nearly twice as many cars in China than back home, and they want to sell more. China is seen as key to Volkswagen’s plans of world domination by 2018.

Which of Volkswagen’s two joint venture partners in China will get the new car? That is up for discussion and negotiation. The contract with SAIC has just been extended until 2030. The current contract with FAW will expire in 2016, it will most likely also be extended.

Someone will most likely also have a chat with Suzuki: „Do you want to have a part of this, or do you want to continue playing the shy bride?”

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Fisker Karma: The Car That Changes Everything Except Advertising Cliches http://www.thetruthaboutcars.com/2010/08/fisker-karma-the-car-that-changes-everything-except-advertising-cliches/ http://www.thetruthaboutcars.com/2010/08/fisker-karma-the-car-that-changes-everything-except-advertising-cliches/#comments Fri, 20 Aug 2010 15:31:25 +0000 http://www.thetruthaboutcars.com/?p=363377

Why build the sexiest-looking “green car” to date, only to advertise it using cobbled-together promo clips and a royalty-free techno beat? Other than the fact that several production delays indicate that every available dollar should go towards actually making the Karma production-ready, of course. [via Jalopnik]

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Chart Of The Day: May Volume By Brand http://www.thetruthaboutcars.com/2010/06/chart-of-the-day-may-volume-by-brand/ http://www.thetruthaboutcars.com/2010/06/chart-of-the-day-may-volume-by-brand/#comments Fri, 11 Jun 2010 18:41:13 +0000 http://www.thetruthaboutcars.com/?p=358721

Thomas Olesen wrote in to request a May 2010 brand volume chart. His wish just came true. Your wildest US-market auto sales questions can be answered too, if you just send your request to editors@ttac.com.

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The Skoda Conundrum http://www.thetruthaboutcars.com/2010/03/the-skoda-conundrum/ http://www.thetruthaboutcars.com/2010/03/the-skoda-conundrum/#comments Thu, 11 Mar 2010 11:26:47 +0000 http://www.thetruthaboutcars.com/?p=348577

When the automotive historians look back at GM they will point to many factors as to why they fell. Some might point to the Unions, some may point to their lack of reliable products, others may even point to their shoddy dealer service. But one factor which undeniably led to GM’s bankruptcy is lack of brand management. If anyone questions the harm poor brand management can do, then, may I point you in the direction of the Cadillac Cimarron? Muddled brands leave people confused and wondering why should I stay loyal to this brand? Your brand is your stamp of a promise to your customer. Safe cars? Volvo or Renault. Reliability? Toyota or Honda. Driving dynamics? BMW. Now I raise this point, because people said that this problem was endemic to GM only. It was a GM-centric problem. But is it, really? Was it really a GM-only problem? Or did GM suffer from “big company” syndrome?  Well it seem there’s evidence that poor brand management isn’t just for American auto companies.

Der Spiegel reports that Volkswagen CEO, Martin Winterkorn, is utterly fuming at Skoda. What could the reason be? Profits? Well, they are down, but we’ll come to that later. No, the main reason why Herr Winterkorn is seething at Skoda is because Skoda is doing well. So, well, in fact, that their cars are now creating problems for VW cars, their main brand.

Let’s go back a bit. Reinhard Jung, the chairman of Skoda, is being sent into retirement at the age of 59. Sounds a bit young, especially when you consider that retirement age in Germany had been raised to 67. But Volkswagen is famous for its lavish early retirement packages.  As reported  at TTAC, Jung is being replaced by Winfried Vahland, President of Volkswagen Group China.

Why the change? Der Spiegel says that the “reason for Jung’s departure is that the Czech VW subsidiary is no longer performing the function it was meant to perform within the VW group…” Skoda’s raison d’etre was to make inexpensive, entry-level cars. Cheap and cheerful, one might say. However, all Skoda engineers had to work with were the Volkswagen cars. So they built them with more attention to detail, “with more love” as the word quickly was in Wolfsburg.  Skoda models come with those little extras which make a car special, which surprise and delight.  When the Skoda Superb came out, it had a feature, whereby an umbrella holder was fitted into the door (more recent version here) complete with umbrella. The Skoda Superb was one of only 2 cars on the market which had this feature. The other? Rolls Royce. Very quickly, word got around that Skodas were Volkswagens, but built better, with better features, and sold for less money. A Skoda became the smart shopper’s choice.

The end result of this is that the edge of VW’s two flagship cars (the Golf and Passat) is being lost on customers. German automotive magazine, Auto Bild, did a comparison test between the Skoda Superb and the VW Passat. The Superb was, well, Superb. Auto Bild said the Superb “simply offers more for the money…a lot more features, and even more space.”. The tester also found no difference in quality between the 2 cars.

Now, as you might suspect, all of this quality comes at a price and Herr Winterkorn knows this, which brings me to the second reason he’s angry at Skoda. Skoda’s profits have been falling. not only has the Czech Koruna been appreciating against the Euro, but all this Skoda quality comes at a price. Skoda pays its workers more in order to build the cars well. But in order for these cars to sell, they have to be priced with value in mind. Which means profits get cut, dramatically. You get a car with the trim of a VW Passat, with the price of a Skoda. That’s money out of Volkswagen’s pocket. And because more people are buying Skodas, the more profitable cars aren’t being sold at Volkswagen.

This is where Martin Winterkorn’s job gets tricky. He has to give the brands room to be themselves, but he can’t allow them to tread on the toes of other brands in the family (the fatal mistake GM made). GM allowed their brands to become the same as each other, to the point where each brand didn’t stand for anything. Not mention that Volkswagen now has a stake in Suzuki which means that’s another set of toes not to be trod on. Does Volkswagen have too many brands? Or can Herr Winterkorn perform the juggling act GM couldn’t do? One thing is for sure. Skoda is due for a “de-contenting diet” very soon. Bringing in the head guy from China suddenly makes sense.

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The Saab-Spyker Deal Explained http://www.thetruthaboutcars.com/2010/01/the-saab-spyker-deal-explained/ http://www.thetruthaboutcars.com/2010/01/the-saab-spyker-deal-explained/#comments Wed, 27 Jan 2010 15:29:12 +0000 http://www.thetruthaboutcars.com/?p=343152

It’s been a looooong wait and lots of nail biting for Saab employees and Saab enthusiasts around the world, but GM and Spyker have reached a preliminary agreement on a Saab sale. The deal includes amongst other things the rights to the Saab brand of course, the Trollhättan production facilities (which was important to Spyker – more on that in a bit), the rights to produce and sell the existing 9-3′s, the new 9-5 and 9-4x models. Former Saab CEO Jan-Åke Jonsson, who was let go when the liqudation of Saab started, will be reinstated as CEO. He, and Spykers CEO Victor Muller have been named the heroes of this deal – Jonsson for his endurance and stamina “He didn’t walk out the back-door as liquidation started – instead he started nightly negotiations, writes Aftonbladet.se in a tribute to Jonssons’ role. And Spyker’s Muller’s charm and persistence have also been mentioned as a crucial part in securing Saab from GM.

THE FINANCING

Financing for the Spyker/Saab deal is not entirely known, but Victor Muller have allegedly contributed with private funds to secure the deal. But when di.se asks him, he gets secretive. It’s mostly financed through loans, he says, but he refuses to specify sources saying “it’s about my own shareholder structure.”
What is clear is that he buys out the Russian black horse Viktor Antonov, which was a demand from both GM and the Swedish Government. Antonov will own nothinh in the new company, Muller says. But Muller himself will hold a 38% stake in the company. And Abu-Dabi based Mubadala will own 22,4%. The rest of Saab’s capital structure will consist of investment funds, each holding less then 5% of Saab”s equity. All this according to Muller himself, through di.se

THE DEAL

Under the terms of the deal, the following will take place.
1. Spyker Cars NV in Zeewolde, The Netherlands buys all Saab Automobile AB’s shares from GM’s subsidiary Saab Automobile Investment AB for US$ 74 million.
2. At Spyker’s general meeting later this spring, the Spyker NV*s name will change to Saab Spyker Automobiles NV. Saab will become a Subsidiary of SSA.
3. GM stops Saab’s liquidation and Jan Åke Jonsson and the rest of Saab’s manafgement is reinstated.
4. Payment to GM will happen in two stages: 50 million upon final contract signing, by Feb.15, and then 24 million by July 15 2010.
5. The contract between GM and Spyker are dependent on the €400m EIB loan. The Swedish government has said they will guarantee the loan, but the EU commission must approve the guarantee, and the EI Bank must grant the loan.
6. GM will partner in the new Saab Spyker for 7 years, by getting interest bearing preference shares worth USD 326 million (with a 1% voting rights). This is in practice a loan from GM to Spyker that is due Dec 31 2016.
7. Victor Muller will, through his privately owned company Tenaci Capital BV, resolve Vladimir Antonov from the deal. Antonov’s presence was an issue to GM and Sweden’s Gov’t.

SPYKER’S PLANS

Spyker’s plan for Saab includes production and sales of the existing 9-3 models, the new 9-5 and the new 9-4x ASAP, hopefully during April. Muller also wants to produce Spyker cars at the Trollhättan facilties. Today, Spyker are collaborating with Lotus, paying millions per year for development recources. With Saab Spyker these costs can be kept in-house. In an interview with AutoMotor&Sport.se, Muller also says Saab will not release a 1,2,3,4,5,6,7,8-series like Audi/BMW/Mercedes, but will instead concentrate on a few models. But he REALLY thinks the Saab Aero X is a model deserving to become reality. “At Spyker cars we know how to produce exclusive cars in small series, so…” he teases AMS

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Jan Åke Jonsson says in an interview with di.se that he reckons Saab will be profitable in 2012, which is when they will have finished the plan’s largest investments. Saab must sell 100,000 cars to be profitable, he says. Saab has consistently sold 100.000 cars, regardless of economic changes. “We’ll use this estimate even though we have quite a new model programme, so these figures could even be a conservative estimate,” he tells di.se.

Will this work, though? What’s the difference between this and the Saab-Koenigsegg Deal? The Opel-Magna deal? The Saturn-Penske deal? The Hummer-Tenzhong deal? Time will tell, but for the first time in a long, long time, Saab at least has a future to look forward to.

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What’s Wrong With This Picture: All The World’s Saab Owners In One Place Edition http://www.thetruthaboutcars.com/2010/01/whats-wrong-with-this-picture-all-the-worlds-saab-owners-in-one-place-edition/ http://www.thetruthaboutcars.com/2010/01/whats-wrong-with-this-picture-all-the-worlds-saab-owners-in-one-place-edition/#comments Wed, 06 Jan 2010 00:18:15 +0000 http://www.thetruthaboutcars.com/?p=340863 (courtesy:Jalopnik.com)

Ok, so not every Saab owner made it to the “Save Saab” rally outside of GM’s headquarters today… but local Detroit businesses did report shortages of pipe tobacco, leather elbow patches and quirk. All kidding aside though, is there a better illustration of the blind passion that automobiles so relentlessly inspire? These folks had to know that 20-odd people with signs wouldn’t make a lick of difference to Saab’s fate, but dammit, they drove to Detroit anyway. From as far away as New Jersey, Kentucky and Iowa, no less. Somehow that makes the inevitable schadenfreude seem a little less satisfying.

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Francisco Franco Is Still Dead, Saab Still Breathing http://www.thetruthaboutcars.com/2009/12/francisco-franco-is-still-dead-saab-still-breathing/ http://www.thetruthaboutcars.com/2009/12/francisco-franco-is-still-dead-saab-still-breathing/#comments Tue, 22 Dec 2009 00:48:49 +0000 http://www.thetruthaboutcars.com/?p=339895 Ho ho ho (courtesy:saabhistory.com)

Despite the flood of clumsy eulogies and “don’t worry about the Saab dealer, he owns a Porsche shop” stories making their way into the local media (usually a good sign of a sure thing), Saab may still have some kind of chance at survival (in some form). According to Spyker spokesfolks [via AFP],

Spyker has been in contact with GM today and continues to develop its proposal for the purchase of Saab. Spyker has extended the validity of its proposal therefore until further notice

Merbanco claims to have a new offer as well, as Saabsunited.com reports that they are working with a Swedish consortium that “does not wish to be identified unless they are successful in the bidding.” GM has not issued a statement about Saab today, perhaps because the release writers were too busy with the announcements of a new CFO and the Chevy Equinox’s victory in an “Urban Truck Of The Year” competition.

In any case, the Swedish government is preparing for the worst, announcing a $74m local job-creation fund for Trollhåtten. Which seems like a good indication that the Swedish government will not underwrite a far more costly renewal. Not that the glaringly obvious is letting Saab’s spokesfolks from doing their best Baghdad Bob impression. “We can still hope as to what the conclusion will be,” they tell AFP. Maybe it’s time to stop hoping.

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Spyker Stock Soars On Saab Speculation http://www.thetruthaboutcars.com/2009/12/spyker-stock-soars-on-saab-speculation/ http://www.thetruthaboutcars.com/2009/12/spyker-stock-soars-on-saab-speculation/#comments Mon, 21 Dec 2009 16:04:11 +0000 http://www.thetruthaboutcars.com/?p=339805 Slouching to the grave?

Shares in the Dutch boutique automaker Spyker soared 23 percent today, reports Reuters, as the firm’s last-ditch bid for Saab goes down to the wire. Spyker, which sold only 43 cars last year and had a market capitalization of only €26.6m as of last Friday, will hear back from GM on its Saab bid by 5pm today. According to Reuters, Spyker has restructured its ownership structure in order to alleviate GM’s concerns about its backing from allegedly mobbed-up Russian financier Alexander Antonov. GM had previously canceled its Opel sale in part because of concerns about its latest technology landing in the hands of Russian investors. Furthermore, Spyker says it that its new offer eliminates the need for a European Investment Bank (EIB) loan approval prior to year end. “We’re very confident we have put forward a proposal that can convince GM in time,” says Spyker CEO Victor Muller. From a more sober vantage point, Swedish Prime Minister Fredrik Reinfeldt warns “we should be careful about fueling new hopes in a situation where the people in Trollhattan, and at Saab and their subcontractors are thrown between hope and despair.”

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