Housekeeping: More, More, More!
Hey there! We start this week with some TTAC news.
'Made in America Auto Index' Gives Ford Mustang GT the Crown
Annual automotive-content indexes have grown in popularity since trade restrictions and tariffs have become increasingly relevant issues. But they’re usually pretty generic, often providing the broad strokes of product origin while placing a few cars housing the most regional content on a pedestal. Not so with the Kogod School of Business’ 2021 Made in America Auto Index. While the metrics used are a little different from what’s found elsewhere, it offers a more comprehensive data set than other catalogs.
Though most people still like to know which vehicles were dubbed the “most American” and Kogod’s percentage-based scoring system makes it pretty easy to figure out. We won’t leave you hanging. For the 2021 model year, the Ford Mustang GT was evaluated as the car boasting the highest level of North American hardware and labor. But you have to get a manual transmission for the necessary 88.5 percent total domestic content rating (TDC). Select the automatic and that number drops to 51 percent, which is still better than the Mustang Mach-E’s paltry 15-percent score.
Reductive Design: Ford's Secret Recipe for Affordable Cars?
Despite the average transaction price of your typical automobile climbing higher than ever before, there’s a lot of disagreement as to whether this actually amounts to more spending once inflation has been taken into account. Studies frequently show inflation-adjusted valuations climbing gradually over the years, resulting in MSRPs a few grand higher than what you might have spent in decades prior. Still, newer vehicles tend to have a much greater level of content and the ability to outlast something from 1970, helping to rationalize the difference. Data taken from the U.S. Bureau of Economic Analysis (BEA) actually suggests the average expenditure per vehicle actually peaked in the late 1990s before creeping back down.
Meanwhile, we keep hearing reports about the average transaction price of passenger vehicles settling above $37,000 for 2019. Cross referenced against the BEA data, that’s about $5,000 dearer than in 1999 — once you’ve shifted everything to present-day dollars. Blame people’s inability to say “no” to options, crossover popularity, or anything else you want. It won’t change the problem, especially as the wealth gap continues to widen between the haves and have nots.
Automakers know that sales are stagnating and Ford CEO Jim Hackett thinks he’s come up with a solution — and it’s a familiar one. It’s decontenting time.
Audi Will Continue Pruning Its Product Portfolio
You might not have noticed but Audi has been quietly reducing the complexity of its lineup by eliminating certain content combinations, often in select markets. Here, the biggest change was the elimination of the manual gearbox for 2019. But Audi said it needed to be done due to there being an abysmally low take rate for besticked vehicles in North America.
Apparently, the automaker is just getting warmed up on tamping down the configurations. In an recent chat with Autocar, Audi CEO Bram Schot said there was plenty more work to be done. Having already reduced the number of model variants in certain regions by 27 percent, compared to last year’s options, the CEO said the manufacturer still wasn’t where it wanted to be.
2018 Volvo XC90: More Volvo Passengers, Same Volvo Price
It wasn’t the elegant S90 sedan or oddly seductive V90 wagon that heralded Volvo’s return to the top of its game — it was the earlier XC90 SUV, specifically the upright and self-assured second-generation model.
Now that it’s no longer the newest vehicle in the stable (thanks to a product surge fueled by Chinese dollars, it’s quickly becoming the oldest), the XC90 enters 2018 with an extra dose of value.
US New-Truck Leases Rise Thanks To Higher Residuals, Transactions, More Content
Forget about leasing Benzes and Lexuses: trucks are the new hotness, thanks to higher residuals and transaction prices, as well as more content.