#economy

U.S. light vehicle sales sunk slightly in 2017 after years of increases, and this year’s not looking any different. In Russia, however, it’s the opposite situation. After making like the Germans at Stalingrad for the past three years, the Russian car market is now advancing like a T-34 tank — and it has the country’s most famous car brand to thank for it.

Leading the pack is none other than Lada, a company known for cranking out archaic, seemingly indestructible Iron Curtain cars for decades with only minimal changes. That was then, though, and this is now. Spurred by a rebounding economy, sales of new Lada models helped Renault-owned parent company Avtovaz drastically cut its losses in 2017.

Lada’s top brass can give credit to a very Western product strategy.

Despite aggressive regulatory efforts to counter pollution, California emissions from on-road transportation rose by roughly 4.4 million metric tons of carbon dioxide in 2015 vs one year earlier, according to the San Francisco-based non-profit Next 10. The state also had the dubious honor of housing six of the country’s 10 most polluted cities, based on data from the American Lung Association’s annual “State of the Air” report released last April.

While topography plays a major role (cities located in valleys and basins have a tendency to trap air pollutants), much of the problem has to do with Californians driving more. Let’s face it, gas is cheap and public transit options are typically the less-enjoyable option in all but the most densely packed cities. In fact, the Los Angeles County Metropolitan Transportation has seen declining ridership over the last two years — even though the city has a major issue with traffic.

As the Trump administration applies pressure to encourage companies to manufacture goods within U.S. borders and bolster American employment (or potentially face towering tariffs), the president has more recently come out against foreign automakers directly. In late May, Trump responded to criticism from German Chancellor Angela Merkel by accusing her country of having a trade surplus with the United States — claiming its automakers send vehicles to North America while providing little else. Trump has levelled similar criticism at China.

However, there’s a problem with his assertion. Foreign companies may not always contribute the majority of their wealth towards improving the U.S. economy, but they do invest heavily into the country. In fact, a recent analysis of federal jobs data shows two-thirds of the 656,000 manufacturing jobs created between 2010 and 2014 can be attributed directly to foreign investment.

Accurate employment figures for the following years aren’t yet available. But, with an additional $700 billion in capital coming in from non-domestic sources, total foreign investment reached $3.7 trillion by the end of 2016 — a new record.

Last week, I asked about vehicles which managed to turn up the Suck Dial between generations. The overwhelming response to this question compared to the opposite question asked a week earlier (about generational improvements) showed me how you all love being negative and trashing cars.

Thus, about six weeks ago, the genesis for today’s question was put into print. At that time I asked about your favorite automotive success story. But today we’re going to be much, much more negative.

Tell me your favorite automotive flop.

General Motors’ Oshawa, Ontario assembly plant is bleeding vehicles and in danger of closing, but the city and its workers aren’t going down without a fight.

GM employees, their union, and local government representatives want a new mandate to produce vehicles beyond 2017, invoking images of Flint, Michigan in their battle with the automaker. The recent announcement of 700 new provincewide engineering jobs doesn’t cut it, they say.

To them, GM’s silence reeks of an exit strategy.

“Would it kill you to buy American?” mutters Walt Kowalski after watching his son drive off in a Toyota Land Cruiser at the beginning of the film Gran Torino.

The common refrain from past and present members of the U.S. auto industry has everything to do with the sector’s impact on the domestic economy. If you’re really concerned about your car’s “purity,” however, there’s an annual report that checks just how much domestic content went into every new vehicle sold on American soil.

This year, three controversial General Motors vehicles return to take the patriotic crown. But they’re still not fully American.

The diesel emissions scandal can’t be blamed for all of Volkswagen’s sales woes.

Today, the automaker announced first-quarter profits fell 86 percent compared to the same time last year, not surprising given its sidelined diesel models, the hit to its reputation, and a hastily cobbled together $18.2 billion scandal fund.

Worldwide sales of Volkswagen passenger cars fell 1.3 percent (year-over-year) this quarter, but the scandal doesn’t tell the whole story. That number would have been in positive territory if select countries weren’t grab-your-money-and-get-out economic disasters.

Nissan’s product pipeline has all the flow of a crusted-over faucet, and that’s not good for business.

That, automation is insidiously infiltrating cars all around you, Mercedes-Benz goes all in on AMG, Jaguar teases China with something special, and foreigners flee the Russian automotive landscape … after the break!

A wave of older vehicles is poised to flood Toyota dealer lots, but the automaker is confident it has just the plan to deal with it — pre-owned leasing.

Toyota is certain that adding a leasing option to its certified pre-owned inventory would boost CPO sales and clear lots in the face of a growing compliment of three-year-old product, Automotive News reports.

The plan has already been quietly rolled out in the U.S. Northeast, but a national strategy should be in place by the end of April, dependent on training in each dealer region. The option would allow a reduced commitment for buyers who don’t want to finance the full cost of a pre-owned vehicle.

Good times have clearly arrived, because Americans are flinging money at cars like it’s going out of style.

Leasing has never been more popular for American car buyers, reports the Detroit Free Press, and the size of their auto loans have also reached record territory.

One coupe flies, two coupes die.

By the time that Akio Toyoda was standing on that Detroit stage crowing about the triumph of the LC500, the nails were already being hammered into Scion’s coffin. The Scion tC, perhaps the best combination of practicality, style, and durability available for under twenty-five grand in the United States, will be taken out back and unceremoniously shot. The FR-S … your guess is as good as mine, but I’d be surprised if Toyota brought it over as the Celica, no matter how personally gratified I would be by such a move.

The story of Toyota’s American sub-marques could not be more different. Lexus has gone from strength to strength, effortlessly assuming a position as the thinking man’s luxury car with the LS460 while also flooding the market with Camry-platform high-profit product. Scion, on the other hand, has struggled from its first day with customer perception, dealer-satisfaction issues, and schizophrenic product planning.

Yet it’s easy to show that Lexus has been just as poorly managed as Scion; take a look at the Lexus lineup over the past 27 years and tell me that you can’t spot quite a few duffers and misfires. So why is the Official Toyota Brand of McMansion Owners soaring while the Official Toyota Brand of Dubstep Aficionados crashes? The answer, naturally, is: Barack Obama.

Break out the champagne and 7-liter engines. Have one on us, alright?

The Wall Street Journal and Reuters are reporting that despite a mild increase in crude, oil is hovering around $40 a barrel and it’s expected to further dip in coming months to a six-year low on a global glut of oil.

The national average for a gallon of gas could drop to as low as $2, Green Car Reports says, which would be the cheapest its been since January, and could approach historical lows from 2008.

Automakers PSA (Peugeot and Citröen) and Fiat Chrysler Automobiles are most at risk if Greece’s economy fails and the country backs out of the Euro, according to a report by Automotive News.

Analysts say the two automakers have the largest share of southern European markets — including Italy, Spain and Portugal — where the economic impact of a Greek failure could hit the hardest.

Although the automakers have a large share of those markets, its a relatively small portion of their overall sales, the report states.

Speaking at an unrelated Fiat 500 reveal last week, Fiat-Chrysler chief Sergio Marchionne said Ferrari is worth about $11 billion and he expects the prancing horse’s IPO to garner about $1.1 billion went it goes up for sale in October.

“There are clear expectations from ourselves as Ferrari brand is unique,” Marchionne said, according to Bloomberg News. “There is also a scarcity value as we are just selling a 10 percent stake.”

Marchionne’s estimate is roughly double what brokers said the Maranello-based manufacturer could be worth almost a year ago.

Done Duratec’d Out? (photo courtesy: Supaman)

TTAC Commentator Supaman writes:

Hi Sajeev,

Haven’t visited TTAC in a while but I’m back! My Mazda 6 has now crossed the 101k mileage marker and all your nuggets of wisdom have helped keep this classic functional and beautiful. However, there’s another problem rearing its head that has plagued even the Mazda forums I’ve visited for a resolution.

It involves the car’s driveability at anything below 3000 rpm. Doesn’t matter whether the engine is just warming up or at operational temperature, the car will hesitate (sometimes violently) in a stuttering/bucking fashion when accelerating from a stop through the gears until I crest that magic 3000 mark on the tach. Out on the highway, passing in top gear is almost impossible because of the engine’s hesitation if revs fall below that number, requiring a downshift to 4th to keep them up. At first I thought my manual skills were to question but then I never started experiencing this issue until around the 87,000 mile mark. It has since gotten worse. Sometimes the bucking is enough to trigger the CEL but then it always goes away after a while.

Browsing the forums I’ve tried everything from cleaning the MAF sensor, fuel injector cleaner, throttle body cleaning as well as replacing the O2 sensor. I’ve narrowed it down to either spark plugs (some forum members replaced theirs but the problem came back hours later), the coils or possibly a vacuum leak. One post I read indicated a potential cylinder misfire. Even Mazda dealers were confounded.