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Ford, GM plan to end Sonic, Fiesta and Taurus in US, WSJ reports

Ford, GM plan to end Sonic, Fiesta and Taurus in US, WSJ reports


Both Ford and GM plan to stop making three cars for the U.S. market, as they continue to shift their focus toward popular and high-margin SUVs and trucks, The Wall Street Journal reported Wednesday, citing sources.


General Motors will stop making the small Chevrolet Sonic car, possibly by the end of the year, the Journal reported. Ford plans to stop selling the comparable subcompact Fiesta in the U.S. and discontinue the larger Taurus sedan, once the best-selling car in the U.S.

Chevrolet declined to comment.

“As we have said, by 2020 trucks and utilities — including their electrified versions — are going to be almost 90 percent of our volume,” a Ford spokesperson told CNBC. “Passenger cars,
including Fiesta and Taurus, remain an important part of our lineup.”

The move comes as automakers increasingly revise their offerings to suit the changing tastes of American buyers, who have over the last several years increasingly favored trucks, sport utility vehicles and crossovers instead of passenger cars.

Cases in point: the Jeep Wrangler, an SUV designed for off-road driving, just set an all-time monthly sales record, and the Lincoln Navigator, a luxury SUV costing up to $100,000, has been selling so fast Ford has had to ramp up production.

Lower gas prices and more fuel-efficient engines, including a growing array of electrified SUVs, have removed much of the need for small subcompact cars in the minds of buyers. Customers also often prefer the flexible storage space, higher ride height and the all-wheel-drive options more commonly available in SUVs.

And crossovers allow automakers to charge more money for a car that does not cost that much more to make. Several automakers have come out with compact or subcompact crossovers, such as the Buick Encore, the Honda HRV and the Ford EcoSport.

Meanwhile, even luxury car brands are having a hard time getting their sedans off the lot. Incentives on cars are extraordinarily high, and in some cases have been 30 to 50 percent of average transaction prices.

Read the full article at The Wall Street Journal.

Lamborghini's new $200,000 SUV is more popular than expected

Lamborghini’s new $200,000 SUV is more popular than expected


Lamborghini’s new $200,000 SUV is more popular than expected — with one New York dealer saying he expects to sell out of his orders as soon as they arrive.


Brian Miller, President of Manhattan Motorcars, which sells Lamborghini and other luxury brands, said he already has orders for 60 Urus SUVs even though the vehicle doesn’t start arriving until December. He said he plans to get about 100 vehicles in total.

“I’m sure they will all be sold,” he said in an interview at the New York Auto Show. “It’s very popular.”

Miller said his average selling price for the Urus, with options and customizations, is around $225,000.

What’s even more surprising than the demand for the world’s most expensive SUV, however, is who’s buying it. Lamborghini CEO Stefano Domenicali said 70% of Urus buyers have never owned a Lamborghini.

One reason for the first-time-buyer surge is that wealthy car enthusiasts who live in cities or countries with bad roads couldn’t drive Lamborghini’s low-slung sports cars without ruining them. The higher-sitting Urus has Lambo’s signature power, engine sound and bold angles but can easily glide over potholes, dirt and steep bumps.

Miller said the typical Urus buyer is also wealthier client than the traditional Lambo buyer.

“Lamborghini has always been a brand that many people stretch to get into,” he said. “We had a lot of younger people and it wasn’t the big money people we would have loved to see. I think the Urus is bringing a lot of those people.”

The Urus is the most radical change to Lamborghini in decades, eventually doubling the company’s annual production. Domenicali said the company will end 2018 with a total production of around 5,000 cars — more than 1,000 of which will be the Urus. By the end of 2019, the SUV will account for more than half of Lambo’s anticipated production of 8,000 cars.

A US-China trade war could threaten Tesla most among automakers

A US-China trade war could threaten Tesla most among automakers


“The tariff will add an extra premium on top of a vehicle price that was already ahead of the base U.S. price, related to transport costs and duties,” Johnson noted. For instance, he said, a base Model S 100D in the U.S. costs $94,000; the same vehicle in China today costs CNY 931,000 (or ~$148,000. The tariff comes into play on top of those prices.

“And while these steep import tariffs are part of the upper-end luxury market (and in some respects add to the prestige factor for luxury cars), for lower-luxury vehicles than the Model 3 a 50 percent premium would be significant,” the Barclays analyst noted.

Tesla was not immediately available for comment.

Tesla CEO Elon Musk has complained that the current trade rules between the U.S. and China are lopsided and unfair to American companies.

Tesla does have a pretty significant presence in China, and the country is important to Tesla’s balance sheet. The carmaker currently operates an 83,000-square-foot delivery hub in Beijing, with a lease set to expire in April 2020.

An SEC filing also shows China was the second-largest market for Tesla cars by revenue in 2017, after the U.S. And Tesla nearly doubled its revenues in China last year, pulling in $2 billion, compared with $6 billion in the United States and less than $1 billion in Norway. Musk has also talked about building production facilities in China.

For now, Teslas sold in China are potentially at a disadvantage, Johnson said.

Oddly, it’s German automakers that are the next most vulnerable to a U.S.-China trade war. Mercedes-Benz exports some cars to China from its Alabama plant, and BMW sends some cars from its Spartanburg, South Carolina, factory to China. But their exposure is still far lower than Tesla’s, Johnson said. Whereas about 12 to 13 percent of Tesla Model S and X vehicles go to China, only about 2 to 4 percent of Mercedes and BMW cars do.

BMW pilots a $3,700-a-month service that lets you drive any model you want

BMW pilots a $3,700-a-month service that lets you drive any model you want


German carmaker BMW is piloting a monthly subscription service, which will let drivers get access to a fleet of cars, whether they feel like driving a 5-series sedan to the office or using a faster M2 coupe for the weekend.


The $2,000 fee (plus a $575 joining cost) includes delivery by a concierge, use of the car, insurance, roadside assistance, maintenance and unlimited switches between models.

Currently available only in Nashville, Tennessee, drivers can order a car via an Access By BMW app. A second tier, for $3,700 a month gives access to the powerful M-series. Buying a top-of-the-range 2018 BMW M5 Sedan all-wheel-drive would cost more than $110,000, according to the BMW of Nashville website.

“Subscription-based services are of emerging interest for our customers, and we’re excited to be offering a mobility service to meet their individual and evolving needs,” said Ian Smith, CEO of BMW Group Financial Services USA, in an online statement.

Sexy SUV ads created demand now being used to attack fuel standards

Sexy SUV ads created demand now being used to attack fuel standards


It’s driving across rugged terrain in the great outdoors. It’s splashing through mud. Maybe it’s racing a wild animal. A deep voice announces that it has V8 engines and dual power steering.


It’s manly. It’s patriotic. It’s a commercial for a gas-guzzler.

Light trucks and SUVs are a cash cow for automakers and have the highest profit margins in their fleets. So it’s unsurprising that the auto industry spends billions of dollars on sexy advertising to push them on consumers.

But now the industry cites the predictable outcome of its own marketing as a reason to hamstring a critical environmental and health protection.

This week the Trump administration announced that it plans to weaken vehicle greenhouse gas emission standards for model years 2022-2025. The decision cited the auto industry’s complaint that the popularity of larger vehicles makes hitting fuel-efficiency targets more difficult.

Yet the industry’s advertising and profit motives play a considerable part in generating that popularity.

It’s a tactic that dates back to the 1970s when the Clean Air Act authorized the EPA to regulate vehicle tailpipe emissions. Automakers realized they could increase their profit margins by driving consumers to trucks, which then as now were subject to less stringent requirements than passenger cars.

Enter the 1974 Jeep Cherokee. The first vehicle officially marketed as an SUV was hyped with outdoorsy advertisements appealing to the sporty American family.

Other companies followed suit and have heavily advertised SUVs, pickup trucks and crossovers as cool, strong, adventurous-but-safe vehicles ever since.

According to data collected by Alphonso – a TV ad tracking firm – and analyzed by my organization, nine of the 10 vehicles most heavily advertised on nationwide television during the last quarter of 2017 were SUVs or pickup trucks.

Though automakers are investing in low- and zero-emission vehicles, it’s not translating to advertising and consumer awareness.

UC Davis researchers found that most new car buyers surveyed in California—the largest electric-vehicle market in the nation—can’t correctly name a plug-in electric vehicle presently for sale. Fewer respondents in 2017 were able to do so than in 2014, even though the number of makes and models of these vehicles nearly doubled during that time.

The current popularity of trucks and SUVs is also tied to low oil prices. But those won’t last forever. In fact, automakers’ oversupply of SUVs and light trucks is blamed for declining sales and profits among Detroit’s Big Three during the mid-2000s when oil prices rose.

And those aren’t the only reasons why pointing to “consumer preference” to weaken emissions standards is deceptive. A new poll released by the American Lung Association found that nearly 70 percent of voters want the EPA to leave the current standards in place.

The current standards, which the Obama administration negotiated with automakers in 2011, would halve carbon dioxide emissions from tailpipes by 2025. It would be the equivalent of a fleetwide average of 54.5 mpg if met through fuel-efficiency improvements alone.

Now that vehicles are the nation’s largest source of climate pollution, these standards are crucial. Shifting to cleaner vehicles would also protect people, particularly children and the elderly, from toxic tailpipe pollution. The EPA estimated that the standards would help avoid up to 2,000 premature deaths per year when fully in place.

In January 2017 the EPA published a midterm evaluation of the standards, concluding that they were readily achievable for automakers, would achieve huge benefits for the public and save consumers money at the pump and should not be rolled back. Since the rules were established the technology has rapidly improved and compliance costs are much lower than estimated.

Meanwhile, the electric car industry in China is exploding. Chinese companies have nearly a 90-percent market share on electric vehicles. Taking America out of the running in the global race to clean up our cars can only lead to the next wave of bankruptcies and bailouts.

Trump is helping our most polluting automakers fuel the climate crisis and poison our air, all while shooting our economy in the foot. And he’s letting consumers shoulder the blame.

Commentary by Vera Pardee, a senior counsel at the Center for Biological Diversity’s Climate Law Institute.

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Ford recalls about 350,000 F-150s and Expeditions for faulty transmission gears

Ford recalls about 350,000 F-150s and Expeditions for faulty transmission gears


Ford is recalling 350,000 vehicles for a transmission issue that could result in the car moving after the driver has placed it in park and removed the keys.


Ford said it is aware of one reported accident and injury related to the issue.

The recall applies to some 2018 Ford F-150 trucks and 2018 Expedition SUVs with a 10-speed automatic transmission, and some 2018 Ford F-650 and F-750 vehicles with 6-speed automatic transmissions.

The recall involves about 347,425 vehicles in North America, including 292,909 in the United States, 51,742 in Canada, and 2,774 in Mexico. Ford’s reference number for the recall is 18S10.

There is a clip that locks the gear shift cable to the transmission in vehicles. In some of the affected vehicles, this clip is not firmly in place, which could result in the car shifting into a different gear from the one the driver has chosen.

In this situation, there may be no warning light or chime to warn the driver the vehicle is not in park upon exiting the vehicle. This could mean the truck rolls away after the driver has left, if the emergency brake is not engaged.

Dealers will inspect vehicles and make necessary repairs for free, Ford said.

Ford issued a second recall for other another similar potential transmission problem, affecting 161 2017 and 2018 F-150, Expedition, Mustang, and Lincoln Navigator vehicles. A missing transmission roll pin could cause the vehicles to fail to shift to park when the driver selects it. The reference number for that recall is 18S09.

Tired of being monochromatic Two-tone cars stage a comeback

Tired of being monochromatic? Two-tone cars stage a comeback


Maybe it’s a sign of the times and a strong economy. Or maybe it’s a sign that people are just tired of plain, monochromatic cars.

Whatever the reason, automakers are finally putting an added dash of color in the looks of some of their latest models, giving them fancy two-tone paint jobs.

Toyota introduced the next version of the RAV4, a compact that was the nation’s most popular SUV last year, at the New York Auto Show last week with a contrasting roof color — white or black — depending on the version. Hyundai’s Genesis followed up with a stunning concept car that included a startling choice of metallic gray on the body with a large swatch of glossy black down the hood.

They join other two-tones already on the market from Land Rover, Volvo and the automaker best known for leading the modern version of the trend more than a decade ago, Mini.

In an age when many people may drive the same model of vehicle, custom-looking paint schemes allow for more personalization.

“Not everyone wants to drive the same car as their neighbor,” said Stephanie Brinley, analyst for IHS Markit. “People still want something that feels special.”

Read more from USA Today:
GM to kill Chevrolet Sonic, Ford to discontinue Fiesta, Taurus, report says
New York Auto Show: How Nissan Altima, Toyota Camry, Honda Accord will survive the car plague
Top 10 must-see cars from the New York Auto Show

The trend is made feasible by automotive factories where robotic painting makes it easier to color cars in ways that might not have been as possible in the past, said Rebecca Lindland, an analyst for Kelley Blue Book. Plus the results are eye-catching.

“It emphasizes customization,” Lindland said after viewing Genesis’ gray-and-black Essentia sports-car concept at the auto show, which is open to the public through Sunday. “It has a custom look but not a custom price,” she said of two-tone cars.

Two-tone paint jobs are associated with the 1950s, when pastels were popular and the boomerang-shaped designs of the era and chrome striping were on full display on the sides of cars. But the look disappeared in the 1960s and 1970s — along with white-wall tires — as cars got lower and sleeker.

These days, the two-tone look is generally restricted to having a roof that’s a different color than a car’s body. BMW got the party rolling when it brought its British icon Mini to the U.S., giving buyers a choice of roof colors including wild designs such as a Union Jack decal.

In the case of RAV4, the decision to go with white or black roofs on the outdoorsy Adventure and hybrid versions reflect the compact SUV’s youthful buyer profile. Buyers were asking for more color, said Jack Hollis, head of the Toyota division introducing the car.

“It’s adding extra personality,” he said. “We see it as a fun way to add more style.”

In the case of Essentia, Genesis design director Luc Donckerwolke acknowledges that he didn’t choose a common paint scheme for a concept car by going two-tone. But, he points out, “we don’t dress in a monochromatic way” so why should cars be any different?

The steadily disappearing American car

The steadily disappearing American car


When average U.S. gas prices reached their all-time high of $4.10 a gallon during the recession in 2008, U.S. automakers sold far fewer trucks and SUVs than they do today, and fewer than they had several years before. In 2008, cars were 51 percent of sales, and trucks, SUVs and crossovers were 49 percent.

But high gas prices spurred investments in U.S. oil extraction. Production doubled in about a decade, from 5 million barrels a day to about 10 million, said Patrick DeHaan, petroleum analyst at GasBuddy, a technology company that gives nationwide gas prices in real time.

“There has been kind of been a monumental paradigm shift in the oil sector,” DeHaan said. “The U.S. is producing the most oil it has since the 1970s. All this has led to 3+ years of relatively affordable gasoline.”

That has led consumers to reconsider the importance of fuel efficiency when buying cars.

That showed in the car market. By 2017, that nearly even split between car and truck sales became lopsided, with 35 percent of sales going to cars and 65 percent to trucks and SUVs.

Oil prices are likely to be more stable going forward, and gas prices should hover between $2.50 and $3.00 through 2019, DeHaan said. American production will likely act as a check on OPEC — if the cartel raises prices too high it will incentivize other producers.

There are still risks on the table, and there is still potential for volatility in the market.

“OPEC could wake up tomorrow and decide they aren’t happy with $65 a barrel,” DeHaan said. Rising tensions with Russia are also a risk. Oil-producing countries have used the commodity as a political weapon in the past, he said.

But even if gas prices rise, U.S. consumers may never turn back to cars.

“Some buyers would move to cars, assuming there are still small cars available at that time, but I think the majority of the movement would still take place within the SUV segment,” he said.

Trucks and SUVs still generally lag cars in fuel efficiency, but they are improving. And they have made big leaps in design and quality that make them more competitive with cars.

Powertrains are growing more efficient. Ford, for example, has talked of selling hybrid versions of vehicles across its lineup, including trucks such as the F-150.

The higher ground clearance on SUVs and trucks leave space beneath to store a battery, Schuster said.

Even combustion engines are far more efficient than they used to be. For example, GM built an engine that can shut off a few of its cylinders at times to improve efficiency. It can be found on pickups such as the Chevrolet Silverado and GMC Sierra, or on crossovers such as the upcoming Cadillac XT4.

Many crossovers and SUVs are also built with unibody frames, which tend to be lighter, Brauer said. In addition to improving fuel economy, the lighter frames make the vehicles drive better — they don’t feel bumps in the road as much and can corner better than heavier body-on-frame vehicles. They are easier to insulate, making them quieter and reducing the wind noise that comes with driving a taller vehicle, especially at high speeds.

Larger trucks, such as the Ford F-150, use aluminum instead of steel to reduce weight, cutting fuel use. GMC is the first to outfit its trucks with a carbon fiber bed, another lightweight material.

Customers see a vehicle that can drive like a car and offers the benefits of an SUV — better visibility, more space, and flexibility in seating and storage.

“We basically removed the downsides of owning SUVs over the last 10 years with engineering and design,” Brauer said.

The deal is also good for manufacturers. Average transaction prices for a subcompact SUV such as the Ford EcoSport are $4,500 higher than the automaker would get from a subcompact car like the Fiesta, and $2,500 more than the company would get from the slightly larger Focus.

The Wall Street Journal reported Wednesday that Ford will discontinue its once best-selling sedan, the Taurus, and end U.S. production of the subcompact Fiesta. The report also said Chevrolet will altogether stop making the Sonic, another subcompact car.

There could be some pushback if regulators pass tough emissions rules. But at some point, technology may narrow remaining gaps in efficiency.

And consumers could still decide they like cars after all, swinging the pendulum in the other direction. But don’t count on it, Brauer said.

“Those would be tiny little blips in the trend we are seeing and will continue to see,” he said.

CORRECTION: This story has been updated to reflect the number of barrels the United States produces in a day. The previous version misstated the number.

The 2018 BMW X3 xDrive30i review

The 2018 BMW X3 xDrive30i review


If you’re optioning an X3 xDrive30i, start with the standard “xLine design theme.”

The executive tier adds the convenience, premium, and executive packages in one big bundle. That means gesture control, a heads-up display, surround-view cameras, a navigation system, a panoramic moonroof and about a dozen other features that transform it from a basic Bavarian to a tech-forward premium SUV.

You’ll be forking over $9,650 more than a standard X3, but the luxurious and well-implemented technology is the core competency of this BMW, so it’s worth paying up for. Add $550 if you want a color other than black or white.

$300 buys you Apple CarPlay and $2600 buys you the Driver Assistance Plus package, adding semi-autonomous capability and a slew of life-saving active safety features to your new BMW. For $875, the awesome Harman Kardon audio system is a no-brainer.

Add in destination, and you’re at $57,620 for the whole package.