UK Automotive Industry News from just-auto.com

Saturday 10th May 2008

A Europeanised Caddy
This week I have been driving around in a press fleet Cadillac BLS 1.9 CDTI Wagon. I wanted it to coincide with the interview I did with Jonathan Nash (below link). It's a pretty good piece of kit - the 1.9 litre diesel engine is turbocharged, there's plenty of load space, nice interior finish, subtle but definitely not bland styling (the Cadillac 'origami edges' figure). And the handling is sharp on what is a fairly sizeable car. No complaints and an easy car to live with. Comments in the office on the styling were pretty favourable, too - plenty thought it resembled a Saab (BLS is also made in Trollhattan). In short, it deserves a fair hearing amongst its mainly German peers here in Europe. But will it get one or more accurately, will there be enough customers who are attracted to the idea of a Cadillac badge on their status symbol? 'Do different' might make an appropriate brand tagline. One thing though - I certainly don't think Cadillac will be emphasing Teutonic-like peer values, as per Citroen C5. This is an American brand and there's a project ahead on communicating or maybe even reinterpreting Cadillac values for Europeans. But hang on, it's built in Sweden...but there again Saabs will be built in Germany with the next 9-5, BMWs are built in the US etc. Place of final assembly is perhaps less important if other associated brand values are very strong. It's a question of balance. Just realised re Jonathan Nash. We are a similar age, but he's ginger and has a good hair spread that has a lot less charcoal grey than me. Fair play: ginger upside. And, also, he sounds a wee bit like Chris Evans, too (listen to the embedded audio file on the below link...). Wait a minute, he actually looks like Chris Evans! Someone needs to ask him what he's doing in the Radio 2 drivetime slot.

Citroen C5 advertisment
Marketing and selling large premium cars isn't all that easy for the French outside of France. The German brands have something of a stranglehold - in Europe, especially. PSA is developing what it believes is a credible strategy - 'competitive premium' - essentially levering off the volume business on component sets to produce a low-cost premium offering in each segment and undercutting the established premium brands. I think it will be an uphill struggle in an area of the market where brand equity counts for a lot. Citroen is most definitely a value-driven brand and I think that counts against it in premium segments. But it will be interesting to see how the strategy unfolds in the market. The right price point can count for a lot, too, so maybe with good product there's a chance to build a reputation (and people who consider a Citroen brand premium car may have low initial expectations). And first off, perhaps you'd want to mix it a bit on the old brand image front, try and dispel some ingrained perceptions and maybe even suggest that you are already right up there with the established players... In the UK, Citroen is certainly having a go with the C5 and an advertising campaign on TV that has drawn some criticism for its 'Nazi imagery'. A group of MPs said this: 'This house notes with regret the stereotypes used by Citroen to market the new C5 as Unmistakably German, including imagery, symbolism and style reminiscent of the 1930s. '[We believe] this is counterproductive to the reputation of Citroen and urge it to withdraw the advertisement.' Personally, I think it is harmless and rather funny. Judge for yourself.

From Russia to Australia...
Russia's Ural Motorcycles is selling its two-wheeler product with funky sidecars to Australia. Is the 'George and Mildred sidecar' due a revival and maybe a reinvention? I dunno and it's a slightly disturbing thought in some ways. I came across Ural Motorcyles in Australia via something in the Sydney Morning Herald and I must say I find this all rather amazing - there are even sidecar adventure tours Down Under. I guess it's a relatively fuel-efficient transportation mode and Two Fat Ladies on their venerable Triumph with sidecar certainly rocked. One of those weirdly cool cult things due a mini revival? Fido's chariot?

Chrysler's creative incentive
I see the creative juices have been flowing over at Chrysler which is being hurt more than most by high gas prices. Buy a selected Chrysler model and Chrysler will subsidise the cost of the fuel going in the tank via a special credit card. It's an interesting one and I must say I like the inherent gambling element involved with holding the fuel price constant for the next three years. Will the actual pump price rise or fall and by how much? Who's judgement do you trust - Chrysler LLC's Chief Economist or your Auntie Pam's? Seriously, I wonder if other manufacturers are looking at this. Sure, you can say it's just another incentive (and it's capped of course), but it might be one that flies with consumers on the back of a feel-good factor which goes with filling the tank for 'just' USD2.99 for the next three years. A guy at Goldman Sachs has just forecast that the price of oil could conceivably rise to USD200 a barrel within six months. Yup, that 2.99 price might start to look like a real bargain. There again, the price of oil might just go the other way when peace breaks out in the Middle East, the dollar recovers on a stronger than expected 2009 US economic rebound and yet more oil is discovered off Brazil. As any gambler knows, there are no sure bets. And I wonder what the most fuel uneconomic Chrysler vehicle covered by this 'fuel protection' incentive is?

Electric power - how cheap will it be?
With the price of oil where it is, there's a general assumption going around that the issues for future electric plug-ins are confined chiefly to vehicle (lithium-ion battery) range and performance alongside some consideration of the CO2 used up in power generation. I've not heard much on what the issues may be for the electric power utilities. If that aspect is not completely ignored in the discussions that go on in the auto industry, it's often assumed that what comes out of the wall socket will be there and at the same kind of price as we pay today. It couldn't actually end up being more expensive than liquified fossil fuel could it? This article in the WSJ caught my eye.