Verve shows Ford’s small-car vision

Verve shows Ford’s small-car vision

August 23, 2007

By SARAH A. WEBSTER

FREE PRESS BUSINESS WRITER

Ford Motor Co. gave its first hints of its future small-car design vision in the new Ford Verve Concept, photos of which were revealed today.

The bullet-shape concept is bold, sporty and in a design style that Ford calls “kinetic,” for the visual effect that makes the vehicle look like it’s in motion, even when standing still.

Martin Smith, executive director of design for Ford of Europe, which is leading Ford’s small-car development for major world markets, called the style “bold, even radical.”

The Verve, which will be revealed at the 2007 Frankfurt Motor Show, is the first of three subcompact concept vehicles that will debut in key regions: Europe, Asia and North America.

North America, in particular, has been longing for a subcompact, or so-called “B”-sized, car from Ford since gas prices soared to $3 a gallon in recent years. Ford left the ultra-efficient subcompact car segment in 1997, the last model year for the Ford Aspire, and hasn’t said when it’s coming to market with a replacement since then.

Subcompact cars are those smaller than compact cars, such as the Ford Focus and Honda Civic, and the category is still very small, accounting for a sliver of the 16 or so million cars and trucks sold in the United States each year.

But it’s growing fast. The market for those affordable, fuel-efficient vehicles — such as the Honda Fit, Toyota Yaris, Kia Spectra and Chevrolet Aveo — has been booming in the increasingly gas- and green-conscious market.

Contact SARAH A. WEBSTER at 313-222-5394 or swebster@freepress.com.

So that’s Ford Europe’s new concept car that will give hints of the upcoming Fiesta. Based on the same platform as the Mazda2, the Ford Verve concept again shows off Ford Europe’s “Kinetic Design” that has graced Ford Europe models such as the Mondeo, S-Max, and an upcoming crossover. Although buyers outside of North America will get a new Fiesta that will more or less resemble what is shown on these images, the Americans will get a dumbed-down version of this subcompact that will have the bold styling and three-bar grille currently seen on the Ford Taurus and Ford Fusion.

All is great, but it would of been better to just import the Ford Europe cars with “Kinetic Design” and badge them as Mercuries while recycling some of the global platform used on other Fords on the American models. Ford Motor Company still doesn’t have a clue about what to make of Mercury other than positioning it as a car for female young professionals, but Alan Mulally was able to get the powers-that-be at Ford to have the next generation Focus and Fusion share its underpinnings with global platforms. However, these models will of course be dumbed-down and restyled with the three-bar grille since Americans apparently can’t handle “kinetic styling” and superb road performance.

According to autoblog:

Ford execs have said that these cars will wear different styling and be tuned differently, but we’ve heard from inside the Blue Oval that a conflict between U.S. and Euro designers is growing, with the former group upset that its delicate balance of three-bar grilles will be upset by the Fiesta, and possibly other models, arriving with FoE’s “Kinetic Design” theme.

And people wonder why Ford was bleeding cash all these years until recently…

The Roewe W2 (450) at the Auto Show Shanghai

About 3 years ago, the last volume manufacturer, MG ROVER, went into administration due to declining revenue, depleted cash reserves and rampant mismanagement from the “Phoenix Five”. From the ashes of MG Rover, rose two Chinese companies who have acquired their assets and intellectual property: SAIC and Nanjing Auto. The former company was one of the initial manufacturers that were interested in partnering with MG Rover before learning of their financial troubles, but failed to acquire the company when it was in administration while the latter was an obscure auto manufacturer that somehow won the bidding to acquire all of MG Rover’s assets.

Both companies were able to acquire the intellectual property for the Rover 75, which was the key property that SAIC wanted, while MG also got the IP for the MG TF in the process as well.

Using the Rover 75 platform, SAIC was able to update the car and introduce it to the Chinese market as the Roewe 750, which included a longer wheelbase and a facelifted front and rear end. Unfortunately, SAIC was not able to get the rights to the Rover brand since Ford used its option to buy it from BMW to prevent any confusion from their Land Rover brand. As a result, SAIC management made a snap decision to call their brand Roewe (pronounced Row-Wii) and a hastily drawn logo in response to Ford’s purchase. Personally, I would have preferred SAIC simply reused their old “Shanghai” brand for the new car or started pronouncing their new brand, Roewe, as “rowe” like Lowe instead of “Row-Wii”.

In any case, SAIC was able to work around this setback by first rehiring all the MG Rover engineers that had been working new Rover models, outsourcing some of their engineering work to Ricardo, and building brand recognition for their updated Roewe 750.

Here is the Hollywood-style ROVER 75 (Chinese call it ROEWE 750) commercial in Chinese TV. The sales has started nation-wide on January 31 year of 2007 and commercial is playing on national CCTV and other important media.

The national sales order for the first two week rocket to 3211 even when the nation-wide sales network is not built up completely. Now the order volume is stable at the number of 300 for one day.

So far the Roewe 750 has gotten good feedback from the local market and this has encouraged SAIC to produce more models for their new Roewe brand. One of these models is speculated to the the Roewe 450, a replacement for the Rover 45, and a continuation of the canceled MG Rover RDX60 model. The result of this project was a new car that would be based on the old Rover 75 platform with an updated design, that premiered as the Roewe W2 concept at the Shanghai Auto Show.

http://www.austin-rover.co.uk/

Although there’s little linking this car stylistically with the outgoing Rovers and MGs, the similarity to the ill-fated RDX60 is quite startling, indicating that the project was continued by Ricardo2010, almost seamlessly from the closure of MG Rover - indicating the earnestness of the company’s statement back in 2005, that the RDX60 was most definitely theirs…

As with the RDX60, the Roewe 450 is based upon the architecture of the Rover 75 - and because of that, it’s heading for production at an unprecedented rate. Unlike the original MG Rover, car, Roewe’s 450 will only be offered in saloon form, and will feature a pretty new interior that echoes the changing face of the original project, and how the MG and Rover marques were going to be modernised.

The 450 or W2 was spotted in various auto magazines undergoing extreme weather and performance testing in parts of the world with some speculating what it would actually look like. Fortunately, SAIC made a wise decision in rehiring most of the MG Rover design team and engineering in making this Chinese market car with British flavour.

SAIC’s new design was actually one of the more impressive concepts at the Shanghai Auto Show next to the Chery Shooting Sport concept. The Roewe 450 appears to be aimed squarely at buyers that would be interested in a Ford Focus, Volkswagen Jetta, or even a Toyota Corolla. Although it is very likely that the front and rear ends will be simplified when the 450 is pushed to production, the W2 concept does give us a good idea of what to expect from SAIC’s Roewe brand in the coming years.

On the other hand, the best that Nanjing Auto could produce so far are Chinese assembled MG Rover models with new names. The MG ZT is now the MG7, MG ZS is the MG5, while the MG TF remains the same. Very little has been done to update the models other than new names and money spent building a new assembly plant with tooling brought over from the old Longbridge plant. In addition, Nanjing Auto decided that it was somehow a great idea to throw away all the MG history by rebranding MG as “Modern Gentleman” and doing little to show it is a new player other than emphasising the brand’s British roots. It also does not help that years of hype over newly designed models and restored jobs did not materialise as of 2007, despite what the MG-NAC fanboys say on forums.

The Chinese market looks to be an interesting venture with competitors such as China Brilliance, Chery, and SAIC. So far China Brilliance has used their joint-venture with BMW to produce the “Zhonghua” brand cars that are currently losing money in the home market and damaging the reputation of Chinese cars in Europe. Chery is becoming a rising star with their bestselling QQ model, which is a copy of the Daewoo Matiz, and with potential for growth thanks to partnerships with Fiat and Chrysler. Last, SAIC has been a major player from joint-ventures with GM and Volkswagen and it has the resources to grow their own brands such as “Shanghai” and “Roewe”. Only time will tell which Chinese company will come out on top in their home market.

At the 2007 NY Auto Show

Got up this morning to go to the NY Auto Show just as I did the year before except I arrived at the city in the early afternoon. As a result, the lines were much longer and security was tighter. Fortunately, I didn’t have to wait that long in the computerised ticket lines because some Chinese guy offered me an extra E-Ticket in return for reimbursement. I paid the man at cost and then went along photographing production and concept cars that interested me and continued exploring the Javits Center after I met up with Jehangir.

Here are some cars that were of interest in today’s auto show:

The new Ferrari 599GTB Fiorano was one of the highlights at the Ferrari booth in addition to a 430 Spyder. The only people allowed to view the interiors and talk to Ferrari representatives were weathly clients who had made a reservation for such viewings. In addition, this booth also had a very attractive model, which made the booth even more crowded as everyone tried to take pictures of the cars, the girl or both at different times.

I reckon that she was one of the hotter models that were on the show other than that girl in the Lamborghini booth. While it’s true that there were many attractive presenters and representatives at the Toyota/Lexus exhibits, it was not a great idea to take pictures of them since that’s not their job and it would bring trouble with security as I have seen with another guy who tried to take pictures of an exhibit worker.

At the beginning of the Auto Show, there is always a Scion booth next to the exotic cars booth which provides people opportunities to learn about the new models and get free stuff without actually going into the show itself. In the Scion booth, I was able to get a free CD of their latest music and a free magazine/brochure on their new models.

The new Scion xB is boxier and sleeker than the original model. Starting at around $15K it’s also not a bad deal since it now comes with a more powerful inline-4 engine, larger trunk space, and has iPod interconnectivity. It’s also good to know that this new model carries over many ideas from the 2005 Scion t2b concept model.

At the Toyota booth, one notable concept car they had was the FT-HS, which was designed to demonstrate the possibility of a performance hybrid sports car. The reason why the FT-HS was such a hit when it premiered at the Detroit Auto Show was because fanboys were speculating that this was a pre-production Toyota Supra, which is not the case. The spiritual Supra is actually the Lexus LF-A which has partly the looks of the old Supra with innovations that fit the Lexus brand.

The LF-A, otherwise considered by me as the “Lexus Supra”. The latest incarnation of this concept car, has shown radical changes from the last time it premiered in the 2004 Detroit Auto Show. Some noticeable changes are in the front end, the side profile, and the rear end, while it is rumoured that the LF-A will receive a V-12 engine in addition to the V-8 to connect it to Toyota’s Formula 1 racing heritage.

The other car that interested me was the Lexus IS-F, the performance version of the Lexus IS, which was fitted in with a V8 Engine. The car’s bonnet doesn’t exactly look right since the IS was originally meant to take only V6 engines and it ends up giving a huge, stretched bulge in the front end.

At the same time, I also visited the Nissan and Infiniti booths. There was not really much that impressed me there since the Altima Coupe essentially resembles the outgoing Infiniti G35, the new Infiniti G37 doesn’t look too different from the old model, while the Infiniti EX concept looks horrible in person. Although, I am still interested in getting an Infiniti M in the future, the car is really not worth photographing in an event such as this. I didn’t bother with looking at the BMW and Mercedes-Benz exhibits since they had little to offer as well.

At the Chevrolet booth, I noticed they had the Volt available for viewing. As few know, GM was actually the ones who pioneered the electric car with the EV-1 in California but killed it when state and federal regulations were changed so that GM doesn’t have to produce such cars to meet emission standards. GM was actually the one that ultimately killed their grand experiment as discussed in the film, “Who Killed the Electric Car?”, which makes it quite ironic they created the Volt in the first place. Only time will tell if GM will actually bring this car to production or use it to just divert any negative publicity that came from that film.

Chevy also got their Korean division, Daewoo to design three concept city cars to gauge American interest in them. All three of these models are based on the platform used by the Daewoo Matiz/Chevrolet Spark/Chery QQ.

I like the third one better, while some Americans who were viewing the concepts had other thoughts. One girl called those concepts “Gay” while others were simply repulsed by the idea of having the Chevrolet brand being placed on such small cars.

In addition to viewing the Chevy exhibits, which were mostly filled with bland models or pickup trucks, I also managed to see the Americanised Opels and Holdens.

The “Saturn” Astra is essentially an Opel Astra that has been swapped in with a Saturn nameplate and dumbed-down for American consumption. It is meant to be a quick fix to the problems associated with replacing the hideous Saturn Ion and I applaud Bob Lutz for pushing this idea forward.

On the other hand, the Pontiac G8 is essentially dumbed-down Holden Commodore with a Pontiac front end. Some of my Australian colleagues at work were horrified to learn that their Commodore has been dumbed-down and associated with a brand like Pontiac which is known largely for cars hawked by Oprah such as the G6, a rebadged Chevy Colbalt called the G5, and a quirky roadster called the Solstice. I actually dedicated a post discussing these changes with the Commodore so I will just leave it at that.

I went to the Honda exhibit to learn more about the Accord Coupe and came out unimpressed with the concept. Compared with the sleeker and more stylish Civic, the Accord really looks like a bland piece of metal that might have been styled by a monkey.

At the Ford exhibit, besides laughing at the revived “Taurus”, Ford finally brought out the production version of the Fairlane called the Ford Flex. It’s interesting to note that the Ford Fairlane was essentially a Range Rover with a Ford grille placed on a Ford 500 platform. Unfortunately for Ford, they got too carried away with turning the Fairlane into their minivan replacement to the point where they stretched the wheelbase to the point where the Flex now resembled a wider and stretched Mini. This is really counterproductive for the Taurus X since it may cannibalise in that car’s sales.

However, despite all the exotic cars and quirky concepts, the car that most impressed me at the New York Auto Show was a Korean car. Let me repeat that: a Korean car was the most impressive car at the NY Auto Show. I find this strange to say because Korean cars such as Hyundai, Kia and Daewoo were all known for their shitty styling and substandard quality at one point. However, Hyundai has proven that they are an able contender in the near-luxury and luxury market with their Genesis concept.

If one looks closely, they can see that this car is neither a Honda or a Toyota just by looking closely at the nameplate. I know it is hard to believe, but the Koreans have done it with the Hyundai Genesis. We can see that the front end is heavily influenced by that of the current Toyota Camry while the rims look like they were from an Infiniti.

With a front end influenced by a Toyota Camry, a side profile lifted from a BMW 5-Series, and a rear end lifted from an Infiniti M, it seems Hyundai has a rough idea on how to create the look of a luxury car. Supposedly their luxury model will start at $28K and can go upwards of $30K with Hyundai having their sights set on BMW and Lexus in the long-term. It would not be surprising to see Hyundai gradually turn their brand into Korean luxury brand while leaving Kia as the Korean brand for their bland and standard offerings.

The rest of the pictures I took at the Auto Show are here

“Toyota: Developing Strategies for Growth”

“Toyota: Developing Strategies for Growth”

In order to have a successful strategy for growth, businesses must first find, evaluate and select a strategy to capture a potential market. Since it entered to American car market in 1967, Toyota has developed a diverse business portfolio with its existing line of cars as well as brands such as Lexus and Scion. It became a successful car manufacturer by having an effective marketing process that allowed it to attract customers and expand its product range to other market segments.

When Toyota and other Japanese carmakers entered the American market, they were not considered a threat to the American auto industry because it was believed their cars had no appeal to American consumers. However, in the 1970s, due to problems such as the 1973 Oil Embargo, environmental regulations, and quality control issues with American cars (Ford Pinto), a good number of American car owners began searching for alternatives to their gas guzzling, poorly made American cars. In response to these changes, Toyota and other Japanese carmakers aggressively marketed their cars to Americans as being fuel-efficient, environmentally friendly, and having better build quality than American cars. In addition, Toyota marketed their cars as being hip and fun with memorable slogans like, “you asked for it, you got it, Toyota,” and with commercials involving young Toyota drivers jumping in the air. As a result, the Japanese’s marketing campaign along with continuing problems from the Big Three auto manufacturers, allowed import cars to make up about 20 percent of the US car market by 1980.

After successfully gaining a sizable market share in the US, Toyota decided to create the Lexus brand in 1989 to target the luxury-car market segment, which was dominated by Mercedes-Benz and BMW. They decided to create a new brand because of their reputation at the time for being a company that only offered fun and fuel-efficient compact cars and because the introduction of luxury models into their existing lineup would dilute the Toyota brand. Therefore, Toyota marketing strategy was to market Lexus as a separate company with almost no references to Toyota, a heavy emphasis towards quality customer service and it had a separate dealership network from Toyota. This marketing strategy has allowed Lexus to become one of the best selling luxury cars in the US by 2000 and it encouraged Nissan to sell luxury cars with the Infiniti brand.

Despite the successes of both Toyota and Lexus, it began to face a new problem: age. Presently, Toyota’s new customer base is 47 years old, which is higher than the industry average of 45 and placed Toyota’s average customer base with the likes of Buick, Mercury, and Lincoln. In response to their aging customer base, Toyota formed a study group called Project Genesis to develop a marketing campaign to attract younger buyers to Toyota. The result of Project Genesis was the introduction of sportier and “youthful” models to the US: the Celica, MR2 Spyder and Echo in 2000. Unfortunately, Project Genesis was a failure because it had a dull marketing campaign that failed to create a common theme for the different cars, sales for each of the models did not reach Toyota’s expectations and the entire study group failed to realize that Toyota had developed a reputation for making generic cars. As a result, Toyota Motor Sales USA has decided to phase out the Celica and MR2 Spyder by 2005.

Although Project Genesis proved to be a failure, Toyota made another attempt to capture the youth market by creating a third brand called Scion in 2003. Unlike Lexus, which was created to sell luxury cars, Scion’s purpose is eventually attract American youth into becoming Toyota customers by first introducing them to relatively cheaper and radically designed cars. Scion currently has three cars in its lineup: the xA and xB, rebadged Japanese-only cars whose design does not fit the Toyota and Lexus brand philosophy, and the tC, a newly designed car based on the preferences of American youths. In addition, Toyota focuses mainly on the youth market by advertising through youth-oriented media (Rolling Stone, MTV, late-night programming), creating a flashy website to highlight their brand philosophy, and sponsoring live concerts. Not only does it specifically target the young buyers, but they also simplified their sales tactics by offering no-haggle pricing, which means that Scion dealers will not be allowed to negotiate prices or pressure a potential customer into buying, and giving their customers a high degree of vehicle customization. Because of these marketing tactics, Toyota was not only able to bring in younger customers but it also encouraged Honda and Nissan to consider introducing youth-oriented cars into their lineup.

Toyota’s successes are due largely to its ability to identify growth opportunities and develop market strategies to capture them. First, they achieved greater market penetration by marketing their cars as fuel-efficient, well-built alternatives to the gas-guzzling, problem-prone American cars, which eventually allowed them and other Japanese companies to take a sizable market share away from the Big Three carmakers. Second, Toyota was also able to identify new opportunities for market development and spent time on product development to tap into these markets. The results of Toyota’s product development were the creation of Lexus and Scion, brands that both offer a unique lineup of cars, a unique brand philosophy, and services that target the luxury and youth market. Third, in spite of their successes in capturing new markets and achieving greater market penetration, Toyota occasionally downsizes their products such as the Celica and MR2. To sum up, Toyota is a great case study on how a company should develop, identify, and evaluate market opportunities and how to develop the right products and marketing tactics to capture such markets.

Works Cited
http://www.popularmechanics.com/automotive/new_cars_trucks/2000/1/century_of_cars/ - A Century of Cars
http://www.autocluster.com/autobrands/l/lexhistory.html - Lexus History
http://www.latimes.com/business/la-fi-lexus7sep07,0,2703046.story?coll=la-headlines-business -Toyota’s Lexus Plans a Redesign of Its Lineup
http://www.detnews.com/2003/autosinsider/0304/21/a01-141863.htm - Toyota turns edgy to grab Gen Y buyers
http://www.autoweek.com/news.cms?newsId=100464# - Toyota will drop Celica, MR2 Spyder in U.S. after 2005
http://www.autointell-news.com/News-2001/January-2001/January-2001-2/January-24-01-p5.htm - Toyota statement regarding Reuters story on possible third brand