28 July 2009

UK Engine Production


While UK car making has slipped over the years, its engine production has increased. In 1999, 2.1 million engines were made. 50% Ford, 13% Nissan, 11.5% MGR and 9.5% Land Rover. Since then GM, LR and MGR have all ceased UK engine production and BMW has come in. So what is the situation today (2008) in Old Blighty with regard to who makes what?

1) Ford; two plants, Dagenham, c. London, and Bridgend, Wales. 1.75m engines (62%).
2) BMW; Oxford. 370k (13%).
3) Toyota; Deeside, Wales. 300k (10.5%).
4) Honda; Swinton, Wiltshire. 200k (7%).
5) Nissan; Sunderland. 115k (4%).
6) Cummins; Daventry, Northamptonshire. 80k (3%).

With 1.65m vehicles made in the UK and over 2.8m engines, clearly many engines are exported to overseas plants. Most of the exporting is done by Ford who supply European plants with their requirements and in future American ones too. BMW make their 4 cylinder petrol engines in the UK, for the MINI and BMWs in Germany.

The bottom line: UK engine making is on the up.

24 July 2009

Cash For Clunkers/Scrappage Schemes


In Europe, governments have tried to stimulate car sales with incentives to get people buying them in greater numbers. The German market has gone through the roof, such is its success. In other markets the reaction has been more moderate, although these schemes do get Joe Citizen into showrooms in larger numbers. Some manufacturers have gone beyond what the government offers; to sweeten the deals even more. The terms surrounding the enticements favour smaller and more environmentally friendly cars.

The US is embarking on a 'cash for clunkers' deal now and it will have some success for smaller cars, most of which I assume will be imported. The Korean car industry will be rejoicing, as it already has scored well in Europe over this and should do likewise in the US of A.

I cannot help but think that unless economies strenghen quickly, the slump after these deals end will be large indeed. I also wonder about the environmental benefit of encouraging more cars on to congested streets. The downturn has actually been good for the earth. Making more cars isn't. So it seems what is good capitalism is not so for the planet.

The bottom line: What a mess man has got into.

21 July 2009

Toyota/Lexus Steady

In 2005, Toyota/Lexus had 11.4% of the world's car/LCV market. It went to 12.1 in 2006 but 2007 and 2008 saw it steady on 12%. In that time (05-08), its Japanese component of unit manufacturing has gone down from 50% to 47.3%. USA car making has also gone down, from 18.1% to 14%, which surprised me. Canada from 4.4% to 3.6%, the UK from 3.8% to 2.7%. Meanwhile, Thailand is up from 6% to 7.2% and China from 2.1% to 6.9%.

Clearly a move from manufacturing in more mature markets toward emerging ones. Understandable considering that is where the sales growth is. I would say that Toyota still relies too heavily on Japanese manufacturing. With the Yen more realistically valued since the financial meltdown, the cost of manufacturing in Japan has increased greatly. This has seen the company go into loss making territory for the first time in its history. Had it moved more car making offshore earlier, it would be in a better position financially than it has become. Of course, hindsight provides 20/20 vision.

Toyota may lose a modest amount of world market share in 2009, as it feels the effect of the high Yen. It will not be a profitable year either.

The bottom line: If Toyota is losing money, then the world of car makers is in trouble.

17 July 2009

JD Power Performance, Execution and Layout (APEAL) Study


You may be thinking that a survey on Performance, Execution and Layout (APEAL) would be done by people with nothing else to do with their time. Apparently, "vehicle models achieving high APEAL scores have been shown to benefit from faster sales, less need for cash incentives and higher profit margins on each vehicle sold".
So there, it does matter. How did various brands fare?

Luxury brands, especially Euro, did well. Japanese and American marques were generally below average. This chart reflects that luxury cars do better and volume brands follow. One can compare how cars fared in classes. Jaguar breezed past more fancied brands like Audi, BMW Merc and Lexus in yet another survey. GM's Cadillac also beating them surprised me though. Saab was one Euro brand that bombed. VW, GM's Buick and Ford did well in mass market offerings.
The bottom line: German premium brands are overrated.

16 July 2009

The End Of The Line For The X-Type


Ford commissioned the X-Type to take Jaguar into serious volume territory. The problem was they were in a hurry achieve this goal. The end result was a reasonably stylish car, if not quite the style a Jaguar car needed. Ford didn't understand Jaguar. It pushed fleet sales at the expense of profit, which hurt resale values. That damaged the reputation of the X-Type to private buyers and it never really recovered.
Also, when a Ford platform was used, the UK press ripped into it for this and that did the car no favours either. The same press has never uttered a peep about Audis sharing platforms with Skodas.

Of course they shouldn't because it doesn't matter. Judge it on its own merits and not on prejudice. Mind you, the UK media is so up itself, reasonableness is not even on the radar, apart from a few exceptions.
When North America pulled the plug on the X-Type I think in 2007, sizable volume was lost. Now the recession has finished it off. I thought it was a reasonable car, not overly striking in appearance but a sensible vehicle which was well made.

The bottom line: A credit to the workers at Halewood, they did Jaguar proud.

10 July 2009

New 2010 XJ Jaguar Revealed


I could say all sorts of things about the new XJ. However, it has basically the same underpinnings as the previous one. You see, the last one was brilliant underneath but was covered by a traditional body, which appealed to older buyers. That didn't cut it. As Jay Leno said at the unveiling, you can sell a young man's car to an old man, but you can't sell and old man's car to a young man. Now they have given it the young man's look, the body the previous model needed. My first reaction was the grille isn't nice but then I thought bold, and frankly that is what is required.

The rear is unusual, French in influence to my eye but I'm not an expert on such matters. Certainly different and clean.


The interior looks a lovely place to be, with tasteful touches of wood grain. It looks brilliant in the photo, better than a darker one I have also seen.


As for Elle MacPherson modelling next to it, well it's hard to notice the car. As I said in an earlier post, when it comes to a beautiful woman or a beautiful car, the auto will always lose. By miles. That said, Elle is a fine choice, refined and sophisticated like the car itself.


A success for Jaguar is on the way, don't you think? Jaguar made 24,000 of the XJ in the year 2000, but produced less than 6,000 in 2008. A new one was badly needed, one with style. The current economic downturn will limit sales, but 2010 should see 15,000 find new owners. A little optimistic? Maybe.
The bottom line: Jag has a winner on its hands here.

04 July 2009

Aston Swanning Around With Toyota


Aston Martin customers often have a small car as well to zip around in, so why not make it an Aston? AM are in a feasibility study with Toyota sell a small Aston based on the clever iQ car (Pic above). Some say it sounds silly but I don't for the following reasons:

1) It will drop the average carbon emissions per car for AM.

2) Beats a small car called a Citroen, Ford or Suzuki. I mean to say who wouldn't want a vehicle with an Aston Martin badge on it?

3) Toyota will gain cachet by being associated with such a prestigious brand.
“This concept — akin to an exclusive tender to a luxury yacht — will allow us to apply Aston Martin design language, craftsmanship and brand values to a completely new segment of the market,” said Dr. Ulrich Bez, Aston Martin’s chief executive.

It would be called a Cygnet (hence the title above), and would sell at the top end of the pricing scale. That rules me out then.
As long as it is a premium mini car, I can't see Aston being hurt by it. So I hope it works. In fact I think it's a winner! Keep working boys.

The bottom line: This is a smarter move than it may sound.