July 23, 2010

New Auto Safety Rules Pushed in Congress, but Automakers Stall
A sweeping overhaul of the nation's auto safety laws is stalled - and faces an uncertain fate when Congress returns after its August recess. According to The Detroit News, auto safety advocates urged Congress during a press conference Wednesday to move quickly on an overhaul in the wake of Toyota's recall of 8.5 million vehicles worldwide over sudden acceleration concerns. As public attention has faded from Toyota's problems and Congress has turned its attention to issues like the massive BP oil spill in the Gulf of Mexico, some think that Congress will go home without getting the auto safety measure passed. "We're going to try to move it when we come back after the August recess," Rep. Henry Waxman, D-Calif., chairman of the House Energy and Commerce, said in an interview Wednesday. Waxman's committee in May approved a watered-down version of a bill introduced in the spring. The bill requires the National Highway Traffic Safety Administration (NHTSA) to take action on a host of new regulations, including: fining auto executives who submit false reports $5,000 per day or up to $5 million for a single recall; and increasing the cap for fines against automakers to $200 million, or $25,000 per vehicle - up from the current maximum of $16.4 million per recall. Click here for the latest on auto safety legislation.

Infiniti Means . . . What?
Ever since Infiniti was launched with mystifying advertising images of rocks and trees 21 years ago, Nissan's luxury brand has been hard to pin down. Infiniti's sales peaked at 131,401 in 2005. Last year they totaled 81,089. According to Autoweek, the problem is fuzzy brand awareness caused by more than a decade of sharing vehicles and marketing resources with its larger sibling brand, Nissan. Ben Poore is on fire to fix this. As vice president of Nissan North America's Infiniti Business Unit for the past year and a half, his mission has been to sharpen the brand's image. His most visible initiative is a new campaign, "The Way of Infiniti," which is scheduled to run for five years. TV spots and print ads show traditional Japanese artist brush strokes of black ink bursting into images of Infiniti vehicles and technologies with an underlying message of marriage of Japanese craftsmanship and technology. "Our brand has always been about performance luxury," Poore says. "We've always been there, but we now have a very solid and interesting way of defining ourselves." Infiniti is expected to make several new product announcements next month - likely including a performance sub-brand - to bolster its luxury credibility. Click here for more on plans to improve Infiniti's brand perception.

Mercedes Poised to Pass Lexus for U.S. Market Lead
Mercedes-Benz may take over the top position among luxury brands in the United States after a decade of dominance by Toyota's Lexus. In the first half of this year, U.S. deliveries of Lexus models grew 19 percent, while Mercedes-Benz jumped 25 percent. "It's very likely Mercedes-Benz may take over the lead this year," said Jesse Toprak, vice president of industry trends for researcher Truecar.com in Santa Monica, Calif. "The cumulative impact of all [Toyota's] recalls hasn't really shown up yet. It's more likely to be seen in the second half." Automotive News reports Lexus's U.S. sales growth dropped to 2.7 percent in June while Mercedes-Benz, the second-biggest premium vehicle line globally, posted a 25 percent gain. The German brands are also benefiting from a higher rate of leasing among U.S. customers than Lexus, Truecar.com's Toprak said. More than 60 percent of Mercedes-Benz vehicles are leased, compared with less than 30 percent of Lexus vehicles, he said. Sales of Mercedes's E-class sedan, introduced last year, more than doubled in the first half compared with a year earlier. Click here for information and photo gallery of the Mercedes-Benz E Class. BMW this year revamped its 5-series sedans, which competes with Mercedes E class and the Lexus GS. Click here for more on U.S. luxury market leaders.

AutoNation's Profit for 2Q Jumps 29%
AutoNation, the country's largest automotive retailer, with 249 franchises in 15 states, reported second-quarter profit rose 29 percent from a year earlier as sales rose and it brought in an average of $1,000 more for each vehicle sold. The Detroit Free Press reports that the company earned $47.2 million on sales of $3.1 billion for the April-June period. That compared with net income of $36.7 million on sales of $2.6 billion a year earlier. Click here for a chart comparing AutoNation's net income in recent quarters. Company CEO Mike Jackson said he expects total new vehicle sales in the U.S. to be about 11.5 million for 2010, up from 10.4 million in 2009, the industry's worst year since 1982. "For the recovery to hit its stride, you're going to need higher levels of employment and more stability around housing," Jackson said. Chief Operating Officer Mike Maroone said sales rose about 26 percent in the second quarter in Florida and California, where a large portion of AutoNation's dealerships are based. The company also has benefited from automakers' tighter control of their inventories, which means dealers don't pay for housing unsold cars for extended periods. Click here to read more on AutoNation's profit during the second quarter of this year.

Volkswagen Packs a Lot into the Compact 2010 Golf 2.5
The U.S. version of the 2010 Volkswagen Golf 2.5, available in both two- and four-door styles, was formerly known as the Rabbit (2006-2009). Prior to that it was the Golf (1985-2005). And it started life as the Rabbit (1975-1984). They should just call the thing a Gabbit or a Rolf and be done with it, writes David Undercoffler while reviewing the car for the Los Angeles Times. Despite suffering from moniker confusion, the identity of this compact car has been consistent: It's an economical, practical vehicle that draws on its German heritage and engineering for doses of refinement and poise rarely found in its segment. This latest Golf continues that legacy. Click here for a photo gallery of the Golf. The biggest change for 2010 is the exterior. Volkswagen is in the process of revising the look of the entire brand, and the Golf was the first to go under the knife. The front and rear are more horizontally oriented and use tasteful angles to give the car a sporty and upscale presence, and it is easily one of the best-looking compact cars on the market. This VW's interior is equally impressive. The materials and construction are better than that found in vehicles costing twice as much. Click here to read the entire review of the new VW Golf 2.5 at the Los Angeles Times.

Around the Web
From 0 to 1,000 MPH in 42 Seconds [CNET Reviews]
Driving the World's Cheapest Car [AOL Autos]
Study: It's Actually Safer to Drive on Holidays [Autoblog]
Video: Hyundai Knocks One Out of the Car Park [CNN Money]