2012 Mazda5: A Smart Pick, But Lean Feature Set Might Limit Appeal
For most of the time that it's been on sale in the U.S. market—nearly five years—the Mazda5 has been an odd one out in the market—and a niche vehicle, despite its conventional minivan silhouette.
As Mazda points out, compared to the Dodge Caravan, which kicked off the U.S. minivan craze back in 1983, the 2012 Mazda5 is actually about five inches longer—and about the same width and height. Yet it manages to package in a usable third row of seats, and has 157 hp from its four-cylinder engine while the Caravan was under 100 hp.
However minivans, as most of the U.S. market knows them, have become big and bloated, and nearly as big as the full-size Country Squire–esque wagons they were eschewing in the first place.
By sticking to a leaner, more modest minivan, Mazda has surely locked onto a healthy niche market. Over the past several years, the automaker has been quietly selling increasingly more Mazda5 models with virtually no advertising or marketing dollars. And for those who want this kind of vehicle, there aren't any alternatives: Mazda found that 29 percent of buyers for the outgoing generation of the Mazda5 seriously considered no other model when vehicle shopping. That's an enviable claim, for certain.
In looking at its current buyer set, affordability ranked near the top among reasons for purchase. So with the full redesign of the Mazda5, the brand didn't innovate; rather it took the Mazda5 package, gave it a little more refinement and quite a bit more design flair from the outside, and didn't go overboard with features and options that would drive the price up.
The former generation of the Mazda5 was brought over as a sort of experiment—and Mazda ended up selling far more than expected with no significant marketing or advertising. This time there are a few signs that the 2012 Mazda5 was designed with Americans in mind (such as the more ample seat cushions)
As we noted in our First Drive of the 2012 Mazda5, the new version of this van remains one of our favorite people-mover picks as it retains the surprising fun-to-drive qualities of the previous version--and even improves on them. But the resulting 2012 Mazda5 smacks of cost-consciousness. Its interior materials feel very basic and on a budget; there's no direct-injection engine; no power doors, hatches, or seats (though you don't need them here); and it has no USB plug, no iPod controls, and no available navigation system.
Mazda says that it's anticipating that buyers will be bringing their own portable navigation systems or nav-equipped smartphones on board, but it seems to us that an affordable nav option would have a place. At the same time, the typical family that ends up buying a Mazda5 is college-educated and makes just over $90k a year, and it seems that connectivity for their iPhones and iPods would be a priority.
Sound systems are very modest, too. The base system sounds well enough (albeit a little muddy with bass response), but it felt like an old-generation system with a fresh faceplate; it's tuning of Sirius stations was frustratingly slow, and the old orange-lit display will only show a few characters.
Mazda's choice not to innovate with connectivity or entertainment in the Mazda5 might help sell more in the short term, and focus the message around what this van does well: transport a small family with a more responsive, rewarding driving experience. But with the arrival of the Ford C-Max (which we've driven in Euro-spec form) early next year—with MyFord Touch, Sync, and Sony audio on the options list—families looking for a van-like vehicle that's not as mammoth as so-called minivans will have some fresh options.
This story originally appeared at The Car Connection
Auto Sales Finishing 2010 Strong, But Recovery Will Be Slow In 2011
While the U.S. auto market outlook can hardly be called bullish, sales this past month are pointing to some growth, and some further steps toward a rebound, in 2011.
And that rebound still looks quite far away. AutoPacific is anticipating 12.4 million next year, and J.D. Power predicts that U.S. sales will reach 12.8 million next year and potentially a 15-million rate by 2012. Meanwhile Edmunds is anticipating a sales rate of 11.5 million vehicles for 2010 and predicting 12.9 million vehicles sold in 2012. For full-year 2010, J.D. Power is anticipating 11.6 million vehicles sold, and AutoPacific anticipates 11.4 million sales—the same figure that it predicted for 2010 a year ago.
One positive indicator is that even as retail sales are perking up, automakers have reduced new-car incentives levels to their new vehicles, on average, compared to earlier in the economic slowdown. That's potentially related to the easier availability of credit and financing options the past several months, but also due to the introduction of a range of desirable new mass-market vehicles including the new 2011 Chevrolet Cruze, 2011 Hyundai Sonata, and 2011 Kia Optima.
Another piece of good news is the growth in retail—as opposed to fleet—sales. According to Edmunds, sales earlier in the year had been supported by growth in fleet sales, as both rental-car companies and corporations moved to replace vehicles. However, at the end of the year, retail sales are showing signs of a serious recovery, with the retail sector up from 710,000 last month to an expected 912,000 this month, according to Edmunds, while Power puts total light-vehicle sales at their highest seasonally-adjusted level all year.
But as far as five years into the future, AutoPacific doesn't see the U.S. industry returning to the 17-million unit volumes that were seen not so many years ago, however. Rising prices, due both to new vehicle technologies and the upcoming federal fuel economy (CAFE) rules, will limit market expansion, the firm said.
"Even with economic recovery, various economic indicators such as consumer confidence, home values, and perhaps most tellingly, unemployment, remain at worrying levels," said Ed Kim, Director of Industry Analysis at AutoPacific.
AutoPacific emphasizes that the U.S. market will continue to further splinter and segment into smaller niche models and nameplates—meaning that there might be 320 nameplates or more in the market by 2016, which is the last time volume was at the 15.7 million rate predicted for 2016. "Thus, each nameplate will be fighting for a smaller piece of the pie, making it tougher for each of those nameplates to be profitable," argues the firm in a sales forecast.
[AutoPacific; Edmunds; J.D. Power and Associates]
This story originally appeared at The Car Connection
Replacing An Ailing Car? Check Your Timing
From the data found in a recent study by Kelley Blue Book and reported on PR Newswire, there are a truckload of car buyers sitting on the fence contemplating a purchase. It reminds me of the undecided independent voter that each side attempted to reach with endless ads at the end of a campaign. The rest of us think, “How could you have not made up your mind?”
According to KBB, a whopping 72 percent of the in-market shoppers (about one-third looking for new vehicles) they polled said they were undecided on the specific car they wished to buy. Over half of the participants had been in the marketplace for the past year.
James Bell, executive market analyst for Kelley Blue Book, said that shoppers are financially driven right now and that they are waiting for the right deal to appear that will get them to hop off the fence. He sees this as an opportunity for the car manufacturers to tailor their year-end marketing efforts to appeal to these undecided buyers. Does anybody know how to spell R-E-B-A-T-E?
There is an auto repair twist to this survey. Over a quarter of the shoppers said they had delayed the maintenance or repair of their current vehicle due to their economic condition. Over a third of the new car shoppers have delayed mechanical repair for the same reason. This reflects the level of scrutiny that motivated buyers are applying to their purchases. For these potential buyers the purchase of a vehicle is being factored into their decision to avoid the cost of repairs: "By replacing, I can avoid repairing" could be the mantra.
Dumping on the dealer a car with undisclosed problems has always been part of the rite of passage to an upgrade of transportation needs. This works well as long as the wheels don’t fall off the wagon.
This reminds me of a fractured axle on a Windstar, a defect that eventually resulted in a recall by Ford. This failure occurred during the Cash For Clunkers program. The owner had been looking for a replacement vehicle at the time. The customer insisted that we have a welder repair the axle. He then had the vehicle towed to within a hundred yards of a dealership and drove the Windstar in, thus complying with the provisions of the program. The point of this is that in the absence of CFC, this buyer would have come up short in the timing of his purchase.
If you are in the market for a replacement vehicle and delaying repairs, be sure to monitor the vital signs of your current vehicle. Otherwise what you thought might make a good down payment or first lease installment may end up as a liability rather than an asset.
[PR Newswire]
This story originally appeared at The Car Connection
Ford, Best Buy Sync For Success
Ford has been on a winning streak lately, improving vehicle quality, buffing its brand perception, and growing the company's market share. Now Ford has something new to brag about, thanks to a successful pilot program aimed to raise awareness about Ford's Sync telematics system. The program was also a win for Ford's partner in the program, Best Buy, and both companies have plans to expand the campaign in the coming months.
For 30 days, Ford set up Sync demos outside Best Buy stores in Dallas, Texas. Shoppers were invited to slip into Sync-equipped vehicles, where Ford staff provided walkthroughs of the in-dash system, which offers 911 assistance, turn-by-turn directions, hands-free calling and other services we've come to expect from telematics devices. Folks who already owned Sync-equipped Ford, Lincoln, or Mercury vehicles were offered personal tutorials on the system. And all participants were offered a check of their mobile phones to verify compatibility with Sync. In all, 3,500 demonstrations were conducted, and 400 Sync owners took the personal tutorial.
The results were impressive: roughly 70% of participants indicated that they're now more likely to consider purchasing a Ford, Lincoln, or Mercury vehicle, and 80% said that the demo improved their opinion of Ford Motor Company in general. Moreover, before the personal tutorial, only 28% of Sync owners said they understood the service; afterward, about 69% indicated that they understood and would use Sync regularly.
The pilot program proved equally beneficial for Best Buy: over 1,600 customers had their mobile phones checked for Sync compatibility, and afterward, nearly 72% said they'd consider purchasing a phone from Best Buy. (Prior to that demo, the figure was closer to 36%.)
Based on the success of the program, Ford will now offer similar demos at Best Buy locations in California and Pennsylvania.
This story originally appeared at The Car Connection
Ford May Post Third-Quarter Profit Next Week
It's no secret that Ford Motor Company has withstood the current financial storm far better than Chrysler and General Motors. Between its refreshed reputation as a manufacturer of quality vehicles and the fact that Ford was the only Detroit automaker to dodge both bankruptcy and bailout dough, the company has emerged from the economic downturn (if we're truly out of it) stronger and more respected by the public than before. In fact, some analysts are predicting that Ford will announce a break-even or slightly profitable third quarter when it reveals earnings for the period next Monday.
Much of Ford's good fortune is thanks to the company's growing market share. CNW Marketing Research has indicated that Ford gained upwards of five percentage points of U.S. market share over the third quarter of 2009, compared with the same quarter in 2008.
Ford is also benefiting from better prices on its new and used vehicles. A person familiar with Kelly Blue Book rankings has said that two Ford vehicles will appear on the book's forthcoming list of 2010 vehicles projected to retain the most retail value. (NB: no Ford vehicle appeared on the 2009 list.)
A profit or break-even in the third quarter would be in keeping with Ford's surprising Q2 numbers -- which, while representing a loss of $424 million, showed a recovery trend for the company. (Ford's loss a year earlier, in the second quarter of 2008, was $1.03 billion.)
Even with the potential for profit in Q3, Ford hasn't revised its earnings projections, or even issued any sort of formal statement about the matter. To its credit, Ford is maintaining the party line that profits won't be seen until 2011 or later. That sort of fiscal conservatism is likely what's kept Ford out of the deep, deep red that's plagued the books of Chrysler and GM. And who knows? It might even keep Ford ahead of the pack as the public begins to forget about the bankruptcy/bailout and Ford loses that branding advantage.
[WSJ]
This story originally appeared at The Car Connection
Ford Profitable By 2011; Launches New Facility In China
Despite the general unpleasantness that's plagued the auto industry for over a year, Ford is doing comparatively well these days. In fact, given the gradually rebounding global economy and Ford's new strategic alliances in Asia, CEO Alan Mulally feels fairly optimistic about the next two years.
Mulally expects Ford to finish 2009 with a 16% share of the American auto market, based on estimated industry-wide U.S. sales of 10.5 to 11 million units. Although Ford hasn't posted an annual profit since 2005, Mulally says the company is on target to at least break even by calendar year 2011. The company recently instituted a $10 billion debt-reduction plan, which generated a $2.3 billion profit in the second quarter of 2009 (though that's an aberration for now).
Mulally's projections and Ford's future profitability -- indeed, a substantial portion of Ford's future, period -- will hinge on how well the company performs in emerging markets like China and India. It should be encouraging to Ford fans, then, that Mulally made his statements at the groundbreaking for a new plant in the Chinese city of Chongqing. The facility is a joint venture between America's Ford, Japan's Mazda, and China's Chongqing Changan Automobile Company, and it will have an initial capacity of roughly 150,000 units. Presumably the factory will boost Ford's production of Asian-market vehicles like the Focus and Mondeo, as well as the new Figo model we mentioned the other day, which is targeted to India and other portions of the Asia-Pacific region.
Bottom line: things are looking up. For Ford, at least.
[AutoNews, sub reqd]
This story originally appeared at The Car Connection
German Firm Predicts VW Will Surpass GM As No. 2 Automaker
German market research company R.L. Polk today predicted that in 2009, Volkswagen AG will surpass General Motors as the world's number two automaker in production volume. Toyota will likely retain its number one position.
The firm also predicts that global passenger car production will drop some 19 percent in 2009, which would be the lowest volume since 1998. A 19 percent drop would mean production of 52.8 million units total.
A crushing 31 percent drop in GM production volume, who is surviving for just weeks more on government loans before an increasingly likely bankruptcy, is predicted by the same German firm. This is partially due to the especially dismal U.S. auto market where sales have tanked 38.4 percent through March. Volkswagen enjoys far more sales market diversity, selling its products around the world and a relatively small percentage of them in the U.S.
The good news from R.L. Polk Germany; sales should rise again in 2010, continuing that trend to top 70 million for the first time ever in 2012.
This story originally appeared at The Car Connection
Geneva Motor Show: Mazda Unzips The Mazda3 MPS
Mazda's unveiling a third version of its Mazda3 model in Geneva today: the snazzy, jazzy, 2010 Mazda3 MPS. In contrast to its siblings--the respectable Mazda3 sedan and C-segment-ish Mazda3 hatchback--the MPS seems geared toward enthusiasts and weekend tinkerers. In fact, given the added detail of the hood scoop, it looks a lot like the MPS was made to give the Subaru Impreza WRX a run for its money.
The MPS boasts a 2.3 liter turbocharged four-cylinder engine capable of firing up 260hp. (In case you're keeping score at home, the Subaru has a 2.5 liter turbo four with 265hp.) The MPS tops out at 155mph, hits 60mph in about six seconds, and scores an average of just over 24mpg.
All in all, it looks like it the 2010 Mazda3 MPS would be fun for zipping around town. And the four door/hatchback styling might attract some families who want to inject a little zoomy zoom-zoom into their humdrum soccer practice routine. We're not sure how much the MPS will expand Mazda's market share, but then, we're always cranky when we're undercaffeinated. Feel free to put us in our place--not that you've ever needed any encouragement.
This story originally appeared at The Car Connection
