North American International Auto Show - Analyst perspective
Alastair Hayfield provides some insights on the latest developments in the automotive industry from the North American Industrial Auto Show in Detroit
This year’s [North American International Auto Show] NAIAS found the weather unseasonably warm in Detroit. Pleasantly, the weather seemed to be mirroring the general industry sentiment too: the last few years have been tough, but 2011 has been better than expected and there is reason to be optimistic about 2012. In fact, when Dieter Zetsche, CEO of Daimler AG, used the Mercedes press junket to say he is seeing signs of recovery in the US economy, it was very encouraging.
There was plenty on show at NAIAS to keep an industry analyst entertained. Here are my thoughts on some of the key developments from the show:
Continuing a trend seen at the IAA event in Frankfurt, major OEMs continue to develop hybrid and electric vehicles and concept cars.
VIA Motors showcased its range extended electric trucks. VIA’s board of directors is a ‘who’s who’ of the auto industry, including Bob Lutz, ‘father’ of the Chevrolet Volt. The vehicles that VIA is promoting offer a compelling value proposition – a more fuel efficient truck, with 40 miles of electric only range, that can then be used as a power source for tools, provide power in remote locations, or be used as a backup power supply if home/work power fails. Initially, this concept might gain traction with fleet operators looking to save on fuel and maintenance costs, but also those who want to add practical functionality to their fleets. The threat to this model comes from improving internal combustion engines, with superior fuel efficiency to current engines. A fleet of trucks with newer, more efficient engines could be just as compelling.
Toyota appeared keen to reinforce its leadership in the hybrid and alternative fuel vehicle space. It showcased the Prius C, the NS4 concept vehicle, and committed to release a hydrogen fuelled mid-sized sedan by 2015. The Prius C is a hybrid vehicle aimed at younger drivers, with the intention that it becomes a gateway vehicle – converting new, younger drivers into Toyota brand ambassadors. The $19k price tag for the base model will certainly make the vehicle more affordable to younger drivers than Toyota’s other hybrid offerings. The NS4 concept vehicle is a PHEV and it is indicative of where Toyota wants to take its vehicles – playing on advanced HMIs that will mimic smartphones and provide cloud-based telematics (in fact, Toyota was the only vendor to mention the cloud to my knowledge). Future vehicles are also likely to feature more innovative safety/security features, and innovative materials; for example, the NS4 concept car featured four different glass technologies.
Ford released a BEV Ford Focus, an addition that complements its hybrid and fuel efficient vehicles. Interestingly though, Ford’s marketing material reveals the major problem facing the hybrid and electric vehicle market. Describing the Ford Focus as giving ‘real-car’ performance seems a way of reassuring consumers that hybrids/BEVs are proper, viable alternative to traditional autos. Is this really necessary, or does it imply that auto makers still have the mind-set that consumers don’t take hybrid/electric vehicles seriously?
Mercedes introduced the Smart For-Us concept based on the Smart ForTwo. The interesting feature was the power socket in the cargo area for charging ebikes. Although unlikely to go into production, it shows continuing innovation around ‘urban mobility’ concepts. Mercedes also introduced two new hybrid E-class vehicles.
Chrysler presented the Dodge Dart – a feature rich compact car based on Alfa Romeo’s Giullietta. Chrysler/Dodge hasn’t had a compact car in its line-up, and this release is one way that it is looking to maintain the momentum behind its recent growth. I think this release also reinforces the on-going trend of ‘feature bleed’ from premium autos to mid- and small-sized cars. Because consumers are opting for smaller, more economical vehicles, small ‘touches of luxury’ that improve the driving experience are becoming increasingly important. For example, all but the base model of the Dodge Dart will feature an 8.4-in. screen on the centre stack, and a 7-in. reconfigurable instrument cluster; features not typically seen on a car that costs south of $18k.
Audi highlighted its use of an NVIDIA chipset for future infotainment and instrument cluster solutions. Audi asserted that more rapid development of technologies and adoption of consumer electronic technologies in the car is essential. In fact, at the CES in Las Vegas Audi demonstrated its gesture controlled HUD.
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Annual Salary Survey
In a year when manufacturing continued to lead the economic rebound, it makes sense that plant manager bonuses rebounded. Plant Engineering’s annual Salary Survey shows both wages and bonuses rose in 2012 after a retreat the year before.
Average salary across all job titles for plant floor management rose 3.5% to $95,446, and bonus compensation jumped to $15,162, a 4.2% increase from the 2010 level and double the 2011 total, which showed a sharp drop in bonus.