As Expected, August 2010 Auto Sales Sink

All throughout the month of August, reports that the month’s auto sales would plunge surfaced time and again. This reporting was wholly unnecessary or at least overdone as an obvious factor was kicking in: August 2009 was “Cash For Clunkers” time, therefore any comparison with last year would be skewed by that federal government rebate program.

But, comparing month over month figures is how the industry rises and falls even when the numbers are skewed. One of the first to issue their sales report was Volkswagen who cut to the chase in the title of their news release: year to date sales are up by 21 percent. On closer scrutiny, Volkswagen revealed that monthly sales fell by 7.9 percent over August 2009.

Monthly Losers

Nissan went straight to the point with their news: sales fell 27 percent for the month although year to date sales are still up by 14 percent. Honda sales fell by 30 percent, but the Japanese automaker says that it is still ahead of last year’s pace though that lead narrowed to just 1.5 percent.

Toyota sales dropped by 31 percent which means that the world’s largest automaker has fallen behind last year’s year-to-date pace by 6,000 units. Blame all the recalls and bad publicity with having a net drain on Toyota whose position as the world’s largest automaker is in jeopardy regardless. Volkswagen, perhaps even GM, may unseat Toyota this year.

Fab 3

How did 2009′s winners do in August? That would be Subaru, Hyundai and Kia, the only automakers who saw their sales rise in a very depressed market.

Subaru’s sales fell by 22 percent, but they’re still up by 20 percent for the year. Hyundai reported that its sales fell by 11 percent, yet the Korean automaker is still up by 17 percent for the year and on pace to establish yet another sales record. Kia, Hyundai’s cousin, registered a 20 percent decline for the month, but they’re still up by nearly 10 percent year to date.

Detroit 3

The Detroit 3 reported mixed sales results with Chrysler sales increasing by 7 percent for the month and are now up by 10 percent for the year. Chrysler’s rise wasn’t a surprise as it basically had to sit out of  last year’s incentive programs as it recovered from bankruptcy and sought to restart production.

GM sales fell by 11 percent for its four surviving brands though the largest domestic automaker is still up by 5.4 percent for the year. Ford sales also fell by 11 percent, but the automaker is still up 18 percent for the year.

The Rest

Daimler reported sales up by 7.4 percent for the month, though when breaking things out by brand Mercedes was up 10 percent while Smart fell by 72 percent. Mercedes is capitalizing on Lexus’ woes and may regain the top luxury marque spot from its Japanese nemesis this year.

The BMW Group fell by 1.6 percent but is up 5.6 percent for the year. Mazda fell by nearly 26 percent, but they’re up by 7 percent year to date. Other manufacturers were still tabulating their figures when Auto Trends went to press with this article.

The Meaning

What does August 2010′s sales mean? Not a whole lot. Cash for Clunkers was a hard month to go up against, so a significant drop was expected. Going forward, a stale economy may keep sales down for the rest of the year, underscoring that the battered American consumer will be careful when and if they buy a car this year.

Sources: Automaker News Releases

The New MINI Minor Could be Major

By Kyle Simpson

Just when you were beginning to think that MINI would never make a car small enough for you (the Cooper takes up SO much space), there are rumors that they plan to revive the Minor in a new, improved, and smaller package to rival the Smart ForTwo and the Toyota iQ.

With a name like MINI, it’s no surprise that they would want a slice of the micro-car market, and while the old Morris Minor is closer to the Cooper in size and design, the concept art for the latest version of the MINI looks to give Smart cars a run for their money when it comes to compact styling.

Geneva Plans

While most of the information available on this car is still a matter of speculation, it has been announced that BMW plans to unveil the MINI “Mini” at the world famous Geneva International Motor Show in March 2011. Rumors circulate that the manufacturer is working on prototypes at a factory in Munich, Germany (although it has also been said that the project has yet to be green-lighted).

However, the photos released in conjunction with the announcement depict both a two-door and a four-door version of this tiny bubble-car with models looking like a cross between a Smart car and a Scion.

Safety Standards

In truth, a four-door version of this model is probably out of the question. Since the maximum length of the car is currently estimated at 120 inches (which is 27 inches shorter than the mini-est MINI and slightly more than 7 inches longer than the Smart ForTwo), it would be difficult for the manufacturer to adhere to U.S. and European safety standards if they were to make a four-seat model.

And while a three-seat option is always a possibility, it seems much more likely that MINI will leave that little piece of oddity to the think-tank at Toyota and opt instead for a two-seater, taking on Smart as their major competition.

Three Cylinders

One component that sounds like a good fit for this small automobile is the 3-cylinder engine that BMW has reportedly put in the works for their upcoming Megacity line. This would allow the company to cut productions costs as well as allow for a smaller-capacity gasoline engine (both of which could spell savings for consumers). It all fits into a larger concept of “i” mobility that is slowly infiltrating the minds of eco-conscious consumers around the world who commute but do not carpool.

If you’re only driving yourself around, why would you want to spend more on gasoline to power a large vehicle with unused seating? The concept aims for a market in which two-vehicle ownership would include a small “everyday” car that is easy to park, cheap to operate, and produces lower harmful emissions, as well as a larger vehicle that would be in reserve for occasional use as needed.

Cost Effective

While little is yet known about plans for the MINI Minor, it seems that the only thing halting production at this point is attempts by BMW to overcome cost-prohibitive aspects of manufacturing. In other words, they want to make sure they can make it cheap enough not only to rival competitor’s costs, but to ensure profitability. As luck would have it, they are entering into a still largely untapped market with a brand that was named to sell MINI cars.

Author Information

Kyle Simpson writes for Medical Billing and Coding Online where you can find more information about a career in medical billing and coding.

Resources

Autoblog Green: In depth: BMW Megacity Vehicle and Project I

Auto Spies: Entry-level MINI coming to the 2011 Geneva Motor Show

Geneva International Motor Show (Salon International de l’automobile)

Lease Trends Reveal Buyout Surge

Automotive leasing continues to play an important role in fueling the come back of the auto industry as buyers can choose this alternative to traditional financing by “renting” their next car. Over the three decades I’ve owned my own vehicles, I’ve leased just once, but that experience was a positive one. It certainly helped that we returned the car in good condition and with low miles on the odometer, walking away from the car when our lease term came to an end.

Lease Swapping

But not everyone keeps their vehicle to the end of the lease term, choosing to get out from underneath their agreement early. Until recent years canceling a lease was a costly endeavor but due to the rise of leasing services such as LeaseTrader.com, people are much more likely to find someone to take over their payments, freeing themselves from an important financial obligation at a low cost and with no hit to their credit rating.

The folks at LeaseTrader.com are witnessing a growing trend unfold, one involving drivers who are opting to keep their cars once their lease obligation ends. Nearly every lease contract gives lessees the choice of buying out their car at lease end including people who have assumed a contract.

“Drivers can find out a lot about a car when they drive it for eight or 12 months, like how it handles, maintenance schedules and the overall condition,” said Sergio Stiberman, CEO and founder of LeaseTrader.com. “Many people in this situation feel there is low risk involved since they are only committed to the short-term contract to see if they end up falling in love with the car.”

Hot Cars

According to LeaseTrader.com, the majority of customers exercising lease end buyout options are doing so on vehicles like the BMW and 3 Series, Mercedes ML350, Honda Civic, in addition to the Toyota Camry and Corolla. With a lease swap through a service such as LeaseTrader.com, customers are able to lower their car buying costs as there is no down payment requirement present.

In effect, the person who takes over a lease gets to “test drive” a car for many months before deciding whether to keep it or not. If they like the car, they can purchase it at its residual value. If not, they can return the car and look for a new set of wheels.