UPDATE: L-M TO LA, WAGONS HO, ETC.
by Bob Hagin
February 6, 1998
Six weeks passes fast in the automotive world, and it's always with pleasure that I peruse its goings-on every month-and-a-half. These are the motorland happenings that caught my attention since our last report and my rationale behind their importance:
LINCOLN-MERCURY MOVES TO LOS ANGELES - The last time I remember an American auto maker pulling up stakes and moving to another area was the 1966 relocation of Studebaker from Indiana to Ontario, Canada. But now it's happening again and it's not a desperation move as it was in the case of the Studie. Lincoln-Mercury is belatedly taking the advice of Horace Greely and going west - and you can't get much farther west than Irvine, a college town just a few miles southeast of Los Angeles. Lincoln and Mercury have been going through identity crises for several years and as their customer bases gets grayer, their market shares get smaller. It's hoped that by moving L-M out of the shadow of the omnipotent Dearborn-based Ford brand, the company will develop new products and a more youthful ambiance in the "stimulating" Southern California car culture. "California is more a state of mind than a location," according to Robert Rewey, head man of Ford's marketing group, and the hope is that the Golden State will turn around Lincoln-Mercury's stodgy mind-set.
WINDSHIELD REPAIR VS. REPLACEMENT - On a more mundane level of the automotive world, there seems to be a bit of animosity brewing in the world of glass. Those glass makers who produce replacement windshields for the vehicle repair industry are having trouble coming to grips with the relatively new industry that repairs windshield cracks, pits and scratches. At stake is the involvement of the auto insurance companies who would much rather pay for a windshield repair at $50 to $60 than the $250 and up it takes to replace one. The number of windshield repairs (not replacements) went from 500,000 in 1990 to 3 million five years later. High tech improvements in the removal of cracks (better color matching, undetectable resurfacing, etc.) has changed the public's view of the technique. One inducement is that a couple of hundred insurance companies have waived the deductible on windshield fixes - if the policy holder agrees to a repair rather than new glass.
GREENING THE AMERICAN TRUCK AND SPORT/UTILITY VEHICLE - Big sport utility vehicles and pickup trucks have been getting a bad rap lately as being ecologically incorrect. The off-roaders are considered trucks too, and as such are not subjected to the same smog laws as passenger cars. Although the new generation of SUV's and pickups are being fitted with auto-like emission control devices, the main complaint by environmentalists is that traditionally the rough riders get poor fuel mileage and hence put out more carbon dioxide than a smaller family hauler. The SUV market accounted for a very big chunk of the "personal transportation" vehicle market in this country last year and most were not fuel misers like the Chevrolet Tracker, Toyota RAV4, Honda CR-V or Suzuki Sidekick off-roaders. Big family-type SUVs like the Ford Expedition, Chevrolet Tahoe and Dodge Durango may be facing the same stigma than befell big-engined American sedans a generation ago.
RETURN OF THE STATION WAGON - The cultural problems facing SUV makers are good news for those auto makers who don't have an SUV in their fleets. Volvo, Subaru and Audi are all promoting the theory that the average American family may need SUV-sized extra interior space as well as all-wheel drive for driving in rain, on ice and in the snow, but don't plan to go off-road. Along with Mercedes-Benz, those four manufacturers offer traditional family-type station wagons that deliver drive to all four wheels at little or no fuel penalty over the same vehicles that only drive two wheels. BMW is reported to be building an all-wheel drive version of its 5-Series wagon for the near future, too. Audi pioneered the concept last year with its TV ad that featured a distraught but chic woman performing an ungainly exit out of a tall SUV and then sliding into an all-wheel drive Audi A6. Reports are that A6 sales doubled after that ad.
VOLKSWAGEN BANKS ON NEW BEETLE - The new Volkswagen Beetle is round and cute and there's no disputing the fact that it bears a strong resemblance to the popular low-priced VW Bug of 40 years ago. And that's just fine with the folks at Volkswagen. I remember well that originally, the Meisters of Stuttgart greeted the American proclivity for dubbing their "people's car" with such undignified nicknames as Beetle and Bug with disdain. Those dour frowns turn to grins, however, as sales here climbed to a half-million units in 1970, That year marked the end of the sale of the Beetle hard-top in this country and the fortunes of Volkswagen in America started to slide from that point. Sales took an upward turn last year and the current crop of VW honchos hope that the new Beetle will rekindle Beetlemania in the hearts and checkbooks of many nostalgic Americans.
We're only starting the happenings of the auto world in 1998, so we still have seven more updates to go. And who knows what may transpire in the industry during the next 46 weeks?