Markethaus Musings

Like many Americans, I am once again looking for the next car. The lease on the current car (Porsche Carrera 4) is expiring in a few months so I'm beginning to think about what's next. I'd love another C4, but I need more room...boys are getting bigger! So...imagine a C4...with 4 Doors. What would that be? And...which dealer will get me the best deal? New or Used? I'll track my shopping on the blog.

Here's what's currently on the consideration list...without extensive shopping.

Audi

Big fan of the AWD Audi. Leaning toward the A6 (would love the RS6) because I need size/room.



BMW

M5...enough said. Probably need snow tires...it will be an all season car. Definitely SMG.


So...the shopping begins...feel free to add cars to my list!

Gas prices have pushed SUV sales down in the month of September, especially the larger SUVs. Ford has even announced the end of production for the Expedition, the full size SUV that was launched only 3 years ago.

Using our reverse logic at MotorAlley, someone's misfortune is often another man's opportunity...now is a great time to get a deal on a large SUV..even on some of the mid-sized SUVs.

Okay, you say, but shouldn't we worry about gas prices? People are overreacting to the gas price shock. Prices will drop again...below $2/gallon and then you'll be glad you bought the vehicle you really needed...and saved a lot of $. The current high prices are a temporary phenomenon and as supplies improve, prices will drop again. Dealers are sitting on a growing inventory of mid-size and large SUVs (especially the domestic companies, GM, Ford and Chrysler Group). To find out how much you can save check out what other people are currently paying for your vehicle of interest and then request a price from a local dealer using our easy, free quote form.

As Kia replaces its US CEO, Peter Butterfield, with the former head of VW and AUDI in the US, I thought it appropriate to comment on the growth of the Korean imports in the US market. Interestingly, the Korean model follows the Japanese experience very closely.

Early Japanese forays into the US market were often ridiculed. I remember the discussion of "rustbuckets" in the 70s and "underpowered rice burners." But the Japanese weathered the storm and continuously improved at the edges of the market...where the Big Three were most vulnerable...small cars.

Same with Hyundai and now Kia. Hyundai was the punchline for many a joke when the first vehicles arrived. No one is laughing now. Both Hyundai and Kia have established themselves at the lower end of the market and are now creeping slowly into traditional "import" territory once occupied by the Japanese and Germans. Their small cars are affordable and quality has improved considerably. The dealerships are increasingly "exclusive" (meaning that dealers are investing in stand alone showrooms because they believe the brand has staying power) and sales are rising. At MotorAlley, we see strong demand in the car segment for both Kia and Hyundai models, especially in traditional import markets on the coasts.

When shopping for a new car, minivan or SUV (and soon, pickup!), it makes sense to test drive the Hyundai and Kia products. You will be pleasantly surprised. Fit and finish are competitive and quality and resale values compare nicely to the domestic and import competition. Best of all, prices are very aggressive at the 650+ Kia and Hyundai dealerships.

VW has always built cars with class leading handling and performance. The first car I ever owned was a VW Rabbit -- back in the late 70's and early 80's, it was the best handling/driving compact car on the market (in my opinion, of course).

Although its recent products are attractive visually and continue the heritage of "driver's cars" we think most of VW's problems with the launch of the new VW Passat and VW Jetta (see photo) have nothing to do with its advertising and more to do with its competitive positioning and product quality.

1. VW price points are aggressive relative to its core competitors (Honda, Nissan, Toyota)
2. VW design is competitive with the core competition, but it's word of mouth on quality isn't as strong

If I were actively shopping for a small, mid-size sedan or large SUV, VW would definitely be on my shopping/test drive list. With sales sluggish, VW dealers and VW may be willing to offer some good deals.

And, if I were VW, I'd probably run some aggressive test drive vs. the competition promotions with internet shoppers.

Subaru and GM announced today that GM would sell its 20% stake in Subaru. Toyota announced it would buy an 8.7% stake in Subaru.

What does this mean? GM needs cash because it is losing money in automotive operations and selling its interest in Subaru generates cash and, hopefully, gives its auto operations more focus on building market share.

It also means that Toyota grows its empire and relationships in the market.

For car buyers, it means that the Saab 9-2 will continue to be built jointly with Subaru (also known as Fuji Industries) but that future collaboration on Saab platforms is now dead.

I've always been a fan of Subaru products because of their focus on rugged, small off road vehicles. They have always had a strong following in import and 4 season markets because of their 4WD capability.