Can Detroit Be Relevant?
This week, Rick Wagoner, chief executive of General Motors, was at the
Consumer Electronics Show in Las Vegas talking about driverless cars and
the Cadillac Provoq, a concept vehicle powered by a fuel cell.
But bigger news came half a world away, at the New Delhi Auto Expo in
India. Tata Motors was unveiling the Nano. Nicknamed the Peopleís Car,
the Nano is a small $2,500 car that is expected to revolutionize the
auto industry, in India, at least. Tata expects to sell 250,000 a year
in its home country before export to other emerging markets begin.
Such is the new automotive landscape. Last year, the press made a big
deal about Chinese automakers displaying at the Detroit auto show.
Twelve months later, the Chinese will be back, but it is now business as
usual. The Nano and the overwhelming hype surrounding it underlined a
huge shift in the global auto industry. Whether or not the Nano is
feasible as a global product isnít the issue. It just seems moreÖ relevant.
It is ironic that the two events Ė G.M.ís keynote in Vegas, which Mr.
Wagoner boasted was the first of its kind, and Tataís in New Delhi Ė
occurred on top of each other. And it is even more ironic that Tata
usurped the hype with a small lo-fi car.
General Motors has long been criticized for its reluctance to build
vehicles that are relevant in the world of rising oil prices and overall
environmental awareness. G.M. has answered with a string of futuristic
fantasies like the Provoq, but as the Nano has shown, the public simply
wants small cars.
Some of the most popular cars in the marketplace are the Honda Fit, the
Mini, and the Scion xB. This year, Smart starts selling the Fortwo in
America. Even BMW is going small with the 1 Series.
But none of the American automakers seem committed to developing a
proper small car for the United States, which is to say that they are
ceding this entire segment of cars to foreign companies. The Chevrolet
Aveo is a rebadged DaihatsuDaewoo. The Cobalt is a size bigger than the
Smarts and Scions of the world. The Ford Focus that is sold in America
hasnít changed in more than eight years, while those sold in Europe were
completely redesigned in 2005. And when Chrysler ended production of the
Neon, it didnít replace it with anything; the smallest Dodge, the
Caliber, is a size up from the Neon. Detroitís lack of a truly
competitive minicar is the elephant in the showroom. And the more
Detroit boasts about fuel cell and hybrid S.U.V.ís, the bigger the
None of this is new news. It is just the current state of the automotive
world as we approach the North American International Auto Show in
Detroit, which opens to the press on Sunday. Although the Detroit auto
show is the first in the calendar year, this year it actually arrives on
the heels of several major shows going back to last September and the
Frankfurt Motor Show, which was followed by Tokyo, Shanghai and now New
Delhi. In other words, it has a few tough acts to follow.
So what can we expect?
Light trucks and S.U.V.ís will be plentiful. Ford, which will hold the
first press conference on Sunday, has already gone public with
information on the new Explorer America, which will feature EcoBoost,
Fordís new turbo direct-injection engine. It is expected to increase
fuel economy by 20 percent to 30 percent, depending on the size of the
power plant. The Explorer America offers a choice between a 2-liter
four-cylinder or a 3.5-liter V-6.
According to The Detroit News:
Over the next five years, Ford plans to make EcoBoost engines
available on most of its products worldwide, starting with the Lincoln
MKS sedan in 2009. The promise is a big one: up to 20 percent better
fuel economy and 15 percent less carbon dioxide emissions than a
standard engine offering the same horsepower. And unlike hybrids,
EcoBoost promises to deliver these savings in both city and highway driving.
And, while Ford is not giving any specifics on the cost, the
company says it will be nominal. Ford says that at current gas prices,
EcoBoost will pay for itself in about 2.5 years, compared with more than
seven for diesel and more than 11 for a hybrid.
Diesels will also have a strong showing in Detroit. Audi will introduce
a diesel version of its R8 supercar, powered by a V-12 TDI turbo diesel.
BMW will have an array of diesel vehicles, which it promises to have on
sale in American by the end of the year.
There will also be performance cars, like the 620-horsepower Corvette
ZR1 and the 500-horse Cadillac CTS-V, but the key to Detroit ó and what
we will be keeping our eyes on ó will be how Detroit automakers intend
to stay relevant in the widening world. So far, thereís no advance word
on an American small car concept, though all three Detroit manufacturers
seem to have something in the works. Ford introduced a small car concept
in Frankfurt called the Verve and will have a sedan version of it in
Detroit. General Motors recently announced that it was moving forward on
the Beat concept car. And on Friday, Chrysler announced that Nissan
would supply it with a small car to sell in South America.
But could they be too little too late?