ON THE TABLE

August 5, 2009

GM. In the midst of re-energizing GM's product portfolio, the Krispy Kreme effect seems to have taken hold of GM's product development troops. Some of their key new entries are just too damn heavy, example No. 1 being the new Cadillac SRX, which weighs more than 4500 pounds. And that's in a more compact overall package with no V-8. That's a giant bowl of - Oreo ice cream drizzled in chocolate sauce - Not Good.

Publisher's Note: Some of our readers are taking great umbrage this morning with my description of the Cadillac SRX as being too heavy vis-a-vis the competition. Well, guess what, the Cadillac SRX and its competition are all too heavy. I blame the German manufacturers for starting this runaway weight "creep" in our cars and crossovers (or "mass" for all you engineer types). Mercedes-Benz, Audi, BMW and to a slightly lesser extent Porsche are all guilty of egregious weight gain, and it's screwing everything up. It's real simple, folks. The manufacturers are putting - and we're far too accepting of them doing it too - too much stuff in our cars. All this techno-wonder crap is just that - crap. Tell me the last time you actually used some of the endless "amenities" loaded up on your vehicle. (Oh, how we despise that tedious and overused word around here, by the way. Memo to copywriters, either come up with another word, or better yet just cease and desist from using "amenities" immediately. Please.) I wrote about this subject a few years ago when the Corvette Z06 made its debut at an actually lighter weight than a typical Porsche 911. At that moment in time the world as we knew it had changed forever and Hell had just frozen over. Let's get this straight, 4,000 pounds is not okay or acceptable for an "average" vehicle. It's flat-out unacceptable in my book. Weight is the enemy of all good things when it comes to actually enjoying driving, unless, of course, you stopped enjoying driving. In that case we just can't help you. Too much weight negatively affects handling, responsiveness, "feel," fuel economy, braking, performance, basically everything when it comes to the enjoyment of our vehicles. So don't tell me that 4,000+ pounds is "acceptable" for an SRX or any other allegedly "more compact" crossover. Because it isn't. Period. - PMD

 The Chevrolet Volt. Ever wonder how complicated the auto business really is? Check out Dave Guilford's excellent piece in this week's Automotive News on the challenges GM's Volt Team has encountered in the race to bring the Chevy Volt to the street. Sobering to say the least.

Jeremy Clarkson and Co. Publisher's Note: The video for the season 13 finale of Top Gear is simply a beautifully moving homage to what could be the last of the high-performance supercars as we've come to know them, the Aston Martin Vantage V12. Brilliantly filmed and edited - with the ghostly mesmerizing musical track "An Ending (Ascent)" by Brian Eno blending seamlessly with the scintillating sounds of that heroic V12 - this video should be seen by every enthusiast that ever loved a car, because it encapsulates for a fleeting moment what we've all felt at one time or another about these breathtaking machines bristling with power, speed and passion. And in the midst of this riveting film, Clarkson delivers an emotional body blow with the following haunting words: "It is fantastic. It's wonderful, wonderful, wonderful. What it makes me feel though...is sad. I just can't help thinking that, hence to all sorts of things...the environment, the economy, problems in the Middle East, the relentless war on speed...cars like this will soon be consigned to the history books. I just have this horrible, dreadful feeling that what I'm driving here...is an ending." I sincerely hope that's not the case, but if it is, this one magnificent film will stand as testament to the glory of what once was. - PMD

Edward E. Whitacre Jr. The lanky Texan and new chairman of General Motors Co. told the Wall Street Journal's John D. Stoll in an interview Tuesday after the company's first board meeting since emerging from bankruptcy in July that the car maker must regain market share after years of decline and not lose its No. 1 ranking in sales in the U.S. market. He also said that GM's business plan needs to be "tweaked." Uh, duh. Really? "You clearly don't want to be in a position of losing market share," he said. No, Ed, you sure don't, but halting a 20-year market slide isn't going to be easy, no matter how much you make it sound like it's a stroll by the River Walk. We think Mr. Ed might be a just a tad bit naive when it comes to this auto stuff. We applaud the fact that he lives in San Antonio and is only going to hang here when he needs to - after all, San Antonio as opposed to Detroit? Hell, we'd do the commuting thing too. But still, Mr. Ed, you've got no idea what you've gotten yourself into. Which brings to mind the famous Tex Ritter song of a bygone era - (I Got Spurs That) Jingle Jangle Jingle - a song about movin' on when things aren't looking so good. And just to make you feel at home, we're going to see to it that it's pumped into the RenCen whenever you walk through the lobby. Welcome to The Jungle, Mr. Ed.

(PPG Photo)
This stunning, PPG-painted 1962 Corvette wowed the crowd, got the unanimous approval of the judges and drove off with the coveted “Street Machine of the Year” award for 2009 at the 12th annual Goodguys PPG Nationals held recently in Columbus, Ohio. Known as the “C1RS” the car is owned by Barry Blomquist of Onalaska, Wisconsin. It was designed by artist Eric Brockmeyer and built and painted by Phil and Jeremy Gerber and their team at The Roadster Shop in Mundelein, IL. The C1RS’s body modifications were created in aluminum and then executed in fiberglass. Brockmeyer came up with a paint scheme based on black to complement and accentuate the ‘Vette’s low-slung, swooping profile. The Roadster Shop chose the PPG Deltron® brand product line to enhance the car’s appearance. The Deltron coatings used included DPS 3055 gray primer and DCC 9300 single-stage black along with other Deltron metal preps. Other  details on the C1RS include a Roadster Shop chassis, Bowler T-56 transmission and a 618-horsepower, LS7 Turnkey engine. Inside the car features Italian red leather seats with suede accents, a sculpted aluminum dash and a handcrafted center console. The C1RS took over nine months to complete.

Publisher's Note: We recently had a chance to drive the 2010 Chevrolet Equinox, and beyond the obvious product hits that GM has in the market right now - Chevy Malibu and Traverse, Buick Enclave, Cadillac CTS, CTS-V, CTS Sport Wagon, new SRX, and Corvette ZR1, etc. - we feel the new Equinox may be one of the "stealth" hits for the newly reinvented company, especially considering the fact that it aims right for the heart of the small SUV/crossover mainstream market. While the previous Equinox was barely acceptable, this new Equinox is impressively executed from the inside out. Our tester came equipped in the "2LT" configuration, with the standard 2.4-liter, direct-injected 4-cylinder engine, 6-speed automatic and AWD. We highly recommend the 4-cylinder rather than the optional V6 (even though the Equinox is on the heavy side) because it's just too good of a combination to ignore. The new Equinox is quiet - almost eerily so - competent, nicely proportioned on the outside and impressively finished on the inside. No, it shouldn't be classified as a sport-oriented vehicle - and it's nice that it doesn't bother trying, unlike some other manufacturers who attempt to straddle the sport and semi-luxury camps - but then again that's not its mission. Instead, with a base price of around $23,000, look at the Equinox as a Traverse in a smaller, more efficient package and with all of the day-in, day-out "Chevy-ness" you'd expect from a mainstream Chevrolet thankfully intact. Switching gears, we also had the opportunity to try a loaded ($70,915 on the sticker) 2009 Corvette Convertible. Our Crystal Red Metallic Tintcoat Corvette (with Dark Titanium interior) came equipped with the 4LT Premium Equipment Group (a $10,050 option with a long list of items), forged chrome aluminum wheels ($1,850), the super NAV stereo ($1,750), 6-speed automatic with paddle shift ($1250), dual mode exhaust ($1195), and the optional paint ($750). For those enthusiasts out there who haven't driven a Corvette in a while - or ever, for that matter - you really owe it to yourselves to go check one out before we all start getting our government-dispensed happy pills so we can enjoy our Shiny Happy Smiley cars in perfectly pacified numbness. Let's get this out of the way first: The Corvette handles and stops with the best that's out there, and it's blisteringly quick too. Yeah, the interior is its weak point still - and no, it's not just the materials, it's the fundamental design of the entire space - but quit looking around and concentrate on the road ahead, because when you put your foot in the Corvette it reminds you of everything you've loved about fast cars from Day One. It makes superb noise when you nail it (you must order the dual mode exhaust system for maximum enjoyment, trust me on this one), and it's just simply the way it should be for a V-8-powered rear-wheel-drive sports car while attempting to retain at least a shred of affordability in this day and age. Is it perfect? Oh hell no. Is it fun? Oh hell yes. We're thinking a 2010 Grand Sport Convertible with a six-speed manual would be damn near perfect, or close enough anyway. - PMD

Publisher's Note: Greg Martin has more than three decades of auto retail experience in a variety of capacities including new cars, used cars and leasing. He presently heads The Private Client Group, serving clients acquired over the years and acts as a "market maker" by providing new car dealers with trade-in figures. Greg's next project is Autosports of Atlanta, a boutique used car dealership set to open in the coming months. We thought our readers would enjoy Greg's take on the current state of the used car business, now and into the future. - PMD

WHEN BUYING A USED CAR MAKES NO SENSE.

With few exceptions, the premise behind a used car purchase is to achieve a better value. In my many years in the automotive retail business, one of the biggest and most consistent mistakes I see consumers make is to assume that the modestly used car ( 1-2 yrs old) is the best value. While historically this has been almost invariably true it can no longer be assumed, as many consumer publications would have you believe. But, you may think, the used car costs less. Yes, to buy, but not necessarily to own. This is the important distinction, provided the expected period of ownership is in the typical 1 to 4 year range. I define the cost to buy as the selling price and the cost to own as the price less the used value with the projected cost of use added. One of my favorite shock questions is "Mr. Consumer, which do you prefer, the lowest price or the best deal?" The most common response is "aren't they the same thing?" The answer is not necessarily. New cars always enjoy a cost of use advantage since they carry the full factory warranty, have new tires, brakes, etc., and will likely require less maintenance and customer-paid repair over the ownership period. Generally, there are three common circumstances that can turn the new vs. used equation upside down.

(1) Unjustifiable resale value. The best example of this is the Mini Cooper, number one resale value car sold in America. A two-year-old Mini with average or fewer miles will retail for 4 to 6 thousand less than what it cost new! This assumes no dealer add-ons, which seldom add anything to resale value. When one considers that the new car comes with a 3 yr/36k mile warranty, all maintenance included, and the depreciation difference between the two cars is likely to be no more than a couple thousand dollars, buying used literally saves no money and makes no sense.

(2) Factory subvented lease and finance programs. While these programs are less prevalent than in the past, they are still widely available. To take advantage, the consumer must be sufficiently flexible to select a vehicle in current over-supply, not be merely focused on a particular model. My wife's Mercedes R class serves as a perfect example. She leased a new Mercedes R350 for 33 months, 12k/yr., with no money down for $395/mo. including tax. It cost less to drive this new car than a three-year-old one! Four factors can contribute to making this possible: a) factory cash rebate, i.e., lower capitalized cost b) subsidized finance rate, expressed on a lease not as interest but as a rental charge calculated by a "money factor" c) often unrealistic guaranteed future value, i.e. residual value d) use tax on a lease payment (most states) rather than tax on the full value of the vehicle. The ability to achieve favorable terms on as many of these factors as possible provides the best value as a result.

3) Undisclosed factory cash back to the dealer. I recently had a prospective client who was trying to trade a car he had owned for a very short time, a 2008 Aston Martin V8 roadster. He thought he had made a shrewd move when he bought a car with 2k miles and an original MSRP of $144,400 for only $100,000. I had to inform him that I could sell a new one for less! Aston Martin had a factory program to move the older units with a "secret" $30k back to the selling dealer. The manufacturer is able to keep this rebate undisclosed by requiring the dealer to "punch" the car as being sold, rebating the cash and then ending the program. Many used car buyers make the mistake of assuming that our free-marketplace pricing takes into account all factors. Not so, even among dealers, particularly used car dealers who are often oblivious to the new car market. I recently had a gentleman referred to me by a good client who was looking for a 2008 Mercedes CL63. He had done his homework, or so he thought. He had shopped on Autotrader, eBay, and numerous dealer websites. The car he sought, lower miles, one owner, in black was being offered in the marketplace without exception for $100k to $106k. Imagine his surprise when I was able to sell him a brand new 2009 model, with MSRP of $148k, for $110k. This was possible because Mercedes had just come out with $25k cash back to the dealer. I doubt many Mercedes dealers would willingly disclose this!

I believe that the current state of the world economy has presented us with some unprecedented buying opportunities, luxury autos in particular. As the manufacturers continue to respond with reductions in capacity and the historic pent-up consumer demand begins to emerge, those who wait may look back with regret. The number one rule for the successful consumer is focus on the cost of ownership, not the cost of purchase, in other words value, not price.

Greg Martin, The Private Client Group, Roswell, Georgia. gregmartin123@bellsouth.net

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