Detroit. Last week's column - "The Biggest Bet in Automotive History" - stirred up a lot of reactions, both positive and negative. The ongoing rush to electrification by the automotive industry is fraught with challenges and opportunities. Some players are making clear bets on The Future of mobility being electric, while others are hedging their bets. I clearly stated my position last week, and ironically it's perfect timing then to introduce what I think is the most comprehensive consumer research study on EVs to date, entitled, "CONSUMER VIEWS ABOUT ELECTRIC VEHICLES 2019 – ALL THIS TORQUE AND STILL STUCK IN NEUTRAL." This study was conducted by AutoThink Research. The diverse, mobility savvy readership of Autoextremist.com makes up a large part of the survey sample. The best endorsement I can give to this new study is that its findings are not in lockstep with what I wrote last week, and in fact there are clear differences in its findings from my personal perspectives on the subject. To wit:
The biggest misperception identified by the survey is the widespread belief that EVs and the charging infrastructure are not ready for prime time. The experience of current EV owners refutes that.
Most of the people who think EVs aren't ready for prime time have exaggerated worries about EV battery capacity, driving range, charging speed, and public charging infrastructure.
As the study explains in the introduction, “The global transition from ICE vehicles to EVs has been assisted by improvements on a variety of fronts (e.g., the technology, management, production, and cost of batteries, vehicle charging speeds and infrastructure). Despite this progress, actual consumer demand for these vehicles is lagging and growing very slowly (especially in the U.S.). Many consumers appear to lack a basic understanding about how these various alternative propulsion vehicles differ (e.g., what’s the difference between hybrids, plug-in hybrid electric vehicles, extended-range electric vehicles, and fuel-cell electric vehicles?). In addition, a variety of controversies and conflicting claims have emerged in the discussion of ICE and EV vehicles, and these have further promoted confusion and erroneous beliefs about EVs. Most research on consumer attitudes toward EVs has failed to take the confusion into account or to identify the effects of these confusions and erroneous beliefs on EV consideration.”
At the end of the report, there are seven recommendations (aimed at the auto industry) that are quite thought-provoking and provide a roadmap for gaining electric vehicle acceptance:
Continue organizing and coordinating the independent public charging networks to maximize their use and usefulness.
Automotive journalists and other EV commentators give too much attention and importance to the topic of public charging infrastructure and public charging stations. It’s a much smaller deal affecting fewer people and more infrequently than it has been made out to be.
Let’s fix how alternative propulsion vehicles are categorized and stop lumping extended-range electric vehicles (like Volt and BMW i3REx) in with plug-in hybrids (like Prius Prime and Chrysler Pacifica Hybrid).
Offer extended-range versions of EVs. Stop developing and offering Hybrids and Plug-in Hybrids, which are only prolonging the use of the internal combustion engine.
Stop putting promotional emphasis on the “environmentalism” of EVs. The survey suggests that the environment is not the big driver of EV consideration that everyone thinks it is. It's an unnecessarily politicized side argument that isn't really needed to promote EV consideration among consumers.
Promote EVs for their many practical, convenient, and fun advantages.
The public needs a better understanding of electric vehicles. The automotive industry needs to take greater responsibility for educating the public about EVs and the future of transportation but first, the auto industry needs to better educate itself.
Other points worth noting? The report asserts that a lack of understanding about automotive propulsion systems and erroneous beliefs about EVs are unnecessarily impeding the adoption of EVs. The actual EV ownership experience is more positive than non-EV owners are imagining. EVs are better – much less restricted and limited, with much less “hassle” – than most people are thinking.
Furthermore, the report suggests that EVs and the existing charging infrastructure are ready for long-distance trips (that's what the survey's EV owners report and what the study found when it looked at current charging infrastructure). The EV report also questions the idea that EVs need to be relegated to a second-car position. Forty-four of the 341 EV owners surveyed (13%) are getting by with an EV as their only vehicle.
There is one conclusion in this EV Report that perfectly lines up with my final point in my column last week when I had this to say about the future of electrification: "It’s also the biggest marketing challenge in automotive history as well, because creating demand on a massive scale for vehicles that people don’t even know that they want will be a monumental task."
Many of our readers participated in this groundbreaking study, so I would encourage you to download the report – caution: it's lengthy – and take your time to go through it. It's worth the read.
And that’s The High-Octane Truth for this week.
Download the 284-page report here, or go here to get a quick one-page summary and table of contents.
Detroit. Back in the fall of ’76, when my misguided experiment at getting into the retail side of the auto business in East Lansing went up in smoke, I realized then that my calling wasn’t dealing with upside-down “ups” and the churn and burn of a high volume auto store that operated on the premise of getting people into new cars, whether they could afford them or not (they usually couldn’t).
Not only did I not like it, I detested every minute of it. But the parting words to me by the General Manager before he let me go were classic, as he said that “I just marched to a different drummer.” (Truer words were never spoken, by the way. -WG).
From there my life adventure took me on a wild ride through advertising and ultimately this website, and though I have learned and experienced a lot over the years, I’m still savoring the ride. And why not? There’s still plenty to do and see and experience, and there’s no point sitting on the sidelines waiting for things to happen.
But as someone who was fortunate enough to witness Detroit’s Golden Age up close and from a front-row seat, it’s no secret that the looming transition to alternative propulsion is cause for a great deal of consternation. Make no mistake, electrified propulsion is cool and all that, but there is something decidedly missing from the equation. Yes, the instantaneous torque is indeed impressive, if the bragging rights of having blistering acceleration is all you’re after, but beyond that, what? There is simply no visceral appeal and no sound and fury. I loved slot cars a kid, but that was a long time ago.
The reality for most people is that in the coming transition to fully electric vehicles – unless confined to the urban slog – will only thrive as second vehicles. Yes, if you rumble around the city and that is all you demand from your vehicle you will certainly be able to do just fine with a fully electric vehicle as your only mode of transport. But if you venture out on longer trips, the notion of planning a trip around charging stations is not something that most people are going to want to put up with. Where’s my sense of adventure, you might ask? My sense of adventure is just fine, thank you, but stopping for extended periods of time on a road trip to recharge is not my idea of a good time.
And during the winter months, the effort to live with a fully-electric vehicle in frigid temperatures - with a reduced range by half - is simply unacceptable. Oh, you haven’t heard about range reduction in the freezing cold? You probably haven’t if you’ve only listened to electric car zealots bragging about the advantages of their vehicles. But make no mistake, in the cold weather parts of this country electric vehicle drivers are in for a rude awakening. Want to use that heater? The range goes down. How about those heated seats and that heated steering wheel, if you ordered those options? The range goes down.
That’s why I have to shake my head when I hear all of the rosy predictions about the coming Age of Electrification. I see global auto manufacturers dumping hundreds of billions of dollars on electrification, whether forced to by government regulations or in the blue-sky belief that it’s What’s Next, but the realities of this looming transition don’t exactly jibe with these massively aggressive plans. According to a report from the Manhattan Institute by Mark P. Mills, entitled “The New Energy Economy: An Exercise in Magical Thinking” those realities are sobering. In fact, they’re downright ugly. Here are just a few:
· Hydrocarbons supply over 80% of world energy: If all that were in the form of oil, the barrels would line up from Washington, D.C., to Los Angeles, and that entire line would grow by the height of the Washington Monument every week.
· A 100x growth in the number of electric vehicles to 400 million on the roads by 2040 would displace 5% of global oil demand.
· Renewable energy would have to expand 90-fold to replace global hydrocarbons in two decades. It took a half-century for global petroleum production to expand “only” 10-fold.
· Replacing U.S. hydrocarbon-based electric generation over the next 30 years would require a construction program building out the grid at a rate 14-fold greater than any time in history.
· Efficiency increases energy demand: since 1995, energy used per byte is down about 10,000-fold, but global data traffic rose about a million-fold; global electricity used for computing soared.
· Since 1995, total world energy use rose by 50%, an amount equal to adding two entire United States’ worth of demand.
· For security and reliability, an average of two months of national demand for hydrocarbons are in storage at any time. Today, barely two hours of national electricity demand can be stored in all utility-scale batteries plus all batteries in one million electric cars in America.
· Batteries produced annually by the Tesla Gigafactory (the world’s biggest battery factory) can store three minutes worth of annual U.S. electric demand. And, to make enough batteries to store two-day’s worth of U.S. electricity demand would require 1,000 years of production by the Gigafactory.
· Every $1 billion spent on data centers leads to $7 billion in electricity consumed over two decades. Global spending on data centers is more than $100 billion a year—and rising.
· Over a 30-year period, $1 million worth of utility-scale solar or wind produces 40 million and 55 million kWh respectively. $1 million worth of shale well produces enough natural gas to generate 300 million kWh over 30 years.
· It costs less than $0.50 to store a barrel of oil, or its equivalent in natural gas, but it costs $200 to store the equivalent energy of a barrel of oil in batteries.
· Over 90% of America’s electricity, and 99% of the power used in transportation, comes from sources that can easily supply energy to the economy any time the market demands it.
· Politicians and pundits like to invoke “moonshot” language. But transforming the energy economy is not like putting a few people on the moon a few times. It is like putting all of humanity on the moon—permanently.
· The common cliché: an energy tech disruption will echo the digital tech disruption. But information-producing machines and energy-producing machines involve profoundly different physics; the cliché is sillier than comparing apples to bowling balls.
· If solar power scaled like computer-tech, a single postage-stamp-size solar array would power the Empire State Building. That only happens in comic books.
· If batteries scaled like digital tech, a battery the size of a book, costing three cents, could power a jetliner to Asia. That only happens in comic books.
· If combustion engines scaled like computers, a car engine would shrink to the size of an ant and produce a thousand-fold more horsepower; actual ant-sized engines produce 100,000 times less power.
· About 60 pounds of batteries are needed to store the energy equivalent of one pound of hydrocarbons. At least 100 pounds of materials are mined, moved and processed for every pound of battery fabricated.
· Storing the energy equivalent of one barrel of oil, which weighs 300 pounds, requires 20,000 pounds of Tesla batteries ($200,000 worth).
· Carrying the energy equivalent of the aviation fuel used by an aircraft flying to Asia would require $60 million worth of Tesla-type batteries weighing five times more than that aircraft.
· It takes the energy-equivalent of 100 barrels of oil to fabricate a quantity of batteries that can store the energy equivalent of a single barrel of oil.
· A battery-centric grid and car world means mining gigatons more of the earth to access lithium, copper, nickel, graphite, rare earths, cobalt, etc.—and using millions of tons of oil and coal both in mining and to fabricate metals and concrete. And in case you’re wondering, China dominates global battery production with its grid 70% coal-fueled. EVs using Chinese batteries will create more carbon-dioxide than saved by replacing oil-burning engines.
Sobering realities indeed.
I am all for a visionary future (hell, I love thinking about flying cars as much as the next person). And I love the chances being taken and the ongoing explorations that are pushing the envelope of our transportation future. It’s part of the American fabric to dream big and imagine what could be, and I am all for it. And I am quite certain that discoveries and great leaps forward will be made to make batteries much more efficient and cheaper too. But I am also quite certain that the predominant form of vehicle power for oh, at least the next 25 years or so, will come from Internal Combustion Engines. (I can sometimes see myself with a fully-electric car as my principal vehicle for around town, but I would have to have an ICE-powered vehicle, too, preferably with rear-wheel-drive and a V8. That’s just…reality.)
What does this mean for these manufacturers going all-in on electrification (yeah, that means you, VW Group)? Let’s just call it for what it is: The biggest bet in automotive history. It’s also the biggest marketing challenge in automotive history as well, because creating demand on a massive scale for vehicles that people don’t even know that they want will be a monumental task.
And let’s remember one big thing - this isn’t Hollywood. And just because a company builds them doesn’t mean that people will come and buy them.
Editor's Note: After several weeks of big issues (our 20th Anniversary, the Brand Image Meter and the 1000th issue of AE), Peter is taking a partial breather this week. (He has updated "On The Table," "Fumes," and "The Line.") So we're re-running his column from a year ago, one that resonates even more this year. -WG
By Peter M. DeLorenzo
Detroit. Since this week’s issue falls on Independence Day, I thought it might be appropriate to take a time out and think about this country of ours and what it means to be free. If you’re so inclined, you should take the time and read the Declaration of Independence, because it is a most remarkable document with uncomfortable parallels to where we, as a country, find ourselves today.
It’s quite obvious that too many of us have lulled ourselves into taking for granted what it means to be really free, and it’s not hard to see why. Our most solemn national remembrances are now distilled down to days on the calendar for retail sales events, as if all of the sacrifices of the millions of men and women who came before us are mere backdrops for a deal on a couch.
That this is unsettling for a lot of people across the country is no secret, but it seems that any efforts to quell the commercialism surrounding Memorial Day, Independence Day and Veteran’s Day are dismissed as being inconsequential and unwanted.
No, I am not throwing ice water on what now passes for tradition in this country when it comes to Independence Day - the backyard barbecues, family get-togethers and fireworks, but it concerns me that a large faction of this country goes about making plans for “the 4th” completely and conveniently ignoring what it all means.
So, let this be the slightest of reminders, that you might pause at least momentarily to think about what Independence Day really means.
Let’s start with independence of thought. In a country that was founded on the fundamental principles of freedom, I can’t think of a more essential privilege of living here than the freedom to intellectually explore without the threat of reprisal. Yes, this one essential ingredient causes this country myriad problems at times, but it’s who we are and it’s what we do.
Then there’s independence of beliefs. Whether it be political or religious beliefs, we have rights in this nation that other people in the world can only dream about. People still want to come here based on these two factors alone, just as the original settlers of this land did.
An independence to roam. Now, I know this is a quality of living here that most people have all but forgotten, but we live in a vast country that’s as distinctive as the multiple geographies that define it. And we’ve been free to roam and wander and take it all in for so long that we find it hard to believe that places still exist in the world where you simply can’t do that. Dismiss this fundamental freedom of mobility at your peril, because it’s essential to the American experience.
Things may feel a little grim right now, but I don’t believe for a moment that we, together, can’t rise above the current rancor and savor the independence we all enjoy every single day. And it’s important to remember too that it is our unending privilege to honor those that came before us because we are reveling in the fruits of their sacrifices.
I could go on, but I will leave the rest of this to your own thoughts. Think about the big things and the little things that surprise you and at times astound you about living here. We are so very fortunate to be able to call America our home, because it’s a 24/7 experience that’s simply a wonder to behold.
It’s America Wide Open, and I wouldn’t have it any other way.
Detroit. As the global auto industry goes head-first into electrification and autonomous vehicle development, the concern has been growing among enthusiasts and people who just like the act of driving as in, what’s in it for us?
We are being inundated with press release after press release regurgitating the details about the latest autonomous development, and I have to admit that it’s leaving me stone cold. Yes, well off into the future I can see limited usage for AVs, but for most people who grew up with the desire to drive, and the accumulated experiences and adventures – not to mention the individual freedom of mobility – that came from hitting the road, blind fealty to the notion of AVs is about as compelling as leftover oatmeal.
Yes, of course, I appreciate the technology, and I can see that handing over the control of a vehicle in certain situations – abominable traffic congestion, chaotic city driving, I-80 in Nebraska, etc. – might be the most expedient course of action. But just checking out and becoming totally removed from the act of driving? I’m not interested, and I am quite certain that there are plenty of people out there who feel the same way.
So, I am encouraged by the news coming from BMW this week, because this company is recognizing the fact that there will be plenty of situations in the future where people will want to experience the act of driving for themselves, and it intends on building vehicles that will accommodate that notion.
BMW announced that in the future, its drivers will be able to choose whether they wish to be driven or do the driving themselves. According to BMW PR minions: “With the BMW Vision M NEXT, the BMW Group is revealing its take on how driving pleasure might look in future for those who enjoy taking the wheel themselves. It offers a foretaste of the BMW M brand’s electrified future by placing the focus squarely on the actively engaged driver. Intelligent technologies on board provide comprehensive yet carefully targeted assistance to turn them into the ultimate driver.”
(Images of the BMW Vision M Next from BMW)
According to BMW, “EASE” encompasses all the experiences during a journey when the vehicle assumes the task of driving. “Here, the vehicle is transformed into a living space on four wheels, where the passengers can feel safe and secure. From rest and relaxation, via talking, interacting and enjoying in-car entertainment, all the way to maximum concentration – the experiences on offer with the EASE concept are as varied as the occupants’ needs.”
“BOOST,” on the other hand, stands for the ultimate active driving experience. “The BMW Vision M NEXT provides a glimpse into the future of sporty driving,” says Adrian van Hooydonk, Senior Vice President BMW Group Design. “Where the BMW Vision iNEXT illustrated how autonomous driving is set to transform life on board our vehicles, the BMW Vision M NEXT demonstrates how state-of-the-art technology can also make the experience of driving yourself purer and more emotionally engaging. In both models, the focus is firmly on the people inside. Design and technology make the ‘EASE’ and ‘BOOST’ experiences more natural and more intense.”
The BMW Vision M NEXT concept features a Power PHEV drive system offering the choice between electric all-wheel drive and pure rear-wheel drive, with either all-electric propulsion or the power of a turbocharged four-cylinder ICE. System output of 441 kW (600HP) produces a top speed of 186 mph (300 km/h) and enables the BMW Vision M NEXT to sprint from 0 to 100 km/h (62 mph) in just three seconds. There is also a BOOST+ mode that puts extra power on tap at the push of a button. The maximum range when driving in all-electric mode is 100 km (62 miles). This allows the BMW Vision M NEXT to also be suitable for use in city centers where zero-emissions zones may come into force in the future.
That BMW is on to something here is worth noting. It is staunchly reinforcing its fundamental raison d’etre by emphasizing the driver and the act of driving. I would be thoroughly disappointed if BMW – of all automotive brands – decided to do anything else, even though they have been lost in the woods on more than one occasion of late.
But make no mistake, the other premium luxury-performance players on the automotive scene will offer something much like what BMW is promising. Because in the future, when it comes to mobility - which will be parsed into a million little subsets - brand image wrangling will take on an even more crucial importance.
Consider Porsche, for instance. That Porsche is working on the exact same philosophy as BMW for its future vehicles is no surprise. Why? Because without the pure and emotional essence of driving, why bother shelling out serious dough-re-mi for a Porsche? There will be no reason to, unless, of course, Porsche continues to offer the kind of driving experience Porsche has become known for.
And the same goes for Ferrari. That you will be able to enter a city center in full-electric mode will be a given, and then when you exit the city you will be able to engage the full thrust of the Ferrari driving experience. And you can bet that Aston Martin, Bentley, Cadillac (V-Series), Corvette, Jaguar, Lamborghini, Mercedes-Benz, etc., etc., will all do the same.
Going forward, two things will differentiate the luxury-performance players from the mere commodity cars: Design and Performance.
Design will continue to be the Ultimate Initial Product Differentiator of course, but the luxury-performance brands that adhere to their missions by emphasizing the pure essence of driving will enjoy the most success.
Detroit. The news that GM is investigating bringing the Hummer back, only this time with all-electric power, has been ricocheting around the Internet today ever since David Welch’s story about it first appeared on Bloomberg this morning.
I always considered the demise of Hummer to be one of the real tragedies due to the GM bankruptcy. (Well, that and Pontiac, which I had the distinct pleasure of working on early in my ad career, but that’s a subject for another column, or three.) People may only remember the political incorrectness of the Hummer image at the end of its life, because piling on the brand was all the rage back then, but the Hummer had rocketed on the scene and in short order established itself as the ultimate off-road vehicle. In fact, Hummer had made serious inroads into challenging Jeep’s image with a series of imposing products and exceptional – and memorable –marketing (my favorite from back then was the “Happy Jack” TV spot). And Hummer design clearly influenced Jeep designers long after the Hummer was shelved. (You only have to look at today’s Jeeps to see the lingering influence of Hummer.) In fact, momentum for Hummer was about to accelerate, as the brand was poised to unleash a hot, new, smaller product entry that would have really made its mark in the market.
The Hummer HX Concept, which I had the pleasure of seeing at GM Design even before it appeared at the auto shows (images below), was one of the most intriguing concepts – in any segment – that I had seen up until that point. A young group of talented designers at GM Design were given the design brief, and the result was the HX concept – it was whispered to be called the H4 if it had been produced – a machine that bristled with creativity and interesting features that still resonate to this day. And even though the concept was equipped with a V6, it was no secret that the base model would have a 4-cylinder, and a turbo-Diesel was part of the product plan too.
I strongly believe that the HX/H4 would have launched Hummer into an entirely new dimension, and it had “hit” written all over it. But then the economy blew up in the Great Recession, and for the Washington overlords assigned to “fixing” GM, jettisoning the “gas-guzzling” Hummer brand was an easy call.
But now, the fact that Mary Barra and Mark Reuss are seriously investigating bringing the Hummer brand back – in all-electric form – is really encouraging news. It’s ballsy and bold and suggests that good things – and thinking – are happening at GM at this very minute. It also underscores the internal push to electrification going on at GM right now. Mary Barra has openly stated that GM is building toward an “all-electric future,” but I don’t think people realize what that actually means, or how all-encompassing this new product push will be. GM is hard at work developing BEVs for every segment it currently competes in. Think about that fact for a moment. Yes, the transition from ICE vehicles will take time (and ICEs will still be available for years and years to come), but by 2025 we will see a significant BEV presence on our roads, and GM plans on leading the way with a full range of available BEVs, including, as rumors suggest, the return of Hummer.
Okay, it’s time to pour a giant bucket of realistic on the proceedings here, because the likelihood of seeing an all-electric Hummer on the streets and byways of America anytime soon is pretty much a nonstarter. I am guessing five years from right now is a realistic expectation for the Hummer product cadence to begin, but even so I believe the future for this resuscitated brand is definitely on an upward trajectory.
Brands come and go in this business. Some are jettisoned to the dustheap of automotive history never to return, while others are brought back to have another moment in the sun. That the Hummer brand was cut short due to the bankruptcy (and the hordes of pitchfork-wielding, politically correct zealots who wanted it to die) has been well-documented.
But Hummer was never just an ordinary brand that would go away quietly, or for good, for that matter. There were plenty of True Believers – both inside and outside of GM – who believed in the efficacy of the Hummer brand and considered its carefully crafted premise as the ultimate off-road vehicle to have barely scratched the surface and that there was much more to come. That GM is now considering bringing it back, with none of the lingering negatives previously associated with it, is indeed impressive.
The possibilities for visual and engineering creativity with a BEV Hummer should be exciting to contemplate in the coming years.
Detroit. After celebrating the 20th Anniversary of Autoextremist.com three weeks ago, this week marks another milestone for this publication – our 1000th issue. That’s quite a number and quite an achievement by any stretch of the imagination, and needless to say, we’re very proud to still be bringing AE to you every week.
As I’ve said repeatedly, this business is a swirling maelstrom, a kaleidoscope of the good, the bad and the ugly punctuated by fleeting moments of brilliance by the True Believers of all stripes. And this week is no different.
First of all, how crazy is the FCA saga getting? When the merger between FCA and Renault – you know, the one that everyone was so certain of – blew up after FCA Chairman John Elkann walked away from the deal, the hand-wringing was only just beginning. There are so many more dimensions to the story that it’s dizzying. There’s Renault, but then there’s the French government too. Those two players alone are enough to give any notion of a merger a stiff headache. And then there’s Nissan, whose nose seems to be permanently out of joint because, in the parlance of Rodney Dangerfield, they just can’t get no respect.
Now there are rumors of the talks being revived, with Nissan wanting a much larger cut of the action. One thing that hasn’t changed in all of this is that the clock is ticking on FCA. Beyond Jeep, Ram Trucks and its muscle/police cars the company is clearly not positioned for the future because it is woefully lacking in advanced technology. And the whole idea of merging with another automotive partner is designed to fix that.
Make no mistake, I believe a deal will be made, simply because FCA has no other choices – or interested partners – and time is running out. Any merger with any company will be fraught with problems and unforeseen challenges, and the sooner FCA can get a deal and set about figuring things out with its new partners, the better off it will be. That’s not to say things will go swimmingly well, because they rarely do with heavyweight corporate egos in play. But at this point FCA has no choice; the company must make a deal for its long-term survival.
But as if that weren’t enough, in the midst of all of this angst one of FCA’s top executives has thrown a giant wrench into the works. U.S. sales chief Reid Bigland filed a whistleblower lawsuit against FCA on June 5, suggesting that other top FCA executives were trying to make Bigland the scapegoat for its fraudulent sales reporting practices that embarrassed the automaker – and Sergio Marchionne – two years ago. FCA has withheld 90 percent of Bigland’s pay, according to the lawsuit, and deferred his 2018 annual bonus and stock share dispersal indefinitely in retaliation for cooperating with a U.S. Securities and Exchange investigation into FCA’s sales reporting shenanigans. That this dovetails with the usual chaos – which is standard operating procedure – out in Auburn Hills can’t be disputed, but even this is cause for alarm to the outside investor community. And one more reason that FCA needs a deal, even if it’s just to keep the Bigland lawsuit off of the news cycle for a while longer.
Oh, but that isn’t all of the bad news for FCA. As I suggested last week in my Brand Image Meter column, the writing is on the wall for the demise of the Fiat brand in the U.S. market. You remember Fiat, don’t you? The brand that The Great Sergio promised would set the table for dealers to accumulate vast riches, because it would lead to 75,000 in annual sales by 2013? Well, it seems that Fiat sales peaked at a little more than 46,000 five years ago, and at its present sales rate Fiat will be lucky to sell 10,000 vehicles this year. Or, if you’re counting, that is one-tenth of 1 percent of the U.S. market. The outcome of the Fiat sales adventure in the U.S. wasn’t a surprise to me in the least, but I do feel sorry for the dealers who were unlucky enough to buy into Marchionne’s pitch, hook, line and sinker. They’re crying the blues right now and lamenting the fact that they collectively lost a ton of money on Fiat. It sucks to be them, in fact.
As I said in the beginning of this column, there are fleeting moments of brilliance that punctuate the gathering darkness. And it appears that the True Believers at Toyota are about to unload some serious mojo on the efficacy of BEVs.
Lost in FCA’s non-merger news last week was the fact that Toyota is not only moving its corporate BEV strategy up five years, it announced that it is planning to unveil a solid-state battery before the Summer Olympics in Tokyo in 2020. Even casual observers of the electrification push that is happening around the world know that the weakest link of current BEVs are, in fact, the limitations of the battery technology. And the development of solid-state batteries would be a game changer. Why? Because they’re more powerful, safer and most important, lighter. This is serious breakthrough stuff, folks, and it may just be the jump start that the dawn of the BEV era needs.
It’s no secret that much of this industry remains consumed by controversy, conjecture, hand-wringing, bad decisions, rote behavior and the prevailing sense that the good times are about to end with a thud so, in effect, nothing really changes, right? This week would suggest that indeed, nothing ever really changes in this business.
But at the same time, when I hear of promising developments like the solid-state battery from Toyota, something that would transform the promise of mass electrification into a viable reality, well, I am happy to retain at least a shred of optimism.
And that’s the High-Octane Truth for this 1000th issue of Autoextremist.com.
Detroit. Yes, it’s that time of year again, when Brand Wranglers throughout the Autoverse quake in their bespoke marketing boots dreading our annual Brand Image Meter ratings. I imagine that it’s like waiting for a root canal appointment: You know it’s coming but there’s not a damn thing you can do about it. As for the weasels and wankers who are riding a perpetually weak brand hand – you know who you are – it must be a particularly Bad Day. Ah well, who said life in the auto biz was going to be all bunny rabbits and rainbows, right?
But before we get started, I have been inundated by requests for my take on the potential FCA-Renault merger. As I said last week in “On the Table,” does FCA need a merger? Absolutely. It can’t subsist on Jeeps, Ram trucks and hot rods alone. Don’t think so? Jeep sales are already softening because of FCA’s relentless greed. The Jeep option list – which is an homage to Porsche marketers, the OGs of Greed – creatively gouges customers in the interest of considerable short-term profits, but long-term that pricing strategy will hurt the company. In fact, it already has. And sure, Ram trucks are hot and the muscle-flexing hot rods and police cars keep getting churned out, but beyond that, what?
While FCA has been basking in profits, the company is nowhere with advanced technology. As in, they got nothin’. So, in order to survive, some sort of merger or sellout was always in the offing. Let’s not forget the fact that Sergio was consumed with bamboozling another car company into making a deal with him. GM wouldn’t bite, and VW would only consider it on its terms, which didn’t interest the G.O.A.T. at all. But suffice to say, Sergio knew that FCA couldn’t survive long term in its present state.
But Renault? What sort of fresh Hell is this? Add the perpetual losers at Nissan and throw Mitsubishi into the mix, and you have a bouillabaisse of Not Good. I have read all of the gleeful hand-wringing about this deal, and I must say that most of it starts from the conceit that this deal is a done deal. Why that take is even out there, given the players involved, is beyond me. There are so many variables going into this deal that any shred of optimism should be tabled as soon as possible.
Yes, of course Nissan is crowing “What, us worry?” about the deal, seeing no problem whatsoever, but then again, what do you expect that company to say? After all, it is literally and figuratively on the ropes and completely out of ideas, so a merger sounds just wonderful to them. (Although everyone seems to be saying that Nissan has the technological component that will make the deal strong. Really? We’ll see about that.) And, Mitsubishi? It will go along for the ride too. But Renault has myriad problems that seem to be unending, and any cost slashing promised with this deal remains dubious.
So, the idea that this merger will be a walk in the park is naïve at best, especially given the players involved. There are just too many egos, too many loose ends and too many flies in the ointment to say the least. As I said last week, this is a giant “we’ll see” and let’s leave it at that.
Back to the subject at hand. There’s a reason our Brand Image Meter issue is one of our most-anticipated and widely read columns of the year. Brand image wrangling is the mystery science that brings out the best – and worst – in auto executives, with some being naturally savvy stewards of their brands, while others stumble around lost in the desert, achieving only fleeting success. The rest? Well, to say they well and truly suck at it is being kind.
If we were a certain kind of publication, our Brand Image awards would come complete with glittery trophies and massive publicity campaigns attached, and we would be Ka-Chinging a happy tune as auto companies advertised their success to the world, with the Autoextremist brand logo prominently displayed in those ads. But we’re not slimy purveyors of vacuous marketing streams, thank goodness. We are, however, confident in the knowledge that the AE Brand Image Meter column is in the top three in unique visitors and page views each and every year that we have presented it, garnishing loads of buzz and in some cases, voluminous and pitiful “woe is me” and "we're screwed" hand-wringing in executive suites throughout the industry. And beginning our 21st year of publication, that’s not about to change.
As I said when we first introduced our Brand Image Meter seven years ago, when it comes to the power of brands and the inescapable importance of brand image: “It’s the one thing that car companies – both good and bad – cannot escape. How a brand is perceived can make or break a car company, regardless of how long and illustrious a run that brand has enjoyed up until any given point in time, because one false move or one discordant note can be crippling in a matter of months.”
Not surprisingly, none of that has changed, and image wrangling is now the Number 1 priority in this business. Why? The democratization of technology and luxury has allowed auto manufacturers the world over to have access to the crucial ingredients that make automobiles desirable. And with supplier expertise greater than ever, any car company can dial up a witch’s brew of ingredients to compete in almost any segment they set their sights on. But does having the right cocktail of ingredients mean that success will be guaranteed? Not a chance, because the expertise of the rest of the organization in terms of design, engineering and product development comes into play. And even if the entire package is indeed thoroughly executed to the highest standards, the last and most meaningful ingredient – brand image – has to be there in order for the effort to come together.
Sounds easy enough, doesn’t it? Dial in brand image and everything will be good, right? Yes, but it is just not that easy. Far from it, in fact. This business is littered with strategic missteps, ham-fisted executions, an endless stream of miscalculations and that ever-present danger – rampant cluelessness – that can serve to impede a brand image from resonating in the market. Get it right and a manufacturer can live to fight another day. Nail it perfectly and a company may be able to build sustained momentum for a brand for years to come. Get it wrong and it will guarantee a life of misery for a brand as it flounders and sputters in the market.
Winning car companies understand that expert brand image wrangling can make or break their efforts. Having outstanding products is a fundamental requirement, of course, but knowing how to present those products and being able to expertly nurture a brand’s image completes the equation. And less-than-winning car companies, or car companies only intermittently able to be on their games for whatever the reasons (infighting, lack of talent, abject stupidity or all of the above), pay for their mistakes exponentially, compounding their troubles with each misstep.
Some of the people toiling away in this brand image wrangling pursuit are actually qualified and bring a certain sense of gravitas to the proceedings, but those executives are admittedly few and far between. Others are unfortunately assigned to the marketing function as part of a woefully misguided corporate effort to “round” executives’ experience resulting in ill-equipped operatives who stumble along, wreaking havoc on everything and everyone in their path while attempting to learn the business of marketing by “feel,” which translates into making a bumbling mess of things over the duration of their assignment.
That companies persist in this folly instead of recruiting and nurturing marketing talent remains one of the unsolved mysteries of this business. And unfortunately, the rest, of course, are flat-out poseurs who inevitably turn up lost in the marketing desert in search of a clue. That there is such a wide range of talent in the auto marketing ranks is no surprise, because it’s indicative of the general reality for the business as a whole. But this gaping disparity between a few star performers and the rest in the automotive marketing arena can have a devastating effect on a brand’s image, as you’ll see below.
Yes, some of the brands I’ll talk about today are blessed with auto marketers who actually get it and who know what their brands stand for (and almost more important, what they’re not), and the understanding that sometimes it’s better not to screw things up rather than set the world afire with their “I’m a genius, just ask me” brilliance. Other brands suffer the consequences of marketers who careen around throwing ideas and executions up against the wall to see what sticks, and their respective brand images pay dearly for it.
In this column I grade automotive brands on their fundamental raison d’etre, and of course, in turn, the people responsible for shaping what those brands stand for are directly or indirectly graded too. And believe me, no matter where these marketers fall on the competence spectrum, many of them believe that they’ve got it goin’ on, even though that isn’t even remotely the case.
Automotive marketing is a very big deal. And expert brand image wrangling is a crucial part of making all of the effort to design and engineer great products worthwhile. Billions of dollars are spent on brand image wrangling by the auto companies each and every year. Why? Because having the “right” brand image is absolutely essential for market success. As you’ll see in my following commentary when a company does it well, it shows, but if a company misses even by a little, it can be very costly. And if a company’s marketers screw up, the effects can not only be devastating, they can linger for years.
Executives at the underperforming car companies get into trouble because they actually start to think that they’re selling something they’re not, which leads them to deluding themselves into thinking that their products are something other than what they are. In other words, an incurable case of brand delusion.
And when the people running the company don’t know how and why the brand earned its chops to begin with and are confused as to what their brand stands for now, how can they possibly guide it properly? The painfully short answer? They can’t. And even worse, they allow the wrong products to creep into their portfolios, which ultimately will lead to a corrosive level of brand dilution.
Add to all of this the sobering fact that with the onslaught of electrification, some of these brands are going to suffer greatly. There’s no soul in BEVs to begin with, and subtract the distinctive sounds associated with some of these brands, especially the luxury brands, and you have a recipe for disaster. Generally, every brand should be on alert because of electrification, and the chances it could all go bad for some of them is very real.
On that jarring note, the difference between getting things right and getting them horribly wrong when it comes to this brand image wrangling business is the finest of lines. But then again people are paid very well to do these jobs, so it’s okay to expect them to know what they’re doing, even though some clearly don’t.
So, who is on their game right now when it comes to this business of brand image wrangling? And who doesn’t even have a glimpse of a clue? Who deserves a bone or two, and who will go to bed without a treat? Let’s do it, shall we?
Acura. You could ask the following question of every brand in this column: What is _____ and why does it exist? In Acura’s case, does it represent the best of Honda? As someone who remembers the cool Acuras, like the high-revving Integras and such, I want it to be, but is it really? No. Sure, the NSX seems to check all of the right boxes, but what does it have to do with the rest of the lineup? Not much, it turns out. Acura continues to operate on the fringes of the top-tier luxury-performance segment, and it remains an enigma. Its naming regimen – or lack thereof – isn’t helping. Will this ever really change? I seriously doubt it. The honchos at Acura seem to think that they’re on the right track there. They’re not of course, but unless and until they realize it, it’s more alphabet soup from Acura. And this situation may be enough for the overlords at Honda, but if I was associated with marketing Acura it wouldn’t be enough for me. Are Acura vehicles good? Yes, but you just feel that the brand is perpetually running in place, while lacking in overall juice.
Alfa Romeo. Yes, I really like my Stelvio, and I appreciate the fact that Alfa Romeo is officially the “march to a different drummer” Italian brand, but the painful reality is that Alfa Romeo is a niche brand that will always operate on the far edges of the automotive enthusiast spectrum. I used to think – albeit briefly – that this would be enough for the brand to survive here, but does Alfa Romeo really have a long-term chance in this market? I am beyond skeptical of that now. And if there is a merger between FCA and Renault, I have even less confidence that the brand will survive here.
Aston Martin. If you go by the press releases alone, Aston Martin seems to have to goin’ on. They’re churning out limited editions and special editions, working on their luxury SUV – the DBX – and working on a hypercar for the handful of people who would even entertain the thought of owning one. But is that enough? Fortunately for Aston Martin, the brand isn’t for everybody, and in the nose-bleed segment it operates in, the brand still has an image of speed, power and drop-dead gorgeous design. But will that continue as the brand makes the now-obligatory foray into BEVs? That is highly questionable. But in the meantime, as long as Aston Martin continues to build some of the most stunningly beautiful cars on the road, machines that unquestionably live up to the legacy of the brand, it will be fine.
Audi. Audi was chugging along, increasing sales month after month and year after year, and then wham, the bottom fell out. For reasons that still make no sense, despite Audi’s endless explanations, the lack of availability of its highest volume vehicle in this market – the Q3 – has devastated the brand. Dealers are rightly pissed off, but even more important, Audi intenders are wandering away from the brand because the new Q3 won’t be available in any quantity until fall. This should be a painful lesson for all manufacturers, because just when a car company’s operatives think that things are good and that it looks like it will continue indefinitely, the proverbial shit hits the fan. Audi has worked hard to ascend to the top tier of mainstream luxury brands here in the U.S. along with BMW, Lexus and Mercedes-Benz. But this episode has opened a very large can of worms for the brand. Upon closer inspection, it’s not only the lack of availability of the Q3, it’s the fact that Audi prices are just too damn high. When it was a happening brand it could get away with its own version of the classic German automotive arrogance, but now? Not anymore. Add to all of this the fact that the new Audi e-tron BEV SUV isn’t exactly – ahem – flying off the showroom floor, and Audi isn’t just a brand in flux, it’s in serious trouble. I am confident that the Marketing Meisters at Audi will still take themselves much too seriously and allow their “holier than thou” attitude to dominate the advertising, which results in smarmy and annoying work. But that isn’t going to do much to alter the perception of Audi right now. It’s no longer a happening brand, even though Audi operatives refuse to admit it. No bones for you, Audi.
Bentley. Okay, to me the Bentayga SUV is a giant waste of time and money, but this just in: Bentley can’t make enough of ‘em. Is the Bentley brand intact even after its foray into giant SUVs? Sort of. In fact, some would argue that the brand has been made even stronger. Not me. Bentley is teetering on becoming just another car company, and whether it can survive this latest chapter remains to be seen. I would still take a Continental GT V8, thank you very much, but if I see one more Bentayga on the road I am going to puke. Bentley’s raison d’etre is being seriously challenged here; the company just doesn’t know it yet.
BMW. The ubiquitous German brand, which once upon a time in a galaxy far, far away created its destiny with the funky little 2002, has shockingly become the Chevy of German luxury brands, the result of leadership teams over the years pushing the brand into every segment – both real and imagined – that seemed to make sense. This quest to be in every garage in every well-heeled community in America has delivered vast profits for the propeller brigade, but it has gutted its brand integrity. Yes, they still crank out “M” versions to remind everyone of what they used to be, but they’re not fooling anyone anymore. BMW is just another car company cranking out SUVs and Crossovers because, well, that’s what it is now and that’s what this business has become. Add to that the brand’s constantly increasing prices, and you have a giant wiener schnitzel of Not Good. BMW’s brand image is lost in a choking haze of profitability over integrity, and there’s no point wishing that somehow this will change, because whatever BMW’s brand image once was, it’s not coming back.
Buick. A fully engaged SUV and Crossover company now, Buick is even adding a slightly bigger Encore to the mix – the Encore GX – because, well, they sell so many Encores that another one can’t hurt, right? (It kind of reminds me of the Halcyon days of Oldsmobile when if one Cutlass was good, six of them would be even better.) The Encore has been so successful that it has basically saved Buick in this market. In fact, GM’s upper management actually believes that Buick has it goin’ on based solely on the sales performance of the Encore. What does it all mean? You can forget about all of those visually arresting Buick concepts from the last few years, because Buick is all-SUVs-and-Crossovers-all-the-time now. With a brand image as memorable as that old pair of socks that never leaves your sock drawer.
Cadillac. Cadillac just unveiled the new CT4 – the car formerly known as the ATS – and the new CT5, the car formerly known as the CTS. With V-Series versions of both (See “On the Table” -WG). The streamlining of the Cadillac model lineup is logical and a very good thing, with the CT4, CT5 and CT6 on the sedan side of the equation, and the XT4, XT5 and XT6 on the SUV side, along with the Escalade (the next-generation of which is rumored to be a showstopper). The fact that Cadillac is still offering sedans is refreshing, as not everyone out there is craving an SUV, and I believe Cadillac can make hay with that fact. I don’t care for Cadillac’s naming regimen, but they’re committed, apparently. But just a reminder, when it comes to the can’t-mistake-it-for-anything-else street cred worthy of the brand? The Escalade rules. And it’s the only Cadillac with a name. With the Cadillac lineup finally in place, what becomes the most crucial factor in Cadillac’s potential success? You guessed it, marketing. Cadillac marketers have the monumental task of creating that magic I want one for the brand. And that’s beyond making consumers take notice; it’s creating the desire for the brand that has been woefully lacking. Cadillac has a historical legacy unmatched by few automotive brands in the world, yet it doesn’t occupy nearly enough space in the luxury market, which is a giant wreath and crest of Not Good. No bones available. At least not yet.
Chevrolet. I see no reason to alter what I said last year about Chevrolet. No marketers have done less with more than the people charged with nurturing one of the most iconic American brands of all time. Think about that for a moment. These stumblebums have taken a larger-than-life brand that has thrived over the years with some of the most heroic, memorable car advertising campaigns of all time, and turned it into a slick version of marketing “small ball.” Chevrolet’s once-proud image has been reduced to a series of glorified retail spots that insult our intelligence and annoy with equal aplomb. Throw in the insipid “real people” advertising, and it’s a marketing cocktail that absolutely no one is interested in except the so-called “marketers” down at the Silver Silos. But then again, they are absolutely convinced that they have it goin’ on, so it’s to be expected. This just in: They don’t. (I will throw a couple of bones in the direction of the “Tailgates” spot for the Silverado, however, because it is the best spot to come from the brand in a long, long time.) Our resident local media homers regularly tout how wonderful, how smart, how enlightened and how visionary Mary Barra is in a cacophony of the usual blah-blah-blah. That’s all well and good, and at least somewhat deserved, but as long as she continues to ignore the blatant mediocrity on constant display by GM’s so-called marketing troops, Chevrolet will continue to languish in The Land That Time Forgot.
Chrysler. The “C” of the company formerly known as FCA is fading away, but it continues to hang on to the Chrysler Pacifica. That the Pacifica is part of the competitive set of minivans to consider if one is interested in those particular vehicles is still a given. And that’s about it.
Corvette. Once upon a time, the Corvette was the quintessential definition of a “halo” vehicle for Chevrolet. The notion that “there’s a little bit of Corvette in every Chevrolet” was used to great effect back in the day. Not so much today. Despite the fact that the Corvette is one of the best high-performance cars in the world, with an impeccable and accomplished record in racing, GM – and Chevrolet – really doesn’t do much with it. Oh sure, the enthusiast media and enthusiasts in general are well versed in the goodness of the Corvette, but you’d barely notice it exists at GM. That’s about to change, I hope, with the rollout of the eighth-generation mid-engine Corvette that will be introduced to the public in July. This new Corvette will be a milestone machine, one that represents the latest – and very best – thinking of GM’s True Believers. This new Corvette must attract new and younger buyers to the brand in order for it to succeed, and based on all the information I have, there’s no reason why it can’t. But – and this is still a giant “but” – GM marketers will have to get their shit together and not do their usual phone it in approach to marketing this new Corvette. That’s a tall order, and needless to say they can’t afford to screw this up. Despite the many previous GM marketing missteps, the Corvette name and image still shine through, and I expect that it will only be enhanced with the new mid-engine car. In fact, until further notice, the Corvette shares the top tier in our AE Brand Image Meter with five other brands.
Dodge. Muscle cars and cop cars are this brand’s thing. Is that enough to go on? Will Dodge survive the proposed FCA merger with Renault? With now-ancient chassis underpinnings and a ton of cash needed for a..
Detroit. Twenty years ago, when I became tired of what the ad biz had become, tired of the ass kissers and the other two-bit players who had turned what was once a pretty interesting profession into a vapid wasteland, I knew I had to do something different. I had also grown tired of seeing the auto business – as practiced here in Detroit – sink further into the Abyss of risk-avoidance-driven mediocrity, and watching legions of so-called "executives" make horrendous, piss-poor decisions day after day on behalf of their respective auto companies.
As I watched the carnage unfold around me, I knew that something had to be said by someone who had firsthand knowledge of what was going on – someone who was in the trenches and on the front lines of the ongoing battle.
That someone turned out to be me. And Autoextremist.com became my forum to say it.
As some of you may recall, Autoextremist originally was a concept I had for a new car magazine back in 1986. The print version of Autoextremist was going to target hard-core enthusiasts, while telling it like it is with a distinctive, combative style. It would also be the first enthusiast car publication that wouldn’t accept advertising.
The state of the enthusiast car mags back then was a dismal parade of sameness that left me cold, and I was determined to breathe some life into the genre (and it is different today, how? –WG). But my ad career got in the way, and by the time I looked up it was the late spring of 1999, and I knew that if I didn’t do it then, I’d never do it – so the time was finally right for Autoextremist. The Internet, of course, would replace the print magazine idea, but the essence of my original manifesto written back in 1986 remained unchanged.
And that's how this publication and "The High-Octane Truth" came about, whether people were ready for it or not. A lot has changed about this business over the ensuing years, but as I am continually reminded, a lot hasn’t.
Over the course of the past 20 years, it has been The Best of Times, and it has been The Worst of Times. And it has been a journalistic rocket ride like no other. When we started this publication back on June 1, 1999, there was no real plan other than that I was ready to recount a lifetime of automotive history that began in Detroit’s heyday, combine that with my life’s work in the auto advertising and marketing trenches, and blow the lid off of the status quo in a business that had become petrified and jaded. I was going to tell the real stories and name the real names, and I wasn’t going to hide behind the usual journalistic chestnuts of “deep background” and “off-the-record” sobriquets. I was going to make people accountable in a business in which not being accountable had become a cottage industry.
Back when we started AE the car business as writ large here – this once-glorious, exuberant business that created The Arsenal of Democracy and made up the fabric of American industrial might – had become overrun with bloodsucking parasites and spineless weasels.
This industry that once boasted industrial giants who roamed the earth creating fabulous machines while leaving heroic legacies in their wake had been reduced to a mewling chorus of sycophants making excuses for what couldn’t be done and why “they” – aka Detroit – couldn’t compete, while churning out mind-numbing, rolling monuments to mediocrity that drove millions of consumers away, for good.
Watching Detroit’s collective market share do a pirouette into The Darkness was not so much sobering as it was frightening, and my writings took the fight to these purveyors of boneheaded excuses and feckless mediocrity and changed the conversation forever.
I challenged every single convention and blew the lid off of the excuse-making machines that the car company PR functions had become, and turned this business on its ear, which was, in reality, much harder to do than it sounds now.
But think about the relationship between the press and the auto companies back then. There was no news or opinion of any substance, just rote regurgitation of the auto company press releases with an occasional “tough” question thrown in for good measure. And if it was too “tough” an editor would get “the call” and be taken to the proverbial woodshed by the Chief PR minion because, well, you know, it just wasn’t done. And for their penance the offending scribes would be denied access to a top executive – especially the CEO – which at the time was akin to the death penalty. Without access they wouldn’t be able to distinguish themselves in the swirling maelstrom of predictability that the industry press corps had become. Without access, they were pretty much dead.
But the key differentiator for me was that I didn’t care about access, because I not only knew the Detroit auto executive mindset intimately, inside and out, I had it down cold. I knew what they thought and why they were thinking it. So much so in fact, that on more than one occasion – okay, make that more times than I can even count – I heard comments from top executives that went something like this: “I don’t know who you’re talking to, or where you’re getting your information, but it’s so uncannily accurate that it is scary.”
In fact, it was so disconcerting to the car company PR minions that it struck fear into their very hearts and kept them awake at night. And as they watched their digital clocks tick over with a sickening thud in the middle of the night, the prayers that could be heard in the darkness sounded achingly similar: “I hope he stops. Or starts writing about somebody else. Or gets hit by a truck, whichever comes first, Dear Lord.” But those prayers fell on deaf ears.
I am gratified to say that Autoextremist.com changed the tone and tenor of the media coverage of this business once and for all. Countless imitators and wannabes sprang up and are still springing up to this day. I have had writers attempt to copy my style while brazenly calling it their own, and I’ve even had Internet trolls blatantly steal my copy and post it on their websites thinking no one would notice.
But it didn’t really matter in the end, because the voice – and the impact – of Autoextremist.com rang loud and true and has been powerful for, as hard as it is to believe – 20 years – and the imitators and freeloaders slunk away from under the rocks from whence they came.
I walked away from car advertising because the relationship between the car companies and their ad agencies had become so polluted that it was too embarrassing for words, a sickening dance of egregious malfeasance that was an insult to the craft – on both sides of the ball. What had once been a pretty damn great way to make a living – one filled with bristling creativity and collaborative excellence – had deteriorated into a cesspool of go-along-to-get-along cowardice and “thank you, sir, may I have another?” bullshit. The profoundly inept were leading the spineless order takers, and the resulting chaos masquerading as marketing was devastating.
Is it better now? Well, let’s see, two of the three American car companies went bankrupt ten years ago, with one of those being gifted to a foreign car company because no one else had a better idea about to how to save it. But, let’s get back to the question – is it really better now?
Yes and no. The products are better, make no mistake about that. In fact, we are experiencing the finest machines in automotive history at this very moment in time. And that is no insignificant thing.
But the romance and art that once fueled this business, and the passion and willingness to do great things and strive for excellence that took it to lofty heights, are now confined to the thriving pockets of True Believers spread out among the car companies. These are the people who keep the passion of this business alive and who stay true to their beliefs against overwhelming odds. Because in reality this “new” auto business has been defined by the deal makers and the interloping carpetbaggers hell bent on maximizing their balance sheets while embracing commoditization and globalization. The art of the machine means less than zero to them and has become irrelevant, and the art of this business is dying with it. And it’s sad.
As I’ve said repeatedly, this business isn’t for the faint of heart. And though it seems that there are legions of recalcitrant twerps and two-bit hacks running around out there who add nothing of import to the discussion and who pump up their self-worth for reasons that remain a mystery, the real essence of the business remains unsullied.
When we first contemplated doing Autoextremist, I wrote a manifesto for what it was and what it was not. And I am proud to say it still resonates today.
I began with the premise that designing, engineering and building automobiles is one of the most complicated endeavors on earth. And to do it properly takes vision, creativity and an unwavering passion that makes other pursuits seem positively ordinary. Note that there is nothing in there about doing it just good enough to get by, engineering to the lowest common denominator, covering your ass or any of the other pillars of “standard operating procedure” that once dominated certain quarters of this business and have been, for the most part, purged.
Except that isn’t really true, unfortunately. All the bad old habits are still present and accounted for and then some, and as much as reasoned, logical and eminently bright executives in charge at these auto companies protest otherwise and insist that “we don’t do that stuff anymore,” that kind of bad behavior is just a bad product or marketing decision away from rearing its ugly head, and usually at the most inopportune time too.
From the very beginning we exposed the go-along-to-get-along, kick-the-can-down-the-road hordes on a regular basis, because the damage they cause can bring these companies to their knees in a heartbeat.
A key point in the Autoextremist Manifesto? Mediocrity – in any way, shape or form – isn’t bliss. Instead, it’s an insidious disease that has not only decimated this industry, it has screwed up life as we used to know it too.
At some point this business – and American life – turned down the wrong path. Pushing the envelope, getting knocked down and picking yourself back up and going at it again, battling to the buzzer, and striving for achievement were part and parcel of the upward trajectory of the automobile business – and country – we used to live in. Achieving greatness wasn’t just a goal, it was an expectation to shoot for, because anything less would be, well, ordinary. And even worse, boring.
Today this business has too often given way to an unspoken attitude of just doing enough to get by because when it comes right down to it, judging by the chorus of muttering I hear, doing more begs the question, “Does it really make all that much difference?” Fundamental accountability has been replaced by “It’s not my problem.” And “It’s okay, at least you tried” has become more than just an acceptable phrase, but a mantra that too many people live by. After all, when everyone gets a group hug and a trophy just for showing up, why bother extending effort to do better, or achieve greatness, or strive to be the best?
Why bother, indeed.
The result? Abject mediocrity. And it’s everywhere. It’s in this business and it’s rampant throughout the country. Some people have actually said to me (and with a straight face too), “Get over it, it’s the world we live in today.” But I’m not buying it and it is simply unacceptable to me, which is why I will continue to call people and companies out on it whenever and wherever I see it. It’s not a value-added path for this business, and it’s already proven not to be the answer for the country, either.
The stellar machines of our day – and we are living in the golden age of automotive greatness in case you haven’t noticed – aren’t the product of “it’s good enough.” Instead, these machines bristle with the passion, vision and commitment of the men and women who created them, those “True Believers” that I often write about. If it weren’t for them, this business would be riding on the Last Train to Nowhere, next stop, Oblivion.
To say that Autoextremist.com has been a labor of love doesn’t even begin to cover it. It has been my passion – and my life – for 20 years. And I’m not going to say that the time flew by either, because it hasn’t. I have lived every single moment of it and every bit of it is seared in my memory.
Suffice to say that you have no idea of the time, effort and energy that it has taken to deliver the Bare-Knuckled, Unvarnished, High-Octane Truth to you every week for two decades now. And if you knew, I mean really knew, you would be shocked. It has been an up-at-dawn, pride-swallowing siege – as Jerry McGuire once famously said – that few people can comprehend and even fewer will even begin to understand. (Actually, make that pre-dawn, as Peter starts writing at 3:00 a.m. most days. -WG)
It was our blood on these tracks. And it was our unwavering passion and unflinching standards amidst the torrent of mediocrity and just plain dismal behavior on the Internet that stood out. That’s not just us talking, that is the consistent refrain we hear from upper echelon auto executives, members of the media, and from a countless number of our readers out there, week in and week out.
The fact of the matter is that you can go anywhere and read anything about cars on the Internet, but we’re extremely grateful and proud to say that the best and the brightest came here.
I have been going back and forth for several years now about what would happen on the 20th Anniversary of Autoextremist.com. How I would feel about it, what would it all mean, and most important, how much longer would I do it? How much longer could I do it? And so on.
But the reality is, when faced with the real possibility of pulling the plug on Autoextremist.com, I have come to the conclusion that I am not ready to walk away from it. Yes, I will admit that it is a giant pain in the ass sometimes, because we’ve set a high standard here that isn’t conducive to phoning it in, or going through the motions in any way, thank goodness. And those high standards push me to keep bringing the High-Octane Truth to you every week.
And frankly, the days I have been sick over the last couple of years have helped me sharpen my focus and my thoughts even more and helped me realize that there are no free rides or guarantees in life. I am lucky in that I found something in Autoextremist.com that has kept me motivated and sharp for 20 years. And I truly appreciate the fact that I have it.
We’re very proud of what we achieved here, and extremely thankful for the support, for the kind words and for all of the True Believers we’ve met along the way.
It has been all-encompassing. It has been tough. And it has been, at times, soul-sucking exhausting. But if I had a do-over, I would do it all over again. Because even though it has been a relentless grind, I am very proud to say that we’ve made a difference and we’ve made a lasting impact. We set out to influence the influencers in this business and that is exactly what we did and will continue to do.
It has been one glorious ride.
WordGirl and I thank you for listening and, as always, thanks for reading.
And that’s the High-Octane Truth on our 20th Anniversary.
The Autoextremist. East Lansing, Michigan, March 1976.
Detroit. For all of the creative thinking and instances of intermittent brilliance demonstrated by its talented True Believers, this business is plagued by an oppressive layer of rote thinking and lemminglike behavior that is beyond frustrating and that has routinely wreaked havoc on the proceedings over the decades.
Why, you might ask? Auto companies are obsessed with other auto companies when it comes to product and marketing and just about every other aspect of the business. Part of the reason is that this business is an inveterate gossipy sewing circle that ebbs and flows with the prevailing winds. Model intros, press events and auto shows are chock-full of news that flows through the media and out to the wider audience, which is, first and foremost, made up of the other auto executives and their minions who have an insatiable need for any and all information about their competitors. Throw in the fact that the suppliers are a hotbed of hearsay, and you have a kaleidoscope of rumors, conjecture, hard but inevitably garbled facts, advanced intel that is shockingly accurate (but gets lost in the fact that there’s a thread of disbelief associated with it), and everything else you can imagine swirling around at a furious pace. And thus, it was ever so.
The result of all of this is that eerie and just plain weird occurrences happen all the time. You see it most in design trends that appear and become the look of the moment spread across a wide spectrum of the business overnight. How does this happen, exactly? Especially when designs are created with crushing lead times in top secrecy? One reason is that young design talent is being trained with a new level of discipline and professionalism in this business, which is commendable. But there’s a sameness that develops in that indoctrination too. Similar perspectives, similar training and similar points of view rear their heads eventually. The other reason is that everybody talks in this business, especially designers who get together to shoot the breeze. It’s no wonder that trends and design “signatures” you see in the models developed and offered not only seem so similar, but they somehow arrive at the same time.
It doesn’t end there. Engineering and technical features are another hotbed of a kind of, “if Belchfire Motors is going with it, we’re not going to be left behind” type of behavior. Suppliers play a huge role in this, too, tipping off each other and their competitors alike about the latest gimmicks and come-ons that are on the way. And certainly, the explosion in AV and BEV research and development and the massive spend on new technologies has yielded, not surprisingly, similar pursuits – and results – with only subtle nuances to distinguish them from each other.
And then, of course, marketing isn’t left behind in all of this either. The strategic lingo used, the tone of the advertising, the executions, the national sales event advertising, the eerie similarities are all there right out in the open. And behind the scenes, trend words and industry jargon spread like wildfire because, after all, if you’re not on top of the latest marketing speak, you’re basically nowhere, which is a fate worse than death in this business, especially in the marketing arena. No other pursuit parses consumer information down to the last minutiae more than the auto business. The net result of all of this varies widely, because the genuine success of a marketing campaign ultimately hinges on hitting upon a compelling piece of creative, much to some marketing strategists’ chagrin. (After all, an accepted adage in this business – at least by clients – is that if a marketing campaign is a success, it’s because of the astute strategic thinking on the client’s part. If a campaign fails, however, it’s somehow always the ad agency’s fault.)
You only have the look as far as the new TV commercial for the Chevrolet Silverado called “Tailgates” to see what I mean. It’s more compelling and memorable than any of the launch advertising that was initially created for the new Silverado, and I’d be willing to bet that the idea didn’t originate on the client side, either.
But the largest and certainly most demonstrable lemminglike behavior in this business is model proliferation. It’s loosely based on the philosophy that if a car company utilizes its vehicle architectures efficiently to create more models, then the profits will follow and everyone will look like a hero. Except that it doesn’t really work that way.
The most strident proponents of the model proliferation philosophy are the German luxury auto manufacturers. There’s no question that they’re the OGs of this movement. They exist in a world of their own making that revolves around the credo that if model proliferation is a good thing, then even more model proliferation is an even better thing. The explosion of models from Audi, BMW and Mercedes-Benz started to go off the rails about a decade ago, when they decided en masse to not only attack the SUV market while churning out even more variations of their coupes and sedans, but they then added performance variations to everything, whether they deserved it or not. All of this was fueled, of course, by the fact that the German luxury competitors have spent the better part of the last decade jumping at the slightest whiff of a rumor of a new product from one of their competitors to come up with an answer to that product of their own.
This is about the time we started seeing BMW doing homely “GT” versions of some of their sedans and countless versions of their “X” vehicles. And Mercedes and Audi launching product answers of their own that ended up stepping on each other within their own showrooms to a shocking degree. Do you even remember when BMW was just about the 3, 5, 7 and 8 Series? Or when Mercedes-Benz was about the C-, E- and S-Class? Or Audi was about the A4, A6 and A8? It barely registers on the memory meter now. (Just an FYI, right now BMW offers the following models: X1, X2, X3, X4, X5, X6, X7; 2, 3, 4, 5, 6, 7, 8, Z4, M Models, i3 and i8. And that doesn’t even begin to cover the variations of each of those models).
And now, after chasing niche after niche – both real and imagined – the German auto manufacturers have come up for air to realize that they just can’t do it anymore. In the last few months the buzz across this business has been about cutting the number of models offered while reducing complexity. Coming up with all of these niche vehicles is one thing, but supporting them properly with marketing, advertising and dealer training is quite another. It has added costs upon costs, and the whole thing is about to come undone because with all of these companies investing billions in BEVs and other advanced driving technologies, they simply can’t afford to do it anymore. And the aforementioned German manufacturers aren’t alone, either, because Toyota, Honda and VW have launched similar initiatives.
But this is much more than the manufacturers wanting to reduce their own, self-induced internal chaos. It’s about the fact that the confusion for consumers in vehicle showrooms – as well as prices – have been escalating to an untenable level. It’s nice to have options when car shopping, of course, but when variations upon variations are offered – with subtle model differentiations on top of subtle model differentiations added for barely discernible effect – it doesn’t add to consumer confidence by any stretch. In fact, it creates just the opposite, turning off people by making their decisions wildly complicated and needlessly difficult.
To me the end of model proliferation for model proliferation’s sake is a very big deal. It has been such a part of this circus for so long that for the industry to now walk back from it is a measure of just how much the industry is in the throes of definitive change.
We’re not talking about a few wispy clouds in the industry’s coffee these days. No, these churning, 70,000-foot thunderheads are ready to unleash their fury on this business for decades to come.
Detroit. In the aftermath of the Carlos Ghosn rousting, it’s clear that the issues at Nissan run deeper than the fact that the Japanese executives just wanted to rid the company of its aggressively abrasive, megalomaniac of a CEO.
No matter where you come down on the side of the Ghosn situation, he was, after all, a distinguished graduate of Unctuous Prick University and an abusive dictator who lorded over his charges with impunity. But let’s not forget, the so-called Nissan executive management team at the time went along with his outsized demands and relentless goal-setting while approving his expenses because let’s face it, they didn’t have the first clue how to project a better idea or the backbone to do it. Until they apparently decided that they couldn’t put up with his runaway ego one more day.
But leaving that aside – I am not going to list the roster of the Japanese executives at the company who have distinguished themselves with serial incompetence – the fact remains that without Ghosn, Nissan is rumbling, bumbling and stumbling its way to a dark place.
It’s no secret that in many previous columns I have been less than flattering with the way Nissan has gone about its business here. The Nissan product cadence has been a recurring joke and its design executions have been repeatedly cringeworthy, but that’s only the beginning. Its marketing strategy basically revolves around laying massive incentives on the hood and turning out mediocre products to fill its dealer lots so that the “churn and burn” can continue. And when an automobile company conducts business this way it’s inevitable that it will lead to trouble. Needless to say, it has hurt the brand tremendously.
In my Brand Image Meter column last June, I had the following to say about Nissan:
“Nissan marketing is a dismal exercise in futility, and that’s on a good day. So, what is it, exactly? The only rational reason – and I am paraphrasing a hoary adage by H. L. Mencken here – is that no one ever went broke underestimating the intelligence of the American public. As in, mediocrity, when it comes to automobiles, is bliss for most consumers, because at the end of the day too many of them don’t understand the difference and couldn't be bothered to care. Confounding and tragic, but there you have it. And despite Carlos Ghosn’s promises of global dominance, nothing has changed to alter my assessment. (Can’t auto CEOs just be content with doing well without veering into talk about dominating the market? Ha! What was I thinking?) For those who revel in abject mediocrity, Nissan is just the ticket.”
Not exactly a rousing endorsement, but it’s much deserved. Nissan is one of those car companies that has evolved into a Twilight Zone of irrelevancy. The brand’s claim to fame only extends to the fact that it is present and accounted for in the market, and if that’s not enough to dilute its image, the brand takes it one further by jamming rental car fleets and exposing its relentless mediocrity to a wider, dismissive audience.
This just in: This simply isn’t sustainable. And everything I see coming out of Japan is that Nissan executive leadership is in such turmoil that they’re unable to lead their way out of this quagmire, with or without merger partners.
But there’s a Bigger Picture to Nissan’s chaotic situation too. It speaks eloquently as to the basic fragility of this business. Nissan has been able to muddle along for a long time with its “churn-and-burn” strategy, perpetuating its mediocrity year after year to a faction of the consumer public that has reduced expectations when it comes to transportation. But it’s clear that this shallow strategy is running out of steam, and time.
There are no givens in this business and there are fewer guarantees. An auto company can be rolling strong for years to the point that it becomes an assumption – internally and externally – that it will go on forever. But those are dangerous assumptions.
Take Audi for instance. It has been piling up sales records with what looked like an unstoppable momentum. But guess what? Audi is now in the throes of big-time trouble. Its sales have slipped almost nine percent in the first four months of the year, and it’s caused, according to Audi, by a mismanaged product supply to the U.S. due to emissions testing requirements in Europe. Which means its hottest selling Q3 model is out of stock, with the new one not hitting dealerships until late this year. That’s a heaping, steaming bowl of Not Good, because even Audi loyalists are wondering off to competitive brands. Just ask Audi dealers.
But that’s not all that’s going on with Audi, and it is part of the general malaise going on in the market too. As I’ve said repeatedly in the last few months, affordability has become a serious issue. Prices are just too high, and even luxury-oriented buyers are giving pause. And the manufacturers aren’t blameless in this, far from it, in fact. Look at the softening in Jeep sales. I’ve heard all of the excuses, but the fact remains that FCA has gotten seriously greedy with its pricing – particularly with its Jeep options – and people are beginning to get the fact that Jeeps aren’t nearly the value that they once were. Those are self-inflicted wounds that this business has been long famous for, which points to the fact that there’s nothing really new under the sun, especially when it comes to short-term thinking and flat-out greed.
Back to Nissan. If Nissan’s Japanese executives actually believe they can extricate the company from this mess in a short period of time, they are sadly misguided. Because of product cadence, poor product execution and a vacuous marketing strategy, it will take the better part of a decade for Nissan to get back on track. Suffice to say, Nissan’s continued presence in this market is not guaranteed by any stretch.
In fact, I wouldn’t be surprised if the company is merged or absorbed, because it’s clear that Nissan’s Japanese executives spend most of their time searching for a clue. And in a business that runs on “what have you done for us lately?”, that’s just not going to cut it.