Archive for April 13th, 2010

How important is technology in your vehicle?

If Ford’s success with the Microsoft-developed SYNC system is any indication, there are quite a few drivers out there who insist on great software to keep them connected while on the road.

The Detroit-based automaker recently celebrated the 2-millionth installation of the system.  The lucky car was a Fusion Hybrid, itself a techno wonder of the fuel economy kind.

SYNC is a voice-controlled entertainment and communications system that can read aloud your text messages, provide turn-by-turn directions, dig through your iPod’s music library to find a song, and do much, much more.  The technology is available in a range of vehicles from the Ford Focus to the Mercury Milan to the Lincoln MKT.

Ford appears to have hit a home run with SYNC.  The automaker brags that 87 percent of owners are satisfied with how the system operates and 88 percent would recommend SYNC to others.

Installations of the system are accelerating, too.  SYNC has been around since 2007 and the 2-million installation came less than a year after hitting the 1-million mark.  Ford points out that the system can in some cases raise the resale value of a vehicle by over $200… further noting that SYNC is quite the bargain when you consider that it only costs $395 to begin with.

More importantly for an automaker on the rebound, SYNC seems to be raising people’s opinion of Ford.  Internal data shows that after receiving a demonstration of the technology, 80 percent of potential customers report that it improved their opinion of the brand.

The success of SYNC is obviously good news for Ford, which is in the midst of a blockbuster recovery that began in late 2006 when CEO Alan Mulally took the helm.  It also signals a sea change in the way that manufacturers integrate technology in their vehicles.

Cars, for all their wondrous complexity, have generally lagged behind the rapid-fire consumer electronics industry.  Automakers used to hide behind the excuse that it was much easier to replace hardware in a climate-controlled house than it was to replace in a vehicle that has to withstand Arizona summers and Wisconsin winters.

But tech-savvy customers, already accustomed to rapid change with their other electronic purchases, were never satisfied with this response.  SYNC largely solves this problem because the tried and tested hardware stays the same while the software can be updated, just like in a laptop or smartphone.  This allows for new features to be added to SYNC down the road, increasing a customer’s satisfaction with the purchase.

If this seems like a painfully obvious upgrade, you’re right.  But SYNC was a pioneer in bringing this update-friendly philosophy to automobiles and it is forcing some long overdue changes in the industry.  For Ford, at least, this is a major win and it’s shining light on some very deserving vehicles.

When Honda announced it would produce a tweener pickup (not quite large like an F-150, bigger than a Tacoma) capable of seating 5 and carrying on all the duties any good DIY (do-it-yourselfer) would want, truck loyalists scoffed. First off, the truck has unibody construction (vs. a ‘heavier’ duty body-on-frame of most trucks) which is (mostly) perceptually inferior than a traditional body-on-frame truck.  And while most people couldn’t tell the difference, it was labeled (unfairly) a car-based truck.  Truth is, car companies can make unibody trucks that are extremely capable.  Second, Honda didn’t have any meaningful history with pickups.  As Toyota learned the hard way, larger pickups are something that takes time to develop as the core buyers are extremely loyal to the domestic brands.  It took Toyota a decade to break 100,000 units and they had a “feeder” system with hundreds of thousands of loyal Tacoma drivers on the road. Third, the competition is fierce.  Ford and Chevy have such an advantage in the marketplace in terms of economies of scale and manufacturing experience.  I mean, why take a risk on a Honda when a cheaper, more proven domestic pickup was actually superior?  Personally, I don’t think the product was wrong in any way, but it wasn’t right for the brand.  One thing is for sure, people who bought them loved them. If you look at the consumer ratings on Honk.com, the Honda Ridgeline scores a A-, which is just about as good as any other pickup in its class.

Overall, the Honda Ridgeline has been a sales flop for Honda.  And while it initially achieved its sales goals of 50k units, the recent sales slump has dragged their sales volume below 20,000 units per year – hardly a sustainable number for Honda.  Of course, Honda did spark a new resurgence in unibody pickup interest.  Kia, GM, and even Ford have all been actively looking into unibody compact pickups, although many have said those programs will now go away. Truth is, the big boys have a grasp of this market and the DIY market has slowly retreated back into the cars they came from. I guess rebuilding your house is not as cool as it was a few years back!

Let me take a quick moment to douse a little 40oz onto the pavement for the Honda Ridgeline.  One good note is that the Honda Ridgeline pricing should be pretty fantastic the last two years of production.  I imagien the prices will start to fall now that the announcement has been made.  Expect many incentives if you want to be the last 40-50K owners of this vehicle.

Let’s take another moment to bow our heads in silence to other unibody pickups that have failed before the Honda Ridgeline…

Jeep Comanche d.1992

VW Rabbit d.1982

Subaru Brat d.2006

Dodge Rampage d.1984

Subaru Brat d.1993

Ford Ranchero d.1979

As the 2009-2010 auto show season comes to a close, a few vehicles stand out from the rest.  One of the most significant reveals was the Cadillac XTS Platinum Concept, a fullsize luxury sedan with striking good lucks and a secret weapon.

Revealed to an enthusiastic audience in Detroit, the XTS is expected to go into production later this year as Cadillac’s new flagship sedan, leading a product renaissance that includes the frisky CTS sports sedan and stylish SRX crossover.  It’s built atop GM’s all-wheel drive “Super Epsilon” platform and will replace the slow-selling DTS and STS sedans.

Besides a gorgeous and very modern interior, the XTS features a big surprise under its aggressive hood.  Instead of a burly V8, there’s an advanced plug-in hybrid system attached to a modest V6 engine.

A flagship sedan with this kind of tree-hugging powertrain begs the question: Is green the new color of high-end luxury?

Most times in the auto industry, advanced technology starts up top with the most expensive luxury vehicles and then trickles its way down to more common cars and trucks.  Hybrids like the Toyota Prius and Ford Fusion bucked that trend, though, and put super high fuel economy within reach of almost anyone.

This time it’s the high-end luxury cars that are playing catch up to the mass market entries.  The XTS will be joining a fairly new group of green super sedans that include the Lexus LS600h, Mercedes S400 Hybrid, and BMW ActiveHybrid 7.  Of this elite group, the Cadillac will be the first to use grid electricity to squeeze more miles from every drop of fuel.

Final numbers on the XTS are still pending but none of the other entries are anywhere near as fuel efficient as a Prius.  Are the hybrid powertrains under their respective hoods worthy of their high price premiums or is this just a case of green-washing?