2013: The year in cars
Christmas arrived on schedule for the U.S. auto industry as a spurt of sales put the wrapping on a surprisingly successful year. Analysts predicted that sales in December could hit a seasonally-adjusted rate of 17 million, which would be the first month at that rate in nearly six years. That would push 2013 sales up to a robust 15.7 million units.
Welcome as they were, surging sales weren’t the biggest news of the year. Detroit celebrated when General Motors (GM) made Mary Barra the auto industry’s first female CEO, then held its breath while Ford (F) CEO Alan Mulally dithered over a move to Seattle and Microsoft. The old Big Three, complaining about straining available production capacity, made plans to expand and hire. Tesla (TSLA) fired up electric car sales and refused to play by industry’s rules, while Google (GOOG) pioneered a car that drives itself.
There were reversals too. Sales of electric vehicles suffered as gas prices leveled off and then fell. Suzuki wound down its presence in the U.S. market, and Volvo looked none too healthy. Sales in China — now the world’s largest auto market — slowed, and Europe remained deep in a slump, its fundamental overcapacity problems unsolved.
Here are some of the year’s pinnacles and potholes:
Busting through the glass ceiling
In being named CEO, Mary Barra broke through several historical barriers in moving from GM’s third-most powerful executive position to its first. Her job was made both easier by the appointment of a non-executive chairman to handle the board of directors, and more difficult by the decision to give her old job to one of her rivals. As the first product engineer to head the company in two decades, she will be deluged with suggestions about everything from air conditioning vents in new pickups to the future of brands like Buick and Chevrolet.
Most popular vehicle
Ford’s F-series pickup, the reigning champion for the last quarter-century, held off a strong challenge from Chevrolet’s redesigned Silverado to remain the nation’s No. 1 selling vehicle. The race to become the best-selling car, an all-Japanese final, belonged again to the Toyota (TM) Camry, which beat out the Honda (HMC) Accord.
Fastest-growing volume brand
Juiced by the redesigned Forester crossover, Subaru saw its sales climb 28%. It broke its previous annual record with two months left and recorded its fifth consecutive yearly increase. Kia, formerly a hot performer, slumped despite seven new or refreshed models. Its sales fell 3% in an overall market that had risen 8% through November, the worst showing for any top 10 brand.
Fastest-growing luxury brand
Jaguar continued its remarkable comeback under the ownership of India’s Tata by pushing its sales up 41%. A burst of activity around the F-type sports car helped, but the real boost came from the revived XF sedan, which added four- and six-cylinder models and all-wheel- drive. Nissan’s Infiniti, now headquartered in Hong Kong and beginning a multi-year turnaround, watched its sales drop 4% after renaming all its models with alpha-numerics beginning with the letter “Q.”
On his way out the door as CEO, Dan Akerson took care of some unfinished business, reversing some old decisions:
- After 82 years in Australia, GM said high costs would halt engine and vehicle production at its Holden subsidiary, leaving Toyota as the last manufacturer on the continent.
- After nine years of selling Korean-made Chevrolets in Europe, Akerson decided 1) the cars weren’t catching on with customers; and 2) were stealing sales from Opel, which needs the business. So GM is stopping sales and will take a charge of up to $1 billion.
- After 14 months of working with Peugeot to save money in purchasing and new model development, GM sold its 7% stage at a loss of $82 million and said the scale of cooperation would be greatly reduced.
Mark my words
In January, Fiat-Chrysler CEO Sergio Marchionne said Alfa Romeo would return to the U.S. in 2013 “for sure.” In September, a Fiat executive told USA Today the car would “definitely arrive by year-end.” Later in the month, a Fiat spokesman said the first car, a lightweight sports car called the 4C, wouldn’t arrive until the second quarter of 2014. Anyone can make mistakes: In May 2011, I wrote that Alfa would be back in the U.S. “later in the year.”
Volkswagen, which is often suspected of having a tin ear when it comes to understanding the U.S. market, announced it is replacing the British executive in charge of sales, Jonathan Browning, with a German, Michael Horn. VW’s U.S. sales slump in 2013, down 5%, was widely forecast because its two core models, the Passat (above) and Jetta, are aging and the new Golf will be two years old before VW gets around introducing it to the U.S. market.
Selfies in executive search
Renault’s chief operating officer at Renault, Carlos Tavares, declared in August that since his boss, Carlos Ghosn, wasn’t going anywhere, he, Tavares, was available for a promotion to run General Motors or Ford. Two weeks later, Tavares resigned his Renault job “to pursue other personal projects.” But in November, Peugeot, Renault’s French rival, announced that Tavares would join the company as CEO in 2014.
Quality is Job 1
In June, Chrysler owned up to legacy design issues when it recalled 2.6 million 1993-2004 Jeep Grand Cherokees and 2002-2007 Liberty models (2007 above) due to a potential fuel-system problem that could cause fires in a rear-end crash. But it was modern-day faults that flummoxed Ford, which recalled the Escape for the seventh time since the popular crossover was redesigned in 2013. One of the seven recalls was to fix problems caused by repairs for a previous recall.
Sorry is the hardest word
In August, Ford apologized for overstating the fuel economy of the C-Max crossover (above) by four miles per gallon and said it would reimburse owners $550 for “good will.” That topped the offer from Hyundai and Kia, which apologized for “procedural errors” that led them to overstate fuel economy in some models by one mile per gallon. The Korean brands said they would reimburse customers for the difference between the actual and stated mileage plus 15% for inconvenience: an average of $88 per owner.
Fisker declared bankruptcy in November after burning through $1.4 billion — one-third of it from the federal government — while selling only about 1,800 copies of the $103,000 Karma plug-in hybrid. Its remains were sold to an investor group headed by a Hong Kong businessman who bought the company for pennies on the dollar. The group plans to resume production of the Karma (above) and other hybrids in the future. Meanwhile Saab, which went bankrupt in 2011 and hasn’t built a car in two years, started up production in December of the old 9-3 sedan under its new owner, National Electric Vehicle Sweden. It plans to make 10 cars a week, mostly for sale in China, home of its 22% owner, the city of Qingdao.