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Hyundai is Awesome. Even Honda Admits It!

Remember when Hyundai was a joke?

When Japanese automakers entered the U.S. market, they changed the very fabric of the American auto industry. The cars they offered were small, inexpensive and quickly built a reputation for reliability that exists to this day.

Toyota, Honda and Nissan happily took market share away from the U.S. automakers and never looked back.

Today though, the Japanese are forced to glance backwards because South Korean automaker Hyundai is storming forward and steadily taking customers away; just as Japanese companies did to the U.S. automakers.

The irony comes full circle with this quote from Honda CEO Takanobu Ito:

Hyundai is awesome. They are undoubtedly a threat because their products are cheap, and the quality is improving.

To say Hyundai’s quality is “improving” is like saying the Pittsburgh Steelers are Super Bowl contenders. Hyundai isn’t improving, the company has improved to the point where I believe it could build a better Honda than Honda does.

Toyota’s chief even went so far as to say that his company is “grasping for salvation” and is in the final stages of corporate decline.

While that may be a bit of an exaggeration, Nissan’s senior vice-president Shiro Nakamura compared the whole situation to food by saying,

We have to offer the equivalents of sushi, tempura and kaiseki to compete against Korean barbecue.

I think what he was trying say, in a really weird way, is that Japanese automakers need to find a way to make sure consumers see the value in paying more for Japanese cars. I’m not sure that’s a winning proposition, as this Great Recession will only motivate more buyers to look for long-term value and reliability.

That’s an equation Hyundai has a very firm grasp on.

Will Hyundai continue its rise and overcome Japanese automakers? I think Mazda and Nissan are more at-risk than Toyota or Honda, but what do you think?

-tgriffith

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The Most Exciting Cars of 2010: Camaro? Mustang? Nope!

Is this wagon exciting?

What’s the most exciting car of 2010?

Nope. According to TIME Magazine, the Koreans nabbed the two most exciting cars of ‘10, with the number 1 spot going to the Kia Soul.

While I, and certainly many others, have an issue with calling the Soul “exciting,” I won’t argue that it isn’t cool. For me, calling a car exciting means thrilling driving dynamics, agile cornering, and a completely unnecessary amount of horsepower.

Not tween-inspired styling and clever interior lighting.

TIME’s number 2 pick is closer to my definition: the ‘10 Hyundai Genesis Coupe. A rear-wheel-drive, 300-hp V6-powered coupe certainly qualifies to appear on anyone’s list of exciting cars, especially considering its $25,500 price tag.

Rounding out the Top 3 is the Ford Taurus SHO, a car our own jgoods certainly didn’t like that much. If they could shave off some of its 4,368 pounds of weight, maybe that 365-hp V6 would feel way more exciting than it does.

And how’s this as a sign of the times? A station wagon also made the list. Granted, it’s the Cadillac CTS Sport Wagon, but still, it’s a station wagon that someone labeled “exciting.” We’ve come a long way since the ’70s, man. I guess 26 mpg on the highway from a V6 engine is exciting, just not in a pedal-to-the-metal kind of way.

Other cars that made the list include the Jeep Grand Cherokee (enter your own joke here), Toyota Venza, Suzuki Kizashi, VW Golf, and Mercedes E-Class. Only one car they picked genuinely fits the bill: the Nissan 370Z.

All of these are cool cars and worthy of consideration when car shopping… but I’ll bet CarGurus blog readers can come up with a list of 2010 cars that truly excite.

So let’s hear it: What are the most exciting cars of 2010?

-tgriffith

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Convertibles, V8 Ultra-Muscle and Hot Hatches… Oh My!

Audi RS3 rendering

Whoa, baby, we’ve got some cool cars coming to America!

What do you like: convertible muscle cars? You’re covered. A little more horsepower for your Challenger? Check. A small hatch that is affordable and still fun to drive? It can be yours. What about a 340-hp hatchback that’ll scoot to 60 mph in 4.5 seconds? We can only hope.

camaro_convertible Chevrolet is readying the popular Camaro with a rag top, according to the boys over at Autoblog. Check out this picture of a group of fresh-off-the-line convertibles sitting at the Holden plant in Australia. Anyone up for buying a 2011 convertible Camaro? Even in the silver/tan color scheme?

Owners of ‘08 or ‘09 Dodge Challengers now have an option of upgrading to the Classic Design Concepts Group 2 Challenger, a series of options that can raise the horsepower to a stellar 560. Also available are 12.5-inch-wide rear tires, Baer brakes, lowering springs, a custom hood, and more. The full upgrade can bring the cost of an SRT Challenger to over $79K, putting it close to Viper territory. Still though, at that price, it’s dang-near worth it.

suzuki-sx4-sportback Looking for something much less expensive but still fairly fun to drive? Suzuki hopes to catch your eye with the 2010 SX4 Sportback. Looking nearly identical to the SX4 Crossover at first glance, the Sportback sits lower to the ground, has 17″ wheels and tires, isn’t offered in AWD, and lacks roof rails. And it has only 410 fewer horsepower than that Group 2 Challenger.

But a six-speed manual tranny, performance shocks, and anti-roll bars should help the SX4 Sportback provide a fun drive while getting 30 miles per gallon. In my mind, the SX4 Crossover and Sportback are further proof that Suzuki is ready to seriously take on the U.S. market.

Finally, we’re nearly beyond words at the thought of the new Audi RS3 (pictured at the top of this story) hitting America. Granted, the odds aren’t great that we’ll see it here, but it’s not out of the question. So for now we can drool over these numbers provided by the good folks at Leftlane:

At the heart of the RS3 will be an Audi TT RS-sourced 2.5-liter five-cylinder turbocharged engine. Tuned to produce 340 horsepower and 332 lb-ft of torque, the RS3 should be able to easily scoot from 0-60 in about 4.5 seconds, with the electronic nannies kicking in at about 155 mph.

We’ll keep an eye on next month’s Frankfurt Motor Show, where Audi should release more info and prices.

Are there any new car debuts you’re eager to see?

-tgriffith

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Max Caves, Formula One Teams Win

Well, sort of. In fact FOTA (Formula One Teams Association) and FIA, the sport’s governing body, do need each other, and the tradeoff the teams got was having Max Mosley, FIA president, agree not to run for reelection in October as Supreme Leader. That will be a result very much to the good of the sport and its fans.

Edward Gorman of the Times Online put it well:

The reign of Max Mosley as ruler—for that is what he was—of world motorsport and Formula One has come to an end. Like all men who enjoy almost unfettered power, there was always a danger he would over-reach himself and that, in the end, has been the case with Mosley.

After constant battles with the teams and the recent imposition of a “voluntary” budget cap, the teams had had enough. Thus the split we reported. Nobody trusted the guy. Still, the sport needs a governing body, and it became apparent that the teams recognized this. If they split off from FIA, how would they organize themselves and pursue a viable 2010 season?

So, as one wag put it in the comments section of the Jalopnik story, “It means only that he’ll have a lot more time for Nazi orgies.” In the end, money talks, and the FIA controls a great wad of it.

Now, when and how are they going to get rid of Bernie Ecclestone, the other half of this dynamic duo?

—jgoods

A New GM Division?

Here’s another brilliant idea I came up with in the shower, incubator of my genius.

GM has obviously had some recent success with its new high-powered specialty and sports cars: the Corvette (Grand Sport, above), the Cadillac CTS-V (below left), the Camaro (below right), and the Pontiac G8. We’ve given them great reviews, as have others in the automotive press. The public likes them: Witness the 18,000 Camaro orders tgriffith recently wrote about. This could be a strong niche market at several price points.

Yet bankruptcy will likely doom them all (except for the Corvette, says GM). It’s ironic and unfair that these are some of the best cars the company has ever built. But somebody, somewhere is going to buy the tooling and technology from GM to keep building them.

Here’s my idea: GM should keep building them—in a new specialty division dedicated to producing affordable performance cars for buyers who can and will pay the freight. There are many people still in the market with cash to spend who will buy such cars, notwithstanding the tremendous social, political, and economic pressures to go small, green, and efficient. By the way, the Camaro trim with a V6 gets 29 mpg.

Besides, the American market is never going to accept the overpriced Volt or the Korean-built Cruze. If GM bets the farm on these, it can’t survive. A sport specialty division could at least help fill the gap until better fuel-efficient small cars that people want come to market.

There would be production synergies, since Corvette engines power the CTS-V and one version of the Camaro. Some parts and platforms could interchange. One or two assembly plants could produce all these cars, keeping at least some GM folks working. Setting up dedicated dealerships would stanch some of the bleeding from that wound. Mileage improvements, per the new Obama proposal, would apply to these cars as well.

My idea won’t rescue GM, but may keep it breathing a while longer while the company comes back to life. People clearly want to buy these cars, and they should have the opportunity to keep doing so. If they won’t eat multi-grain bread, let ‘em eat cake.

Do you think there is a viable market for these cars that would help GM stay alive?

—jgoods

Fiat Is Still Hungry

We hear that Sergio Marchionne has started talks with GM to buy Opel—and most of GM’s European operations. The Fiat CEO has some appetite. Without so much as a burp after digesting Chrysler last week, he pulls up to another table for what could be an even bigger meal.

If he gets GM and the German government to agree, the deal would give Fiat another new car company, including Chrysler, Opel, and Vauxhall (U.K.), potentially generating some $105 billion per year. Marchionne believes consolidation is inevitable in the car industry and an individual firm can’t be viable unless it produces around 5 million units a year. The GM deal would give Fiat at least a 5.5 million car capacity, and maybe as much as 7 million.

The Fiat-Chrysler-Opel alliance actually makes some sense. GM must find a partner to run Opel (whose Insignia we praised) by June 1 or bankruptcy looms. While it has other suitors, the synergy with Fiat would be better, and it’s a great fit for the latter.

There are lots of problems, however, not least of which is present overcapacity (estimated by the unions to be 1 million vehicles). There will be big debt for the new company—some 20 billion euros if the deal goes through. And then there’s the small matter of convincing the German government to kick in 3.3 billion euros to (maybe) guarantee investor loans to finance the acquisition. Fiat will likely need to terminate thousands of Opel jobs in a bad recession, no easy prospect for the government to face, as the European economy is expected to grow still worse.

So maybe Sig. Marchionne is biting off more than he can chew. It’s always fascinating to watch an overreacher, even at the dinner table.

As my mother used to say, “pigs is pigs.”

Tell us what you think would be the good things about a Fiat-Chrysler-GM combination. What kinds of cars would we get?

—jgoods

Electricity and Incest at the Detroit Show

The first news out of the Detroit Auto Show was to downplay expectations: Major firms weren’t coming; the new cars weren’t exceptional; it was a very tough year. And then things got quite green all of a sudden with the media crowing over electric cars (really hybrids with gas engines doing the battery recharging).

Lotus Evora

The idea of high-end electric cars (and most of them will be quite expensive) seems to have charmed the pants off everyone. And the sports cars generated the most comment.

The notion of driving a sophisticated batt-mobile with real performance has turned on a lot of people. Perhaps they want a quick escape from the bad financial news at the office.

Tesla, of course, has gotten terrific reviews and presold about 1,200 roadsters at $109,000 per. But it’s got money troubles and is reported to be suing competitor Fisker, whose new 4-door Karma was one of the hits of the show (a roadster is coming). The smart money seems to be on Fisker, which is getting some funding from Qatar and making an international push with their cars. Tesla developed its car jointly with Lotus of England, which is in bed with more than one carmaker.

Cadillac Converj

To me, however, the really interesting electrics are still concept cars, some of which, like Cadillac’s Converj, I hope will get built. It is designed around the same power package that the Chevrolet Volt will be using: The first 40 miles are on the batteries, then the gas engine recharges them to permit “several hundred” more driving miles in hybrid mode.

Chevrolet Volt

Like the Volt, it has a plug-in, overnight recharger. Unlike the Volt, it’s a beautiful exercise in design, executed by Simon Cox in England. As they used to tell us in the car biz, styling sells cars. If they can do this one for less than $100K, they’ll have a winner.

Maybe Chrysler will too, but who knows when? Its Dodge Circuit EV, a true electric, promises 150-200 miles between charges, zero emissions, and 0-60 mph in under 5 seconds. Though the name Charger was apparently taken, the Circuit’s origins are in the earlier Dodge EV roadster and the Lotus Europa, to which it owes big styling and engineering debts. Chrysler is being very coy about price and production. I think they may be using the Circuit to “get someone to dance” with them, as Sen. Corker put it in the bailout hearings.

Dodge Circuit EV

To reinforce the incestuous nature of this business, Lotus is working, possibly with Toyota, on its own EV car, as yet unnamed but perhaps to be styled like the Evora on display in Detroit. Likely competition will be the Tesla roadster and . . . the Dodge EV.

I do hope these folks don’t trip themselves up over all their “alliances.”

OK, let’s vote: Which of these cars would you like to have?

—jgoods

Imaginary Management at GM

It’s kind of like driving drunk: You think you’re doing just fine, and bam, you’re pulled over (or you hit the wall). From everything I know, GM leadership has been so insulated, so obtuse, so drunk, if you will, that they finally hit the brick wall. And like any good drunk, they denied everything and refused the breathalyzer test.

Here’s why they got bailed out without having to spend even one night in jail:

In April 2008, General Motors ranked as the world’s ninth-largest public company [my emphasis] by revenue, according to the Forbes Global 2000 list. GM’s revenues outpaced every company in the world except for eight, and every car company in the world save Toyota. Yet, GM finished at #573 in the overall rankings. And for the same year, GM lost a net of nearly $40 billion—ranking dead last among the world’s public companies. From this cursory view, it would appear that GM’s products are selling just fine—second-place in its industry, and 9th across all industries—and instead that GM’s troubles run deeper than just products.

In this piece, Forrester researcher Chris Townsend points out the lack of systemic innovation behind GM’s fall. Well, sure, we all can recognize that. But what is it about the company’s failed management that stifled innovation and produced its “fortress mentality”? When its market stopped expanding in the early ‘70s, why did it fail to adjust? Why did it continue drinking the same old booze?

Bob Sutton, a researcher who has studied GM over the years, has some answers. They reveal a management out of touch with its competition, with its employees, with its customers, and with its market. These are people who imagined they were doing their jobs while the world changed around them.

Foremost in Sutton’s indictment is the top-down, kiss-ass culture at GM:

The norm in meetings is that the highest status person in the room does all or most of the talking. Plus, more so than any organization I have ever dealt with, employees are expected to express agreement with their bosses. Why didn’t anyone have the guts to tell the executives that taking a private plane to beg for a bailout was a bad idea? I suspect that it is just standard operating procedure: GM is a culture where subordinates are expected to shut-up and kiss-up when the boss is around.

Also, managers get cars as perks (some with drivers), but their cars are handpicked off the line, and the system sees to it that maintenance is taken care of. Naturally, these folks don’t go through the arduous process of dealing with dealers for shopping, purchase, service, or sale of a car. In other words, they are totally insulated from the realities of car ownership. Nor do they EVER drive a competitor’s car.

Thus, GM people are managing in a bubble, in a woozy dreamworld where they become victims rather than actors, where no one steps up to the plate, where the answer is usually “no, we can’t” when innovations are suggested.

The fact is that their bankruptcy has been going on for years. Sutton says that GM’s failure makes him sick: “I saw the pain that people were experiencing in Flint in the early 1980s, the depressed workers and former managers, the ripple effects on businesses, and the helplessness. It is all much worse now. I don’t know if the U.S. auto industry can be saved.”

None of us knows. But we do know that the binge is over. When a DUI behaves this badly, you take away his license.

Fire all top levels of GM management: Yes or No? Leave us your comment.

–jgoods

Last Cars Reviews Blog

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