Car News for Consumers: What to Watch in 2011

January 1, 2011/Steve Tackett

MOTOR MATTERS FREEWHEELING BY BILL VISNIC

The automotive press loves to produce end-of-year wrap-up stories on just about everything you can imagine from Car of Year to best-selling paint colors. Rather than look back on what happened in the auto industry in 2010, here are a handful of items we think are the most intriguing car stories to watch in 2011:
— 2011 should be another good year to buy a new vehicle.
Most analysts and industry watchers are expecting only a modest increase in overall auto sales next year — the on-track 11.5 million total new-vehicle sales in 2010 will grow to perhaps 12.5 to 13 million in 2011 — still far less than the 16.5 million-plus the industry routinely pushed through showrooms prior to the recession.
Expect automakers to continue to tempt new-car buyers with generous incentives. And now that prices in the used-car market have firmed, aggressive lease offers also are becoming common again. Add to that the expectation that interest rates will remain near historic lows for much, if not all, of 2011 and it should be another great year to be a new-car buyer.
— Plenty of tempting new models coming.
There’s a veritable bumper crop of interesting and potentially game-changing new vehicles coming this year: Ford’s just-launched 2011 Explorer (an all-new generation of what not long ago was one of the nation’s best-selling vehicles); an all-new midsize sedan from Volkswagen; plus a raft of high-tech and feature-rich new small cars, such as the next generation of Honda’s beloved Civic, the 2011 Hyundai Elantra (already on sale) and Ford’s ultra-sharp Focus that should determine whether Americans are ready to accept smaller and more fuel-efficient vehicles as a high-volume seller.
— Can Hyundai keep success rolling?
Hyundai’s yearned to play in the big leagues, and now it looks like the wish is coming true: Hyundai had record sales in the U.S. in 2010 and topped a half-million total sales for the first time ever.
Hyundai’s Sonata midsize took the market by storm, and backed by a string of well-built and strongly styled other models, including several from sister brand Kia, propelled Hyundai — long a brand wearing the collar of a downmarket image — to the top of many U.S. buyers’ shopping lists. It hasn’t hurt that the Sonata is built in Alabama — and Kia also has a brand-new assembly plant in Georgia.
Now the question will be whether Hyundai and Kia can follow the lightning-in-a-bottle success of its latest products with solid consistency for the long haul. And whether their dealer network can handle radical growth, a critical portion of the business model that in the past has bitten many other quick-growing automakers.

— Will “Green” really sell?
Sure, Nissan’s Leaf electric car and General Motors’ Chevrolet Volt pegged the hype meter as they prepared to hit showrooms at the end of 2010. Both environmentally friendly vehicles were the most anticipated cars of the year and if you didn’t order one a long time ago, you won’t get your hands on one for some time to come.
The fact remains that demand for high-efficiency vehicles has been nominal. Gasoline prices have been low and stable for more than a year and, despite the initial knee-jerk reaction to the giant BP offshore oil spill that had some calling for a quick end to our petroleum-dependent ways, new-car buyers have largely been ambivalent to fuel-saving hybrids and small cars.
There’s been outsized interest in the Leaf and Volt, but unless something changes — another hike in gasoline prices, some other environmental catastrophe or a big government incentive — it looks like the majority of American buyers would rather have crossovers and pickups than electric cars and hybrids. — Bill Visnic, Motor Matters

Copyright, Motor Matters, 2011

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