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Friday, December 28, 2007
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LATE & BREAKING NEWS
CHINA AUTO SYSTEMS LOOKS TO INCREASE STAKE IN HENGLONG: China Automotive Systems Inc., a Chinese supplier of steering wheel products, says it wants to increase its stake in Henglong Automotive Parts Co. from the current 44.5 percent to 81 percent. The deal could close in the first quarter of 2008, China Automotive said today in a statement. The companies have started negotiations, but no agreement has been made.
Automotive News, December 26, 2007
TOYOTA PLAN KEEPS HEAT ON GM: Toyota Motor Corp. has outlined ambitious sales targets for 2008 that if achieved could propel the Japanese automaker ahead of General Motors Corp., the world's No. 1 automaker for 76 years. Toyota said in a brief statement Tuesday that it planned to produce 9.95 million cars and trucks in 2008 and expected to sell 9.85 million, a 5 percent increase over this year's sales, estimated at 9.36 million vehicles. GM sold 9.1 million cars and trucks last year, a 1 percent decline from 2005, and has not forecast sales for this year or next.
The Detroit News, December 26, 2007
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Scott Ernst
Vice President and Chief Client Officer
Compete
sernst@compete.com
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Scott is Compete's Chief Client Officer and has management oversight, strategic direction and P&L responsibility for the company's vertical businesses including the Automotive, Financial Services, Travel and Telecommunications & Media practices. Prior to joining Compete, Mr. Ernst served as Vice President of Sales, Corporate and Business Development for Personify, a web analytics and behavioral profiling software company. Previously, Scott was Vice President of Sales at AdKnowledge, a marketing software and interactive media management firm, which was later acquired by CMGI/Engage.
1. Tell us about Compete, what you do there as Chief Client Officer and how Compete is working with the industry?
Compete helps some of the world's top brands improve their marketing based upon the consumer behavior of millions of consumers. Specifically, in the automotive market, we've built a series of products and services to help our clients better understand how in-market consumers are researching and shopping for vehicles across a combination of OEM, third party, and dealer websites.
As Chief Client Officer I oversee our vertical business, which is a combination of our automotive, financial services, telecommunications & media and travel practices.
2. The application of what you are doing is intriguing in that you have been able to take basic market research and integrate it into interactive marketing. Can you talk about that a little bit and how Compete has been able to position itself in the industry in contrast to what Polk and other market research companies are doing?
In short, Compete quantifies buyer behavior and enables clients to understand lower funnel automotive consumer shopping activity – between 30 to 90 days prior to a vehicle purchase. Through this process, we help our clients identify demand as it is happening, which is a unique selling point because understanding consumer demand ultimately enables marketers to gain some perspective on what will happen with sales. With this data, our marketing clients can immediately start making different decisions about advertising and incentives, ultimately driving business performance. In most cases, that performance translates into selling cars.
3. How do you know people are in this lower funnel?
The Internet is the perfect listening device. One example of how we identify lower funnel behavior is to observe how consumers behave across the top 30 third-party automotive sites, which are ideal places to observe unencumbered cross shopping. Compete examines how consumers interact across these sites and then correlates that behavior to individual transactions using our proprietary analytical framework. Essentially, consumers’ actual behavior tells us when they’re in the lower funnel.
4. Then you feed that back to the manufacturers?
Exactly. Currently, Compete’s clients are automotive manufacturers. We help them understand the right combination of advertising and incentives to sell their target number of vehicles. The neat thing is, using our insights, manufacturers can now improve marketing performance and better manipulate the advertising and incentive mix to achieve their business goals.
5. What is it that has really given Compete the edge with its competition?
In the automotive market, Compete’s edge comes through focusing on the lower funnel. In addition, we have a database of millions of consumers that we track everyday across the Internet. Simply put, Compete is the best company in the market when it comes to interpreting and understanding consumer click stream behavior to help clients make better marketing decisions.
6. Do you see two or three or four capabilities coming together? For example, we have Tacoda and others and behavioral targeting, we have Autobytel and Cars.com gathering leads and here you are doing all this analysis. It is very likely that the people you are touching and the people in that funnel are also being monitored in other markets. Do you see this all coming together?
Yes. We recently announced an exciting partnership with J.D Power and Associates. In fact, it’s the first time anyone has attempted to link J.D. Power PIN data with actual consumer behavior data gathered online. Although the partnership is in its early stages, we’ve already started adding value by linking transaction data to click stream behavior of consumers. Through this process, we were able to match actual vehicle purchases with behavioral data and there are tremendous applications for this. Marketers will be able to see what consumers do prior to the point of purchase and really understand the actual behavior of consumers that ultimately purchase a vehicle. This is really exciting for Compete, J.D. Power and manufacturers.
7. It seems like this funnel model has become really the predominant automotive sales distribution process. Is that the case? Is the funnel that important?
At Compete, we see the funnel as a way to think about consumer behavior – it’s not necessarily a linear model. Instead, it’s a conceptual notion that allows us to think about the right kind of message to present to the consumer at the right time. The funnel model is further validated in that it’s not unique to automotive. We see similar use of the funnel in the financial services, telecom and travel space. In the automotive market today, there’s a lot of interesting work being done to quantify the difference in the upper funnel and the lower funnel behavior. To me, this process seems to be more sophisticated and developed in the automotive market when compared to some of the other verticals where we work.
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| SIGNIFICANT NEWS |
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News digested: 12/17/2007 -- 12/21/2007 |
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Auto Loan Rates this Week - Overnight Averages* |
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36-month, 48-month new vehicle car loan rates and 36-month used car loan rate charts are available at http://www.bankrate.com/brm/rate/auto_home.asp?link=5
* To see the definition of overnight averages go to http://www.bankrate.com/brm/publ/average.asp
Source: Bankrate.com
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Industry Conferences Coming Up |
2008 International CES
Las Vegas, NV, January 7 - January 10, 2008
2008 Silicon Valley International Auto Show
San Jose, CA, January 10 - January 13, 2008
World's Greatest Collector Car Event
Scottsdale, AZ, January 12 - January 20, 2008
Visit Calendar of Industry Events for More Information on These Events
http://www.automotivedigest.com/calendar.asp?mod=calendar
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Press Releases Worthy of Read |
This Week's FEATURED Industry Press Releases
Click here for more Industry Press Releases!
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People Going Places |
| WHO: | Thomas Gilman |  |
| WHERE: | Chrysler Financial |
| WHAT: | Chrysler Financial has named Thomas Gilman as Executive Vice Chairman. He was previously Senior Vice President and Chief Financial Officer for Asbury Automotive Group and President of CEO Solutions LLC. In his new role, Gilman will be responsible for providing strategic direction for all Chrysler Financial operations, finance and risk management activities. |
| | READ ABOUT MORE PEOPLE! |
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What Industry Leaders are Saying |
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EPA Denies CA Waiver to Implement Tougher Emissions Regs:
- "The energy bill does not reflect a vision, beyond 2020, to address climate change, while California's vehicle-greenhouse-gas standards are part of a carefully designed, comprehensive program to fight climate change through 2050." -- Press release, Office of California Governor
Sourced From: Wall Street Journal, December 20, 2007
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Elite Wheels Vehicle Reviews |
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2008 Chevy Silverado Stands Out as a Segment Star
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| 1) House Speaker Calls New CAFE Rules a Holiday Gift to Consumers |
Situation
- House Speaker Nancy Pelosi (D-CA) says new CAFE rules are win for American people
- Says higher pump prices, Democratic takeover of Congress made change possible
- Says polls show 82% of Americans endorse higher fuel economy standards
- Public pressure helped ensure passage of energy bill
- But MI lawmakers forced concessions for automakers
- Kept 2-fleet rule, credits for building vehicles that can run on alternative fuels
| _NCDs.jpg) Nancy Pelosi (D-CA) |
Significant Points
- Pelosi said fuel economy increase was signature issue as speaker
- Says initial vote on tougher Senate measure softened opposition in House
- Worked w/ auto industry ally John Dingell (D-MI) to craft compromise
- Dingell dropped demand for consistent requirements by federal agencies
- Kept some automaker credits, separate fuel economy standards for cars, light trucks
- Dingell claims concessions won prevented "disaster" for automakers
Read Quotes
Click Here for Full Digest and Source Article:
Sourced From: Detroit News, December 20, 2007
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| 2) Hybrid SUVs Optimize Either MPG or Power and Towing Capacity |
Situation
- Hybrid SUVs make trade-offs between towing capacity, mpg
- Cost $3-10K more than gasoline-only counterparts
|  2008 Ford Escape |
Significant Points
- 2008 Chevy Tahoe hybrid maintains power, towing of 6K lbs, only gets 22 mpg
- V8 disables 4-cyl on highway, can run on electric power only
- Revamped 2008 Ford Escape SUV hybrid most fuel efficient SUV w/ estimated 34 mpg
- Towing limit for 4 cyl hybrid is 1K lbs vs 3K lbs for 6 cyl gasoline-only version
Click Here for Full Digest and Source Article:
Sourced From: RV Trade Digest, December 18, 2007
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| 3) Smart ForTwo: More Than a Fad Predicts Zetsche |
Situation
- Daimler CEO Dieter Zetsche: US demand for Smart ForTwo will exceed supply in 1st year
- Says consumers want fun, safe, economical, low-emissions car that is easy to park
- Says Daimler looking to partner w/ US city to test all-electric Smart car
- Suggests Smart diesel will come to US as well
- Projects Smart subsidiary to be profitable in 2008, declined to forecast sales
|  Dieter Zetsche |
Significant Points
- In Washington visit, Zetsche spoke to US Chamber of Commerce, met w/ White House officials
- Smart USA distributing Smart ForTwos, will open 50 dealerships for launch
- Expect 65 US dealerships by end 1st Q, 74 by end 2008
- US is 37th country where Smart cars sold; over 770K Smart vehicles sold in 10 years
Click Here for Full Digest and Source Article:
Sourced From: Automotive News, December 17, 2007
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| 4) EPA Denies CA Waiver to Implement Tougher Emissions Regs |
Situation
- EPA blocked CA from implementing CO2 regs stricter than those of federal government
- Sets up clash between Administrator Stephen Johnson, Governor Arnold Schwarzenegger
- Bush signed energy bill same day; biggest fuel efficiency increases in 30 years
- Energy bill sets 35 mpg standard for new cars by 2020
- EPA, other agencies under Supreme Court ruling to control CO2 emissions as pollutant
- Improving fuel efficiency only effective means to reduce CO2 emissions in IC engines
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Significant Points
- Energy bill may curtail efforts at 4 federal agencies to address CO2 emissions from passenger vehicles
- Actions unlikely to impede efforts of 17 states seeking own CO2 limiting standards
- Schwarzenegger said would appeal EPA decision
- Will continue to press for waiver to put CA's standards into practice
- CA rules could end up tougher than federal rules just enacted requiring 44 mpg
Read Quotes
Click Here for Full Digest and Source Article:
Sourced From: Wall Street Journal, December 20, 2007
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| 5) Minivans Fare Poorly in Bumper Tests |
Situation
- Insurance Institute for Highway Safety tests 6 minivan bumpers
- Uses low-speed crash tests to measure damage allowed
- Each vehicle goes through 4 tests: front, rear full impact; front, rear corner
- Despite poor results, minivans outperformed midsize cars
- Bumpers are higher, rear bumpers wider than midsize cars
|  2008 Nissan Quest |
Significant Points
- Nissan Quest was worst performer; sustained $8K in damage
- None of 6 minivans tests resulted in less than $5K damage
- All but Chevy Uplander required tailgate replacement in full rear test
- Honda Odyssey best overall; Dodge Caravan best single test, $483 for rear corner
- Not all replacement parts cost same; nor is replacement complexity
Read Quotes
Click Here for Full Digest and Source Article:
Sourced From: IIHS News Release, December 20, 2007
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| 6) Car Stories of the Year |
Situation
- GM had some success this year, w/ new 2008 Chevy Malibu, Cadillac CTS, Buick Enclave
- Audi and Rolls-Royce scored w/ their R8 and Drophead Coupe vehicles, respectively
- Chrysler had rough year, and got rid of Pacifica, Crossfire, convertible PT Cruiser and Dodge Magnum
- Toyota Tundra showed that not all big trucks are out of favor
- Cars, crossovers were preferred this year over SUVs, big trucks
|  2008 Cadillac CTS |
Significant Points
- Ford brought back the Taurus this year, after killing it off last year
- Toyota will likely overtake GM as world's #1 automaker in the near future
- GM had plenty of bad news as well, including a staggering $39B net loss for 3rd Q of 2007
- Chevy currently scheming to put well-equipped 2008 Malibus in daily rental car fleets
Click Here for Full Digest and Source Article:
Sourced From: Business Week, December 13, 2007
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