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Mazda Premium Strategy to Surprise Competitors

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Mazda Premium is the objective for the Mazda brand in the future.  Mazda realizes it is a mainstream brand but wants to become premium.  In the minds of the car buyer, Mazda competes with Toyota, Honda and Nissan.  Mazda has limited resources and needs to husband them.  To achieve Mazda Premium positioning, its products must be executed to meet or beat premium brand competitors.  This requires targeted benchmarking against more expensive vehicles in the same product category.

CX-5 Latest Mazda Premium Vehicle  At the press launch of the 2017 Mazda CX-5 mid-size crossover SUV (XSUV) in San Diego, Mazda detailed its competitive strategy.  The Mazda product development team did not closely benchmark the usual suspects.  The CX-5 will be sold against Honda CR-V, Toyota RAV4, Hyundai Tucson and Kia Sportage.  To go against premium brands, the CX-5 team benchmarked luxury brand XSUVs like Audi Q3, BMW X1, Lexus NX, Mercedes GLA.  To show how deep they have benchmarked premium XSUVs, the Jaguar F-Pace was even included on one comparison chart.

The new Mazda CX-5 is a 5-passenger XSUV slotted below the 7-passenger CX-9 introduced last year.  The CX-5 completes Mazda’s evolution to its Kudo design theme that stresses the “soul of motion”.  The styling is striking and clearly differentiated from its German and Japanese competitors.  Mazda states that “every element has been designed to be in a class above”.

To demonstrate the superiority of the premium-designed CX-5 over its luxury competition, Mazda provided these premium vehicles as comparisons to drive through downtown San Diego.  While we cannot yet discuss the driving experience, we can reveal that the CX-5 arguably looks and drives better than premium brand XSUVs costing about $10,000 more.

In reality, it will take years for Mazda to achieve premium brand status.  Executed consistently and effectively, Mazda Premium will ultimately achieve a stronger image with Mazda dealers and customers.  Mazda Premium will allow Mazda to achieve higher per-unit profitability.  Ultimately, Mazda Premium will allow Mazda to be positioned at a premium brand like Acura or Buick if all goes as planned.  Competing against Audi, BMW, Lexus, Jaguar and Mercedes is still a ways off.


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Genesis G90 – Genesis Flagship – Worthy Premium Luxury Competitor?

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2017 Genesis G90 F34 VVThe Genesis G90 is the flagship of the new Genesis lineup.  It will be on the market in September, 2016.  Genesis is positioning the G90 against the top-of-the line Mercedes-Benz, BMW and Lexus sedans.  The question is can it compete?

Size is Competitive with Lexus, Mercedes, BMW  From a size perspective, the Genesis G90 is within inches of its competitors.  It is a bit bigger than the Lexus LS460.  It is about the same size as the Lexus LS460L, however.  That is the extended length LS.  It is a couple of inches shy in wheelbase and overall length to the BMW 7-Series.  It is a couple of inches shorter than the Mercedes S-Class.  Its interior volume is a bit bigger than the S-Class.  Let’s call it a toss up when looking at size.

Powertrain Choices – Base V6 TT with Optional V8  The base Genesis G90 powertrain is a 3.3L Twin-Turbo GDI (gasoline direct injected) V6 with 365 horsepower and 376 lb.ft. of torque.  About 80% of G90 volume will be the V6.  Base-to-base, G90 loses to the competition with standard V8s.  Lexus’ 4.6L V8 has 386 horsepower.  The Mercedes 4.7L bi-turbo V8 has 449 horsepower.  But Genesis’ V6 has more horsewpower than BMW’s base 3.0L Twin-Turbo V6 that has 320 horsepower. The optional Genesis engine is the 5.0L GDI V8 with 420 horsepower and 383 lb.ft of torque.  The BMW 750i with its 4.4L Twin-Turbo V8 has 445 horsepower.  So Genesis’ V8 is a bit below the German V8s.

So what?  The Genesis G90 with the Twin-Turbo V6 performs very well.  Teamed with an 8-speed automatic transmission, the G90 has excellent performance.  Power is delivered smoothly and continuously.  The powertrain is seamless and unobtrusive.  There are only two options – V8 and All wheel drive.  Driving the V6 with both rear and all wheel drive, we did not feel any noticeable difference.  It wasn’t snowing.

Genesis planners want to have an interior that is “whisper quiet” and the NVH of the car delivers.  The interior is quiet.  Conversation is easy at any speed.

Rumor has it that Hyundai called in Lotus Engineering to help fine tune the G90s suspension.  True or not, the suspension feels biased towards a German feel – purposeful and taut.  It is not the cushy, absorbent feel provided by the Lexus LS.  Handling is stable with little body lean.  Nothing not to like.

On the Road to Autonomous Driving  The Genesis G90 is loaded with standard driver assist and safety features.  Many standard features on the G90 are in optional packages on the competition.  As more and more is being written about autonomous driving, the G90 has some features that qualify.  With standard adaptive cruise control and lane keeping assist the G90 can cruise in heavy traffic pretty much autonomously.  But, if the driver has their hands off the wheel for longer than 13-seconds, the car insists you touch the wheel again.

I found the lane keeping assist pretty accurate on twisty mountain roads in British Columbia, but there were a couple of times the car was obviously going to overshoot a lane marker and I had to take over.  I would be confident in using this in heavy Los Angeles Freeway gridlock, but would stay attentive when on the twisties.

Base Pricing Guess – $65,000 – $70,000  Genesis is not ready to divulge pricing for the G90 yet.  As brands usually say at a press event prior to introduction, pricing will be set closer to the release date.  But the pricing of the competition can show the general area the G90 will be priced.  The more-powerful V8-only S-Class has a base price of $95,650.  G90 will not be that high.  The less powerful in-line 6-cylinder BMW is priced at $81,500.  A 750i V8 is priced at $97,600.  The lowest priced facing competitor is the Lexus LS at $72,520.  But lets look at the Genesis sister ship the G80.  The G80 starts at $41,400 with a 311-horsepower 3.8L V6.  Check all the boxes and you get the G80 up to $50,350.  The V8 G80 is $54,550 fully equipped.  Any guess at what the base price for a rear wheel drive G90 with the V6 would be?  Our guess is the base price will be between $65,000 and $70,000.  For a V8 G90 with All Wheel Drive?  Maybe $75,000.  I could be high.


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“Trucks” to Continue to Outsell Cars – XSUV Segment

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500 wide Car Truck Sales 1987-2021500 wide Car Truck Mix 1987-2021AutoPacific, an automotive specialist research and product planning consultancy, forecasts that trucks, including XSUVs will be about 60% of the market for the foreseeable future.  In fact, reading the crystal ball for the next five years, this percentage of the mix may be low.  The charts above detail how cars and truck sales and market penetration have evolved since 1987 and the forecast for the future.

The hottest product segment in the American light vehicle market is the crossover SUV (XSUV).  A crossover SUV can be as large as a Chevrolet Traverse or as small as a Chevrolet Trax.  There are dozens of XSUVs in between.  And there will be more.

The XSUV segment has become so hot because this type of vehicle corrects the criticisms buyers had of traditional SUVs which sold very well, but were not optimal.  Buyers wanted products that were not hard-core off-roaders, but more civilized and city friendly.  The SUV market exploded in the early 1990s with the introduction of the Ford Explorer and Jeep Grand Cherokee.  It wasn’t until 1996 that the crossover SUV began slipping into the marketplace.  First the Toyota RAV4 and Honda CR-V appeared.  They were followed by the luxury crossover RX300.  Clearly the manufacturers were listening and reacting.

Here are just a few of the things we know about the evolution of the SUV market over the next five years…

Cadillac  Cadillac states that it has too few XSUVs (one, the upcoming XT5) and wants to add two or three more to its lineup while adding one more car as a range topper between now and 2020.

Buick  Buick is adding the small Envision XSUV to its lineup this Spring.  Envision is assembled in China.

FCA Drops Cars to Add XSUV and Pickup Capacity  Fiat Chrysler Automobiles is dropping its Chrysler 200 and Dodge Dart in favor of more capacity for XSUVs and pickups.  The Ram pickup will take over the FCA Sterling Heights, Michigan Plant when the Chrysler 200 is dropped.  FCA’s huge Belvidere, Ilinois plant will be populated by XSUVs when the Jeep Compass and Patriot plus the Dodge Dart fade away.

Toyota Pushing RAV4  Toyota Motor Sales has stated that they would not be surprised if the RAV4 XSUV overtook the Camry mid-size car as its best selling product.  Camry was the best selling car in the USA in 2015.

Lexus will add a 3-row XSUV above the RX350 in the next few years.500 wide SUV XSUV Sales 1987-2021500 wide SUV XSUV Mix of SUV 1987-2021

 

The charts above show the impact of crossover SUVs on the light truck market.  Huge volume increase and market share increase.

Hyundai Aggressively Adding XSUV Capacity  Hyundai is replacing 50,000 units of car capacity in its Montgomery, Alabama assembly plant with the Santa Fe Sport.  That drops capacity for the Hyundai Sonata and Elantra from 400,000 to 350,000 units per year.  Hyundai admits that they underestimated the demand for XSUVs years ago.  This capacity move reacts to market demand and dealer pressure to get Hyundai dealers more XSUVs that are easier to sell and require less incentives and discounting.

Hyundai will add 45,000 units to its Tucson compact XSUV volume this year.  Built in South Korea, Tucson has been limited because it is popular around the world and the vehicle was capacity constrained.

Hyundai also recognizes there is a hole at the bottom of their XSUV lineup and are adding a sub-compact B-Segment XSUV to fill that hole.  There is a possibility that a smaller A-Segment XSUV will replace the Hyundai Accent hatchback.


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Owners Rate Most Fun to Drive Cars

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Fun to drive can be defined an infinite number of ways.  The sports car driver will say power and acceleration, braking and handling are the main contributors to fun to drive.  There is also the element of sexy head-turning styling ringing the sports car driver’s bell.  The sport utility driver will add functionality to that equation.  A smart fortwo driver may think its quirky styling, minuscule size (even with its funky transmission) add to the fun to drive experience.

The most fun to drive vehicles in AutoPacific’s New Vehicle Satisfaction Research – those with 85 % or more of their drivers totally satisfied with its fun to drive characteristics include:

2014 Chevrolet SS1.  Chevrolet SS:  We can certainly understand this one.  Fully loaded 4-door sedan with a Corvette V8, the SS is a great value and adds sedan functionality to a high performance platform.  Not a big seller, the SS buyer certainly understands the special car they are driving.  One hundred percent of the respondents were totally satisfied with its fun to drive characteristics.

2015 Chevrolet Corvette2.  Chevrolet Corvette:  Corvette is the quintessential American sports car.  Big with dramatic styling and powered by a large displacement push-rod V8, the Corvette not only has the dynamics for a fun to drive winner, but also the looks.

 

2014 Porsche Cayman3. Porsche Cayman:  Curvaceous styling with Porsche DNA, German precision and sprightly dynamics have 94% of Cayman drivers totally satisfied with the fun to drive of their car.

 

 

2014 Porsche Panamera4.  Porsche Panamera:  The most expensive of the fun to drive vehicles is the Porsche Panamera 4-door sedan with 93% of its owners totally satisfied.  Sometimes criticized for its ungainly looks, it checks the boxes for fun to drive.  Panamera is in the top ten in power and acceleration.  Panamera is top ranked for braking. Panamera is in the top five for handling.  Not bad for such a large car.

2014 smart fortwo5.  smart fortwo:  There are fifteen cars that score 85% or higher in fun to drive.  Surprising is one of them is the smart fortwo with 92% of its drivers totally satisfied with its fun to drive.  Acceleration and powertrain performance clearly are not strong suits for the fortwo.  Only 28% of fortwo owners are totally satisfied with power and acceleration, so there are other things contributing to its fun to drive.  Maybe it is handling? – 72% are totally satisfied with its handling.  Maybe getting good fuel economy is a contributor? – 76% are totally satisfied with fuel economy.  Maybe just fortwo’s quirky styling just puts a smile on their face?

2014 Porsche Boxster6.  Porsche Boxster:  The first of the “baby” Porsche entries has sometimes been called a chick’s car, and maybe it is if you watched the episode of Two and a Half Men where Alan buys one, but its owners 91% of its owners are totally satisfied with how fun to drive it is.  Owners rate the Boxster in the top ten of totally satisfied with power and acceleration, braking, and handling – all strong contributors to fun to drive.

2015 Nissan 370Z Coupe7.  Nissan 370Z:  A “classic” sports car, 90% of Z-Car owners are totally satisfied with its fun to drive attributes.  It is in the top ten in power and acceleration, but comes up shy in handling ranking 12th and poorly in braking where it ranks 53rd.

2014 Jaguar F-Type8.  Jaguar F-Type:  Jag’s new sports car entry has 90% of its owners totally satisfied with its fun to drive.  F-Type is in the top ten in power and acceleration, 11th in braking and 25th in handling.  Clearly, F-Types powertrain strongly contributes to its fun to drive and combined with its classic styling owners score the car very strongly.

2014 Subaru BRZ9.  Subaru BRZ:  The BRZ may be a new category of sporty coupe.  It is built to be extremely maneuverable and fun for a young person.  Small, rear wheel drive, and with the ability to drift around corners, 89% of its owners are totally satisfied with its fun to drive.  In the case of the BRZ, its power and acceleration does not deliver on its looks or fun to drive image.  Only 30% of BRZ owners are totally satisfied with its power and acceleration ranking it 225th.  About 56% BRZ owners are totally satisfied with its braking.  Where BRZ shines is in handling with 84% of its owners totally satisfying.  It appears that Subaru could improve the standing of the BRZ if engine power was increased substantially.

2014 Chevrolet Camaro10.  Chevrolet Camaro:  A classic American muscle car, 89% of its owners are totally satisfied with its fun to drive attributes.  Camaro ranks 17th in power and acceleration with 73% totally satisfied.  It ranks 18th in braking with 77% of its owners totally satisfied.  Camaro ranks 10th in handling.  These are solid results for a sporty coupe showing Camaro succeeds not only on the basis of its iconic image and styling, but also on dynamics.

2014 Ford Mustang11.  Ford Mustang: The outgoing Mustang still has a lot going it with 88% of its owners totally satisfied with its fun to drive.  Mustang owners rank its power and acceleration 28th with 68% totally satisfied.  Mustang falls to 95th in braking with 65% totally satisfied.  It is 55th in handling with 71% totally satisfied.  Clearly, style, image and reputation have gone a long way in contributing to Mustang’s position among fun to drive cars.

2014 MINI Paceman12.  MINI Paceman:  The wierdly styled MINI Paceman is totally fun to drive for about 88% of its owners.  46% of its owners are totally satisfied with its power and acceleration ranking 156th, other MINI entries rank substantially higher.  About 67% of its owners are totally satisfied with its braking ranking 52nd.  About 75% of owners are totally satisfied with its handling – 27th.  Head-turning styling and image strongly contribute to the fun to drive aura of the MINI Paceman.

2014 Mazda Miata13.  Mazda Miata:  Miatas, or MX-5s, are famous for how fun to drive they are.  About 86% of its owners are totally satisfied with its fun to drive attributes.  Miata is not supposed to be blindingly fast it is supposed to be fun and most owners recognize that.  Still, ranking 109th, 53% of its owners are totally satisfied with its power and acceleration.  About 68% are totally satisfied with its braking – 48th.  About 64% are totally satisfied with its handling – 29th.

2014 Mitsubishi Lancer EVO14.  Mitsubishi Lancer EVO:  The last Lancer EVO ranks 14th in fun to drive with 85% of its owners totally satisfied.  Generally, a car sold for its performance never lives up to the expectations of its owners in power and acceleration, but the EVO seems to be an exception.  About 71% of its owners are totally satisfied with its power and acceleration – ranking 22nd.  About 78% are totally satisfied with braking – 13th.  About 78% are totally satisfied with handling – 15th.  This is a pretty good all-around performance for dynamic attributes.  Sayonara EVO, you will be missed.

2014 Scion FR-S15.  Scion FR-S: The FR-S is the Scion version of the Subaru BRZ.  About 85% of its owners are totally satisfied with its fun to drive.  Like the BRZ, FR-S owners want more power and acceleration – only 33% are totally satisfied – ranked 222nd.  About 52% are totally satisfied with its braking – ranking 178th.  About 73% of FR-S owners are totally satisfied with its handling – that is what the car is designed for after all – ranking 37th.

Top Ten Fun to Drive Brands:  The ranking of brands includes the fun to drive results for all their entries.  The top ten brands are:  1) Porsche, 2) MINI, 3) BMW, 4) Audi, 5) Jaguar, 6) Fiat, 7) Scion, 8) Cadillac, 9) Lincoln, 10) Mercedes-Benz.


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Hybrid, Small Car Owners Least Satisfied With Acceleration

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Satisfied With Acceleration If you are a lucky enough to own a Jaguar XJ, you likely are extremely satisfied with the power and acceleration of your car. In AutoPacific‘s new car and light truck research, 100% of XJ owners are extremely satisfied. Overall, 51% of new car and light truck buyers are extremely satisfied with the power and acceleration of their vehicle. About 86% of sports car owners are extremely satisfied. About 71% of sporty car owners and 70% of aspirational luxury cars are extremely satisfied. At the other end of the spectrum are owners of hybrids and small cars. Only 37% of hybrid owners are extremely satisfied with power and acceleration compared with 40% of small car owners. This might be expected since these products are biased toward maximum fuel economy usually at the expense of spirited driving.

Prius Plug In Hybrid Owners Least Satisfied with Power and Acceleration

Prius Plug In Hybrid Owners Least Satisfied with Power and Acceleration

Toyota Prius owners are least satisfied no matter which Prius is owned. Only 19% of Prius Plug-In Hybrid owners are extremely satisfied with the power and acceleration of their vehicle. Only 20% of Prius c owners are extremely satisfied. Only 24% of Prius v owners are extremely satisfied and only 27% of the Prius are extremely satisfied. Other Toyotas in the bottom twenty include the Matrix (21%), Lexus CT200h (29%) and Scion xD (30%). Ten of the bottom twenty are hybrids in addition to the seven models from Toyota are: Hyundai Sonata Hybrid (24%), Honda CRZ (26%) and Honda Insight (27%). Four economy cars are among the lowest rated: Honda Fit (25%), Nissan Versa (25%), Mazda 2 (27%), Ford Fiesta (28%), Kia Rio (29%) and Hyundai Accent (30%). Completing the bottom 20 are: Mazda CX5, Mitsubishi Outlander Sport, Mitsubishi Outlander and Jeep Patriot.

How Important is Power and Acceleration? Of course, one of the key questions is how important power and acceleration is to these owners. Overall, 39% of owners say power and acceleration is extremely important to them. So the industry is overachieving slightly having 51% of owners extremely satisfied. Among hybrid owners, only 23% say power and acceleration is extremely important (compared with 37% satisfied). Among small car owners, power and acceleration is important only to 28% (compared with 40% satisfied).


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2013 Lexus LS460 – Welcome Facelift and F SPORT

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The Lexus Flagship – the LS460 4-door sedan – is freshened for the 2013 model year.  This comes after an all new Audi A8 in 2011, a tweaked 2012 BMW 7-Series, and the new Cadillac XTS (which may not be in this class).  A major change for the Mercedes-Benz S-Class is due in early 2013 as a 2014 model year.  The Jaguar XJ that was all new in 2009 as a 2010 model gets a much needed all wheel drive system for 2013.

2013 Lexus LS460 F SPORT


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EuroLuxury Psychographics – What You’d Expect

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Psychographics are any attributes relating to personality, values, attitudes, interests, or lifestyles. Each year, AutoPacific includes a battery of questions in the New Vehicle Satisfaction Survey that allows us to determine what the psychographic profile of each brand and model.  The results are often fascinating, or simply obvious, but confirming perceptions you might have had about a brand.

AutoPacific’s psychographic model has been developed using input from over 200,000 respondents to the New Vehicle Satisfaction Survey from 2009 through 2012.  Applying this model to our latest data lets us make valuable comparisons such as for the European Luxury Brands shown below:


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2011 Jaguar XJ L: Bring On The Fancy Feast

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The Jaguar is considered an endangered specie due to a small population and the continued poaching of them for their hide.  Another Jaguar that is equally rare is the Jaguar XJ L.  One look at the 2011 XJ L and you you’ll likely want to poach one of these from a Jaguar dealer and enjoy the aroma of the leather hides used in the seats, the sound of the V8 exhaust, and the exterior design that is fresh and doesn’t resemble anything of the past thirty years or something from Bavaria. 


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Cadillac Launches Premium Care 2011 Model Year

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Cadillac Adds Premium Care  Cadillac is adding standard scheduled maintenance – Premium Care – to its 2011 Model Year products. Providing scheduled maintenance is a way to demonstrate commitment to the customer, reduce ownership costs and increase customer loyalty. BMW has been offering scheduled maintenance for years and has effectively shed its “Break My Wallet” image that existed prior to the scheduled maintenance program.

Premium Brands Abandoned Standard Scheduled Maintenance  In the past, most of the European luxury brands included standard scheduled maintenance – BMW, Audi, Mercedes-Benz, Jaguar, Land Rover. As costs went up and belts had to be tightened all with the exception of BMW dropped out. Surprising because consumer input to AutoPacific has indicated that standard scheduled maintenance is a strong enticement in selecting one brand over another.  BMW was winning the battle with no competition.

Standard Scheduled Maintenance Returning as Customer Satisfaction and Marketing Tool  Brands have begun to slowly return to standard scheduled maintenance as a customer satisfaction enhancer and sales enticement… Volvo, Volkswagen are now on board.  Jaguar has added its Platimum Coverage for 2011 that provides all scheduled maintenance for 5-years or 50,000 miles.  2010MY Land Rover models include scheduled maintenance for a short period after
purchase. Perhaps they will follow Jag’s lead.

In any event, standard scheduled maintenance appears to again gain traction in the marketing wars at the top of the market.  That VW has adopted it may indicate adding standard scheduled maintenance even to popular high volume brands.

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2008 Meadow Brook Concours d'Elegance

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On August 3, I finally returned to one of my favorite summer events, the annual Meadow Brook Concours d’ Elegance. Held the first weekend of August every year since 1979, this Concours is one of the premier events of its type. Not quite as prestigious as the Pebble Beach Concours happening the weekend of August 16 (yes, the same weekend as Detroit’s Woodward Dream Cruise), Meadow Brook has earned a strong reputation. For me, it’s simply a chance to wander among cars from storied brands of today and yesterday. Delahaye, Packard, Auburn, Duesenburg, Pierce-Arrow, Studebaker, Peugeot, Ferrari, Cadillac, Lincoln, Chrysler, Rolls-Royce, the list goes on and on.

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As you enter the Concours d’Elegance, the show starts.

Meadow Brook is home to a mansion of the same name built by the widow of John Dodge, one of the two Dodge brothers that helped establish the automotive industry we know today. The home and its property now belongs to Oakland University. Aside from the sheer joy and pleasure of celebrating the automobile as an art from, the event’s purpose is to raise funds for upkeep of the 88,000-square-foot mansion and its grounds. Seems a fitting choice of fundraising event.
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