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.
The 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.
Image Source: Genesis Motors USA
The new Genesis brand of luxury vehicles has been launched with Hyundaispeed! Bbalee! Bbalee! Quick, quick in Korean.
Finally, Hyundai Launches a Luxury Brand After years of deliberation, argument, and negotiation, Hyundai has launched the new Genesis brand. Hyundai officially announced the new Genesis brand in November 2015. Erwin Raphael was appointed head of Genesis in March 2016. The new Genesis brand goes public in September, 2016. That is quick – bbalee, bbalee!
In reality, the new Genesis brand is not a big deal. The brand will have only six vehicles by 2021. This does not approach the dozens of models offered by Mercedes-Benz, BMW and Lexus.
But wait. That is wrong, Genesis is a BIG DEAL! Genesis is the only luxury car brand launched after 1990 that has a deep pockets major manufacturer behind it. Tesla, launched in 2004, is questionably viable in the long term.
Hyundai has decided after years of consideration that a stand-alone luxury brand is a BIG DEAL. The resources of Hyundai are committed to guarantee its success. Hyundai presently has about 835 dealers in the United States. The new Genesis brand will launch with about 300. These have been selected with great care. The Genesis Institute will train dealer salespeople across the country.
Aggressive Launch Marketing The new Genesis brand launches with all guns blazing. Genesis launches as the luxury car sponsor for the National Football League. They are the sponsor for the Los Angeles Open golf tournament at the Riviera Country Club. These sponsorships are sure to make a splash. By early 2017, awide cross-section of American car buyers will know Genesis as a brand. They will know Genesis now exists as a brand rather than just a few car lines resting atop the Hyundai Motor America lineup. This will get the new Genesis brand and the two vehicles it will initially have to sell – the G90 and G80 – on the radar of people who have money to spend on their next new vehicle.
While Genesis vehicles promise to be outstanding, the brand’s commitment to its customers is a cornerstone of its existence. Genesis wants to take the customer experience to a whole new level beyond Lexus, Mercedes and BMW.
Respect for Time Respect for the Genesis Customers’ time is of paramount importance. Time is precious and cannot be replaced. So lets call this the Genesis “Respect Initiative”. Tthe features of this “respect initiative,” hovever, last only for 3-years and 36,000 miles. The 3/36 commitment results from Genesis management estimates that up to 80% of Genesis vehicles will be leased and the majority of those leases will be for 3-years and 36,000 miles. During the “respect period” Genesis owners/lessees will get full maintenance, valet service, SiriusXM Traffic and Travel Link, navigation map updates, 24/7 roadside assistance with concierge service, and Genesis Connected Services. It would not be a surprise if Genesis has a comprehensive CPO (certified pre-owned used car) program in place by the time the first vehicles come off lease that would extend the “Respect Period” for subsequent owners.
Genesis Uses Hyundai’s In-House Advertising Agency – Innocean While Genesis is a stand-alone brand, it accelerated its launch by using Innocean as its advertising agency. Innocean is owned by Hyundai and also handles advertising for Hyundai brand vehicles. By using Innocean, Genesis gets a known quantity without lengthy reviews to select from numerous agencies vying for the job through lengthy and expensive reviews. Also, there is likely a “family discount” for using the in-house agency in there somewhere.
When asked by an advertising-savvy media member how the new Genesis brand will target its buyers after the NFL and LA Open hoopla, Genesis and their agency will “respectfully” target anyone who can afford to buy their cars. Genesis head Erwin Raphael contends they have no specific target buyer in mind – no age range, gender, or ethnicity. They are just targeting the ability to pay a certain lease fee for their G90 and G80 sedans. And after the brand is launched with heavy advertising and sponsorships, specific groups will be emphasized using Internet messaging and social media.
Product is the Foundation Leading to The Genesis Customer Experience Presently, there are six vehicles planned for the Genesis lineup. There are four cars and two SUVs. The G80 luxury sedan is on sale now. It is a 5-Series/E-Class competitor. The all new G90 (formerly Hyundai Equus) luxury sedan goes on sale in September. It is a competitor to the Lexus LS, Mercedes S-Class and BMW 7-Series. Later comes a BMW 3-Series competitor – the Genesis G70. Then a near luxury sport coupe is launched. There will be a mid-luxury sport utility vehicle and a near luxury SUV. Frankly, they cannot get these SUVs on the market quickly enough.
Based on driving the G90 and G80, Genesis products promise to give the best entries in the competitive set a solid run for their money. Initially, they will be value propositions. You will get more features and content for your money. Such a deal!
Mercedes-Benz Sprinter with a MasterSolutions upfit package. (Photo by Ed Kim)
As published on Forbes.com
Daimler’s Sprinter commercial van has been a pioneer in the North American market, introducing commercial customers here to the tall and slab-sided European-style van format all the way back in 2001. Today, this format’s U.S. sales surpass that of the traditional American-style van as the latest full-size commercial vans from Ford and FIAT Chrysler Automobiles have followed Sprinter’s lead.
Image by: George Peterson
Infiniti QX30 Launched One of the fastest growing product segments is the Luxury Small Crossover SUV (XSUV) category. Infiniti has been a bit late to the party as there are already 33 small XSUVs on the market. Eight of those are luxury brand XSUVs: the Acura RDX has been out since 2013 in its second incarnation, Audi Q3 out since 2014, BMW X1 out since 2014, Land Rover Discovery Sport out since 2016, Lexus NX200t out since 2015, Lincoln MKC out since 2015, Mercedes GLA since 2015, Range Rover Evoque out since 2012. Launch of the Infiniti QX30, while a bit late, pretty much has every brand in the fray.
Infiniti enters the fray with the Infiniti QX30, making it the 34th member in the small XSUV market and 9th luxury brand XSUV. Remember, QX is the Infiniti nomenclature for SUVs whether they are body-on-frame SUVs (QX80) or crossover SUVs (QX70, QX60, QX50). Infiniti cars carry names that begin with a simple “Q”.
All USA QX30s Classified as Trucks The Infiniti QX30 is a highly styled small crossover available in front wheel drive and all wheel drive powertrain configurations. In other markets the all drive model is called “Q30” indicating Infiniti is classifying it as an hatchback car. In the USA, both versions are classified as trucks.
Dramatic Infiniti Design Cues Differentiate QX30 The Infiniti QX30 is sporty and curvaceous like most Infiniti models. It has bulging front fenders sweeping back and down with a strong character line. Infiniti decribes the character lines as “dramatic and turbulent”. The windshield is very fast flowing into a steeply dropping roofline. The front end is instantly recognizable as an Infiniti with its unique “double-arch” grille. In the side view, Infiniti’s signature crescent-shaped C-pillar further differentiates the vehicle. There is a lot going on there, but it works very well in this small XSUV.
Infiniti QX30 and Mercedes GLA Share Platform To keep the investment in line the Infiniti QX30 is assembled in Sunderland, England alongside the Mercedes-Benz GLA. QX30 and GLA share platforms, but Infiniti has loaded its entry with all the latest high tech electronic gadgetry available.
Engine Power at the Low End of Competitive Range The 2.0L 4-cylinder turbocharged engine is shared with the GLA and is manufactured by Daimler in Kolleda, Germany. Power output is 208 horsepower with 258 lb-ft of torque. Compared with other luxury XSUVs this power output is anemic. Driving the QX30, the performance is adequate, even pleasant, but a power output of between 230 and 240 horsepower would be more expected from an engine with these specifications.
The engine is mated to a 7-speed dual clutch transmission.
This article was first published on Forbes.com on June 9, 2016
Tesla Tops Auto Brand Satisfaction for Second Year in a Row Tesla owners are the most satisfied overall among all car and light truck owners according to the results of AutoPacific‘s 2016 Vehicle Satisfaction Award research. The annual study includes over 65,000 respondents for 2016 and covers 273 vehicles sold in the United States.
Tesla owners are almost unanimous in agreeing the Tesla is fun to drive, powerful, eco-friendly, upscale, safe, distinctive and expensive. These are not people who are really looking for the greenest car around, they want a car that makes a statement and can tear away from almost every other car when the light turns green. The fact that Tesla has been the top-ranking brand in AutoPacific’s research two years in a row is testament not only to how much Tesla buyers like their product, but at how well the brand has been positioned. Of course, Tesla today is a one-car brand and that one car has really resonated with its owners. Things may be different when data for the Model X and Model 3 are included in the years to come.
Other luxury brands trail Tesla. Cadillac, Lexus and Lincoln are next in satisfaction, then comes a surprise.
Kia Top Ranked Popular Brand Kia is ranked fifth overall and is the top popular brand in the research. This is quite a feat for a Korean brand that was just an asterisk fifteen years ago. Clearly, Kia products are capable of competing with the best. The Kia Optima mid-size sedan was third overall behind the Cadillac Escalade Luxury SUV and the Mercedes S-Class Luxury Car. These cost about three times what the Optima would cost. Kia owners see their vehicles as safe, fun to drive, comforting, a good value from a trusted brand. While these attributes are above the results for the industry as a whole, they bear little resemblance to the magnitude of the Tesla results.
Here are the top ten most satisfying brands:
Nissan’s luxury brand, Infiniti, is upgrading its two mid-size entries in the middle of their product cycle. This is not unusual these days as carmakers attempt to keep up with new technologies and keep fresh products available to their buyers. Infiniti’s one-two punch comes with new powertrains for the Q50 (nee G35/37) rear wheel drive mid-size sedan and freshened styling for the QX60 (nee JX35) front wheel drive/AWD mid-size crossover SUV.
The Q50 changes target enthusiasts and the QX60 changes target families. Let’s talk about the Q50 first.
Q50 Powertrain Updates Infiniti positions the Q50 against the Lexus IS and the BMW 3-Series. To us, it is closer to the Lexus GS350 in size and ambiance, but priced lower. Q50 looks the same as before. Its changes come in the form of new engines. The top-of-the-line is the Infiniti Q50 Red Sport 400. What does all that mean? The “400” is for the 400-horsepower twin turbo 3.0L V6 engine. “Red Sport” refers to the red “S” sport badge on the fenders and rear of the vehicle. The Red Sport 400 is very flexible from easily lumping around town in stop and go traffic, to quickly running rural roads. With several drive selections from Eco to Sport+ available, the personality of the car can transform dramatically. In Sport + mode throwing the car around sharp curves over undulating terrain is a blast. A fully loaded Q50 Red Sport 400 should set you back around $55,000 although pricing has not been finalized. About 20%-25% of Q50 mix will be Red Sport 400 models.
Rounding out the new powertrain news for the Q50 is the high volume engine which is a de-tuned version of the Red Sport 400 – a twin turbo V6 with 300-horsepower. This will be on 50%-60% of the volume. The Infiniti Q50 2.0t is powered by an all-new base engine developed with Daimler – a turbo 2.0L 4-cylinder with 208-horsepower. This will be on about 20%-25% of the Q50s sold. The power output of the 4-cylinder seems pretty anemic. Other 2.0L turbo 4s on offer today are more common with between 230 and 240-horsepower. Some even have as much as 270-horsepower. Infiniti says only the basic engine design is from Daimler. All the accessories and systems engineering were by Nissan engineers. The engine is produced in Infiniti’s Decherd, Tennessee Engine Plant.
QX60 Freshening Moderately Extensive The QX60 is Infiniti’s mid-market family hauler. It is in the middle of an SUV lineup that includes the flagship QX80 (formerly QX56), the “urban gorilla” QX70 (nee FX35/45/50). Below the QX60 is the QX50 (nee EX35) and the upcoming QX30 (based on a Mercedes 5-door bodystyle).
The 2016 QX60 looks pretty much the same as the 2016 model, but it does have new front and rear styling that evolves slightly from the 2015 version. The grille and headlamps are new and now de rigeur LED accent running lights are part of the headlamp design. Outside mirror-mounted turn signals are standard. The taillamps and liftgate are new, but look similar to their predecessor. Inside, the seat trim is new with more intricate sew styles. The instrument panel upper is softer and looks more appropriate for luxury brand vehicle. Driver assist technologies abound.
Responding to criticisms about ride control and handling, Nissan upgraded the suspension. While ride comfort was excellent, body lean in cornering was excessive. The update to the suspension yields a vehicle that is more confident feeling, more nimble and lighter on its feet. This is a very positive move forward.
While these updates to Infiniti’s mid-market entries are not earth shaking, they keep the vehicles fresh and up-to-date. The changes to the QX60 are more extensive, but the powertrain changes to the Q50 will get the most attention. Both are good moves.
2017 Lincoln Continental
The Mercedes-Benz Sprinter van was the first European-style full size van sold in the United States. Ford has added the European-style Transit van to its huge plant in Kansas City, Missouri. Ram is importing ProMaster vans from Europe. Nissan manufactures its NV vans in Canton, Mississippi and it is somewhere between a traditional American van and a European van. Only General Motors is left with a traditional American van with the Chevrolet Express and GMC Savana. In the overall scheme of things, Ford is the top dog by a wide margin and Mercedes is in fourth or fifth place depending on the month.
Mercedes Sprinter Update for 2015 For 2015, the Mercedes Sprinter is getting a minor update including new front end appearance with more distinctive headlamps and grille. Optional safety features now commonly found in cars are available: blind spot assist, lane keeping assist, collision prevention assist and highbeam assist. On the Sprinter 2500 model, Crosswind Assist is standard. Because big vans present a large flat surface to the wind, they are susceptible to being knocked around in crosswinds. The Crosswind Assist system alleviates Crosswind threats at speeds over 50mph.
Of significance, the Mercedes Sprinter receives a 4×4 model for 2015. The base 4×4 system is prices at $6,500 with an additional $300 for low range capability. The 4×4 will likely be popular in the Snow Belt and Mercedes predicts between 6% and 9% of its mix will be 4×4. Sounds a bit low.
Diesel Engines The base engine in about 50% of Sprinters is a 161HP 2.1L 4-cylinder diesel with 266 lb-ft of torque. The 4-cylinder diesel is mated to a 7-speed automatic transmission. The optional 188HP 3.0L V6 diesel has 325 lb-ft of torque.
Re-Assembly Strategy for US Cargo Vans Mercedes Sprinter cargo vans are “re”-assembled at a small plant in the suburbs of Charleston, South Carolina. The former Western Star/American LaFrance plant is now the sole source for Sprinter cargo vans in the USA. Only about one third of the plant is used at present with plenty of room for expansion.
Now with 3 Roof Heights
Chicken Tax Avoidance Strategy Because of the 25% “chicken tax” (tariff) in place since 1967, truck manufacturers have used various schemes to avoid the crushing price penalty. At one point, Toyota added pickup boxes to its small pickup at the port in Long Beach, California. Ultimately, the major Japanese truck manufacturers added assembly capacity for their trucks in the USA. Toyota manufactured Tacoma pickups at NUMMI (a joint venture with General Motors) in Fremont, California and now manufactures Tundra and Tacoma pickups at a plant in San Antonio, Texas. Nissan has a huge truck plant in Smyrna, Tennessee and another in Canton, Mississippi. Even Honda has truck capacity for its Ridgeline in Ohio.
Mercedes avoids the chicken tax by re-assembling Sprinter vans in the USA. They are first completely manufactured in a plant in Dusseldorf, Germany. They are disassembled so that the powertrain is separate from the body. The bodies are loaded into containers (one or two per container depending on configuration) and shipped to Charleston. The powertrain components are shipped separately in lots of eighteen. Unloaded at the plant in Charleston, the body moves through thirteen six-minute stations. The Charleston plant can re-assemble between 60 and 75 Sprinter cargo vans per day. In 2013, the plant produced over 14,000 units. The top customers for these vehicles are FedEx (who insisted Mercedes add the vehicles for the American market) and Winnebago.
Saving the 25% chicken tax results in a 12% to 13% increase in the cost of the Sprinter in the USA, but the savings are still 12% to 13% lower than if the tariff had been paid.
Future Mercedes Vans in the USA Mercedes is adding more vans to its lineup in the future. The European mid-size Vito van (with the “Metris” name in the USA and Canada) will be added in Fall, 2015 in passenger and cargo versions. Another passenger van – the V-Class – was introduced in Munich in January 2014 and on sale in Europe from Spring 2014. Think of the V-Class as a van equivalent to the Mercedes S-Class sedan. Also in the offing for the USA is the smaller Mercedes Citan van introduced in Europe in 2012. Given the capacity available at the Mercedes van plant outside Charleston, it would not be surprising to see the Metris cargo vans assembled there similar to the Sprinter cargo vans.
The 2014 Mercedes-Benz S-Class is the highest scoring Premium Luxury Car in AutoPacific’s 2014 Ideal Vehicle Award research. The S-Class designers really hit the nail on head. Clearly, they understood who the target buyer is and developed a vehicle that met their requirements. The S-Class beats out a very impressive group of premium luxury cars such as the BMW 7-Series, Porsche Panamera, Lexus LS, and the Hyundai Equus. Not only does the S-Class win its IVA class, it also was the highest scoring car EVER in AutoPacific’s Vehicle Satisfaction Award Research for 2014. This gets it AutoPacific’s President’s Award that has only been awarded one time previously. George Peterson, President of AutoPacific says “The S-Class is hitting on all cylinders. Not only did it score the highest satisfaction rating AutoPacific has EVER recorded, the product itself has hit its target market in terms of what they want in styling, packaging and engineering.”
S-Class owners truly do not want their vehicle changed. Of the fifteen categories in the Ideal Vehicle question battery, the Mercedes-Benz S-Class led in six satisfaction categories and was within three percentage points of another three.
The top five highest ratings by S-Class owners are: Same interior lighting, same ride and handling, same safety features, same seat fit, and same ease of getting in and out.
No vehicle is perfect. S-Class owners would like to see more cargo space and a simpler information and entertainment system.