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Lincoln Wins VSA – Most Satisfying Brand in AutoPacific 2014 Research

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Lincoln Motor Company Logo BigLincoln Wins VSA – The Lincoln Motor Company won AutoPacific’s Vehicle Satisfaction Award for top brand of the 2014 model year.  Lincoln has previously won in 2004 and 2011.  Based on queries from the press, many are surprised at the success of Lincoln in AutoPacific’s research.  After all, Lincoln is portrayed as being a brand struggling to survive in the hotly contested luxury vehicle market in the USA.

Solid Performance Accross the Range Lincoln is battling to rebuild itself.  Winning AutoPacific’s Vehicle Satisfaction Award shows that Lincoln is beginning to sell products worthy of winning their respective product categories.  The MKS Executive Car won its class.  The MKZ was the top Luxury Mid-Size Car and the MKZ Hybrid was the top Hybrid/EV Car.  The MKT Luxury Crossover SUV was a close second in its class.  Also, Lincolns are sold to buyers with a median age of 68-years, 11-years older than the typical new vehicle buyer.  It is an adage of automotive research that to achieve great satisfaction scores sell your products to your grandmother – older females being less critical.  Never sell to a young guy (much more critical – a proof of why Scion is the bottom ranked brand for 2014).  Winning AutoPacific’s VSA will help Lincoln re-build its image once word gets out to dealers, owners and prospective buyers, but it is not until new Lincoln products get launched that Lincoln resumes its place as a fully fleshed-out luxury brand in the USA.  We’ll watch to see if Lincoln can repeat its VSA win in 2015 after the new MKC small crossover SUV has been on the market for awhile.


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Cars & Coffee – September 8, 2007, Irvine, CA

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Whenever we can get up early enough on a Saturday and roll down the 5 Freeway to Irvine, we like to take in the Cars & Coffee get-together in the Ford Premier Automotive Group parking lot. This Saturday was special because Morgan Patrick joined our video team as ace interviewer. You will be able to see her video podcasts over the coming weeks.

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Morgan Patrick discusses Bugatti Veyron with VehicleVoice producer David Barrett and cameraperson Cameron Barrett

The story behind Morgan’s arrival at VehicleVoice begins with her brother Keagan who is a car-nut staffer at AutoPacific. Keagan writes many VehicleVoice stories and has been seen on several of our video podcasts. After watching the video-casts, Keagan suggested that we add female interviewers to the mix to spice it up and get the attention of younger male viewers.
Well, a week or so later, Keagan’s sister, Morgan, showed up at AutoPacific offices in a friend’s Lamborghini. Not only was she in an outasight car, but she could talk about it intelligently. Putting two and two together, we come up with five and Morgan has joined our VehicleVoice team.
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Here are some shots from the latest Cars & Coffee. Quite an eclectic group this week ranging from a 1912 Mercedes 3795 recently purchased by the Mercedes-Benz Classic Center in Irvine to a Bugatti Veyron.
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“Are you from the EPA? Are you from CARB? Are you from the DMV? No? OK, I can talk.” A line-up of Nissan Skyline GT-Rs caught the attention of almost everyone who has ever played a videogame.

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Former AutoPacific Car Crazy Jacko talks with Morgan about his Skyline

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Recent addition to Mercedes-Benz Classic Collection in Irvine – a 1912 Mercedes 3795 (it is not “officially” a Mercedes-Benz)


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Who Will Ford Sell Parts of PAG To?

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This article appeared in the July 26th web-release by the British business magazine The Economist. VehicleVoice commentary is peppered throughout.
Ford: A costly distraction
July 26th 2007: From The Economist print edition
Ford is selling off its premium brands. Who will buy them?
Ford’s High Hopes for the Premier Automotive Group Never Materialized
WHEN Jacques Nasser, Ford’s boss in the late 1990s, bought two premium European car brands, he had high hopes for his new luxury-car division, which came to be known as the Premier Automotive Group (PAG). By 2005, the firm predicted, Aston Martin, Jaguar, Land Rover and Volvo would sell 1m cars a year, earn more than $1 billion annually and account for about one-third of Ford’s profits. But eight years on the PAG is consistently losing money and sells about one-third fewer cars than predicted—and Ford itself is haunted by the spectre of bankruptcy.
New Ford Regime Under Alan Mulally Puts PAG on the Block Piecemeal
After some initial hesitation Alan Mulally, the chief executive brought in from Boeing last September, decided to put bits of the PAG on the block. In March he sold Aston Martin for $848m, and in June he appointed three banks to field potential buyers for Land Rover and Jaguar. The bidding period ended on July 19th with an unexpectedly high number of potential suitors, thought to include Cerberus Capital Management (the private-equity group that bought Chrysler in May), TPG Capital, Ripplewood Holdings and One Equity Partners (a private-equity firm where Mr Nasser now works), along with India’s Tata Motors and the Mahindra Group.
Click here to find out more!
VehicleVoice Spin: How much of this is circuitous reporting by the international media? Ford has admitted that potential sale of Jaguar and Land Rover is on the horizon, but how accurate is the list of potential bidders The Economist cites? Wouldn’t it be interesting if Cerberus bought Jaguar and Land Rover to be the luxury marques for Chrysler Group?
Ah, Here Comes the Volvo Rumor Again…
Ford is also considering a sale of Volvo, a Swedish maker of premium cars, and the most valuable and profitable bit of the PAG. Last year Volvo is believed to have made a profit, though the PAG as a whole lost $2.3 billion. (Ford does not break out details of the division’s financial results.) But although selling Jaguar and Land Rover would make sense, it is less clear that the same is true of Volvo, says Jonathan Steinmetz, an analyst at Morgan Stanley, an investment bank. Volvo is more integrated into Ford than the two other brands, with several Ford and Volvo vehicles sharing chassis designs and parts. Volvo is also far bigger by units sold—it accounted for 7% of sales in 2006, compared with 3% for Land Rover and 1% for Jaguar—which helps to spread development costs.
Former Chairman of AMC Says Ford Should Unload All of PAG and Tend to Knitting
But Gerald Meyers, a former chairman of the American Motors Corporation, a carmaker bought by Chrysler, thinks Ford should sell all of the PAG and get what cash it can. Since Ford is in the middle of a multi-year turnaround plan, any distraction from rescuing its core American business is counterproductive, he argues. (In a sign that the plan might at last be working, Ford announced a surprise profit of $750m for the second quarter on July 26th.)
Now This One Doesn’t Make Much Sense
BMW of Germany is one possible bidder for Volvo. BMW says it is keeping its eyes open for takeover targets, though it has had its fingers burnt by acquisitions in the past. Volvo and BMW are compatible premium brands, says Marc-René Tonn, an analyst at MM Warburg, an investment bank in Hamburg. But they do not fit technically: Volvos rely on front-wheel drive, BMWs on rear-wheel drive. Renault would be a more logical buyer, says Thierry Huon at Exane, a brokerage in Paris. Renault needs a premium brand, having failed to build one itself. And the Renault and Volvo brands, with their common emphasis on safety, fit together well.
VehicleVoice Spin: BMW tried its hand with “The English Patient” – Rover and Land Rover – in the 1990s. BMW ended up selling Rover to an investment group for £10 and selling Land Rover to Ford for a couple billion dollars. Volvo cars are based on front wheel drive platforms, BMWs are rear wheel drive (with the exception of MINI). There isn’t much synergy here. Much different mindsets as well. This could well be The English Patient all over again if BMW is so anxious to acquire more brands.
Volvo Group Buys Back Volvo… Now That’s an Idea
Another possible buyer is Volvo Group, the lorry-making (heavy trucks, to Americans) parent firm that sold its car unit to Ford in 1999. This would reunite the two divisions, but there are no synergies between carmaking and lorry-making, which is why the cars were spun off. It is more likely that Renault will sell its 21% stake in Volvo Group to help finance its purchase of the carmaker.
Can Ford Recoup Its Investment in Money and Resources in the PAG Units?
Estimates of the proceeds from a sale of the PAG range from $8 billion to $16 billion. Ford could invest the money in its remaining brands—Ford, Lincoln, Mercury and Mazda—or in product development. But it would probably be wisest to restructure its health-care liabilities, which it is currently discussing with the United Auto Workers (UAW), the car industry’s main union. Mr Mulally is pressing the UAW to set up a union-managed trust that would enable Ford to take tens of billions of dollars of retiree health-care liabilities off its balance sheet. Such a trust would need to be funded up front—so cash from the sale of the PAG would come in handy.
VehicleVoice Spin: <Ford’s immediate headache is the 2007 UAW negotiations and indeed medical costs are a major part of the equation. Ford needs concessions to improve its profit picture and help guarantee those UAW workers their jobs. But, this is still the car business and Ford has fallen behind. Not as far behind as Chrysler, but General Motors has certainly taken the lead in product development of late. Ford needs to restructure not only the Company but also its product lineup. If getting rid of PAG – including Volvo – gets their attention back on the ball, so be it.
But think of these things… Many Ford middle managers now have positions with PAG brands either in Europe or headquartered in Irvine, California. Would they go back to the mother ship? Have they learned enough at PAG brands to be an asset to Ford? Would their departure hurt the PAG brands further? On the product sharing side, The Economist article rightly states that Volvo, Ford and Mazda are successfully sharing platforms. How could Volvo continue that in a cost-effective way if they were to be sold? The transfer pricing would be a bitch. Don’t forget either that the new Land Rover Freelander II/LR2 shares its architecture with the upcoming Volvo XC60. Wow, this is complicated.


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Here We Go Again… Ford To Sell Volvo!!!!!

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In some ways, we have been remiss with our coverage of the potential restructuring of Ford Motor Company through the sale of Aston Martin, Jaguar, Land Rover and Volvo. Most of the reporting in the popular and business media has been tilting at windmills. Reporters reporting rumors without verifying facts. And the latest twitch that Ford is to soon announce it is selling Volvo may indeed be the same.
Jaguar, Land Rover and Volvo comprise Ford’s Premier Automotive Group and their American headquarters are just five exits south of AutoPacific on the 5-Freeway. Of course, Ford has already sold off Aston Martin for just shy of $1 billion. Is there more to follow? We don’t KNOW, but we have some ideas.
Is the Press Generating its Own News?
If you have followed the business news, the British press has piled on Ford selling Jaguar and Land Rover. Jim Hall’s June 27 story puts much of the rumor blame on Keith Crain’s Automotive News having overreacted to a short blurb in British car mag Autocar. Once AutoNews ran the story everyone else jumped on. Similarly, recent reports have Ford selling Volvo a much larger and more profitable proposition than selling off Jaguar and/or Land Rover. Would there be a likelihood that Ford could off-load all of PAG? Another don’t KNOW, but it would be difficult. More on that later.
Loans Collateralized by Jaguar/Land Rover/Volvo Assets At Risk?
The huge loans Ford took last year used its automotive assets as collateral. That included Jaguar, Land Rover and Volvo. Should Ford attempt to unload those assets, then the basics of the loan would have to be renegotiated. And Ford’s automotive assets without Jag/LR/Volvo or any of the three may not meet the coverage requirements. That’s another don’t KNOW, but a guess.
Unbundling Product Sharing Will be a Problem
Over the years, Ford Motor Company has attempted to make its product development activities more efficient by sharing products between Ford/Jaguar/Land Rover/Volvo/Mazda. In fact, Ford’s super successful European Focus/Mazda3/Volvo S40/V50 platform has resulted in excellent vehicles for each brand. Similarly, the Land Rover LR2 (Freelander II)/Volvo XC60 will be shared. Ford based the Jaguar S-Type off the LS Platform which also yielded the Lincoln LS, the Ford Thunderbird and, loosely, the Ford Mustang.
While these relationships may be maintained or even strengthened if Ford sells-off one or more of the PAG brands, it won’t be easy.
And if Ford gets rid of its PAG brands it will miss out on the revenue and profit potential of the critically acclaimed Jaguar XF sport sedan and the Volvo XC60 Crossover SUV.
We Believe ‘Em, Don’t We?
So, as of July 18, 2007, we believe it when Ford says it is looking at all options, but that the Company has not made a decision to sell Jaguar, Land Rover or Volvo. Think about it this way, Chrysler’s merger of equals with Daimler-Benz was not leaked before it happened. Great security. Similarly, Ford’s acquisition of Volvo came out of the blue. Maybe there is just too much smoke now for there to be any fire.


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Rumor of the Week – BMW Considering Volvo Take-Over From Ford!

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There have been rumors circulating recently about BMW buying Volvo Cars from Ford. Ford Motor Company stated on May 29, 2007 it is not in discussions with BMW or any other company regarding the sale of Volvo Cars.

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But sometimes where there is smoke, there is fire. This rumor has been circulating for a few weeks now. The rumor goes like this… BMW has been conducting due diligence about the possibility of acquiring another brand. Volvo Cars and Alfa Romeo have both been included in the rumor, but Volvo appears to be the strongest candidate.
Why Would BMW Need a Second Car Company?
From 1994 through 2000 BMW owned Rover – including Rover, MG, Rolls Royce, Bentley, Mini, Land Rover and the defunct names Austin, Morris, Riley, Triumph, Wolesley. Whoa, what a lineup!? BMW practically owned the British motor industry with the exception of Jaguar. Termed “The English Patient”, Rover and BMW never gelled. In 2000, BMW sold Rover Cars (MG Rover) to Phoenix Holding Group for £10. They sold Land Rover to Ford for a hefty chunk of change. They got snookered out of the Bentley name and somehow Volkswagen ended up with it. They kept Mini and have made it a great success. They kept Rolls Royce and are presently building modest numbers in Goodwood in sourthern England.
But, BMW needs additional volumes to help its economies of scale. A second company would help BMW in negotiations with components suppliers. Volvo has the heft to help handsomely.
BMW Fiercely Proud of its Independence
BMW is advertising the advantages of its independence. They look down their nose at Lexus – part of Toyota, Infiniti – part of Nissan, Acura – part of Honda, Audi – part of Volkswagen, Mercedes – part of DaimlerChrysler. So, the idea of BMW acquiring some other premium brand has to be considered from the position of strength.
European media reports have speculated that BMW wants to expand its product portfolio, and would like to add a premium brand with front-wheel-drive models to help spread out development costs for its Mini range. (BMW has been spreading some costs already co-developing the new Mini engine with Peugeot).
Volvo could be a good candidate to fill that objective. One of the reasons Ford acquired Volvo was because of its excellent front-wheel-drive large car platform that underpins the S80, XC90, S60, V70, XC70. Ford uses this platform for its Taurus (Five Hundred), Sable (Montego) and Taurus X (Freestyle) vehicle lines. The lower Volvo models have platforms shared between Ford, Mazda and Volvo. How a BMW acquisition of Volvo could untie these relationships must be a central part of any acquisition strategy. (Remember, BMW V8s powered the Range Rover until the 2006 model year – a hang over from BMW’s ownership).

Volvo Part of Ford’s Premier Automotive Group

Ford acquired Volvo in 1999 for $6.5 billion and made it a cornerstone of its Premier Automotive Group which also includes Jaguar and Land Rover (purchased for $2.7 billion in 2000). Ford has sold the fourth PAG brand – Aston Martin – to investors for slightly less than $1 billion. PAG lost $327 million in 2006.
Reports say that Merrill Lynch estimates Ford could raise over $9 billion by selling the remaining PAG brands.
Nobody’s admitting anything yet, but lets see if the denials hold up over time.


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Cars & Coffee – March 24, 2007

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The weekly Cars & Coffee meet at Ford’s Premier Automotive Group Headquarters in Irvine always brings a potpourri of interesting cars. From oldsters to the most recent exotics, Cars & Coffee is an egalitarian event showcasing interesting cars from all eras. As often as possible – or when we get up early enough – AutoPacific and VehicleVoice staffers attend Cars & Coffee.
This week, a lineup of Chrysler 300s, Dodge Chargers and Dodge Magnums rolled into the event and dominated more than a row of show space.

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Chrysler LX Lineup Took Over a Row

The Chrysler 300s rumbled in and ranged from stock to heavily modified. Some of the modifications were very well done and probably should be considered for production. Others were overdone… showing a lack of sophistication and taste. They took over more than a row of the show space and attracted interest from both older and younger spectators.
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Bentley vs. Maybach – Which Would You Take?
This probably is one the few Maybachs that may be privately owned. What hotel would have a license plate “WHEEEE”? Of course, ridiculous to sublime. Is the Bentley the ridiculous car or the Maybach?
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Line of Classic Mercedes Sandwiched Between Ferraris
There were a fair amount of Ferraris, a couple of Astons, a Callaway S7, several Ford GTs and even this line of classic Mercedes roadsters at today’s Cars & Coffee. While the current exotics got a tremendous amount
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Golden Retriever Woodie Combination
The Golden Retriever in the backseat of this great looking Woodie considered everybody a friend. What a great combo – Golden and a pristine Woodie. Don’t even think about the dog hair.
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Made Me Remember My 1969 Boss 302 Mustang
This new Saleen Mustang is the Parnelli Jones edition… costs a bit over $60,000. Painted Grabber orange just like Parnelli’s Trans Am Mustangs of the late ’60s and early ’70s, this car made me lust after a new one. (The 1969 was notoriously unreliable… had fragile piston skirts and valve train offset by a 50,000 mile powertrain warranty). The backlite louvers reminded me of what a bitch it was to get the snow out of the louvers when the car was parked back to the wind. No rear window defroster. Snow caked under and between the louvers. Frostbitten hands.
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Lovingly Restored 1967 Ford F250 Ranger Camper Special
My personal favorite was this 1967 Ford F250 Ranger Camper Special. Lovingly restored, the Camper Special had been taken apart piece-by-piece and brought back to better than new condition. Having been the “chief heater hose engineer” on Ford Trucks as an engineering grad trainee, I appreciated the attention to detail even in routing the hoses under the hood. Wow, nice job. Note, the truck has an auxiliary fuel tank.


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VehicleVoice#40 – Ford Hosts the All New "Cars and Coffee" in Irvine, California

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This Saturday was a red letter day for Southern California automotive enthusiasts. For the past several years some of the most rare and exotic cars that are still roadworthy have gathered informally each Saturday morning at Crystal Cove Promenade (a really upscale strip mall on Pacific Coast Highway) in Newport Beach, California. And for nearly that long, the Center’s owner, the Irvine Company, has been giving the group a hard time about it. Finally, after threats, resident complaints, lots of orange traffic cones, and probably a dozen or so lawyers, the informal Crystal Cove auto show got the boot.

Ford to the rescue! Ford’s Premier Auto Group stepped in before the show’s walking papers were even dry and invited all those owners, enthusiasts and incredible cars to come by their place at the Premier Automotive Group and Mazda North American Operations campus. Saturday, October 21st was the first Cars and Coffee, and based on the turn out of about 350 cars, Ford’s invitation was heartily accepted.

David Barrett, a frequent visitor to Crystal Cove has a new place to hang out early on Saturday mornings.

Show Runtime – 4:42

Show Rundown
00:18 David Barrett , VehicleVoice host
01:01 Bill Baker , host of the INHD show Ride to Adventure
02:05 Ford Skyliner , owner Wayne MacCartney
02:24 Lancia Scorpion , owner Mark Mayuga
03:10 Nash Metropolitan Hot Rod , owner Bryan Thatcher
03:42 Hyundai Chief Designer , Joel Piaskowski


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Cars & Coffee Eclipses Crystal Cove

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Before dawn on Saturday October 21, 2006, Ford opened the Premier Automotive Group and Mazda North American Operations campus to “Croissant Derelicts”. It was a stunning success with over 350 cars on display.
As you might remember from last week’s story, the Irvine Company kicked the “informal” Saturday morning car show out of the Crystal Cove Promenade on Pacific Coast Highway in Orange County, California. Too much congestion, too much noise, blah, blah, blah. Ford steps in offering up its nearby campus adjacent to the upscale Irvine Spectrum, but not nearly as muy elegante as Crystal Cove.
John Clinard, Ford’s Regional Manager of Public Relations was the principal driver of the event. Hats off to John. He really knows how to pull the folks together.

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Would they come? ABSOLUTELY! In an in-your-face showing to the Irvine Company, car enthusiasts in Southern California flocked to the new venue in Irvine which is about five exits south of AutoPacific’s headquarters in Tustin.
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An eclectic array of cars is on display every Saturday at Cars & Coffee


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Crystal Cove Concours Kaput – Goodbye Croissant Derelicts!

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Today marks the final Saturday morning Crystal Cove mini concours in Newport Beach. Starting at 0700 each Saturday morning for years, Crystal Cove has become the spot for car owners and enthusiasts to gather over coffee and donuts on Saturdays. Unlike Donut Derelicts up Pacific Coast Highway that has a hot rod flavor, Crystal Cove had a exotic car flavor even though there were a few hot rods and classics thrown in. VehicleVoice and AutoPacific correspondents and many local auto industry folks were on hand to bid farewell.

Irvine Company Crushes Crystal Cove Car Event

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Seen here is Barry Meguiar of Meguiar Waxes and Freeman Thomas of Ford. Meguiar is explaining what has gone on concerning the weekly Crystal Cove event. He describes typical Irvine Company “gestapo tactics” in shutting down the event. An approach to local upscale mall – Fashion Island – led Irvine Company to warn the retailers there not to discuss holding the event at Fashion Island.
What were the reasons for kicking the event out? Apparently there was too much traffic congestion. The Newport Beach Police said traffic was not a particular problem. The cars were too high performance and unsafe at speed. Newport Beach Police said that they had not given out an extraordinary number of tickets before, during or after the event for the years it has been held. And finally, the local residents complained of noise and congestion. Heck, the local residents were some of primary participants.
The event was over each Saturday at 9AM a full hour before the retail stores in the upscale Crystal Cove strip mall where there is a Starbucks, nice pastry shop and Trader Joes. The Starbucks and pastry shop will sorely miss the Saturday morning crowds – business they wouldn’t get otherwise.
Ford to the Rescue
Ford circulated flyers at the final Crystal Cove event and opened their Premier Automotive Group and Mazda Campus to the Crystal Cove enthusiasts. PAG and Mazda is adjacent to the Irvine Spectrum – another upscale shopping area, but without the oceanside ambiance of Crystal Cove. The Ford venue promises to be more spacious and more inviting… but I think it is on Irvine land as well.


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