| Japanese Automakers with North American Head | | | | all short-term debt and unemployment realities |
| Quarters are moving the ball forward and | | | | came up in mid 2003. It is still all up in the air now |
| pressing on into the future with new technologies | | | | in 2005.Honda has had good success all during the |
| for safety, fuel economy and net-centric | | | | 1999-2002 auto sales boom as large city's streets |
| systems. Before retiring from the auto | | | | and highways fill up to nearly gridlock. People |
| aftermarket franchise industry, I took a tour | | | | knowing of Honda reliability and some having been |
| around the nation to see what I had built and visit | | | | burned in the late 80's with lousy quality would not |
| all our franchisees. During this trip I visited all the | | | | buy an American car if you paid them. They are |
| all Major Japanese Auto Manufacturers North | | | | extremely loyal to Honda. In my early days in |
| American Head Quarters as part of our 2002 | | | | business I had met the Honda Brothers when |
| Victory Tour.We are seeing a major push by | | | | they came to the US to buy a long range Cessna |
| Japanese Auto Makers to re-gain lost ground | | | | 150 Aircraft and even then they were very |
| from post 9-11 lost market share by domestic | | | | aggressive with the latest and greatest |
| manufacturers due to the Zero/Zero Financing | | | | technology. At the time I was selling aircraft, boy |
| Strategies of 2001-2002. Toyota had gained | | | | has Honda come a long way indeed. Today they |
| incredible market share in late 2002 against Ford, | | | | maintain new prototypes in all five categories of |
| GM and DaimlerChrysler. Toyota started to offer | | | | hybrid cars, from mixed units to pure hydrogen |
| a new SUV option on an old and most popular | | | | cell, from all electric to thermo-hydrogen-electric, |
| model. The 4-Runner now with an All-Wheel drive | | | | from natural gas to biofuels such as bio-mass |
| version for add safety and performance. We had | | | | methane and ethanol. It is amazing to the secrets |
| the opportunity of going to the Dealership party | | | | they keep in house with composites, finishes and |
| held by Toyota of North American Corporate to | | | | propulsion. Having spent the most of any of the |
| introduce the many Dealership Owners this new | | | | other foreign manufacturers on R and D projects, |
| vehicle. Also on display were the Hybrid cars and | | | | Honda looks to surpass the efforts of BMW, |
| trucks, which were soon be on the lots ready for | | | | DaimlerChysler and Ford in all categories of the |
| sale. They are selling many of those models | | | | newest Hydrogen Cell cars of the future. |
| today in 2005 and 2006 models. Toyota's profits | | | | Meanwhile the race continues to sell as many cars |
| were also way up due to the 2001 value of the | | | | possible and amass as much money as possible at |
| Yen against the Dollar. The Yen was at an all time | | | | all costs from nearly giving cars away on credit |
| low meaning that they could build the cars much | | | | with free hamburgers to pay back in the future. |
| cheaper and re-invest much of these profits in R | | | | All the domestics are hard set on displacing the |
| and D projects, some of hit the streets as early | | | | foreign manufacturers for good or buying them |
| as May of 2003 as they released the 2004 | | | | on the cheap in the case of a total collapse of the |
| models. This will be a war for all manufacturers as | | | | Japanese economy if the bad loans are realized |
| the aggressive Japanese Toyota company goes | | | | for what they are under the current political |
| for the gold.Mitsubishi Motors made quite a run in | | | | structure which would not only hurt auto |
| March, April and May of 2002 by proposing a Zero | | | | manufacturers but also cause heads to roll in |
| Zero/Zero plan. Zero Interest, Zero Down | | | | banking, securities and government. In 2005 the |
| Payment and Zero Payments until 2003 on all | | | | foreign automakers with their environmentally |
| Monteros, Gallants, Montegos and Eclipses. No one | | | | clean cars are out pacing domestics in those |
| knew what the fall-out rate would be on these | | | | categories presently due to fuel prices. They will |
| vehicles selling starting in March of 2003 as 90 | | | | out run any bad debts on auto loan fallout rates |
| day delinquent loans go unpaid from Mitsubishi | | | | as the economy is back and people have jobs, |
| Acceptance Corporation. In hindsight the | | | | the unemployment rate is extremely low in the |
| short-term strategy worked but the fall-out rates | | | | United States now.Likewise in the US if domestics |
| were disastrous indeed. Ford Motor Credit had | | | | are forced to raise prices as consumer fail to |
| also run into problems on failed auto loans in its | | | | repay loans and re-marketers sell 1-2 year old |
| major Ford Motor Acceptance Corporations unit. | | | | cars on the cheap next to the over inflated prices |
| My company was in the business of washing car | | | | of new models, we may see a glut three times |
| dealership lots in our Car Wash Guys Dealership | | | | as big as that of the used car dealerships, as we |
| Division which washed for many Mitsubishi | | | | saw some of this right after 9-11 and some at |
| Dealerships across the nation and counting them | | | | the time were worried that with no possible |
| out now would not be a good bet as the 2003 | | | | option of using financing incentives to bail them |
| models were stacked and the prices were very | | | | out things might get tough, that did not happen |
| good compared to the increased prices of | | | | and the industry ended up saving our economy in |
| Domestic Cars due to import steel tax and fallout | | | | robust sales. If this did take place during a period |
| rates of bad loans. Even more of a situation | | | | of slight inflation and fallouts in other financial areas |
| exists as Domestic Automakers realize that the | | | | such as credit cards and new homes which were |
| new 2003 fallout rates could reach over 8% and | | | | purchased on 2-10% down we could have seen a |
| therefore have raised prices 10% to counteract | | | | grouped of upside down consumers with nothing |
| this offset.Nissan had done well in 2000, 2001 and | | | | in the way of net worth to make them worthy |
| 2002 although had only gained moderate ground | | | | of a new car and auto prices through the roof to |
| against the other manufacturers and most of that | | | | cover bad debts. It would have been a disaster |
| came in the light truck market. Infinity did not do | | | | waiting to happen, luckily the Fed Acted properly |
| as well in 2001-2002 as expected however the | | | | and the tax cuts kicked in fueling small business |
| major consolidation in the auto dealership industry | | | | investment. One thing is for sure there will be so |
| by AutoNation, United Auto, Auto1, Sonic | | | | many cars on the road you will spend 1-2 hours a |
| Automotive and others shielded them from being | | | | day in traffic and that means a lot of dirty cars |
| hurt too bad as they are diversified with all brands | | | | out there for my company to wash? |
| from Hyundai to GM. This was a bad year for | | | | CarWashGuys.comHow did everything get so out |
| some manufacturers such as Daewoo, while other | | | | of control in 2001-2002 Auto Markets?It was not |
| brands made good headway. 2001 delivered | | | | all 9-11, it was not great before that as it |
| nearly 17 million cars to Americans and was said | | | | appeared that 2001 would end with only 14.1-15 |
| to have saved our economy as those sales | | | | million cars sold instead, they did slightly better |
| figures were thrown into the all retail sales | | | | with 15.1 million cars sold, which was still a |
| categories showing consumer spending good as | | | | disappointment from the 17.1 million of the |
| most retailers had a lousy Christmas in 2001. | | | | previous year. However by the end of the |
| Nissan did well due to its ability to catch the | | | | Zero-Zero of 2001 the game had changed and |
| consumer with flashy light trucks with pizzazz. | | | | the future risks became greater. The real |
| Excellent marketing if you ask us at the Car | | | | question was this, would there an emerging middle |
| Wash Guys, knowing of course that it was pure | | | | class that was expanding or would it be |
| brilliance.Mazda did well in early 2001 pre-9-11 due | | | | contracting? If it was expanding and that sector |
| to the gasoline price spike, with its many fuel | | | | was increasing now from let's say the Hispanic |
| economy models. But did not do as well during | | | | Population, would it be expanding enough to |
| post 9-11 as the domestics took off like a | | | | continue this rate of expansion in the auto |
| banshee from hell with Zero/Zero and lots of | | | | industry. Can our roads handle more cars? Can |
| retained earnings to carry them. GMAC took a big | | | | our bodies handle more pollution? Are there going |
| bite in Mazda's sales out of the gate in 2002 and | | | | to be any big consolidations in the Auto Industry. |
| Mazda is looked for it's 2004 models to help it | | | | What are the plans of the European Auto |
| catch up in Mid 2003. Mazda also got hurt in the | | | | Companies with names like Volvo, Fiat, Jaguar, |
| sales to rent-a-car companies and due to its | | | | BMW, Rolls Royce, Volkswagen, Peugeot, Saab, |
| domestic partner and major shareholder putting it | | | | Porsche, will these mergers continue with |
| in the back seat for now. Mazda Miata's sold | | | | American Auto Makers? Will one of these be on |
| excellent between 1999-2002 but not enough to | | | | the leading edge of new technology and leap-frog |
| carry the entire company. With a recent brand | | | | other companies with Hydrogen Cells? How many |
| re-identification under way they missed the boat | | | | cars can our country hold, who will buy them and |
| in early 2002 meanwhile Chrysler and Ford met | | | | most of all who will pay for them? All these |
| GM's Zero/Zero and the horse raced out in front | | | | questions were still out in the wind and we saw a |
| during a Buy American post 9-11 craze, the rest | | | | lot of cars coming off the Rent-A-Car lines and |
| was history. We are looked for an excellent | | | | hitting re-sale lots. Would cars with two years old |
| return to market position by mid to late 2003 | | | | dates be worth 1/3 of new due to inflated prices |
| from Mazda and of course their domestic partner | | | | to counteract fallout loan rates on the Zero |
| as GM's relentless pursuit of the Zero/Zero game | | | | Zeros? Would inflation take care of this? Would it |
| slowed down. GM was out in those years to wipe | | | | not? Lots of dynamics out there and we saw |
| the competition and with the GMAC home division | | | | many cards very well placed changing the game in |
| and new housing starts issues if the real estate | | | | 2001-2003 as we visit the best players of the |
| bubble caused walk always, these other | | | | greatest game ever created; The Free Market, |
| companies may see things rally take off. Good call | | | | and no industry contains more out for blood |
| as we see home sales robust even now in Spring | | | | players than the Auto Industry...God we love the |
| of 2005 and enough to carry the summer. Of | | | | game. God Bless the players, our customers and |
| course if interest rates hike up and inflation occurs | | | | the Game. And folks that is what the Auto |
| GM made a perfect play and inflation is moving | | | | Industry was all about in 2001-2003 and now you |
| forward and so is the FED with rate hikes, even if | | | | can see why things are the way they are now as |
| money flows out of the country race past | | | | the Auto Dealers and Manufacturers move into |
| inflows. All will be based on Iraq war, so far in | | | | hybrid fuel efficiency and net-centric electronics in |
| 2005 we are 187 Billion into the re-construction of | | | | the 2005-2006 models. The auto industry is a |
| Afghanistan and Iraq and we need those money | | | | huge important factor in the health of our |
| flows back. North Korean games and Iranian | | | | economy; Think about it.Lance Winslow - Online |
| nuclear material standoff and the consumer's over | | | | Think Tank forum board. |