Detroit Auto Show Recap: Small Trucks Are Getting Big and More – Businessweek (blog)

Posted: Thursday, January 16, 2014

The North American International Auto Show is a bit of a crystal ball. Every year, it offers a handful of concept cars that hint at what people might be driving in a decade, while executives unveil a bunch of slightly less-slick vehicles that will hit dealerships in the next 12 months. It’s a lot for even the most sober car enthusiast to take in, and the line between exciting new products and pie-in-the-sky is sometimes tough to see. That said, here’s our distillation:

1. Small trucks are getting big.
U.S. companies have dominated the large-truck segment, but in recent years they have all but ceded the small-pickup space to international rivals—namely, Toyota’s (TM) Tacoma and Nissan’s (NSANY) Frontier. That’s about to change. The first big reveal this week in Detroit was the GMC Canyon, a midsize offering aimed at buyers whose biggest haul involves a trip to Costco. This was just a few weeks after the smaller Chevrolet Colorado was unveiled in Los Angeles. Worst-case scenario for General Motors (GM): Toyota keeps its market share and the new pickups take a bunch of business from buyers who would have otherwise bought GM’s bigger machines. Best-case scenario: The little rigs drive off with a ton of money.

2. Volvo and Volkswagen aren’t there yet.
Both companies say they are on track to improve on lackluster U.S. sales, but neither had a new, exciting production model to show off, promising big changes to their fleets late this year and early next. In the meantime, they’re committed to increasing and improving their marketing message. According to Alain Visser, senior vice president of marketing for Volvo (VOLVB:SS), the company wants to burnish its cars’ reputation for safety, while Vinay Shahani Volkswagen’s (VOW:GR) head of American marketing, said his charge needs to underscore its precise German engineering. Suffice it to say there are Super Bowl ads in the works.

3. Garish is good.
This car show was a particularly flamboyant one. Nearly every podium had a splash of bright red or a row of vibrant blue machines. Turns out supersaturated paint jobs are a bullish economic indicator. In a tight economy, earth tones are abundant, because those who still have the scratch for a new car don’t want to stand out. When business is booming, carmakers crank out more models and opt for a brighter palette to stand out amid other new products. Audi (NSU:GR), in particular, played the color card more than any other company this year.

4. Cadillac is creeping up on the Germans.
The luxury line posted a 22 percent gain in vehicles sold in North America last year, besting a 14 percent gain from Mercedes (DAI:GR) and BMW’s (BMW:GR) 10 percent sales bump. Not surprisingly, Cadillac set up shop on the showroom floor directly across from Mercedes and down the row from the rest of the uber-luxury gang. It was the first time the blue chip brand displayed its fleet so far from its siblings in the GM family.

5. Your next car may text you.
As luxury brands jostle to out-tech one another, one of the slickest offerings of the show was at the Hyundai (005380:KS) booth, of all places. The Korean company said its high-end Genesis sedan, in addition to being chock full of safety features such as a heads-up display, will sync with an Android-based app that taps into a driver’s Web searches, contacts, and calendars. If you have to leave for an appointment in five minutes, the car will send a text to your phone (or your Google (GOOG) Glass) asking if it should get itself warmed up. Give the Hyundai engineers a couple of years and it may well come pick you up, too.


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