Thursday, August 31, 2006

Car names (Auto parts)


Car names
The world of car names is something of a minefield. There are names that become rude in another language (eg Getz as in the Hyundai Getz, is apparently a slang expression for sperm in Hungarian) or are just plain daft sounding because they don't travel well across cultures (why would you call a heavy-duty truck range Big Thumb or a coach Super Dolphin? - makes sense to Japanese though). Japanese vehicle manufacturers have been responsible for many of the classics (eg Nissan Cedric, Isuzu Big Horn, Daihatsu Step-thru Pantry Boy, Mazda Bongo van, Nissan Stout pick-up). I recall fond sessions with the JAMA yearbooks many years ago when I worked as an analyst at the forecaster DRI (now Global Insight) and looked after the Japanese market for a while. Weird sounding model names considerably brightened up the rather laborious task of populating spreadsheets with sales and production data. But as China's auto industry grows, we can surely expect to see a steady flow of entertaining model names coming out of China (Geely has the Rural/Urban Nanny van, Beauty Leopard coupe). Even going for letters and numbers doesn't necessarily get you off the hook (MR2, phonetically in French, sounds frighteningly like merde - well, it wouldn't help sales in French-speaking markets I guess). Anyway, it is Friday afternoon. Someone has drawn my attention to an article that brings together a few of the car names that make us laugh (below link). Apologies if anyone finds my Brit-centric/schoolboy humour take on these things a little distasteful, but look, I expect Rover or Morgan means something really absurd or disgusting in Cantonese and I certainly wouldn't begrudge anyone in China having a good belly laugh at that.

2007 Audi Q7 Review
2007 Audi Q7 Review

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What makes for a profitable car business?
Mention of Jac Nasser's name in connection with Ford's current financial review of its operations and the possible sale of PAG brands revives that old debate about how far big car companies should be vertically integrated - especially downstream. Nasser took the wide view - get into high margin areas wherever possible: premium brands (PAG his idea); services allied to car purchase/ownership (financial services the obvious one - look at the profits GM and Ford's finance arms racked up over the years); distribution (get control of profitable parts of the automotive value chain). Let's face it: making cars in volume segments of the vehicle market is a fundamentally low-margin activity in what is an increasingly crowded global market. The firms that excel in that area with successful business models and big geographically spread volumes, large scale economies - like Toyota - are pretty difficult to catch if they have got themselves ahead. And they have. When Nasser was dumped, an alternative viewpoint came into vogue at Dearborn: 'back to basics'. That supposedly meant focusing on the business of making automobiles that the market wants. And get out of business activities that detract from that. Tough call to make at the time. I would just make the point to the Nasser critics out there that Ford's abrupt switch from what might be called 'Nasser-mode' to the much heralded back-to-basics, with its product emphasis, has hardly been a screaming success. Obviously there's a balance to be struck in a large commercial organisation between core business activities and getting into what might be viewed as more peripheral activities (even if high margin), but if the proponents of back-to-basics are judged on market share (seems reasonable - the market is the final arbiter), the evidence isn't all that supportive is it? Can it really be said that Ford is still undoing what Nasser did? Shouldn't there be some solid evidence by now that back-to-basics has put Ford on a much more solid footing product-wise in the US marketplace (though the European picture is much more positive)? Has Ford Fusion been a little bit late or half-hearted to market? I am not saying JN was always right, but blaming him for Firestone/Explorer - which was very expensive, a storm out of a cloudless sky in some ways - seems harsh, and the critics perhaps overlook the good ideas he had. Hindsight is a wonderful thing, naturally, but how much of PAG's failings are down to underlying business principles and how much is down to what might be termed 'execution'. What would Reitzle have done differently? Has Ford been well managed since Nasser bit the Ford dust? Why has Ford been losing share at home long-term? How much is down to the product on offer?

Long-Term Update: 2005 Porsche 911 Carrera S
Read this full Long-Term Update article at Motor Trend: The 911 is likely the best single-dimensional driving execution available in the mainstream marketplace.

First Drive: 2006 Dodge Caliber
Read this full Road Test, First Drive & Review Article at Motor Trend: Dodge threw out the Neon with the bathwater and replaced it with the Caliber.