Automotive Insider

Driving Innovation: Recent Automotive Trends

Trends shown by the U.S. Auto Industry have not only been a source of speculation for consumers of the last year, but also (as sad as it may be) a source of entertainment. With the trends of late 2008 and most of 2009 showing depressing results, looking at the trends of late may just add some much-needed optimism to the industry. Let’s take a look at the most recent industry trends.

Sales- Outside of the buying frenzy caused in the summer of 2009 by the “Cash for Clunkers” program, U.S. auto sales for December were the highest of any other time this year. Sales of Ford, Toyota, Honda, Nissan and Hyundai were up (all by over a 15 percent), while only the sales of GM and Chrysler were down (by six and 4 percent, respectively). Beyond these figures, another promising factor is that automakers claim to be earning these sales, rather than buying them; as most cited a lower amount of offered incentives compared to those offered in 2008. As could be expected, industry analysts expect sales to continue to increase through 2010.

Crossovers- While the concept of a crossover vehicle is not new to the auto industry, trends continue to stem from this category. The newest of these is what auto enthusiasts refer to as the “humpback.” With a wind-swept look, these vehicles are known to have rear hatchbacks and sloping fast back roofs. So there’s no question that they’re a crossover, but what did they crossover from? Experts are stuck on that one. Some say they’re a scaled down version of a coupe, while others argue that they’re a scaled up version of a sports car. Either way, with manufacturers such as BMW, Honda, Porsche and Aston Martin, there’s no argument that they are in a class of their own.

Smart Cars- No, not just the officially named Smart Car. Paralleling an international trend towards “smart” technology, cars have not been left behind. With the first hybrid car hitting the market in 1997 (in the form of the Prius), hybrid technology has become somewhat mainstream. Beyond the basic energy conserving advances displayed by the dozen plus hybrid cars now on the market, a new improvement has been introduced in the form of now-popular “plug-in” cars. These vehicles not only have an electric motor, but also have a plug which allows the owner to charge the vehicle electrically. As of recently, it was reported that there are only around 3,000 highway-capable plug-in cars on the market, but many automotive and environmental enthusiasts, this is a trend they hope to see accelerate in coming years. To take it a step further, GM is introducing a vehicle which combines plug-in cars with an equally popular technology: smart phones. The Chevy Volt, to be introduced in 2011, will enable its owners to use their smart phones to control vehicle functions such as scheduled charging, driving range status reports and warming/cooling the vehicle before getting in. Inevitably, other car companies will follow, so this is a trend definitely worth watching.

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The Secret’s Out: India’s Auto Industry on Undeniable Growth Streak

With humble beginnings dating back to the 1940’s, India’s automotive industry got off to a slow start due to tight government restrictions on the private sector. It wasn’t until India’s economic liberalization in 1991 that the automotive industry was really allowed to expand to reach its full potential. Starting with the growth of Indian automobile companies such as Maruti, Tata Motors and Mahindra and Mahindra, India began to gain a hold on the industry as a whole. As a result of this, multinational manufacturers began to take notice and invest in India’s automobile market as well. In early 2009, more than 100,000 passenger cars were sold in India.

For having such a slow start, India has gained pace quite well. It is cited that it is now the ninth largest automobile industry in the world, with a recorded production of 2.3 million units in 2008 alone. In 2009, India became Asia’s fourth largest exporter of cars (the top three spots went to Japan, South Korea and Thailand). Automobile companies such as Nissan, Volkswagen, Toyota and Hyundai have all expanded their manufacturing facilities to India, with Nissan and Hyundai predicting to export upwards of 250,000 vehicles from these sites by 2011.

In fact, the industry has taken off so well that India has become not only a site for manufacturing but a target consumer market for large international manufacturers. One such company is Toyota, which unveiled the concept version of The Etios at the 10th Auto Expo in New Delhi last week. The Etios is a compact car being developed specifically for India’s family market. Chief engineer of the Etios, Yoshinori Noritake, spoke about its development at the expo, explaining that more than four years and 2,000 engineers have gone into the vehicle’s making. To make sure that the car served the customers’ needs, Noritake visited several Indian cities and homes to get direct customer feedback about their preferred vehicle features. In an effort to keep costs down, Toyota is even attempting to use local parts whenever possible.

The New Delhi Auto Expo 2010; its success speaks volumes about the incredible growth of India’s auto industry. Before the show even began on January 5, it was expected to be the world’s second largest auto show ever to be held. However, bringing in more than 2 million visitors in 7 days and boasting 25 new vehicle launches; it turned out to be the world’s largest auto expo to date, beating out Shanghai’s Auto Expo 2009.

Further solidifying India’s emergence in the automotive industry is another development unveiled at the New Delhi Auto Expo 2010: the DYP-DC Center for Automotive Research and Studies. This innovative institute will combine the expertise of the DY Patil Group with the design genius of Dilip Chhabria, a world-renowned automotive designer to provide its students with world class automobile design instruction. In the words of the Mr. Chhabria himself, the institute was created with the goal to develop design, business and manufacturing skills alike, as well as to “ensure the non commoditization of skills across the board.” This is just one more example of continued success for India, first in manufacturing and engineering, and now in industry expertise in every sense of the word.

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Focused on the Goal: China’s Automotive Industry

Beginning in the 1930’s with the making of a single truck, called Ming Sheng, China’s automotive industry has shown a steady increase in manufacturing ever since. This steady increase in production was visible throughout most of the 20th century, as in 1992, China’s yearly auto production broke the one million unit mark.

However, the major acceleration of China’s automotive industry came in 2001, when China entered into the World Trade Organization. Between this entry in 2001 and the year of 2007, China’s automotive industry grew by an average of 21 percent year-over-year, resulting in the production of over eight million vehicles by 2007. In 2008, China manufactured more than nine million vehicles, allowing them to pass up the United States to become the second largest auto manufacturer in the world, right behind Japan. If this isn’t enough to solidify China’s position as a major player in the automotive market, China surpassed Japan and all other nations in November of 2009 to gain the title of the world’s largest auto market.

It doesn’t seem China is willing to give up their place in the spotlight either. It has been observed that development of the automotive industry may be the driving factor in the big picture of China’s industrialization. Chinese government is banking on the fact that rapid growth in this sector will be a catalyst for the growth of all other sectors as well. And it seems as though they are right on track for this plan to reach its full potential. The intense focus that the Chinese government utilizes when overseeing the auto industry as well as the infrastructure supporting it has the potential to not only keep China’s auto industry at the top of the global game, but it is on its way to also upsetting many of the manufacturing and trade relationships that exist today.

As an example of China’s focused plan of attack paying off, while the U.S. was in a significant economic slump, China held their gaze straight ahead. Their auto market maintained its increase in manufacturing numbers, and this is when it finally pulled ahead of the U.S. in manufacturing units.

While it has not been as big of a focus for China’s automotive industry before, they are now working on a plan to not only increase domestic sales, but to also upgrade the quality of vehicles manufactured so they can become more of a player on the global market. This plan originated in the 1980’s, when many Chinese auto manufacturers entered into partnerships with major foreign auto companies with the stated goal of producing vehicles to world standards, and therefore create an auto market dominated by a small number of international joint venture manufacturers.

In terms of the other part of this two-pronged plan, the domestic sales aspect, China has a plan for this as well. In fact, in November 2008, the Chinese government introduced a fiscal stimulus packaged in order to avoid the economic slump that was then (and still) affecting nations across the globe. Within this plan was a cut on the sales tax of smaller cars, and incentives aimed to promote sales of vehicles to consumers in rural areas. It seems these plans have created their intended effects so far, but the rest remains to be seen.

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Where To Find Discount Auto Parts

Finding auto parts is a pain. You’ve got to drive all over town (if your car still runs) and deal with unfriendly gear heads at the auto parts stores, who could care less if you’re getting the best price. The internet may be your best bet when it comes to finding auto parts for discount prices. Here are some places to look online to find a deal:

-Parts Hotlines (partshotlines.com) has an easy-to-use search tool that searches in real time for current parts in stock. It starts you off by entering the make, model and part you’re looking for (listed alphabetically) then asks for your zip code. The search results start with the closest locations; each item has a price list, stock number, number of miles the part has, and the carrier’s contact information. If the part is available through PartsHotlines.com, the search results list the price of shipping, and allow you to check out from that screen.

-Parts Train (partstrain.com) has a similar search function, but is a little more difficult to use, as parts are not listed alphabetically. Parts Train only lists its own parts, but does allow you choose between “All Parts,” “Replacement Parts” and “Universal” parts. The search results also only list the exact model year you a searching for.

-Auto Parts Fair (shopautopartsfair.com) has a search tool similar to Parts Hotlines and also appears to sell its own parts, but offers you more advanced search options after you have found your initial results—such as selecting parts by brand, price range, finish, or material.

To get discounted car parts, you can also search your local junk yard, but that’s dangerous, and very rarely rewarding. Most discount auto parts have been salvaged, so save yourself the trouble of searching by letting someone else do the finding for you, and look for your parts online.

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Discover The Truth About OEM Auto Parts

Not all auto parts are created equal. You might say, “Well, any part I buy should fit in my car just the same as another, right?” That may not always be the case. Here are some things you may need to know before deciding to buy parts from an aftermarket manufacturer or an OEM.

An OEM, or original equipment manufacturer, is a company that produces auto parts to the exact specifications of the carmaker—they are parts you would find at the dealer. Most automobile companies don’t actually produce the parts that make their vehicles run; the manufacturing of these parts is often outsourced to other companies, even though the auto company’s name may be on the box.

From there, the parts manufacturers are able to sell these parts to other wholesale distributors, who then put their own name on the box. Even though it is the same part produced in the same factory, the price of the secondary wholesaler’s part may be up to 70% cheaper than the exact same part with the auto company’s name on it. A little confusing, huh?

So why is it important to ensure that the replacement parts are OEM and not just any aftermarket product? Because OEM parts are manufactured to your automobile’s exact specifications. A non-OEM part is more than likely designed for a more universal application—it’s not fabricated to fit your car specifically, but fabricated to fit as many cars as possible. If you buy a non-OEM part, you may be purchasing an inferior part, and it may require modification when installed.

If you plan to install and OEM part yourself, read about it as much as possible in your car’s owner manual before installing. This may provide you with some useful information.

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