By Jeff Sanford
Toronto, Ontario — August 11, 2016 — Some of the overlooked news from the week just past. In this week’s edition: The world finally gets a used car vending machine, the worst-selling vehicle in America and hail damage in Alberta.
-One picture that popped up all over the internet this week was of a fender bender in Vermont. The driver of a “classic” Mercedes 380SL backed into, and up onto the hood of a Ferrari 458 Special. Oops. Click here to see the video.
-Mercedes-Benz is having a good year. The company continues to lead in sales of luxury cars in the US. In July the US operations of Mercedes-Benz set a new company record “with 28,523 cars sold — an increase of 3.6 per cent over the same period last year,” according to a report on the website Businessinsider.com. The best-selling model is the C-Class with almost 44,000 cars sold this year. Lexus came in second place with 27,890 cars sold in July. BMW was third at 25,777 units. Audi sold 18,364 cars that month.
-Last Friday (August 5) Tesla disclosed that it had $1.1 billion in third quarter cash payments to make. The company is building a huge factory and expenses are piling up there. The payments for one quarter alone will suck up a third “of the cash on hand mid-year, in a new sign of pressure on the electric vehicle maker,” according to a report from CNBC. Tesla shares lost about 1 per cent in value on the news.
-Auto body shops in the Alberta town of Okotoks are still busy cleaning up the damage from a June hail storm. A local paper ran a picture of Ossama Kharfan, manager of Carstar Okotoks, who said the “shop has done close to 400 repairs since the June 28 storm hit.” Kharfan is quoted as saying, “That’s just the tip of the iceberg. There are a lot of people holding out until the end of the season.” He went on to say most repairs in their shop have ranged from $2,000 to between $6,000 and $7,000. He said “the amount of traffic coming through his shop this year is second only to the major hailstorm that wiped out vehicles across Calgary during the Stampede in 2010.” At that time thousands of cars were damaged.
-Two men in New Jersey this week were arrested when they were caught “trying to scam shoppers into having auto body repairs from a store parking lot.” A report on the local paper said that, “…officers were sent to the Sam’s Club parking lot…for a report of two men approaching citizens soliciting auto body repairs.” The officers located the two who said they were doing auto body repairs for interested customers. The men were in a 2008 Ford Crown Victoria, which was found to have been stolen in New York. Both were arrested and charged with receiving stolen property and soliciting without a permit.
-An article in Autoweek magazine tested the “worst-selling car in America.” According to the report the Mitsubishi iMiEV, a tiny electric car, has sold just 40 units in North America this year. California regulations are such that auto companies have to offer an electric car to sell other vehicles. And so the iMiEV can be found on lots across the continent. The reviewer of the car actually thought it was a great vehicle. According to the article, “The iMiEV has only 16 kWh of batteries, making it the lightest and cheapest electric car on the market.” The range was 62 miles. It sells for just under $24,000, though, Federal and California State rebates can take $10,000 off of that price. According to the tester, “…it’s a $14,000 car that needs no maintenance and will never wear out.” The reviewer powered his with solar panels he has on the roof of my house, which meant no outlay for gasoline or electricity from a utility. “The iMiEV has room for four full-sized, even large, adults, and room for groceries behind them. Fold the rear seats flat and you can, and I have, loaded a bicycle in back. It is the perfect urban and suburban transportation vehicle for the typical family where one spouse commutes every day and the other takes care of household duties.”
-Mitchell released its 3rd quarter industry trends report. The company now pulls out separate Canadian data as a part of the report. The effort is appreciated. This month’s report identifies an interesting trend: “In Canada, new OEM parts are 75% of total parts, with an upward trend in aftermarket parts.” That is, OEM parts make up the vast majority of parts used, but aftermarket parts are increasing share.
-Pictures of the new Tesla pick-up began appearing on line this week. The vehicle will be known as the Model U, for ‘utility.’ Click here to see what it looks like.
-Electric car maker GreenTech Automotive missed a debt payment this week. The company had big plans to “build 250,000 cars a year and invest $2 billion in an impoverished corner of Mississippi’s Delta region,” according to a report. But now it’s missed a debt payment to the state of Mississippi. The company owed $150,000 due June 30 to the Mississippi Development Authority. It was supposed to be the first payment on its debt. The payment never showed up. A report noted that, “GreenTech has raised money from Chinese people who can obtain permanent U.S. residency by investing $500,000 and creating 10 jobs. However, GreenTech may have fallen out of favour with green card granting authorities…. A US Citizenship and Immigration Services document showed GreenTech had only 75 employees last year, has produced only 25 cars and has sold none…the statements were contained in a decision earlier this year denying a green card to a Chinese investor, rejecting company projections that GreenTech would increase employment to 125 this year and 250 by 2018… Nicholas Colucci, chief of the immigrant investor program, signed a decision stating GreenTech had a ‘general lack of credibility from the failure to meet any projected timelines.’”
-The company that runs Auto Trader magazine announced this week that it will begin offering a new service. The company will begin using data mining techniques and predictive analytics to better match people with used cars. According to a press release the company has generated so much data over the years they “…can now identify where individual consumers are – and where they are headed – in their buying journey, and can enable manufacturers and dealers to reach these shoppers at the right place, at the right time, and with the right message on autoTRADER.ca.” Roger Dunbar, vice president of marketing at TRADER was quoted as saying, “Most Canadian car buying journeys involve autoTRADER.ca at some point, and that creates a lot of data…By leveraging this marketplace data high-ground, we will be able to project and stimulate the car buying journey for individual consumers. Our customers will have the ability to strategically place messages within the various stages of the consumer’s journey, increasing ad effectiveness and driving incremental revenue as a result.” Apparently people generally follow similar patterns in terms of what cars they buy as they get older. These trends can be used to target buyers.
-Carvana is a used car dealer using an e-commerce approach. The company has been mentioned in this space before. This week it announced that it has raised a $160 million to expand across the US. The company’s cars are sold online. The new owner has the choice of either “having your car delivered or available for pickup at one of the company’s ‘car vending machines’.” The car vending machine is, “literally a big glass building that automatically dispenses a car that is preloaded by the company in the days prior to the customer picking it up. Carvana opened their first one in Nashville last year, and will use this funding to open more around the country.”
-ICBC announced this week that it would make changes to its “modified collector vehicle program to allow specialty cars and trucks, up to and including 1974, into the program.” According to a press release ICBC currently has a modified collector vehicle program that allows individuals with vehicles registered as a 1958 model year or older to apply for modified collector vehicle status. At the request of the Specialty Vehicle Association of BC, the threshold for eligibility will be expanded from 1958 to 1974 to allow eligible modified vehicles within the muscle car era into the program. “The collector car industry is very important to B.C. and we want to open up the opportunity for more people to join in the experience of owning a true classic car and to be able to participate in classic car shows,” said Todd Stone, minister of transportation and infrastructure. In addition, the program will be expanded to include replica vehicles resembling North American production-built 1942 model year or earlier. People will be able to register the replica as it looks (for example, registering it as a 1937 Ford rather than 2014, when it was built). “We’ve seen the number of collector vehicles nearly double to 26,000 over the last decade in B.C.,” said Mark Blucher, ICBC’s president and CEO.
-A report on the website Truth-out.org notes that ride-sharing companies Uber and Lyft have stopped operating in Austin after the “city’s voters endorsed a requirement that drivers for these services had to be fingerprinted and undergo background checks. The companies complained that the requirement placed an onerous burden on them and instead said that they would just stop operating in the city.” A report suggests that, “Uber is worried about its drivers being labeled as employees. Uber claims that its drivers are independent contractors, not employees. As independent contractors, Uber is not responsible for paying Social Security taxes, nor is it liable for workers’ compensation for drivers who get hurt in traffic accidents. It also doesn’t have to withhold income taxes. And, independent contractors don’t have the right to unionize.”
-A story posted in the BC media this week noted the interest in car sharing company Evo, which just expanded its “Home Zone” to include the City of North Vancouver, Metrotown, Capilano University, SFU, and BCIT. A source quoted in the story says “he’s looking forward to using Evo to commute to work at BCIT on rainy days” or doing a big shopping trip. The cars are also equipped with bike racks so you can take the car somewhere, drop it off, and then ride home. “Definitely them having the bike racks is a selling feature for us,” said the source.
