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Luxury Trucks Are Slaying Luxury Cars

Illustration for article titled Luxury Trucks Are Slaying Luxury Cars
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Good Morning! Welcome to The Morning Shift, your roundup of the auto news you crave, all in one place every weekday morning. Here are the important stories you need to know.


1st Gear: Trucks Trucks Trucks

CHEAP GAS, RECORD TRUCK SALES. It’s what I say in nearly every Morning Shift. And these aren’t cheap-ass trucks, either; they’re big, expensive, loaded luxury beasts driven heavily by incentives, in many cases.


What does that mean for luxury brand sales, which tend to rely more on cars than trucks and SUVs? Not good news, reports Automotive News. Most analysts are expecting the luxury market to cool this year.

Declining car sales in a truck-crazy marketplace. Luxury brands generally rely more on car sales than trucks. Luxury automakers are adding truck production, but not fast enough to keep up.

Demand may have reached a tipping point: Luxury truck sales outpaced luxury car sales each of the last three months, though the segment still sold more cars than trucks for all of 2015, according to the Automotive News Data Center.

[...] January got off to a rough start for some: BMW, Lexus, Cadillac, Acura and Infiniti all posted sales declines. Luxury executives are watching pricing carefully.

2nd Gear: Investors Obviously Shaky On Volkswagen

As Dieselgate drags on and Volkswagen battles with federal and state regulators on how to fix the emissions-violating cars in the U.S., shares are falling sharply for the embattled automaker, reports Reuters:

Uncertainty about the financial impact of the scandal on VW’s accounts has increased since the start of the year, sending its shares 26 percent lower.

However, Norway’s $850 billion sovereign wealth fund, the world’s largest, told the paper it would remain invested in Volkswagen, in which it holds 1.2 percent.

“VW is an important company for Germany, Europe and the world. That’s why we will keep our stake as long as the fund and the company exist,” the fund’s CEO Yngve Slyngstad said.

But he added that since 2008 the fund has criticized the ownership structure at Volkswagen, where the Porsche and Piech families hold 31.5 percent of the capital but control 50.7 percent of voting rights.


3rd Gear: Peugeot Pays Out

With sanctions recently lifted on Iran, PSA Peugeot Citroën is set to resume a partnership it had in the country with Iran Khodro. The French automaker pulled out of the market in 2012 amid the sanctions, and so it has agreed to pay nearly $450 million as a “no hard feelings” agreement to get the deal going again. Via the Financial Times:

PSA Peugeot Citroën is to contribute more than €400m-worth of compensation to Iran’s biggest carmaker for losses it incurred when the French carmaker left the country, as the two companies embark on a new joint venture to build vehicles.

Iran Khodro said that Peugeot had agreed to the arrangement to make up for problems caused in 2012, when it withdrew from Iran to comply with international sanctions against Tehran over its nuclear programme.

“Based on the deductions . . . €427.6m of compensation will be paid by Peugeot to Iran Khodro because of the losses [after the French company left Iran], of which some parts would not be in cash,” Hashem Yekke Zare, managing director of Iran Khodro, said on Sunday.


4th Gear: Fiat Chryslers Are Rolling Away Because People Are Dumb

Fiat Chrysler has a problem with newer Jeep Grand Cherokee and V6 Chrysler 300 and Dodge Chargers: they keep rolling away when owners think they’re parked, causing 121 (!) crashes and 30 injuries. Is it a mechanical problem?


According to Bloomberg, apparently not: the stubby mushroom-shaped knob that is the electronic gear shifter is confusing to drivers, leading to rollaway issues.

More than 300 complaints about rollaway problems have been reported to regulators and the manufacturer, according to the document. The cars have an electronic gearshift made by ZF Group that may not provide drivers with clear enough feedback in all cases about the gear they’re in, according to the document.

“We’re fully co-operating with the investigation,” Eric Mayne, a spokesman for Fiat Chrysler, said in a phone interview.


The National Highway Traffic Safety Administration has started an investigation, but there’s no plans for a recall yet. Can you recall the drivers for not knowing how to operate the cars they bought?

5th Gear: Fiat Chrysler Could Win At Fuel Economy Too

Fiat Chrysler has doubled down on Jeeps and Rams and is allowing the Chrysler 200 and Dodge Dart to die natural deaths. Future small cars could come from a partner. But what about the ambitious fuel economy targets they, and other automakers, must meet—54.5 miles per gallon by 2025?


However! Fiat Chrysler has this going for them, reports The Detroit Free Press:

The actual target will vary because the regulation includes something called a “footprint adjustment” provision. That’s a bureaucratic term for allowing different MPG requirements depending on a company’s mix of passenger cars and light trucks.

“Each manufacturer has a different target, said John Graham, dean of Indiana University’s School of Public and Environmental Affairs. “If you sell more small cars, you have a stricter (higher) target.”

So Marchionne’s decision to kill the Dart and 200 and produce more Jeeps and Ram pickups could have the effect of reducing the fuel-economy goal FCA must meet. The market that told him in 2009 that only a “nobody” would lack a competitive midsize sedan now tells him that Americans prefer the Jeep SUVs, crossovers and Ram pickups that generate nearly all his company’s profits.




Reverse: RIP


Neutral: Who’s To Blame For The Runaway Chryslers?

ZF, Fiat Chrysler or the owners? I’ve driven a bunch of cars with those gear levers and they’ve always stayed put for me. Have you experienced this “problem,” or is it just dumb owners?


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Garrett Davis

Blah, blah, blah, people are stupid, they don’t even use them as trucks, blah, blah, blah, they should buy wagons instead.

What unbelievable hypocrisy on this site from a whole crowd of people who love their big V8 sports cars and incredibly impractical little Miata’s. Yeah, you don’t need a big truck to get around, but hey, you don’t need more than 150hp and FWD to get around either.

People buy what they buy because they like them. Their choices might not always jell with what you happen to like, but that’s just fine. I daily my 20 year old RWD two seater that gets 22-23mpg on average, which isn’t far off the dude with the big Ram that parks next to me. He likes what he drives, and I like what I drive. What makes my cramped, far more impractical little sports car any better?

That. is. it. Lay off the judgement and just let people enjoy what they enjoy. If it puts a smile on their face and doesn’t hurt others, then I say go for it. Why are their smile worth less than our smiles? They aren’t.