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Troubled auto makers keep Detroit Auto Show flag flying news
12 January 2009

Auto enthusiasts have always looked forward to the Detroit Auto Show (officially the North American International Auto Show), an annual event that showcases America's love affair with automobiles. First held in 1907 at Beller's Beer Garden at Riverside Park, the event has been a consistent presence in the auto calendar, except for a decade during the War years between 1943 and 1952 when manufacturers were more concerned with survival than exhibiting their wares. Now, with the American auto industry in dire straits and the bankruptcy of the Big Three a very real possibility, the Detroit Auto Show is expected to bring some cheer to the town which has been the epicentre of the American auto dream.

Ford F-150Expectedly, the show began on a subdued note. A number of manufacturers, including Nissan, Mitsubishi, Suzuki, Rolls-Royce, Land Rover, Ferrari, and Porsche have expressed their inability to participate - the largest number of non-returning automakers in the show's history. However, the existing participants are trying their best to keep the industry flag flying.

General Motors, in spite of the current troubles threatening its very existence, has taken the lead in putting forth a brave face - it is exhibiting sixteen vehicles, four times last year's number. And it is putting a lot of faith in the potential success of the Chevrolet Volt. Michigan Governor Jennifer Granholm, marching along with the much-hyped electric Volt, held high a sign that said "Here To Stay," evoking the precarious condition that has threatened to thrust Detroit-based GM into bankruptcy.

GM also announced Cadillac will get a version of the much-talked-about Chevrolet Volt. It will be called the Converj, and like the Volt, it will be able to go 40 miles on electric power, after which a small gas engine will help get motorists the rest of the way home.

Chrysler recharged its surprising leap into the electric car race Sunday when the ailing automaker announced plans to add the Jeep Patriot small SUV to its stable of proposed electric vehicles. The company also unveiled a concept version of an electric-powered sedan, with executives saying the vehicles represent Chrysler's commitment to investing in future products and spending taxpayer loan money well.

Ford also announced to intention to become a leader in electric vehicle technology, bringing at least four vehicles to market in North America by 2012. The lineup would start with a battery-powered version of its Transit Connect van for commercial fleet customers in 2010, followed by battery-powered version of the Ford Focus one year later. It also unveiled the Lincoln MKT, a crossover vehicle larger than the 3-year-old MKX, to reignite interest in a premium brand ensnared in the industry wide sales slump.

Honda displayed the production version of its 2010 Insight hybrid that will hit showrooms in May and April, at a starting price of $23,650, below that of the Toyota Prius. Toyota is slated to display its third-generation Prius on Tuesday. The company also announced it will launch a pure electric car in the US by 2012.

Moving away from the surfeit of hybrid vehicles, Ford unveiled a new Taurus. The 2010 model is a complete redesign of the brand, turning it into a full-size sedan. It will offer a six-speed automatic and no price increase. European major Volkswagen showed off a sports car called the Concept BlueSport. The nifty two-seater is designed to carry a mid-ship-mounted clean diesel engine that VW said could deliver up to 50 miles per gallon on the highway.

Hyundai GenesisHyundai Motor Co won the car-of-the-year award at the show for the Genesis luxury sedan, marking a major step for the South Korean automaker in its push to produce a more upscale, mass-market vehicle for US consumers. The Genesis has been praised for its luxury touches, smooth ride and build quality for a price tag just north of $30,000. Giving American automakers something to be happy about, Ford's F-150 was named truck of the year.

However, all the optimism in the world couldn't wipe away the dismal figures. US auto sales fell 18 per cent in 2008 from the prior year to about 13.2 million vehicles, battered by a spreading credit crunch, recession and plummeting consumer confidence. Most automakers expect sales to decline even more in 2009. Ford expects US auto sales at 12.5 million or so at best. GM put the sales range lower, at between about 10.5 million and 12 million vehicles.

GM CEO Rick Wagoner said his company's restructuring plans submitted to Congress, which include concessions from the United Auto Workers union and other cost cuts, combined with GM's lineup of new products, will make the company prosper when the worldwide auto market recovers. "We'll be in a position to run the business at break-even or profitable at a much, much smaller industry than frankly a year ago that we ever felt would be possible to deal with," he said.

Its close competitor also did not see much cause for rejoicing. "All I can tell you is that demand is a little more robust than we expected," Ford Motor Co sales chief Jim Farley said of January sales at the show. "I would say a little, not dramatically.

(Also see: The prizewinners at the Detroit Auto Show)

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Troubled auto makers keep Detroit Auto Show flag flying