Small-car sales track gas price, up and down

MICHAEL BETTENCOURT

From Thursday's Globe and Mail

Canadian auto research guru Dennis DesRosiers has compared gas price levels and entry-level vehicle sales, finding that the two correlate very closely, and not only when gas prices go up, but more surprisingly when they go down as well.

"So we have a consumer that for months and months sees fuel prices rising and the moment fuel prices do go down, if even for a month, the consumer goes out and buys a larger vehicle," wrote DesRosiers in a research note about his findings.

"It is almost as if they are waiting for lower fuel prices to justify the purchase of a larger vehicle; historical tracking doesn't seem to matter."

DesRosiers used the findings, which looked at subcompact and compact cars, as well as compact truck sales, to attack the federal government's ecoAuto feebate program, saying that the numbers made a "mockery" of the government's plan that gives consumers $1,000-2,000 rebates to buy the most fuel-efficient vehicles, while penalizing buyers of the least-efficient vehicles with a new tax of up to $4,000.

"Instead of the ill-conceived federal feebate debacle, all Ottawa had to do was increase the price of fuel," said DesRosiers.

"Everyone would have been treated fairly, it would immediately result in more entry-level vehicle purchases, and all 19 million vehicle owners might drive less."

DesRosiers has been one of the most vociferous critics of the feebate plan, although usually conservative Honda Canada has been taking out ads blasting the program while offering rebates on its Fit and some gas Honda Civic models to match it.

"I guess effective policies to address the climate change agenda are not part of any federal politician's policy portfolio," wrote DesRosiers.

Watch that warranty on a longer lease

Despite a general waning in the popularity of leasing throughout North America, it still accounted for 44 per cent of all retail new-car deals in Canada in the first five months of 2007, according to J.D. Power's dealer newsletter, the Power Information Network.

The newsletter also finds that the average lease term is 46 months, an eye-opening figure, since many basic warranties only cover up to three years of ownership. And the last thing long-term car "renters" need is to pay for repairs themselves on a vehicle that is due to be given back to the dealer in the near future.

Many buyers realize this, as shown by the long average lease length for Korean brands Kia and Hyundai of 62 months, both of which offer five-year/100,000-km powertrain warranties.

At Mitsubishi — with the longest warranty in Canada, five years of basic coverage and a 10-year/160,000-km powertrain warranty — the most popular lease term is 84-89.9 months, or between seven and seven and a half years.

Sample satellite radio on your cellphone

As goes one (XM), the other must as well — Sirius Canada announced last week that a sampling of its satellite radio channels are now available on Bell Mobility multimedia phones.

The move follows a similar deal between XM and Rogers that allows 25 satellite stations to be available on Rogers cellphones, while Telus has a deal with XM for 20 stations on its phones.

The Bell Mobility deal with Sirius provides 20 satellite channels to choose from, for a cost of $8 a month on multimedia-capable phones, which include the popular LG Chocolate, LG Fusic, Samsung m610 and Samsung a900.

Interestingly, most of these phones have an auxiliary audio-out cord, which may be able to connect with the iPod adapters now coming in many new cars .

If this is the case, it would be a low-cost way to get satellite radio in your car, as both XM and Sirius run for $14.99 a month.

Of course, with those pricier services, you get the full 100-plus channel lineups, and the ability to use your car's stereo controls instead of fidgeting with a separate unit/cellphone.

Audi RS4 run ends next year

Fresh off Audi's seventh win at the 24 Hours of Le Mans, news has come down that the 2008 model year will be the last for the Audi RS4 super sports sedan.

Despite speculation that production of the 400-hp powerhouse had already stopped, that is not the case, but there will be no 2009 RS4, Patrick Hespen, Audi's media relations and motorsport specialist, told Winding Road magazine.

Spy shots of the RS6 in final testing are circulating online, and traditionally, the ultimate "RS" performance moniker is only given to one Audi vehicle at a time. Hespen did not confirm the RS6 would replace the RS4, but did say that this policy of one RS at a time might change down the road.

Sales of the $100,000 RS4 quickly outpaced those of the similarly powerful and pricey S6 when it was introduced last year, so chances are Audi dealers are well into their 2008 allotments now.

Production may not end until next year, but given the low number of these vehicles allocated to this country, its availability in Canada may be ending soon.

Sexy billboards a safety hazard?

An Athens traffic official estimated that 10 per cent of all crashes in the city are caused by sexy but distracting advertisements, the British Guardian newspaper reports.

The statement was prompted by a civil suit of wrongful death, brought by a lawyer in Athens after his son died in a traffic accident, claiming that too many drivers are taking their eyes off the road to ogle models advertising cigarettes, perfume and cellphones.

Athanasios Tsokos is suing the city, claiming city officials of the Greek capital are responsible for ensuring the safety of its citizens and should be removing illegally placed ads.

Earlier this year, a Greek court upheld a claim from Tsokos that the government is responsible for keeping the nation's roads clear of illegal billboards, resulting in local councils being ordered to enforce the law by having them removed. Athens is estimated to have 15,000 illegal billboards — many badly erected and liable to fall down or blow away.

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