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Auto industry 'at the bottom, looking up'

The Cadillac Urban Luxury Concept (ULC) at the L.A. Auto Show in Los Angeles on November 17, 2010. The ULC has gull wing doors, a footprint of only 151 inches long and 68.1 inches wide and seats four.


Volvo CEO Stefan Jacoby was talking about his own company, but he might as well have been summing up the state of the whole auto industry: "We are at the bottom looking up.

"It means things can only get better," said the former Volkswagen executive now running the Swedish car company recently purchased from Ford by China's Zhejiang Geely Holding Group.

At the bottom looking up. It's a humbling place. And the Los Angeles Auto Show was nothing if not a showcase for car companies with a sober, practical, realistic view of the world. Just consider the products unveiled at the last big auto show of 2010 in L.A.'s downtown convention centre: hybrids and small cars and minivans and small, fuel-efficient runabouts and even an electric RAV4 from Toyota offered as a joint venture with California electric-car startup, Tesla.

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Chevrolet, to the surprise of no one, yet again rolled out its 2011 Volt electric car with the on-board gasoline charger. Except this one was covered with the grime collected along a 3,500-km journey from Detroit to L.A. General Motors, of course, wants to cast itself in the image of a down and dirty car company fighting its way back to health after emerging from bankruptcy. The dirty Volt nicely projected that image.

And being Tinsel Town, the L.A. show was not entirely lacking in glitz. Porsche had its new Cayman R and 911 GTS taking centre stage, two sexy and very fast sports cars. Lotus popped the corks on the bubbly, pouring champagne to toast five new models due to go on sale by 2013. Lotus, said company officials, reached a crossroads: either grow or die. The Malaysian owners from Proton decided to fund a product renaissance. BMW executives on hand, by the way, were impressed with the looks of the new Lotus cars.

On the whole, million-dollar concept cars were few and far between. That doesn't mean L.A. had no concepts at all. In a sign of the times, Cadillac pretty much stole the concept show with its tiny Urban Luxury Concept. The Caddy grille and wreath badge were almost as big as this little two-plus-two runabout itself. The point, said designers, is that small is the new big. Rich people in crowded urban just might buy a futuristic city car with scissor doors, touch pads and projection-screen-like readouts.

The ULC's powertrain is also a reflection of the time: a conceptual hybrid comprised of a turbocharged one-litre three-cylinder with an electric drive power boost. High-tech fuel efficiency, suggested at least some car company types, may yet emerge as feature worthy of premium pricing.

That's the hope, at least, of an industry trying to figure out how to make a profit selling "green" vehicles with expensive lightweight materials and alternative drive systems. Buick's eAssist system is another example: its mild hybrid system helps a large sedan deliver better fuel economy without adding thousands of dollars in cost. Look for it next year.

On the utterly practical side of the equation, Nissan Motor unwrapped its next-generation Quest minivan, Dodge touted its upgraded Grand Caravan minivan and Mazda showcased its Mazda5 minivan, which chief marketing officer and Mazda Canada president, Don Romano, insisted is an activity vehicle, not a minivan at all. Ford didn't have a minivan, but America president Mark Fields did point to the 2012 Focus compact going on sale in the New Year, noting it is Ford's most important introduction next year - and that car, too, is a sign of the times.

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Hyundai, too, had a small car to promote: a redesigned Elantra model also going on sale early next year. It will have a fuel-efficient, 1.8-litre engine and will be assembled at Hyundai's plant in Montgomery, Ala. John Krafcik, head of Hyundai's U.S. operations, said the Elantra will be one of four models in the company's lineup next year capable of at least 40 miles per gallon (or 5.9 litres/100 km) on the highway. As for looks, the new Elantra is designed as a smaller version of the mid-size Sonata sedan.

Fuel economy and "green" concerns were part of almost every conversation on the show floor, in fact. On display at this L.A. show were more than 50 electric, hybrid and alternative fuel vehicles, even though all these represent but a sales blip. Toyota will sell more Prius hybrids than all the other 49 combined this year in North America.

Indeed, a recent study by J.D. Power and Associates suggests hybrids and electrics will make up less than 10 per cent of the vehicle market by 2020. Nonetheless, every car maker has something green to say, even luxury brands such as Porsche and Audi, both touting the future "electrification" of high-performance and luxury cars. Porsche, for instance, was further touting its Cayenne Hybrid SUV.

Of the pure electrics, Nissan talked more about the Leaf, and Honda surprised some by showing a pure electric car just a couple of years after pooh-poohing the whole idea of a pure EV on the grounds that battery technology is years, if not decades, away from being competitive.

Now even Honda is on the battery-car bandwagon, though still cautious when the conversation turns to sales numbers. Honda, like every car company, has been cost-cutting vigorously while investing in pricey "green" technologies that may or may not sell in profitable numbers.

An auto industry at the bottom looking up, however optimistically, does not want to get too far ahead of itself predicting the future. That was L.A. in a nutshell.

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About the Author
Senior writer, Globe Drive

In 25 years of covering the auto industry, Jeremy Cato has won more than two-dozen awards, including three times being named automotive journalist of the year. Jeremy was born in Montreal and grew up in the San Francisco Bay Area. More

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