The auto industry has a thumping pulse these days and, if the New York auto show is any indication, it might beat to the tune of 14.5 million units sold in the United States this year with another 1.6-million-plus in Canada.
Conclusion: after great pain there is often great joy. And car companies from Nissan to Hyundai to Chrysler and Mercedes-Benz and more were singing Hallelujah! and Let The Good Times Roll and Happy Days Are Here Again as they waltzed across the carpet at the last major car show of the season. Oh, yes, the floor of Manhattan's Jacob Javits Centre was littered with happy and optimistic car executives standing beside an astonishing array of important vehicle debuts. A lot of shoppers are going to like a lot of this new stuff.
That, of course, will make everyone in the auto industry feel the love. It's about time. The world's auto makers have spent the last few years slashing costs to the bone, scrambling to survive not just the near-depression of 2008-2009, but also ongoing crises of a dizzying sort: earthquakes, tsunamis, floods, the threat of war in the Middle East, soaring fuel prices, the potential breakup of the Euro zone, tough new corporate-wide fuel economy regulations, and more.
While they were laying off workers, cutting wages, slashing benefits, closing plants, shifting production to more economically favourable places and finding savings everywhere, these auto makers also took care of the growth side of the business. They spent as much as possible on developing new models and many of them are ready now or soon will be – ready for the good times. In a brutally cyclical business, these companies now find themselves in the early stages of what could turn out to be an upswing lasting perhaps five years. Five juicy years, during which even the sloppiest car companies run by the dumbest car company executives – not that I'm saying any of them are actually dumb, mind you – should be able to make bags and bags of money.
I mean, in the depths of the economic crisis, new-vehicle sales in the United States dipped to 9.5 million units or so, from a high during the 2000s in the 16.5-million to 17-million range. Not surprisingly, a couple of big American auto makers went bankrupt, only to emerge – with the help of taxpayer bailouts – boasting balance sheets largely cleansed of debt and a new-found urgency to avoid repeating the mistakes that drove them into insolvency after decades of mismanagement.
It would be shocking to see any auto maker with a big North American presence go bankrupt this year – not when some forecasters are predicting U.S. sales could hit 16 million this year. True, the more careful and conservative forecasters are talking about 14.5 million, but even the most bearish keep revising their sales predictions upward. And for the first quarter of this year, sales in Canada were up 8.4 per cent and some are suggesting Canadian sales could hit a healthy 1.6 million this year.
This is why the New York show was such a joy. Celebration is way better than gloom. The past few desperate years have created the crucible for invention and creativity and now it's time to party. Optimism was on every show stand, expressed in the form of new models headed to dealer showrooms.
Take mainstream cars like the 2013 Nissan Altima and 2014 Chevrolet Impala. Both are anything but bland and boring. There is a new Viper super sports car coming from the Chrysler Group, and a new Ram pickup, too. We saw them in New York.
Meantime, Ford's Lincoln luxury brand is getting a new MKZ and promises to do even better with more new models and better customer service. Infiniti talked up an electric luxury car, Toyota showed a lovely new Avalon sedan and an even-prettier new ES 350 luxury sedan. Mercedes can't wait to get you into the new GL SUV or perhaps a new AMG model. Porsche said it will finally sell a diesel Cayenne SUV in North America.
Hyundai? The next Santa Fe will come in long and longer versions. Subaru has a new Outback, too. And if you have $279,000 (U.S.), you will soon be able to get yourself a car/plane – that's right, an airplane with folding wings that's street legal. Now that's a sign of optimism, don't you think?
Aside from the shiny new models, big and small, fast and not necessarily so furious, one car company executive stood out from the pack: Nissan Motor's savvy Carlos Ghosn, he of the seemingly boundless energy. Even though he's been at the wheel of Nissan since 1999, steering it away from bankruptcy and into the world's biggest billion-dollar commitment to electric cars, Ghosn seems to be gaining enthusiasm for his company's prospects while remaining thoroughly engaged in his transcontinental job, or jobs.
He is, after all, CEO of both Nissan and Renault. The shocking thing is, at a point in his career when most CEOs have either quit out of exhaustion or been taken out by ambitious executives who themselves want a crack at the top job, Ghosn just keeps at like a real-life version of the Energizer Bunny.
There he was on the eve of the show's press days last week, rubbing shoulders – literally – with New York Mayor Michael Bloomberg in the back seat of a canary yellow Nissan taxicab. Full production versions of the cab are destined to take to the streets of New York in late 2013. Some of us witnessing this spectacle – the billionaire mayor beside the multi-millionaire car executive – marvelled at how these two managed to fit themselves and their egos into such a relatively confined space. But then, each has good reason to feel good about himself. Bloomberg remains popular even in this third term and Ghosn's Nissan is growing fast, though its Alliance partner Renault of France is struggling mightily.
Van-like taxis are not exactly showstoppers, but Ghosn sees them as an untapped profit centre. That's why the auto maker gave its new cab the full promotional treatment: a special night away from the show, replete with gorgeous models handing out prepaid credit cards to New Yorkers. Each was worth a free cab ride in the city. The Nissan cab for the Big Apple is a specially prepared NV200 commercial van and pictures of it decorated billboards around city.
Ghosn told reporters he hopes to see the Nissan taxi in markets all around the world – from China to India to England. Wherever it's sold, a Nissan vehicle will be on display to taxi customers who might then consider buying some other Nissan model. "Six hundred thousand people a day will experience it," Ghosn said, of taxi venture.
Nissan is pushing "innovation" as its signature brand quality and to that end the cab has an interior made of anti-bacterial materials designed to neutralize odours and germs. Then there are the large roof skylights, the rear-seat reading lights, the plug-in mobile phone jacks, the separate passenger air conditioner controls and the driver-to-passenger intercom system.
"It will be the most comfortable cab in the city's history," Bloomberg declared.
Perhaps best of all, Ghosn sees the taxi as a potential EV wunderkind. He's expecting Nissan taxis will be popular as battery-powered electric vehicles.
"In my opinion, the EV will be the dominant version of the taxi," Ghosn said. "It's quieter, and that will be attractive."
Don't dismiss the EV angle here. In a speech to open the show, Ghosn stuck to his guns in the face of EV skeptics. He said Nissan has already sold about 27,000 Leafs worldwide and sales will increase when the company starts producing the Leaf EV in factories in Tennessee and the U.K. That will lower the cost of building the Leaf, which at present is built only in Japan where the strong yen is a cost penalty.
"We're going to see the cost of batteries come down quickly" as production increases, said Ghosn, predicting EVs will make up 10 per cent of global sales by 2020 where they are on the market. He said Nissan can be EV profitable sales hit 500,000 a year – say, around 2015-2016. That cab you hail in New York or London may soon be an EV, if it's a Nissan cab.
Profitable EVs? At a show filled with rosy cheeks and happy smiles based on the promise of good times ahead, Ghosn – powered by his EV vision and relentless work ethic – was surely the most upbeat of them all. That really is saying something.