Resilience and the auto industry went hand-in-glove in 2012 as automakers plumped up their bottom lines, ladled on luxury features in new models and turned their once-battered fortunes on their heads.Nothing seemingly could blunt the industry’s momentum. Hiring soared at plants around the U.S. Some added third shifts, worker overtime and even six-day workweeks to meet the demand for vehicles.
Oil prices surged, and gas prices topped an average $3.90 a gallon, though they never reached the July 2008, record of $4.11 a gallon. Yet, vehicle sales remained strong.
Even when Superstorm Sandy lopped off October’s sales by tearing through the East Coast, it blew new life into November’s tally. Buyers were willing to pay more, as well.
The average transaction price for all vehicles — what people actually paid for a new car at dealerships — hit a record $30,700 in March, TrueCar.com says. It still hovers above $30,000.
The year was marked by high-profile departures. American Suzuki Motor announced that it’s going to stop selling cars in the U.S. Saab all but died in bankruptcy but was resurrected when National Electric Vehicle Sweden, a Chinese company, bought its assets to turn it into an electric car company.
Ferdinand Porsche, designer of the signature Porsche 911 sports coupe and descendant of the founder of the automotive giant, died.
America lost its own design and racing icon, Carroll Shelby, creator of the Shelby Cobra and the Shelby Mustang. The legendary Shelby, a key figure in the automotive industry for more than five decades, became synonymous with high-performance machines.
Against that backdrop, here are the year’s top automotive stories as picked by USA TODAY editors and reporters:
1. The auto industry stages a comeback. Wow, what a year. The auto industry came clawing back with the highest sales since 2007.
After an expected strong showing this month, the industry is on track to sell 14.5 million new vehicles this year, says analyst Brian Johnson of Barclays in a note to investors. That would be an impressive 13.5 per cent increase from last year.
Even more remarkable is how the industry has steadily churned more sales since the depths of the recession in 2009, when sales bottomed at 10.4 million. If the industry can keep its momentum, it could get back to 16 million in 2013, which would be on par with the banner years of a decade ago.
2. The auto industry takes centre stage in the presidential contest. President Obama’s decision to bail out General Motors and Chrysler during their darkest hours figured large in his re-election victory over former Massachusetts governor Mitt Romney.
Obama used the bailout to pound away at GOP nominee Romney in the Rust Belt, especially Michigan and northern Ohio, where Detroit automakers have unionized factories.
Though Romney was born in Detroit to a former Michigan governor who had run American Motors, he was hampered by a 2008 op-ed he wrote for The New York Times headlined, “Let Detroit Go Bankrupt.” Since no Republican has made it to the White House without Ohio, it was considered pivotal to Obama’s re-election. Obama won Ohio with 50.7(per cent) of the vote, compared with Romney’s 47.7(per cent).
3. Hybrids go mainstream. In the past, motorists have associated the greenest of cars with distinctive designs that sometimes sacrificed performance or comfort, such as Honda’s original Insight or an early Toyota Prius. Now, hybrids have gone mainstream, with big sales expected. A 2013 Toyota Camry hybrid averages 41 miles a gallon. Ford Fusion hybrid is rated at 47 mpg, not far off the 50 mpg of a 2013 Prius (although the Environmental Protection Agency is reviewing that Fusion figure). Automakers need to bring hybrids to their mainstream cars to meet a new corporate average gas mileage standard of 35.5 mpg by 2016.
4. Ford’s CEO picks a successor. Talk about big shoes to fill. No CEO has made a bigger, more longer-lasting impact on a Detroit automaker in recent years than Alan Mulally, who arrived from Boeing in 2006. He shepherded Ford through the recession and avoided the bankruptcy reorganizations that both General Motors and Chrysler undertook.
Ford had a particularly strong bench of executives to eventually succeed Mulally, but the folksy Kansan named Mark Fields — the head of the automaker’s operations for North and South America — as his heir apparent. Fields, who took over this month as chief operating officer, is best known for turning around Japan’s Mazda when it was under Ford’s control.
5. 40 miles a gallon? Instead of styling or features, automakers in 2012 had to deal with a world in which buyers cared most about how much mileage a car could squeeze out of every gallon. But where do you set the bar in a way that impresses would-be customers?
Hyundai found it when it marketed its new Elantra compact as getting 40 miles a gallon in highway driving. Suddenly, competitors were forced to try to match the easy-to-remember number, usually with editions that added special gas-savings. Honda went after it with special editions of the Civic, Ford with the Focus and Chevrolet with the Cruze.
The irony? Under pressure from the EPA, Hyundai had to revise its gas-mileage figures on several models and lost the ability to claim 40 mpg.
6. Recalls that stung. Automakers loathe recalls, which are not only expensive but embarrassing. In terms of sheer numbers, it appeared that the year would end with about as many as 2011. But some stung worse than others.
Ford, after touting the wonders of its 1.6-liter EcoBoost turbocharged engines, had to recall 89,153 Fusion sedans and Escape crossovers earlier this month because of an overheating issue that could lead to fires. All appeared to end well since the problem could be fixed with a software update.
7. Toyota and Honda resurrected. Both saw their sales slammed by the March 2011 earthquake and tsunami in Japan, then flooding in Thailand.
This year, with factories repaired and the supply pipeline back to normal, sales jumped in the U.S. Toyota sold 28.8 per cent more vehicles through November of this year, vs. the same period a year ago, Autodata says. For Honda, the gain was 23.8 per cent. Toyota is likely to be the world’s best-selling automaker.
8. Design’s slippery slope. Hearts were aflutter a couple of years back when Jaguar unveiled its XJ, and Audi showed off the A7. Both sedans had a similar shape, the gently sloping roofline of a fastback that gave them the racy looks of a coupe.
In 2012, the style became the de facto industry standard, as mainstream makers followed. The new Chevrolet Impala gets the same treatment, along with Toyota Avalon and the Mazda6. The slope is gorgeous but not always practical. Not only can it eat into rear-seat headroom, but it makes the trunk appear smaller.
9. Michigan becomes a right-to-work state. For the labour union movement, no state has been more important than Michigan, home to UAW and thousands employed making cars. The number of Michigan workers represented by a union fell from 27(per cent) in 1990 to 18(per cent) in 2011, the Detroit Free Press reports.
Union influence has declined as Detroit automakers shut down plants while foreign makers, both European and Asian, opened non-union plants mostly in the South. Unions vow to put Michigan firmly back in the union column.
10. Goodbye “Government Motors.” The Treasury Department announced earlier this month that it will sell all of its remaining 500 million shares of General Motors in the next 12 to 15 months, ending the $49.5 billion bailout that kept the nation’s largest automaker alive.
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