Not the Microbus Volkswagen of America Needs

Volkswagen unveiled the electric-powered Bulli concept at the Geneva Auto Salon last week. The buzz on this side of the pond is that the new-age Microbus that America has been awaiting since the first New Beetle is finally here. VW’s North American chief, Jonathan Browning, has said he’d love to have a T1/Microbus-style minivan to sell here.

Browning needs all the North American-friendly product he can get. Wolfsburg has charged him with the goal of selling 800,000 Volkswagens in the United States by 2018. Last year, VW sold just under 257,000 vehicles, fewer than either Subaru, the Honda Accord or Toyota Camry. Browning’s first shots at the goal are the cheaper, decontented 2011 Jetta and Tennessee-built 2012 Passat.

Bulli, even with an internal combustion engine replacing the concept’s electric motor, is no Jetta or Passat. If sold here, it would fit in with other lower-volume, Euro-centric VWs already sold here like the Golf, CC and Touareg. What Browning needs, for volume, is a minivan with the Bulli’s styling stretched over the new, 110.4-inch wheelbase Passat’s large midsize platform. VW of America needs a Microbus roughly the size of the concept shown here at the 2001 Detroit auto show. That one used the T5 platform.

With two rows of fold-down bench seats, the Bulli is ostensibly a six-seater. Really, it’s more of a four-seater, for young couples or people with dogs, instead of kids. The seats fold down 50/50 front and back, and the rear windows roll down on conventional (not sliding) doors. There’s very little rear cargo space.

The Bulli, if sold here, would compete with the Soul, of which Kia sold 67,000 last year, or the Fit, of which Honda sold 54k. A good, Microbus-style Routan replacement would have to compete with the Honda Odyssey (108k in ’10), Toyota Sienna (98k) and the Chrysler twins (about 215k, combined) to be a significant contributor to VW’s ’18 goal.

VW’s Bulli is smaller than the Kia Soul. It’s about 4.6 inches shorter overall, on a 2.7-inch longer wheelbase. It’s about 1.4 inches narrower than the Soul, though three-and-a-half inches taller. It’s designed for the European market, not ours, unless and until gasoline hits $5 per gallon and stays there. It’s maybe closer in size to the Ford B-Max, which isn’t going to be imported here.

Bulli’s styling is encouraging, though; a good, modern interpretation of the vans that used to follow The Grateful Dead from concert to concert.

If VW can stretch the Bulli’s design language onto the North American Passat platform, and maybe add half a dozen small windows in the roof, they might have the kind of minivan that would draw consumers who need minivans for the space, but hate them anyway.

I’m sure Browning is pushing for exactly that kind of Routan replacement. That, and a three-row, $30,000 crossover/utility also off the Passat platform. I mean, c’mon; we are Americans, after all.

As Gas Prices Rise, Toyota's Hybrid Sales Pass 3 Million

As Gas Prices Rise, Toyota's Hybrid Sales Pass 3 Million  

Sales ofToyota's (TM) gas-electric hybrid vehicles have passed3 millionunits worldwide, according to Nikkei Business and several other media accounts. The company's Prius, the first mass-produced hybrid car, was introduced in Japan in 1997 and launched in the U.S. in 2001.

Most major car companies have introduced hybrids of their own, but there is no evidence that any of these models have come close to matching thePriusin units sold. By way of comparison, about 12 million cars and light trucks will be sold in the U.S. this year. In China, the world's largest car market, sales should be about 14 million.

Automoblogsummed up the success of the Prius: "As expected, the Toyota Prius makes up the lion's share of the brand's hybrid sales. Accounting for 72% of the world sales of Toyota hybrid vehicles, three generations of the Prius popularity is set to gain more product diversity this year when the Prius V and aplug-in hybridversion arrive for sale."

The Prius's success contrasts with early attempts to market electronic cars. The Prius has the advantage of a price comparable to gas-powered cars. Mostelectric carmodels cost more than gas-powered cars of the same size and passenger capacity. There are also concerns about how far an electric car will go without a charge. Auto industry research firm JD Power recently reported that electric car sales will be very slow for the next few years and will only account for 7.3% of all light vehicles sold in 2020.

Toyota's recall andearningsproblems, which began 14 months ago, hurt both the company's sales and reputation. But neither seems to have undermined the ongoing rise of the Prius as the dominant alternative energy car in the world.

The Three Worst Things You Can Say to an Auto Lender

Heading to the car lot to pick out a new ride can be a lot of fun. Talking to the auto lender, however, can feel a bit like a hostage negotiation. After all, you're trying to get the best car you can get for the best price, while the dealer simply wants to make as much money off you as possible.

And unless your bottom line is truly bottomless, you don't want to leave the lot knowing that something else in the budget -- like groceries -- will have to be sacrificed in order to afford that new, monthly car payment.

So before you go car shopping, be forewarned. These are the three worst things you can say to an auto lender.

1. "I can afford to pay $X dollars per month."

Bad idea, as we've mentioned before on WalletPop.

Granted, it seems logical that you would tell an auto lender what you can afford to pay. Why on Earth wouldn't you tell them how much you afford to spend each month on your car?

Because, says Jimmy Williamson, a member of the National CPA Financial Literacy Commission, "lenders and car dealers will then hit you with a loan paid out over 72 months or longer at exorbitant interest rates. Instead, negotiate the best cash price for the car before you even mention monthly payments or terms."

There are other factors you should be thinking about beyond your monthly payment, according to Gary Pierce, general manager for the auto division atLendingTree.com. "It's important to also look at the total cost of the vehicle, the interest rate and the cost of borrowing over the life of the loan," Pierce says.

Another reason not to quote a price that you're comfortable paying every month is that the car salesman will likely get you to nudge yourself to a higher price, says Phil Reed, the senior consumer advice editor at Edmunds.com.

Reed worked as a car salesman for several years, and when he was being trained, he says he was taught that if a customer said they were comfortable paying $400 a month, the salesperson should say, "$400 up to ... ?"

The consumer would then likely stammer and say, "Hmm ... $450."

"So you've already gotten them to negotiate with themselves," Reed says. "They've agreed to pay $450, and then the salesperson comes back and says, 'Well, we couldn't do $450, but we can do $475.' That sort of thing goes on all the time."

So how do you avoid talking about what monthly payment you can afford? "What we always recommend is that you get pre-approved for a loan before you walk into a dealership, even if you're possibly going to borrow from the dealership," says Reed. "If you can walk in there and say that you have pre-approved financing, that you don't want to talk about the monthly payment, and that you only want to talk about the price of the car, you've completely disabled their main tactic."

What's more, you're more likely to get a better deal because once you're in the room with the finance guy, he'll ask about the interest rate you've been pre-approved for, Reed says, and quite possibly the conversation will go like this:

Finance manager: What's the rate you're approved for?
You: Six percent.
Finance manager: I can offer you 4.5%. Are you interested?

And that, says Reed, is when you say, "Of course, I'm interested."

2. "I've had a few financial problems, but my credit is okay."

Hey, what's the problem? You're just being honest and preparing the salesman for whatever they're already going to see on your credit report, right?

It would seem so, but Reed says that car salesmen is likely to adopt a position of, "Your credit is weak, and I'm going to help you out." As Reed explains, "Immediately, the consumer feels as if this guy is trying to help them out, and so they can't bargain with them."

But there is plenty of room to bargain, from the interest rate to the extended warranty -- should you decide you want one -- to the add-ons that the dealership will try to get you to purchase. But from the moment the salesman is "helping" you and doing you a favor, you can pretty much be guaranteed he's going to do you no favor at all.

3. "I don't care how you do it, just get me into a car."

"That's exactly what the people at the car dealership want to hear," says Reed, "and believe me, they'll do everything they can to get you into a car."

If you make the comment as soon as you arrive on the lot, you're pretty much saying you've already given up. And if you make the comment in the middle or near the end of the negotiation, the dealer knows just how desperate you are. By admitting you want them to do anything to get you into a new car, you've signaled that you're willing to take whatever they can offer you.

But if you're really that desperate, you should probably stick to either buying a car through the Internet, or at least bringing in a friend or relative to help you negotiate.

"They have a name for those customers," Reed says of the consumer who waves the white flag. "Salespeople will come into the back office and say, 'He was a 'get me done' sale."

And while you may not have a lot of room to maneuver -- "Your credit score will usher in the final decision, and there's only so much tap dancing you can do," Reed says -- you certainly don't want to take a weak position from the beginning.

BMW Aims For Cars to Take E-mail Dictation

BMW has developed a prototype system that allows drivers to compose full-text e-mails and text messages using voice commands. Unlike voice-activation options in existing BMWs, the technology relies on speech-recognition algorithms that offer drivers, as well as passengers, freedom to dictate original messages from over a million recognized words in the database.

he main novelty is that you can compose e-mails with the same ease of use that you would have with a PC in an office setting--without taking your eyes off of the road or using your hands. You respond to e-mail by dictating out loud what you want to say while using voice commands for editing functions, such as deleting, moving, or replacing text. For millions of workers who otherwise waste a large percentage of their time driving every day, being able to send and receive e-mails safely while commuting would represent an obvious boost in productivity.

The system, which could be sold as an option in production models within three years, as part of the company's plans to develop voice-activated commands to operate any function that drivers must otherwise activate today by hand. For example, the German luxury carmaker expects eventually to allow drivers to enter search queries on the Internet and to hear search results read out loud by using voice commands as well.

Does it look like he's working?BMW's voice-to-text e-mail technology complements options that BMW already offers. With BMW's ConnectedDrive, for example, you can connect your Blackberry to the dashboard console with a Bluetooth connection and the audio system reads e-mail or text messages out loud as you drive. When the car is not in motion, it is possible read the full texts of the e-mails from a Blackberry inbox on the car's dashboard screen. For the iPhone, BMW will offer an app with which drivers can open and lock their car remotely.

Other carmakers are seeking to widen their in-car communications options as well, of course. In the mainstream car sector, Ford's Sync infotainment system allows for selected smartphone applications to run on a dashboard console. With Ford's MyFord Touch for Sync, drivers can select routes for GPS-guided navigation and music. Ford also plans for Sync to read e-mail and text messages out loud and to allow drivers to dictate messages in three to five years time, although it has not yet demonstrated a prototype that does this like BMW has.

GM says it is developing a voice communications app for Android mobile phones that will let drivers send and receive text messages and Facebook updates using only their voices. GM said it plans to offer the system with its OnStar in-car system and service during the first half of the year and will offer the compatible smart phone apps through Android Market.

A main issue with any of these technologies is safety, of course. In theory, anybody can type and receive e-mails in their car with an Android, Blackberry, iPhone, or other smartphone while driving.

But in case it is not already apparent; texting, e-mailing, or even talking on the phone while holding the device to your ear is extremely dangerous, distracted-driving behavior. Distracted driving was involved in the deaths of 5474 people and 448,000 injuries in car or motorcycle crashes on U.S. roads and streets, according to the National Center for Statistics and Analysis.

In the best-case scenario, technology that allows for hands-free e-mailing and using other office applications in the car may save lives while allowing you to continue to work while driving. It is also likely that driver distractions may one day become irrelevant in the not-so-distant future, when and if cars drive themselves as many futurists expect them to.

However, in the meantime, I remain cautiously skeptical that even voice-to-text e-mailing and texting is totally safe, so I look forward to in-depth studies to clarify just how safe or unsafe it is.

Ford Continues Short-Term Lease Deals

Ford Continues Short-Term Lease Deals

Ford is continuing its auto lease deals in March, as well as low and 0 percent auto loan rates on 2010, 2011 and 2012 vehicles and cash back incentives.


Certain remaining 2010 Ford vehicles are being offered with 0 percent auto loan financing in March. Cash rebates are also available on leftover 2010 Ford vehicles for shoppers who prefer to finance through their bank or credit union or pay cash.


Select 2011 Ford models have low car loan rates of 0 to 6.9 percent, depending on the vehicle and length of the loan. In lieu of the low auto loan rates, Ford is also offering customer cash on select 2011 models this month. Some of Ford's commercial vehicles have higher auto loan rate deals than the regular retail offers.

The 2011 Ford Fusion can be purchased with interest-free financing for five years with $1,000 in trade-in cash in March.

A couple 2011 Ford vehicles have 0 percent auto loan rates for 60 months, plus $1,000 in trade-in assistance bonus cash. This offer is good on the 2011 Ford Escape and Fusion.


The 2012 Ford Mustang is available with 1.9 percent financing for 36 months, 2.9 percent for 48 months, 3.9 percent for 60 months and 5.9 percent for 72 months in March.


Auto lease deals are available for two years on nine Ford vehicles in March. The 2011 Ford Edge, Escape,Flex, Explorer, F-150, Fiesta, Fusion, Mustang and Taurus are all included. At less than $200 a month, shoppers can lease the Fiesta and Fusion. The Edge, Escape and Mustang are available in the $200 to $300 a month range. The Flex, Explorer, F-150 and Taurus all fall into the $300 to $359 a month range. You'll need anywhere from $1,829 to $3,878 at lease signing, depending on the vehicle.


Incentives listed are for the southeast region. They may differ depending on where you live. Check Ford's site to find the incentives in your area.

Court Ruling Says Cheaper Insurance Deals Based on Gender Are Illegal

Insurers shouldn’t be allowed to take gender into consideration when calculating premiums, the European Union’s highest court said in a ruling that is likely to increase the price of insurance for women.

The present system “works against the achievement of the objective of equal treatment” for men and women and should end by the end of next year, the EU Court of Justice, the 27-nation region’s top court, ruled today.

Auto insurance premiums for female drivers could rise as much as 50 percent as a result of the ruling, according to KPMG LLP. It will also result in insurers changing the way they market policies and assess risks to ensure they get “only the better performing female business,” the accounting and consulting firm said.

The ruling “flies in the face of common sense” and is “completely disadvantageous to the very people it was intended to protect,” said Adrian Brown, chief executive of London-based RSA Insurance Group Plc, the U.K.’s biggest non-life insurer by market value. “Consumers are going to have to pay the price for an illogical change in the law.”

Decisions by the Luxembourg-based tribunal are binding and can’t be appealed. An existing EU equality law, introduced in 2004, allows the region’s countries to differentiate between men and women when calculating insurance premiums if data shows “sex is a determining factor in the assessment of risk.”

‘Bad News’

Michaela Koller, director general of the European insurance and reinsurance federation, CEA, said today’s ruling was “bad news.”

“Europe-wide the effect on the price and benefits and on the choice of insurance products for consumers could be significant,” she said. Insurers “will now face significant additional costs in reassessing data, transforming premiums and changing terms and conditions and marketing materials.”

“Young female drivers pay less for motor insurance because they are less likely to have accidents and therefore women make fewer claims than men,” the Association of British Insurers said in a statement. “For life insurance, women on average pay less to reflect their longer life expectancy, while pension income for males is often higher because men typically have fewer years in retirement.”

Sheilas’ Wheels, owned by privately held Esure Insurance Ltd., and Diamond, owned by Admiral Group Plc, are the U.K.’s two biggest women-focused car insurers. Sheila’s Wheels, which also offers handbag insurance, will comply with the ruling while continuing to target women drivers, spokesman Adrian Webb said.

Most Males

“Sheilas’ Wheels has always insured men but most males simply aren’t attracted to our brand and we don’t see this changing,” said Webb.

Admiral said in an e-mailed statement it would use the transition period to introduce a “gender-neutral pricing structure.”

Admiral climbed 19 pence, or 1.1 percent, to 1,708 pence in London trading.

“It’s as wrong to treat the same things differently as it is wrong to treat different things the same way,” said Markus Riess, the head of the German unit of Allianz SE, Europe’s biggest insurer, at a conference in Munich today. “It’s to be expected this will make insurance more expensive.”

Statements that insurance will become more expensive are “plain wrong,” said German insurance customer group, Bund der Versicherten.

‘Won’t Rise’

“Since claims won’t increase with unisex premiums, one or the other person may end up paying a little more, but overall the average premiums won’t rise,” said Hartmuth Wrocklage, head of the BdV. “If premiums overall rose, it would serve only to increase profit, not to balance out supposed costs of the unisex premiums.”

The European Commission, the EU’s executive agency, said it was “an important moment forgender equality” in the region.

Viviane Reding, the EU’s justice commissioner, said she will meet with insurance industry officials to discuss the ruling.

According to research by Oxera last year that was commissioned by the ABI, the British insurers’ group, women younger than 25 could see their auto insurance costs rise by an average 25 percent and life insurance costs could increase by as much as 20 percent, while men could see a drop of 10 percent.

Statistical Analysis

There are insurers who have “years and years’ worth of insurance policies,” written with gender in mind, said Philip Jarvis, a partner at law firm Allen & Overy LLP in London.

“Insurers will no longer be able to rely on statistical analysis to discriminate between men and women for the purpose of pricing products,” said Jarvis. “The economic effect will presumably be that these costs will have to be rebalanced.”

Companies will have to find another way of more accurately pricing the risk of an individual life, such as based on lifestyle or health, said Jarvis.

“It will be crucial to ensure this news does not put people off having vital insurance,” said Maggie Craig, ABI’s acting director general.

Belgian consumer group Test-Achats in 2008 challenged the country’s law implementing the EU rule. Belgium’s Constitutional Court a year later referred the case to the EU tribunal, arguing it had to establish whether the derogation in the region-wide law underlying all national laws was valid or not.

The consumer group in an e-mailed statement said it was a “victory for consumers, the men and women” of the EU.

The case is: C-236/09, Association Belge des Consommateurs Test-Achats and Others.