US automakers introduce more products

NEW YORK: Automakers seem to be a little frantic these days. At this season’s major auto shows in Detroit, Chicago, Geneva and New York, they offered vehicles powered by diesel fuel, hybrid systems and ethanol, massive pickups and tiny subcompacts, nostalgic muscle cars and futuristic crossovers.

Finding the right formula to whet car buyers’ appetites has become more essential than ever. Automakers are responding with more products to fill every niche, which is a boon for consumers but painful and expensive for US automakers.

High gasoline prices also intensify the risks for General Motors Corp and Ford Motor Co, whose operating profits come primarily from less-fuel-efficient pickup trucks and sport utility vehicles. “There’s a lot of things GM and Ford are still grappling with if they’re going to adapt to these niche markets,” said Erich Merkle, the director of forecasting for the consulting firm IRN Inc.

In a recent speech, Ford’s US President Mark Fields said there will be 300 nameplates in the US market by the end of the decade, up from 215 in 2002. The explosion is apparent at the auto shows.

In Detroit alone, 33 vehicles made their worldwide debuts. Japanese and South Korean automakers are well equipped to make many different models because they have lower labour costs and newer, more flexible plants that can build multiple products on the same line.

Ford and GM are working on making their operations leaner, by cutting thousands of jobs, closing plants, and using the same underpinnings on multiple vehicles, but it will take time before they can match the level of their rivals.

Fields said this past week that Ford expects 82 per cent of its assembly facilities to be flexible by 2008, up from 38 per cent in 2004.

At the New York show last week, Hyundai Motor Co launched its seventh totally redesigned product in 24 months.

Against a backdrop of high gas prices, fuel-saving technologies were big at this year’s shows. Jim Sanfilippo, a senior industry analyst with Michigan-based Automotive Marketing Consultants Inc, said the hybrid-electric system on the new Lexus LS600h is one of the most advanced inventions he has ever seen.

In Detroit, Ford rolled out a diesel-electric hybrid concept that it says can achieve 65 miles per gallon.

Mercedes-Benz promoted its Bluetec diesel engine, which will meet emissions regulations in all 50 US states once ultra-low-sulphur diesel comes on the market this fall.

At the Chicago show, GM and Ford announced plans to convert more fuel pumps to ethanol and educate the owners of the 6 million ethanol-capable vehicles on the road about the benefits of the fuel, which contains only 15 per cent gasoline.

Honda unveiled an Element concept redesigned for urban drivers, with larger tires and a carpeted interior.

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