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Average Auto Loan Rate Continues to Fall

Jun 8th, 2010 by Liz

The Federal Reserve’s data shows that the average auto loan interest rate on new car loans at auto finance companies in April was 4.13 percent.

April’s rate follows several previous months of a rate decline, SubPrime Auto Finance News reports. In March, the national average car loan rate was 4.28 percent and in February it was 4.72 percent.

The Federal Reserve also found that the average auto loan length in April was 62.8 months, or 5.23 years, which is the same as in March. In February, the average length of car loans was 62.5 months.

The loan-to-value ratio, or the amount of the auto loan compared to what the car is worth, was 88 in April, for the second consecutive month. In February, SubPrime Auto Finance News reports that it was slightly higher at 89.

The average amount that consumers financed for new car purchases fell slightly to $27,797 in April, compared with $27,912 in March and $28,040 in February.

Although the average auto loan rate continues to drop, once the economy improves, it will most likely go up. So if you plan on buying a car in the near future, take advantage of the record-low car loan rates by buying soon.

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Chrysler Announces New Recalls, 600,000 Vehicles Affected

Jun 7th, 2010 by Liz

Chrysler announced Friday it is recalling about 25,000 model year 2007 Dodge Caliber and Jeep Compass vehicles due to sticky gas pedals. Now the Detroit automaker has two more recalls, and almost 600,000 vehicles total are affected.

The recalls involve five models in the United States, Reuters reports. Chrysler informed the U.S. National Highway Traffic Safety Administration of the potential safety issues last week.

Dodge Grand Caravan

About 284,831 Chrysler Town and Country and Dodge Grand Caravan (pictured above) minivans for model years 2008 and 2009 are affected by the recall. The minivans could develop a problem in the electrical system that could cause a short circuit in the latch for the sliding door, which could cause a fire.

About 288,968 Jeep Wranglers from model years 2007 to 2010 could experience leaking brake fluid which could cause brake failure.

These two new recalls are in addition to Friday’s recall for about 25,000 Dodge Caliber and Jeep Compass vehicles with potential sticky gas pedals. The affected accelerator pedals were made by the same manufacturer as the ones involved in Toyota’s recall, but the underlying problem is reportedly unrelated.

Owners of the recalled vehicles will be notified by Chrysler this month and the automaker will fix the vehicles free of charge.

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Chrysler Recalling Caliber and Compass For Sticky Accelerator Pedals

Jun 4th, 2010 by Liz

Chrysler is recalling about 25,000 model year 2007 Dodge Caliber and Jeep Compass vehicles due to sticky gas pedals. In the affected vehicles, part of the gas pedal assembly can fall off, causing the pedal to come out of alignment and become stuck, CNNMoney.com reports.

CTS Corp., the supplier that made Toyota’s problem accelerator pedals, also made these Dodge and Jeep pedals. The problem that causes the pedals to stick is reportedly unrelated.

Dodge Caliber

Dodge Caliber

The NHTSA started investigating the pedals in early May after five consumer complaints. In four of the cases, a mechanical part of the gas pedal was found on the floor of the vehicle.

Both the Caliber and Compass have brake override systems, which automatically cuts engine power when the brake pedal is pressed, even if the gas pedal is also pressed. This makes the vehicle easier to control if the gas pedal becomes stuck.

Chrysler said it doesn’t know of any accidents or injuries related to the problem. The automaker said it will notify owners of the affected vehicles and replace the gas pedal assembly free of charge. Only some Calibers from the 2007 model year will potentially have the problem. Owners can call Chrysler at 1-800-853-1403 or the NHTSA at 1-888-327-4236.

Jeep Compass

Jeep Compass

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Chevrolet Gives Detroit Tigers’ Galarraga New Corvette

Jun 3rd, 2010 by Liz

Armando Galarraga, pitcher for the Detroit Tigers, is all over the news headlines today, thanks to a bad call by an umpire who ultimately ruined Galarraga’s perfect game.

Galarraga shouldn’t be sad though. Chevrolet just gave him a brand new 2010 Corvette convertible, saying they wanted to recognize his outstanding performance on and off the field.

Chevrolet Corvette

GM North American President Mark Reuss, who presented the red Corvette to Galarraga at Thursday’s game against the Cleveland Indians, said the way the pitcher had handled the incredible events deserved to be recognized regardless of what record books would ultimately show.

General Motors is a sponsor of the Tigers and Reuss said he had known the owners of the team, the Ilitch family, his whole life, saying they have always been a supporter of GM.

“It is only fitting we help give back for all the Ilitches have done for Detroit and to celebrate Armando’s pitching and sportsmanship during one of the most captivating evenings in Tigers history,” Chevrolet said in a statement.

Galarraga retired 26 consecutive Cleveland Indians batters during Wednesday night’s game. After the 27th batter was called safe instead of out at first base after a hit, Galarraga’s perfect game was blown. The shiny, new, red Corvette should put him in a better mood.

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Ford Ending Mercury Production in Fourth Quarter

Jun 2nd, 2010 by Liz

Ford announced Wednesday it will end production of its Mercury brand in the fourth quarter of this year, and will expand and enhance its Lincoln brand with seven all-new or significantly refreshed vehicles in the next four years.

Ford said in a statement it is discontinuing its Mercury brand “to fully devote its financial, product development, production and marketing, sales and service resources toward further growing its core Ford brand while enhancing the Lincoln brand.”

Mercury Milan

Say goodbye to the Mercury brand, which will end production in the fourth quarter.

“We have made tremendous progress on profitably growing the Ford brand during the past few years,” said Mark Fields, Ford’s president of The Americas. “Now, it is time to do the same for Lincoln. The new Lincoln vehicles will transform luxury for North American premium customers through an unexpected blend of responsive driving enjoyment and warm, inviting comfort.”

Ford said it wants Lincoln to compete with Cadillac and Lexus in North America.

“Profitably growing Lincoln in North America is an important part of our One Ford plan,” said Alan Mulally, Ford president and CEO. “Our Ford brand is gaining momentum and winning customers around the world. Now, we are going to use the same laser focus to further strengthen Lincoln and deliver even more products luxury customers really want and value.”

Mercury sales account for 0.8 percent of Ford Motor Company’s 16 percent market share in the U.S. Ford said since there are no stand-alone Mercury dealerships in North America, it will help dealers maintain stand-alone Lincoln or Ford-Lincoln dealers.

Current Mercury owners will still have access to parts and service at Ford and Lincoln dealers. All current warranties will also still be honored, including Ford’s Extended Service Plans.

Ford also announced special offers on new Mercury vehicles that will be available through the summer to support the sell down of current Mercury inventory and remaining Mercury vehicle production. Yes, this means you should be able to get a fantastic deal on a Mercury vehicle right now.

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Floor Mats Could Get Stuck Under Gas Pedal in Ford and Mercury Cars

Jun 1st, 2010 by Liz

The National Highway Transportation Safety Administration is warning owners of 2010 Ford Fusion and Mercury Milan sedans there could be a problem with all-weather floor mats becoming stuck under accelerator pedals. The gas pedal could become stuck if the all-weather floor mats are stacked on top of the cars’ standard carpeted mats, CNNMoney.com reports.

“Any Ford ‘All Weather’ optional floor mat should be placed in the driver’s side foot well only after first unfastening and removing the standard, carpeted floor mat,” the NHTSA said in a statement Friday. “This is the only way to ensure that the ‘All Weather’ optional floor mat is physically secured to the floor.”

Ford Fusion

This warning is very similar to the Toyota recall last fall for a similar problem. Toyota’s recall of about five million vehicles was spurred by a family who was killed when their rental Lexus’ all-weather floor mat became lodged under the accelerator pedal and the driver could not stop the car, which sped out of control, crashed and burst into flames.

The NHTSA has reportedly received three complaints about gas pedals becoming stuck when an all-weather mat moved forward on the Ford and Mercury vehicles. There haven’t been any injuries or crashed related to the three complaints. The NHTSA is opening a formal investigation into the problem.

The Ford Fusion (above) and Mercury Milan (below) are sister cars. The Lincoln MKZ, also a sister car of the Fusion and Milan, was not included in the all-weather mat warning.

Mercury Milan

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The Auto Run-Down

May 28th, 2010 by Liz

Ford is planning to wind down the Mercury brand, created in 1939 by Edsel Ford, after sales plunged 74 percent since 2000, said two people familiar with the plan. Exactly when Mercury will die depends on how fast Ford executives can convince Mercury dealers, who also sell Lincoln vehicles, to close or merge with Ford showrooms.

“Mercury is a forgotten brand,” said John Wolkonowicz, an auto analyst with IHS Global Insight in Lexington, Mass. “Many Americans probably already think it has been discontinued. Mercury was too similar to Ford from the very beginning.” (Bloomberg)

More automakers are offering 0 percent auto loan financing to help close deals with customers, saying that lower auto loan payments are a more powerful sales tool than cash back and other incentives. Low and zero percent auto loan rates don’t lower the vehicle’s projected resale value. But only buyers with good credit scores are the ones who will be approved for 0 percent financing deals. (USA Today)

Forbes has found America’s most overpriced vehicles. The magazine looked at market price figures from April, which is the price that a buyer actually pays for a vehicle. Forbes also used 2010 customer-satisfaction information from Consumer Reports to better determine whether certain vehicles meet the expectations their brands promise and whether they justify their sticker price. Every vehicle that made the list was from an American brand, except two from Nissan. The list will help you when negotiating the price if you plan on buying any of the vehicles on Forbes’ list. (Forbes)

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Honda Has the Best Customer and Quality Commitment

May 27th, 2010 by Liz

Honda is perceived to be the best in customer and quality commitment, according to a recent survey by Consumer Reports.

Among seven major automotive brands, Ford ranked second, followed by Nissan, Chevrolet, Toyota, Hyundai and Chrysler.

Honda Accord coupe

Honda Accord Coupe

Consumer Reports conducted a telephone survey of more than 1,700 adults whose household owns at least one vehicle. The magazine wanted to see how consumers’ perception of a brand’s commitment to customers and quality has changed in the midst of Toyota’s recall crisis.

Percentage of survey respondents who said a brand was committed to the customer or quality:

BRAND/CUSTOMER COMMITMENT/QUALITY COMMITMENT

Honda / 71% / 73%

Ford / 62 / 65

Nissan / 57 / 58

Chevrolet / 56 / 56

Toyota / 53 / 52

Hyundai / 44 / 42

Chrysler / 36 / 38

Chevrolet beat Toyota? This is surprising to us, because even though Toyota is still in the middle of trying to repair its image and fix the PR nightmare the safety recalls have created, most Toyota owners still love the brand. Chevrolet has some new models and a new advertising campaign about the quality of its vehicles, but most people we talk to still aren’t convinced GM is on par with its foreign competitors yet.

Honda taking the number one spot really isn’t a shocker. Honda has long had a reputation for making reliable, yet somewhat boring, vehicles.

We’re surprised Hyundai didn’t rank higher in this survey. Hyundai’s new models have been a huge hit, especially the 2011 Sonata, which was recently named a Top Safety Pick by the Insurance Institute for Highway Safety.

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Mercedes-Benz Financial to Use iPad in Auto Loan Process

May 26th, 2010 by Liz

Mercedes-Benz Financial is giving its dealers Apple iPads to help move the auto loan process out of the finance manager’s office and onto the showroom floor, and to speed-up transactions. Mercedes-Benz Financial says it is one of the first companies to adapt the consumer-oriented iPad as a mobile business tool.

MB Advantage, which is Mercedes-Benz’s point-of-sale dealer system, will be used on the iPads, allowing salespeople to look-up incentives and rebates for specific models and make the lease return process faster. Using the program on the iPad will also result in a faster turnaround time on the credit application process, Mercedes-Benz says.

MB iPad

“We see the iPad providing wireless mobility, information and flexibility on the showroom floor,” said Andreas Hinrichs, VP of marketing for Mercedes-Benz Financial, in a statement. “The iPad will provide a competitive advantage to our dealers by increasing their service levels through a more flexible financing process.”

Mercedes-Benz Financial is giving 40 dealers throughout the country the iPads so they can test it as a business tool. Mercedes-Benz Financial customers can also make their car loan or lease payments through the company’s iPhone app, which came out last October.

Image via Mercedes-Benz Financial.

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Nissan Leaf Sells Out Before Hitting Dealerships

May 25th, 2010 by Liz

Nissan CEO Carlos Ghosn said the automaker has completely sold out of its new all-electric vehicle, the Nissan Leaf.

“We think there is a big future for this car,” Ghosn said. “I can already tell you that the production for 2010 is already sold out.”

Nissan has received 13,000 orders for the Leaf in the U.S., which is scheduled to hit dealerships in December, The Detroit Free Press reports. The U.S. was only slated to receive 13,000 Leafs. Deposits for pre-orders were only $99.

Why is the all-electric Nissan Leaf so popular? It’s affordable. The base SV model will cost $32,780 and a higher trim level would be $33,720. This is before a $7,500 federal tax credit though, dropping the prices to $25,280 and $26,220.

Nissan says the Leaf can travel 100 miles on a single battery charge, and has a top speed of 90 mph. The Leaf’s lithium-ion battery pack will take about eight hours to charge on a 220-volt outlet or 20 hours on a 110-volt outlet. Nissan said it will take less than 30 minutes to charge about 80 percent using 480-volt charging stations, which Nissan expects will be available across the U.S. in the future.

The 2010 Nissan Leaf will go on sale in December in the Washington, Oregon, California, Tennessee and Arizona markets. Good luck finding one.

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