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Thursday, November 16, 2006 

Vol. 2 No. 33

Did the End of “Small Cars” Mark the Continual Loss of Market Share for the Domestics in the Last Thirty Years?

Okay, so the last dozen entries or so have been describing industry events over the last few months, I thought it was time for lighter prose stimulated by an article I read recently in the trade newspaper read by all car guys, Automotive News. In his September 18th editorial, “Bring Back Model Cars, A Prime Sales Too,” journalist Rick Kranz identified something which cleared up a long standing mystery to me since I was way too young to drive (or even read), while at the same time it provoked broader thoughts in me and others (judging from the letters it provoked a few weeks later). It turns out every year at new model introduction time, from the mid-fifties through about 1970 or so, the domestic manufacturers (people only talked of the domestic manufacturers back then) used to produce and distribute plastic scale model cars, called miniatures, to stimulate sales and interest in new car purchases. These were detailed limited edition, 1/25 scale plastic replicas of the real thing, a little more than half a foot long, some with details including the real car's special features listed or molded into the plastic chassis, such as, “galvanized rocker panels” or “36,000 between chassis lubes.”

Much Like Fast Food Chains Hook Kids Today...
I think the domestics hit on a promotional idea way before its time, if the ubiquitous fast food industry “give-aways”are any indication of a successful marketing trend. Specifically, if a company creates a cool promotional piece for the “next generation,” it seems to me that this somehow always seems to benefit current and future sales. Parents stop into the store to grab these promotional items for their kids, and, in so doing, the seller creates current and future product awareness. All vehicle manufacturers recognize this, I think, as Jennifer Saranow's article in the Wall Street Journal just last week (Nov. 9th), entitled, “This is the Car I Want, Mommy,” does a good job highlighting all the things to hook kids too young to drive, to in turn, hook adults - from exclusive features on Saturday morning cartoons, to younger kids gym placements, to ironically, McDonald's Happy Meal model “give-aways” - a good idea whose time has come...back?

Kranz in his article quite rightly points out that the universal problem for marketers today is in “grabbing and holding” the attention of potential vehicle buyers in magazine or print ads, and that's where the enthusiasm for the interactivity of Internet promotion, if used correctly, comes into play. Now I am, of course, one of the biggest endorsers of the benefits of using the Internet in selling new and used vehicles (naturally), but there is something to be said for the old fashioned “touch and feel” give-away, especially when that giveaway seems as inviting as the scale model of a new vehicle.

Truth be Told...
I remember seeing a playing with quite a few of these plastic scale model cars as a child (yes, that far back). I vaguely remember someone telling me that they came from car dealers, not from the toy store, but I never really knew the story behind them until I read Mr. Kranz's piece in Automotive News. So maybe the effect of these scale models was truly dramatic, after all, I ended up hooked in the car business and it is true that around domestic manufacturers have pretty much lost total market share every year since they abandoned this very direct marketing approach. But there is hope, I just read, also, in a recent issue of Automotive News, that GM's Chevrolet, Pontiac, Hummer and GMC vehicles play title characters in the new “Transformers” movie coming out next summer - maybe this will spark direct vehicle give-aways once again, and boost market share.

And on a Different Note, Farewell to an Automotive Legend...
Ford Taurus was the #2 Selling Car, just Behind the Model “T”

It began production on December 26, 1985 (not too long before I first entered the car business), a very new and very different car from standard offerings at the time, styled by Jack Telnack. Now, the Ford Taurus, 21 years and 7,519,000 cars later (estimated total production by Automotive News), just ended its production run. Along the way the car created Detroit sales history: It was the best selling car in the United States from 1992 through 1996 and it was the best selling domestic car from 1989 through 2003. Automotive News estimates that it alone generated $135 billion in sales for Ford. Most importantly, in my mind anyway, it was proof that, foreign competition ”perceived” quality superiority, public appeal, exchange rate advantages, etc. aside, that if the domestics produced a quality, popular car, the American public would respond accordingly - to me success in the car business for manufacturers has always been “the product, stupid” and the Ford Taurus is evidence of that assertion.

Yes, of course I owned one in its day, and I can also personally attest to the fact it was a very safe car to drive, which, indeed, may have been part of its appeal. I hit a slick road on a dangerous highway once and skidded head long right into the dreaded New Jersey Turnpike concrete divider (made famous with a cross section on display at the Disney World Epcot Test Track ride displaying the divider's car crushing strength), I totaled the Taurus but personally walked away with barely a scratch. So a personal thanks to an excellent car, that, well, had a more than excellent legendary market run and public reception.

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