1992 Lincoln Mark Vii on 2040-cars

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Dealers mobilize to protect their margins from automaker subscription services

Six individual auto brands — Lincoln, Cadillac, Porsche, Mercedes, BMW and Volvo — have established or are trialing a vehicle subscription service in the U.S. Three third-party companies — Flexdrive, Clutch and Carma — run brand-agnostic subscription services. And three automakers — Mercedes-Benz, BMW, and General Motors — have also launched short-term rental services. Dealers, afraid of how these trends might affect their margins, are building political and lawmaking campaigns to protect their revenue streams. So far, three states are investigating automaker subscriptions, and Indiana has banned any such service until next year. It's certain that those three states are the first fronts in a long political and legal battle. Powerful dealer franchise laws mandate the existence of dealers and restrict how automakers are allowed to interact with customers to sell a vehicle. On top of that, Bob Reisner, CEO of Nassau Business Funding & Services, said, "Dealers and their associations are among the strongest political operators in many states. They as a group are difficult for state politicians to vote against." In California earlier this year, the state Assembly debated a bill with wide-ranging provisions to protect against what the California New Car Dealers Association called "inappropriate treatment of dealers by manufacturers." One of those provisions stipulated that subscription services need to go through dealers, but that item got stripped out when dealers and manufacturers agreed to discuss the matter further. In Indiana, Gov. Eric Holcomb signed a moratorium on all subscription programs by dealers or manufacturers until May 1, 2019, to give legislators more time to investigate. Dealers in New Jersey have taken their campaign to the state capitol, asking that the cars in subscription programs get a different classification for registration purposes. Automakers run the current subscription services and own the vehicles. Sign-ups and financial transactions happen online or through apps, leaving dealers to do little more than act as fulfillment centers to various degrees, with little legal recourse as to compensation amounts when they're called on to deliver or service a car. That's a bad base to build on for business owners who've sunk millions of dollars into their operations.

Lincoln cancels plan to build electric vehicle on Rivian's platform

Just three months ago, Lincoln announced a project to build a vehicle atop Rivian’s skateboard platform. Today, itÂ’s canceling those plans. Automotive News originally reported the news, and a Lincoln spokesperson confirmed it to us. Lincoln reportedly informed dealers of its decision to cancel the electric project earlier today, citing the “current environment.” Language like that these days in the automotive industry refers to the coronavirus pandemic and flailing vehicle sales. Originally, Lincoln announced that this model would launch in 2022. It was to be built using the same platform underpinning the Rivian R1S and R1T. The partnership with Rivian was so close that this Lincoln was going to be built at RivianÂ’s Normal, IL assembly plant. Production of the plant itself was halted recently in the face of the coronavirus, which is bad news for any products meant to be built there in the near future. Lincoln never announced that this vehicle was going to be an SUV, but that was the likely result of it using RivianÂ’s platform designed for rugged and large utility vehicles. However, Lincoln says it still has plans to build an electric vehicle. The companyÂ’s statement follows: “Given the current environment, Lincoln and Rivian have decided not to pursue the development of a fully electric vehicle based on RivianÂ’s skateboard platform. Our strategic commitment to Lincoln, Rivian and electrification remains unchanged and LincolnÂ’s future plans will include an all-electric vehicle consistent with its Quiet Flight DNA.” Lincoln hasnÂ’t specified any product details or timing for when this mystery electric vehicle will launch. It could be based off the Mustang Mach-E platform, or it could be a larger vehicle based off the future electric F-150 platform. The former could launch sooner, while the latter is likely a little ways out still. Lincoln doesnÂ’t want this news to be read as a loosening of ties between itself and Rivian either. “Our partnership with Rivian is strong,” LincolnÂ’s statement reads. “While the Lincoln electric vehicle did not turn out to be the right opportunity, we continue to work closely together with Rivian. Our strategic commitment remains unchanged and we will continue to work with Rivian on an alternative vehicle based on RivianÂ’s skateboard platform.” As of now, Lincoln hasnÂ’t revealed exactly what didnÂ’t line up to make the planned collaboration work.

Genesis cars win accolades, offer value — so why are sales so bad?

My high-school buddy Brent Cormier was so smitten with the Genesis G80 when he saw it at an event I hosted at SXSW in 2016 he bought a used 2013 Hyundai Genesis a short time later and fell in love with the car. "It surpasses my every expectation," said Cormier, a self-described "renaissance man" who owns and runs a real estate agency with his wife Laura, is a food service executive chef and part owner of Austin-based Thin the Herd Guitars. "I was locked into Mercedes and Audi for 10 years," he added. "And felt trapped in an endless pit of maintenance costs." After owning the Genesis over the past two years — including using it as an Uber and Lyft driver to earn extra cash — Cormier learned what some frugal luxury sedan buyers and a handful of car reviewers have discovered: Genesis offers great bang for the buck compared to other premium brands and can compete with the best in terms of performance, features and comfort. Hyundai's luxury brand also earned a prominent third-party endorsement last week when for the first time Genesis topped J.D. Power's 2018 APEAL study, surpassing German luxury-performance icon Porsche. The APEAL study (which stands for Automotive Performance, Execution and Layout) "measures owners' emotional attachment and level of excitement across 77 attributes," ranging from performance to comfort, and asks nearly 68,000 owners of new 2018 models to score vehicles on a 1,000-point scale. In its second year ranked as a stand-alone brand, Genesis earned an APEAL score that bumped it up 15 points to 884 and helped push it past Porsche — and past BMW, Lincoln, Mercedes-Benz, Audi, Volvo, Cadillac, Land Rover and Lexus, in order of ranking. Last month, Genesis also topped J.D. Power's Initial Quality Survey (IQS) for the first time this year. And both its models were awarded Top Safety Pick Plus ratings by the Insurance Institute for Highway Safety, among 11 Plus ratings in all for Korean vehicles. Despite high J.D. Power rankings and great reviews, Genesis U.S. sales were off 50 percent for the first six months of 2018 compared to 2017, and in June Genesis sold only 796 vehicles — the first time U.S. numbers dropped below 1,000 in a month. Part of Genesis's APEAL and IQS success can be attributed to its small product lineup: just two models, the G80 and G90 sedans, with a third, the 2019 G70, launching later this year. And while those numbers may help in J.D.