By Brendan Moore
Internet auto retail pioneer Autobytel, which has turned a profit in only two of the eleven years it has been a publicly traded company, announced in a press release two days ago that it has posted a loss for yet another quarter.
The company lost $970,000 USD in the last quarter of 2009, which is a big improvement over the same quarter in 2008, in which they lost $15.1 million, but still not what most people would consider a good result.
Except, of course, to anyone but their CEO, Jeffrey Coats, who says the fact that they are losing less per quarter is concrete evidence of a turnaround in progress.
The press release from Autobytel, in which Coats is quoted, states that: “Several important metrics, including gross profit, and the significant reduction in the company’s net loss, exceeded our expectations in the 2009 fourth quarter,” said Jeffrey H. Coats, President and Chief Executive Officer. “By returning to our core auto lead generation business and taking significant steps to ensure that we are operating as efficiently as possible, we have made significant headway toward achieving profitability.”
“One of the most substantial improvements we’ve made during the past year is generating more leads directly from our websites. Not only has this lessened our dependence on third party lead providers and reduced our cost base, but has allowed us to post our highest quarterly gross margin since the second quarter of 2007,” Coats said.
By Chris Haak
Overnight, we had yet another snowstorm in the Mid-Atlantic region. When I woke up this morning, I looked outside and saw that heavy winds had blown most of the snow off of my driveway and the 2010 Infiniti FX50 Sport that I’m reviewing this week. The office opened on time this morning, so I decided to venture out into the unknown for the 26 mile drive to work. Knowing that I had a fallback – remote access – if conditions turned out to be too poor, there was no pressure on me to make it the whole way into the office.
But alas, I had a trump card. The kind folks who delivered the FX50 to me earlier in the week slapped a set of low-profile Bridgestone Blizzak snow tires onto its 21 inch rims. It’s always comforting to receive a car during the winter – particularly when snow is expected – that has the appropriate tires mounted to it. When I took an Acura TL SH-AWD 6MT on a several hundred mile road trip last month that included considerable portions of bad weather, it was not equipped with snow tires. In fact, it didn’t have all-seasons – it had summer tires. That’s not far from the notion of wearing flip-flops to shovel snow.
Odds and ends about cars and the car business
By Brendan Moore
TOYOTA has started offering subvented leases on many of its models in an effort to keep sales numbers up during the recall crisis. The most common methodology used in a subvented lease is when the lessor, in this case, Toyota Financial, Toyota’s captive finance unit, assigns a higher residual to the vehicle than it actually has, in order to drive the lease payment downward. When lessors subvent a lease, they typically artificially bump up the residual value of the vehicle leased, or, lower the lease finance rates, or, lower the FICO credit scores needed in order to be approved for the lease. Faced with increasing amounts of unsold inventory, Toyota appears to be employing all three methods of subvention simultaneously on their captive (through Toyota Financial) leases, making a lease on a new 2010 Toyota very inexpensive. If you are in the market for a Toyota product, and also want to lease, this is very much a magic moment in time. Just as a general FYI, this sort of thing happens with the captive lease companies with regularity, no matter which brand you’re shopping, but particularly with the high-line brands. The luxury brands would much rather offer you a subvented lease where you can’t see all the discounting that takes place as opposed to giving you a $5000 rebate.
By Chris Haak
In almost every car that we review here at Techshake, a common theme is often that the car would be even better with more power. A Dodge Challenger R/T with a 5.7 liter Hemi is good. A Dodge Challenger SRT8 with a 6.1 liter Hemi is very good. So it stands to reason that a Mazda3s Grand Touring – a very good car that is, in my opinion, the best car in its class – would be lights-out awesome if it had more power. Say about 100 more horsepower. And let’s throw in larger brakes, larger tires, better steering, and firmer suspension while we’re at it. So is a Mazda3 with all of those enhancements (including the enhancement of adding a “Speed” to its name) a better car?
In some ways, yes, but in other ways, it’s a little too rough around the edges. Maybe I’m just getting old as I am about to enter the second half of my fourth decade, but I actually preferred the regular Mazda3s with its 2.5 liter four cylinder to the MazdaSpeed3.
By Brendan Moore
As we noted a couple of hours ago in an update to Storm Clouds Gather over Hummer Acquisition, the deal to sell Hummer to Tengzhong of China for $150 million USD has been declared dead.
“Tengzhong worked earnestly to achieve an acquisition that it believed to be a tremendous opportunity to acquire a global brand at an attractive price,” Tengzhong said in its statement. “The renewed investment to be made by Tengzhong and other investors would have provided Hummer’s existing management team the ability to build greener utility vehicles that would have been attractive and useful in new markets such as China as well as the existing core markets.”
Sichuan Tengzhong Heavy Industrial Machines Co. Ltd. just wasn’t able to convince the Chinese authorities that buying a specialty SUV-pickup manufacturer was a good idea. The Chinese regulators, according to their public statements, never actually received an application from Tengzhong; the company apparently saw the handwriting on the wall from the informal talks they had with the regulatory agencies in China, and just gave up.
In what had to be considered “Plan B”, there had been some brave talk about getting external financing and managing the new venture from outside the country, but it was not to be, as it seems potential finance sources shied away from the business concept as well.