Next victim of mortgage mess: Auto sales

Rising concern about home values and mortgage payments is causing more buyers to slam the brakes on new car purchases.

Already-battered U.S. auto sales could be the next victim of the problems with mortgages, declining home and stock prices as potential car buyers delay purchases due to uncertainty.

Industrywide U.S. auto sales in August could be off 10 percent from a year ago, according to an early read from sales tracker Edmunds.com. That follows July sales that were 19 percent below year-earlier levels

Jesse Toprak, executive director of industry analysis for Edmunds.com, said that the downturn in home values and credit issues that were seen in the July numbers could be an even bigger factor this month.

"I think the issue is becoming more pronounced," he said.

Sales weren't just weak at domestic automakers, such as General Motors, Ford Motor and Chrysler Group. Year-over-year sales fell in July at Toyota Motor and Honda Motor as well. Many forecasters are cutting full-year auto sales targets in the face of these weak summer sales. And some experts say the turmoil in housing could throw even more dirt in the gears.

CNW Research, which specializes in surveys of car buyers, found in its latest reading that 13.6 percent of the potential market's customers were canceling or postponing plans to make a new-vehicle acquisition any time soon, up from 10.1 percent last year.

And of those postponing or canceling plans, home-related issues jumped to the No. 1 reason, cited by 17.6 percent of those staying away from dealers' showrooms, with nearly 11 percent of that group citing a decline in their home equity and another 6 percent citing an increase in their monthly home payment.

Of those postponing purchases, 10.7 percent cited problems with credit scores, as some sources of car loans are tightening lending standards. Gas prices are a distant third, cited by less than 5 percent of those delaying purchases.

"We're probably going to see some pretty bad [auto sales] numbers for the rest of the year," said Art Spinella, president of CNW. "To put it simply, housing is now the major hurdle to new car purchases. The next three to four months are not going to be much better if it's better at all. People are not interested in buying a new vehicle."

Only two years ago, the CNW survey found just 2.3 percent citing home-related issues as a reason to postpone a car purchase, while 5 percent cited credit score problems and about 3 percent cited gas prices.

Automakers, led by GM, are upping cash-back offers and other inducements to try to breathe life into sales in the face of headlines about home foreclosures and market meltdowns.

GM spokesman John McDonald said that GM isn't seeing any sharp drop-off in sales it can trace to the current mortgage and housing slowdown.

"It is one of a number of headwinds," he said. "There's fuel prices, there's interest rates and there's housing prices. But we're not seeing anything new that we've not been talking about for more than a year."

But one auto industry executive, who spoke on condition that his name not be used, said that the higher incentive spending by automakers, particularly on GM pickups, may mask some of the bite that housing is putting on sales.

"The home was not only a source of financing for some car purchases, it contributes to a positive feeling psychologically," said the executive. "That led to a confident outlook, a view that 'I can go ahead and spend from paycheck to paycheck and buy new cars when I want to because the value of my home and portfolio have gone up.'

"It's silliness to say the credit crunch doesn't matter," said the executive. "If the final sales numbers for August have any strength, it will be because of incentives."

Current Auto Rates
36 month new: 6.82%
48 month new: 6.94%
60 month new: 6.94%
72 month new: 7.01%
36 month used: 7.40%

Experts in the field say that car purchases are one of the first items that consumers can and will put off if they are nervous about their own financial outlook, long before they'll cut back on eating out or other discretionary purchases.

Bob Schnorbus, chief economist for auto research firm J.D. Power & Associates, said that the August sales probably won't tell the full story about the drag that the housing turmoil is causing for auto sales.

"I wouldn't expect it to have that quick impact; I would expect it to be more of a drag throughout the rest of this year than a plummet in August," he said.

And Schnorbus said that while consumers may keep making other types of purchases, even as they pull back from buying new cars and trucks, the slowdown could spread to other types of spending in the future if the market does not improve.

"A new car is one of the more postponable purchases that people make," said Schnorbus. "That new vehicle purchase could be a good leading indicator if consumers are going to cut back. Over the next few months, we could be getting some very interesting signals."
(C)CNN

Shopping Advice: Buy a Car, Pick It Up in Europe

European delivery programs aren't just a glorified vacation: many offer discounts on new vehicles and attractive travel packages.

Many European car manufacturers offer special programs that allow buyers to purchase a vehicle at a dealer in the U.S., pick it up at the factory in Europe, drive it around and then drop it off at a designated port for shipment back to the U.S.

Often called "European delivery programs," some, like Saab's, provide as much as a 9 percent discount off of a vehicle's manufacturer suggested retail price (MSRP), as well as airfare to and accommodations near the factory where it's picked up. More elaborate travel packages are usually available for purchase and can be a good value. The car companies handle all of the complicated details, such as insuring the vehicle for driving in Europe and arranging its shipment back to the U.S. So drivers are free to enjoy their new vehicle while exploring Europe.

These money-saving trips are often an insider’s secret, one of those things that you need to know about to ask about. That’s because this ultimate option often lurks below dealers’ radars despite the wildly enthusiastic responses from owners who participate.

“They love the program, they love going to the factory,” says Anne Doris Korallus who is the European delivery order administrator for Mercedes-Benz. “Even if they’re not a car enthusiast, they go on the factory tour, and it’s like an elves workshop; it’s so fascinating to watch how a car is built. They come out bubbling over.”

The European delivery programs are a chance for Americans to drive their cars as they were designed to be driven, flat-out on the Autobahn; or above the Arctic Circle. That’s where Saab takes some customers for snow and ice training, as well as quality time behind a team of sled dogs. Or it’s a way to celebrate an anniversary or do some mother-daughter bonding while getting what James Hope of Volvo Cars N.A. calls “friendly” rates at hotels the company recommends.

The hitch is that you forgo the instant gratification of driving home with your dream car the same day you go down to the dealership.

No matter which brand you prefer, Audi, BMW, Mercedes-Benz, Porsche, Saab or Volvo (more on the English absence in a bit), the procedure is pretty much the same.

Go to your local dealer, select the model you want — it must be one regularly available in the United States — configure it to your specifications and order it. Prices are preset and usually slightly discounted from the MSRP. Payment and financing options are the same as for regular delivery. The dealer will tell you when your car will be ready at the factory.

Book flights. Plan your itinerary, coordinating with the manufacturer to ensure you take the best routes for some great drives. Pick up an international drivers license at the nearest AAA office.

Fly to Europe. Enjoy some hospitality from the manufacturer, usually a minimum of transportation from the airport, one night in a hotel near the factory, a meal and a factory visit.

Take delivery of your car. It will have temporary insurance that is often renewable so you can extend your stay, export registration and plates.

Explore Europe in your own car being careful not to exceed the maximum time limit that you can use the car there without being taxed, usually three to six months. You must also pay attention to where you can go; the offered insurance coverage may have geographical restrictions.

Drop off your car at one of many predetermined locations for shipping to the United States. Be sure to read the fine print on this because there may be extra charges at certain locations.

Pick up your car at your dealership several weeks after you return from Europe.

The biggest challenge may be finding a salesperson at your local dealership who knows about the program.

“If a retailer is supportive, you might see a poster” about the program, says Volvo’s Hope. “That’s why we get a lot of repeat customers, they’ve done it before. Or when they were buying a car in the past they saw the poster and then do it when they buy a new car.”

The programs, started between 30 and 40 years ago, were conceived as a sales enticement. At the time, European cars seemed exotic, if not downright odd, to most Americans. “The first Saab we bought was from a friend whose husband had died,” says Seth Bengelsdorf of Port Chester, N.Y. “My father felt bad for her because she had the snow tires on the wrong wheels, in front.”

That was in the late '60s when front-wheel-drive was unknown and theirs was the only Saab in town. By the summer of 1971, the family was in England, taking delivery of a new Saab for a driving vacation that included a ferry trip to Europe. Since then, it’s been all Saabs for all Bengelsdorfs almost all the time.

Such loyalty is not just a Saab quirk. At Mercedes-Benz, Korallus has tracked customers who’ve used the program 30 times since its inception. Audi revived its program in 2006, so great was customer demand, much of it from previous participants. And they want more, so Audi is expanding its post-pick-up touring offerings with the help of Abercrombie & Kent, a company known for arranging luxurious, individualized travel. Even Porsche, which doesn’t discount prices for European delivery, finds repeat customers are a significant percentage of program participants.

Mike Strada, of Kailua on the Hawaiian island of O’ahu, has taken European delivery of a silver Porsche 911 Carrera Coupe every year since 2001. He takes delivery in May, having signed up for the Porsche Grand Tour program that puts him on the racetrack in a Porsche 911 Turbo, or a Boxster S with a professional driver who will “redline from zero to 160 mph, and slow down to 120 mph on the turns,” Strada says.

He started this routine after a divorce, figuring a month of Porsche-ing about Europe with his son would be a good 24/7 experience for them. Strada keeps the car at his home in Bellagio, Italy, on Lake Como through the summer, then returns to drive it for another month in Europe each fall before shipping it home. He manages to squeak out under the deadline for paying what amounts to a failure-to-export penalty.

Porsche handles all the details of getting the 911 Carrera Coupe to Hawaii, and each year, Strada sells last year’s model to make room for the new baby next to his daily driver, a Toyota Tacoma.

Perhaps only a Mini driver could be so loyal, which brings us to the lack of an English delivery option for Mini Cooper owners. Judging by online howls, they want this option the way a pre-schooler wants a puppy — passionately and right now. Given Mini’s innovative marketing and owner programs, what gives?

Common sense.

For American drivers, “it’s a challenge to drive on the right-hand side even with a right-hand side drive car,” says Andrew Cutler of Mini USA. With a car designed for American roads, which would be left-hand drive “it’s kooky-crazy. The last thing we would want is for somebody to come pick up their brand new baby” … here, Cutler pauses, letting images of dented, crumpled Minis slouch through the imagination. The possibility of owner injury is too great a horror to contemplate.

Gamely, the company has tried a Mini-holiday program where owners would tour the factory, then rent a Mini for scooting about the landscape. It never achieved what Cutler calls “critical mass.” There have been discussions of installing mini-cams in the factory, so customers could watch their car being built from afar. So far, no go.

But Mini is not alone in not offering an English delivery option. Jaguar doesn’t. Neither does Land Rover. However, Land Rover compensates somewhat by welcoming American owners who want to "get their mud on" into its intensive driver training courses throughout the United Kingdom. Use of the vehicles is included in the enrollment fee. You can take much the same classes at home throughout North America.

Keep reading for a guide to the most popular European delivery programs or scroll to the top and click on a brand that interests you.

If you want to buy a super luxury car or an exotic, check with your dealer. As a Ferrari spokesman said, “The simple answer is 'no,' but things can be arranged on an exceptional basis.”
(C)Forbes

Are Model-Year Closeouts a Good Buy?

Depending on your tastes and needs, buying an outgoing model just before it's replaced by a new one can be a good deal. But holding out for newer versions has its own rewards.

It’s not exactly Christmas come early, but automakers have gotten a flying start this year on model-year blowouts. At dealerships around the country, 2007 models are being hustled off the lots to make room for the incoming 2008s.

In particular, Honda and Toyota are trying to attract customers with higher-than-usual discounts offered seemingly earlier than ever, well in advance of the typical model-year clearance events. Honda’s average incentive per vehicle sold in July was $1,146, versus only $896 in July 2006, according to Edmunds.com. Toyota’s average incentive per vehicle hit $1,492 in July, up from $1,009 a year earlier.

Vehicle incentives can vary. They aren’t always just money off the sticker price. Import brands like Honda often prefer to offer discounts in the form of cut-rate leases, as opposed to customer cash rebates, which have been popular with domestic manufacturers. “We don’t offer cash at all, as a matter of policy,” said Honda spokesman Chris Naughton. That’s partly to avoid the appearance of a fire sale, but also because, according to registration data from the automotive research company R.L. Polk & Co., leasing is more popular on both coasts, where import brands sell the best. In the Midwest, people are less likely to lease or buy imports.

Through Sept. 4, Honda is offering a $199 per month lease for 36 months on the 2007 Accord four-cylinder coupe, with $2,399 due at signing, according to Honda’s website. That's the leasing equivalent of almost $3,000 off sticker price. Acura is also offering cut-rate leases or low-interest financing.

The fine print for the Accord lease puts the MSRP at $21,870, and the net capitalized cost is $18,895.89. The latter is the leasing equivalent of the amount financed on a loan, i.e., the amount of money borrowed.

Buyers can negotiate with dealers on the difference of $2,974.11, which would typically include things like a down payment, first month’s payment and acquisition fee, Honda's Naughton said. But the unspoken suggestion is that dealers are highly motivated to get people into the $199 lease.

Uncharacteristically, Toyota is also offering leases as low as $199 on the 2007 Camry. Luxury import brands including Infiniti, Lexus and Mercedes-Benz are likewise advertising “summer specials,” which often last until it’s time for model-year clearance sales, which themselves then segue into December clearance events.

In other words, with 2008 models on the horizon, and deals to be had on 2007s, it’s a good time to be a car buyer. The question is, what’s the better deal, buying the last of the '07s or the first of the '08s? It turns out, there’s no wrong answer; both have advantages, depending on your tastes and needs. Keep reading to find out the benefits of buying either the last of an outgoing model or the latest introductions.

Reasons to Buy an Outgoing Model

Price
Without a doubt, outgoing models are going to be less expensive. Discounts on most 2007 models should reach a peak in the summer and early fall, based on historical data from Edmunds.com and Bandon, Ore.-based CNW Marketing Research. Once new models arrive, dealers will want to quickly sell any remaining '07 inventory so that they can charge full price on new '08 models. It’s much harder to get buyers to pony up full price on the latest vehicles with the outgoing ones sitting on the lot, especially if they look just like the new ones. The more old models dealers can move out, the better their chances to make more money selling the new ones.

“A year ago, [Toyota] had a new Camry and a new FJ Cruiser. Margins hit a real sweet spot,” said Earl Hesterberg, president and CEO of Houston-based Group 1 Automotive Inc., the fourth-largest U.S. dealer chain. That is, the 2007 Camry was newly redesigned, and the FJ Cruiser was a completely new model, with no previous model to stagnate on the lot. From the dealer’s point of view, this “sweet spot” meant charging their customers top dollar, and getting it.

Styling
If an “old” model was redesigned recently, like the Camry in 2007, it’s unlikely that the new model will look all that different. It may have been tweaked in some ways, but, for the most part, opting for the old model doesn’t mean sacrificing much, styling-wise. In the end, you can save a bundle on a car you like to look at.

In fact, although redesigned models are often touted for their groundbreaking designs, sometimes people actually prefer the styling of an existing model, simply because they’re used to it. At first glance, a reworked model can seem over-designed, and even radical compared to the vehicle it’s replacing. And not necessarily radical in a good way. For instance, BMW has toned down the supposedly controversial styling of its 7 Series, which was redesigned in 2002, a possible sign that customers were turned off by the new look.

Availability
Because new or redesigned models are often more sought-after, they can be hard to come by, meaning customers may have to get in line to buy one. With outgoing models, this isn’t a concern. In fact, outgoing models are often a little too available, which is another reason dealers want to move them. Here’s how it works: Dealers borrow money to pay for the cars that sit on their lots. For every day that the cars sit unsold, they accrue more of what the industry calls “floor plan” interest charges. According to the National Automobile Dealers Association, rising interest rates meant that dealers paid an average of about $160 in floor-plan costs for every vehicle they sold in 2006, roughly double the year before. Thus, dealerships want fewer cars on their lots because it means they are spending less money.

Toyota is calling its summer promotion “Lots on the Lots,” a name that suggests Toyota dealers have too much inventory. This is good for potential car buyers, but not so good for Toyota. In fact, it’s symptomatic of larger problems. “Import inventories are higher than we would like, mostly because of softer sales for Honda and Toyota,” said David Cosper, CFO for Sonic Automotive Inc., Charlotte, N.C., the nation’s third-biggest dealership chain. Toyota Division reported that its sales dropped 3.5 percent in July, compared to the same month one year ago. Honda Division said it slipped 1.2 percent in July.

Reasons to Hold Out for a New Model

No matter how rational the reasons for buying an outgoing model may be, some people just can’t resist being the first on their block with the latest car. This decision doesn’t have to be purely emotional — solid arguments can be made for holding out for the newest models, even if they cost more.

Redesigns
A “redesign” is the industry term for an all-new model with the same name as the old model, and it’s probably one of the top reasons that people choose upcoming models. For example, the 2008 Honda Accord will be an all-new model, with new styling and new features, if we believe the concept car sneak peek at the New York International Auto Show. (See the Accord Coupe concept in our 2007 Detroit Auto Show coverage.) Honda says that the new Accord is much more aggressively styled and designed for better crash safety and improved gas mileage. If the hype holds true, then buying a new model means getting a better car.

Resale Value
Simply put, newer vehicles are worth more. For lease customers, it’s especially important to select a car with the best possible residual value, which is the car’s predicted value at the end of the lease based on its depreciation over time. When leasing, the customer is essentially borrowing the difference between the upfront cost and the residual.

According to historical data from Automotive Lease Guide, Santa Barbara, Calif., a widely used residual value benchmark, residual values are best when a model is new, and likely to fall when a model is replaced, or about to be replaced, with an all-new model. Lease numbers then could be a little bit better on the newer model. However, some dealers will occasionally offset the lower value of an outgoing model with a lease discount.

Patience
As usual, dealers will be hesitant to sell below the manufacturer suggested retail price (MSRP) at the start of any model year. But before long, the 2008s are likely to be on sale, too. Edmunds.com said that as of Aug. 1, Mini is the only brand in the industry offering virtually no incentives. In addition, luxury import brands tend to have their biggest discounts in December, when they are trying to hit their calendar-year sales targets. At that point, when the new-model buzz has died down, it’s quite possible to get that new vehicle for less.

Based on historical data from Edmunds.com and CNW Marketing Research, clearance sales usually start closer to the traditional model-year changeover, in September and October. Honda won’t introduce the all-new Accord until October, but it has already started discounting the 2007 model late in the second quarter. “Dealers are pushing an aggressive target” for Accord sales, said Roger Penske, chairman of the Penske Automotive Group in Bloomfield Hills, Mich., the nation’s second-largest dealership chain.
(C)Forbes

What does "Hybrid" mean?

"Hybrid" doesn't mean just one thing. Cars and SUVs can be set up in different ways to meet different needs. Here's a look at the various systems.

The hybrid menu
Hybrid gasoline/electric vehicles are often lumped into one, all-inclusive catagory. People will say "I'm thinking of buying a hybrid" without thinking about which model or type.
The fact is, hybrid vehicles vary enormously. It's not just that some are SUVs and some are cars. Their hybrid powertrains, themselves, can differ greatly in their design and programming. (Computer software has a lot to do with how a hybrid works.)

Right now, Toyota is the unchallenged hybrid leader. The Toyota Prius is the best selling hybrid by far, accounting for more than half of all the vehicles sold.

Toyota's "full hybrid" system is also used in Nissan's Altima Hybrid, and it's the same technology used in the Ford Escape and Mercury Mariner Hybrid SUVs.

General Motors, long seen as a laggard in hybrid technology, now has three types of hybrid systems on tap.

One, commonly called a "mild hybrid" system, is on the market now. Another, the "two-mode" hybrid system, will be introduced in the fall. A third "series hybrid" plug-in electric vehicle, is on the path to production, but no specific timetable is set.

Full Hybrid
Toyota Prius - the vehicle that most readily comes to mind when someone says "hybrid" is the Prius. It's a good car in many respects: The Prius has the interior space of a midsized Camry in a smaller package.
It's a "full hybrid:" in that it can run on its electric motor alone for short distances at low speeds.

The Prius was designed, from the outset, to be a gasoline/electric hybrid vehicle. That enabled designers to create the body around the hybrid system rather than cramming batteries and an electric motor into a body designed to house just a gas tank and an engine. For that reason, the Prius has plenty of usable storage space.

With its unique body design, it's also instantly recognizable as a high-tech hybrid car, which only increases its appeal.

Mild hybrid
The Saturn Aura Green Line vehicles, the Aura sedan and Vue SUV, are "mild hybrids," in which the electric motor provides assistance to the gasoline engine but lacks the power to drive the vehicle on its own.
Fuel is saved by shutting the gasoline engine down altogether whenever the vehicle comes to a full stop.

Also, since the electric is there to provide additional thrust, the gasoline engine doesn't need to be as large. (The Aura Green Line, for instance, has a 4-cylinder engine where non-hybrid versions have V6's.)

The advantages of a system like this are cost and size. The system requires little alteration to the basic engine and transmission layout so that it costs much less to manufacture than a complex "full hybrid" system.

Also, since electricity needs are lower, the system requires only a small battery pack which, again, saves on costs, but also saves weight and space. Other hybrid sedans, such as the Nissan Maxima and Toyota Camry Hybrids, lose trunk space to make room for batteries.

The downsides are that the system's impact on fuel economy is relatively small while the drag on driving performance is sizable.

When not boosting performance, the Green Line electric motor/generator remains fully engaged, acting like an anchor bogging the car down whenever the gas pedal isn't being pressed.

Performance hybrid
The Lexus LS600h offers the performance of a V12 with the fuel economy of a V8, Toyota boasts.
Compared to those cars, the Lexus looks downright thrifty. Not only does it get better fuel economy - it even costs a lot less. The V12-powered BMW 760li gets 15 mpg and costs about $20,000 more. The Lexus gets 21 mpg.

And the LS's performance really is impressive. Step on the gas and the 600 horsepower engine pushes you back in your seat with an easy whisper, barely straining as the needle on the electric boost gauge moves into "performance" territory.

Toyota doesn't expect to sell very many of these cars. Market experience shows that hybrid shoppers are mostly interested in one thing: burning as little fuel as possible. High-end luxury hybrid buyers represent a market that has not yet shown itself. One can make a case for a performance-oriented six-figure hybrid car, but for now the jury is still out.

Two-mode hybrid
GMC Yukon Hybrid. This fall, General Motors will be coming out with hybrid versions of the company's most popular full-sized SUVs, the Chevrolet Tahoe and GMC Yukon.
It might seem silly to make hybrid versions of these big vehicles, but if you consider the amount of fuel ultimately saved, it actually makes a lot of sense. Even a modest improvement in the efficiency of a vehicle that uses a lot of fuel will save more gallons than a large improvement in an already-efficient small car.

There are performance challenges in creating a large hybrid SUV, though. If the hybrid version can't tow or haul just like the non-hybrid, consumers won't buy it. Instead they'll just go back to non-hybrid SUVs. So the hybrid SUVs have the same big V8 engines as their non-hybrid counterparts, ready to pull a trailer when needed.

When not needed, however, GM's "dual mode" hybrid system employs a variety of fuel-saving tricks when the vehicle is traveling at highway speeds.

Four of the eight cylinders will shut down when their power is not needed. (The hybrid uses a large engine - 6.0 liters - so that half will still provide adequate pull and the SUV can spend more time in 4-cylinder mode.)

The SUV's electric motor also connects to the wheels one way at low speeds and another at high speeds, allowing it to provide maximum assistance at any speed.

As with many other hybrid vehicles, the GM hybrid SUVs can travel under electric power alone for short distances at low speeds, and the gasoline engine shuts down altogether whenever the vehicle stops.

Plug-in Hybrid
Chevrolet Volt. Even though it has a gasoline engine and an electric motor, GM is careful not to call the Chevrolet Volt a hybrid car. We've included it here, though, because it's commonly referred to as a "plug-in hybrid." GM calls it a plug-in electric vehicle with on-board power generation.
The point is that, while the Volt has a gasoline engine, the engine does not power the car's wheels. The wheels are powered by an electric motor. Batteries for the electric motor can be charged by plugging the Volt into an ordinary electrical outlet.

After the batteries are fully charged, the car can be driven for up to 40 miles without needing additional charging. If batteries do run low, the gasoline engine will run to generate electricity as needed.

The only difference then between the Volt and what you would ordinarily call "an electric car" is that it can charge its own batteries - whenever that may be needed - in addition to using power supplied by your local electric utility.GM has no official on-sale date for the Volt. More research is still needed on the battery, and there's no way to put a timetable on the needed breakthroughs, the company has said.
(C)CNN

2007 Mercedes-Benz CL550

Updated with an all-new look for 2007, the CL-Class is highlighted by a gaping front grille, flared fenders and raked roofline.


DN Rate: 9.5 out of 10

This luxurious coupe is a near-perfect mix of high performance and high tech.
Pros:
* Night-vision display positioned in the instrument cluster
* Front seats feature an almost ridiculous amount of adjustment
* Active Body Control keeps the car steady as she goes

Cons:
* Instrument panel display washes out in bright sunlight
* No auxiliary audio input
* Hands-free phone system is an extra-cost option

It's easy to tell that the 2007 Mercedes-Benz CL550 is a breakthrough vehicle by its appearance alone. The absence of a B pillar instantly distinguishes the classy coupe. Its gaping front grille, flared fenders and raked roofline also make it stand out. The view from the driver's seat is equally impressive: yards of high-quality leather covering the doors, dash, seats and center console, and as much hand-polished burl-walnut as a small boardroom.

The CL550 we tested (with a sticker price of $111,675) is more than just easy on the eyes. While this preening machine is designed to pamper its lucky driver and passengers, it's also a neat flawless blend of high-tech performance, safety, comfort and convenience.

Perfect Example
An example that encompasses all of these factors is the Active Body Control (ABC) suspension that keeps the coupe steady on even the curviest of roads. ABC uses a set of 13 sensors tied to a servo-controlled suspension that effectively eliminates body roll and any other movements caused by accelerating, cornering and braking. ABC isolates the feel of the road more than some enthusiasts may prefer, although a Sport mode optimizes the suspension for more spirited driving.

The CL550's 5.5-liter V8 is specified at 382 horsepower at 6000 rpm and 391 lb-ft of torque at 2800-4800 rpm. This power is channeled through a 7-speed automatic with driver-adaptive programming that supposedly "learns" the style of the driver and adjusts its shifting accordingly. Buttons on the back of the steering wheel allow manual up- and downshifting, although I found that there was close to a two-second delay in the response on upshifts, which caused the engine to approach redline before the tranny eased into the higher gear.

Perfect Example
An example that encompasses all of these factors is the Active Body Control (ABC) suspension that keeps the coupe steady on even the curviest of roads. ABC uses a set of 13 sensors tied to a servo-controlled suspension that effectively eliminates body roll and any other movements caused by accelerating, cornering and braking. ABC isolates the feel of the road more than some enthusiasts may prefer, although a Sport mode optimizes the suspension for more spirited driving.

The CL550's 5.5-liter V8 is specified at 382 horsepower at 6000 rpm and 391 lb-ft of torque at 2800-4800 rpm. This power is channeled through a 7-speed automatic with driver-adaptive programming that supposedly "learns" the style of the driver and adjusts its shifting accordingly. Buttons on the back of the steering wheel allow manual up- and downshifting, although I found that there was close to a two-second delay in the response on upshifts, which caused the engine to approach redline before the tranny eased into the higher gear.

Surfeit of Safety
When you do get the CL550 going at speeds that take advantage of its performance prowess, it's good to know that a surfeit of safety tech is on standby, including nine airbags. The Electronic Stability Program (ESP) helps prevent drive-wheel slippage by dialing back the throttle and brakes individual wheels to correct understeer and oversteer. If ESP senses something is amiss, the CL550's PRE-SAFE System takes over and prepares for an accident by adjusting the front passenger seat for better alignment with the airbags, inflating the front seats' bolsters and closing the windows and sunroof. The Distronic Plus adaptive cruise control also pitches in on safety by sounding a warning if a car gets too close to the front of the CL550, even when the Distronic Plus system isn't engaged.

The Night View Assist system is the most noteworthy of the CL550's safety tech. Infrared beams projected from the CL550's front grille illuminate an area up to 500 feet out in front of the vehicle so that an IR camera in the rearview mirror can scope it out. The camera sends a grayscale image to a large multifunction display in the instrument cluster. Unlike BMW's night-vision system, which uses a screen mounted in the center of the dash, the CL550 screen puts night vision in the driver's line of sight. But to accomplish this there's a slight tradeoff.

The part of the multifunction display that shows the night-vision image otherwise serves as the speedometer (which is incorporated below the night-vision screen when the system is activated). Driving eastbound one day close to sunset, I glanced down at the speedometer and noticed that it had completely vanished. It wasn't until I made a turn that I discovered that the screen had simply washed out in the bright sunlight.

Super Seats
That's when the power rear sunshade comes in handy. It's one of the many comfort features found in the CL550's cabin but the seats are probably the best highlight. They're heated and ventilated, of course, and in addition to the standard controls on each door you can also individually adjust the seat-cushion and backrest bolsters and the curvature of the backrest in the lumbar and shoulder areas. This is done by adjusting air pressure in a series of chambers within the seat to your individual preference via the Mercedes' COMAND controller in the center console and an in-dash screen.

The Driving Dynamic feature also adjusts the front seats' side bolsters in relation to the car's movements. When making a left-hand turn, for example, the right-side backrest bolster fills with air to compensate for your torso's natural movement to the left. Plus, you can also select four separate backrest massage modes.

The COMAND controller makes it simple to accesses most of the CL550's tech gadgets. These include a GPS navigation system that uses a 20GB hard disc to store map data instead of DVDs for a faster response time, and a sweet-sounding Harman/Kardon audio system that includes 11 speakers powered by 600 watts. The system's 6-disc DVD/CD changer is hidden behind a trim panel at the bottom of the center stack, along with a PC Card slot that can be used to play MP3s files. The car doesn't have an aux-in for a portable media player, although an optional iPod-integration kit is available for an extra $425.

You'll also have to spend more if you want to access the COMAND controller's hand-free telephone functions (or use the separate telephone keypad just in front of the COMAND control) since it's only compatible with optional Mercedes phone cradles and Bluetooth accessories that cost $220 to $420. Maybe this is a minor quibble with a car that's so loaded with technology—and it may be chump change for someone dropping this amount of dough on a ride—but Bluetooth is becoming so prevalent that almost any car half the cost of the CL550 now features it.

Not Just Any Car
But this isn't just any car, as its appearance initially confirms and its prodigious performance, safety and comfort can ultimately attest. With the 2007 CL550, Mercedes has built one of the most luxurious high-performance and high-tech coupes on the road today. That near-perfection, of course, comes at a steep price very few people can afford. But eventually some of its tech will trickle down to cars that more of us can afford. Well, maybe not the seats.
(C)Doug Newcomb

Big Brother can save you money

Car insurers explore ways to track drivers so they know whom they can charge less.

A new discount plan from GMAC Insurance gives a discount on premiums to drivers of General Motors vehicles with the OnStar service if they let the insurer track the number of miles they drive.

Other companies have been experimenting with similar programs, which is causing concern about how much privacy drivers may unwittingly give up in exchange for savings.

OnStar is a program built into most newer GM vehicles that allows occupants to communicate with a help-desk operator.

Among the services are travel directions and restaurant reservations. An OnStar call can also be initiated automatically in the event of a crash to get help quickly. OnStar subscribers can also get a monthly diagnostic email detailing any needed maintenance or potential problems for their car.

The only information OnStar would share with GMAC insurance, both companies said, would be the number of miles driven each month. GMAC would use that information to help it calculate risk. Drivers must enroll in the OnStar Vehicle Diagnostics service to get the discount.

"I wouldn't really consider that to be particularly invasive," said Paul Stephens, director of policy and advocacy for the Privacy Rights Clearinghouse. According to him, it's data that is commonly given out that doesn't dig very deeply into a driver's habits.

The biggest discount of 54 percent would go to those who drive fewer than 2,500 miles per year. The smallest discount of 13 percent would go to those who drive between 12,501 and 15,000 miles per year. No discount would go to those who drive more than 15,000 miles per year.

The plan will be available in 34 states, but will roll out in more states next year, the company said. OnStar currently claims over 5 million total subscribers

GMAC Insurance has been offering the discount on a test basis since January, 2004. So far, according to the company, 10,000 people have signed on.

GMAC Insurance, which is 49 percent owned by General Motors, insures all types of cars, not just GM cars, the company said, but this program would only be available to GM drivers.

Others testing the waters
Progressive Insurance offers a similar program in a few states. It's called TripSense, and it requires participants to plug a computer chip into a port in the the car's dashboard.

The chip collects data, including the number of miles driven and time of day when the vehicles is driven. Participants remove the chip on a regular basis and connect it to a computer to upload the data to Progressive's computers. In exchange, they receive discounts of as much as 25 percent on their insurance premiums, according to the company.

Adding time of day invites the potential for unforeseen uses of the data, according to Stephens. For example, the information might could be subpoenaed in a divorce case to prove that someone was taking a few extra trips that weren't being divulged to his or her spouse.

"I saved $100 on my auto insurance, but I've got a pretty damning piece of evidence here that can be used against me and cost me tens of thousands of dollars," Stephens said.

Progressive also collects data about vehicle speed, acceleration and braking, but that information is used only for research purposes, the company said, and it would not be used to set rates, or as a basis for canceling a policy.

These discount programs are voluntary. As long as consumers understand fully what data is being collected and how it's being used, it's up to them to decide how much information they're comfortable with sharing to save money, said Stephens.

The GMAC/OnStar announcement may spur larger insurers to begin experimenting with programs like these soon, said Brian Sullivan, publisher of insurance industry newsletter Risk Information.

Spokesmen for State Farm and Allstate said their companies are looking into it.

Keep on Truckin
Data-tracking discount programs that collect and analyze even more detailed data than those used by GMAC and Progressive, are already used by the commercial trucking business, according to Sullivan.

Customer acceptance is less of an issue there because the customers aren't the drivers but the trucking company owners who share the insurance company's interest in regulating and tracking driver behavior, said Sullivan.

"The nice thing about truckers," he said, "is if you can make them pee in a cup you can make them do anything."

Programs like that will provide more information about how much impact various data points should have on computing insurance risk and, therefore, premiums, said Sullivan.

And they actually change the way truck drivers operate their vehicles, said Sullivan. When truck drivers are told they are being tracked, as opposed to when they are tracked without their knowledge, they drive more carefully, Sullivan said.

"If everyone had this device on their car," he said, "we'd have far fewer accidents on the road."
(C)Peter Valdes-Dapena

Bad credit? Insurers will make you pay

Your credit usage may be to blame for high home and auto premiums. Here's how to put yourself in a better light.

By now you know that you need to keep tabs on your credit history to make a good impression on lenders, landlords and employers. But did you know that your home and auto insurers are also looking?

In most states they're allowed to use your credit information to formulate premiums - and in June the U.S. Supreme Court decided that your carrier doesn't need to tell you if your credit has caused you to pay more.

In concurrent cases against Geico and Safeco, the Justices unanimously agreed that the companies were not wrong in charging certain poor-credit customers more without notifying them.

The impact of the decision: "You are not going to know if your credit score is costing you," says Harvey Rosenfield, founder of the Foundation for Taxpayer and Consumer Rights.

How insurance premiums are determined is a recipe long kept secret from consumers. Some 90 percent of home and auto carriers use a score based on credit data as part of that recipe, according to risk-assessment firm Fair Isaac, known for its FICO credit score.

Some insurers buy this so-called credit-based insurance score from Fair Isaac or ChoicePoint, another data provider, or devise their own. One insurer may weigh the score heavily, another not so much.

Industry folks say they're simply using all relevant data. "Studies show that how people manage credit is a good predictor of insurance risk," says Claire Wilkinson of the Insurance Information Institute; in other words, insurers think that if you don't pay your bills, you're likely to file a lot of claims.

Whether that's true or not, your carrier will be peeking at your credit history. So you want to make sure it sees you in the best light.

Make sure insurers have the right info
No matter who devises the score, the original data comes from credit bureaus. So check your credit reports for accuracy.

Tell them what they want to hear
Unlike traditional credit scores, insurance scores usually put more weight on prompt bill payment and slightly less on the type of credit you have, says Lamont Boyd, director of product management at Fair Isaac.

But if you follow the same rules for improving your credit score, your insurance credit score should rise as well. In order of importance, says Boyd, they are:

Pay bills on time: Late payments show up for seven years.

Keep revolving balances low: Insurance companies look at how much debt you have relative to available credit.

Keep your oldest credit card: Insurers like folks with well-established lines of credit. Five years is good, 10 ideal.

Don't apply for lots of credit at once: Your score might drop. (You're not penalized for shopping, however; multiple auto or mortgage inquiries within 45 days are considered as one.)

Get rid of miscellaneous cards you don't use: Having too many can hurt your score.

Don't settle
So what if your car insurer decides that you no longer deserve that great rate? Thanks to the Supremes, you won't know why you've become such a poor risk or what to do to lower your premium.

Your best option: Shop for a new policy. You can try other companies, an independent agent or an insurance comparison Web site. Since insurers' weightings of your credit-based insurance score can be quite disparate, you're likely as not to find a company that thinks you are peachy.
(C)Sarah Max

2008 Nissan Rogue: Creating a car for the future

The story behind Nissan's new 2008 Rogue highlights the challenges - and pitfalls - of the auto business.

Way back in 2002 - before the war in Iraq, the collapse of the dollar, or $3-a-gallon gasoline - Nissan started thinking about what kind of cars it would sell in the 2008 model year. One of the results is the Rogue, which will arrive in showrooms this fall. The way Nissan went about conceiving the Rogue reveals the complexities of predicting what customers will want to buy five years into the future - and the risk of betting hundreds of millions of dollars on the outcome.

Getting the answer right is especially important to Nissan right now. Its much-lauded turnaround under CEO Carlos Ghosn has run out of steam and it is in danger of sinking into the second tier of Japanese auto companies, behind Toyota and Honda.

Even scarier, Nissan has guessed wrong in the past. A couple of years ago, it tried to figure out away to attract new buyers to the homely minivan and came up with the concept of the Sexy Mom. Trouble is, the 2004 Quest minivan designed for Sexy Mom substituted fashion for functionality, and flopped in the marketplace. Nissan was forced to de-glamorize the Quest so it could begin to attract more traditional Soccer Moms.

The Quest experience didn't stop Nissan's California-based Global Exploratory Group from trying again five years ago to predict the future. Starting in 2002, the group started with the obligatory clean sheet of paper to figure out how to fill a gap in Nissan's product lineup.

What it came up with was the concept of an entry-level car for members of Generation X, those people born between 1965 and 1978, who were about to get married and start a family.

The first step was figuring out who these buyers were and what they were like. After some research, the group decided that members of Generation X were "the latch key generation." They grew up feeling "unprotected and insecure," and, Nissan concluded, this experience would shape their expectations for their new families and define how they approach parenting.

What did these latch-key kids want in a vehicle? Nissan figured they desired "safety and practicality" but didn't want to advertise their family status. Translation: no minivans allowed.

No traditional SUVs either. These buyers were turned off by heavy body-on-frame designs like the Ford Explorer . They didn't see the need of buying a two-ton vehicle with four-wheel drive for a trip to Whole Foods or Starbucks.

When the generational analysis was completed, the Global Exploratory Group turned its findings over to Nissan's product planning group to develop a concept - sedan, tall wagon or box on wheels - to fit the perceived needs, and to Nissan's designers to create a look.

The group wanted something that would combine style as well as utility. It figured male Gen X'ers would already be driving compact pickups or motorcycles and their wives would be sedan owners. With children on the way or already arrived, these buyers needed something with a tailgate and storage capacity that still exuded individuality.

Nissan's biggest competition was Toyota's RAV-4 and Honda's CRV. But Nissan thought both vehicles were too clunky-looking. So it came up with a design to set its vehicle apart, with an aggressive front end, bulging rear fenders, and prominent 17" wheels. The marketing department picked the name "Rogue" to reflect the rebelliousness of the target buyers.

The automotive media got to see the Rogue for the first time in January at the Detroit auto show. Surrounded by glitzier vehicles, it was overshadowed. Still, Nissan believes that it has targeted the right market - and done it correctly.

When it arrives this fall, the Rogue will be crammed with features designed around the theme of "planned spontaneity." They're aimed at an imaginary guy who drops his kids off at school, and then runs to the shore or the mountains for a joy ride before heading to the office. There's a convenient storage container with a pop-up lid, remote door-unlocking and engine start, and a Bluetooth hands-free phone system.

Prices for the Rogue will start under $20,000. Whether Nissan has another CRV on its hands - or another Quest - will probably be known by Christmas. The members of the Global Exploratory Group aren't holding their breath. They are already looking at what Nissan should be doing in 2012.
(C)Alex Taylor III, Fortune

In Rear-End Crash Test, Most Trucks & SUVs Fail to Stop Neck Injury

Most trucks & SUVs do poorly in whiplash test. 54 current models - or two-thirds of all the vehicles in the test - fail to adequately protect occupants in rear-end collisions.

Two-thirds of pickups, vans and sport-utility vehicles don't provide acceptable protection against whiplash in rear-end collisions, according to tests by the Insurance Institute for Highway Safety (IIHS).

Some 54 models were rated "marginal" or "poor" by the Institute in tests that involved measurements of seats and head restraints and, in some cases, simulated rear-end collisions.

Vehicle seats and head restraints are first measured to determine if the headrest, because of its shape and angle, is likely to provide adequate protection.

Seats that are deemed likely to provide good protection are then tested in a simulated crash. The seat is attached to a moving platform that is struck from behind at 20 miles per hour. The Institute then measures impact forces on a crash test dummy riding in the seat.

Twenty-one current models - or 24 percent of those tested - earned the best possible rating of "Good." Twelve models earned an "Acceptable" rating, the second-best rating.

"In stop-and-go commuter traffic, you're more likely to get in a rear-end collision than any other crash type," says IIHS's David Zuby. "It's not a major feat of engineering to design seats and head restraints that afford good protection in these common crashes."

The agency stresses that to reduce neck injuries, the vehicle's head restraint should be high enough to be at the back of the head.

Rear-end collisions are frequent, and neck injuries account for 2 million insurance claims each year, costing at least $8.5 billion.

For SUVs, the best performers were models by Subaru, Volvo, Acura, Ford, Honda and Hyundai.

Some manufacturers objected to the fact that the seats are not tested while mounted in the vehicle.

"We are confident our whiplash injury lessening system and vehicle design will provide a reasonable level of safety for our customers in the real world," Toyota said in a statement.

While Toyota's Tundra pickup earned the top "Good" rating for whiplash protection in the IIHS tests the Toyota Sienna minivan and Toyota Highlander, when equipped with a tilting headrest and adjustable lumbar support, and 4Runner SUVs earned "Poor" ratings. The Toyota Rav4 and FJ Cruiser SUVs and Tacoma pickup all earned a rating of "Marginal."

Overall, SUVs have the most vehicles with "Good" protection - 29 percent - while vans followed with 27 percent and only 6 percent of pickups earned a "Good" rating.

"The reason may be that automakers have updated or introduced many new SUVs since 2006, but minivans and pickups are being updated more slowly," said Zuby.
(C)CNN

How to cut Car Insurance Price

A CREATIVE job description can cut your car insurance by a third, but be careful - get it wrong and the price goes up.

Insurers raise premiums if they think your job makes you a bigger risk, so altering your job title can save you money.

A barrister, for example, would pay pounds 459 to insure a Fiat Brava. Say you're a lawyer and it drops pounds 83 to pounds 376.

A bricklayer may be charged pounds 321 but call yourself a builder and the premium jumps to pounds 374.

These are the findings of a survey by car insurance website www.confused.com Spokeswoman Jennifer Rose says: "You break the law if you lie about what you do.

"But there's nothing wrong with checking whether a different title for the same job will save you money." It's easy to do that online. But you can discuss alternative descriptions when you're talking to a broker or call centre.

Your job title doesn't only affect car insurance. It makes an even bigger difference to an income protection policy.

One paying out pounds 250 a week while you're off work through illness or injury might cost pounds 16 a month if you say you work in an office.

But if you're in a profession, such as painting and decorating that is seen as being injury-prone it could cost as much as pounds 48.

(c) 2007 Daily Mirror.

For Riders, Risk Is Growing

The air bag on Lou O'Connell's Gold Wing helped him avoid injury.

Returning to the office from lunch on his 2007 Honda Gold Wing motorcycle one day this spring, Lou O’Connell got a glimpse into the future, if only by two seconds or so. A car pulled out of a shopping center in Weston, Fla., near Fort Lauderdale, and into his path. He could see that he was going to hit the car.

Mr. O’Connell said that although he did not expect to be killed in the impending crash — becoming one of the 5,000 or so motorcycle riders who will die on American roads this year if recent trends continue — he knew that at the very least he was about to go flying over the handlebars.

But then there was a bang and a cloud of powder in front of him. Though the front of his bike had slammed the passenger side of a black Nissan 350Z, Mr. O’Connell found himself nearly uninjured — intact enough to lay down the bike and stride over with some well-chosen words for the car’s driver.

Mr. O’Connell’s accident was, so far as Honda knows, the first in which the air bag of a motorcycle deployed to protect a rider. At least for now, the air bag is an option only on the big Gold Wing touring bikes, which cost nearly $25,000 fully equipped with features like heated handgrips and antilock brakes.

“It’s amazing,” said Mr. O’Connell, who escaped with only bruises on his shins. Without the air bag, his injuries might have been serious: Florida relaxed its helmet law in July 2000, and he had been seduced by good weather to ride without one. “It was so nice, I couldn’t resist, and I couldn’t resist the American dream,” Mr. O’Connell, an immigrant from Ireland, said. “The American dream is to ride a motorcycle without a helmet.”

Honda began development of motorcycle air bags in 1990 and tested the system for a decade before making it available on the Gold Wing for 2007. A Honda spokesman, Jon Row, emphasized that the air bag was something of a last measure in today’s safety technology, and is not intended to replace the need to wear a helmet.

Mr. O’Connell, 40, and the father of two young children, said the accident persuaded him to wear his helmet whenever he rides.

The crash was something of a milestone in motorcycle safety, one of the few positive developments in recent years. Riding a motorcycle is becoming riskier. Deaths last year increased by 5.4 percent over 2005, according to preliminary estimates of the federal Fatality Analysis Reporting System, and are up for the ninth consecutive year. Deaths have increased 125 percent over 10 years, a period in which registrations rose more than 50 percent.

Even when adjusted for more bikes covering more miles, the picture is grim. While the death rate for people in vehicles fell by about 17 percent for each mile traveled over that period, the rate for motorcycle riders more than doubled, according to the report.

That timeline coincides with factors including a rising average age of riders, more powerful engines and the repeal of state laws requiring universal helmet use, in part a result of pressure applied by lobby groups that persuaded legislators to “let the rider decide.” Wearing a helmet cuts the risk of death by about 37 percent, according to Ted R. Miller, a researcher at the Pacific institute for Research and Evaluation. Making helmets mandatory increases use because police officers can check compliance at a glance.

Measuring the effect of motorcycle helmet law repeals is tricky because of factors like the increase in motorcycle sales. Still, the numbers are powerful. Texas, which loosened its laws in 1977 and then reinstated universal coverage in 1989, again backed down on the regulations in 1997 for riders over 21; fatalities shot up 31 percent in the first year after the law was relaxed. A study in Florida sponsored by the National Highway Traffic Safety Administration found that in the two years after that state repealed its universal helmet law in 2000, fatalities for every 10,000 motorcycles were up 21 percent, compared with 13 percent nationally.

At the National Transportation Safety Board, the death toll has not gone unnoticed because it is now larger than the number of deaths in airplane, marine, railroad and pipeline accidents combined. Deborah A. P. Hersman, a member of the board who presided over a two-day motorcycle safety forum last September, said in an e-mail message, “This is the only mode of transportation in which the overall number of fatalities and the rate of fatalities continue to steadily rise, and yet there is no public outcry.”

While it might seem that older riders would be more experienced and less likely to take risks, other factors may lie behind their portion of the fatality increases.

“It’s the baby boomers,” said Barbara L. Harsha, executive director of the Governors Highway Safety Association, a Washington-based group of state officials. Many riders are returning to bikes years after having given up riding, and “they don’t realize how powerful the bikes are,” she said.

Government statistics support, in raw numbers at least, the assertion about older riders, even if the data cannot assign blame for the fatal crashes. Umesh Shankar, an analyst at the National Highway Traffic Safety Administration, said that the number of fatalities among riders 40 and over had more than tripled.

The industry, though, says the statistics are misleading. The Motorcycle Industry Council, a trade association, says that the fatality rate — which takes into account miles traveled — has been calculated incorrectly, in part because the Transportation Department does not accurately tally the number of miles ridden. For instance, government statistics say motorcycles traveled 9.6 billion miles in 2003; the industry council’s research says they actually traveled 20.6 billion miles.

The Motorcycle Safety Foundation, which is allied with the industry council, does agree that returning riders can be a problem. Dean L. Thompson, a spokesman for the safety group, said that older riders should “not be in denial about their skills, which decline over time.” Riders should know their limits, he said.

With gasoline prices high, some riders are putting more miles on their bikes. Mr. O’Connell, the Gold Wing owner, loves to ride but also uses the bike in his business. He is a commercial real estate broker, and says when he arrives to show a property, the big Honda impresses customers.

The industry’s consistent message is that more rider training will reduce the number of deaths. Last fall, Ms. Hersman took a basic rider course, and got a motorcycle endorsement on her Virginia drivers license.

Ms. Hersman may be better prepared than most riders; according to the industry, only about 38 percent of riders have taken an organized rider education course. The Motorcycle Safety Foundation urges riders to take recurrent safety courses, wear protective gear and not ride while impaired.

Air bags, which have cut the fatality rate in cars, are not adaptable to all motorcycles. They are well suited to touring models like the Gold Wing or the very popular cruiser bikes, where the rider sits upright, but sport bikes with a crouched riding position present a design challenge.

Electronic antiskid systems, a technology that has been very effective in preventing car and truck crashes, are not applicable to two-wheel vehicles, but traction control devices are already available on many BMW motorcycles. In addition, BMW offers tire pressure monitoring, which can help riders prevent problems on the road.
(C)MATTHEW L. WALD

AirBag Fundamentals / "Ignore the airbag" wars

What's important isn't the number of airbags, it's the type of airbags and their effect on crash scores.

It used to be horsepower. Then it was fuel economy. Now there's another number making its way into the big print in car ads: the number of airbags.

Already, Toyota is bragging about its "segment-leading" 10 airbags on the 2008 Lexus LX570 SUV. TV and magazine ads for cars and SUVs often tout the number of airbags as a competitive advantage.

The obvious implication is that a car with more airbags is safer than one with fewer. If a car has 10 airbags while its competitor has only six, you can just imagine the sorts of injuries you could suffer with four fewer bags.

This is not to say that the LX570 will be anything other than very safe - just like every other Lexus vehicle. It's just that, in the end, airbag counting isn't the most useful way to gauge safety.

A car with six or eight airbags might protect every part of every occupant just as thoroughly as a car with 10. One long head-protecting side airbag can offer as much coverage for three rows of seats as three separate airbags.

Besides, airbags by themselves don't make a car safe. They're complex devices that work with a car's metal body and its seatbelts to protect occupants. Fewer, better designed airbags in a well-engineered car body are worth more than a whole bunch of airbags in a car that offers little protection on its own.

And the proof lies in crash test results from agencies like the government's National Highway Traffic Administration and the private Insurance Institute for Highway Safety.

No vehicle without head-protecting side airbags has ever earned a top rating in the Insurance Institute's side crash test. But it must be noted that some vehicles with them earned a Poor rating anyway. Again, airbags are vitally important, but they're not enough, by themselves, to insure your safety.

Since some types of airbags often come as extra-cost options rather than standard equipment, it's still good to know what all those airbags do and how. Sometimes fewer can be just as good as more.

Front airbags
Front airbags come out of the dashboard and protect the driver and front passenger in a front crash, and are required by law on all cars. But a few types of front airbags include slight changes that make the airbags themselves safer.

Early airbags actually resulted in injuries and even some deaths in what would have otherwise been minor accidents. In order to open quickly enough to protect occupants, the airbags opened with such explosive force that they could cause injuries - especially to small children or occupants who weren't seated far enough back from dashboard.

Many cars now have airbags that can open in different ways depending on what sensors detect about the size or position of the person in the seat. If sensors detect a small person, or that the person is leaning forward, the airbag can open slower or to a smaller size.

Side airbags
As the name suggests, side airbags protect occupants from getting hit from the side. Statistics prove that they're highly successful.

While airbags that protect occupants from the shoulders down reduce fatalities in side impacts by 26 percent, those that also protect their heads reduce fatalities by 37 percent, according to data from the Insurance Institute for Highway Safety.

In some SUVs, head-protecting side airbags serve an additional role. In rollover crashes, they can stay open longer to help protect occupants - or their heads and arms - from being thrown outside the vehicle.

Here's where those tricky airbag counts come in. Airbags that protect the head don't have to be separate from the ones that protect the ribs. A single airbag can protect an occupant's body while also reaching up to protect the head.

Either way, the protection should be just as good. Real-world crash data has not shown any advantage to systems that use separate head-and-torso airbags over those that use a single head-torso bag, according to the Insurance Institute.

Side airbags can also protect rear seat, as well as front seat, occupants. If a vehicle has head-protecting side airbags protecting the back seat passengers, they can be separate from those protecting front seat occupants. On the other hand, you might have side curtain airbags that cover two, or even three, rows of side windows. That's just as much protection as you'd get with two or three separate airbags.

Leg airbags
With more lives being saved by front airbags, leg injuries in front crashes have started getting more attention. Some cars now have airbags underneath the dashboard to protect occupants' knees and legs.

Whether or not these airbags are effective isn't really known yet, said David Zuby, the Insurance Institute's vice president of vehicle research. They may help out in vehicles where leg injuries would a problem otherwise. But so far, there is no evidence to show that people suffer fewer leg injuries in vehicles with them than without them.
(C)CNN

Car Options Compare: Must Have / Maybe / Buy it Later

Electronic stability control - Must-have
Studies indicate that electronic stability control, shown helping a Chrysler Pacifica make a turn in heavy snow, can reduce the odds of a fatal crash by as much as a third. And it helps a lot in cars as well as SUVs.

This safety feature is so good it's already standard on half the cars sold in the U.S. today. By applying the brakes to individual wheels when sensors detect a loss of control, ESC helps keep your car from spinning into a guardrail (or worse).
On models where it's offered as an option, such as the Mazda 3 and Cadillac CTS, it'll run you an extra $500 or so.

ESC is quickly joining seat belts and ABS as part of the safety triumvirate that every car should have. In five years you won't have a choice: ESC has been slated to be mandatory by 2012.

The Verdict: The best $500 you can spend. If a car you're considering doesn't offer ESC, then reconsider that car.

Side airbags - Must-have
Side airbags, especially ones like these that include protection for occupants' heads, significantly reduce the risk of death and serious injury from side impacts. They are standard equipment on many cars, including the Volvo C30, for which a mock-up is shown here.

Front air bags get all the cool crash-test footage, but side air bags are no less important for occupant safety. There are two basic types of side air bags: ones that protect the head (side-curtain air bags) and ones that protect the chest (side-torso air bags). A car can have curtain air bags, torso air bags or a combination of the two.

According to the Insurance Institute for Highway Safety, side-curtain bags have reduced driver deaths in side collisions by 37 percent. Side-torso bags have reduced driver fatalities 26 percent. Since 1999 a voluntary standard has minimized any risk side air bags posed to children; go to safercar.gov to see if your model meets that standard.

Side air bags will add around $600 to your negotiated price but, really, is this an area of the car where you want to be cheap?

The Verdict: The more your car looks like it was attacked by the Stay Puft marshmallow man in the event of a crash, the better off you'll be. Spend the money.

Run-flat tires - Maybe
Nobody loves changing a flat tire, but some hate it more than others. If you fall into the latter camp, run-flats may be a good buy.
Offered on cars from the Mini Cooper to the Rolls-Royce Phantom, run-flat tires let you drive up to 100 miles at 50 mph even if a tire has lost all its air. There's no spare in the trunk (which can give you more space for your gear) and you'll never have to crouch on the side of a highway at 11:30 p.m.

Upscale versions of the Honda Odyssey minivan use the Michelin Pax run-flat system shown here.

That said, run-flats can cost as much as 50 percent more than regular tires (it's a roughly $400 option on most cars), not every tire shop is certified to handle maintenance and getting a run-flat patched after a blowout can cost upwards of $50 - twice the price of a standard patch job.

The Verdict: It comes down to how often you expect you'll change a tire and whether you'd pay around $400 to avoid it.

Bluetooth phone kit - Maybe
In many states it's now against the law to talk on a handheld phone while driving (cruising while eating a Big Mac, however, is totally legal everywhere). The Bluetooth option, available in cars such as the Chrysler 300C and Nissan Versa, means you can use a wireless connection and steering-wheel-mounted buttons to place and receive calls.

On factory-installed Bluetooth systems such as Audi's, your phone-book info is also downloaded to your car's in-dash display so you can scroll through a call list. Most systems incorporate voice-recognition technology, so initiating a call is simply a matter of saying "Call home."

A Bluetooth connection allows your car to instantly and wirelessly hook to devices like a cell phone or music player, as here in a Volvo C30. But it adds only a little to what most of today's cell phones can already do with a headset.

Of course many cell phones already have built-in (albeit tinny) speakerphones, and some offer voice recognition as well. And you can buy an earpiece for next to nothing.

Factory-installed Bluetooth systems can run around $300, while a regular phone with similar features may cost $50 - that's a pretty big spread.

The Verdict: If you're conducting a lot of business from the driver's seat and need a crystal-clear, full-featured hookup, your car's Bluetooth is the answer. If you're just calling the family to say you're heading home, a handset's speakerphone or an earpiece should do the trick.

Rearview camera - Maybe
Rearview cameras are immensely helpful - you get a wide-angle view of everything behind your rear bumper, whether it's another car or a tyke's Big Wheel.

So why isn't it a must-have? The problem is that rearview cameras are often packaged with other options that aren't nearly as useful. On the Infiniti M35, for example, a backup cam is part of the $2,950 "Technology Package," which includes in-dash navigation and an upgraded stereo. It's one thing to package some sybaritic luxuries together (if you want massaging seats and a backseat refrigerator, that's your business), but automakers shouldn't play cute with something that actually contributes to pedestrian safety.

Some rearview cameras, like the one on this Mercedes-Benz S-class, overlay lines onto the image to show where the car will go based on the current steering wheel position.

The Verdict: It's a genuine advance, but just try finding it a la carte. Unless you really like the other options included in the package, spend a little extra time looking behind you when you back up.

GPS navigation - Buy it later