TIME Transportation

What Happened to the Car Industry’s Most Famous Flop?

A 1958 Edsel Convertible
A 1958 Edsel convertible made by Ford Underwood Archives / Getty Images

Market researched failed in a major way

Any crossword puzzler knows there’s a five-letter word for a Ford that flopped: Edsel.

At the heart of any big flop–like when Ford ended the Edsel 55 years ago, on Nov. 19, 1959–lies high expectations. The Edsel was named after Henry Ford’s son, no small honor, and it had its own division of the company devoted to its creation. As TIME reported in 1957 when the car debuted, the company had spent 10 years and $250 million on planning one of its first brand-new cars in decades. The Edsel came in 18 models but, in order to reach its sales goals, it would have to do wildly better than any other car in 1957 was expected to do. The September day that the car first went on the market, thousands of eager buyers showed up at dealers, but before the year was over monthly sales had fallen by about a third.

When Ford announced that they were pulling the plug on the program, here’s how TIME explained what had gone wrong:

As it turned out, the Edsel was a classic case of the wrong car for the wrong market at the wrong time. It was also a prime example of the limitations of market research, with its “depth interviews” and “motivational” mumbo-jumbo. On the research, Ford had an airtight case for a new medium-priced car to compete with Chrysler’s Dodge and DeSoto, General Motors’ Pontiac, Oldsmobile and Buick. Studies showed that by 1965 half of all U.S. families would be in the $5,000-and-up bracket, would be buying more cars in the medium-priced field, which already had 60% of the market. Edsel could sell up to 400,000 cars a year.

After the decision was made in 1955, Ford ran more studies to make sure the new car had precisely the right “personality.” Research showed that Mercury buyers were generally young and hot-rod-inclined, while Pontiac, Dodge and Buick appealed to middle-aged people. Edsel was to strike a happy medium. As one researcher said, it would be “the smart car for the younger executive or professional family on its way up.” To get this image across, Ford even went to the trouble of putting out a 60-page memo on the procedural steps in the selection of an advertising agency, turned down 19 applicants before choosing Manhattan’s Foote, Cone & Belding. Total cost of research, design, tooling, expansion of production facilities: $250 million.

A Taste of Lemon. The flaw in all the research was that by 1957, when Edsel appeared, the bloom was gone from the medium-priced field, and a new boom was starting in the compact field, an area the Edsel research had overlooked completely.

Even so, the Edsel wasn’t a complete loss for Ford: the company was able to use production facilities build for Edsel for their next new line of, you guessed it, compact cards.

Read the full report here, in the TIME Vault: The $250 Million Flop

TIME Automotive

BMW Recalls 1.6 Million Series 3 Autos Over Airbag Fault

BMW 3 series Gran Turismo
BMW 3 series Gran Turismo Daniel Kraus—BMW

BMW is one of a group of automakers affected by a faulty airbag supply

BMW said Wednesday it’s recalling 1.6 million 3 Series vehicles in order to replace passenger-side front airbags on its vehicles.

The luxury car maker said the recall is a “voluntary precautionary measure” that is aimed at minimizing the risk of faulty airbag activation. BMW said the recall affects cars for the model years 2000 to 2006.

An airbag component made by one of BMWs suppliers, Tokyo-based Takata Corp., could explode under certain circumstances, the Wall Street Journal reports. The airbag defect has caused the recall of 10 million vehicles by seven affected automakers since 2009.

About a third of the BMW cars to be recalled are in the U.S.

BMW said it will bear the cost of replacement.

TIME Gadgets

How Google and Apple Plan to Invade Your Next Car

Jared Newman for TIME

Between Android Auto and Apple CarPlay, the road to smarter cars is looking less rocky.

Just plug in your phone.

That simple step is how Apple and Google will shave years off the process of getting their software into automobiles. Instead of trying to bake iOS and Android into car makers’ infotainment systems, the two tech giants have come up with a workaround: You just plug in whatever phone you have, and send the software to the car by wire.

We’ve known for a while now that Apple was going this route with CarPlay. As announced in March, users will connect their phones to supported vehicles through a Lightning cable, and a specialized version of iOS takes over the center screen. You can then ask Siri for directions, put on some music, make a phone call through the car’s speaker system or dictate a text message. It’s supposed to be just as safe as any in-car dashboard–and much safer than looking down at your phone while driving.

Last week, Google announced a similar system called Android Auto. Instead of using a Lightning cable, it uses MicroUSB. Instead of speaking to Siri, you use Google voice search. Instead of Apple Maps for directions, you get Google Maps. Both Apple and Google are also soliciting app developers so that certain apps on your phone–such as your favorite streaming music service–will show up in the car.

Naoki Sugimoto, Senior Program Director for Honda’s Silicon Valley Lab, told me during Google’s I/O conference that it can take five years to develop a new car. But since Android Auto doesn’t involve specialized hardware, Honda has figured out how to quickly integrate Google’s software.

“These are mostly software features, so the way we work is to try to decouple software architecture from hardware architecture,” he said. “So this way, in the five-year process, we can wait until the last moment to put a new feature into the production schedule.”

And here’s the kicker: Android Auto and Apple CarPlay are similar enough in their underlying architecture that some auto makers–including Honda and Volvo–are planning to support iOS and Android at the same time. So at least in some vehicles, you won’t have to pledge allegiance to a single platform when you buy your car.

The plug-in system doesn’t just provide more choice for users. It also allows auto makers to retain some control over the dashboard, and frees Google and Apple from having to support things like FM radio, climate control and Bluetooth connectivity. For all those things, you’d still use the car’s built-in system. But when you want your car to be a little smarter, you’ll just bring along your cable of choice–MicroUSB or Lighting–and plug in the phone you’ve got. (Both Google and Apple are letting auto makers decide how the car’s native systems should integrate with Android Auto and CarPlay. Google is also letting auto makers add some of their own features to Android Auto, such as vehicle diagnostics and roadside service requests.)

The trade-off is that performance can be a little laggy–at least that was the case in my Android Auto demo at Google I/O last week–and you’ll always have to take the phone out of your pocket to use Android Auto or CarPlay. Maybe someday we’ll see a system that connects wirelessly to your phone while still providing the entire Android or iOS interface, but doing so today would cause a huge hit on the phone’s battery life. I imagine people will still rely on Bluetooth connectivity some of the time, even if it means having no apps and no on-board navigation.

I haven’t tried CarPlay yet, but I spent some time in a Honda demo car with Android Auto at Google’s I/O conference this week. In short, it looks like a much safer way to listen to music, make phone calls and get directions while driving. Both Apple and Google claim that their software will start showing up in cars later this year; I’m looking forward to when plugging in your phone is as common as popping in a CD once was.

TIME Automotive

These Are The 69 Words GM Employees Were Forbidden from Using

Massive Ignition Switch Recall Weighs Heavy On GM's Profits
The General Motors world headquarters is shown April 24, 2014 in Detroit, Michigan. Bill Pugliano—Getty Images

A 2008 PowerPoint presentation released as part of General Motors’ $35 million settlement with the U.S. government cautioned employees against using words and phrases including "rolling sarcophagi," "Hindenberg" or "Kevorkianesque" in reports and presentations

Documents released by the National Highway Traffic Safety Administration on Friday show that there are some things you can say if you’re an employee at the kingpin automaker… and there are other things you just can’t.

Released as part of General Motors’ $35 million settlement with the U.S. government over its faulty ignition switch scandal, the slides from a company presentation in 2008 told employees to choose their words carefully, because anything said could end up publicized.

Basically, the presentation is a 101 in how to avoid a PR disaster. It’s not hard to imagine how the meeting unfolded.

GM management appears to have asked employees not to liken vehicles to “rolling sarcophagi,” and not to compare an automobile to the “Titanic” or the “Hindenburg.” And it could have really unnerved drivers if they heard that GM engineers had called their Chevrolet Malibus “gruesome” “deathtraps.” Staying away from the whole death thing was apparently highly recommended.

Employees were asked to avoid the use of the word “inferno” (unless, perhaps they were referring to the epic poem by Dante Alighieri, or the equally classic Dan Brown tale), and they were asked to avoid language that might evoke “explosions” or “powder kegs.” Cutting imagery such as “mutilating,” “lacerating” and even the more equivocal “potentially-disfiguring” was also to be eschewed.

Apocalyptic language, particularly in reference to their vehicles, was not condoned. And no, “Kevorkianesque” was not acceptable language, unless perhaps employees were rationally discussing the merits of euthanasia.

Here’s a full list of example words employees were asked to avoid:

always, annihilate, apocalyptic, asphyxiating, bad, Band-Aid, big time, brakes like an “X” car, cataclysmic, catastrophic, Challenger, chaotic, Cobain, condemns, Corvair-like, crippling, critical, dangerous, deathtrap, debilitating, decapitating, defect, defective, detonate, disemboweling, enfeebling, evil, eviscerated, explode, failed, flawed, genocide, ghastly, grenadelike, grisly, gruesome, Hindenburg, Hobbling, Horrific, impaling, inferno, Kevorkianesque, lacerating, life-threatening, maiming, malicious, mangling, maniacal, mutilating, never, potentially-disfiguring, powder keg, problem, rolling sarcophagus (tomb or coffin), safety, safety related, serious, spontaneous combustion, startling, suffocating, suicidal, terrifying, Titanic, unstable, widow-maker, words or phrases with a biblical connotation, you’re toast

A spokesman for GM, Greg Martin, said the company’s culture has changed since the 2008 training session in which the PowerPoint presentation was shown. “Today’s GM encourages employees to discuss safety issues, which is reinforced through GM’s recently announced Speak Up for Safety Program,” Martin said in a statement to Reuters.

GM has promised to improve employee training regarding documentation practices and discussion of safety issues, as part of the government settlement. But don’t expect the automaker to name its next SUV model “Challenger” any time soon.

Here’s the list as seen on the original document:

Screen-Shot-2014-05-17-at-11.05

TIME Autos

BMW’s Latest Is a Drop-Dead Stunner With a Huge Surprise

BMW i8
BMW i8 UWE FISCHER/BMW

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This post is in partnership with Fortune, which offers the latest business and finance news. Read the article below originally published at Fortune.com.

BMW’s new $135,000 i8 sports car, which will begin appearing on the streets of Beverly Hills and Greenwich in a few weeks, defies easy categorization. It is fast. It is light. It is exceptionally fuel-efficient and eye-catching.

Think of i8 as a Porsche Carrera behaving from time to time like a Toyota Prius or Nissan Leaf.

As stunning and original as the i8 is from an automotive engineering standpoint, it represents an important philosophical statement for the German automaker, known until now for powerful, sporty machines more than environmental righteousness. Tougher regulations regarding carbon emissions threaten BMW and other makers of high-performing models unless they can develop and master advanced energy-efficient technologies, such as those embodied in i8.

One such breakthrough technology exemplified in the i8, as well as for BMW’s smaller, less expensive i3 city car, is extensive use of carbon fiber instead of steel. The cockpits of both cars are fabricated from the material, which has never before been used for the mass manufacture of a high-volume vehicle due to prohibitive cost and complication.

“What makes carbon fiber feasible for these new models is the way in which we have learned to manufacture the substance so that the process can be more highly automated, quicker and less wasteful,” said Andreas Wuellner, managing director of SGL Automotive Carbon Fibers LLC, in Moses Lake, Washington.

MORE: Tesla’s big gamble in China

SGL, a joint venture partner with BMW, on Friday announced a new $200 million investment to triple the capacity of its Moses Lake factory, making it the largest such installation in the world. The location of the plant was chosen, in part, because the electricity could be furnished by hydroelectric generators, which produce little or no carbon dioxide compared to fossil-fuel plants

The gas-electric plug-in hybrid i8, weighing 3,274 pounds (about 1,000 pounds less than an aluminum-bodied Tesla Model S electric), can accelerate to 60 miles per hour from 0 in about 4.4 seconds. Though the U.S. federal fuel efficiency rating hasn’t yet been released, BMW engineers calculate it will be about 90 miles per gallon.

i8 can be driven in five different modes, each of which optimizes some combination of range, power, fuel efficiency or battery charge. Under ideal conditions, the car can be driven as far as 375 miles before it needs a fill-up or a charge. But it can also be driven up to 23 miles in battery-only mode.

As if the i8′s lowslung body wasn’t sexy enough, its gullwing doors deliver a heart-fluttering caress. (BMW calls them “scissor” doors to avoid the gullwing designation first made famous by archrival Mercedes-Benz.)

BMW’s $41,400 i3 already appears to be a hit. The automaker said on April that it was increasing the rate of production to 100 cars per day, in the face of strong initial demand. Both models are built at BMW’s factory in Leipzig, Germany, which is powered in part by wind turbines.

BMW has dabbled with carbon fiber previously: its extensive use in i3 and i8, like Ford Motor Company’s decision to manufacture its next-generation F Series pickup from aluminum, are signs that the environmental concerns are growing daily as a critical factor in vehicle design.

TIME Autos

General Motors Bailout Cost Taxpayers $11.2 Billion

The total cost of the government's bailout for General Motors has come to $11.2 billion after the Treasury sold the last of its assets in December

U.S. taxpayers lost more than $11.2 billion as a result of the federal bailout of General Motors, according to a government report released Wednesday.

The $11.2-billion loss includes a $826-million write-off in March from government investments in the “Old GM” before the company’s 2009 bankruptcy, the report said. The U.S. government spent $49.5 billion to bail out GM, and after the company’s bankruptcy in 2009, the government’s investment was converted to a 61 percent equity stake in the company. The Treasury gradually sold off its stock in GM, selling its last shares in December 2013.

The Center for Automative Research said last year that the taxpayer bailout of GM saved 1.2 million jobs and avoided the loss of $129.2 billion in personal income in 2009 and 2010. Of the $78.2 billion the U.S. Treasury spent bailing out the auto industry through its Troubled Asset Relief Program, $58.0 billion was repaid, according to the report.

GM is currently being investigated by the Justice Department and regulators for its handling of a defect in an ignition switch that led to more than 10 deaths.

TIME cars

All New Cars Must Have Rear-View Cameras By 2018

The rear-view camera on the trunklid of the 2012 BMW 650i Coupe.
The rear-view camera on the trunklid of the 2012 BMW 650i Coupe. Mark Elias—Bloomberg via Getty Images

A government regulation says all new vehicles under 10,000 pounds must have rear-view cameras, which could save as many as 69 lives a year

The Department of Transportation announced new regulations Monday requiring all new vehicles to include rear-view cameras.

Under the new regulation, rear-view cameras must be built into all new vehicles under 10,000 pounds, including everything from super-small compact cars to large vans, but excluding some heavy-duty trucks.

According to a press release from the National Highway Traffic Safety Administration—the division of D.O.T. responsible for administering the rule—rear-view cameras will help reduce the annual average of 200 deaths and 15,000 injuries in accidents involving a vehicle backing up. Small children and the elderly are particularly vulnerable, the NHTSA said, and the new rules are expected to save between 58 and 69 lives a year.

The new requirement for rear-view cameras had initially been scheduled for implementation by 2014. Under the regulation announced Monday, the rule will begin enforcement in 2018, on model year 2019 vehicles.

TIME Automotive

Congress Pulls GM Over For Failing to Fix Defect

The General Motors logo outside its headquarters at the Renaissance Center in Detroit on Aug. 25, 2009.
The General Motors logo outside its headquarters at the Renaissance Center in Detroit on Aug. 25, 2009. Jeff Kowalsky—Reuters

A House subcommittee investigating the recall of 2.6 million Chevy Cobalts and other cars says GM ignored or dismissed several warnings about the danger of a defective ignition switch for a decade, and that regulators were also asleep at the switch

General Motors in 2005 twice neglected to fix a defect in ignition switches that has forced the company to recall 2.6 million cars and a federal regulator failed to investigate warnings about the defect, a congressional memo said Sunday.

The memo, released by the House subcommittee investigating the case, said that both engineers and the automobile giant’s brand quality division investigated the defect and proposed possible fixes during the spring of 2005. Some solutions were deemed too costly and time consuming to implement, while at least one other was canceled after initially being approved.

The faulty ignition switch, which has caused the Chevrolet Cobalt and other model cars to stall and has disabled the air bags and power steering, has been linked to 13 deaths.

A House Energy and Commerce subcommittee is currently investigating why General Motors didn’t recall the cars before this year, as the company first became aware of the problem in 2001 and was warned that the defect was linked to four fatal crashes in 2007. The company’s CEO Mary Barra will testify before the subcommittee in charge of the investigation on Tuesday and participate in a Senate hearing Wednesday, while an official from the National Highway Traffic Safety Administration is also testifying before lawmakers this week.

TIME Automotive

GM Freezes Chevy Cruze Sales

No recall has been announced for the carmaker's most popular model

General Motors has ordered a stop to most sales of its best-selling car model, the Chevrolet Cruze.

The company did not give a reason for the stop in sales, which affects most of the Chevrolet Cruzes on dealer lots today, CNN reports.

No recall has been issued for the compact car, but the announcement raised alarm bells among investors, sending GM’s stock down slightly in trading on Friday morning. The halt in sales follows an earlier recall of 1.6 million vehicles worldwide related to a faulty ignition switch linked to the deaths of at least 12 people.

[CNN]

TIME Automotive

Feds Close Tesla Investigation

Christie Appointees Ban N.J. Direct Sales for Musk's Tesla Cars
A Model S with sits on display at the Tesla store in the Short Hills Mall in Short Hills, NJ, Wednesday, March 12, 2014. Emile Wamsteker—Bloomberg/Getty Images

The National Highway Traffic Safety Administration is happy with the electric car company after it agreed to install more shields underneath its vehicles to prevent roadway debris from damaging its batteries and sparking fires

The United States’ federal highway safety regulator has closed its investigation into battery fires in Tesla’s Model S electric cars.

“A defect trend has not been identified,” the National Highway Traffic Safety Administration said in its report this week.

The regulator opened the investigation after three battery fires last year raised questions about the vehicle’s safety. The NHTSA said Tesla has made sufficient design tweaks to “reduce the frequency of underbody strikes and the resultant fire risk.”

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