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Dealers mobilize to protect their margins from automaker subscription services

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

Next BMW X1 moving to smaller, lighter FWD-biased platform

BMW's decision to make the upcoming 2-Series Active Tourer front-wheel drive has been polarizing to say the least, but like it or not, that is the direction the company will go in the near future - one rumor put the number as high as 23 front-wheel-drive models for Mini and BMW combined. The next-generation X1 won't send all its power to the front wheels, though, when it launches in early 2016. While it will use the same platform as the Active Tourer, rumors suggest all models will use all-wheel drive - at least at launch.
A "high-ranking," unnamed BMW manager confirmed to AutoWeek that the new model will switch to transversely-mounted three- and four-cylinder engines and the same six-speed manual and eight-speed automatic transmissions as the Active Tourer. The new, smaller platform will allow for more efficient packaging, and despite the smaller size, interior space will remain comparable. All the changes should make it significantly lighter too.
Don't start wailing just yet because BMW surely won't be entirely abandoning sporty models. AutoWeek claims that the Bavarians are working on a higher-output version of the 2.0-liter turbocharged four-cylinder with power closer to 300 horsepower, about a 72-hp boost. It's also rumored to offer a sporty version of the X1 that may be called the X2.

The importance of Angel Eyes, Ventiports and four round taillights

Just the other day, we told you about how Lincoln isn't really a luxury brand, according to Ford's head design man, J Mays. His argument was that Lincoln lacked the unique DNA to differentiate it from the rest of the market, although the arrival of the MKZ is beginning to change that. Now, we have this video from Autoline Detroit, where Jim Hall, an analyst for 2953 Analytics who was quoted in yesterday's Lincoln story, explains the influence of certain styling cues and how they impact the brands.
Using BMW (Angel Eyes) and Buick (Ventiports) as examples for small, simple touches that serve to distinguish the brand's vehicles on the road, Hall then points out how changing trademark styling features, as Chevrolet has done on the new Corvette Stingray, can hurt the vehicle's public perception. Take a look at the full video below for an interesting dive into what these styling features mean to their individual brands.