Same-Day Analysis: NAIAS 2016: Premium brand introductions take charge at Detroit Auto Show
Pre-show intelligence suggests that at least four all-new premium brand sedans (Genesis, Lincoln, Mercedes-Benz, and Volvo) will be introduced, along with sports coupés from Infiniti and Lexus. Among the premium-brand introductions, SUVs may take a back seat.
IHS Automotive perspective
- Significance: Particularly among premium/luxury brands, more sedans than SUVs or crossovers will be introduced at NAIAS 2016, along with a healthy dose of performance models.
- Implications: Although US consumers still display a preference for SUVs, product lifecycle developments have conspired to weigh the schedule in favour of sedans, particularly for premium brands.
- Outlook: The show will be the backdrop for premium brand statements, from the latest versions of the Mercedes-Benz E-Class to the Volvo S90, along with Hyundai's North American introduction of its upcoming Genesis brand. Although the list of introductions favours large sedans, the outlook for this segment remains for largely flat sales, as consumers continue to prefer SUVs. However, these entries are also statement vehicles for the established brands. They continue to represent important volumes, set the tone for the brands, and often provide the platform for introducing new technology to the brands..
The 2016 North American International Auto Show (NAIAS), with media and industry days scheduled for the week of 11 January 2016, promises to hold several significant new car introductions. Also, being held on the heels of the Consumer Electronics Show (CES, held in Las Vegas on 6-8 January), technology and concept announcements made there will continue to be sources of discussion throughout NAIAS.
Acura will be showing the future of its sedan family design, with the Acura Precision Concept, as well as having the NSX in full production form make an auto show appearance. The company is keeping the concept under wraps until the formal reveal, sharing only a teaser image ahead of the show. Acura appointed a new chief in July 2015, Jon Ikeda. Ikeda has said in interviews and presentations since that the brand's next concern is updating its sedan lineup - with about 63% of its 2015 sales being sport utility vehicles (SUVs), the brand has found a more successful formula for its SUVs than its cars. We expect this concept to communicate a more distant vision of Acura's future design. With Ikeda having come to lead the division through the design side of the house, Acura may continue to elevate its focus on design going forward.
Audi has confirmed a concept and discussion of its future technology implementation for CES, but for NAIAS the company is rumoured to be bringing an SUV concept, the Q6 h-tron, as well as a production car. The production car is not confirmed, but widely speculated to be either the A5 or Q5. The Q6 h-tron concept is likely to be a follow-up on the e-tron Quattro concept shown at the 2015 Frankfurt Motor Show, and suggests Audi is looking at further applications for hydrogen fuel-cell technology. The brand showed an A7 Sportback h-tron Quatro concept at the 2015 Los Angeles auto show.
One of the most closely watched introductions will be Hyundai's introduction of its new premium/luxury brand, Genesis. The brand will launch with the next generation of the car currently known as the Equus, which will be named the G90. Hyundai is beginning a long journey with the creation of a brand intended to take on Mercedes-Benz, BMW, Acura and Lexus, though has really been working toward this ultimate goal since introducing the first generation Genesis sedan. The G90 was introduced in South Korea in November 2015, with the NAIAS the first auto show introduction.
Infiniti's primary news will be the Q60 coupé. The two-door is a platform-mate to the Q50 sedan, and will also feature the new engine family. In the weeks ahead of the show, Infiniti released information on the new 3.0-litre V-6. The new engine will replace the venerable 3.5-litre V-6 engine. Infiniti's QX60 SUV also takes a facelift and the 3.0-litre engine. We forecast that the Q60 will perform well, injecting a sporting personality in the showroom, with global sales in the range of 17,000 units per annum and providing between 6% and 7% of Infiniti's global volumes.
At the 2015 New York Auto Show, Lincoln surprised many with the introduction of the Continental concept. At NAIAS, the production car is set to be revealed. For Lincoln, the vehicle is the next step in its efforts to revive. The MKC and MKX have been well received, but the Continental is part of a segment under pressure as consumer tastes continue to shift toward SUVs. Sized near the Mercedes-Benz E-Class, Lincoln's global volumes will be much smaller. The future of the Lincoln brand largely rest on its ability to grow in China, as that market presents a higher volume opportunity than the mature US market; Lincoln is not a notable player in most other global markets. The sedan is due to go into production at Ford's plant in Flat Rock, Michigan, United States.
Mercedes-Benz will show two convertibles and introduce an all-new E-Class. The SLK has had a facelift and a new name, the SLC, while the Mercedes-AMG S65 is also due. The E-Class is expected to raise the Mercedes' bar on semi-autonomous features, beyond the latest S-Class. The E-Class moves to Mercedes' MRA Mid-Size platform, a rear-drive architecture introduced first under the C-Class. The E-Class is the company's second-best seller globally, behind the C-Class. Although E-Class sales are expected to have contracted in 2015 as the model was in changeover, sales of the new generation are forecast to regain to about 318,000 units in 2017. A coupé is also in the works, expected for early 2017.
Volvo is using its NAIAS stage to introduce the all-new S90 sedan, which replaces the ageing and slow-selling S80, using the same scalable product architecture (SPA) of the XC90. Volvo released photos and initial details in December. Volvo is still on its journey of revival, with the XC90 making strong strides in proving the brand's capability for luxury and technology. The S90 will follow on that strong note, and include a hybrid powertrain as well. IHS forecasts that it will perform better in the market than the S80, but is also expected to remain a comparatively small player. In contract to Mercedes' E-Class sales, the S90's global sales are forecast to reach about 52,000 units in 2017. Volvo has been aggressive in its introduction of advanced infotainment features and working heavily on developing autonomous and semi-autonomous solution, including a concept at the Los Angeles show focused on re-imagining an interior able to convert from driver to driverless space and announcing at CES that it is working to develop intelligent, high bandwidth streaming capabilities for future autonomous vehicles. The S90 will be the first to add large-animal detection to its forward emergency braking systems as well as a system to keep the car in its lane up to 81 mph without relying on recognising and following a car in front of it. While remaining a smaller volume player, Volvo has come on strong with hi-tech, luxury entries.
Along with these key entries, NAIAS will serve as a backdrop for other performance-oriented premium models. Lexus is expected to deliver a production coupé to be called LC. Using an new rear-drive platform and the 5.0-litre V-8 from the RC F and GS F coupé and sedan, reports suggest a possible USD100,000 price tag to compete with the likes of the Mercedes-Benz SL - we have not seen the product yet, and it also has potential to turn out to be one of the "stars" of the show. BMW's presence at NAIAS will focus on its M performance brand, with the M2 coupé and X4 M40i SUV slated for introduction. Porsche is due to show the 911 Turbo family at NAIAS, a 540-hp Turbo and 580-hp Turbo S and US sales in April 2016.
Outlook and implications
At time of writing, the 2016 NAIAS is poised to favour premium cars. The show will be the backdrop for premium brand statements, from the latest versions of the Mercedes-Benz E-Class to Volvo S90, along with Hyundai's North American introduction of its upcoming Genesis brand. Although the list of introductions favours large sedans, the outlook for this vehicle segment remains for largely flat sales, as consumers continue to prefer SUVs. However, these entries are also statement vehicles for the established brands. They represent important volumes, set the tone for the brands, and often provide the platform for introducing new technology to the brands. The performance entries are similarly important from an image perspective, though they do not carry similar volume potential.
About this article
The above article is from IHS Automotive Same-Day Analysis of automotive news, events and trends, and is a deliverable of the World Markets Automotive Service. The service averages thirty stories per day and also provides competitor and country intelligence. Get a free trial.
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