US automakers in pole position at Detroit auto show

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Indy Lifestyle Online

US automakers take a victory lap at the Detroit auto show next week after a remarkable recovery from years of red ink, a steady loss of market share to Asian rivals and the bankruptcy of General Motors and Chrysler.

GM posted a two-billion-dollar third quarter profit and then launched the biggest initial public stock offering in history in November, just 16 months after emerging from a government-financed bankruptcy.

Chrysler - which didn't even host a press conference at the Detroit auto show last year because its product offerings were so old and weak - managed to increase its market share in 2010 and will be introducing two highly anticipates new models on Monday.

Ford, the only one of the Detroit Three to survive the deepest downturn in decades without government aid, regained the number two spot in the US market from Toyota for 2010 after its share grew for the second year in a row.

"It's a bit of a coming-out party for them, frankly," said Jeff Schuster, an analyst with JD Power and Associates.

"The overall expectation would be for a much more upbeat show as well as expectations for the year."

After crashing in late 2008 and dropping to the lowest level since the 1983 recession, US auto sales rose 11 percent in 2010 to 11.6 million vehicles.

With sales forecast to rise to 12.5 to 13.5 million units this year and Toyota still smarting from a series of mass recalls, the prospects for big gains are good.

"If (the Detroit Three) can make money at depression level sales it tells you something dramatic has changed," said David Cole, chairman of the Center for Automotive Research in Ann Arbor, Michigan.

"If we get back to 13, 14, 15 million units, this is going to be an astonishingly profitable business."

There is plenty of competition.

More than a dozen automakers will vie for the attention of 4,500 journalists on Monday with the presentation of 30 to 40 worldwide debuts.

There will be a continued focus on green cars as automakers revamp their lineup to meet tough new emissions standards.

Toyota will be expanding its popular Prius hybrid with the introduction of a new wagon and executives are expected to make a big announcement about future products.

GM will launch its new subcompact - the Chevy Sonic - introduce a new compact Buick and is also expected to tout its plug-in hybrid Chevy Volt which recently hit showrooms.

Ford could also announce plans for its upcoming electric car, Tesla will be showing off a luxury electric sedan and Chinese automaker BYD will be pitching a compact E6 electric sedan which is scheduled to hit dealerships this year.

"The risk to the marketplace is that consumer aren't asking for these," said Rebecca Lindland, an analyst with IHS Automotive.

Hybrid auto sales fell last year to 2.4 percent of the US market from 2.8 percent in 2009, according to Autodata.

And while automakers are touting the fuel savings of their compact cars, the cost savings often aren't enough for comfort and storage-seeking American consumers.

"Crossovers are easily the big winners," Lindland said. "They get pretty decent fuel economy and they can carry five to eight people with some stuff."

Luxury car fans will get plenty to see at the show.

Porsche has returned after a four-year absence with the introduction of a new Spyder coupé, BMW is showing several new models including the 650i convertible, and Daimler will show a new Mercedes-Benz C class sedan. Audi and Bentley will also be making an appearance.

Volkswagen will introduce its highly anticipated NMS sedan, the cornerstone of a strategy to ramp up sales in the world's second largest automotive market as VW seeks to overtake Toyota for the top spot worldwide.

Several "concept" vehicles are also expected, including a boxy crossover by Kia with gullwing doors, a new version of Honda's popular Civic sedan, and a beefy crossover by Mini.

The North American International Auto Show launches with a press preview Monday. It opens to the public January 15 and runs through January 23.

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