The American auto industry has always faced stiff competition against foreign manufacturers. But Detroit's Big Three - General Motors, Ford and Chrysler - have really taken a beating over the last few years. Soaring manufacturing costs have hampered production, forced plant closures and left tens of thousands without jobs. Rising gasoline prices and sticker shock sent potential customers running for cover to less expensive, more efficient models. (For more information on owning a car, check out The True Cost Of Owning A Car.) TUTORIAL: Budgeting Basics
And then there was that little matter of an economic crisis that wreaked havoc on the financial nuts and bolts of the industry. But after some tough sledding, the auto industry seems poised for a rebound, and car makers are pulling out all the stops to create fuel-efficient, fun-to-drive, attractive and affordable vehicles.
It's not surprising that the Big Three are focusing for the most part on smaller vehicles, but they're also redesigning tried-and-true favorites that earned Detroit its moniker, "The Motor City". Here are a few examples of the cars that American automakers are banking on to revitalize the industry stateside.
Ford Focus & Focus Electric
The Focus was introduced in North America in 1999 for the 2000 model year in three styles: as a hatchback - perfect for small families; a compact four-door sedan; and a larger four-door wagon. It quickly became one of the top sellers in America, but fell out of favor with increasing competition. However, the 2012 edition has been redesigned to include high-tech interior options, like keyless ignition, touch-pads on the steering-wheel and a rearview camera. It also has a sleeker, sportier exterior and is listed as the eighth most affordable small car, with an average price of $16,500-22,900. Ford is also set to throw its hat into the electric car ring with the Focus Electric model, scheduled to launch later this year. (To learn more on Ford and how it started, check out Henry Ford: Industry Mogul And Industrial Innovator.)
Ford Mustang & Taurus
Among Ford's other offerings are its again-redesigned Mustang, ranked the top muscle car on the market. Its 305-horsepower V6 engine, tweaked steering and suspension settings and estimated 31 mpg highway help make this baby a keeper. Also, redesigned to attract a hipper audience is the Taurus, which has been ranked the best large car for the money (average price runs between $25,000-33,000).
While automakers are always scrambling for new designs, Chrysler made very few changes on its 300 model, which debuted as a concept car in 2004 and came on the market a year later. The company has since given new life to its next generation 300 - more elegant exterior styling without veering from its recognizable form, added interior touches and a little more vroom under the hood. It's also the only car in its class with rear-wheel drive, and is available with a HEMI V8.
Chrysler is the smallest of the Big Three automakers, but launched a wildly popular "imported from Detroit" ad campaign during this year's Super Bowl, which featured rapper Eminem. The campaign gave the company instant credibility among young consumers. Chrysler also just repaid its government bailout loan, so small or not, the company is moving in the right direction. (For help on buying a new vehicle, check out New Wheels: Lease Or Buy?)
If there is one car that will give the Ford Focus a run for its money, it's the Chevy Cruze. New for 2011, the Cruze, which starts at an affordable $17,000, replaces the Cobalt, which replaced the Cavalier (both good sellers). But pricing aside, the Cruze was designed to attract a wider driver audience. Frugal shoppers will look at the ECO model with 28/42 mpg city/highway. It's family-friendly with a roomier interior than its predecessors, and the Insurance Institute for Highway Safety gives it an excellent rating.
Chevrolet Impala & Volt
GM also recently announced that it will be building a next-generation Chevrolet Impala at its Detroit-Hamtramck plant that opened in 1985 for the production of Cadillacs. Production of a snazzier Impala will begin in 2013. Meanwhile, GM is amping its target production of the full-sized Chevy Volt electric car from 16,000 cars in 2011 to 60,000 next year, signaling a huge push for the clean energy vehicle.
Consumers with a need for speed can also be on the lookout for a kinder (but not gentler) Camaro. It's easy on your wallet with an EPA rating of 29 mpg highway, but moves with nostalgic power and pizazz. The new-age Camaro should be neck-and-neck with the Ford Mustang - just like years ago. (To find out if electric or hybrids cars are right for you, read Hybrids: Financial Friends Or Foes?)
The Bottom Line
Experts are predicting that U.S. automakers are on the rebound. Shares and profits are up; sales are on the rise, and the Big Three seem to have emerged from the financial crisis intact and ready to move on. And while challenges remain and automakers shouldn't count their proverbial chickens before they hatch, all signs are pointing to a positive, upbeat road ahead. (For more on these companies, check out Analyzing Auto Stocks.)