World Car Information

Where Auto Insurance Is Most Expensive

2010-04-19T05:09:00.000-07:00

Louisiana has the highest average auto insurance rates in the United States, while Maine has the lowest, according to new data from Insure.com that ranks the states according to their average insurance rates (see the full ranking below).

The data, which Insure.com released Monday, comes from a study Quadrant Information Services performed for Insure.com to find the most and least expensive vehicle to insure nationwide, which we covered in a March Bucks post. The data, which determined average insurance premiums rates for more than 2,400 vehicles from the 2010 model year from six large carriers across 10 ZIP codes in each state, also enabled a comparison of auto insurance rates in general across the states.

What's behind states' different rates?

According to Insure.com, states' different laws are partly to blame. "Our findings show that the financial ramifications of specific state laws and regulations are driving high rates in certain states," Amy Danise, senior managing editor of Insure.com, said in a statement. "No matter how good your own driving record is, you're paying for the decisions of lawmakers."

Ms. Danise said she had expected to see states with more urban areas at the top of the list but Insure.com discovered from talking with insurance agents that the states at the top of the list have certain regulations that drive up rates in those states. In Louisiana, for instance, more cases are settled out of court with expensive settlements because only cases with claims in excess of $50,000 receive a jury trial there. In Michigan, meanwhile, which had the second-highest average auto insurance rates, state law provides unlimited medical benefits for accident victims for life, probably pushing up auto insurance costs, according to Insure.com.

In contrast, population levels may be why certain states are at the bottom of the list. According to Ms. Danise, the states with the lowest insurance costs tend to be more rural. Maine, for instance, may have low auto insurance rates because its highways are less crowded, which may mean fewer crashes over all.

Here's the full ranking below, and let us know if it lines up with your experiences buying auto insurance in different states.

The most and least expensive states for car insurance:

Rank	State	Avg. Premium
1	Louisiana	$2,510.87
2	Michigan	$2,098.29
3	Oklahoma	$1,869.39
4	Montana	$1,857.96
5	California	$1,774.41
6	South Dakota	$1,772.83
7	Washington, D.C.	$1,753.19
8	Georgia	$1,751.42
9	Illinois	$1,679.15
10	Connecticut	$1,678.90
11	Arkansas	$1,648.80
12	New Mexico	$1,603.65
13	Rhode Island	$1,595.97
14	West Virginia	$1,589.69
15	Alaska	$1,572.21
16	Wyoming	$1,552.98
17	Maryland	$1,550.13
18	Kansas	$1,524.51
19	Kentucky	$1,515.30
20	Colorado	$1,480.97
21	Mississippi	$1,474.94
22	New Jersey	$1,473.73
23	New York	$1,463.21
24	Texas	$1,462.65
25	Florida	$1,453.20
26	Pennsylvania	$1,420.78
27	Delaware	$1,405.80
28	Missouri	$1,390.59
29	Minnesota	$1,381.09
30	Alabama	$1,380.38
31	North Dakota	$1,365.22
32	Hawaii	$1,306.97
33	Indiana	$1,302.51
34	Nevada	$1,282.50
35	Washington	$1,279.84
36	Utah	$1,234.30
37	Virginia	$1,233.36
38	Nebraska	$1,210.74
39	Oregon	$1,194.69
40	Idaho	$1,183.47
41	South Carolina	$1,182.18
42	Tennessee	$1,170.12
43	Arizona	$1,152.50
44	North Carolina	$1,130.45
45	Massachusetts	$1,043.80
46	Iowa	$1,039.04
47	New Hampshire	$1,011.23
48	Wisconsin	$1,010.93
49	Ohio	$999.86
50	Vermont	$968.58
51	Maine	$902.85

Source: Insure.com, from a study commissioned by Insure.com from Quadrant Information Services

Toyota set to agree on record fine, AP source says

2010-04-19T05:08:00.000-07:00

WASHINGTON – Toyota Motor Corp. is expected to agree to a fine of more than $16 million for failing to promptly report to the government problems with sticking gas pedals on its vehicles, a Transportation Department official said.

Toyota faces a Monday deadline to accept or contest the $16.4 million fine, the largest ever assessed by the government against an automaker, over evidence it knew about the defective gas pedals in September but did not issue a recall until January.

Under federal law, automakers are required to notify the government within five business days when they find a potential safety defect.

The Transportation official said Toyota is expected to pay the full amount of the fine within 30 days as a way of avoiding going to court against the government. The official was not authorized to speak publicly and spoke only on condition of anonymity.

The official said Toyota did not intend to admit wrongdoing explicitly but the company still faces dozens of personal injury and wrongful death lawsuits in federal courts. Federal prosecutors and the Securities and Exchange Commission are conducting investigations related to the recalls.

From the government's viewpoint, the official said, the agreement to pay the full fine constituted an acceptance of responsibility for hiding the safety defect in violation of the law.

Toyota declined comment on the fine.

Toyota announced it would recall 2.3 million vehicles in January to address sticking pedals on popular vehicles such as the Camry and Corolla. The Japanese automaker has recalled more than 8 million vehicles worldwide because of acceleration problems in multiple models and braking issues in the Prius hybrid.

The fine was based upon timelines provided by Toyota that showed it had known about the sticky pedal defect at least since Sept. 29, 2009, when it issued repair procedures to distributors in 31 European countries to address complaints of sticking pedals, sudden increases in engine RPM and unexpected vehicle acceleration.

The documents also indicated that Toyota knew that owners in the U.S. had experienced the same problems.

The Japanese automaker has been weighing its options since the fine was announced in early April but analysts expected it to pay the penalty.

"When you look at the toll it's taken on Toyota's reputation, when you look at the number of vehicles involved, when you look at the hardship it's placed on Toyota's customer base, it's only right for Toyota to take this fine," said Dennis Virag, president of Automotive Consulting Group based in Ann Arbor, Mich.

The penalty is the largest the government can assess under law. Without the cap, government lawyers said Toyota could have faced fines of $13.8 billion, or $6,000 for each of 2.3 million vehicles that were sold with defective pedals.

Transportation officials have not ruled out additional fines. The department is reviewing whether Toyota delayed for six weeks the late January recall of the 2009-2010 Venza in the United States to address floor mats that could entrap the accelerator pedal after making a similar recall in Canada.

Toyota recalled the Venza in Canada in December and reported to the U.S. government on Dec. 16 that the floor mats could move forward and interfere with the pedal. Toyota told U.S. authorities at the time that the floor mats in question were not imported into the U.S. but the Venza was added to the floor mat recall in late January.

Toyota to suspend production for 11 days in Japan

2009-01-06T03:27:00.000-08:00

TOKYO – Toyota is suspending production at all 12 of its Japan plants for 11 days over February and March, a stoppage of unprecedented scale for the nation's top automaker as it grapples with shrinking global demand.

The last time Toyota Motor Corp. halted production at all its Japan plants was in August 1993, when demand plunged because of a rising yen, and that was for only one day, according to the company.

A global economic downturn has hammered the auto industry in Japan and elsewhere, forcing carmakers to cut staff, lower production and delay new models. Major automakers in the U.S. had teetered on the brink of collapse until securing a multibillion dollar government lifeline.

"We are coping with a slump in global sales," Toyota spokesman Hideaki Homma said Tuesday. "Demand in the world auto market is so depressed that every model is falling sharply in sales."

Toyota said last year that it was stopping production at its 12 domestic plants for three days in January. But it decided on additional closures because of the global downturn. Toyota will stop output for six days in February and five days in March, it said.

Of Toyota's domestic factories, four produce vehicles while the rest make engines and auto parts.

Overnight, Toyota reported that its U.S. sales in December were down 37 percent on year, a worse drop than Ford Motor Co.'s 32 percent drop and General Motor's 31 percent slide.

Toyota last year suspended production at its auto plants in Alabama, Indiana and Texas for three months, and shut down output for two days in December at all its North American vehicle factories including five in the United States, one in Canada and another in Mexico.

Chrysler LLC also shut down its plants for a month in December, longer than the usual two-week break, while GM has said it would shut down a plant in Thailand for up to two months.

Toyota is also struggling in its home market, which has been stagnant for years. The sales drop has worsened amid a global recession.

Sales of new vehicles in Japan fell to 3.2 million vehicles last year, the lowest in 34 years, the Japan Automobile Dealers Association said Monday.

Last month, Toyota said it was slipping into its first operating loss in 70 years, expecting 150 billion yen ($1.66 billion ) of operating losses for the fiscal year ending March 2009.

Toyota, which makes the Prius gas-electric hybrid and Camry sedan, expects 50 billion yen ($555 million) in net profit, down from 1.7 trillion yen earned the previous year.

Toyota projects first operating loss since 1941

2008-12-22T08:16:00.000-08:00

NAGOYA, Japan – Toyota Motor Corp. projected its first-ever operating loss since it began such reports, acknowledging Monday that its nine-year stretch of global vehicle-sales growth had stalled.

Crashing auto demand, especially in its key U.S. market, and the profit erosion from a surging yen proved too much for Japan's top automaker, which had been booming on the success of its fuel-efficient models, incluading the Camry sedan and Prius gas-electric hybrid.

Gloom dominated the annual news conference by Toyota's president, who in recent years had outlined ambitious expansion plans. This year, Toyota President Katsuaki Watanabe even refused to give a worldwide vehicle sales goal for 2009.

"The tough times are hitting us far faster, wider and deeper than expected," he told reporters at Toyota's Nagoya office. "This is an unprecedented crisis requiring urgent action."

Watanabe also blamed the strong yen, which has risen to 13-year highs against the dollar to about 90 yen recently.

Toyota lowered its net profit forecast to just 50 billion yen ($555 million) for the year through March 2009 — a tiny fraction of the 1.7 trillion yen it earned the previous fiscal year.

Toyota expects to lose money on an operating basis of 150 billion yen ($1.66 billion) for the fiscal year ending March 2009. Toyota has never reported an operating loss since it began giving such figures in 1941. The only such loss it has had is an internal calculation for the year ending March 1938, a year after the company was founded.

Operating income reflects a company's core business performance. Last fiscal year, Toyota had a whopping operating profit of 2.27 trillion yen.

Toyota also lowered the number of vehicles it expects to sell globally this calendar year to 8.96 million, down 4 percent from a year ago. Earlier this year, Toyota had expected to sell 9.5 million vehicles around the world in 2008.

Initially, it had an even more aggressive target of 9.85 million, and expectations had been growing that the tally would reach 10 million in coming years — allowing Toyota to dethrone General Motors Corp. as the world's top automaker.

Watanabe vowed Toyota would grow so lean it would realize profitability even if its worldwide sales slid to as low as 7 million vehicles — what he called the basic "bottom line" for Toyota.

"We must change to become more slim, muscular and flexible," he said.

Tsuyoshi Mochimaru, auto analyst for Barclays Capital in Tokyo, warned worse may be ahead. U.S. auto sales won't start recovering until toward the end of 2009, and the dollar may lag further, he added.

"The problem is next year," said Mochimaru. "It's unmistakable that things are extremely tough for Toyota."

Watanabe and other executives said production plans and other investment will be on hold, including a new plant in the southern U.S. state of Mississippi and expansion plans in India.

The automaker will focus on hybrids and small cars, and invest in ecological technology to prepare for long-term growth, they said.

Mitsuo Kinoshita, a Toyota executive, said he hoped the results for the fiscal year through March would mark a bottom, partly with the help of dropping material prices. Soaring prices of steel and oil had hurt automakers, but such costs have fallen back in recent months.

But unfavorable currency shifts will slash 200 billion yen ($2.2 billion) from its results for the fiscal year through March, while marketing activities, including measures to deal with sinking sales, trimmed another 570 billion yen ($6.3 billion), according to Toyota.

While Japan's automakers are in far better financial shape than their cash-strapped American counterparts, the global slowdown is hitting them hard.

At a similar news conference last week, Takeo Fukui, president of No. 2 Japan automaker Honda Motor Co., also lowered profit and sales forecasts and declined to give a vehicle sales goal for 2009.

Toyota said it will reduce temporary workers at its Japan plants to about 3,000 by March from an earlier 6,000. Full-time employees will have job security.

Toyota is a relatively old-style Japanese company that offers lifetime employment, and only in recent years has hired and let go of temporary workers to adjust production. It was reviewing overseas jobs but had not reached a decision, it said.

Monday marks the second time Toyota reduced its forecast. Initially, it had projected 1.25 trillion yen ($13.9 billion) in net profit for the year through March 2009, but last month lowered that to 550 billion yen ($6.1 billion). It lowered its fiscal sales forecast to 21.5 trillion yen ($239 billion), down about 18 percent on year.

Toyota's U.S. vehicles sales plunged by a third on year in November, when overall sales fell to their lowest level in more than 26 years. And there is little hope for a quick fix as consumers hold back big purchases amid a credit crunch, rising unemployment and fears about the future.

"The change that has hit the world economy is of a critical scale that comes once in a hundred years," Watanabe said.

The company's stock fell 5 yen, or 0.17 percent, to 2,895 yen in Tokyo.

Top Ten Favorite Cars Of Retirees (AKA: Top Ten Cars To Avoid On The Road)

2008-11-07T20:04:00.000-08:00

With most consumers favoring smaller foreign cars and the US auto industry seemingly headed for the toilet, there is still one demographic that Detroit has a solid hold on… Retirees. Buyers over 65 are the last hope for the good old American car. In some dealerships, upwards of 85 percent of all Buick buyers are 55 and older. That’s an ominous sign for the future of American autos.

The over-65ers look at brands like Buick, Lincoln and Cadillac as status symbols. Those brands have what advertisers call the “Mind Share” in that demographic. Retirees remember a time when the only people driving those cars were celebrities and other high profile members of society; now they want in to that high-profile group of Cadillac drivers. Plus, older folks like familiarity, they know these brands, they’ve heard them their whole life.

Check out the list of the top ten cars most popular with retirees:

What’s going to happen when this generation of retirees stops driving? It’ll be bad news for US car-makers since studies have shown that younger generations (even the baby boomers that are almost ready to retire) prefer sporty, performance type vehicles as opposed to the large cloud cars on this list. So Detroit is going to have to reshape it’s image if it wants to get a piece of the future retirees. As for now, here are the best sellers with the old folks:

10. Ford Taurus

Ahh yes, the King of the American Roads. The Taurus is one Ford’s best selling models, in fact it was the best selling car in the 90s PERIOD. Ford went through some weird phase where all the cars had names starting with ‘F’. They got rid of the Taurus title and called it the “Five Hundred”, which was a moronic move considering the name recogition they had with the original name. Either way, the Taurus is back now, and old people still love it; 35% of all buyers are 65 years old or older.

9. Lincoln MKZ

Compared to the rest of the cars on this list, the Lincoln MKZ is small. I know, only on a list of retiree’s favorite cars could a 3,500 pound sedan be considered small. In actuality, it’s still a big car with lots of interior room. It’s marketed to a somewhat younger demographic, but just like the Taurus, 35% of it’s buyers are 65 or older.

8. Cadillac STS

The STS is probably the “sportiest” car on this list, although like the rest of the cars, it has a roomy interior and the blind spot/back up cameras that older people like. Retirees love the Cadillac brand, they remember it as being the ultimate car brand. 39% of all Cadillac STS buyers are over 65.

7. Toyota Avalon

The only foreign car on the top ten list is Toyota’s flagship sedan. That’s because Toyota specifically designed the Avalon to compete in this particular market of over-65ers.

A lot of auto magazines have called the Avalon a “Japanese Buick”. In 2005, Car and Driver even rated it at the top of a group of premium sedans, a niche where American cars usually dominate. Because of all that press, it’s gaining popularity with the retirees, 39% of all Avalons sold went to them.

6. Mercury Sable
The Sable is the Ford Taurus’ upscale cousin, and just like it’s always been, it’s essentially just a Taurus with a Mercury badge. Old people love it though, nearly half of all Sables sold (48.5%) have gone to people over 65.

5. Buick LaCrosse
The top five on this list is where the real favorites are; there is a substantial jump in the percentage of over 65 buyers as we go from #6 to #5 on the list: Only 48.5% of all Sables want to old folks, meanwhile, almost 64% of all Buick LaCrosse sales were to people over 65.

The LaCrosse is a roomy sedan, although it a bit smaller than it’s brother the Lucerne. It has old folk favorites like OnStar, power seat memory buttons, and radio controls on the steering wheel. We’re in the over-50% zone now, so it’s a safe bet to avoid all Buick LaCrosses you see.

4. Buick Lucerne
The Lucerne is sort of the beefier version of the Buick LaCrosse, plus is has the all-important parking assist and back-up cameras. It also has an interesting electronic system called Lane Departure Warning system that alerts the driver if the car starts to move out of it’s lane. Good to know. Still, with a full 67% of all Lucerne’s out there belonging to over 65ers, I’ll still steer clear of them, lane departure warning or no.

3. Mercury Grand Marquis
The Mercury Grand Marquis costs a little more than half the price of the Lincoln Town Car, and the two cars are virtually identical. I have never understood it. Same engine, nearly the same interior size. They both have a trunk large enough to hold a small herd of elephant seals. Plus, I actually like the look of the Grand Marquis better than the Town Car. Maybe when I turn 65 I’ll change my view. If you discount cops and other fleet drivers, a full 69% of all Grand Marquis drivers are over 65.

2. Cadillac DTS
The DTS is slightly larger and less sporty than the STS. It’s actually a direct competitor to the Lincoln Town car, so appeals to retirees for all the same reasons. Brand recognition, quality image, and it has a lot of electronic whiz-bangs and doodads, like the same lane-departure warnings and blind-spot alerts that many of the other top ten have.

Honestly, there is about a RCH of difference between the Caddy DTS and the STS. The STS is a bit bigger and costs a little more, but that’s where the differences end.

1. Lincoln Town Car
Who else but the Town Car, the godfather of old man cars. More than 75% of all Town Cars out there on the road today are driven by someone over 65, so keep an eye out. The Town Car is probably one of the roomiest sedans for less than $100k. It has more interior space than the flagship BMW 7 Series and Mercedes-Benz S-Class. The car is just the archetypal old man car: huge interior, rear-wheel drive, floating-on-a-cloud suspension, plush seats, and a powerful engine. Great combination for the over 65ers, bad one for you and me, since grandpa can be cruising at 85 and not realize it until he plows into your Jetta. Watch out for Town Cars.

By the way, all the cars on this list get less than 20 mpg in the city, and less than 30 mpg on the highway.