Automakers Aim for Affordability at Show

The LA Auto Show this year featured cars for customers looking for higher mileage and lower prices as shown in the Dec. 5, 2009, broadcast of the "Evening News."
The LA Auto Show this year featured cars for customers looking for higher mileage and lower prices as shown in the Dec. 5, 2009, broadcast of the "Evening News."
CBS

Glitz, glam and a cool concept car used to be enough to turn heads at the LA Auto Show.

But in Los Angeles this week there's a new concept: affordability, reports CBS News Correspondent Ben Tracy.

"We have to be about having vehicles that people want to buy at a price they can afford at high volume," General Motors spokesman Dave Barthmuss told Tracy.

U.S. carmakers saw a spike in sales during cash for clunkers this summer. But last month sales at all of the Big Three automakers were down year to year. Now carmakers are trying to appeal to bargain-minded shoppers.

Photo Essay: 2009 LA Car Show

"These days, people want their dollar to work as hard for them as they ever have in their lives," Mark Fields, president of the Americas for Ford Motor Co., told Tracy.

So Ford's big reveal is one of the smallest cars they've ever made in the U.S. - the redesigned Fiesta. It gets 40 miles per gallon and costs $19,000.

To create buzz, Ford gave Fiestas to 100 Internet savvy 20-somethings for six months. They Tweeted and YouTubed their way to millions in free advertising.

"A lot of young people don't really watch TV anymore," Fiesta test driver Tim Chantarangsu told Tracy. "If they're watching TV, it's online."

Everyone is watching General Motors. Their CEO abrubtly resigned this week and the company recently emerged from bankruptcy. GM is launching it's 40 miles per gallon Chevy Cruze and says the Chevy Volt - it's long awaited plug in hybrid - will finally hit showrooms in 2010. Only struggling Chrysler had nothing new to debut.

The L.A. Auto Show is critical for U.S. carmakers because California is the No. 1 new-car market in the country. It's also a trendsetter when it comes to fuel efficiency.

U.S. automakers are getting on the green bandwagon trying to compete with Asian manufacturers and meet higher government mileage standards. But Americans typically shun compact cars, and hybrids are expensive.

"The manufacturers have to develop these cars and push them onto the market and pray that consumers will start buying them," auto industry analyst Rebecca Lindland told Tracy.

Manufacturers also need to pay back billions in bailout money to American taxpayers.

"The best way to do that is to sell vehicles and to make money," Barthmuss told Tracy.

As long as they get American car buyers in the driver's seat.

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On the Web

LA Auto Show: http://www.laautoshow.com/

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    Ben Tracy is a CBS News White House correspondent based in Washington, D.C.