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Home > Of the Year > Cars > 2010 Motor Trend Car of the Year: Ford Fusion
2010 Motor Trend Car of the Year: Ford Fusion
2010 Coty Header
Check Dealer Pricing On a New Ford Fusion!
2010 Motor Trend Car of the Year: Ford Fusion
The Comeback Kid: Do-it-All Sedan is Reborn for 2010 and is Better, Smarter, Nicer, Prettier, Comfier, Leaner, Meaner, and Greener in Every Way
November, 2009
 / By Matt Stone
 / Photography by Wesley Allison

2010 Ford Fusion Se Sport And Hybird
 Click to view Gallery
In 1964, Motor Trend’s Car of the Year award went to the entire Ford lineup, recognizing its combination of design, engineering excellence, and performance. In 1970, we gave the nod to the Ford Torino, which could be ordered in a wide variety of configurations. Forty years ago, buyers could choose from economical, six-cylinder-powered sedans to the dragstrip-ready 429 Super Cobra Jet fastback. These legendary winners had one thing in common: bandwidth. In the 1960s and ’70s, this term wasn’t yet part of popular lexicon. Today, the 2010 Ford Fusion’s impressive bandwidth as a model range was one of the many factors that helped it earn the 2010 Motor Trend Car of the Year award.

Want an economical midsize sedan that doesn’t cost much, yet won’t bore you to tears? Need to please your greener side with a high-tech hybrid? Fancy a near-sport sedan with AWD, 18-inch rolling stock, and the latest infotainment and electronics? Depending on which model you choose and how many option boxes you tick, the Fusion can be any of the above. Arthur St. Antoine calls the Fusion “a compelling sweep across one of the market’s most hotly contested segments.”

The original Ford Fusion came to market for the 2006 model year. The basics were there, but the car wasn’t fully baked. For 2010, Ford’s product teams gave the lineup a soup-to-nuts redevelopment so thorough, it’s as if the first-generation car never existed. Only the passenger-shell sheetmetal and other basic architectural elements escaped being redesigned, upgraded, or replaced. Although a four-door sedan is the only body style offered, powertrain choices expand from two to four, and each is new or substantially revised. There are several trim levels offered as well: base S, upmarket SE, luxurious SEL, a separate Sport model, and a Hybrid. Early in this year’s COTY program, there were quiet whispers, while heads nodded, about how the Fusion looked, felt, and drove like an entirely new machine.

For car buyers, four words mean the difference between going home in a new sedan or their old clunker: Your loan is approved.

They are being uttered more often these days, spurred by a trillion-dollar government program that provides guarantees when those loans are sold to investors. That is helping banks, credit unions and auto finance companies make auto loans at a quickening pace. And consumers are paying less to borrow. Interest rates have been at record lows since last December.

It’s bit of good news for the auto industry in the U.S., where 2009 sales are expected to hit a 30-year low of around 10 million when figures are announced Tuesday. Partly because of loosening credit, industry analysts expect more than 1 million cars and light trucks to be sold in December, the best monthly performance since Cash for Clunkers in August.

Financial firms wrote 5.5 percent more car loans in the third quarter compared with the prior three months, Experian Automotive says. Fourth-quarter figures aren’t yet available, but Jesse Toprak, vice president of the auto pricing tracker TrueCar Inc., says December saw an uptick in auto loan approvals for consumers with average or above-average credit as auto finance companies tried to clear out inventory.

Paul Taylor, chief economist for the National Auto Dealers Association, said used-car prices also have stabilized due to limited supply, making used-car loans more attractive to banks.

Still, Toprak said it could take another year or even longer for financial firms to trust consumers enough to return to normal levels for auto lending. It’s also far from the freewheeling days of the credit boom. Third-quarter auto lending was down 30 percent from the same period in 2006, a year when U.S. car and light truck sales reached 16.5 million.

In the meantime, only those with good credit need apply.

A top-tier borrower – someone with a credit score between 720 and 850 – can get a 36-month auto loan with an average monthly rate of 5.74 percent, down from 6.65 percent a year ago, according to Informa Research Services, a financial research firm headquartered in Calabasas, Calif. On a $20,000 car loan, that’s a savings of nearly $300 over three years.

But the cost of borrowing has risen for people in the bottom tier. A person with a score of 500 to 589 has seen the average rate climb to 18.56 percent from 16.47 percent a year ago. That translates to an extra $751.68 over 3 years. Banks are still nervous about loaning money to risky borrowers given high rates of unemployment, foreclosures and late payments since the financial crisis began.

“We used to have a subprime auto lending industry,” says Dan Alpert, managing partner at Westwood Capital, an investment bank involved in the securitization business. “We don’t have that anymore.”

Although demand for autos has picked up from depths seen at the start of 2009, the lending machine really got moving thanks in large part to grease from the government’s TALF – or Term Asset Backed Loan Facility – program. The program began last March and allows investors to borrow money from the Federal Reserve to buy the loans off lenders’ books. This raises money and makes room for financial firms to write more loans.

There is evidence it’s working. Financial institutions raised more than $19 billion by selling securities made of bundled auto loans in the third quarter last year. That’s up nearly 60 percent from the second quarter and more than sixfold from the same period in 2008, according to the Securities Industry & Financial Markets Association.

TALF is scheduled to end in March 2010. Whether the market for securitized loans can stand on its own at that point depends on the state of the economy, lending experts say.

The concerns are similar to those in the housing market, where tax credits for first-time home buyers have helped prop up demand. But those credits expire April 30. And loan activity, in general, has been weak. According to the Federal Reserve, loans by the nation’s 8,000 banks have fallen 8 percent to $6.7 trillion in the past year, and some analysts expect them to keep falling at least through next year.

But there are good signs. The proportion of loans – auto and other – requiring TALF support has declined steadily over the past several months and should continue to fall early this year as the market for securitized loans continues to improve, says Tom Deutsch, deputy executive director of the American Securitization Forum, an industry group that represents those who turn debt into bonds.

“It should be relatively easy to wean off TALF,” he says.

In the meantime, the easier lending market has helped car buyers like Marissa Corbitt, who last month bought her first-ever car with a loan from Nissan’s financing arm, NMAC.

Corbitt, a 24-year-old accountant from Chattanooga, Tenn., was able to negotiate the cost of her 2010 Rogue down several thousand dollars to about $20,500 after some incentives. She said she was then pleasantly surprised by the interest rate NMAC offered her for the crossover.

“Nissan was offering a 2.9 percent APR, so I got that,” said Corbitt, whose top-tier credit score helped her case. “It’s a good interest rate.”

George Pipas, Ford Motor Co.’s top U.S. sales analyst, says the industry appears to have passed through its lowest point and is trending toward a slow recovery.

“The situation is still fragile,” Pipas said. “You can’t walk away from concerns about employment and income.”

PPG Industries (NYSE:PPG) announced today John R. Outcalt has been appointed vice president, automotive refinish, and will assume global responsibility for PPG’s automotive refinish business effective March 1. Outcalt is currently vice president, automotive refinish, Americas. He will continue to be based at PPG’s automotive refinish business headquarters in Strongsville, Ohio, and to report directly to J. Rich Alexander, senior vice president, Performance Coatings.

Outcalt joined PPG’s automotive OEM coatings business in 1983 as marketing services manager on the Chrysler account. After progressing through various marketing, marketing services, technical, sales and management positions within automotive OEM coatings, Outcalt became director of network sales for automotive refinish in 1996.

Outcalt then served as director of collision center operations and director of sales, North America, refinish, before joining PPG’s insurance and services business as general manager. In October 2005, he served as general manager, refinish, United States and Canada. In December 2007, Outcalt was named to his current position.

He received his bachelor’s degree in business administration from Baldwin-Wallace College.

About PPG
Pittsburgh-based PPG is a global supplier of paints, coatings, optical products, specialty materials, chemicals, glass and fiber glass. The company has more than 140 manufacturing facilities and equity affiliates and operates in more than 60 countries. Sales in 2009 were $12.2 billion. PPG shares are traded on the New York Stock Exchange (symbol: PPG). For more information, visit ppg.com.