Thursday, July 30, 2009
This is hot off the news....the government plans to suspend temporarily the Cash For Clunkers Program. The program offers $3500 to $4500 for trading in an older vehicle for a new more fuel efficient vehicle. The plan does require that only certain vehicles qualify for the program.
Apparently, it is so popular that they are concerned about exceeding the $1 billion dollars earmarked for the project. The plan would have applied to approximately 250,000 vehicles. Thru Wednesday 22,782 vehicles had been purchased thru the program.....with an estimated 25,000 deals had not yet been approved by the National Highway Transportation Safety Agency.
Members of congress from the auto producing states have approached the congressional leaders about extending the program. Rep. Candice Miller, R-Michigan indicated that "This is simple the most stimulative $1 billion the federal government has spend during the entire economic downturn".
As I outlined in my previous post this could be a great program for the auto manufacturers, dealers and the consumers that were able to take advantage of the program. Last month, over 850,000 cars were sold for the month. This program would apply to about ten percent of the sales over the three months of the program.
So, the government was serious about stimulating auto sales they would substantially increase the program. The small amount of one billion dollars is going to increase sales temporarily but will have no impact in the long term.
Update: The House of Representatives have approved an additional $2 billion in funding on July 31st to continue program. But, the Senate is holding back approval. The continuation of the program depends on that vote.
Wednesday, July 29, 2009
Chevrolet Volt is a game changer from General Motors (GM), in fact this could be one of the vehicles to save the venerable brand. The Volt is a plug in hybrid to be produced by GM, unlike current available hybrids like the Toyota Prius, the propulsion of the Volt is accomplished by the electric motors, it has a regular gas engine which recharges the batteries, but the gas engine does not power the wheels.
It's lithium-ion batteries have a range up to 40 miles (64 km), which exceeds the daily commute of 75% of Americans, which is an average of 33 miles (53 km). A small 4 cylinder gasoline engine drives a generator to provide a longer range. This effectively extends the Volt's potential range to as much as 640 miles (1,030 km) on a single tank of fuel, but the range could be extended indefinitely by refueling the vehicle. The Volt's lithium-ion battery pack can also be fully charged by plugging the car into a 120-240VAC residential electrical outlet.
Since the current Society of Automotive Engineers (SAE) definition of a hybrid vehicle states the vehicle shall have "two or more energy storage systems both of which must provide propulsion power, either together or independently", the company has avoided the use of the term "hybrid" when describing its non-conforming Voltec designs. Instead GM has described the Volt as an electric vehicle equipped with a "range extending" gasoline powered internal combustion engine. However, the combination of an internal combustion engine and electric motors in such a configuration is most often referred to as a series hybrid.
An optional feature will be a a thermovoltaic solar power roof, allowing the owner to charge the battery by leaving the vehicle in sunlight. GM has decided on a new descriptive terminology to distinguish it from traditional hybrids. They are calling the Volt an E-REV, for extended-range electric vehicle, although it still qualifies as a hybrid.
The estimated production plans are 10,000 first year with a ramp up to 60,000 units in the second year. Production in the U.S will be done at GM's Detroit/Hamtramck Assembly. GM is considering building all of the Volts for the European market, branded Chevrolet, Opel and Vauxhall, at their Vauxhall plant in Ellesmere Port in the United Kingdom. GM indicated that the Volt would be available for sale in Europe in 2011, then available in Australia by 2012.
General Motors was reportedly in disagreement with the United States Environmental Protection Agency regarding how the Volt should be tested to determine its official fuel economy rating. The EPA reportedly wants to alter the method of testing currently used for all other hybrid vehicles. If tested with the same EPA tests used by other hybrids, the Volt's ability to use the energy stored in the batteries would result in it achieving a fuel economy rating of over 100 mpg, which would make the Volt the first mass-produced automobile to achieve such a rating. Currently, the 2010 Toyota Prius has a combined city/highway rating of 50 mpg.
Pricing for the Volt in the U.S. is estimated at $40K plus, with a government tax incentive rebate of $7500 bringing the price to around $32.5K. Pricing in the U.K. market would be estimated at GBP£20K, less a government tax incentive rebate.
My take on this vehicle is that the Chevrolet Volt will be a game changer in a number of different ways. First, it will help to get GM sales and image back on track after the government sponsored bankruptcy, second it is a mass market vehicle that can change the hybrid landscape, which Toyota dominates presently. Third it will be a major milestone on the way to American energy independence!
Shown below is the original Volt concept vehicle!
Information via Wikipedia!
Tuesday, July 28, 2009
Today's post is on the new 2010 Chevrolet Equinox, which is a front wheel drive or all wheel drive five passenger crossover. I am not necessarily an SUV or crossover fan...but I do need to bring up that the crossover segment is going thru some major changes.
Crossovers are continuing to evolve and develop....the new Equinox is a prime example. The 2010 Equinox is a much better vehicle than the model it replaces. It shows GM's resolve to finally get back to building good cars.
The feature to the Equinox that I thought was interesting was the application of GM's Active Noise Cancellation technology. Basically, the there are microphones to monitor the noise level and the speakers generates the opposite sounds to cancel low frequency noises.
This technology has been in development for a number of years....automobile manufacturers are now beginning to deploy the technology. The benefits are that the 2010 Equinox is exceptionally quiet with noise and vibration to a minimum. There was an additional benefit to the deployment of the technology is that the engineers were able to drop the idle speed and gain an additional .1 mpg.
The standard 2.4 liter Ecotec direct injection motor is rated at 182 h.p. with a 0-60 time of 9.6 seconds. An optional 3.0 liter direct injection motor is available with 264 hp and a 0-60 time of 7.8 seconds. The only available transmission is a six-speed automatic. This is not a sports car but GM is working on meeting the new higher CAFE fuel economy regulations.
Fuel economy for the 2.4 liter is an exceptional 21/30 city/highway, meanwhile the 3.0 liter is rated at 18/25 city/highway. All wheel drive is available which should reduce the mileage by 1-2 mpg.
Note that Chevrolet has continued with the two tone interior which is similar to the Chevrolet Malibu. Personally, I find the new interior on the Equinox to be exceptional in the class. The main competitors are the Ford Escape, Jeep Liberty, Honda CR-V, Hyundai Santa Fe, and the Toyota RAV4. This is a substantial change from the prior model.
The new 2010 Chevrolet Equinox is another example that GM has decided to build good products. It has exceptional fuel economy without the necessity of a hybrid or diesel technology. It is an attractive crossover that is extremely competitive in it's class. These are the kind of cars that will bring GM back from the brink!
Monday, July 27, 2009
Here is an interesting article on the American psyche.....it is interesting to see people's perceptions. Based on a survey released today from Rasmussen Reports....46% of Americans are more likely to by a Ford than vehicles from GM or Chrysler. The reason is that Ford did not take bailout money from the government. Apparently, there is a lot of resentment against the bailout.
The latest sales report for June substantiates the survey. Ford sales were down only 11% and GM sales were down 33% and Chrysler down 42% respectively. GM was in the midst of the bankruptcy during June so that may have had an impact on the survey. Chrysler had already come out of the bankruptcy.
One issue not addressed in the survey is that Ford quality has been continually improving over the last few years. In addition, they have brought out some very competitive cars like the Fusion Hybrid, Taurus and the Mustang. So, both quality and competitive cars could be part of the increase sales.
Personally, I was incensed the way that Chrysler closed 789 dealers giving them a minimum of notice...whereas GM gave their dealers that they were closing over a year to wind down the business. Closing that many dealers in the month of June may have impacted Chrysler sales in that month.....so we will see how this trend continues.
In fact, there were a number of people and organizations that were burned by the bankruptcies. The worst were people that had been severely hurt by vehicle malfunctions that now do not have much recourse since GM and Chrysler have gone into bankruptcy. I will be doing a future post on the damages inflicted due to the bankruptcies.
Another interesting fact is that 41% of Americans expect the quality of GM cars to get worse now that the government is the majority owner.
I don't necessarily agree with all the perceptions that have been outlined by the Rasmussen survey. I did not like the fact that GM and Chrysler had to be bailed out...but I viewed it as the only scenario that would work to save a number of jobs and deepening an extremely severe recession.
I hope that the government will stay out of GM and Chrysler management. In two or three years, the economy will be rebounding and auto sales will be increasing materially. I suspect that the GM will prepare a stock offering and the government will be out within a couple of years after that.
Saturday, July 25, 2009
Today's post is on a very interesting new car the Porsche Panamera. Take a look at the picture above.....note the four doors. Yes, this is the first four door Porsche.....this appears to be a new trend with serious four door sports sedans.
The Panamera engines are a 300-hp V6 to the 500-hp turbocharged V-8. Apparently, a hybrid powertrain is also in development. The Turbo speed is 0-60 mph in four seconds....which is exceptional for any sedan. The transmissions are a six speed manual or the seven speed PDK automated manual is available.
Pricing for the Porsche Panamera will be $89,000 USD, a Panamera 4S, which is 4 wheel drive, will run $93,800 USD and the Turbo runs $132,600 USD plus options. The Pamamera maybe subject to gas guzzler taxes.
Friday, July 24, 2009
These technologies are gaining popularity since battery manufacturers have been in race to improve the battery life. Improving the battery life extends the driving range of the vehicle.
Fisker has signed a deal with Advanced Lithium Power (ALP) to provide batteries for the Fisker deal that was just announced. The battery life question has been overcome, since the Tesla Roadster won the Monte Carlo Rally For Alternative Energy Vehicles.
The Karma is powered by Q-drive technology, which is a series hybrid where the engine is mated with a generator to provide an electrical connection to the electric motors. Electric motors are what propel the vehicle, the engine recharges the batteries.The Karma has a feature that one day may become standard on electric cars. It has a factory option of a solar power roof that can assist recharging the lithium batteries and the climate control system.Also, Fisker will offer a set of solar panels for the garage/house which may charge the Karma entirely off the grid. Fisker automotive has not released information on the Karma fuel economy.
Pricing has been announced....the base version will cost $87,900 USD plus options, meanwhile an upgraded version EcoSport will be $95,000 and the top of the line EcoChic will cost $104,000.
This is one beautiful green machine! The first production units will arrive this fall.
The big news is how a relatively small company can develop a state of the art automobile from scratch with $100 million in start up capital! GM was unable to do the same thing with the EV1 for over $1 billion dollars.
Basically, they have contracted with existing automobile parts manufacturers for the parts necessary to build the car.....substantially cutting their cash requirements for designing parts, buying manufacturing equipment and building plants etc.
Friday, July 10, 2009
This post is about the J.D. Powers vehicle dependability study which rates automobile reliability after three years of ownership. Generally, this study determines the long term reliability of vehicles by make and brand.
Lexus has dominated the J.D. Powers vehicle dependability study since 1986. So this is shocking news that Jaguar and Buick have tied for the top spot and surpassed Lexus on the quality front. J. D. Powers dependability study surveyed owners of 2006 model year vehicles. Jaguar moved up from tenth place, meanwhile Buick moved up from sixth position from last year. Owners opinions of a cars reliability after three years can be an impact on their opinion to repurchase that auto brand again.
Auto makers watch the J. D. Powers reports closely since a positive report can increase or decrease sales. Shown below is the Jaguar XF, which is a new model for 2009 replacing the S-type.Cars have improved materially since 1986 and Lexus and Toyota have set the pace. In the J. D. Power report Lexus was in third place followed by Toyota. Mercury, Infinity and Acura take the fifth, sixth and seventh places in the survey. The worst performing brand was Suzuki, which is a Japanese brand.
The Buick LaCrosse, which was the highest ranked mid-size car, has basically been a sleeper in the automotive scene. It is a conservatively styled and designed car. It competes well against the Toyota Camry and the Honda Accord. Buick has been chosen as the GM division to compete against Lexus. Accordingly, the Buick LaCrosse will be totally redone for 2010 and looks quite impressive. Please see the June 3rd post on the 2010 LaCrosse.
This report basically shows that a number of brands are now competing with the Japanese on the long term quality of their vehicles. Ford has been on the upswing for the last couple of years...note the placement of the Mercury division. Credit does belong to Ford implementing the quality programs at Jaguar that developed this acclaim.
General Motors is increasing their quality at the same time.....the Buick division has been increasing reliability for the last five years. Many people have the perception that the American and British brands are inferior to the Japanese in quality. That may have been the case ten years ago but times are changing!
This story is based on an article written by Dan Strump the Associated Press news story.
Wednesday, July 8, 2009
Tuesday, July 7, 2009
Ford purchased Volvo in 1998 and one of the benefits was the Ford 500 which came out in 2005. The Ford 500 was underpowered and connected to a CVT transmission and did not sell well. The Ford 500 was based on the Volvo S80 platform and is one of the safest cars on the road. In 2008, the name was changed to the Ford Taurus and upgraded the powertrains.
The 2010 Ford Taurus is prime example of the quality car that American manufacturers are capable of producing. It has the 3.5-liter V-6 which makes 264 hp, which is connected to a six-speed automatic.. The Limited model comes with a different six-speed transmission along with paddle shifters.
Pricing for the Taurus SE starts at $25,170 USD plus options, while the SHO starts at $$37,170.
Monday, July 6, 2009
Today is a milestone of American history......General Motors (GM) is about to exit bankruptcy. This is one of the largest and the fastest bankruptcy in American history! The bankruptcy judge Robert Gerber has ruled that allowed to sell the bulk of the good assets to the new GM. This is the final procedure that will allow the automaker to emerge from bankruptcy protection.
The old GM will be renamed Motors Liquidation Co....and those assets not transferred to the new GM will remain and be liquidated. This process may take up to 2-3 years to finalize. The GM stock is still traded in the over the counter market....but is virtually worthless.
The speed of the bankruptcy was initiated due to the Obama administration requirement otherwise the government would refuse to provide GM with additional funds unless it was out of bankruptcy court by July 10th.
"As nobody can seriously dispute, the only alternative to an immediate sale is liquidation — a disastrous result for GM's creditors, its employees, the suppliers who depend on GM for their own existence, and the communities in which GM operates," a comment out of the Gerber ruling.
There will be a number of appeals....some are by people that are suing GM citing liable in several auto accident cases. Other are GM's bondholders, unions and consumer groups indicating that their needs were disregarded in bankruptcy. A group of the Chrysler bondholders took their objections to the Supreme Court last month, which delayed Chrysler's exit from bankruptcy....but the court failed to hear their case.The bankruptcy will allow GM to significantly reduce their debt....along with a renegotiated United Auto Workers(UAW) contract. GM will shed its non-profitable divisions Saturn, Pontiac, Hummer, Saab and Opel.
The new GM has an image problem.... baggage from the old GM....they are perceived as a auto company that is out of touch with the needs to the American public. GM grew fat and bloated and thought that whatever they built would be bought by the public.
Unfortunately, the public has some incredible choices....so the new GM will have to bring some dynamic vehicles to market. Then it will take a few years to change the public perceptions. Some of the cars that GM was building lately are actually very good cars....unfortunately most people have the old perception that GM cars stink!
When the bankruptcy is completed, GM will receive about $50 billion tax dollars. The government will own 61% of GM. The Obama administration has indicated that they will be hands off owner....but they have already selected AT&T Inc. CEO Ed Whitacre to chair the board. Whiteacre rebuilt AT&T after they were substantially down in market share and profits after the government sponsored breakup of AT&T.
GM will be a better company after this reorganization! I had predicted that this would be the solution back in my February 16th post...Time GM To Pay The Piper. GM will not have the substantial debt to service, the UAW has made substantial concessions to reduce the man hour cost. They have eliminated much of the dead weight that had accumulated over the years.
In the past, I had been very critical of the GM board. They should have replaced the CEO and President Rick Wagner since GM continued with substantial losses and declines in market share. As a shareholder, I would have been extremely upset.
Since, Ed Whitacre will be chairman of the board, expect positive things to happen. He knows how to run a large business and make it successful. The new GM will be a much better company....with products and service to match.
Saturday, July 4, 2009
Mercedes is bringing out the new 2010 E-class to the U.S. with the 3.5 liter V-6 and the 5.5 liter V-8. It is testing the waters in the U.S. to see if buyers are ready for a 2.5 liter 4-cylinder turbo-diesel version of the its popular E-class. The E-class was selected for the 2.5 liter since Mercedes wanted to meet the new CAFE standards in the U.S. without downsizing vehicles.
At the 2009 New York Auto Show , Mercedes introduced the E250 BlueTEC, a diesel concept designed specifically for North America. This model is powered by a 2.2-liter 4-cylinder turbocharged diesel which produces 204 hp. when compared to the E320 BlueTec V-6’s 211 hp and 398 lb-ft figures.hp and 369 lbs.-ft. of torque.
The 2.5 liter motor is currently available in Europe and around the world. The diesel motor features some high tech features as high-pressure common-rail direct injection and twin Lanchester balance shafts for smooth operation. The only transmission is a 7-speed automatic.
The emissions system has been changed to meet stringent U.S. emission laws, the E250 BlueTEC uses a particulate trap, two catalytic converters plus an AdBlue urea injection system to reduce NOX emissions.
The car is equipped with a 25 liter tank for urea(component of urine), which is scheduled to be replenished at about 15,000 miles. If the tank is not replenished after a short period after the urea is empty.....then the vehicle will not start.
Mercedes line of diesels (Bluetec) will qualify for the federal alternative powertrain tax credit. This credit was only for hybrid vehicles, but it has been changed to allow diesel vehicles. A decision has been made that the diesels meet the Alternative Motor Vehicle Credit standards of the IRS. The credits vary based on the vehicle.
Pricing has not been announced for this vehicle!
The Mercedes E250 BlueTec should be a great green machine. This should allow someone to drive a green luxury car with great mileage...without sacrificing driving dynamics. Based upon the horsepower....the E250d will be slightly slower than the E350d which has a respectable 0-60 times. They have not announced the speed and braking information.
If fuel goes over $4.00 per USG these vehicles will sell like hot cakes!
Friday, July 3, 2009
Ford and GM sold more cars in June and cut the downward spiral sales for the month. During April, Ford and GM sales were down 11.2% and 33% respectively. An interesting fact is that GM is currently in bankruptcy and the bankruptcy has not impacted sales badly. Meanwhile, Chrysler who just came out of bankruptcy was down 42%.
- Chrysler down 42%
- Mazda down 42%
- Mitsubishi down 42%
- General Motors down 33%
- Toyota down 32%
- Honda down 30%
- Mercedes down 23%
- Nissan down 23%
- Volkswagen down 23%
- BMW down 20%
- Hyundai down 20%
- Ford down 11%
- Kia down 5%
- Volvo up 1%
- Subaru up 3%
Ford's Fusion set a record of 18,561 cars breaking into the top three mid-size sedan market for the second month since July 2002. The Ford Fusion and Mercury Milan have the best predicted reliability among all mid-size sedans. The Japanese brands have dominated the mid-size segment with the Toyota Camry and the Honda Accord.
June sales were up at a fairly decent run rate of 10 million cars annually. So, it appears that consumers had more faith in the future to spend money on high ticket items.
An interesting anomaly is that sales of Japanese brands continue with the downward spiral meanwhile U.S. manufacturers seem to be improving. We will have to monitor to see if that is a trend that will continue!
Thursday, July 2, 2009
Many of my previous posts have covered new electric cars and hybrids.....it appears that the electric revolution has started. There are two trends that are influencing electric car development, the first is the price of fuel, which is anticipated to increase substantially, the second is global warming.
Since, automobiles contribute substantially to global warming the smart idea to to eliminate the by products of the internal combustion engine. So, an electric car substantially reduces both major issues.....today's post covers a new electric car by Chrysler the Dodge Circuit.
Chrysler has lagged behind in the development of green vehicles but Chrysler executives said the day is coming when the whole Chrysler fleet has electric powertrains. "The goal is to achieve fundamental technology, get economies of scale, improve our ability to make the future generations more robust, less cost, smaller, more powerful, better performance," according to Bill Press V.P & President. "Ultimately it will lead to a transformation of our entire fleet that will be in some manner electric drive."
The Dodge Circuit EV sports car, is a two-passenger, rear wheel drive, all electric sports car that combines a lithium-ion battery pack with a 200-kilowatt motor, capable of generating 268 horsepower. The 0-60 mph. time is less than 5 seconds and with a top speed of approximately 120 mph (190 km/h). This car is built by cooperation with Lotus Motors and is almost identical to the Tesla Roadster.
The Circuit is based on the European Lotus Europa S...it includes a 268 horsepower electric motor as well as an advanced lithium-ion battery. Chrysler indicates that the Circuit has a range of 150 to 200 miles, which is similar to the Tesla Roadster.
Pricing has not been announced but the base price of a European spec Lotus Europa S is £33,000 $54,120 USD. That price does not include the changes to electrify the vehicle....the similar Tesla Roadster starts at $109,000 UDS.
Tesla started this new paradigm of using another manufacturers vehicle shell then adding the electric systems. This is substantially cheaper way to manufacture a car without starting from the ground up. It is another salvo in the beginning of the electric revolution!