“The Hummer H3 ReEV is the first range-extended electric vehicle based on a full-sized SUV,” powertrain developers FEV claim ahead of an unveil at the Society of Automotive Engineers (SAE) hoe-down. Yes, on April 20, the world will be shocked—shocked!, I tell you— as FEV’s Hummer H3 Range-Extended Electric Vehicle (ReEV) proves that a “Raser scalable plug-in series hybrid design provides 40+ miles all-electric range and 100+ mpg fuel economy.” FEV says it performed the full vehicle integration (i.e., built the thing) and developed all software for the hybrid control unit and in-vehicle graphical display. Sweet! But I’m not sure what differentiates the FEV mule from a Chevrolet Tahoe Hybrid, or an Dodge Aspen Hybrid—other than the possibility that the gas – electric HUMMER H3 may be slower than continental drift with a top end that just about beats walking while stuffed to the rooftop with batteries. But apparently not . . .
TTAC doesn’t “do” press embargoes. While some of our writers have put me in the awkward position of respecting their desire to respect a manufacturer’s prohibition on publishing a review until the appointed second (I kid you not), if someone sends me anything other than private correspondence, I feel free to publish it. This evening (Monday), the Insurance Institute for Highway Safety (IIHS) e-mailed TTAC a couple of pdfs (click here or here), They were embargoed until one minute after midnight, Tuesday. So I immediately decided to publish them. Besides, big whoop; Pentagon papers these ain’t. It’s an anecdotal study of three—count ’em, three—crashes. The match ups: Toyota Yaris/Toyota Camry, Honda Fit/Honda Accord, Smart Fortwo/Mercedes C-class. What’s up with the lack of inter-brand rivalry? Apparently, “the smallest cars do a comparatively poor job of protecting people in crashes.” Huh. And just in case that’s a bit tame (despite the usual photos), the IIHS did some number crunching on fuel economy. They’d like you to know that “even though fuel economy is their biggest selling point, many cars just a little bit bigger get close to, or the same mpg as the mini and micro cars tested.”
OK, so here’s the latest chapter in GM’s decades old inability to face reality. GM CEO Fritz Henderson told Automotive News [sub] that there’s nothing wrong with GM’s viability plan (or the company’s management leading up to its $22.8 illionb federal “loans”). GM simply failed to, uh, perform. “The viability plan, when you look at the finding, they basically said they appreciated what had been done—actually quite a bit of what had been done is correct. What they really said was they wanted things to go deeper and faster.” Uh, not as I recall it: “The plans submitted by GM and Chrysler on February 17, 2009, did not establish a credible path to viability,” pronounceth The Presidential Task Force on Automobiles (PTFOA). “In their current form, they are not sufficient to justify a substantial new investment of taxpayer resources.” Of course, the PTFOA gave GM $4.4 billion to tide them over to C11 anyway. And if you think I’m just milking this “deeper faster” thing for cheap laughs, well, here it is again . . . and again . . .
The mayor of Duncanville, Texas had a member of the city council arrested last Tuesday for speaking out against the use of red light cameras during an official meeting. The incident took place during the discussion of whether the city should spend $59,000 to make street repairs. Mayor David Green recognized Councilman Paul Ford to speak on the contract item. “Thank you,” Ford said. “I want to let you know that earlier this evening during briefing, Mayor Green threatened me that if he told me to stop talking and I didn’t, he’d have me arrested, and I want to let you know what I told Mayor Green.” Green became outraged and shouted, “Mr Ford, you are out of order. You are not recognized Mr Ford. You need to cease right now.” While Green yelled, Ford continued his brief statement without stopping. . .
OK, it’s pretty clear how this is going down . . . On June 1, GM will file for Chapter 11. The Presidential Task Force on Automobiles will help the company split into “good” GM and “bad” GM. The “good” GM will probably consist of Chevrolet and Cadillac, including the factories and management that produce some (all?) of the brands’ models. It will raise money from a public equity sale ($15 billion?) and investment banks ($10 billion?). It will use the money to buy the cherry-picked assets from the diseased company. The “good” GM will get up and running in a relatively short time; TTAC’s Ken Elias makes it 90 days or so. The owners of the “bad” GM—abandoned dealers, the United Auto Workers, suppliers, etc.—will squabble over their payouts into perpetuity. So, Ken and I have a bet. I say the PTFOA will direct that US taxpayers get a share of the new, good GM, as compensation for “our” $22.8 billion worth of worthless loans. Ken says Uncle Sam will write if off. Legally, Ken’s right: the feds can’t jump to the head of the creditors’ queue. But I say they will. What say you?
In general, TTAC does not cover motorsports. But we’re on the ball when it comes to the business of automotive sponsorships for sports of all sorts. We recently reported that Ford—Detroit’s last man standing—is a major sponsor of curling. The wisdom of that choice has become clear, as the the Men’s Curling Final was one of the most exciting ever played. As The Canadian Press reports, “It was a game for the ages. The final game of the Ford World Men’s Curling Championships came down to the last rock in the 10th end to break a 6-6 tie between Canada’s Kevin Martin and David Murdoch of Scotland.” Nail-biting stuff and perhaps symbolic of Ford’s last ditch struggle to stay out of bankruptcy court.
CAHIBOstep, TTAC’s biggest fan on our Facebook page, writes:
My owner’s manual recommends 91 octane gasoline for my turbocharged five-pot (Volvo T5). There’s no 91 octane gas in Illinois, only 87, 89 and 93. When I was at the gas station the other day, I decided that instead of buying 93, I would mix equal parts 89 and 93 to get 91 (89 + 93 = 182/2 = 91).
Does this actually work? Does this make me the cheapest person in the world?
The Maryland General Assembly yesterday gave final approval to a measure that will expand the use of speed cameras to every part of the state, allowing cameras on high-volume freeways for the first time. Lawmakers in Annapolis, at the urging of Governor Martin O’Malley (D), saw the measure as an essential means of reining in the state’s run-away budget deficit. Traffic camera vendors also helped promote the effort with lavish gifts, parties and campaign donations. The new legislation specifically authorizes the use of speed cameras anywhere in the state up to one-half a mile away from a school zone. School zone cameras can operate as late as 8pm and ticket motorists regardless of whether school is in session.
Someone. Make. This. Stop. Now that the MSM has woken up to GM’s impending government-sponsored, C11, they’re beginning to understand that this is the only the end of the beginning, not the beginning of the end. The New York Times headline (and Autoblog) may proclaim a “surgical” bankruptcy for The General, but the bottom line is buried with in the text. “Treasury officials are examining one potential outcome in which the “good G.M.” enters and exits bankruptcy protection in as little as two weeks, using $5 billion to $7 billion in federal financing, a person who had been briefed on the prospect said last week.” Using the top figure, that brings our total “investment” to $25.8 billion, of which $18.8 billion is a total write-off. And, as I’ve pointed out here many times, then there’s the next bit. “The rest of G.M. may require as much as $70 billion in government financing, and possibly more to resolve the health care obligations and the liquidation of the factories, according to legal experts and federal officials.” So call it $100 billion just to get going. Government Motors (a.k.a. American Leyland) is born.
Motown’s top suits are [still] insulated from “the ownership experience.” They drive carefully selected and prepped examples of their own products, lovingly serviced by the company’s top wenches. I mean wrenches. The company replaces these perkmobiles before they can prove the old adage that getting older is not for sissies. The execs don’t experience the slings and arrows of outrageous service departments nor, for that matter, their competitors’ products. They are the bubble boys, accompanied by buff book writers. In this month’s Motor Trend, the chronically undercapitalized arthur st antoine offers this: “Full disclosure: At the moment, I don’t own an automobile. There are too many test cars, too little time.” So the st receives a new, carefully selected, meticulously prepped and thoroughly maintained press car EVERY WEEK. A full tank of gas, no insurance, no trips to the dealer (ever). None of the hassles of car ownership AND the unexpressed danger that writing something that takes him off the press car gravy train would costs him thousands of dollars per year. Now, about this month’s column. . .
Uh-oh. News of GM’s upcoming demise has reached China. On the Kübler-Ross grief chart, GM China’s emotional cycle has departed from denial, probably hit some (internalized) anger and is now in the bargaining phase. Depression, testing and acceptance will follow in due course.
GM China called a press conference and trotted out Kevin Wale, president of GM China Group himself. He put on a brave face: Even if General Motors meets the worse-case scenario—bankruptcy, its operations in China won’t be affected and will expand further as they have been making profits and have abundant funds and technologies, Wale bragged according to Gasgoo. Customers and dealers in China are rightly beginning to wonder how GM China will fare if the mothership gets torpedoed or broken up. (Read More…)
“Shanghai car-maker SAIC makes approach for Vauxhall,” headlined London’s Telegraph over the weekend. Of course SAIC doesn’t want just the Vauxhall badge, they are interested in the whole Opel/Vauxhall enterprise. What looks like “Opel” through German eyes looks like “Vauxhall” to the British. It’s one and the same.
According to the Telegraph, “Shanghai-based SAIC has requested a sale document from General Motors (GM), the stricken US car-maker, which has warned that it may file for bankruptcy in an effort to ensure its survival. Commerzbank, the German banking group, is orchestrating the sale process on behalf of GM, which is to establish a new subsidiary comprising Vauxhall and Opel, the German car manufacturer. A new investor would be invited to acquire a controlling stake in the company, with GM potentially retaining a minority interest.” Saab and Chevrolet Europe would not be part of the deal. More Chinese interests are lining up: (Read More…)
Less than a generation ago, speed was the name of the game. Hands-on automotive enthusiasts would swap their car’s two-barrel carb for a four, replace the manifold, straighten the exhaust, anything and everything to make their ride go faster (at least in a straight line). Even the mechanically ignorant knew that power equalled status, whether under-hood or at their fingertips (windows!). These days, consumption is no longer a disease; it’s an addiction. Where once we laughed watching my buddy Artie’s ’69 Camaro’s fuel needle fall, the new Honda Insight has a needle showing me how much fuel I’m saving. It’s not a very clever insight, but the Insight is a very clever car.
Did I say laugh? I meant to say “analyze.” As in pore over spreadsheets, crunch numbers, make projections, hold meetings, exchange emails, examine market trends and fill out endless time sheets and expense reports. I imagine that TTAC’s Best and Brightest could save the Presidential Task Force on Automobiles (PTFOA) some money; how much does it cost to make up a rubber stamp that says “FUHGEDDABOUTIT”? So, anyway, Bloomberg winkled-out the payment from the PTFOA to The Boston Consulting Group. “‘A very significant portion’ of work will be to analyze GM’s restructuring plan and Chrysler’s proposed alliance with Fiat SpA, according to the notice posted on FedBizOpps.gov. Boston Consulting must work with the Treasury Department and GM to craft a ‘financial plan acceptable to the government.'” Meanwhile, LinkedIn profiles PTFOA chief Steve Rattner’s former employer, Quadrangle Group. And wouldn’t you know it: “Quadrangle Group employees are most connected to:” Lazard (hired by the United Auto Workers to investigate GM’s finances in 2005; and by Chrysler last August to sell the Viper model as a business), JPMorgan (big time Chrysler debt holders and bailout recipients) and The Boston Consulting Group. Click on BCG, and “The Boston Consulting Group employees are most connected to:” McKinsey and Company. Whose clients include GM and Ford. Small word. Big bill. Yours.
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