$8.2m it turns out (yes, sins of omission count). Which is almost as much as the wages of investing in a fraudulent cellulosic ethanol firm. But what about Fritz, Lutz, LaNeve and the rest of the gang that couldn’t shoot straight? If Wagoner gets nearly $10m for overseeing consistent declines in sales and market share, and after being canned for the good of the nation, where’s the motivation for the old, new crowd? Ditto for the cellulosic ethanol industry, if Cello’s fraud leads to increased subsidies to get the Renewable Fuel Mandate back on track. Forget peak oil, it seems we’ve reached peak common sense. A while ago. Now, back to the cars.

Edmunds Inside Line reports that Alabama-based Cello Energy, which was supposed to produce 70 percent of the EPA’s 100m gallon/year cellulosic ethanol goal, has been convicted of fraud. A jury has awarded over $10m in damages to investors after witnesses testified that Cello’s supposedly biomass-derived fuel was actually petroleum based. Furthermore, it turns out that Cello only has the capability to produce 20m gallons of its putative biofuel per year. The EPA’s Renewable Fuel Standard (RFS2) had banked on Cello to produce 70m gallons per annum. The downside? If (when) America’s cellulosic ethanol producers fail to meet the 100m gal/year mark inn 2010, the EPA could sell credits which would increase the biofuel’s price to $3/gallon. Current futures place the fuel’s value at $1.77/gallon. Alternatively, the EPA could postpone the ramp-up to 100m gal/year… but who’s expecting that to happen? Meanwhile, so-called “second-generation” biofuels continue to act as a subsidy magnet for an industry that is wholly addicted to feedstock-based fuels and government assistance.

Ok, today’s QOTD was actually typed yesterday, as Alpha jet-deprived New GM Car Czar Bob Lutz faced the slings and arrows of outrageous internetocracy on Fastlane. Stan:

In my group it is just uncool to drive a GM car -even if they are as good as the imports. Is your marketing studies researching why this is. I could give you an ear full and fit the urban professional demographic. I want to see GM get that desirable one day!

Lutz’s reply (and our quote of the day) after the jump.

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Automotive Traveler cites confidential sources inside GM as saying that GM’s Caprice (neé Pontiac G8) will be built in Oshawa, Canada. According to AT’s sources, the Impala’s age is hurting it in police fleet sales. The Caprice would presumably fix that and potentially squeeze a few more sales out of the Zeta platform. But it also flies in the face of recent revelations that Fritz Henderson is “not a fan of rebadging” (in regard to the G8, no less), and that the Impala is moving to the Epsilon II platform. Are we seeing the beginnings of a Lutz-Henderson rift?

GM Bankruptcy lawyer Harvey Miller confirms what Steve Rattner’s departure from the Presidential Task Force On Autos suggested, telling Bloomberg “I really believe that by the end of August, the task force will be gone.” Miller explains that “the winding down of Old GM and Old Chrysler will take a significant period of time, but it will not involve anything like the task force. It will be an ordinary liquidating bankruptcy.” Rather than the bankruptcy code-shredding process that recently wrapped up. The credit market is going to take it from here. “I’ve been around a long time in this business and I’ve heard financial institutions say, ‘We will never lend another penny to this industry’ on the basis of this decision in bankruptcy court or elsewhere,” says Miller. “Three or four months later, they’ve totally forgotten. There is no institutional memory in this world.” At least the last part of that is dead on. The rest? Perhaps a tad optimistic. Most likely, some form of government guarantees will be necessary to convince banks that GM is creditworthy. Otherwise, its $50b debt load to the taxpayers and internal turmoil make it a poor target for private investment. But, hey, why not give it a whirl?

Because, why not? Thanks to the American taxpayer, Fiat didn’t have to pay for Chrysler. But China’s First Auto Works (FAW) and others are bidding for Bertone Carozzeria, so Fiat stump up real, actual money, says Automotive News [sub]. For a coach builder (last project: the Opel Astra convertible of 2000-2005) which was just bailed out by the Italian government in 2007. And is only going to auction because of a family feud (via AN [sub]). Now that is what you call adding insult to bailout.

With the Malibu mild-hybrid out of the picture and the Volt project still in integration testing, GM-Volt.com reports that the General is developing a “dedicated hybrid” model alá Prius and Insight. According to GM’s Ed Peper, the 4-banger manual Malibu’s 33 highway mpg makes the extra cost of a mild hybrid a tough sell. Besides, a hybrid has to look like a hybrid to earn its eco-premium, right? But isn’t that what the Volt does? Unless, of course, GM wants an eco-halo that it can (possibly) make money on. In which case… duh? Either way, if GM plumps for a dedicated hybrid alongside the Volt, it will mean more development cost, more cannibalism, and more signs of death-thrashing. Time to pop those focus pills, GM. Again. Still.

“People don’t want cars named after hungry old Greek broads! They want names like ‘Mustang’ and ‘Cheetah’ — vicious animal names,” according to Homer Simpson’s automaker brother Herb. Yesterday I learned another good rule of thumb for car naming: if it doesn’t sound hilarious with the word “anal” in front of it, it’s probably not a great car name. Think about it… Commander, Wrangler and Legacy good; CTS, MKT and Optima bad. It may not be safe-for-work, but dammit it’s the truth.

According to the Detroit News, both Ford and GM are looking at unifying their full- and mid-sized car platforms around a single platform in hopes of capturing economies of scale. Ford will move future Taurus and Fusion models to its European (Mondeo) C/D platform, while GM is looking at basing a future Impala on the Malibu’s Epsilon II platform. The Ford Flex/MKT would also likely move to the C/D platform, leaving the Taurus/Current Flex’s D3 platform available for the next generation Explorer.

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From Reuters comes word that Car Czarlet Steven Rattner will be leaving the Presidential Task Force On Autos. The move “represents the start of a long-planned wind down of the autos panel” according to Reuters’ interpretation of an anonymous White House source. “With GM’s restructuring complete, Steven Rattner, whose leadership and vision were invaluable to the Auto Task Force’s efforts, has decided to transition back to private life and his family in New York City,” explains a statement from Treasury Secretary Timothy Geithner. “We are extremely grateful to Steve for his efforts in helping to strengthen GM and Chrysler, recapitalize GMAC, and support the American auto industry. I hope that he takes another opportunity to bring his unique skills to government service in the future.” Unique skills? Is Rattner getting blown off or is this Mission Accomplished? A little of both?

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This weekend’s announcement that “Maximum” Bob Lutz will stay on at GM is the biggest blow to GM’s re:invention PR since Fritz Henderson was handed the helm by Rick Wagoner. In essence, Lutz’s “unretirement” sends the very same message Wagoner once repeated ad nauseum: GM’s turnaround would be going well if it weren’t for that darn economy. And, of course, nothing could be further from the truth. Lutz arrived at GM in 2001 with a single thesis: excitement could turn the General around. Eight years later, and the results speak for themselves. Despite injecting Pontiac with its best products in decades, Lutz couldn’t even save GM’s “excitement brand.” Though Lutz created the Malibu to add his aesthetic appeal to GM’s long-ignored mid-sized offerings, the car only excited automotive journalists. Consumers preferred the plain-jane Impala. Ultimately, Lutz proves exactly how little GM has changed. His old-school, hard-charging pursuit of glamor, performance and excitement are little more than a fading afterglow from the good old days of Motorama excess. The market has moved on, but GM hasn’t.

While GM touts its less-than-revolutionary “interbuildability” scheme, Ford is approaching global product rationalization from another direction: on the backs of suppliers. Automotive News [sub] reports that Ford is requesting that its suppliers turn over component information to other firms if they are unable to supply a given assembly plant. These so-called “transfer agreements” involve handing over specs and technical drawings to other suppliers, which would then assemble the parts designed by the original supplier. Ford’s supply firms are understandably nervous about the initiative, arguing that it would allow Ford to use competition to squeeze suppliers on price. Also, the possible transfers to overseas firms could allow them to remarket the original suppliers’ designs and other intellectual property to other firms.

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OK, that’s a bit of a surprise. Who would have guessed that Lutz’s two first post-unretirement announcements would have heralded a Chevy rebadge and the cancelation of a higher-performance Camaro? Is the age of Maximum over after all? “Any fears that the days of high-performance General Motors cars may be numbered or totally over can be allayed,” Lutz tells Automobile. “There is no pressure at all to get off the high-performance thing.” But clearly there is. According to Automobile’s write-up, the Z28 “was apparently put on hold due to both cost constraints and concerns about the blatant political incorrectness of building a gas-guzzling, super pony car.” So which is it? Bob?

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But if you can’t afford it, would you like to look at some attractive lease offers?

Fresh off a recent discussion at TTAC on the menace of brake dust, the NYT reports that the phenomenon made an impact on the recent JD Power Initia Quality Survey. Apparently consumers are complaining about brake dust in their IQS surveys, and it (among other things) knocked the Jag XF down a spot on the final standings. “A lot of the problems that might seem somewhat trivial from an engineering standpoint -– and brake dust is a good example –- are not necessarily trivial from a consumer’s standpoint,” says Powers’ David Sargent. “The perception is that the brakes are not performing properly, which is false, but in the consumer’s mind it is reality,”he explains. If brake dust isn’t an actual malfunction, why is it included in the IQS survey?

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