Oh GM Fastlane blog, how you wow us with your weak-wristed defenses of GM’s endless parade of missteps. The latest round of apologia (appallogia?) is a shameless response to widespread autoblogosphere criticism of the decision to bring the Aveo-cannibalizing Pontiac G3 stateside. And it’s good to the last drop of brand-destroying denial, utilizing GM’s now-trademark “myth-and-debunking” format. Jim Hopson of Pontiac communications asks himself if the G3 isn’t “just a re-badged Chevy Aveo.” His answer? Toyota brand-engineers Lexus, so it must be fine. Looks like someone needs to catch-up on the differences between platform-sharing and brand-engineering. Speaking of Toyota, will the G3 steal sales from the Vibe? Hopson argues that the comparison is like saying the Corvette and Yugo overlap because they both have four wheels. Nice. How can the G3 be a Pontiac? “Because it’s sporty and fun-to-drive when compared to many of the cars in its segment.” Besides, it has the lowest price and highest efficiency of any other Pontiac, an achievement on par with being the “best microbrew in Utah.” Even the usually-credulous FastLane commenters aren’t having any of it, chiming-in with opinions that follow the basic sentiment “I can not believe how stupid this is.” Neither can we.

Hyundai’s Genesis RWD luxury sedan was initially aimed at new luxury buyers, with a $33k starting price that sought to lure upgrades from the Maximas and Avalons of the world. But Hyundai VP for NA sales David Zuchowski reveals to Automotive News (sub) that this strategy has failed. “We thought the vehicle would be a nice interceptor vehicle for someone looking to move up to the first luxury vehicle. What we found out is somebody looking for the first luxury vehicle needs the (established) brand,” says Zuchowski. “Conversely, we are attracting more people from BMW, Mercedes, who are probably tired of paying premiums for the brands.” This year Hyundai hopes to sell 8k of the new luxury model, ramping up to 20k units over the next several years. “Genesis is not going to be a huge volume, but will have a huge halo effect, it will elevate the entire brand,” says Zuchowski. “For years, we’ve said we don’t have a product problem, we have a perception problem. The gap between what people think of our brand and what our products really are is as large as any in the industry.” This perception-gap complaint somehow comes across a lot more credibly from Hyundai then it does from the usual suspects from Detroit. After all, Hyundai has gone from being a Rodney Dangerfield punchline to a BMW and Mercedes sales thief in a few short years. Hyundai was considering launching a Lexus-style luxury brand with the Genesis, and though it hasn’t ruled the possibility out down the road, such a plan is unlikely given the Genesis’ apparently-strong halo effect.

Non-industry bailout supporters almost always qualify their backing with a number of conditions to be placed on automakers who receive government assistance. As Automotive News [sub] reports “The problem with the plan included in the energy bill: the string attached. Actually, it’s more of a rope. A cable even.” One such rope or cable is the requirement that retooled factories produce vehicles which are 25 percent more efficient than their competitors. Though that may be theoretically possible, AN worries that regulating the loan program could be a nightmare. Unsurprisingly, the Project For A New Generation Of Vehicles (PNGV) is brought up as an example of what happens (or not) when the government gives Detroit money without attaching firm enough conditions. And just like that, there’s another article in Automotive News which reports that automakers are calling on Washington to “change restrictions attached to the money that may impede its benefit for the struggling companies.” An industry lobbyist confides that preliminary conditions were written-up when the energy bill passed last December, but they “were not given much thought at the time.” The big problem? The requirement of 25 percent efficiency improvements, of course. GM CEO Rick Wagoner says that efficiency gains are “typically made in smaller increments.” No kidding, Rick. Detroit got over a billion to develop a new generation of fuel-efficient vehicles starting in 1993 and we still haven’t seen any tangible results, thankyouverymuch. Meanwhile, Nancy Pelosi has not made clear if she is willing to change restrictions on the use of the money or how that would be accomplished. Furthmore, she says that “full funding” of the loan proposal is still up in the air since their are many other programs fighting for access to the federal teat. Stay tuned for future Wagoner press conferences calling on the government to distribute the $25b “in unmarked bills, stuffed in a suitcase and hand delivered to the RenCen.” After all, if Detroit were into the whole “accountability thing” it wouldn’t be asking for a bailout in the first place, would it?

GM has a long history of offering second rate products that are “nearly as good” as the industry standard, and then telling people to buy them because they’re made in America. The CTS may not be the best RWD sedan on the market, but it’s made in America. The Aveo falls flat compared to say, the Fit, but dammit, you love your country, right? Needless to say, the Volt’s “made in  America” badge is going to be a big selling point as GM searches for those willing to justify dropping $40k on the EREV. Well, the WaPo (a nest of America haters if ever there was one) reports that GM’s Rick Wagoner “refuses to promise” that Volt batteries would be built stateside. “As we sit here today I can’t give you a guarantee that it will be made in the U.S.,” Wagoner said. “If we want to get the Volt in the market, as we do by the end of 2010, we’ve got to make some relatively near-term decisions about how we are going to do all that.” But wait, isn’t the proposed bailout (which will certainly benefit Volt production) supposed to address America’s emerging dependence on foreign batteries? Didn’t Chrysler’s Jim Press frame the bailout in those very terms just a short week ago, saying “right now, the major sources of batteries are other countries. So are we trading our dependence on foreign oil, which is a natural resource, for a dependence on other countries to produce something in a factory? We need to stimulate that development here — here in Michigan.”? By putting the hype before the cars, Detroit is either damnably stupid or wickedly cunning. There’s no doubt that there’ll be some egg on GM’s face for increasing our dependence on foreign batteries, but once they actually build the cars (with help from Uncle Sam) they can bring back the battery independence talking point. Then it will be time for bailout round 2.

Say what you want about oil tycoon-cum alt-energy evangelist T. Boone Pickens, the man has some instincts on him. Wal-Mart has been studying ways to reduce its energy usage (for purely altruistic reasons, of course) and Pickens smells blood in the water. Reuters reports that the Texan CNG honcho has convinced Wal-Mart CEO Lee Scott to consider retrofitting its entire diesel truck fleet with CNG power as an energy-saving, cost-cutting measure. Wal-Mart currently operates some 8,500 diesel trucks in its supply-chain network, and a presentation by Pickens to a Wal-Mart associates meeting has convinced Scott to consider the retrofit. According to a weekly Pickens email, Scott was “impressed by the Pickens Plan.” The email continues, “to have America’s largest retailer looking into shifting their trucking fleet to run on natural gas is a major step towards our country’s energy independence.” And a major step towards making Mr Pickens a boatload of cash. Pickens has invested his oil fortune in wind power and CNG, and a Wal-Mart retrofit could mean a huge contract and increased media exposure for CNG as a transportation alternative. Like Pickens though, every decision at Wal-Mart comes down to dollars and cents. We still don’t know how much a CNG fleet conversion would cost or save Wal-Mart. Until we do, there’s no telling whether Pickens’ CNG revolution will get off the ground.

If you fail to pay your toll on Delaware’s I-95, the state could confiscate your car without any due process. This cheery news comes to us from motorist watchdogs extraordinaire, thenewspaper.com. Your license plate number will be recorded if you drive through an automated toll point without paying, and police can run your plates through a database to find out if you have evaded your toll-paying responsibilities. If you show up on one of these databases, your car can literally be confiscated on the roadside, meaning you have to prove your innocence to a civil hearing officer to avoid paying hefty fines and towing fees. And automated toll roads are hardly without their errors; one Texas system overcharged some 50k motorists, Virginia falsely accused 8k of skipping toll payments, and a Harris County audit showed that as many as 67k drivers are wrongly accused of not paying tolls. But that’s not stopping Delaware from stranding you on the side of the road and forcing you into a Kafka-esque bureaucratic labyrinth to get your car back, whether you’re guilty or not. Just another reason to avoid that particular slice of purgatory they call Delaware.

Great news for all you auto-industry bailout fans! The Ukrainian Journal (what, you don’t have a subscription?) reports that Ukraine’s Industry Ministry and the Ukravtoprom Car Producers Association (acronym unknown) have proposed allocating UAH 3.884 billion ($826m) from the national budget to finance the development of the car industry by 2015. And guess what? It’s not a bailout! The appropriation will simply secure nearly $12b in financing to help its industry adapt in a changing global market. Where in the Hell do they get those crazy ideas? But one crucial point differentiates the Ukrainian loans and the bailout currently being sought by Detroit: the Ukrainian car market isn’t up effluence creek. Just-auto [sub] reports Ukrainian Q1 sales are up a tidy 61 percent over last year. The moral of the story? The government helps those who help themselves. Or Detroit desperately needs to master the art of the bribe. Oh wait…

Warning! Video unsafe for narcoleptics or readers enraged by elevator music

Just when Farago begins to question his ongoing coverage of the UK’s obsession with speed cameras, thenewspaper.com proves the significance of the story… Redflex and American Traffic Solutions (ATS) are already raking in tens of million of dollars of loot from dubiously justifiable red-light cameras; corrupting officials, invading privacy and subverting government accountability along the way. But they’re thinking bigger than that. WAY BIGGER (Brother). “We are moving into areas such as homeland security on a national level and on a local level,” boasts Redflex regional director Cherif Elsadek. New “optical character recognition” technology could be integrated with existing red light camera and speed camera systems, allowing full video records to be kept of passing motorists. Add that to ATS’s proposal to integrate Arizona’s speed cameras to a national database, and you can see where this is going. Or just ask Elsadek. “Imagine if you had 1500 or 2000 cameras out there that could look out for the partial plate or full plate number across the 21 states where we do business today. This is the next step for our technology.” Why? Amber Alerts and tracking stolen cars, of course. Nothing to see here.

We reported previously that the McLaren Mercecdes partnership was in trouble because (amongst other things) Mercedes didn’t want an SLR replacement messing with its forthcoming gullwinged SLC (actual name may vary). Nicht wahr, says July’s print edition of Auto Motor und Sport. Mercedes doesn’t want to match the $115m the royal family of Bahrain paid for 30 percent of McLaren, and it’s getting petulant. According to AM und S, “a racing car for the streets doesn’t fit with Daimler’s corporate politics.” If Daimler lets McLaren build sports cars, there’ll be no Mercedes engine or star on the hood. This from the folks who brought us the CLK-GTR, AMG Black Series, Zonda engine, etc. Persistent rumors of a technical hook-up with Aston Martin may mean Mercedes has already made an exclusive deal for its best engines. But spurning McLaren for Aston (if that is what’s happening) doesn’t make much sense. The McLaren-Mercedes racing partnership is a halo exercise for Daimler, and a mid-engined McLaren (already in development) would add to that even without a Mercedes badge. Meanwhile, Aston is never going to start embossing “powered by AMG” into its fine Connolly leather. Besides, DB9s start at $170k, which is bound to be closer to the new SLC’s $150k target price than a mid-engined McLaren would be. Which might explain why renderings of the SLC in AM und S show it going all anti-retro despite the obvious gullwing heritage. So, is Aston going to become the “retro” Mercedes brand? Does McLaren need to find another royal family to buy its freedom from Daimler? Will the SLC still sound like “death on a stick” when it gets to market? As usual, there are more questions than answers.

Ford Chairman Bill Ford is trying desperately to put some daylight between his industry’s bailout request and the ongoing mop-up of what’s left of the U.S. financial system. “People see this as a very separable issue,” Ford told Automotive News [sub] after an epic DC beg-a-thon. As gung-ho as Michigan reps are to see their home state rake in the federal scrilla, there’s indication that even there the “separability” of bailouts may be strained. Rep Candice Miller R-MI, who organized the meeting with Ford and others, said afterwords that some lawmakers still have questions about the loan request– aggravated by the upheaval among major financial institutions over the past days and weeks. These concerns center on analyst predictions that the fed’s decision to allow Lehman Brothers to fail was a line drawn in the sand. Though she calls the new $7.5b cost estimate for the first $25b “too high,” Miller can muster only “cautious optimism” about the future of the bailout push. And while Bill Ford and Mark Fields sing for their supper in DC, bean counters in Dearborn are trying to figure out Ford’s exposure to the bankrupt Lehman Brothers mess. Reuters reports that Lehman Commercial Paper had committed $890m to an $11.5b revolving credit facility under a secured credit agreement reached in December 2006, all of which is presently unfunded. Lehman Brothers Bank FSB also provides $238m of facilities totaling $16.3b that support the retail securitization program of Ford Motor Credit Company. These subsidiaries are not listed in their parent company’s bankruptcy filing. But since Ford mortgaged itself to the hilt in 2006, the unraveling credit-market could still hit Ford where it hurts.

Tesla Motors says it’s secured 90 acres between San Jose and Santa Clara, CA to build its world headquarters. Oh, and production facilities for its (supposedly) upcoming Model S (nee White Star) sedan. The announcement is creating all kinds of excitement among the kind of people who use terms like “green collar jobs” and “cleantech.” “It’s not just another solar company,” says San Jose Mayor Chuck Reed. “It’s an electric car, which has tremendous upside for us, and a whole new area of job potential.” And of course that excitement translates into taxpayer handout. The San Jose Mercury reports that the City of San Jose will sign a 40-year lease with Tesla for the land, providing the first 10 years rent-free. “In years 11 to 20, Tesla will pay $1.5 million a year for the property, and then see rent increases of 2 percent a year in years 21 to 40. Tesla will pay the usual development fees… but the city will look for a way to rebate them over time once tax revenues start flowing in from the company.” Governator Schwarzenegger has already offered to waive sales taxes on the first $100m of equipment purchased for the factory (angering not a few non-automotive manufacturers). And the plant is being built using a $150m federal Department of Energy loan guarantee. Hey, what happened to the whole Tesla in New Mexico deal? Nothing.

“You’ll see some V-8s in trucks and high performance cars in the future, but they’ll be priced to discourage people from buying them,” GM Car Czar Bob Lutz told reporters in a recent interview. “In 5 to 10 years, the 4-cylinder will be the predominant engine.” This maximum prognostication is hardly a shocker when applied to GM’s mass-market offerings. But what about Cadillac? Motor Trend reports that The Standard of the World is working on a new model to replace the laughable, deeply unloved, front wheel-drive, Euro-spec, Saab 9-3-based Cadillac BLS. GM’s next attempt to take on the 3-Series couldn’t possibly do any worse will be based on GM’s new rear wheel-drive “Alpha” platform. According to Automotive News [sub], the new Caddy will be offered with, gasp, a turbocharged four-cylinder engine. Or not. “There is a big debate as to whether it is four only. I think that is a bridge too far,” says Cadillac General Manager Jim Taylor. “There is a piece of the team who is thinking, ‘Well, with this whole fuel economy and gas thing, we ought to go all the way, say, to fours.’ We are resisting that at this stage.” As the BLS and BLS wagon prove beyond a shadow of a doubt, at GM, resistance is futile.

There’s more news re: Chrysler’s mysterious-yet-overhyped 2010 model line, this time from former Treasury Secretary and current Cerberus bigwig John Snow. Despite earlier conflicting reports from John Campi and Jim Press on the number of 2010 model releases, Snow says there will be seven new Chryslers come the mythical year. The International Herald Tribune credulously summarizes Snow’s assertions with the methinks-the-lady-doth-protest-too-much headline: “Cerberus: New Chrysler Products Will Have Appeal.” What form this appeal will assume is left to our imagination. Anyway… “I know there’s a deep commitment here to putting out better products,” says Snow. “In the end, this comes down to producing cars that people want at attractive prices, and having your dealers in concert with the manufacturer. I think we’re going to get that right. I really do.” Really, you do? Because right now the only thing indicating that Chrysler’s woeful quality will improve is the fact that at least one model in the upcoming “product revolution” (product revulsion?) will be a rebadged Nissan Versa. Otherwise, we’re just getting more of the “quality improvement” executive chatter we’ve been hearing since (then Chrysler employee) Bob Lutz famously remarked that “there is no other area in the field of human communications that is as rife with disinformation as the story on Chrysler quality.”

More than 90k purchasers of ’02 – ’05 Saturn Vues and ’03 – ’04 Ions have opted for GM’s VTi continuously-variable transmission. And though it’s tempting to trot-out ye olde caveat emptor, GM is taking responsibility for the widespread failure of its cogless boxes. Since the transmissions cost $4k – $5k to replace, and the preliminary settlement covers repairs, car rentals, towing and trade-in losses, plaintiff lawyers reckon GM could be on the hook for up to $100m. Meanwhile, according to Automotive News, GM’s lawyers demonstrate the carefree optimism of their corporate masters, estimating final settlement costs at $10m – $20m. The settlement will include payments to a yet-to-be-determined class of Vue and Ion owners based on the mileage of the vehicle when the transmission failed, and whether owners purchased the vehicle new or used. The vehicles must have failed within 125k miles or eight years of the purchase date. Although GM lawyer Joe Lines was happy to call the $90 – $100m cost “wildly exaggerated,” he declined to provide a failure rate for the transmission. More tellingly, the settlement means that GM must agree with the “exceptionally prone to premature failure” characterization in the original lawsuit.

Reports of the death of the overpriced/weak-selling Euro-model Saturn Astra are proving premature. Ish. Automotive News (sub) reports that the next-gen Astra will be built at the St Louis Potosi plant in Mexico, in hopes of turning a profit in the dollar zone. (The new Astra is currently in development; The General will release the next gen Astra as a 2011 model based on GM’s global Delta platform.) As currency and shipping costs doom Euro-imports to high price-points and weak profitability, producing U.S.-spec sibs in the U.S. and Mexico (e.g. the Astra and Ford’s Focus, Fiesta, Kuga and C-Max) is becoming the short-term strategy of choice for both Ford and GM. Of course, Ford is taking a more conservative route, producing already-developed models in the NA market. GM is simply adding new-world production of a brand new global platform. Either way, it’s an improvement on the desperate importation strategy currently in effect– even if GM’s choice of Mexican production eliminates yet another opportunity to qualify for retooling loans currently being pork-barreled from congress.