The downturn in the economy isn't just affecting the mainstream automakers. The Wall Street Journal reports luxury car manufacturers are also suffering. (Yes, suffering.) In March, luxury car sales sank 14 percent from last year. "Super luxury" cars such Bentley, Rolls and Maybach were hit the hardest– the uber expensive segment fell 39 percent. Of those models, Bentley was the biggest loser, with a 42 percent loss. Entry level luxury models (BMW 3-series, Mercedes C-Class) were down by 13 percent. Middle (though not middling) luxury cars (BMW 5-Series, Jaguar S-type, Infiniti M35) were down 20 percent. And upper luxury vehicles (Mercedes E-Class, BMW 6- and 7-Series) dropped 24 percent. It's probably not a very good sign for the rest of us when even the wealthy start economizing on their whips.

Reuters reports that Delphi is considering asking federal bankruptcy judge Robert Drain to force equity investor Appaloosa Management to carry through with their $2.55b investment in the bankrupt auto parts manufacturer. Last Friday, Appaloosa announced they were backing out, citing GM's expanded role in the Delphi's exit strategy as the deal breaker. [NB: Appaloosa doesn't want GM to be able to prevent a strip-and-flip resolution to Delphi's bankruptcy.] In a filing with federal securities regulators, Delphi stated their board has formed a special litigation committee and engaged counsel to explore their legal options. Appaloosa had no comment, but they've said they'll consider investing in Delphi under "different terms." If Delphi doesn't get the funding from Appaloosa and/or other investors, they'll have to go back to GM for more than the $2.8b the automaker's already promised. If that fails, Judge Drain could lose his near-infinite patience, with Chapter 7 liquidation to follow.

The Insurance Institute for Highway Safey (IIHS) released the results of their tests on seven midsize sedans today: Malibu, Avenger, G35, Optima, Galant, Aura and Altima. All but the Optima received good ratings in front and side crash tests. The Optima was rated acceptable in front and side tests while it received a good rating in rear crash testing. Four of the cars– Malibu, Aura, G35 and Altima– were considered "marginal" in rear crash tests; the Galant was rated poor and Avenger was rated adequate. The Detroit News points out IIHS test standards are more stringent than those NHTSA uses for their "star" ratings, but NHTSA says they'll have stricter standards in effect for the 2010 model year. Mitsubishi and GM were quick to say they design their vehicles to meet federal standards, displaying their usual "if 65's a pass, 66 is overkill" mentality.

Remember Ford's promise to improve SUV fuel economy by 25 percent by 2005? Or the one about building a quarter-million hybrids by 2010? Well, the Detroit Free Press reports that The Blue Oval Boyz are at it again. FoMoCo's pledged to reduce greenhouse gas emissions from its U.S. and European vehicles (no mention of Chinese or Australian models) by 30 percent by 2020. So what makes them think they can keep this promise? Better modeling, says Ford's VP for sustainability, environment and safety engineering. "We started this 'modeling' three years ago" Sue Cishcke reveals. "And that's given us confidence to be able to say what our thinking and blueprint and plan is, and how it's aligning with the regulations." Of course, meeting the new Corporate Average Fuel Economy (CAFE) standards will increase fuel efficiency by 40 percent– and reduce greenhouse emissions drastically. And when do these new regs go into effect? Why it's 2020! What a coincidence.

We weren't the only ones giving Toyota grief about their $20m contribution to the Audubon Society. The Green Company That Also Sells Gas-Guzzlin' Trucks has gone on the defensive after readers of their Open Road blog castigated the Japanese automaker for the largesse. It seems the National Audubon Society is one of the plaintiffs in a suit against the National Park Service for alleged failure to regulate beach driving at the Cape Hatteras National Seashore in North Carolina. Readers felt Toyota's donation "is being used against people who use their 4-wheel drive vehicles" and "to help fund the closure of the beaches of the Outer Banks of NC." ToMoCo says not so. After all, "we build and sell four-wheel-drive vehicles that have developed an enviable reputation in the four-wheeling community and many of us here are enthusiastic four-wheelers." To that end, their donation "will be used only to fund conservation projects, train environmental leaders and offer volunteer opportunities, not for lobbying or legal efforts." Yes but… a contribution of that size will free Audubon to redirect organizational funds that would have been used for those purposes, increasing their legal and lobbying firepower.  

Hertz isn't the only rental car company trying to save the planet one Buick LaCrosse at a time. The AP (via Google News) reports that Enterprise is lathering-up for a bit of greenwashing. The nation's largest rental company is opening four "green branches" in that bastion of environmental awareness: Atlanta, Georgia. In response to "consumer demand," about 60 percent of the vehicles offered in the designated green stores will be hybrids or other fuel-efficient vehicles. Experts say that rental customers looking to buy a hybrid are driving current demand (so to speak). No surprise there; rental companies charge a $5 to $15 a day hybrid premium. Enterprise, Hertz and Avis have about 10k hybrids in their fleets. With over 1.8m vehicles in rental fleets across the nation, Cobalts, Corollas and Elantras are destined to remain the rental companies' bread and butter vehicles– even as they put their green creds on the line.

March comes in like a lion and leaves like a lamb. As far as auto sales were concerned, the month came in like a dead fish and left like… a pile of dead fish. While the raw sales numbers rose from February's levels, total sales were down by 12 percent compared to March of last year. Year to date (YTD), total sales were off by eight percent. Reflecting higher gas prices, light truck sales dropped by 17.8 percent; car sales "only" sank 5.9 percent. Here's how our individual bellwether models fared…

Those of you in Chicago, Dallas, or Boston who are anxiously awaiting your Chevy Volt can just keep waiting. In an email to the Detroit Free Press yesterday, the Volt's pater familias Bob Lutz revealed that if when it (finally) goes on sale, it'll be distributed first in California, then in Washington D.C., Florida, New York and "elsewhere on the East Coast." Apparantly the rest of the country gets whatever's left over. However, he warned "that's only current thinking, and the plans could change." Given the rate at which they've changed their minds on everything about the Volt from the styling to the release date, you can count on the final distribution plan looking nothing like he described.

GM isn't the only automaker suffering from corporate ADD; Chrysler's marketing department seems similarly afflicted. Yesterday, they announced yet another marketing schtick. Hot on the heels of "New Day," the Consumer Advisory Board and "Chrysler Listens" comes "If you can dream it, we can build it." That seems like a pretty bold promise coming from a company that can't even get a subcompact car to market. Anyway, the press release quotes Spinmaster Supreme Deborah Meyer: "Chrysler is moving on all fronts to engage our customers and harness their insights, inspirations and dreams as we move quickly to develop and refine new technologies and products." That's great! I'll take a hybrid passenger car with room for five that gets 45mpg in the city, goes 0-60 in under seven seconds and handles like an M3. There… I've dreamed it. When can you build it?

Bloomberg reports a recent survey that shows Ford's initial quality is at the same level as Toyota's and Honda's. The survey, which ranked problems per 1k vehicles in the first three months of ownership, showed Ford's vehicles scored 1,284 against Toyota's and Honda's "statistically equivalent" 1,250. GM and Chrysler didn't do so well, scoring 1,367 and 1,744 respectively. Of course, Ford will crow about their "achievement" in their "Drive One" ads. What they won't tell you, though, is that Alan Mulally signed the figurative check to RDA Group for performing the survey. That's right folks — Ford bought the survey in which they placed so highly. I vented the editorial spleen when they did the same thing last year, so all I'll say this time is that it didn't seem to help their sales then so I hope they get their money's worth this time.

Audi may be right on target with their plans to import diesels . A study by J.D Power (via the Detroit News ) shows diesels and gas-electric hybrids will have 17 percent of the U.S. market by 2015. Surprisingly, Power thinks diesels will outsell hybrids because of the higher cost of admission to the hybrid club; they predict by 2015 hybrids will increase to seven percent of the market (from the current 2.2 percent) while diesel vehicles will make up ten percent. Sales of four-cylinder gas engines are also expected to rise sharply as the automakers scramble to meet the new 35mpg CAFE standard. They don't think hydrogen fuel cells and pure electric cars will have much impact as they won't be available in any significant numbers during the years covered by the study. But what about E85? The proportion of vehicles available that can run on corn squeezin's will nearly double but few of them will be using it because it still won't be available in most places. That won't matter to the manufacturers, though, if the new CAFE standards have the ethanol loophole the current one does.

Corn prices hit an all-time high price of $6.025 per bushel yesterday, then settled to a not-much-better $6. Ethanol producers are feeling the hurt, as the corn they use is now costs more than they're currently getting for the ethanol they make from it. Earlier this week, Michael Jackson (no, not that one– the president of Syntec Biofuel) explained: "For years, corn was cheap and fermentation processes for ethanol production came to completely dominate the biofuel industry in North America. Now, with corn prices well over $5 a bushel, corn ethanol economics have gone out the window." That isn't slowing the ethanol producers though. The American Farm Bureau Federation estimates that about 20 percent of last year's corn crop went to ethanol production and predicts that'll go up to 30 percent for the next crop year. With 147 plants in production and another 61 planned, the situation will only get worse. In the meantime, corn growers are reaping record profits while consumers can expect higher prices for anything that's corn-based. Sounds vaguely familiar, doesn't it?

Bloomberg reports parts maker Delphi's exit from bankruptcy has hit a snag. Appaloosa Management, one of the six investors working to get the former GM parts division out of Chapter 11, backed out of the deal. In the termination notice, Appaloosa claimed Delphi didn't meet the conditions of the $2.55b deal. Oh, and they asked for a $82.5m "breakup fee." It's not an entirely unexpected development; Appaloose had not been happy with GM's expanded role in the Delphi's exit strategy. They felt the automaker would have too much power as a result. When GM offered even more money to help cover Delphi's $3.8b pension fund shortfall, it was the proverbial straw/camel thing. Appaloosa indicated that they're still open to investing, but "in a capacity different than currently envisioned by the agreement." 

UPDATE – General Motors released a statement on this matter: "GM is disappointed in the decision by Appaloosa and the plan investors to withdraw their support for Delphi. There has been a tremendous amount of effort and progress made to establish the foundation that would enable Delphi to emerge from Chapter 11. GM will continue to work with the involved parties to facilitate Delphi’s efforts to emerge from bankruptcy." Meanwhile, the lawyers…

BMW expects the U.S. to be their largest market for the X6 whatever-it-is when it goes on sale at the end of May for $52.5k. What this says about the tastes of the American car-buying public isn't quite clear but they're predicting half of the 40k annual production will find a home here. The next-largest markets will be the UK and Germany, which combined will only total about 10% of production. So who do they think will buy this… thing? Customers with astigmatism "who want a high-ride vehicle like an SUV but also sporty, coupe-style looks," according to Automotive News [sub]. The last time anyone attempted combining the two, we got the AMC Eagle SX-4 . Of course, there are those who would buy a Tata Nano if they stuck a BMW badge on it, so they probably won't have any problem unloading every one of these sedan/coupe/hatchback/crossover/SUV mish-mashes they build.