The Federal tax credit for purchasing an electric vehicle is good for up to $7,500 off your next tax bill, under current provisions. But it won’t last forever: each manufacturer can sell 200,000 EVs and plug-ins with the federal rebate, but after that, consumers must pay full price (less any state incentives). And though GM will produce only 10k Volts in 2011, and only 45k units in 2012, its Vice Chairman Tom Stephens is already agitating for the 200k unit limit to be lifted. Optimistic much?
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Bloomberg reports that the Environmental Protection Agency has approved blends of up to 15 percent ethanol in gasoline for cars produced since 2007, handing a victory to pro-ethanol groups like Growth Energy. The EPA had previously capped gas-ethanol blending at 10 percent (E10), on fears that the higher percentage of corn-based ethanol could damage engines. But the approval of E15 hasn’t exactly made those fears go away. According to Credit Suisse analyst Robert Moskow

The approval of E-15 by the EPA won’t have a positive effect on [ethanol giant Archer Daniels Midland] in the near-term. Blenders remain reluctant to implement E-15 because it requires a separate pump and because the EPA has not absolved the blenders of potential legal liability from consumers.

And it’s not just blenders who are up in arms at the decision. Gas refiner Valero Energy, the American Automobile Association and the Detroit automakers (which had previously been pro-ethanol) are all against the increase to E15 in “normal gas.” All of which means E15 isn’t likely to show up at your neighorhood gas pump anytime soon.

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If the recent flap over the Volt’s drivetrain has taught us anything it’s that A) GM’s internal-combustion-assisted plug-in is more complicated than we thought, and B) GM is fine with simplifying its complex reality in order to make it appear as attractive as possible. Which is just fine: they’re the ones trying to sell a $41k car, and as such they’re entitled to do what they can to make it seem worth its many shortcomings. What the automotive media needs to take away from the brou-ha-ha isn’t necessarily that GM’s hesitance to bring forward “the whole truth” is an intrinsically big deal (let’s just say this wasn’t the first time), but rather that knowledgeable writers should focus on explaining the Volt in ways that are both comprehensible and fully accurate. In this spirit, the most important question isn’t “what should we call the Volt?” but “how efficient is the Volt in the real world?”And on this point, there’s plenty of room for some truthful clarification.

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The EU has ambitious CO2 targets: Less than 130g/km by 2012, less than 95g/km by 2020. Carmakers are shaking their heads: No way! Even the most electro-agnostic firms tinker with EVs (even if they are from Japan) to bring their average down. “No problem,” says a new study. The targets are a cinch to reach. What’s more, no heavy and expensive batteries to lug around. use the existing engine! No range anxiety. What is that miracle technology? (Read More…)

The autoblogosphere is agog at the revelation that the Volt’s gas engine occasionally powers its wheels. The GM-created “category” of Extended-Range Electric Vehicles (EREV, or E-REV) as uniquely epitomized by the Volt is suddenly revealed [by Motor Trend via GM] to

[have] more in common with a Prius (and other Toyota, Ford, or Nissan Altima hybrids) than anyone suspected.

So, why did the putative “Father of the Volt” (aka “Maximum” Bob Lutz) tell the car’s primary fan site gm-volt.com that the Volt was born because

My desire was to put an electric car concept out there to show the world that unlike the press reports that painted GM as an unfeeling uncaring squanderer of petroleum resources while wonderful Toyota was reinventing the automobile, I just wanted something on the show stand that would show that hey we’re not just thinking of a Prius hybrid here, we’re trying to get gasoline out of the equation entirely.

?

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As GM finally begins to let journalists drive its Chevy Volt, the two-year-long trickle of bad news about the project is turning into a raging torrent. The latest bit of bashing: InsideLine claims that, in direct contradiction to GM’s hype, the Volt is in fact powered by its gasoline engine under certain circumstances.

At the heart of the Volt is the “Voltec” propulsion system and the heart of Voltec is the “4ET50” electric drive unit that contains a pair of electric motors and a “multi-mode transaxle with continuously variable capacity.” This is how GM describes it:

“Unlike a conventional powertrain, there are no step gears within the unit, and no direct mechanical linkage from the engine, through the drive unit to the wheels.”

The 4ET50 is, however, in fact directly bolted to the 1.4-liter, four-cylinder Ecotec internal combustion engine. When the Volt’s lithium-ion battery pack runs down, clutches in the 4ET50 engage and the Ecotec engine is lashed to the generator to produce the electric power necessary to drive the car. However under certain circumstances — speeds near or above 70 mph — in fact the engine will directly drive the front wheels in conjunction with the electric motors.

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Jeremy Clarkson thinks it’s a pile of wank. Bob Lutz thinks it was a crock of bowel movement. But say what you like about global warming, if you can get credentials which make you “eco-friendly”, that’s worth a lot of marketing money. Which is why Honda is probably feeling pretty chuffed with themselves. (Read More…)

What does the line “It’s More Car Than Electric!” mean? Beats us, but apparently it’s supposed to make you want to buy a Chevrolet Volt. Maybe “The electric car you can just put gas in on those days when you’re not giving a crap about the environment” was too long. Perhaps “It’s actually a series hybrid” didn’t pop with consumers. And maybe “Avoid the scary Range Anxiety® you get with ‘real’ electric cars” was too aggressive. All we know is, GM has registered “It’s More Car Than Electric,” and it’s time to get used to it. Meanwhile, how did we not find the ad parody above sooner?

The flip-flopping over GM’s IPO strategy continues, as The General backs away from its “retail investor” focus and begins courting Sovereign Wealth Funds in earnest. Bloomberg reports that GM’s underwriters have approached

Riyadh, Saudi Arabia- based Kingdom Holding Co., Abu Dhabi-based Mubadala Development Co., Qatar Holdings LLC and Singapore-based Temasek Holdings Pte.

In hopes that they’ll become “cornerstone investors” in the new GM’s IPO. Who knows what will come of the negotiations, but assuming that one or more of the Arab SWFs end up with a large chunk of GM equity, a number of PR problems present themselves. Though (marginally) less emotionally-charged than a possible ownership stake by a Chinese firm, such an outcome would amount to the US-sponsored foreign takeover of an American firm. Politically, the bailout is much easier to justify if GM ends up in American hands… especially since Fiat is likely to gobble up the Chrysler equity it wasn’t handed on a taxpayer-funded platter. But beyond that, GM will have to work twice as hard to convince the American people that it’s not working to serve the interests of its oil-rich Gulf State owners. Renewed scrutiny over its most profitable business, namely gas-guzzling trucks and SUVs, would be a given. Any hesitation (however well-justified) over electrification of the automobile would be interpreted as an oil-cartel plot. And renewed turmoil in the middle east could further inflame anti-Arab or anti-Muslim sympathies, potentially bringing greater pressure on GM. Meanwhile, GM’s energy-independence rhetoric around its E85 ethanol efforts would be extremely awkward.

But will Americans notice or care? At what percentage of ownership would these factors come into play?

The recommendations are simple: Scrap the vertical label, lose the letter grade and emphasize the mpg and cost of owning the vehicle. If the EPA takes these steps, it may be successful in increasing the number of fuel-efficient vehicles on the road and communicating clearly with consumers.

Alan Siegel of brand consultants Siegel+Gale summarizes his firm’s independent research on proposed EPA fuel economy label designs in Automotive News [sub]. Siegel interviewed 456 prospective new car buyers, and found that 66 percent preferred the “horizontal” proposal, while 47 percent found the “vertical” style (which includes the letter grade) “confusing.” No word on what percentage found the letter grades to be “asinine.”

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With sales of its aging city car circling the toilet, Roger Penske’s Smart USA has reached a deal with Nissan to sell a Smart-branded version of a Nissan-developed four-door B-segment car, likely the Versa. Though Penske’s organization apparently pushed for and announced the deal, and the model will be exclusive to the US, the Detroit News calls the move “part of the growing cooperation between the Renault-Nissan Alliance and Daimler AG.” Penske says

Another day, another story on the ever-growing conflict between the UAW’s ownership stake in GM and responsibility to its members. Pre-bankruptcy, GM didn’t have to deal with the fact that the UAW is incapable of building fuel-efficient subcompact cars profitably. As a result, the outgoing Aveo was built and designed in Korea as the Daewoo Kalos, before being fitted with a bowtie and shipped to the US. But now that the General has promised to build the next-gen Aveo in Michigan’s Orion Township plant in exchange for nearly $800m in local tax credits (not to mention the political benefits of “saving or creating” hundreds of union jobs), it’s up to the UAW to square the circle and make the damn thing profitable. Which, according to Automotive News [sub] is just what they’ve done… by bumping 40 percent of the plant’s previous workers to the new “tier two” wages. Which is a nice way of saying “cutting their wages in half.” How is that possible?

The UAW’s 2009 amended contract with GM just before bankruptcy called for “innovative labor agreement provisions” that would allow GM to make a small car profitably in the United States.

Under those “innovative provisions” (which just happened to be conjured up when the government task force was elbow-deep in GM), Orion workers can neither appeal the decision nor go on strike over it. Either the UAW wants to be a union capable of building small cars profitably, or it doesn’t. Screwing less-senior “brothers” so politicians and union bosses can crow over the “green jobs” at Orion is cowardly and despicable.

What will be the fuel of the future for cars? Gasoline? Diesel? Ethanol? Electric? Hydrogen? I might as well ask “What are the numbers for next week’s lottery?” No-one really knows; which is why everyone is hedging their bets. To invest in a particular technology and ignore the rest is basically playing Russian roulette. (There you you. We forgot  CNG.) This next evolution of the car industry is going to be critical. While Ford is looking at other types of alternative propulsion, at the moment it is pretty much playing it safe, sticking to more efficient ICE’s, hybrids and electric cars. Very good bets to make. But now, it seems, Ford is playing it a little riskier. (Read More…)

Hyundai demands its fair share of a market that doesn’t exist. The Koreans are stepping up the development of EVs. Two days ago, Hyundai held a test drive event in the suburbs of Seoul. The invitees could drive a (blue is the new green) Hyundai BlueOn EV. The Nikkei [sub], who was invited, reports: (Read More…)

For all its size and big talk about technical excellence, Daimler doesn’t seem to be doing much of its advanced powertrain R&D itself. News that the firm’s future hybrids will be Toyota-developed is joined by the revelation that Mercedes, not GM, is the mystery OEM which has hired Amp Electric Vehicles to develop an EV SUV prototype. AutoSpies reports that

It seems when Mercedes representatives  visited AMP a while back they were so impressed with the [Amp-electrified Chevy Equinox], that they quickly commissioned a ML-350 test mule for further evaluation.   Our exclusive spy photos reveal that a previously unregistered 2009 Pearl White ML-350 bearing manufacturer plates has arrived at AMP’s facility and is currently in the process of electrification by their engineers.  Upon completion this now all electric ML is slated to undergo testing later in the month.

Which is an interesting turn of events for Daimler’s EV partnership strategy. With a $50m stake in Tesla, one might assume that Daimler would turn to the California firm to electrify its ML. After all, Toyota also has also invested $50m in Tesla as well, and Tesla is electrifying a RAV-4 prototype for Toyota. On the other hand, Daimler has not had much luck with its Tesla-powered Smart EV, so perhaps the Germans are diversifying away from the hype-driven Silicon Valley startup. If so, that’s not a good sign for Tesla or Toyota. Watch this space…