January 25, 2012
December 22, 2011
Perhaps the Cruze won’t be the salvation of Government Motors
The Chevy Cruze was supposed to be a bellwether for the overall health of Government General Motors. If so, things are not looking as rosy for the 2012 model year as they did for the 2011 model:
Ever since emerging from bankruptcy, the Chevrolet Cruze has been something of a symbol of GM’s rebound. Widely hailed by the automotive media as General Motors’ strongest effort to date in a compact segment that has become increasingly important in recent years, the Cruze seemed to show that the “new” GM was capable of selling smaller cars on their merits, rather than as afterthoughts to more profitable truck, SUV and large car offerings. And indeed, through the first half of this year, it seemed that the Cruze was something of a roaring success, regularly outselling its segment competitors. But then, in June, when production shifted from 2011 models to 2012 models, something changed: sales started to slow, and inventories started to rise. As Cruzes began piling up on dealer lots, GM trimmed production moderately, but still, inventories began to grow out of control. Clearly something was going wrong.
Last week, GM shut down production of the Cruze, saying only that it had an unspecified “supplier issue.” But Automotive News [sub] reports that had already GM shut down the Lordstown plant for the entire week of November 28, after inventories shot from 33 days supply to 73 days supply during the months of September and October. As of December 1, inventories had risen higher still, to 88 days, as sales continue to slacken. Lordstown reopened yesterday, but with sales falling and inventories running out of control, another slowdown or stoppage of production seems inevitable.
December 5, 2011
Why GM is very worried about the reported battery fire risk in the Chevy Volt
If you’ve been following the blog for a while, you’ll know I’m not over-optimistic about electric cars in the short-to-medium term (for example, here, here, here, and here) and I’m especially underwhelmed with GM’s most recent offering, the Chevy Volt:
Let’s talk economics first. Electric and hybrid-electric vehicles are more expensive to make and bring in less profit than other cars. They cost more to finance, more to repair, and more to insure. Their sales depend heavily on tax incentives, which means that selling more of them will require more taxpayer dollars. The National Renewable Energy Laboratory (NREL) estimates that plug-in hybrid vehicles cost $3,000 to $7,000 more than regular hybrids, even though the performance differences between the two models are slight, and the really fuel-efficient hybrids cost $12,000 to $18,000 more than the conventional brand. Consider the GM Volt. When it was first announced, the price estimate from General Motors (GM) was $30,000. That soon jumped to $35,000. Today, they sell for nearly $40,000.
Hybrids are also more expensive to insure, which has been known for some time. Back in 2008, online insurance broker Insure.com showed that it cost $1,374 to insure a Honda Civic but $1,427 to insure a Honda Civic Hybrid. Similarly, it cost $1,304 to insure a Toyota Camry but $1,628 to insure a Toyota Camry Hybrid. According to State Farm, hybrids cost more to insure because their parts are more expensive and repairing them requires specialized labor, thus boosting the after-accident payout.
And that, of course, presumes they don’t burst into flames, which brings us to today’s not-so-”ideal” headlines. Several crash tests have suggested that the plug-in hybrid Volt, the flagship vehicle at Government Motors, has a bit of a problem: when hit or badly disturbed in accident tests, the Volt’s Lithium-Ion (Li-ion) battery packs have been seen to spark, or burst into flames afterward.
H/T to Monty.
August 29, 2011
March 21, 2011
January 25, 2011
More examples of the poor being taxed to benefit the rich
Gregg Easterbrook isn’t a fan of flying cars — at least, not flying cars that are fuelled on pure government subsidy:
General Motors has emerged from bankruptcy and taken initial steps to repay its federal bailout money — two good bits of news, although the taxpayer remains on the hook for many billions of dollars extended to GM. Specialty electric-car maker Tesla Motors also had a successful initial public offering and is being celebrated as some kind of testament to the entrepreneurial spirit. For Tesla, this is pure PR.
Tesla is capitalized via a $465 million no-collateral federal loan. This means that if Tesla goes out of business, the taxpayer will take the loss, while if Tesla becomes a hit, its management and private investors will keep all the profit. The company bought a factory in Fremont, Calif. The Department of Labor made $19 million in special payments to workers there, federal taxpayers subsidizing the Tesla labor force. The firm’s electric cars entitle buyers to a $7,500 tax credit, plus sales tax exemption in many states, meaning Tesla marketing receives significant subsidies — average people are taxed so wealthy Tesla buyers receive extra discounts. Compared to its size, Tesla is more heavily subsidized than General Motors at the low point. Basically, the company’s existence is a giant raised middle finger to the taxpayer.
And what’s the product? A $109,000 luxury sports car that accelerates from zero to 60 mph in 3.9 seconds, the speed of the hottest Porsches. Such speed has no relevance to everyday driving; rather, it is useful solely for road-rage behavior such as running red lights and cutting others off. Taxes forcibly removed from the pockets of average people now fund a rich person’s plaything. I dread the moment President Barack Obama has his picture taken next to a Tesla, as if throwing the public’s money away on this toy for the Silicon Valley rich were an accomplishment.
The other absurd vehicle in development is the Terrafugia flying car, which just won exemption from a federal airworthiness safety standard. Surely you will feel secure when a flying car exempted from safety standards buzzes your neighborhood, especially when you learn that another federal waiver means the pilot needs only 20 hours of experience before he or she takes off. Maryland, my state, requires 60 hours behind the wheel before receiving a driver’s license. But fly after 20 hours? Hey, wheels up! Surely few of these accidents-looking-for-a-place-to-happen will sell on the free market. So — scan the horizon for a bailout. The Terrafugia company just got a piece of a $65 million military contract to research a flying Jeep-like thing; don’t hold your breath. If patriotism is the last refuge of scoundrels, defense contracting is the last refuge of bad business plans.
Tesla note: The car is well-named, for although Nikola Tesla was an important inventor and a key figure in the development of commercial-scale alternating current (he had one of the basic ideas for getting electricity to homes), he also was a relentless self-promoter, not shy about exaggeration. The famous photo of him in his Colorado Springs laboratory, reading a book as electricity crackles around him, is a double exposure — that is, faked. Tesla’s plan to allow global wireless communication using Earth’s magnetic field was, let’s just say, a long shot — he worked, of course, before satellite-relayed signals were possible — and his claim to be able to deliver electricity to businesses through the air never made much sense. If Tesla were alive today, he’d drive a Tesla.
Terrafugia was last heard from lowering their expected capacity, while raising their prices back in September.
October 21, 2010
October 17, 2010
September 2, 2010
Rival electric car manufacturers already positioning for dirty ad campaigns
Lewis Page rounds up the GM-versus-Tesla ad campaigns of the near future:
As US motor mammoth GM gears up for the launch of its plug-in hybrid Chevrolet Volt, it has applied to trademark the term “range anxiety” — meaning the fear suffered by battery-car owners regarding their ability to get home again after a given journey. Upstart battery car maker Tesla Motors has issued a panicky and unconvincing statement in response.
[. . .]
GM feels that “range anxiety” is a major reason why its original EV-1 battery car of the 1990s failed.
”We’ve been here before,” says GM marketing honcho Joel Ewanick. “We have first-hand experience with what the issues are.”
In short, the difficulty with an all-electric battery car is that there is little certainty of actually being able to complete any journey even close to the vehicle’s rated range, as battery endurance is highly variable — and manufacturers can’t publicise the worst-case (or even perhaps the likely-case) figures. If they did, nobody would ever buy their products.
[. . .]
Meanwhile, reputable Swiss boffins have lately pointed out that in fact a VW Golf powered by one of the new, super-low-emission injected turbodiesels is responsible for less carbon emissions over its lifespan than one with a li-ion battery running on typical grid power.
So, to wrap up the discussion briefly, nobody will be buying Tesla Roadsters or Government Motors Volts for their economic virtues: they’ll be buying them as expensive status-signalling devices to show off their (real or imaginary) environmental awareness.
August 3, 2010
July 31, 2010
USDOT holding back Toyota report because it’s too favourable to Toyota?
Toyota has been claiming for quite some time that they have found no fault in their cars that could cause unintended acceleration. The US government’s report is reported to support that claim, but officials have been delaying the release of that information:
Senior officials at the U.S. Department of Transportation have at least temporarily blocked the release of findings by auto-safety regulators that could favor Toyota Motor Corp. in some crashes related to unintended acceleration, according to a recently retired agency official.
George Person, who retired July 3 after 27 years at the National Highway Traffic Safety Administration, said in an interview that the decision to not go public with the data for now was made over the objections of some officials at NHTSA.
“The information was compiled. The report was finished and submitted,” Mr. Person said. “When I asked why it hadn’t been published, I was told that the secretary’s office didn’t want to release it,” he added, referring to Transportation Secretary Ray LaHood.
A Transportation Department spokeswoman, Olivia Alair, said NHTSA is still reviewing data from the Toyota vehicles the agency is examining. “Its review is not yet complete. The investigation remains ongoing,” she said.
It could be suspected that the reason the government doesn’t want to release the report is that it pretty much exonerates Toyota after their trial-by-media over the sudden acceleration issue. The US government’s holdings in GM and Chrysler make them effectively competitors with Toyota, and the media has done a fine job of trying to depress Toyota sales (to indirectly benefit GM and Chrysler).
But that would be an unfair thing to suspect, wouldn’t it?
July 30, 2010
Chevy’s re-Volt-ing new song
Iowahawk tries to find the right way to introduce the new Chevy Volt (click through to get the full linkulacious glory):
Consider, if you will, Chevy’s once proud musical history: In the Fifties, Dinah Shore famously saw the USA in her Chevrolet. In the Sixties the Beach Boys saved their pennies and saved their dimes for a 4-speed dual quad positraction 409, while Shutting Down a 413 Superstock Dodge with a fuel injected Stingray; Paul Revere and the Raiders countered with a porcupine Chevelle SS 396. Those vatos from War rocked the Seventies gas crisis in an Impala Low-ri-der, while Sammy Johns was alright with makin’ love in his creepy Chevy Van. In the Eighties, the Dead Milkmen sang the praises of a Bitchin’ Camaro; In the Nineties the Ramones further egged it on with Go Little Camaro Go.
Fine iPod selections all, and in praise of a revered American car brand. Now behold — if you dare — the brave new world of government-sponsored Chevrolet song.
April 15, 2010
February 26, 2010
Is the Corolla the new Pinto?
David Harsanyi examines the different treatment Toyota is getting from the US government (majority owner of the former #1 US automaker):
The Toyota horror is well on its way to transforming the Corolla into the Pinto of the 21st century. Who knows? Perhaps the worst is true about Toyota. Perhaps it is hiding something. Maybe Toyota thought it was infallible. Maybe it is evil. Right now, though you might not know it, it’s all just a bunch of maybes.
There have been to this point 2,600 reported incidents of “sudden unintended acceleration” reported to Toyota — a company that used to sell 9 million cars yearly, most of them in the United States. This yet-to-be defined glitch — maybe a floor mat sticking — has reportedly caused more than 30 deaths.
What we do know is that anyone involved in a Toyota-driven accident now has a scapegoat. And, if they’re smart, a lawyer.
All of a sudden, Toyotas are dangerous. Edmunds.com, which reviewed more than 200,000 complaints filed with the National Highway Traffic Safety Administration over the past decade, found that Toyota ranked fourth- best among the top 20 automakers in the overall number of complaints per vehicle sold.
General Motors came in six spots lower. Then again, GM is special — or, rather, developmentally disabled. Thus, the U.S. government has the majority stake (with funding extracted from taxpayers) in Toyota’s main competitor. It also has the power to drag the CEO of its chief rival to Washington to nearly badger him into cutting off a pinky in one of those ritual atonement ceremonies.
And while Toyota is being subjected to show trials, what would happen if an American car company had to announce a big recall? No need to wonder:
Then there is the administration. Less than a year ago, Ford — a private, non-government good ol’ American corporation — issued the largest single recall in its long history. A total of 4.5 million vehicles were recalled after it was learned that faulty switches were fire hazards.
At the time, the Obama administration’s overmatched Transportation Secretary Ray LaHood gently prodded customers “to pay attention.” When news of Toyota’s problems began to emerge, before we even knew what it was all about, LaHood told Americans to “stop driving” them. (He later claimed to have misspoke.)
In spite of the media’s best efforts to blacken the brand, I’m still very happy with my Toyota Tacoma. If I had to go and buy another vehicle tomorrow, Toyota would still be my first stop, and would most likely be the brand I’d buy (Honda would be a distant second).
