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2019 Chopping Block

26th December 2018

This is the time of year when some automotive publications tell us about all the vehicles that are on the chopping block, that are either done with production or about to be done.

USA Today has just published a list (see this link). In some cases, the list reeks of missed opportunity, where the car in question was a truly good/great car but was in the wrong place at the wrong time or was a victim of gross negligence on the part of its owner/steward.

Their Time was Up
Ford Taurus – Ford lost its way with Taurus when it made it a bigger car in order to use an existing Volvo platform. Classic case of trying to hammer a square peg into that damn round hole. Taurus’s days were numbered for years.

Chevy Impala – similar to the Taurus, but Impala was more just a victim of changing tastes in the market. Customers just aren’t buying cars, especially big cars, anymore.

VW Beetle – the Beetle was a fashion play from the beginning of its resurrection and fashions simply don’t last. I’m surprised it lasted this long, frankly.

Cadillac XTS – see Chevy Impala. Same deal here.

Who Gives a Shit? (or, “They Still Sell That?”)
VW Touareg – this vehicle, from the day it went on sale, violated Marketing 101 by having a name that NOBODY can pronounce. It’s hard to want a product that you can’t say. How do you ask for it? VW has been particularly guilty of this over the years. Full disclosure: I do know how to pronounce it, but it took a lot of practice to get it right.

Hyundai Azera – nobody really wanted a luxury Hyundai, and eventually Hyundai agreed when they introduced their new Genesis brand

Honda CR-Z – I actually liked this car a lot, but I learned a long time ago that my taste is NOT representative of most Americans’. This was a sporty hybrid with an available manual tranny! Yeah, nobody else knew that either.

Nissan Juke – this was the fugliest car since the Pontiac Aztec, and that’s saying a lot. It was quirky just for the sake of being quirky. Never a good idea.

Just a Victim of Circumstance
Ford Focus, Chevy Cruze, Chevy Volt, Ford C-Max, Toyota Prius V – all of these are victims of the trend “You can sell anything in this market, as long as it’s an SUV”. The subtitle of the trend is “If its main reason for being is that it gets good fuel economy, Americans don’t want it!” These are all good/great cars, but with fuel an an inflation-adjusted price of almost zero, Americans have reverted back to “bigger is better, and it better be an SUV”.

Bad Management
Cadillac CT6 & ATS – both of these 2 are truly great/world class cars, and part of their demise is that they are cars (see above). However, there are still plenty of cars out there that are NOT being cancelled, so the fact that Cadillac can’t sell them is more an indictment of Cadillac management than of the cars themselves.

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GM Chairman and CEO Dan Akerson testified before Congress yesterday. He opened with the following statement. Akerson has been criticized in the media for his lack of experience in the auto industry and his public comments of his competitors’ products, specifically Prius and Lincoln. This statement to open the hearing, though, is perfect. Whoever wrote this statement should have prepped Rick Wagoner and the rest of the auto CEOs when they testified a few years ago. Enjoy.

Good morning and thank you Chairman Jordan and Ranking Members Cummings and Kucinich.  I welcome the opportunity to testify today and stand behind a car that all of us at GM are proud of.

Please allow me to start with some Volt history: 

GM unveiled the Volt concept at the January 2007 Detroit Auto Show.  In June of 2008, the “old GM’s” Board of Directors approved the Volt project for production well before the bankruptcy and infusion of government funds.

The battery story goes back much farther to the early 1990s with GM’s extensive work on the EV1.

Drawing on that experience, we engineered the Volt to be a winner on the road and in customers’ hearts.

Today, I’m proud to say the Volt is performing exactly as we engineered it…

            …In its first year, Volt garnered the Triple Crown of industry awards: Motor Trend Car of the Year; Automobile Magazine’s Automobile of the Year; and, North American Car of the Year;

            …Volt is among the safest cars on the road – earning 5 Stars for occupant safety and a Top Safety Pick from the Insurance Institute for Highway Safety;

            …And, 93 percent of Volt owners report the highest customer satisfaction with their car — more than any other vehicle and the highest ever recorded in the industry.

Beyond the accolades, the Volt’s importance to GM and our country’s long term prospects is far reaching.

We engineered Volt to be the only EV that you can drive across town or across the country without fear of being stranded when the battery power is drained.

You can go 35 miles, and in some cases much more, on a single charge… which for 80 percent of American drivers is their total driving range.

After that, a small gas engine extends your range to 375 miles before you have to recharge or re-fill.

But, if the Volt message boards are any indication, there’s some real one-upmanship going on out there – with customers reporting going months and thousands of miles without stopping once at a gas pump.

No other current EV can do this or ‘generate’ that much passion with its drivers.

We engineered Volt to give drivers a choice— to use energy produced in the United States rather than oil from places that may not always put America’s best interests first.

And, we engineered Volt to show the world what great vehicles we make at General Motors.

Unfortunately, there is one thing we did not engineer.  Although we loaded the Volt with state-of-the-art safety features — we did not engineer the Volt to be a political punching bag.

And that, sadly, is what it’s become.

For all of the loose talk about fires, we are here today because tests by regulators resulted in battery fires under lab conditions that no driver would experience in the real world.

In fact, Volt customers have driven over 25 million miles without a single, similar incident.

In one test, the fire occurred seven days after a simulated crash.  In another, it took three weeks after the test.  Not three minutes.  Not three hours.  Not three days.  Three weeks.

Based on those test results, did we think there was an imminent safety risk?  No.

Or, as one of our customers put it:  if they couldn’t cut him out of the vehicle in two or three weeks, he had a bigger problem to worry about.

However, given those test results, GM had a choice on how we would react.  It was an easy call.

We put our customers first.  We moved fast and with great transparency to engineer a solution.

We contacted every Volt owner and offered them a loaner car until the issue was settled.  And if that wasn’t enough, we offered to buy the car back.

We assembled a team of engineers who worked non-stop to develop a modest enhancement to the battery system to address the issue.

We’ll begin adding the enhancement on the line and in customers’ cars in a few weeks.

And in doing so, we took a 5-star rated vehicle and made it even safer.

Nonetheless, these recent events have cast an undeserved, damaging light on a promising new American technology that we are exporting around the world, right from Detroit.

As the Wall Street Journal wrote in its Volt review:  We should suspend our rancor and savor a little American pride. A bunch of Midwestern engineers in bad haircuts and cheap wristwatches just out-engineered every other car company on the planet.

The Volt is safe.  It’s a marvelous machine. It represents so much of what is right about General Motors and, frankly, about American ingenuity and manufacturing. 

I look forward to taking your questions.

Thank you

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2011 Jeep Grand Cherokee

2011 Jeep Grand Cherokee

Jeep released images yesterday of the all-new 2011 Jeep Grand Cherokee, which went into production this week atChrysler’s Jefferson North Assembly Plant in Detroit. This is the 4th generation of the Grand Cherokee, originally introduced in 1992. It is completely reengineered and redesigned for 2011 – with a new sculpted body, athletic profile, panoramic dual-pane sun roof and an interior with premium soft-touch materials. The 2011 Jeep Grand Cherokee features Chrysler’s all-new 3.6-liter Pentastar V-6 engine that boasts an 11 percent improvement in fuel economy and delivers up to 23 mpg and more than 500 miles on one tank of gas. Capability highlights include a choice of three 4×4 systems, new Jeep Quadra-Lift™ Air Suspension and Selec-Terrain™ systems and towing capability of 7,400 lbs. On-road dynamics are improved courtesy of new independent front and rear suspension systems and a new body structure that dramatically increases torsional stiffness.

Jeep Grand Cherokee Laredo 4×2 models start at a sticker price of $30,995 – $495 lower than the outgoing model. Grand Cherokee Laredo 4×4 models start at $32,995 – $465 lower than the outgoing model. The Overland model is the top of the line, with a price of $42,995 in 4×4 guise. The Limited model slots in between. The 2011 Grand Cherokee arrives in Jeep showrooms next month.

It is hard to overstate the importance of this product launch to Chrysler. Before Fiat’s present management, Chrysler was run by Daimler, which cost-cut the products into irrelevance, and then Cerberus, which cut the cupboard bare of new product investment. There is very little new product coming in the short-term, so it is very important that the new launches it does have are home runs. Chrysler plans to make improvements to just about every product in the next year, but no major launches outside of the Grand Cherokee and the Chrysler 300/Dodge Charger due later this year until Fiat-based new products start coming next year and the year after. The Grand Cherokee looks like a winner, but SUV sales are down overall, which will limit the sales potential. Ford and GM, though, have abandoned the true, off-road (mid-size) SUV market, leaving the market to Jeep, Nissan (Xterra & Pathfinder) and Toyota (4Runner).

2011 Jeep Grand Cherokee Overland

2011 Jeep Grand Cherokee Overland

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Ford Fusion Hybrid

7th February 2010

Ford Fusion Hybrid in Atlantis Green

Ford Fusion Hybrid in Atlantis Green

The Ford Fusion has been around since the 2006 model year, and has always been considered a very good, nice looking car that is fun to drive. For the 2010 model year, introduced last year, the styling was updated to be more aggressive, and also given upgraded engines and a new interior. As mid-cycle freshenings go, this was fairly extensive and well-received. So well, in fact, that it was named the 2010 Motor Trend Car of the Year®.

The Fusion also added a hybrid model, which received the latest generation of Ford’s hybrid system, previously available on the Escape and Mariner SUVs. The new version is smaller, lighter and costs less than its predecessor. The main (maybe only) reason people buy a hybrid is to save fuel. There are different reasons to save fuel (lessen reliance on foreign oil/national security, to save $, curb global warming, other environmental concerns), but everybody is looking to save fuel. So how does the Fusion Hybrid stack up? As you can see in the table, the EPA rates the hybrid at 39 MPG combined, compared to 25 in the regular 4-cylinder Fusion. As the EPA calculates it, that will save you about $575/year (assumes 15,000 miles and $2.66/gallon). Not bad, but at that rate, it would take you 6¼ years to get your money back. This is based on a $3600 MSRP premium for the hybrid system, after adjusting for major equipment differences. As noted above, there are other reasons than simply dollars and cents that go into purchasing a hybrid, but if you are looking at it in only those terms, the investment doesn’t really work well.

When I picked up the Atlantis Green (a beautiful very dark green) Hybrid with 8915 miles on it, the first thing you notice is that it has what Ford calls the “Silent Start” system. As you can figure out on your own, this means that there is no “cranking” of the starter or “turning over” of the engine like in conventional cars. Instead, you twist the key (key? that’s so 20th century, Ford), and you take it on faith that the car has actually started. The only way I really knew it was ready to go is I put it in gear and it went.

The next thing you notice is the video game-like graphics populating the various infotainment screens –

SmartGauge with EcoGuide

SmartGauge with EcoGuide

one on either side of the central speedo (Dual LCD SmartGauge™ Cluster with EcoGuide) and the larger navigation screen on the center stack. The screen on the left side of the speedo contains various combinations of information that indicate how the engine and battery are working together. You can choose from 4 levels of information called Inform, Enlighten, Engage or Empower.

Inform is the most basic, and it only shows you the battery charge level. Next up is Enlighten, which adds a tach and an indication of the battery power being used. Engage adds the engine power being used to go with the battery, so you can try to maximize the battery usage vs. the engine. Empower offers the highest level of information. It shows you how much power you are using for the accessories (radio, climate control, lights, etc.) and also shows you how close you are to the gas engine on/off threshold vs. total power demand. This can help you to feather the accelerator to stay in the battery-powered area as long as possible if you are looking to maximize fuel economy. when you are in electric-only mode, you get rewarded with a green section at the bottom of the screen that says “EV”. At all levels except Inform, arrows on the battery charge graph show if the battery is being used or charged at any given time. It also shows green circular arrows when the regenerative brakes are active.

At this point, I should point out that the regenerative brakes are a bit of a problem. All 17,600 units built before 10/17/2009 have a software glitch that can result in a perceived loss of braking power as it shifts unnecessarily from regenerative brakes to regular. There is no actual loss of power, but the driver will have to apply extra force to obtain the necessary braking. No injuries have been reported. I experienced no brake issues of any kind.

The right side of the display shows instant fuel economy and either “efficiency leaves” or the recent efficiency as a bar graph. The leaves grow and produce more leaves as you drive efficiently, and loses them when you don’t. It’s fun to try to grow as many leaves as possible. I think that’s the point. It also shows you a trip summary every time you turn off the car, including trip fuel economy, distance traveled, gallons used and long-term fuel economy.

So how does it drive? For the most part, just like a “regular” Fusion. Which is to say, very well. The combined 191 horsepower is plenty for normal, even spirited, driving. It isn’t going win you any pinks at Thunder Road, though. But if that’s what you want, you can opt for one of the 2 different V6s (3.0L or 3.5L) that are available on the petrol Fusion. It also handles very well in the curves and the brakes, especially with the regenerative system (which uses the braking energy usually lost as heat to recharge the battery) are very good.

The Fusion Hybrid can drive up to 47 MPH in electric-only mode. I was “only” able to achieve 42 MPH. For comparison, a Toyota Prius can go 25 MPH on the battery alone. When I turned off the fan and the radio, the Fusion was so quiet in EV mode that when it came to a stop, you could clearly hear the various fluids sloshing around in their respective receptacles. It’s a bit like drinking a big glass of water and then doing jumping jacks. I never heard that in a car before.

Issues? A few. The EV mode doesn’t seem to be available when you first start driving. This is unfortunate, because emissions and fuel economy are both much worse when the engine is cold. If the battery could be utilized (assuming it is charged enough) to power the car and heat up the engine at start, both fuel economy and emissions would improve. By not having battery power available until the engine is heated completely, you also don’t get much help from the battery on a very short trip. Because my test was done in Michigan in February, the cold weather is at least partially responsible for this. Batteries simply don’t function as well in the cold.

Usually, as the computer shifts between gas, battery power and both, you do not notice it at all. As I found out testing the car, this is because you are normally applying the throttle at the time (when it shifts from battery to gas), or maybe not at all (when it shifts from gas back to battery). However, if you are attempting to maximize your economy by using the accelerator very lightly, the car shutters noticeably when shifting from EV to gas. It isn’t a violent shutter, but it is noticeable.

One other nit. As shown in the table, the hybrid gives up almost 30% of its trunk space, due to the hybrid systems. I guess this is to be expected; the battery has to go someplace, but it comes at a price.

In a variety of driving – stop & go city, highway, very gentle to full throttle, I came away very impressed with the Ford Fusion Hybrid. Overall, this is a solid performer. It gets better fuel economy than the Toyota Camry Hybrid (41/36/39 vs. 33/34/34), and the Fusion overall is more reliable than the Camry, according to Consumer Reports.

Rating: 8½ out of 10. Excellent, but not perfect.

Fusion Hybrid

Fusion I4 SEL

Base Price (MSRP)




2.5L I4 w/HEV

2.5L I4








CVT Automatic

6-speed automatic

EPA Fuel Economy (city/hwy/combined)



Curb Weight (lbs.)



Fuel Tank Capacity (gallons)



Range (city/hwy/combined)



Trunk Capacity (cubic feet)



Major Equipment Differences:

Reverse Sensing System



110-volt Power Point



Ambient Lighting



Dual LCD SmartGauge™ Cluster with EcoGuide



6CD Changer instead of Single CD



Fold down Split Rear Seat



Eco-Friendly Cloth Seating



Leather-trimmed and Heated Seats



Dual Exhaust



Regenerative Braking System



Driver’s Knee Airbag



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It has been nearly 2 years since we first saw the Chevy Volt at the Detroit auto show, and we have been subjected to a nearly non-stop media and marketing assault since.  Chevrolet and GM have taken every opportunity to tell us how wonderful the Volt is (or rather, “will be”).  They have used it in corporate advertising, it has appeared on The Late Show with David Letterman and at every auto show on the planet in the last 2 years.  What you might not know is that it is also AT LEAST another year or more until anybody will have the opportunity to buy one, and then in only small numbers and in select areas of the country at the beginning.

In the latest example of this sensory overload, Chevy commissioned a Volt jingle.  No kidding – you read that right.  Chevy released this jingle last week at the LA Auto Show.  I’ll admit, it is a bit catchy.  It has a pleasant melody and attempts to educate and get you excited about the Volt.  But seriously, do we really need a Volt jingle more than a year before we might have a chance to buy this thing?  GM should be more focused on delivering the Volt on time and on budget and less on selling it before they have a single one to sell!  That said, click on the image below to hear the jingle.  Note that the images in the video are not provided by GM.  The video portion is the work of Lyle Dennis, who created, launched, maintains and writes the website  He’s a bit of a Volt-nut, but his work has gotten him recognition from the media and from GM.  GM has even given him the opportunity to drive a Volt prototype recently.

That’s what I think – how about you?  Please leave your comments below.

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E85 – What You Need to Know

3rd December 2009

First, please understand that this isn’t a scientific journal, nor an economics one. This is an automotive website, so this discussion will only talk about E85 as it pertains to cars and driving. I will not discuss whether E85 is artificially cheaper because of government subsidies (it is) or whether or not the production of E85 from corn takes food away from people (I don’t know). I only want to briefly educate you about the pros and cons of buying a car that can use E85 and what you can expect when you do use it.

E85 is the abbreviation for fuel that is 85% ethanol and 15% gasoline. No vehicles for sale in the US can run on ethanol alone. You need at least that 15% gasoline. Vehicles that can run on E85 can run on any ethanol/gasoline combination with at least 15% gasoline. That’s why they’re called flex fuel vehicles (FFVs). You can fill up on E85 one day, then regular gasoline the next time without any problem. Flex fuel vehicles are more expensive to build than “regular” vehicles because of the special components that can withstand the corrosive nature of ethanol. There are only 2211 stations that sell E85 in the US, which means that most vehicles capable of running on E85 never do. So why do the automakers build them? They get CAFE credits for offering the FFVs, even if they never use E85 (can you say “loophole”?) and you get to feel good aboutmaybe helping lessen our dependence on foreign oil.

So what’s the difference when you use E85 instead of gas? The first thing you’ll notice is that E85 tends to cost less, though not always and the amount varies. says that the national average price is $2.22/gallon, while regular gasoline is $2.57/gallon. Great, right? Not so fast, my friend. Because of the differences between the fuels and the engine design compromises made to allow the engine to use either fuel (or any combination of them), using E85 results in lower fuel economy versus using gasoline in the same vehicle. The Slandy Report analyzed the differences in the EPA rating of every FFV sold in the US and found that the rating is approximately 27% lower for E85 use than for gasoline. We also found that the average range of a tank of gas is also more than 100 miles less on E85 than for gasoline, so you would need to refuel more often. When you combine the lower prices of E85 with the lower fuel economy, E85 still comes out more expensive by 16% compared with gasoline. In other words, gas is 16% cheaper than E85 if you look at cost per mile.

So why buy an FFV? Some things are not easily quantified in dollars, like the foreign oil point made above. While E85 is more expensive to use than gas, you will use 79% less gasoline per mile driven than if you use gasoline. Corn is also a renewable source, so theoretically, we would never run out. Buying an FFV vehicle is a matter of choice, of course, and so it the decision to use E85 instead of gasoline. You now have some real-world facts that will help guide your decision.

That’s what I think – how about you? Please leave your comments below.

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Today, Ford announced details of the 2011 Mustang V6, which will receive substantial upgrades in the powertrain.  Gone is the SOHC 4.0L Cologne V6, which has powered the V6 Mustang since the present generation (S197) was introduced in 2005 (and which traces its lineage back to 1968).  In its place will be the newest version of the Cyclone engine family, a 3.7L V6 with Twin Independent Variable Camshaft Timing (Ti-VCT), which can adjust the valvetrain “in microseconds”. With Ti-VCT operating its four valves per cylinder, the new Mustang V6 powerplant sends significantly more horsepower and torque (305 hp and 280 ft.-lb.) to the rear wheels than its predecessor (210 and 240, respectively) – despite its smaller displacement.

While the extra horsepower and refined engine operation are great, the 2011 Mustang 3.7-liter V6 also achieves projected class-leading fuel economy:

  • 19 mpg city/30 highway with six-speed automatic transmission, up from 16 mpg city/24 highway on the 2010 model with automatic – a 25 percent improvement
  • 18 mpg city/29 highway with six-speed manual transmission, up from 18 mpg city/26 highway on the 2010 model with manual

Refinements throughout Mustang’s body, powertrain and chassis design also contribute to the improved fuel economy numbers, including the new Electric Power Assist Steering (EPAS) system which eliminates the drag of an engine-operated hydraulic power steering pump (it also reduces noise), six-speed transmissions that allow lower cruising revs without sacrificing off-the-line performance and aerodynamic improvements such as a new front fascia, tire spats on the rear wheels, modified underbody shields, a taller air dam and an added rear decklid seal.

Enthusiasts who want a premium performance-oriented Mustang V6 can opt for the new Performance Package, which will be available August 2010. Designed for driving enthusiasts, the Mustang V6 Performance Package comprises:

  • A 3.31 rear axle ratio for quicker off-the-line acceleration
  • Firmer Mustang GT suspension
  • 19-inch wheels (1st time available on a V6 Mustang)
  • Summer performance tires
  • A strut tower brace for increased chassis rigidity
  • Unique electronic stability control calibration with sport mode for performance driving

For 2011, Mustang also includes new technology and convenience features, including a standard driver’s message center in the instrument cluster, integrated blind-spot mirrors in the side-view mirror housings, Ford’s MyKey™ system, designed to encourage safer teen driving and safety belt use, also is newly available on Mustang.

So where does this leave the V8 Mustang?  While today’s announcements did not discuss the V8 Mustang, Ford will obviously have to do something. The new V6, as noted above makes 305 hp and 280 ft.-lb. of torque, while the present 4.6L V8 makes 315 and 325, respectively. The torque difference is enough to notice, but the horsepower is way too close. While Ford has not yet announced the details, word has leaked that the 2011 V8 Mustang will be powered by a new 5.0L V8 that will make at least 400 hp and 400 ft.-lb. – stay tuned for more details.

So who’s on top in the latest chapter of the Pony Wars? It’s a complex comparison, but the Mustang, which already beats the Camaro and Challenger in several areas besides power, will now be very competitive in power as well. As you can see, all 3 vehicles are about the same size, with the Mustang smallest in most dimensions and the Challenger the largest in every dimension. If the 2011 Mustang GT matches the Camaro SS in power, it will indeed be a very compelling package – especially if they hold the line in pricing.  Sadly for Dodge, it will now be underpowered in a bigger, heavier package.

2011 Mustang

2010 Camaro

2010 Challenger

V6 HP/Torque




V6 Fuel Economy




V8 HP Torque

400+/400+ (est.)


372/400 (5.7L)

425/400 (6.1L)

V8 Fuel Economy



16/25 (5.7L)

14/22 (6.1L)


$21,845 (2010)



















That’s what I think – how about you?  Please leave your comments below.

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Showing that they care much more about ratings and sensationalism that about actual facts, Fox “News” came out strongly criticizing the recent Department of Energy (DOE) loans to Fisker and Tesla.  Fisker was awarded $528 million and Tesla $465 million.  It is difficult to enumerate all of the false and misleading statements in the following video clips, but here is a sampling of the junk that they try to pass off as news:

  • Many times, the loans are derided as a handout to “foreign” companies “creating jobs in Finland” and “going to build a car in Finland for $89,000”.  In fact, both companies are American, based in California.  The confusion on the part of Fox and its guests is from the fact that presently, Tesla only produces one model, which is made in Great Britain. Fisker doesn’t produce anything yet, but its first model, the Karma, will be assembled in Finland. However, the loans are for the development and eventual manufacture of lower-priced models from both companies that will be made in the US.
  • Stating and strongly implying that the only reason that Fisker received the loan is because Al Gore is involved and was pulling the strings behind the scenes.  In fact, Al Gore is a partner in Kleiner Perkins Caufield & Byers, a major investor in Fisker.  However, another partner is Colin Powell, who once considered running for president as a Republican.  Fox offers no evidence of tampering by Gore or KPCB.  It just throws out the implication.
  • They have David Williams of “Citizens Against Government Waste” to discuss.  He rails against the loans as wasteful.  Fine.  Disagree with the program if you want, but Fox also asks him about the cars and whether they are worthy of the loans.  This guy doesn’t know any more that the hosts when he says the money will not help the average American.  See first point.
  • At the end of the first segment, almost as an after thought, the host mentions that Fisker says the money will be used to fund another model, but it isn’t even designed yet.  Great job on doing your homework.  Even for the best car companies, it takes years and millions (sometimes billions) of dollars to design and develop a vehicle to sell.  Fisker (and Tesla) are going to use these low interest loans to fund that very development, so of course the new vehicles aren’t developed yet.
  • The 2nd segment includes a writer from the Wall Street Journal, who is no better.  Several times, he refers to Fisker as a “Finland company” and Tesla as a “British company”.  Then he says 3-4 times, “I don’t agree with this type of government largess, but if you’re going to do this, at least give the money to an American company.”  I almost expect this type of bluster from Fox, but not the Wall Street Journal.  They are supposed to at least be knowledgeable about business.  If they’re not, what value are they to anybody?  He even tries to equate this to the US contracting out the moon program of the 1960s to the Russians.  Unbelievable.
  • They conveniently leave out the fact that 1 truly foreign company has already received over $1 billion in DOE loans – Nissan.  Ford and Nissan received funds in the first installment of the DOE program earlier this year.  As a US taxpayer, I would much rather my tax $ go to Fisker and Tesla than Nissan.  Nissan’s profits and intellectual property are in Japan, where the good jobs truly are located.

By the way, Fisker has issued a press release disputing the reports about the loan and about the company. Tesla has also attempted to calm the storm and get the facts out.  You can read the Fisker release here, and the Tesla release here.

That’s what I think – how about you?  Please leave your comments below.

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Mazda2 Coming to NA

21st September 2009

Mazda announced that they will bring the subcompact 2 to the US and Canada in late 2010.  “As consumers’ tastes and attitudes toward small vehicles have changed, we now believe strongly there is a place in our lineup for a car below our current least-expensive car, the Mazda 3,” Jim O’Sullivan, Mazda North American Operations president, said in a statement.  Mazda didn’t say where the 2 will be produced, but as it shares a platform with the upcoming Ford Fiesta, will they make it in Cuautitlán, where the Fiesta will be produced beginning next year?  It sure seems to make sense.  Mazda gets local production for the North American market, saving logistics costs of shipping from Japan.  Ford gets another vehicle for its plant, which helps ensure that the plant will be at a high utilization rate, which reduces the risk of discounting.  Customers get better choices and better prices, and North American workers get more jobs.  Everybody wins, right?  Maybe not.  Ford recently divested most of its stake in Mazda, which might make them hesitant to help Mazda sell cars.  They should ignore that kind of thinking and worry about making money for themselves, which producing the 2 at Cuautitlán will do.  However, if I know how Ford thinks, and I do, they probably have overly optimistic volume projections for the Fiesta and think they can’t spare the capacity for the Mazda2.  They should reconsider this (if I’m right) based on:

  • their spotty record of forecasting their own sales
  • the fact that the Mazda2 will likely be sold in VERY small numbers, even compared to the Fiesta, and
  • the lack of any coherent energy policy in the US means that gas prices will likely continue to fluctuate wildly, leading to further volatility in the sales of fuel-efficient vehicles -so they should hedge with this car and the Fiat 500 for the Cuautitlán plant.
That’s what I think – how about you?
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Toyota has told its dealers that it will use the Prius name on other hybrids in its lineup.  This was disclosed in a meeting of Toyota executives and its 60 largest US dealers last week.  They said Prius will not become a sub-brand like Scion, but the name will be attached to other hybrids in an undisclosed manner.  There are at least a couple of ways they could accomplish this, with varying degrees of intelligence.  It has been suggested that they might follow the lead of Oldsmobile in the 1980s, which seemed intent on badging every vehicle as a “Cutlass” – Cutlass, Cutlass Supreme, Cutlass Calais, etc.  In this method, we would have Prius, Prius Highlander (or “Prius SUV”), Prius Camry (or “Prius Sedan”), etc.  This would defeat the whole point of using the Prius name, which Toyota dealer Earl Stewart said, ““The Highlander hybrid and Camry hybrid do OK, but calling it ‘Synergy Drive’ never resonated with consumers,” Stewart says. “But they can make hay on the Prius name. It’s a magic name. If somebody says ‘I drive a Prius,’ everybody knows what he means.”  If they use the Prius name as a separate group of vehicles in the showroom, like in the above examples, the name Prius will lose its cache and its meaning, killing the very advantage they hoped to leverage.

If, on the other hand, they use the name “Prius” as a branding of its hybrid system (which is presently called “Hybrid Synergy Drive”), that might work.  In this method, we would have a Camry Prius, Highlander Prius, etc.  It might sound like the same thing, after all, all I did was to switch the words around.  However, no matter how they brand these vehicles, customers will know that it’s a Highlander or a Camry.  Calling it anything else will only insult their intelligence.  Keeping the model name first and using “Prius” as a descriptive term which brands the hybrid system makes sense.

Which way will Toyota go?  No way to tell – they haven’t even confirmed this new direction publicly yet.  At times, it seems that Toyota is bent on becoming the 21st century’s GM – too big for its own good and making bad decisions.  You would think that Toyota’s management is too smart for that, but we also thought GM’s was too smart 40 years ago.

That’s what I think – how about you?

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