Archive for the ‘Autos – Travel’ Category

Obama better buy his Volt now … right now!

November 28, 2018

On a campaign stop a couple of years ago, after a photo op sitting in a Volt, President Obama told a crowd of United Auto Workers:

“It was nice. I bet it drives real good,” he said. “And five years from now, when I’m not president anymore, I’ll buy one and drive it myself.

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Well, since GM has announced that it is killing the Volt, Obama might want to place his order pronto … and, demand a clearance price discount.

All of this should come as no surprise to anybody.

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Forget cow tipping … there’s a new sport.

December 2, 2016

Since the election is over, the T-Day conversation at our house shifted to “cow tipping”.

So, let’s dip into the HomaFiles archive for the definitive explanation … with a twist.

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A news story caught my eye yesterday.

But, first some context …

Have you ever heard of “cow tipping?

It’s a ritual where drunk farm boys  sneak up on cows and tip them over.

Technical note: I have no idea why they have to be drunk, but it’s always stated that way.

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Last year , Modern Farmer magazine published a scientific study on cow tipping.

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Basically, Modern Farmer debunked the rural legend:

 Cow tipping, at least as popularly imagined, does not exist.

Drunk young men do not, on any regular basis, sneak into cow pastures and put a hard shoulder into a cow taking a standing snooze, thus tipping the poor animal over.

While in the history of the world there have surely been a few unlucky cows shoved to their side by gang of boozed-up morons, we feel confident in saying this happens at a rate roughly equivalent to the Chicago Cubs winning the World Series.

The evidence against cow tipping is immense, and backed up by both farmers and the laws of physics

Ignore the cheap shot at my favorite Cubbies … focus on the “boozed up morons” and the “laws of physics”.

The Modern Farmer study was provocative  enough that it was picked up by Slate.com with the following headline:

 

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Uh-oh, this is where things get really interesting …

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Forget cow tipping … there’s a new sport.

April 8, 2014

A news story caught my eye yesterday.

But, first some context …

Have you ever heard of “cow tipping?

It’s a ritual where drunk farm boys  sneak up on cows and tip them over.

Technical note: I have no idea why they have to be drunk, but it’s always stated that way.

image

Last year , Modern Farmer magazine published a scientific study on cow tipping.

image

Basically, Modern Farmer debunked the rural legend:

 Cow tipping, at least as popularly imagined, does not exist.

Drunk young men do not, on any regular basis, sneak into cow pastures and put a hard shoulder into a cow taking a standing snooze, thus tipping the poor animal over.

While in the history of the world there have surely been a few unlucky cows shoved to their side by gang of boozed-up morons, we feel confident in saying this happens at a rate roughly equivalent to the Chicago Cubs winning the World Series.

The evidence against cow tipping is immense, and backed up by both farmers and the laws of physics

Ignore the cheap shot at my favorite Cubbies … focus on the “boozed up morons” and the “laws of physics”.

The Modern Farmer study was provocative  enough that it was picked up by Slate.com with the following headline:

 

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Uh-oh, this is where things get really interesting …

(more…)

Maybe, the best commercial ever … n’est-ce pas?

March 11, 2014

Have you seen the new Cadillac commercial?

At several levels, I think it’s a great ad.

At a broad level, it’s creating an incredible level of buzz.

As AdAge puts it:

Fans on the political right see . . . an unapologetic ode to American values.

Critics on the political left see it as Ugly American chest thumping at its worst.

What’s got folks so stirred up?

Here’s the ad’s punch line:

“We’re crazy, driven, hard-working believers. . . . . You work hard. You create your own luck.

And you’ve gotta believe anything is possible.

As for all the stuff?

That’s the upside of only taking two weeks off in August, n’est ce pas?”

Crass ugly American materialism … or the American Dream?

Watch the commercial and draw your own conclusion.

One of my favorite reactions was from a “Manhattan brand consultant” who quipped:

The spot is well-done but philosophically odious.

The surprising thing strategically is that they would choose to play to their base instead of trying to expand it.

Say, what?

First, what’s odious about reaping some benefits from hard work ?

Sure, it’s ironic that the commercial is coming from Government Motors … but should the company be touting the progressive mantra “liberation from work” ?

I don’t think so.

Re: “playing to the base” …

I thought Cadillac’s base was NFL-NBA players and urban-based chemical distributors.

Who else rolls in Sclades ?

Note: I probably shouldn’t generalize from personal experience, but an NFL player lives a mile or two from our house.  During the season, there are always 12 or more black Escalades parked in his circular drive.  Place looks like a Caddy showroom.

They are trying to “expand the base”.

The Caddy ad caught my attention ….

…. just like C.C. Catch did in the 80s with her hit “In the Backside of Your Cadillac”

I may go car shopping this evening …

Flambé: Tesla hits phantom steel object and does a Dreamliner …

October 4, 2013

Guess what: Big batteries – when subjected to trauma – catch fire … whether in the air  (787) or on the ground (Tesla).

Earlier this week, a Youtube was posted showing a Tesla on fire.

Audio: “Dude, that’s a brand new car … wow”

click to view

Here are some details …

(more…)

Nums: Gov’t Motors slips in consumer satisfaction …

September 3, 2013

Yesterday, we posted some recent ASCI Customer Satisfaction survey results.

Headline was that overall customer satisfaction numbers have been steadily increasing.

Minor surprise was that autos sorted relatively high on the list.

 

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Source

But, there’s more to the story.

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Nums: Customers are feeling more satisfied …

August 29, 2013

It has been a couple of years since I glanced at ASCI Customer Satisfaction numbers.

And, I was a bit surprised by the numbers …

During the 1990s, there was a pronounced drop in customer satisfaction … aggregated across all categories of products.

But since 1997, there has been a steady improvement … reaching new historic highs.

 

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Source

 

Here are the details by product category …

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Ditch my ride … Americans driving less

July 29, 2013

According to CNBC

Driving in the U.S. reached a peak in 2004 and has been declining steadily ever since.

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Apparently, high gas prices have registered in the American psyche and spurred some fundamental changes …

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Motivation: A compelling reason to shed some pounds …

January 24, 2013

A study reported by EurekAlert! – a science society — concludes that obese drivers are much more likely to die in car crashes than normal weight drivers.

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Here’s the skinny on the study …

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Nums: Which luxury car brand is #1 in the U.S.?

December 21, 2012

According to Business Week, Mercedes has bounced back and regained the lead from BMW.

Lexus has fallen to third.

Cadillac has halted its slide and is hanging on to the #4 slot … but, Lincoln is going, going, …


Source: Business Week

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Sweetheart deal: Board member gets a premium priced buyback

December 20, 2012

In the private sector, this would be be grounds for a perp-walk.

But, not in government world, I guess.

The headline: GM to Buy Back Stock From Treasury

The story:

General Motors (aka. Government Motors) announced that it will purchase 200 million shares of stock held by the U.S. Treasury Department.

The auto maker will pay $5.5 billion for the shares.

The repurchase price of $27.50 a share represents a 7.9% premium over the closing price on Dec. 18.

After the repurchase, the U.S. Treasury will continue to own approximately 300 million shares of GM common stock, or approximately 19% of the outstanding shares on a fully-diluted basis.

GM expects to take a charge of approximately $400 million in the fourth quarter, which will be treated as a special item.

OK, let work through the pieces …

Even at the inflated price, since the Feds bought i at the $33 IPO   taxpayers will incur a trading loss of $5.50 per share … totaling to $1.1 billion.

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GM’s largesse in premium pricing the deal “saved” taxpayers about $400 million.

Keep in mind, this is hardly an arm’s length transaction.

And, we the people still own 300 million shares … representing a paper loss of another $2 billion.

Gentlemen start your engines …

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Follow on Twitter @KenHoma             >> Latest Posts

Hybrids are so yesterday …

December 9, 2012

ExtremeTech.com says that “traditional” hybrids are dying.

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Here’s Extreme Tech’s logic …

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A pink car that prevents women’s wrinkles … really?

November 14, 2012

Punch line: Honda releases a new car targeted at Japanese women, boasting features that will prevent wrinkles.

* * * * *
Excerpted from psfk.com’s, “Honda’s Car For Women Prevents Wrinkles”

Honda released a new model designed especially for women, the Honda Fit ‘She’s.’

Available only in Japan, the make targets the nearly 50% of Japanese women who have decided to stay out of the work force.

The car sports a pink exterior, pink stitching on the interior, and shiny pink chrome covers on the dashboard. They have even put a heart in place of the apostrophe in “She’s” to bring the point home.

Honda-Fit-Shes-2-610x418

The first “designed for women” automobile since 1955′s Dodge  La Femme goes beyond a superficial color treatment.

With a new type of windshield said to block up to 99% of UV rays, women can drive to the grocery store confident that they are not increasing their chances of wrinkles.

With the model’s “Plasmacluster” AC system, women can pick up their children knowing that the specially-treated air is improving their skin quality as they drive.

Whether the claims are substantiated or not, the model will be sure to provoke conversation around the age-old question, “What do women want?” and open more than one can of worms for the Japanese automaker.

Edit by BJP

What did Mitt say about the auto bailout? … “Check the record”

October 23, 2012

In the last debate , Obama challenged folks to “check the record” re: what Romney said about the auto bailouts.

Ok, we did … and it’s very interesting.

Obama was talking about a 2008 op-ed in the NY Times.

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Yeah, the op-ed was titled “Let Detroit Go Bankrupt”.

That’s inflammatory since most folks think that “bankrupt” and “go out of business” are synonymous.

They’re not.

Bankruptcy is a process for stabilizing a failing company … not necessarily – and not usually – a liquidation (think practically every airline).

Romney was arguing that GM should go through the process and follow the in-place bankruptcy laws … rather than having the Feds dictate the terms for winners & losers.

What Romney opposed was dishing bailout checks … and letting taxpayers pick up the tab.

Specifically, he said “Detroit needs a turnaround, not a check. “

His plan had a couple of basic components:

  1. New labor agreements to neutralize the $2,000 per car cost disadvantage
  2. New management from best of breed non-automotive industries (think Alan Mulally – the turnaround guy that Ford got from Boeing)
  3. A new labor-management relationship … “Getting more and more pay for less and less work is a dead-end street.”
  4. A strong dealer network … “When sales are down, you don’t want to lose the only people who can get them to grow. “
  5. $20 billion in gov’t funded research … “done at universities, at research labs and even through public-private collaboration.”
  6. “The federal government should also rectify the imbedded tax penalties that favor foreign carmakers. “
  7. “The federal government should provide guarantees for post-bankruptcy financing and assure car buyers that their warranties are not at risk.”

In short, “a managed bankruptcy … not a bailout check.”

No mention of letting the industry die.

Obama better hope that nobody in Ohio or Michigan takes his advice and checks the record.

* * * * *

While we’re at it … yes, there were winners – mostly members of the UAW.

And there were losers like:

  • GM bondholders (think retirees and widows) whose secured loans were subordinated to the UAW
  • The 20,000 non-union Delphi salaried retirees, who lost their pensions and benefits programs as they were headed into retirement
  • The profitable GM dealerships that were closed because they spoke out against the Fed’s bailout process (I personally know the principles of one such dealership in Baltimore).
  • US taxpayers who are still holding the bag for the $25 billion bailout Source

Again, Obama better hope that nobody in Ohio or Michigan takes his advice and checks the record.

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I was struck by a Volt of lightning …

September 13, 2012

What are the odds?

I actually (not virtually, actually) passed a Chevy Volt on the road

Note that “I passed” not “I was passed by”

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Again I ask, what are the odds?

Well, according to the Detroit News, there have been about 16,000 Volts sold from its birth to date.

Note: about 2,000 have been bought by the gov’t and GE – pandering to the Feds

According to the Dept. of Transportation, There are about 250 million registered vehicles in the U.S.

So, the statistical likelihood of the next car I pass being a Volt is about .0064% … or, less than 1 in 15,000, given the geographic distribution of Volts. 

According to the NOAA, the odds of being struck by lighting in your lifetime are 1 in 10,000.

Hmmm.

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Side Note

Reuters reports that nearly two years after the introduction of Volt, GM is still losing as much as $49,000 on each one it builds

It currently costs GM “at least” $75,000 to build the Volt,

According to experts, GM’s basic problem is that “the Volt is over-engineered and over-priced,”

Weak sales are forcing GM to idle the Detroit-Hamtramck assembly plant that makes the Chevrolet Volt for four weeks starting September 17

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Will GM go bankrupt again?

August 24, 2012

That’s the question posed in a recent Forbes article that’s worth reading.

Here are some of the underlying facts … read the article for the editorial stuff …

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Stock Market

The federal government owns 500,000,000 shares of GM, or about 26% of the company.

The stock is trading at about $20/share, so the government is holding about $10 billion worth of stock

The government’s GM stock is worth about 39% less than it was when the company went public at $33 /share

Since GM’s IPO almost two years ago, the broader S&P 500 has gone up about 30%.

During that period, Ford shares have gone down about 15%, Toyota up about 15%, Honda up about 5%, Nissan up about 35%, Hyundai up about 60% and Volkswagen up about 85%.
Source

It would take about $53.00/share for the gov’t to break even on the bailout.

 

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Car Market

As a company, General Motors peaked in 1965, when it commanded 50.7% of the U.S. market, and made a stunning-for-the-time $2.1 billion dollars in after-tax profits.

In the 1960s, GM averaged a 48.3% share of the U.S. car and truck market.

For the first 7 months of 2012, their market share was 18.0%, down from 20.0% for the same period in 2011.

GM is flailing in the D-car segment (Malibu, Camry) which accountd for about 20% of the U.S. car market.

Recent (and forthcoming) versions of the Malibu score dead last in Car & Driver reviews.

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Uh-oh

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Holy Solyndra: Battery maker A123 Systems goes Chinese … ouch!

August 10, 2012

A123 Systems was supposed to be one the U.S. companies to propel the green energy revolution … by designing, making, and supplying batteries to hybrids and electric cars (think Volts).

A123 received more than $200 million from venture investors before raising $378 million in a 2009 initial public offering.

Also in 2009, it was awarded a $249 million green-technology grant under the Obama administration’s $2.4 billion Electric Drive Battery and Component Manufacturing Initiative.

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But, things haven’t been going so good for electric cars and A123.

A123 said second-quarter revenue fell 53 percent to $17 million … the company’s  second-quarter loss of was $82.9 million … and cash dwindled to the point that the company can only fund its operations for the next four to five months.

So, according Auto News, China’s largest automotive parts supplier is now poised to take control of A123.

China’s Wanxiang Group Corp. plans to invest up to $450 million in A123 Systems, taking an 80 percent stake in A123.

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Ken’s Take: So much for energy independence and government venture capitalism.

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GM market share slips 3 points … now, that’s a turnaround to be proud of.

August 2, 2012

The President continues to tout his prowess as the venture capitalist who engineered GM’s bailout.

Hmmm.

Last week, GM canned its VP – Marketing after less than 1 year on the job.

This week, the company released July sales results.

Bottom line: the pie grew, but GM’s sales fell 6% versus last July … and its market share dropped by a whopping 3 points … down to 17.4%

Any wonder why the share price is about half of the IPO price?

 

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Source

 

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Remember GMAC? … GM going sub-prime (again)

July 31, 2012

According to IBD

Near the end of 2010, GM acquired a new captive lending arm, subprime specialist AmeriCredit.

Renamed GM Financial, it has played a significant role in GM’s growth.

Ken’s Note: Approximately 20% of GM revenues go thru GM Financial

The automaker is relying increasingly on subprime loans.

Potential borrowers of car loans are rated on FICO scores that range from 300 to 850.

Anything under 660 is generally deemed subprime.

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So, lots of fleet sales to the Federal & Blue state governments … lots of self-financed sub-prime loans to move the metal

Cue the repo man … for the deadbeats’ cars … and the stock-sliding company.

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Note: GM shares are now about half of the IPO price.

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GM offers no-haggle prices … and a money-back guarantee.

July 11, 2012

According to Bloomberg

Losing ground to Toyota and needing to clear out end-of-model-year vehicles, GM will offer no-haggle pricing on 2012 Chevrolet cars and trucks plus a money-back guarantee on all new Chevys .

The new promotions, which GM calls its Chevy Confidence program, address two things car shoppers dread: haggling and commitment.

Americans aren’t great at haggling and we are expected to do so on the two biggest purchases we face: real estate and autos.”

“This Chevrolet Confidence program alleviates the issue of haggling and eliminates ‘buyer’s remorse.’”

The no-haggle program pledges to offer 2012 vehicles at the “best possible prices” in addition to current incentives.

The no-haggle sales price, called Total Confidence Pricing … harkens back to previous sales programs offered by GM.

The company’s Saturn included no-haggle buying before the brand ended as part of GM’s bankruptcy reorganization in 2009.

Such programs are “marginally effective,” according to Dennis Virag, president of Automotive Consulting Group. “There will be some buyers, but I don’t think it’s going to attract a large number of new customers for Chevy.”

* * * * *
GM is trying to boost Chevy as the brand faces greater pressure from Toyota.

U.S. sales of Chevrolet, GM’s largest brand, rose 6.3 percent to 961,662 cars and light trucks in the first half, a slower pace than the industrywide increase of 15 percent; Toyota’s namesake brand gained 29 percent to 937,964.

Ken’s Note: Toyota faced what President Obama would call “headwinds” the past couple of years with a tsunami knocking out production for a few months, and Obama’s Secretary of Transportation calling Toyotas unsafe to drive … a hysterical charge that was never proven.

GM CEO Dan Akerson  is pushing the company to boost operating margins and strengthen Cadillac and Chevrolet as global brands.

Anybody see a trend?

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What do GM and Facebook have in common?

June 13, 2012

Easy question, right?

Two high profile IPOs that have lost about of their value since their IPOs.

C’est la vie …

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GM

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Facebook
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Remember the last big IPO? … You know, the one before Facebook

May 21, 2012

Well, Facebook went out at $38 and closed at $38.

The pundits are whining that the IPO was a failure because there wasn’t a big first day pop.

My take: one of the rare times that the IB’s priced a deal at fair market value.

Oh my, “flippers” didn’t get a chance to earn millions by just showing up for work.

Sounds ok to me.

* * * * *
What I didn’t like about the Facebook IPO is that it got most analysts talking about the Government Motors IPO.

Given the chatter, I got curious and checked out the stock price

Oops, down almost 40% from the IPO price …. during a period when the overall market was up over 10%.

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Geez, since Bin Laden is dead and GM is alive, why the stock dip?

The company claimed record profits of $7.6 billion in 2011, the “highest profits in the 100 year history of that company” according to President Obama.

And, the company paid no Federal income taxes on taxes those record earnings.

Why?

Because New GM came out of bankruptcy “owning” all of the tax loss carry forwards from old GM.

That’s not supposed to be allowed when a company goes through bankruptcy — a deterrent to companies trying to simply buy losses to offset some of their taxable earnings.

How did it happen?

According to several sources:

The Obama administration quietly snuck in a special tax break for GM, which allows the company to write off approximately $45 billion in post-bankruptcy losses against post-bankruptcy profits.

It’s good for twenty years.

The $45 million tax write-off is in addition to the more than $50 billion given to General Motors in the bailout,

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About that GM success story ….

May 2, 2012

Team Obama is touting the rousing success of GM. 

You know, Bin Laden is dead; the UAW is alive.

Oops, Imeant GM is alive.

Hmmm.  Let’s see …

The original GM stockholders — you know, your grandma and the pension funds — got completely wiped out.

The secured creditors got about 65% of their principal wiped out.

And privileged folks got the opportunity to buy stock in the new GM.

Those share have declined by 30% from the $33 IPO price ,,, a 50 point spread vs, the S&P 500 which increased  20% over the same period.

That’s a loss of about $16 Billion in market cap in about 18 months.

Now, that’s what I call a roaring success … many more successes and we really will be bankrupt.

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Hybrid owners: “Been there, done that”

April 26, 2012

TakeAway: Recent study shows hybrid vehicles lack repeat purchasers.

* * * * *
Excerpt from AdAge: “Usually No Encore for Hybrid Buyers”

Only about one out of three hybrid vehicle owners chooses to buy another hybrid, according to a study by research firm Polk.

The good news for automakers is that a high percentage of the return buyers remain loyal to the brand, even if they don’t buy another hybrid.

In the case of hybrids, rising fuel prices, to more than $4 a gallon in some places, has so far had “little impact” on hybrid buying decisions, the report said.

“The lineup of alternate-drive vehicles aren’t appealing enough to consumers to give the segment the momentum it once anticipated.”

Edited by ARK

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Ride, Sally, ride …. Mustang’s coming back.

April 19, 2012

TakeAway: Ford’s Mustang brand is being refreshed to target Gen-Y consumers who have to taste the the freedom of driving.

* * * * *
Excerpt from WSJ: “Old Mustang Is Put Out to Pasture”

The Mustang today strongly hews to the look of the 1964 original. But Ford is working on radical makeover of its signature youth-market car, people familiar with Ford’s plans said.

The next generation would retain the shark-nosed grille and round headlights, but would look more like the new Ford Fusion.

The change is part of a bid to make the Mustang appeal to Generation Y, the roughly 80 million people who were born between 1980 and 1999. This demographic group is entering its peak car-buying years.

For Ford, Gen Y may prove a difficult target.

For many in this group, cars and driving just aren’t that cool in an era of iPads and Facebook.

A 2011 study by the University of Michigan found that just two-thirds of all 18-year-olds had driver’s licenses in 2008, down from 80% in 1983.

Edited by ARK

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Obama better buy his Volt now …

March 13, 2012

On a campaign stop a couple of weeks ago, after a photo op sitting in a Volt, President Obama told a crowd of United Auto Workers:

“It was nice. I bet it drives real good,” he said. “And five years from now, when I’m not president anymore, I’ll buy one and drive it myself.”

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Well, he might want to place his order now …

WSJ reports that despite advertising galore, Chevy has sold under 10,000 of the green machines so far — less than 1,000 per month — and GM has decided to idle production of the battery-powered car for five weeks.

The plant had just resumed production on Feb. 6 after a prolonged holiday shutdown.

Former GM Vice Chairman Bob Lutz the main force behind the Volt, said recently that GM’s lofty targets for the Volt are its main problem.

“The Volt is a bases-loaded home run,” Mr. Lutz said. “It will overcome.”

Another GM spokesperson says:

“This technology is here to stay, we have all kinds of people who want to copy it and go after it. We are not re-evaluating anything … The only question here is what the rate of sales will be.”

In other words, great dog food …. it’s just that the dogs aren’t eating it.

Thanks to SMH for feeding the lead

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Toyota targets new hybrid launches at young buyers …

January 20, 2012

Question: How many total hybrid cars or trucks sold in the US are Toyota Priuses?

Answer: Nearly 50%.

Toyota hopes to grow its share of the hybrid market with new product launches, such as the Prius C –  “c” for city, to attract young buyers.

* * * * *
Excerpted from brandchannel.com, “NAIAS Action: Toyota Woos Younger Buyers with Hybrids

Toyota and Honda …  have been gearing up new products they’re hoping will begin attracting Americans back to their brands this year …

Toyota  showed off its new Prius c — the “c” in the name is for city — a small entry in its growing “family” of Prius hybrids, and bowed its NS4 concept plug-in hybrid that should see the market around 2015.

… Toyota is  reaffirming its commitment to the long-term future of a type of propulsion that it pioneered with the Prius hybrid.

Toyota also plans to introduce a “plug-in” Prius, a la the Chevrolet Volt, sometime this year, as well as a Scion iQ EV and a second generation of its Toyota RAV4 EV, an SUV, in small volumes.

“Young buyers on a budget have seen hybrids as out of reach… The next three years … will be a critical period for gauging consumer interest in other advanced technologies.

Cost and convenience will remain the key challenges during this period. [Also], refueling infrastructure remains a distinct challenge”  …

Edit by KJM

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Looks like a hybrid, runs like a hybrid … it’s eAssist.

January 17, 2012

Punch line: Buick is ducking some common perceptions by calling its new LaCrosse hybrid a “LaCrosse with eAssist”.

Excerpted from BrandChannel

American consumers remain decidedly lukewarm to hybrid vehicles.

Buick is hoping to get around this obstacle by positioning its latest hybrid, a version of the LaCrosse sedan, as a non-hybrid. Instead, GM is touting the “light electrification” system it uses for the car and has come up with a unique brand name for it: “eAssist.”

“When you say ‘hybrid,’ many times that comes with baggage.”

“So for us, the focus was to put an emphasis on the car itself and what this car delivers and how technology enhances the ownership experience.

We’re selling a LaCrosse that happens to have this great [eAssist] technology.”

For example, Buick and its dealers are emphasizing: the quiet ride… and the car’s  “start-stop” capability which halts operation of the engine at stoplights, saving fuel, and then starts it up again when the driver punches the accelerator.

The LaCrosse with eAssist retains a feature that has proven popular with most hybrid purchasers: a screen on the instrument panel that helps them track …  fuel economy.”

The eAssist gauge “is a way for people to show they’ve got something unique, and they can show their friends and families.”

That’ll fool a lot of folks, won’t it?

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Good riddance: Electric car subsidies expire … at least, some of them.

January 3, 2012

According to the Wash Post

Two of the most wasteful subsidies ever to clutter the Internal Revenue Code went out with the old year when Congress declined to renew either

  • The 45-cent-per-gallon tax credit for corn-based ethanol.
  • A credit that gave electric-car owners up to $1,000 to defray the cost of installing a 220-volt charging device in their homes.  

But, he $7,500 tax credit that the government offers purchasers of electric vehicles did not expire at year’s end.

The Obama administration says that the credit helps build a market for EVs, which helps create jobs.

Sales of electric vehicles were disappointing in 2011, with the Volt coming in below the 10,000 units forecast.

Evidence is mounting that President Obama was overly optimistic to pledge that there would be 1 million EVs on the road by 2015.

More prosaic fuel-economy innovations such as conventional hybrids, clean-diesel cars and advanced gasoline engines all show much more promise than electrics.

>> Latest Posts

Frito-Lay says: “Gentlemen, start your (electric) engines.”

December 13, 2011

Punch line:  Frito-Lay is building the largest fleet of electric cars in North America

According to Today’s Trucking

PepsoCo’s Frito-Lay North America has turned the ignition on ten new electric trucks in Orlando.

The electric delivery trucks are set to be part of the largest planned fleet of commercial all-electric trucks in North America.

Frito-Lay plans to deploy 176 electric trucks this year, making them the largest commercial fleet of all-electric trucks in North America.

The trucks are by Smith Electric Vehicles, and designed to operate at peak effectiveness in urban environments.

The trucks generate zero tailpipe emissions and each truck emits 75 percent less greenhouse gases than a conventional diesel truck.

The trucks operate for up to 100 miles on a single charge.

>> Latest Posts

GM: The Volt isn’t about how many you sell … say, what?

December 2, 2011

According to the WSJ:

  • The company sold 1,139 Volts in November, bringing sales to 6,142 this year.
  • GM will miss a target to sell 10,000 Volts in 2011.
  • GM has 134 day’s supply of the Volt, while the Nissan has a 21 day supply of the Leaf, the only other electric car on sale in the U.S. mass market.

GM’s reaction: “The Volt isn’t just about how many cars we sell …. This car is revolutionary.”

Speaking of revolutionary …

GM offered to buy back Volts from any owner who fears the car is a fire risk amid a U.S. safety investigation of its lithium-ion battery.

Not exactly a textbook example of Crossing the Chasm …

>> Latest Posts

GM goes all-electric in 2013

November 16, 2011

More precisely, GM will launch it’s first all electric car – the Spark —  in the U.S. in 2013.

Technical note: the Volt is a combo electric with an ICE (internal combustion engine) in reserve.

According to USA Today

GM will sell its first production all-electric car in the U.S. in 2013.

It will be battery EV version of the coming Spark mini-car.

The Spark is a tiny city car that is smaller than Chevy’s new subcompact Sonic.

The EV version will be sold in “limited quantities” in select U.S. markets.

Ken’s Take: “Limited quantities” ?  I’m betting the under.

>> Latest Posts

Chevy Volt’s battery catches fire … oops.

November 15, 2011

The Detroit Free Press reports that a Chevrolet Volt caught fire several weeks after a crash test.

The electric vehicle had been subjected to a low speed (20 mile-per-hour), side-impact test for its crash safety rating.

Apparently, the crash punctured the Volt’s lithium-ion battery, and though it took a couple of weeks, the vehicle eventually self-combusted – i.e. it went up in flames.

General Motors believes the fire occurred because the testers didn’t drain the energy from the Volt’s battery following the crash, which is a safety step the automaker recommends.

Government officials are weighing the need for new safety rules that could require first responders to drain electric vehicles’ batteries after a crash.

Note, they’re not investigating how to make the Volt safer, they’re determining whether fire-fighters have to drain the batteries when they arrive at an accident scene.

Cmon man …

>> Latest Posts

Tracking the progress at GM …

October 12, 2011

The U.S. Treasury aimed to sell more of its 26.5% stake in GM by August or September.

Then, the stock started tanking.

GM stock would need to hit $53 a share for the U.S government to break even on its $50 billion bailout of the auto maker.

At $30 a share, the U.S. would lose more than $10 billion on its $50 billion bailout of GM.

So far this year, GM stock is down about 40%

It was trading just over $22  this week,

Than makes the loss about $15 billion … but, who’s counting?

 

image

>> Latest Posts

To avoid the Gibson Guitars treatment, Ford pulls anti-bailout ad.

September 28, 2011

Punch line: As part of an ad campaign featuring “real people” explaining their decision to buy Fords, a guy named “Chris” says he “wasn’t going to buy another car that was bailed out by our government,”

Team Obama didn’t like the ad, and Ford pulled it so that Team Obama could stay focused on Gibson Guitars, S&P, and the tanning salons.

According to the Detroit News

Ford pulled the ad after individuals inside the White House questioned whether the copy was publicly denigrating the controversial bailout policy.

With President Barack Obama tuning his re-election campaign amid dismal economic conditions and simmering antipathy toward his stimulus spending and associated bailouts, the Ford ad carried the makings of a political liability when Team Obama can least afford yet another one. Can’t have that.

The ad, pulled in response to White House “questions” (and, presumably, carping from rival GM), threatened to rekindle the negative (if accurate) association just when the president wants credit for their positive results and to distance himself from any public downside of his decision.

In other words, where presidential politics and automotive marketing collide — clean, green, politically correct vehicles not included — the president wins and the automaker loses because the benefit of the battle isn’t worth the cost of waging it.

Once again, nothing like the Administration’s Chicago style politics.

Step out of line, and BAM !

>> Latest Posts

Ford ads a new benefit: buying from a company that stands on its own.

September 19, 2011

Punch lineFord hit the airwaves with a potentially controversial ad touting the fact that it’s an American company that stands on its own … unlike its bailed out competitors.

I like it …

Excerpted from US News: Ford TV Ad Slams Obama Auto Bailouts article & video

America is still fighting over President Obama’s costly bailout of Chrysler and General Motors. Especially the owners of Ford, the only member of Detroit’s “Big Three” who rejected the government dole and emerged perfectly healthy.

In its most political ad in the so-called “Drive One” ads where real drivers are thrust before cameras to explain why they picked Ford, a real Ford F-150 pick-up driver is featured.

His name is Chris. After he sits down the “reporters” bark “Chris, Chris.” One asks him to explain why “was buying American important to you.”

Sitting and looking sincere and serious, Chris says:

I wasn’t going to buy another car that was bailed out by our government.

I was going to buy from a manufacturer that’s standing on their own: win, lose, or draw.

That’s what America is about is taking the chance to succeed and understanding when you fail that you gotta’ pick yourself up and go back to work.

Ford is that company for me.”

Now, let’s see if Chris the Ford buyer gets tax audited like Joe the Plumber …

>> Latest Posts

Timmy shelves the sale of GM shares … for now, at least.

August 10, 2011

from the WSJ:

The Obama administration has put on hold plans to sell the rest of its stake in GM because the auto maker’s shares have slumped this year.

image

The U.S. Treasury aimed to sell more of its 26.5% stake in GM by August or September.

GM stock would need to hit $53 a share for the U.S government to break even on its $50 billion bailout of the auto maker.

At $30 a share, the U.S. would lose more than $10 billion on its $50 billion bailout of GM.

So far this year, GM stock is down 31%.

On Tuesday, GM stock closed at $25.54, up 97 cents.

OUCH !

>> Latest Posts

How many Chevy Volts sold in July?

August 5, 2011

According to Electric Cars Reports …

Despite thousands of dollars of government rebates, GM’s Chevrolet Division sold just 125 Volts in July — the worst monthly total for the Volt since it was introduced last year.

Birth-to-date, GM has sold only 3,196 units …Haven’t heard much about the Volt lately – have you?

>> Latest Posts

Remember the Feds stake in GM ?

August 3, 2011

Several post-debt deal articles have lumped it with the President’s other successes: ObamaCare, auto bailout …

According to the WSJ

“To break even, the U.S. Treasury would need to sell its remaining stake — about 500 million shares—at $53 apiece.”

Bad news: Stock closed on Aug. 2 at $27.05 … approximately 20% below the IPO price … about a $13 Billion loss.

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>> Latest Posts

A mockery of longstanding bankruptcy law …

July 11, 2011

When the history is written on Pres. Obama’s strained relationship with American business leaders, I think that the GM non-bankruptcy bankruptcy will be tagged as the the first critical shot fired (by the President).

Just in case you forgot, here’s a recap excerpted from Reason:

Many experts suspect that  GM could have obtained private bankruptcy financing if it had presented a credible restructuring plan addressing the cause of its malaise: the uncompetitive costs of its unionized work force.

If it couldn’t, then the government could have offered guarantees to private lenders for the amounts they loaned, which likely would have been smaller than the bailout.

But the administration took matters in its own hands, using taxpayer dollars to commandeer the bankruptcy process to protect key constituencies, while giving short shrift to others.

  • It gave Chrysler’s secured creditors, who would have had priority in a normal bankruptcy, 29 cents on the dollar.
  • Chrysler’s unions, on the other hand, got more than 40 cents, even though they are equivalent to low-priority lenders.

This made a mockery of longstanding bankruptcy law, something that will make credit markets wary of lending to political sacred cows in the future.

I think CEOs could have lived with Obama firing Richard Waggoner as CEO … and then firing his replacement, Fritz Henderson … and then firing his replacement, Ed Whitacre.

But, ignoring the rule of law and subordinating secured creditors to one of Obama’s core constituencies — overpaid union hacks – was over the top.

If there were any hopes of turning around the relationship, the Administration’s moves to keep Boeing from operating a plant in right-to-work South Carolina dashed them

>> Latest Posts

Hybrid car sales respond to high gas prices … with a thud.

June 22, 2011

The last time that gas prices soared, hybrid cars were  selling above their sticker prices.

Not so much this time.

According to USA Today, hybrid sales fell to only 1.6% of total auto sales – down from their 3.6% peak in 2009.

Why?

“Even with the fuel savings, it doesn’t make sense to buy a hybrid” for many buyers.”

Sure, gas prices hit $4, creating “economic value” versus conventional gas-engine cars … but the fuel savings has narrowed with the introduction of compacts that get 40 mpg and sell for considerably less than hybrids.

Sales of high-gas-mileage, conventional compacts such as the Hyundai Elantra, Ford Focus and Chevrolet Cruze are hot.

The new conventionally powered cars use various strategies to boost gas mileage to near hybrid levels — without the batteries and electric motors that can add $6,000 on average to a vehicle’s cost.

* * * * *
Volt update: Chevy sold 481 Volts in May … pushing it’s total since January up to a whopping  2,184.

* * * * *

GM’s Volt need a jolt …

April 22, 2011

One of Gov’t Motor’s main focuses has been the Obama-sponsored Chevy Volt, but …

  • Consumer Reports says GM’s hybrid “just doesn’t make a lot of sense.” … ouch.
  • More important, it isn’t selling — only 1,210 Volts have sold this year through the end of March … double ouch

In technical marketing jargon, the dogs ain’t eating the dogfood …

Full article: NY Post, ‘Government motors’ is still a lemon, April 18, 2011

Gov’t Motors’ shares hit new low… even gov’t is bailing

April 21, 2011

Where are the lemon laws when you need them?

Here’s a shocker: even a reconstituted company that’s stuck with the UAW doesn’t do very well.

GM had been showing some life, largely on the back of fuel guzzling pick-ups and SUVs.  But, increasing gas prices have (again) slowed that market down.

Surprise, surprise, surprise.

* * * * *

Excerpted from WSJ: U.S. Hurries to Sell GM Stake, April 19, 2011,

The U.S. government plans to sell a significant share of its remaining stake in GM. this summer despite the disappointing performance of the auto maker’s stock.

A sale within the next several months would almost certainly mean U.S. taxpayers will take a loss on their $50 billion rescue of the Detroit auto maker in 2009.

To break even, the U.S. Treasury would need to sell its remaining stake — about 500 million shares—at $53 apiece.

GM closed at $29.59 in trading Tuesday, hitting a new low since its $33-a-share November initial public offering.

image

Analysts say that GM shares have been hurt by rising fuel prices, industry production disruptions and management turnover.

GM share price could become further depressed after investors holding bonds of the now-bankrupt “old-GM” receive warrants and stock for existing GM shares. That will happen April 21.

LaHood: “I wouldn’t want anybody in my family driving a Chevy Cruze”

April 13, 2011

Just dreaming …

Remember when the Secretary of Transportation took to the airwaves to to tell people not to buy or drive Toyotas because they were unsafe?

Turned out that the problem was an auto service guy sticking the wrong floor mat in a car and a couple of folks hitting the accelerator instead of the brake.

But, since the gov’t owned GM —  one of Toyota’s main competitors —  LaHood just let it fly.

Now the plot thickens.

The Chevy Cruze is being recalled because its steering wheel comes off.

That’s right. it steering wheel can become detached.

No driver error.  No servicing mistake.

The steering wheel comes off.

Oops.

Do you think LaHood will issue another driver’s alert?

I’m betting ‘no’.

The solution is high-speed rail … what, pray tell, is the problem?

February 16, 2011

Seriously, have you heard anybody (except Reid & Obama) say “man, what this country needs is a $53 billion  “national high-speed rail system” ?

I sure haven’t.

Except for connecting liberal bastions DC, NYC and Boston .., and Disneyland and Las Vegas … I can’t figure out where it would run … and more important, who would ride it ?

Robert Samuelson of Newsweek sees a few other holes in the program …

The rail proposal casts doubt on the administration’s commitment to reducing huge budget deficits.

High-speed rail would definitely be big.

Transportation Secretary Ray LaHood has estimated the administration’s ultimate goal – bringing high-speed rail to 80 percent of the population – could cost $500 billion over 25 years.

For this stupendous sum, there would be scant public benefits. Precisely the opposite. Rail subsidies would threaten funding for more pressing public needs: schools, police, defense.

How can we know this? History, for starters.

In 1970, Congress created Amtrak to preserve intercity passenger trains.  The idea was that the system would become profitable and self-sustaining after an initial infusion of federal money. This never happened. Amtrak has swallowed $35 billion in subsidies, and they’re increasing by more than $1 billion annually.

Despite the subsidies, Amtrak does not provide low-cost transportation. Fares on Amtrak’s high-speed Acela start at $139 one-way; A comparable roundtrip bus fare: $21.50.

Nor does Amtrak do much to relieve congestion, cut oil use, reduce pollution or eliminate greenhouse gases. Its traffic volumes are simply too small to matter.

Measured by passenger-miles traveled, Amtrak represents one-tenth of 1 percent of the national total.

The reasons passenger rail service doesn’t work in America are well-known: Interstate highways shorten many trip times; suburbanization has fragmented destination points; air travel is quicker and more flexible for long distances.

Even if ridership increased fifteenfold over Amtrak levels, the effects on congestion, national fuel consumption and emissions would still be trivial.

What’s disheartening about the Obama administration’s embrace of high-speed rail is that it ignores history, evidence and logic.

The case against it is overwhelming.  High-speed rail is not an “investment in the future”; it’s mostly a waste of money.

High Speed Rail a Fast Track to Waste, February 14, 2011

Simple question: Why hasn’t Obama fired Ray LaHood?

February 10, 2011

Ray LaHood is Obama’s Transportation Secretary.

The guy who excorciated Toyota for making unsafe cars.

“I wouldn’t let anybody in my family drive one.  They’re not safe.”

No evidence.  Just hearsay.

No investigation.  Just anecdotes and ambulance chasers.

Toyota loses millions.  Government-owned GM surges.

Now, it’s “pedal misapplication”.  Not electronics.

Either LaHodd is totally irresponsible or frightfully conniving.

Either way, he should be fired

Let’s see if Obama has the moral clarity and ‘nads to do what’s right.

I’m taking the under on the bet …

GM’s UAW workers get windfall bonus … and, oh yeah, Toyota’s innocent.

February 9, 2011

From the ‘makes your blood boil’ file:

Yesterday, there were 2 seemingly unrelated news stories … I say ‘seemingly’ because the mainstream media hasn’t picked up on the connection.

First, the WSJ reported that GM (aka, Government Motors)  is planning to pay its hourly workers  at least $3,000 each in profit-sharing payouts, the largest amount ever.  Why? Because the company miraculously returned to profitability in 2010. The profit-sharing checks will go to 45,000 workers as part of the auto maker’s contract with the United Auto Workers union.

Now, let’s stop and think for a moment.

How did GM return to profitability?

Through increased UAW productivity?

Nah.

First, GM wiped out shareholders and – completely ignoring contract law — moved the union pension claims ahead of its bona fide secured creditors. Get rid of your debt – and its related interest – and your economics change a bit.

Then, toss a couple of billion dollars of excess plants & equipment into a new corporate entity … just get it off your books.

Then, have one of your owners – in this case the Federal government – make some bogus claims against one of your major competitors.  Maybe have the President and Secretary of Transportation declare that the competitor’s cars are unsafe to drive.  That might dampen their sales … and increase your’s.

So what if the claims are largely unfounded.  Go for it.

Now, for the other news story.

The WSJ reported that NASA and the National Highway Traffic Safety Administration conducted a 10-month-long study on Toyota’s apparent acceleration problems.

Based on the study they absolved the electronics in Toyota’s vehicles for unintended acceleration, and said driver error was to blame for most of the incidents.

While floor mats sometimes got caught under the throttle, the  most common problem was drivers hitting the gas when they thought they were hitting the brake, which the NHTSA called “pedal misapplication.”

So tell me again why the overpaid, over-pensioned UAW workers are getting bonuses …

Does the Volt have enough power to cross the chasm?

January 31, 2011

TakeAway: Like many new, innovative products, there is an adoption chasm between the early adopters and the early majority.

While the new Chevy Volt has already demonstrated appeal to the early tech adopters, there are some issues that could spell trouble.

One, the short battery range doesn’t really offer a complete solution to eliminating the need for gasoline.

Two, once you have exhausted the battery, it’s just another car.  Until the battery technology improves, the “killer application” seems to be lacking.

 * * * * *

Excerpted from NPR, “Electric Cars Steal the Spotlight at Auto Show,” by Sonari Glinton, January 14, 2011

When the North American International Auto Show opens in Detroit on Friday, there’s going to be electricity in the air.

… the star of the show is the Chevy Volt, the electric car with a backup gas engine. It won the top prize — the 2011 North American Car of the Year. …

GM has high hopes that the Volt will be adopted by a mainstream audience.

“Today a lot of our customers are early tech adopters — typically the first on the block to have an iPhone or an iPad,” says Tony DiSalle, the head of marketing for the Chevy Volt. He thinks those numbers will improve over time.

“The most important thing is to get consumers — mass-market consumers — to understand the benefits of the Volt,” DiSalle says.

GM expects to sell about 10,000 Volts this year. In 2012, the company will ramp up production to about 45,000 cars. But even that figure is small compared with the more than 2.2 million cars and trucks that GM’s four brands sold in 2010. …

One of the barriers to the adoption of the electric car is a phrase that keeps coming up at the auto show — range anxiety. Many of the cars on display can only travel under electric power for short ranges. Analysts say that until the big car companies can conquer consumer fears of running out of charge, electric vehicles will remain on the fringes.

“Look, the electrification of the American fleet is not going to happen overnight,” says Bob Lutz, who retired as vice chairman of GM in May.

… He says electrification will be a gradual process, predicting that it will take until 2025 for electric vehicles to account for 10 percent to 15 percent of the overall market. …

Edit by DMG

Does the Volt have enough power to cross the chasm?

January 31, 2011

TakeAway: Like many new, innovative products, there is an adoption chasm between the early adopters and the early majority.

While the new Chevy Volt has already demonstrated appeal to the early tech adopters, there are some issues that could spell trouble.

One, the short battery range doesn’t really offer a complete solution to eliminating the need for gasoline.

Two, once you have exhausted the battery, it’s just another car.  Until the battery technology improves, the “killer application” seems to be lacking.

 * * * * *

Excerpted from NPR, “Electric Cars Steal the Spotlight at Auto Show,” by Sonari Glinton, January 14, 2011

When the North American International Auto Show opens in Detroit on Friday, there’s going to be electricity in the air.

… the star of the show is the Chevy Volt, the electric car with a backup gas engine. It won the top prize — the 2011 North American Car of the Year. …

GM has high hopes that the Volt will be adopted by a mainstream audience.

“Today a lot of our customers are early tech adopters — typically the first on the block to have an iPhone or an iPad,” says Tony DiSalle, the head of marketing for the Chevy Volt. He thinks those numbers will improve over time.

“The most important thing is to get consumers — mass-market consumers — to understand the benefits of the Volt,” DiSalle says.

GM expects to sell about 10,000 Volts this year. In 2012, the company will ramp up production to about 45,000 cars. But even that figure is small compared with the more than 2.2 million cars and trucks that GM’s four brands sold in 2010. …

One of the barriers to the adoption of the electric car is a phrase that keeps coming up at the auto show — range anxiety. Many of the cars on display can only travel under electric power for short ranges. Analysts say that until the big car companies can conquer consumer fears of running out of charge, electric vehicles will remain on the fringes.

“Look, the electrification of the American fleet is not going to happen overnight,” says Bob Lutz, who retired as vice chairman of GM in May.

… He says electrification will be a gradual process, predicting that it will take until 2025 for electric vehicles to account for 10 percent to 15 percent of the overall market. …

Edit by DMG

That sound you don’t hear is the rush to electric cars …

January 6, 2011

Interesting article in Business Week titled “Electric Cars Get Charged for Battle” … worth reading.

Here are a couple of points that caught my eye …

P.S. Is it just me, or has Business Week been swinging left since being bought by Bloomberg?

* * * * *

After 10 years as the world leader in hybrids, Toyota has never sold more than 187,000 Priuses in the U.S. in a year.

  • Prius sales peaked in 2007, just before the financial meltdown, and have dropped since then as fuel prices retreated.

Nissan manufactures its own batteries in a joint venture with NEC, and they account for roughly half the cost of the car,

78% of drivers go less than 40 miles daily; 95% drive fewer than 100 miles a day.

The best guess  is that 80 percent of charging will take place at home.

  • Charging an electric car with a standard 120-volt outlet can take up to 18 hours; 5 to 8 hours to charge one with a more powerful 240-volt outlet.
  • But, buying a 240-volt charger requires contacting a utility to see if the neighborhood transformer can handle the load, getting a contractor to install the 240-volt charger in your garage, and having the city inspect it.
  • It can cost anywhere from a few hundred dollars to $3,000 and take a month or two.

There are 106,000 gas stations coast to coast in the U.S. … 13,000 public chargers are expected to be in the ground by the end of 2011;

  • Cracker Barrel restaurant chain recently announced that it would install chargers at 24 of its interstate locations
    Question: Think Cracker Barrel & electric cars attract the same demongraphics?* 

Nissan sorted potential launch markets according to three main criteria.

  • (1) places that had EV incentives left over from the late 1990s-early 2000s.
  • (2) places with a high density of hybrid customers. (Of the early Leaf buyers, almost half have owned Priuses.)
  • (3) states where the local utilities were willing to upgrade their grids if needed.

Wave One: Washington, Oregon, California, Arizona, Tennessee, Texas, and Hawaii.

Business Week, Electric Cars Get Charged for Battle, December 29, 2010
http://www.businessweek.com/magazine/content/11_02/b4210048400234.htm

* Thanks to JMH for question