GM cancels future RWD vehicles
04-11-2007, 04:25 AM
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GM cancels future RWD vehicles
The new RWD Camaro and Impala are still a go according to CEO Bob Lutz because they are too far along in design and planning to be cancelled. Lutz estimates that the new CAFE standards will raise auto production costs upwards of $5000/vehicle in order to meet a proposed CAFE 4%/year fuel economy improvement target.
http://www.chicagotribune.com/business/chi...hi-bizfront-hed
Andrew
http://www.chicagotribune.com/business/chi...hi-bizfront-hed
GM puts brake on rear-drive vehicles
Published April 10, 2007
General Motors has put a hold on future rear-wheel-drive vehicles.
"We've pushed the pause button. It's no longer full speed ahead," Vice Chairman Bob Lutz revealed in an interview.
Two of the most important RWD cars in the works are the Chevy Camaro sports coupe due back late in 2008 and the full-size, RWD replacement for the Chevy Impala sedan for 2009. Both are expected to be huge sellers and contribute major profits to a GM till burdened with IOUs the last few years.
"It's too late to stop Camaro, but anything after that is questionable or on the bubble," said Lutz, noting that also means Camaro derivatives -- along with a big Impala sedan, "if we call it Impala."
The RWD cars, you see, would be larger and heavier than front-wheel-drive cars or are high-performance models.
So it comes down to the matter of fuel economy. Or as Lutz says: "We don't know how to get 30 percent better mileage from" RWD cars.
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
"We'll decide on our rear-drive cars when the government decides on CO(-2) levels and CAFE regulations," Lutz said, adding that limiting CO(-2) would increase mileage, too.
"Carbon dioxide is a natural byproduct of burning gas and directly proportional to the amount of fuel burned. If we legislate CO(-2) from cars, why not legislate we take one less breath per minute since humans release capricious amounts of CO(-2) each time they exhale?" offered a testy Lutz.
Lutz also points out that higher mileage will come at a price, with the proposal to raise CAFE certain to increase costs by as much as $5,000, which will be added to a car's sticker, an amount most consumers won't be willing to pay. There are no hard numbers for how much CAFE compliance adds to the sticker now.
"Rather than buy new, people would hang onto their old cars. We could eat the $5,000, but that would put us out of business."
Besides, those who see cars as more than just an appliance are eager for the new RWD offerings.
Among other cars affected are a high-performance midsize Pontiac, a replacement for the full-size Buick Lucerne sedan, a compact smaller than the current CTS at Cadillac and possible 300-horsepower versions of the Pontiac Solstice and Saturn Sky roadsters.
"This is very disappointing," noted Erich Merkle, director of forecasting for IRN Inc., in Grand Rapids, Mich. Most of the cars coming are necessary to GM's turnaround as showroom magnets.
"What the public buys makes CAFE work, not what the industry builds," Merkle added. "To improve mileage you change demand, not supply, by raising gas prices through taxes. But no politician is going to do that so they throw the responsibility on the back of the industry."
Lutz also objects to the talk that carmakers can easily raise mileage with a very low investment.
"Academics assure us that for $200 we can get 30 percent better mileage. If anyone can figure out how to do that for $200 -- or even for $1,000 -- I want them in my office today. Show me how to do it and we'll adopt it," he said. "If I could increase mileage by 30 percent for $200, why wouldn't I? What's my motivation not to when a gas-electric hybrid gets 27 percent better mileage and I hope someday to get the cost down to $9,000?"
Others insist that carmakers simply have to sell more small cars, such as the trio of 1-liter concepts that promise 40 m.p.g.-plus that GM unveiled at the New York Auto Show.
"Small-car mileage only counts toward CAFE if you build them here, and you can't build small cars here at a profit," Lutz said, explaining that foreign-made cars would count toward the automaker's import fleet, and its domestic fleet is where GM needs help.
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Published April 10, 2007
General Motors has put a hold on future rear-wheel-drive vehicles.
"We've pushed the pause button. It's no longer full speed ahead," Vice Chairman Bob Lutz revealed in an interview.
Two of the most important RWD cars in the works are the Chevy Camaro sports coupe due back late in 2008 and the full-size, RWD replacement for the Chevy Impala sedan for 2009. Both are expected to be huge sellers and contribute major profits to a GM till burdened with IOUs the last few years.
"It's too late to stop Camaro, but anything after that is questionable or on the bubble," said Lutz, noting that also means Camaro derivatives -- along with a big Impala sedan, "if we call it Impala."
The RWD cars, you see, would be larger and heavier than front-wheel-drive cars or are high-performance models.
So it comes down to the matter of fuel economy. Or as Lutz says: "We don't know how to get 30 percent better mileage from" RWD cars.
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
"We'll decide on our rear-drive cars when the government decides on CO(-2) levels and CAFE regulations," Lutz said, adding that limiting CO(-2) would increase mileage, too.
"Carbon dioxide is a natural byproduct of burning gas and directly proportional to the amount of fuel burned. If we legislate CO(-2) from cars, why not legislate we take one less breath per minute since humans release capricious amounts of CO(-2) each time they exhale?" offered a testy Lutz.
Lutz also points out that higher mileage will come at a price, with the proposal to raise CAFE certain to increase costs by as much as $5,000, which will be added to a car's sticker, an amount most consumers won't be willing to pay. There are no hard numbers for how much CAFE compliance adds to the sticker now.
"Rather than buy new, people would hang onto their old cars. We could eat the $5,000, but that would put us out of business."
Besides, those who see cars as more than just an appliance are eager for the new RWD offerings.
Among other cars affected are a high-performance midsize Pontiac, a replacement for the full-size Buick Lucerne sedan, a compact smaller than the current CTS at Cadillac and possible 300-horsepower versions of the Pontiac Solstice and Saturn Sky roadsters.
"This is very disappointing," noted Erich Merkle, director of forecasting for IRN Inc., in Grand Rapids, Mich. Most of the cars coming are necessary to GM's turnaround as showroom magnets.
"What the public buys makes CAFE work, not what the industry builds," Merkle added. "To improve mileage you change demand, not supply, by raising gas prices through taxes. But no politician is going to do that so they throw the responsibility on the back of the industry."
Lutz also objects to the talk that carmakers can easily raise mileage with a very low investment.
"Academics assure us that for $200 we can get 30 percent better mileage. If anyone can figure out how to do that for $200 -- or even for $1,000 -- I want them in my office today. Show me how to do it and we'll adopt it," he said. "If I could increase mileage by 30 percent for $200, why wouldn't I? What's my motivation not to when a gas-electric hybrid gets 27 percent better mileage and I hope someday to get the cost down to $9,000?"
Others insist that carmakers simply have to sell more small cars, such as the trio of 1-liter concepts that promise 40 m.p.g.-plus that GM unveiled at the New York Auto Show.
"Small-car mileage only counts toward CAFE if you build them here, and you can't build small cars here at a profit," Lutz said, explaining that foreign-made cars would count toward the automaker's import fleet, and its domestic fleet is where GM needs help.
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04-11-2007, 04:57 AM
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GM should just fold up the tent and go home.
The only cars that were worth building are being canceled (save the Vette).
I could care less, there are so many other compaines with stones that can build both rwd cars as well as meet CAFE standards (toyota, Nissan, BMW, MB etc..)
Here is a clue to GM, build a nice small car thats worth a darn and then you can offset the larger heavier cars. Or make cars that are worth paying the extra money for and people will buy them.
GM wants to pick the low lying fruit to take the easy sales but doesn't want to build great cars because thats too hard to do. Boo hoo. How can a company that builds the Z06 be so pathetic in other areas?
The only cars that were worth building are being canceled (save the Vette).
I could care less, there are so many other compaines with stones that can build both rwd cars as well as meet CAFE standards (toyota, Nissan, BMW, MB etc..)
Here is a clue to GM, build a nice small car thats worth a darn and then you can offset the larger heavier cars. Or make cars that are worth paying the extra money for and people will buy them.
GM wants to pick the low lying fruit to take the easy sales but doesn't want to build great cars because thats too hard to do. Boo hoo. How can a company that builds the Z06 be so pathetic in other areas?
04-11-2007, 05:13 AM
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Well here is the real problem...
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
04-11-2007, 05:26 AM
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Rather than bitching about the new standard, Honda and Toyota will probably come up with innovative ways to increase fuel economy, decrease emissions, and increase performance in their future offerings. I am normally a fan of Lutz, but I am disappointed by his attitude on this issue. GM was aware of the proposed standards and should have planned their product lineup accordingly.
04-11-2007, 05:45 AM
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Originally Posted by Triple-H,Apr 11 2007, 05:13 AM
Well here is the real problem...
[b]That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year
[b]That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year
Toyota will licence the Prius technology to anyone (I think) they want it to be like "Intel Inside".
04-11-2007, 05:53 AM
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Originally Posted by Triple-H,Apr 11 2007, 01:13 PM
Well here is the real problem...
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
That 30 percent bogey arises from a proposal by the Bush administration to raise corporate average fuel economy (CAFE) standards by 4 percent a year so cars would have to average 34 m.p.g. by 2017, up from 27.5 m.p.g. today. On top of that, the Supreme Court ruled last week that the Environmental Protection Agency can regulate carbon dioxide expelled by cars, a gas that contributes to global warming. The EPA doesn't do so now.
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04-11-2007, 06:09 AM
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They need to start instituting CAFE standards for trucks and SUV's to make any real difference. Does anybody really think that increasing car fuel economy by 7 MPG is going to really have that big of an effect when it seems like half the vehicles on the road are trucks that are lucky to get 15 MPG?
04-11-2007, 06:10 AM
#10
This is such crap that GM would even think of bitching about this. It will not add $5000 to the cost of every car either. You could improve the milage of every GM truck and SUV by putting in different gearing. It would not get to sixty as fast, but the milage would improve. That one is on me GM.
They are just complaining because most of their money comes from gas hogs, and when Tahoes and Escalades can no longer have the 400 hp engines to get their fat asses to sixty in an entertaining time. And that will make them less attractive. How much would it save them in steel costs to take a ton of weight out of the average vehicle they put on the road?
It seems to me that every GM leg humper says the Vette gets 30 on the highway. So whats the problem? They have ten years to boost it four mile per gallon. If more of what they built weighed closer to the vette instead of 9 tons, it would not be a problem.
The last time CAFE was raised, Ford and GM cried foul, but Chrysler was already within the higher standards. Its just laziness. If they made more of an effort to make their fleet get better milage their sales would be better than what they are today.
This concept seems to be too abstruse for the domestics:
THE FACT THAT HONDA AND TOYOTA HAVE MADE FUEL EFFICIENCY A PRIORITY AND HAVE STRONG SALES ARE NOT MUTUALLY EXCLUSIVE NOR INCONGRUENT.
If they could figure that out they'd be fine.
They are just complaining because most of their money comes from gas hogs, and when Tahoes and Escalades can no longer have the 400 hp engines to get their fat asses to sixty in an entertaining time. And that will make them less attractive. How much would it save them in steel costs to take a ton of weight out of the average vehicle they put on the road?
It seems to me that every GM leg humper says the Vette gets 30 on the highway. So whats the problem? They have ten years to boost it four mile per gallon. If more of what they built weighed closer to the vette instead of 9 tons, it would not be a problem.
The last time CAFE was raised, Ford and GM cried foul, but Chrysler was already within the higher standards. Its just laziness. If they made more of an effort to make their fleet get better milage their sales would be better than what they are today.
This concept seems to be too abstruse for the domestics:
THE FACT THAT HONDA AND TOYOTA HAVE MADE FUEL EFFICIENCY A PRIORITY AND HAVE STRONG SALES ARE NOT MUTUALLY EXCLUSIVE NOR INCONGRUENT.
If they could figure that out they'd be fine.