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Perspective: A View Into the New GM

by Bill Cooke

The Saturn version of the two-mode plug-in hybrid at the Milford Proving Grounds. Click to enlarge.

On 11 August, GM invited approximately 75 journalists and auto analysts to spend a day learning about the new GM. The day was split between a morning session at the GM tech center in Warren and an afternoon session at the GM proving grounds in Milford, MI.

The morning session started out with an hour long press conference, the highlight being the unveiling of the Volt’s 230 mpg preliminary EPA city fuel economy finding (earlier post), as well as a tour showing selected elements from the studios of the four GM North American brands: Chevrolet, GMC, Buick and Cadillac.

GM also gave a tour of the pre-production area where we could see production-intent Chevy Volts being assembled. GM is producing 2 vehicles a day with the goal of having a total of 76 vehicles available by the end of the summer; these vehicles will be used for validation testing ranging from fit and finish reviews, to durability testing to eventual crash testing.

The afternoon was spent at the Milford Proving Grounds which covers 4,000 acres and includes over 132 miles of roads ranging from “ordinary” suburban lanes to a high speed test track. The facility is very well maintained and gives the impression of being on a gigantic movie set, since it is full of buildings and roads but contains relatively very few people.

We had three hours to quiz various technical experts, drive a variety of cars and talk to the senior leadership. The people I talked about realized you only get one second chance, were very thankful for the government support and were enthusiastic about the products they had coming out over the next 24 months.

Aside from a box lunch, a couple of bottles of water and two absolutely delicious chocolate chip cookies, GCC received no compensation, expense reimbursement or branded merchandise from GM to attend the event.

Establishing four core brands

GM’s identify in the US starts with its four core brands. Going forward, GM plans to spend proportionally less of its marketing budget on the corporate identity and more on the vehicle brands.

  • Chevrolet is a global value leader. Fritz Henderson, GM’s President and CEO: “We had a couple of Audi and BMW customers sit in an Equinox and say ‘this vehicle should be priced well above what it is’—Chevrolet should blow people away for what they get for their money.

  • Buick will focus on North America and China. One of the designers called Buick “premium without being pretentious” Buick appears to be targeting a Lexus like experience. The Enclave was the first step in the “renaissance of the Buick brand” as mentioned by another designer.

  • GMC is “professional grade” and will focus on North America and the Middle East. Several leaders throughout the day mentioned that GMC was one of the most profitable brands, has a very strong customer base and does very well with women in North America.

  • Cadillac conveys the philosophy of “Art and Science” globally, with “Art” representing an appeal to aesthetics while “Science” indicates advanced technology. Byran Nesbitt, Cadillac’s general manager, added that “Dedicated resources, studio and engineering, allows us to nurture and build the brand identity.

Build better products

The Cadillac Converj extended-range electric vehicle Concept uses the Voltec platform. Click to enlarge.

Fritz Henderson emphasized: “the only way we’re going to make GM great again is to win in the market. We can have a competitive cost structure, we can have a competitive capital structure, we can have the best discount rates but we need to have the best product.

In April 2009, Consumer Reports recommended only 17% of the GM cars they tested while they recommended 70% of the Fords. In the same issue Consumer Reports mentioned that “GM has made big strides with good performers. But too many older models drag it down.

Those words were written before bankruptcy and the culling of GM’s lineup. By eliminating the weaker brands and weaker models, GM can focus more of their resources on their stronger products. As one of the GM employees at the event told me, “We can make each car great, we don’t have to worry about cannibalizing sales from a sister vehicle.

As part of the culling, GM has the option to re-badge vehicles from the non-core brands, such as the Pontiac G8, Opel Insignia and Saturn Vue. At this point it looks like only the Opel Insignia will be acting as inspiration for another vehicle. [And at this writing, the issue of Opel’s future ownership has yet to be settled.] Re-badging is a sensitive topic with the OEMs and their desire to highlight the differences among brands.

GM produces several successful vehicles:

  • The Chevy Malibu has won several car of the years awards and is recommended by Consumer Reports.
  • Consumer Reports rates the Buick Enclave higher than vehicles from Toyota, Volvo, Infiniti, Audi, BMW and Mercedes Benz in the Luxury- Full Size SUV category.
  • The Cadillac CTS/CTS-V is on Car and Drivers Top Ten list and in the July 2009 issue Motor Trend said “Yet where it really matters, as a performance sedan, the CTS-V soundly spanks the BMW M5. It is quicker in the straight line, handles better, steers better, even rides better.” It also offers better fuel economy than the M5. I had the opportunity to drive a CTS-V around the test track and although it is incredibly “ungreen” it is also insanely fun to drive. The vehicle seems to defy the law of physics.

I was also able to drive several GM vehicles that were more environmentally responsible. The Chevy Equinox with a 2.4L 4 cylinder direct-injection Ecotec engine and 6-speed automatic transmission offers class leading fuel economy while maintaining sprightly acceleration. The chief engineer I rode with, Raymond Chess, can drive just about any GM vehicle he wants but he was going to order the four cylinder Equinox for his next lease car.

Most of the new vehicles have received special praise for their interiors, which has been a priority for GM since Bob Lutz assumed product design responsibilities in 2001. His goal has been to offer interiors that are a segment above the vehicle’s price point.

In a review for the European version of the Chevy Cruze (The US version is a 2011 vehicle), Jens Meiners writes in Car and Driver: “Like the larger Malibu, the interior of the Cruze shines”. The interior for the new LaCrosse is called “gorgeous” by Car and Driver and “if the exterior entices, the interior could seal the deal” in Motor Trend.

GM still has to work to do in several areas. Almost all of their vehicles weigh more than their Japanese competition which means a sacrifice to performance or fuel economy or both. In the 2009 annual auto review Consumer Reports points out that for GM overall, “reliability has not been consistent” and reliability concerns prevent the high scoring Cadillac CTS and Buick Enclave from being recommended by Consumer Reports.

GM had been announcing they were planning on launching 25 vehicles over the next 24 months but with the cancellation of the Buick compact crossover (and its plug-in hybrid variant, earlier post) that number may drop to 24 vehicles.

Fritz Henderson points out that “Every vehicle that we are going to launch between here and 2014 is either going to be a car or a crossover. The money that we spend on full-size trucks and full-size SUVs will be to improve their fuel economy to get them to where they need to be” to meet the revised CAFE standards. Henderson goes on to say “We (GM) have never missed a fuel economy standard and don’t intend to miss one in the future.

Focus on fuel economy

GM says it is committed to establishing a harmonized national program to improve fuel economy and lower greenhouse gas emissions. Click to enlarge.

With CAFE’s renewed emphasis on fuel economy, from 26 mpg in 2010 to 35.5 mpg in 2016, GM’s short term answer is to get greater mileage out of existing gasoline engine technologies.

The 2.4L Ecotec VVT I-4 will have E85 versions, starting in 2010. The number of flex fuel models will grow from 17 in 2010 to 28 in 2012 and will account for 50% of GM’s production.

Direct injection will be available on 13 models in 2010. Direct Injection can improve fuel economy by 3% and reduce cold start emissions by 25%. GM expects the number of vehicles sold with direct injection to double between 2010 and 2012 to 1.2 million. The 3.6L Direct Injection V6 is a Ward’s automotive “Top Ten Engine” of the year in 2009.

Active Fuel Management shuts off half of the cylinders during low load conditions. It can improve fuel economy by 12%. GM has 11 models available with AFM in 2010.

Variable Valve Timing that allows the timing of the valves to be adjusted. It can improve fuel economy by 2%. GM has 24 models available with VVT in 2010.

Homogeneous Charge Compression Ignition (HCCI)

HCCI represents a longer term solution. I was able to spend 10 minutes driving a Saturn Aura sedan with an (HCCI) engine system. GM expects HCCI, when combined with enabling technologies like variable valve actuation and advanced electronic engine controls, to provide a 12-15% improvement in overall fuel economy while being more affordable than hybrid or diesel technologies. (Earlier post.)

As a gasoline technology, HCCI provides the fuel economy benefits of lean burn without requiring additional NOx after treatment. During HCCI operation the engine creates a low temperature, flameless, release of energy that is “initiated by retaining the heat from the previous combustion cycle. This is controlled auto ignition. I don’t have a specific event that triggers combustion like a spark for gasoline engines or fuel injection event for a diesel, ” explains Vijay Ramappan, a GM development engineer.

An HCCI engine will operate in three modes:

  • Pure spark ignition mode,during high loads and cold engine start-up, which is similar to a traditional gas engine.
  • A pure HCCI mode, during light to medium loads, when no spark event is required for combustion.
  • A mixed HCCI mode, light loads and moderately cold engine, where a spark is used to initiate but the bulk of the combustion is done by HCCI. The fuel efficiency gains are similar between pure HCCI and mixed HCCI modes.

GM expects the technology to be in the market within 10 years and for a vehicle to operate in HCCI mode during low load urban driving all the way up to 60 mph on a flat surface.

During my test drive I drove a 3.2 km urban loop and approximately 2/3 of the time I was in HCCI mode (primarily pure HCCI mode). HCCI does have a drawback, “the combustion process is louder, it is more like a diesel, we’re working on ways to minimize the NVH, especially during the transition between SI mode and HCCI on the high end” said Ramappan. To my untrained ear the difference between HCCI and SI wasn’t distracting.

Two-Mode Plug in Hybrid Electric Vehicle (PHEV)

I also had the opportunity to drive the two-mode Plug in Hybrid Electric Vehicle system that was slated to go into the Buick Crossover. It is a nice powertrain and I hope it finds another home quickly. Although an electric range of 10 miles may not sound too impressive, the more frequently a battery is fully discharged during normal operation, and subsequently recharged from the grid, the faster the consumer sees a return on their battery investment. (Earlier post.)

Although battery economics circa 2011 may not make the PHEV powertrain financially attractive without subsidy, it gives the technical GM-(CPI/LG Chem) team an opportunity to apply what they’ve learned from the Volt on a new vehicle and the marketing team an opportunity to understand how consumers react to a vehicle with 10 miles of electric range versus 40 miles for the Volt.


GM views the fuel cell electric vehicle as the outcome of the progression of increasing electrification. Click to enlarge.

GM is still continuing to invest in hydrogen vehicle development. Currently, they have a fleet of 116 vehicles spread throughout the world: Los Angeles, NYC, Washington, Berlin, Shanghai and Seoul. These 4th Generation vehicles are modified Chevy Equinoxes and have been on the street since the fall of 2007 as part of Project Driveway. GM is developing a fifth generation system for 2015 which will have substantially longer range and a much smaller fuel cell stack than the generation four system.

GM sees energy storage density as one of the attractive attributes of hydrogen, compared to a straight battery-electric solution. Click to enlarge.

No increase in the role of diesels

On 3 August GM announced they were tabling the 4.5L diesel engine for light trucks due to fuel prices and capital constraints (earlier post). When asked about diesels for passenger cars, like the Jetta TDI, Fritz Henderson said “We have the capability to do diesels in the US, we build them in Europe but the emissions standards will be much tougher here in the next two or three years which is going to require a ‘chemical factory’ in the rear of your car (to treat the emissions).

[There is a growing sense among some OEMs and suppliers that another round of even more restrictive emissions regulations is on the horizon, targeting SULEV/Tier 2 Bin 2 as the base rather than Bin 5 as the 50-state standard. (Earlier post.)]

Bob Lutz (Vice Chairman, Marketing and Communications) added: “The problem with diesel is that you are ultimately going to spend $5,000 or $6000 more for the car and with a chemical factory the fuel economy is 20% better not 30% better, and with the 20% fuel economy gain you have the privilege of paying 20% more for your fuel.

In Europe diesels are more popular but the European tax regimes raise the prices of all liquid fuels, which favors efficiency, while penalizing diesel fuel less than gasoline. Fritz Henderson added, “We see pretty significant shifts in market share in Europe between diesel and gas engines when the tax regimes change. We are putting our bets here in the US on electrics and hybrids and improving the performance of our gas engines. Electricity diversifies us away from petroleum.

Improve communications/responsiveness

GM has gotten a lot of mileage (and some flak) out of the potential for the Volt to have an EPA city fuel economy rating of 230 MPG. “You saw the reaction in the room today, it was astonishment, at how high the number was” said one senior leader referring to the unveiling press conference and the 230 mpg number.

The Volt is a hedge and a halo for GM but it won’t turn the company around by itself. John Hoffecker of AlixPartners predicts that in 2013 the US market will return to “normal” and be 15-16 million units/year. GM needs 20% of the market to survive which translates to 3-3.5 million vehicles/year. The Volt’s capacity is 60,000 vehicles/year or 2% of GM’s sales. GM needs strong products for the remaining 98% of their sales.

The Volt acts as a hedge for the potential of electrification to be a disruptive vehicle technology. By keeping a significant portion of the system engineering in-house while outsourcing key components to subject matter expert suppliers, GM should be able to leverage this knowledge to stay ahead of the cost curve for future generations. The Volt acts as a halo because, aside from the Volt, almost all of the news about GM recently has been negative.

GM runs the risk of tarnishing its own halo. GM has received criticism for advertising an efficiency statistic (the 230 mpg) that only measures one of the two energy inputs into the vehicle. In GM’s defense, their press release mentioned the vehicle’s electrical fuel economy—25 kWh / 100 miles and also mentioned that the liquid fuel performance was based upon a vehicle being recharged from the grid...but none of that data was on the “230” banner.

After printing up large banners and having ads out emphasizing the 230 mpg, if the Volt does not deliver on this number in a way that is easily understood by the consumer it’s recipe for a public relations disaster. People will remember the 230 mpg was a stat that GM touted and promised, it wasn’t leaked.

—Mike Pfeiffer, Marketing Consultant for MPAD Services

On 10 August, GM hosted 100 people, many of them recruited through GM’s web site, to spend a day reviewing GM’s future products and driving representative vehicles. Henderson on the process:

It wasn’t a statistical process, it was more people who corresponded with us. We got a bigger cross section from across the United States, a pretty good cross section of younger people. We have a tremendous base of loyal GM customers, we do a tremendous amount of work to retain their loyalty, we have to do that. But we also have to change the mind of people who do not give us consideration today. We tried to invite them in and many said, yes, we would come. Some of them are severe critics who were very thoughtful and coming back and hitting us hard.

As one outcome, GM cancelled the new Buick crossover announced shortly before.

To quote the 19 August “Reports from the Front” post by Tom Stephens, GM Vice Chairman - Global Product Development: “The Buick crossover we showed received consistent feedback from large parts of the audiences that it didn’t fit the premium characteristics that customers have come to expect from Buick.

Overall, the commentary on the GM website linked to the decision was popular, no one defended the ill-fated Buick Crossover. But further reading on the site pointed out issues with relying on the web.

While they may provide useful input in the development stages and it is easily accessible, solely relaying on message boards and blogs for guidance is dangerous. Between mixed messages and dubious motivations you may get data that does not necessarily reflect your target audience’s true reaction to the product.

—Mike Pfeiffer of MPAD Services

At the media event on 11 August, Ray Young, Executive Vice President and Chief Financial Officer, mentioned that “Decisions are being made faster with Fritz Henderson. The management team has been streamlined. We just had a meeting this morning and we went ‘bang, bang, bang’ through the decisions.” Four days later, Ray’s words became prophetic when GM canceled the Buick crossover program.

When asked which companies he admires Fritz Henderson said, “Let me talk about non-automotive companies. I think Caterpillar does a fantastic job. Global company, heavy manufacturing, heavily unionized work environment, their brand is strong, we had a chance to benchmark them. GE is a fine company, Apple is a fine company as far as building a brand.

Ideally, GM can emulate some of the Apple’s product development expertise because by canceling a program two weeks after announcing it, GM is publicly admitting they need to overhaul their product definition process. In the auto business, programs aren’t “announced” until fairly late in the product development process. “If GM had gotten the appropriate feedback sooner they may have saved themselves a lot of time and money” according to MPAD’s Pfeiffer. GM can cancel a program in minutes, it takes three years to develop a product from scratch.


GM has the potential to be successful in the 21st century. They’ve shown, that on occasion, they can produce segment leading cars, they have access to some promising powertrain technologies and their interiors are first class. Although Fritz Henderson may be correct that in a post-bankruptcy world, GM needs to improve their product more than their cost structure, GM was doomed to fail with its pre-bankruptcy structure.

Although progress had been made prior to the filing, in 2006 the Stout Risius Ross consulting firm had estimated the labor cost difference between the Detroit Three and the Japanese transplants was worth $1,200 to $1,500 vehicle. On many vehicles, GM inevitably tried to make up the gap by taking cost out of the vehicles which led to lower perceived quality which led to a lower transaction price which led to the 2007 Malibu being sold to rental fleets and underwhelming customers who rented one.

The cost issues at GM ran deeper than the direct labor costs and with the “extra thousands” that GM will pick up post bankruptcy, they’ll be able to create more enticing products—a thousand dollars goes a long way in a mid-size sedan—and still make money. In theory.

In reality, GM’s success will depend upon how well the product planners can check the boxes on what the vehicles should and should not include, how well the designers can style products that people appreciate, how well engineering can pull everything together and how well purchasing and manufacturing can execute with all of the groups communicating to work out the bugs.

Even recently, GM has been successful at this balance. GM is a strong player in China and Latin America. Within North America, GM has maintained a strong reputation in the light truck / full size SUV market, a historically lucrative segment which will still accounts for more than 40% of GM’s sales in 2009. GM has winners with the Cadillac CTS, Buick LaCrosse and Chevy Malibu. GM needs to translate this success across their entire portfolio of cars and crossovers.

The upside of having 20% market share is that 80% of the people in America aren’t buying your products so they have growth potential. GM will never again have 60% of the US market like it did in the 1960s but if they maintain their focus, they can regain the “Mark of Excellence”.

[Bill Cooke has been an engineer and manager at Ford and Visteon.]



"...We can have a competitive cost structure, we can have a competitive capital structure, we can have the best discount rates but we need to have the best product." Sad how GM spent decades not believing this. We'll see if they're really interested in building great vehicles and not living in denial (relative to the competition) about what they make.


We're dealing with one of the oldest corporate cultures around. GM dismantles city mass-transit, EV1's, CARB, etc. and the 'new' version can't even keep a "global warming is a crock of s***" retired 77 year-old VP out of the gears.

$50 billion in loans is only the beginning of new losses.


With HCCI, GM is betting on the wrong horse. The time for HCCI came and went. They should have had it 10 years ago.

The fact that Bob "the Putz" is still at GM shows they still have their head up their tailpipe.


The last GM car I owned was a Cadillac Catera. It received warranty repairs every 6 weeks for over a 4 yr period.

The service people were very proud that they were fixing warranty items for me, and thought I should be elated I was getting all of this service for free.


I will not buy another GM car until I hear rave reviews about both the reliability and the value. I will let others be the guinea pigs.

In the mean time, I'll buy toyota and honda. This means my next buying opportunity for a GM car will be in ~10yrs. I hope they are still around by then.


I see the usual Blutz blather...the $5 or 6K "chemical factory" in diesels blah blah. Heres a thought...try running modern diesels on something better than ~40Cetane "tractor fuel". Then you can lower compression, which will lower the emissions and NVH. NO chemical factory reqd. Stop exporting diesel. Start making more high cetane diesel, like biodiesel. Stop making engines that are 2-3 times bigger than they need to be. Simple?

Will S

"Every vehicle that we are going to launch between here and 2014 is either going to be a car or a crossover. "

Sounds greenish, except;

1. They will continue to launch crossovers. If they were serious about mileage, they would stick to cars (and three wheeled vehicles, like the GM Lean Machine).

2. Sounds like they are coming out with a new round of SUVs/minivans/pickups after 2014, typical timing after the last recent round.

So this statement implies that business-as-usual thinking has not been sufficiently dispelled. Let's hope that implication is not realized.


GM's core problem is that their cars fall apart just as soon as the original owner has finished paying for them. That's due to actual engineering decisions (ABS modules that cost thousands and fail after 60 months) and to bean counting (replacement parts that are lower quality than what your car was fitted with at the factory).

I see nothing here that will change that. In fact, I'm scared of what they will come up with, given the fact that they don't even master their current technology. What is a HCCI ECU going to cost to replace?

Here is the story of GM since 1980, in a parable:
"Harry and Bob work at the same office. Bob buys an Accord, but Harry 'buys American' and gets a Malibu. Five years later, Harry is looking at his third brake job, $1000 to fix a front wheel bearing and his shop tells him the other one could go any time. His car is worth a ridiculously low price as a trade-in and drives like an old jalopy. Bob's Accord is still like-new and worth thousands more. Harry buys a Honda. Repeat until you've lost 75% of your market share, blame the unions."

Teeth whitening doesn't cure cancer, and marketing won't cure GM. It's as easy as that.



Thanks for reminding us of GM technology breakthroughs - planned obsolescence and maintenance.


Will - Remember, just because GM is owned by the government now doesn't mean that it doesn't have to compete in the marketplace. Crossovers are popular for a reason - they provide a lot of value to the consumer. Sure, GM could focus on traditional cars and tricycles, but at that point they would cease to be a competitive player in the market, and the government would either end up owning them in perpetuity as a jobs program, or would have to let them go under and see all that money pumped into them forever unrepaid.

It sounds as though they're trying to provide vehicles (cars, crossovers, and yes, trucks) the customer wants, and still improve mileage within those lines. If they can do that much while improving their quality, that's more than enough.


I wonder why they aren't trying to hire away great executives from Honda, Toyota, or other companies? Maybe they are, just not at the top, but sheesh, they need winning strategies.

Anybody think Fiat can make lightning strike twice in turning Chrysler around?


The fact that the whole lot of them wasn't fired (only Wagoner was) when the government took over was the sign to me that GM's future wasn't going to be too bright. I am predicting that the massive taxpayer bailout will be a huge waste of money, money thrown away towards fattening the belts of ancient dinosaurs like the Putzter (how can this guy still be working there?!?!?!?!? That's MY tax money that's paying his exhorbitant paycheck!!). Sorry, you're not going to be able to teach a 77 year old retired muscle car lunatic new tricks, no matter how you try to rebrand yourself. The management still stinks, because it's still the same management!!! Dough!!! I think Obama is a much better president than Bush was (he inherited an ugly economic mess), but I am dismayed at how willing he was to reward failure with billions of dollars.

Heck, you could take a random sampling of posters here and put them at the top of GM -- they'd probably do a better job of predicting what is a good vehicle to pursue than the current recycled circus troop is doing.

When GM can produce an EV to compete with the Leaf then they might have something to feel proud of. Oh, and when is the Volt actually going to come out now? Will it actually be 2012 when it finally hits the dealers? By then every other automaker will likely have their own EV out, for significantly less price than the Volt.


@Mark BC,

I am currently available for Mr. Lutz's 2008 six million dollar(USD) position and salary. Also, I promise not to publicly complain about hotels or lack of my own corporate jet.


PS - I will do my best to get by on $3,000 per hour.

Will S


Introducing new crossovers means that GM will continue to make the same mistake; not understanding the impending oil production peak, which will signal high oil prices again, which will make crossovers in worthless dealer lot ornaments (and customers will be frustrated in their attempts to unload them, as experienced by those during the $4/gal times last year).

Skeptical? Sure, you were skeptical before. Doubt there will be a supply crunch? Even the optimistic foresee supply crunches and peaks. The following is from the Chief Economist at the International Energy Agency;

Or see his interview, where he states that previous estimates of 3.7% annual declines in existing oil field production has been carefully analyzed to reveal a 6.7% decline rate;

"The IEA estimates that the decline in oil production in existing fields is now running at 6.7 per cent a year compared to the 3.7 per cent decline it had estimated in 2007, which it now acknowledges to be wrong.

...the IEA concluded that the global energy system was at a crossroads and that consumption of oil was "patently unsustainable", with expected demand far outstripping supply.

Oil production has already peaked in non-Opec countries and the era of cheap oil has come to an end, it warned.

In most fields, oil production has now peaked, which means that other sources of supply have to be found to meet existing demand.

Even if demand remained steady, the world would have to find the equivalent of four Saudi Arabias to maintain production, and six Saudi Arabias if it is to keep up with the expected increase in demand between now and 2030, Dr Birol said. "

If GM doesn't know this, then they are wearing blinders. If they do know it, then they are making the same shortsighted decisions that bankrupted them in the first place.

Your tireless cheerleading for GM is thinly-veiled...


Matthew may be cheerleading but too many nearsighted EV cheerleaders forget the Titan, Tundra, Armada, Sequoia, Genesis, etc.

They are a growing part of GMs woes.

You seem to think light duty trucks are less tha 5% of the market.

No Hybrids are less than 5% of the market. (per GCC; 2.3% of the market in Feb).

Light duty trucks are still nearer to 50% of the market.

This is not good news – but it’s reality, - links to it should not be so tenuous.

Will S

I hear your point, TT, though the point is not what market segments are shakily viable now, it's what will be viable 3+ years from now. If oil production capacity declines at 6.7% in existing fields and a new production crunch is looming in 2012 due to massive project cancellation, as the IEA has come to realize, then oil prices will rise over $100/bbl again and light trucks will become unsellable dealer lot ornaments. The recent past confirms this, though many of us with busy lives often have short memories.


Very true Will, but so many otherwise rational people believe, not just that High MPG cars will take over much of the US market in the next 3+ years, they seem to believe such cars took it over 3+ years ago.

This is astonishing.

They believe that, contrary to the evidence from the Insight 1 and the Prius, GM would be "on top" if they had persisted with the EV1.

Will S

Not sure of what you are referring to; GM clearly would not have lost so much market share if they had more fuel efficient models. Even Rick Waggoner admitted killing the EV-1 was his biggest mistake (they already had HEV and PHEV versions in pre-production test); given the oil production decline mentioned above, continuing to ignore the impending nature of peak oil will be at an automaker's mortal peril.


If they had more fuel efficient models of what?
GM clearly made big bucks on light duty trucks (still about 40% of the US market), NOT small fuel efficient models over he last 10 years -
Just as Asian auto companies then, and TODAY, make big bucks on small cars with ICEs,- NOT on hybrids or EVs, in the US market.

I think Rick Waggoner said something like it was a public relations blunder, while trying to get billions in bailout $$. Do you really believe GM wanted to NOT make money on the EV1, while the Corolla, Camry, Civic, Accord, Altima etc took over the US car market?

Again, how could an EV, 10 years ago, have made sense when one does not YET today? (and just MAYBE, finally, will make sense SOON - when gas goes back up).

Do you really think GM is getting well, with their “new” lineup?

They are STILL making the models they can make money on – they are NOT making/selling the models we wish they could make money on.

Do you really think they would be wealthier if they had left the big vehicle market to the Titan, Tundra, Armada and Sequoia - and made more Aleros?

Do you think the Volt will ever make significant money for GM?

Will S

Short term profits is what caused mid and long term problems at GM, and increased the US dependence on foreign oil.

What you think Rick Wagoner was thinking is irrelevant; he said it was his biggest mistake.

The market was crying for EVs last year, and there is still a demand. Wait until 2012 (or before) if the economy continues its recovery, and the demand will once again be sky high;

By 2012, surplus oil production capacity could entirely disappear, and as early as 2015, the shortfall in output could reach nearly 10 MBD...The implications for future conflict are ominous.
Joint Forces Command 2008

GM's 'new' lineup is still weak. US consumers in the 3rd quarter are moving away from light trucks and strongly towards cars;
WSJ Market Data Center.

The Volt is too expensive (even with $7500 in tax rebates) to have any impact on overall fleet fuel economy or GM sales. GM made a choice (40 miles on batteries) during the design to trumpet a discriminator, and that drove the cost up.

Truck sales are heavily discounted now to get them off the lots, and the margins the automakers once enjoyed with them are now gone.


Why do you say short term profits is what caused mid and long term problems at GM?
Wishful thinking.

They are still making large vehicles and dumping Saturn.
It is simple - They do not make what we wish they could sell.

What Rick Wagoner was thinking may be irrelevant; what he said may be also.

To think the market was crying for EVs last year, makes no sense; the Prius has been on the market for 10 years. If there is some sudden desperate demand just now, how could GM have foreseen it (Toyota apparently did not). But there is no such spike.

Wait until 2012; if the economy continues its recovery, yes, the demand will start to rise once again and sales will exceed 3.07% (Reported Sales of US Hybrids Up 48.6% in August; 3.07% Market Share - 2 September 2009 - GCC). That's for ALL hybrids; 3.07%.
That is NOT Sky high.

After 10 years is there still a shortage? It is not obvious;. And if there is, why ? Because there is no EV1 nor Insight 1? Laughable.

Of course the Volt is too expensive (even with $7500 in tax rebates) to have any impact on overall fleet fuel economy or GM sales. GM knows this, and production is starting slowly - so it cannot possibly affect market share.
Is this the best GM can do – obviously yes.
Has anyone in the world done better?
No not yet. Will they ? Probably.

And if GM had continued with the outdated EV1, they would be ahead of Prius ?
But even if so, what ? –they would now outsell Prius (fat chance) and now have what ?
3.08% of the market? WOW. OK, maybe glory? No, not from a more expensive Prius; the Volt will bring all the glory they can get.

GM made a smart choice (Volt; 40 miles on batteries) during the design to trumpet a discriminator, and not try to compete head on with the Prius (which sells only PART of the “3.07%” that hybrids enjoy).
Prius sells because it is green. Volt will sell (some) because it is greener. Neither will sell big, at this time, because they do not make economic sense for the buyer.

Of course truck sales were heavily discounted to get them off the lots, and the margins the US automakers once enjoyed with them are now gone and the Asian trucks are here in force.
And small American cars like the Alero do not sell.
What’s the answer ?
Make the EV1 ? - No way.

It's simple. GM does not make car we wish they could sell.
And they won’t.
And they should not.
They build what they think will sell best - anything else is likely to hasten their decline.

Will S

"To think the market was crying for EVs last year, makes no sense;"

We'll simply have to disagree on this one.

"how could GM have foreseen it"

By listening to petrogeologists.

"Is this the best GM can do – obviously yes."

A sad statement...

"Has anyone in the world done better?
No not yet. Will they ? Probably."

Considering the Volt is not yet out, all the other cars in the pipeline have the same footing. And many, many cars do far better at reduced energy consumption than the Volt for much less.

GM's projections and choices for "the market" resulted in massive losses of market share for them. I don't see how you could honestly paint this picture any other way.

No idea how people with engineering backgrounds can be so obtuse. Higher MPG targets are a waste of time and R&D $$.

Just need to develop a B100 compliant engine that passes the emission tests and GM would have a bright future. We and nearly 100 other companies are planting 2nd generation feedstock for about 1,000/gallons/acre/year yield. Our target is 24B gallons/year which can eliminate all OPEC nation petroleum purchases.

When the fuel is sustainable, economical ($38 barrel equiv.) and environmentally friendly, MPG doesn't mean much. Actually, lower MPG is desirable.

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