Sunday, October 10, 2010

The Sunday Paper: October 10, 2010

Much better looking than the Leaf, don't you think?

Here comes the Volt! Get ready for a ton of press on GM's baby this week, as the company has flown in journalists and industry experts and buyers galore for a "coming out" party to celebrate the car's arrival at dealerships, expected within the next few weeks. In honor of that, I'm going to devote this week's roundup to car news...

  • The Freep reports that GM is using this rollout as a way to promote shares of its anticipated November IPO. Innovation! Cutting edge! Green! That sort of stuff. GM mentions the Volt 22 times in its IPO registration; the plan is to use the car to show that GM has what it takes to be an industry leader such as Toyota did with the Prius long ago - and therefore help build a brand reputation that will sell its other models as well.

  • "Conservatives" are throwing a fit about the incentives for electric vehicles, but as the NY Times points out, the initial higher price of these cars is due to the batteries - and that cost is predicted to drop by as much as 60% in the next few years as technology improves and mass production comes on line. Eventually these incentives will be weaned away as production costs align with traditional car prices. Toyota lost money on the Prius for the first few years, but when gas prices rose - they made a killing. Same applies here. And with nearly every major auto manufacturer (not to mention the Chinese) getting into this game - it sure is nice to be in front of the parade for a change.

  • All those electric models are going to need batteries, so for all the hand-wringers that are worried about over-capacity for production here in Michigan - don't sweat it. At the A123 grand opening a few weeks back, VP Jason Forcier tells us their capacity is sold-out "through the end of next year", and they are expanding as customer demand grows. Not only are they working contracts for the Big Three light autos, they are producing for heavy truck and bus systems as well. Fleet sales are guaranteed for volume...

  • ... and fleet sales will lead the way. Delivery trucks, shuttle buses, postal routes, etc., generally have a set amount of miles they drive in a day, and that makes them perfect for electric vehicles. Companies like Azure Dynamics in Oak Park and Daimler Buses North America are building the drive trains and other components, concentrating on fleet sales to both government and private couriers looking for long-term fuel savings. They describe business as "booming".

  • The electric Ford Transit Connect is one such fleet vehicle, and the federal GSA has ordered 100 of them to start, with plans to study how they can put them to best use. The GSA oversees a fleet 650,000 federal vehicles - and that could spell big orders in the future. Ford currently assembles the bodies in Kocaeli, Turkey (oddly enough) - let's see what we can do to bring them home.

  • Fleet sales won't be the only thing driving the market; those crazy kids out in California are calling for one million electric vehicles on their roads by 2020, hoping to reduce greenhouse gas emissions. And, even though the knuckle-dragging troglodytes at the DNews are now whining about increased mpg regulations (seriously Nolan, go Galt already, would you?), scientists believe that hitting a 60 mpg standard by 2025 could be possible with advancing hybrid/electric technology and improved body design.

  • If you build it, they will come. Some really great domestic car sales news today - American automakers are regaining share of the market, reversing the slide that started in the mid-90's. In 1995, domestics held a 73.1 percent share. And if you ever wondered where those Michigan jobs went, nothing illustrates it better than the numbers now...

    Overall, the U.S. automakers’ combined share of the American light vehicle market has risen to 45.1 percent from 43.9 percent, while the combined share of the Asian brands slipped to 46.4 percent from 47.8 percent, according to Autodata Corp. The European brands’ share is essentially flat, at 8.4 percent this year from 8.3 percent in 2009.

    Ford is leading the way, gaining 1.5 points this year alone to land at a 16.7 share. Chrysler is riding the strength of the new Jeep Cherokee, up .3 for a 9.5 share. GM has slipped a bit, from 19.6 to 19, due to losing four brands - but look for them to start regaining as well, depending on the success of new models like the Volt and Cruze.

    We're coming back, baby. Now, if we can keep the Republicans from throwing the car into reverse and blowing our transmission (ha ha) - we are well on the way to not only the creation of a bunch of jobs right here in Michigan, but decreasing our nation's dependence on foreign oil. Win win.

    Vote accordingly.