Episode 424 – General Motors Is Upbeat, Solar Powered Race Car, Sticker Shock

June 30th, 2010 at 12:00pm

Runtime 8:40

General Motors met with Wall Street investors and analysts yesterday and delivered a generally upbeat message about the company. The University of Michigan won its third-straight American Solar Challenge race. Audi plans to sell imported R8s with the 5.2-liter V-10 in China for $342,000. All that and more, plus a look at an iPhone app smart developed for the electric version of its fortwo.

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Transcript and Story Links after the jump . . .

It’s Wednesday, June 30, 2010 and here’s the news.

GM IS UPBEAT
General Motors met with Wall Street investors and analysts yesterday and delivered a generally upbeat message about the company. Two key facts that emerged: the Wall Street Journal reports the company is operating at 85 percent production capacity, which is comfortably above its break-even level. And Bloomberg reports GM is getting $3,000 more on average for every vehicle it sells in North America.

NO OVER-PRODUCTION
Here’s my Autoline Insight. By closing so many plants when going through bankruptcy, GM can now operate the remaining ones at high capacity-utilization, which is the key way to make money in the automotive business. The old GM had so many plants, and a UAW contract that essentially prohibited it from laying off any workers, that it was actually cheaper to build cars than not to build them. So the company built way too many vehicles and then had to offer massive sales incentives to entice people to buy them. The new GM is building vehicles to match customer demand, so it doesn’t need as many incentives. That’s why it’s getting more money per vehicle, and as it continues to replace older models with better ones, it should get even more money for every one it sells.

CHEVY COLORADO STRONG IN ASIA
The Chevrolet Colorado midsize pickup truck has been kind of disappointing from a sales standpoint in the American market. But guess what, it’s doing great elsewhere in the world. Bloomberg reports that GM will build a new version of the Colorado in Thailand for export to Europe and Southeast Asia. The company expects to sell around 100,000 copies of the Chevy – sorry, Chevrolet-branded pickup per year in these markets. The move is part of a nearly $470 million investment in the country. GM also plans to build a diesel-engine plant there.

CHINA #2 FOR PORSCHE
Just to show you how much the world is changing, China will become the second-largest market for Porsche in the world, behind the United States. According to Gasgoo, the company is aiming for sales of 16,000 units a year by 2012 which would be enough to overtake Germany for second. Last year the company sold 8,600 vehicles with the Cayenne accounting for over 80 percent of those sales. In order to reach its goals, Porsche plans to add 13 more dealers this year in China to the 25 it already has.

STICKER SHOCK
And speaking of German luxury makers in China, Gasgoo reports, that Audi plans to sell imported R8s with the 5.2 liter V-10 in the country for, brace yourselves, $342,000. A lot of that has to do with taxes, but it’s about $200,000 more than the car costs in the American market. Audi is the largest luxury brand in China and expects to sell 200,000 vehicles there this year.

SOLAR-POWERED RACECAR (subscription required)
Ward’s reports that the solar-vehicle team at the University of Michigan has won its third-straight American Solar Challenge race. The group’s Infinium car, which is its 10th-generation vehicle, can hit speeds of 100 miles an hour! It crossed the finish line two hours ahead of its closest competitor clocking in with an elapsed time of 28 hours, 14 minutes and 44 seconds to complete the 1,100 mile – 1,700 kilometer – race. This is the school’s sixth victory in the contest. It won the inaugural event back in 1990.

Apps for smart phones are a booming business these days. And there are tons of apps for cars. We’ll take a look at how smart is integrating smart phones into its cars, right after this.

Smart is coming out with an electric version of its dinky little fortwo. And to keep customers on the bleeding edge of technology, it’s developing a number of apps so that you can use your smart phone in your smart. Check this out.

Let’s see if apps like this do anything to helps sales of smarts, which are pretty much going nowhere these days.

Don’t forget to tune in to Autoline After Hours tomorrow night, LIVE, when we’re devoting the entire show to your questions and comments. That’s right, an entire show dedicated to Rapid Fire, which gets us into all kinds of topics. So bring ‘em on! Get your questions in for Autoline After Hours tomorrow night starting live at 7:00 p.m. Eastern Time.

And that’s it for the most interesting news in today’s global automotive industry. Thanks for watching, we’ll see you tomorrow.

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51 Comments to “Episode 424 – General Motors Is Upbeat, Solar Powered Race Car, Sticker Shock”

  1. Tony Gray Says:

    Actually a pretty neat app there for the iPhone. Now I want one for my Bimmer that gives me a Push to Pass feature, the ability to change traffic lights at will, a cancel button to turn off eternal turn signals on Buicks driven by men with hats, and a tractor beam to shove folks out of my way.

  2. G.A.Branigan Says:

    The chevy Colorado didn’t do well here in the USA because it was/is chevies biggest POS!!! I bought a new one in 07 and never in my life did I have more problems with any 10 vehicles.Anti-lock (abs) motor would stay on after you shut down,lock the doors and go in the house….result?Locked up brakes and being DRAGGED onto a roll-back and taken to the dealer for repairs.Then there was the 4wd engaging while doing 65mph on the hwy….whenever it felt like it,and it was often.Oh yeah,I forgot to mention the constant dead battery from the abs pump.THEN there was the rain,and here in southern Oregon it rains constantly in the winter,which resulted in STANDING WATER in the truck:result?Moldy carpet.The single worst POS I have ever owned.Then of course was the 30k mile mandatory head problems with the eco-tech 4 and 5 cyl engines.WOW.

  3. Tom Martin Says:

    I have a Chrysler 300M with factory navigation. However, I mounted my Droid on the dash and use it for navigation. I love using verbal commands, e.g. Navigate to Macy’s at Fair Oaks Mall, and having traffic information.

    I never plan to buy another factory navigation system, unless the price drops below $500 and it has voice commands with traffic that does not cost extra. Fat chance.

    By the way, the iPhone mapping app was kid’s play in comparison to the standard mapping/navigation app on my Droid. But it’s better than nothing at all.

  4. pedro fernandez Says:

    GA either you were very unlucky with your Colorado, or a friend of mine is very lucky with his. He’s reportedly had no major issues at all and not only he drives a lot for his job, but he has a weekend home about 2 hours away from here and he travels back and forth every week, whenever I speak to him I ask him about it, keeping in mind the problems you’ve had and it’s always,”great truck, no problems” Go figure, and they do have a dismal repair record and it’s considered one of the most troublesome vehicles being sold today. By the way, that Smart app is a very good idea in that it makes you forget that you’re driving a world-class POS.

  5. diffrunt Says:

    Re: Colorado—musta been built hangover monday or hurry up friday

  6. Jim Thykeson Says:

    Go Big Blue!! American ingenunity at it’s best! A 100MPH solar-car! Are you kidding!! These kids do Michigan proud! Best in world! GM, Ford, get these home-grown genius’s. How proud that story made me feel!

  7. pedro fernandez Says:

    The tag line for that flying car should read: “(engine) failure is NOT an option” Do you suppose they’ll sell 5 of them?

  8. Chuck Grenci Says:

    Colorado, good/bad; I don’t know, but ugly in my opinion (way too busy in the front facade and notchy in the side/rear). I’ve been a Chevy fan my whole life and think they just dropped the design-ball on this one; time for a new midsize Chevy pickup IMO.

    There was a slight mention (that you shouldn’t do some of the ‘droid-aps’ while driving) but you know people will; I just hate all this new sh…..stuff and wish when people got behind the wheel they would DRIVE.

  9. Mohammad Rafi Says:

    Pedro,
    I couldn’t agree more with you that the smart (as the company likes to spell it) really is a world-class POS. That car has no right to exist as it it small, ugly, overpriced, with poor performance, and gets one of the worst gas mileage ratings of any small car (for its size). I can’t help but laugh every time I see an idiot driving one.

  10. Kit Gerhart Says:

    Smart is an acronym, actually a bastardized acronym for “Swatch Mercedes Art.”

  11. Kit Gerhart Says:

    For what it’s worth, the Colorado/Canyon is/are Consumer Reports’ second least favorite smallish pickup. Only the very old design Ranger ranks lower in their tests. The Canyon is one of few cases where the model it replaced, S-10, may have been better than the replacement.

  12. Gary Paul Says:

    hi John…
    #1. I have been in favor of reducing redundant extraneous vehicle divisions at GM and Ford for years and I am glad to see Pontiac, Saturn, Land Rover, Mercury, Plymouth, etc., become sold or eliminated as they had no solid reasons for existing within the company and absorbed considerable resources to maintain.

    At the new Chrysler, there is an effort underway, to reshape the image of Dodge cars and crossovers into a more modern, cutting-edge, lean (efficient), youthful, refined vogue that will separate it from the more blue collar macho image of the RAM truck line. Do you & your experts consider this wise? If there is a legitimate concern with the image of RAM trucks sending the “wrong” message to customers who are seeking cars and crossovers under the Dodge umbrella, how would you deal with this, since RAMs are still sold through Dodge Dealers? Does Chevrolet have the same concern with the Chevy Silverado trucks versus Chevrolet Cars and crossovers?

    #2: Ford has encouraged Lincoln Dealers to hook up with Ford Dealers (if not already) especially with the demise of Mercury near. Is there a concern here with Lincoln becoming too closely associated with Ford vehicles, just as Lincoln tries to emerge as a truly premier & distinguish luxury leader?

  13. pedro fernandez Says:

    Kit: as old as the Ranger design is, I believe it’s got a better reliability record than the GM twins, Am I correct on this? It does need a complete make over but I just hope they don’t make it too big and they need to simplify the model line up and option list, it is so convoluted that if I were buying one, I’d be pulling the few hairs I have left.

  14. Kit Gerhart Says:

    “Winding Road” has an article on the electric smart at:
    http://www.windingroad.com/articles/reviews/driven-2011-smart-fortwo-electric-drive/?src=Nextscreen

    Whatever you think of electric cars, or smart, the electrification would improve the driving experience a hundred fold, for a simple reason. A smart is a pleasant enough driving car, except for the wretched transmission. In the electric, the transmission is gone.

  15. pedro fernandez Says:

    Kit: did you check out the price of this thing? It just doesn’t make sense. If you live in an area where an EV would be practical as an about town car (ex. Key Biscayne, Fl)you can get an extended golf car for a hell of a lot less money and have another car for when you need to go to the mainland. There’s a dealer in town selling a Chrysler-built EV for a lot less $ than a conventional EV

  16. Kit Gerhart Says:

    pedro fernandez Says:
    June 30th, 2010 at 5:21 pm

    “Kit: as old as the Ranger design is, I believe it’s got a better reliability record than the GM twins, Am I correct on this?”

    Yes, according to CR’s surveys. The Ranger is “average” reliability overall, and the GM twins “much worse than average.”

    The main thing the Ranger is lacking is refinement, which is expected in a, what, 15 year old design. I hope that when and if Ford comes up with a new Ranger, they will keep it about the same size, rather than “growing” it like most of the others. A “small” Nissan Frontier weighs over 4600 pounds. That’s the crew cab, but a regular cab version probably weighs over 4000.

  17. Gary Paul Says:

    The Rangers are well liked and reliable little trucks IF they are in the 4 cylinder, manual transmission, 2wd versions—especially with the long-bed short cab layout which maximizes useful space in the bed and reduces cost and weight (unfortunately long bed, 4-cylinder eliminated by Ford for 1998 and brought back briefly in 2007-08). I have owned 5 Rangers like this. The vehicles get decent mpg and plenty of contractors use them for light work with 200-300 thousand miles on them. Inexpensive to maintain too. Especially were rugged with the twin I-beam front end (killed for 98), and roller steering (not the rack and pinion introduced in 98 also). The 4wd and V6s have had less dependability and more problems, generally.

  18. Kit Gerhart Says:

    pedro fernandez Says:
    June 30th, 2010 at 5:33 pm

    “Kit: did you check out the price of this thing? It just doesn’t make sense.”

    I completely agree. Pure electric cars don’t make sense, and never will, unless the REAL price comes down a lot. Even then, they will only make sense for fleets in cities, or as a third or fourth car for local commuting.
    To me, it is crazy having these tax subsidies for electric cars.

  19. tj Martin Says:

    The ( not so ) Smart ;

    For about ten seconds I had considered waiting till they had been released in the US before buying my Mini .

    After sifting thru all the UK EU automotive magazines for Test Reviews etc. it dawned upon me that ;

    A) The Mini Cooper gets equal or better MPG
    B) I could put much more than myself , the wife and a bag of groceries in the Mini . Not so the Smart
    C) The Mini far and away is a much more versatile car than the Smart as the Smart is a nightmare at highway speeds whereas the Mini just thrives at any speed , is fantastic around the city and is a hoot to park
    D) The Mini does take up a bit more space and costs a bit more but look how much more you get
    E) You don’t look like a Greenie Tree Hugging Fool in the Mini .
    F) The Mini has a substantially better reliability record worldwide
    G) Not buying a Smart meant not dealing with the Attitude of the Mercedes Dealer it was attached to .

    Etc. Etc. Etc.

    In conclusion . Electric . Gasoline . Diesel . What’s so SMART about buying a Smart if you’ve done your homework .

    Which as we all know most folks do not .

    Kit G.— I’m not sure anything could improve the driving experience of the Smart . Try taking one over 50 MPH in a slight breeze ( 5-15 MPH ) sometime .

  20. pedro fernandez Says:

    Kit: absolutely agree with you that manufacturers just keep making the updated models larger and more expensive. The current Tacoma is as large as the old “full size” Tundra. Whomever comes here with a true compact, sturdy 4cyl or diesel pickup is gonna do very well, IMHO.

  21. Gary Paul Says:

    Yes I like the small size of the Ranger, yet it may grow a little on the next US version as we would get a world truck that is used as a “full size” in Asia etc. If it can tow like heck (4000 pounds or more in the wimpiest 2wd version), has improved mileage (maybe with a rugged diesel hitting 29+ mpg highway) and has neat real truck features, like solid frame, sturdy solid rear axle, and tough steering, & can take lots of punishment, bring it on. Oh yeah and I know lots of people want MAGIC and an endlessly large interior so it is both small and large at the same time… but please give us a LONG BED short cab for real men and real work please… You want a big interior and 4 doors and bringing the kids along—get a sport ute!!

  22. pedro fernandez Says:

    tj: my local supermarket has a truck-like shopping cart for kiddies to ride on and I purposely placed one next to a smart and the cart was as long as the “dumb”.

  23. Kit Gerhart Says:

    tj Martin Says:
    June 30th, 2010 at 5:47 pm

    “Kit G.— I’m not sure anything could improve the driving experience of the Smart . Try taking one over 50 MPH in a slight breeze ( 5-15 MPH ) sometime”

    I’ll have to do that sometime, if I get the opportunity. I’ve only driven one a couple times, and not on the highway when it was windy.

    It might bring back memories of the VW Beetle I had when in Scotland in the Navy. It was often windy there, and that Beetle really let me know it was windy.

  24. tj Martin Says:

    Pedro Fernandez

    I know the /shopping cart you speak of and you’re right . In fact I’m surprised the Shopping Cart wasn’t bigger .

    Don’t get me wrong I can live with small . Fact is we all need to downsize a bit . But small that works please . Not Small for the sake of being Small .

    It probably won’t make it to the US but I’ve been following the progress of Gordon Murray’s new city car the T25 .
    Considering Mr. Murray’s past CV it would be a good bet this may be a Micro Car that does work .

  25. pedro fernandez Says:

    Looks like the Dumb is gonna have a competitor, just read it on the Road and Track website, it’s gonna be called the T.25 city car with a tiny 3 cyl engine also. I guess that now we can call them Dumb and Dumber and Tesla shares are exploding, I guess Barnum was right after all.

  26. tj Martin Says:

    Kit G.

    Like I said just a mellow breeze at 50 MPH (You don’t need a wind to upset the Smart over 45MPH ) I promise it will make your VW Beetle experience ( the original which I assume you’re talking about ) seem down right stable and safe .

  27. tj Martin Says:

    Pedro Fernadez

    I wouldn’t place any bets against the works of Gordon Murray . Like I said his CV is beyond impressive . The McLaren F1 road car . Ariel Atom . The insane Caparo ( he sorted that out for the company )

    GM knows cars , performance and the joy of driving . So maybe the T25 won’t live up to my expectations but it would be a bit foolish to bet against Murray . Brilliant doesn’t do him justice !

  28. pedro fernandez Says:

    This T25 is a foot shorter than the Smart, WOW talk about claustrophobia, no thanks, I’ll take a used Civic or Corolla, thank you!

  29. tj Martin Says:

    Pedro

    So maybe Dumb and Damn it Works ! ( the Smart and the T25)

  30. tj Martin Says:

    Considering Gordon Murray’s height etc. I rather doubt it will feel claustrophobic Pedro .

  31. pedro fernandez Says:

    tj but the Smart has run out of steam in sales, how is an even smaller car gonna make any waves?, unless gas goes up to $5 a gallon. And then the economy is gonna tank even further and no one will be buying nothing!

  32. pedro fernandez Says:

    tj please read the article at Road and Track online and you will see it’s not the most handsome design around.

  33. tj Martin Says:

    Pedro ;

    I was wondering when someone would bring up the Tesla share issue . The really stupid thing about their rising is every and I do mean every Financial Pundit is recommending DO NOT BUY on the Tesla IPO . Every one of them .

    When you look at the companies books you ask yourself ” What the Cuss is wrong with these idiots tossing their money at this mess ? ”

    Add to the fact that Tesla is being run by a One Time One Hit Internet Wonder who has never MANUFACTURED anything in his entire life .

    Along with the reality that the only thing keeping Telsa solvent right now in light of their horrendous losses is … You guessed it . the Tax Payers money we just handed the company . Oh and the investment Toyota just made .

    A Fool and His Money are Soon Parted seems to weak in this scenario

  34. tj Martin Says:

    Pedro ;

    Head over to evo.co.uk for some better photos and a more in depth review of the T25 .

    Yes its a bit different looking but in comparison to the Smart or worse yet the Tata Nano its a bloody Ferrari .

    Like I said maybe it won’t live up to my expectations . It will take the road tests etc. to prove the T25 out . But I’d still place my bets on anything Murray had his hand in to do what he says it will do .

    Time will tell

  35. pedro fernandez Says:

    tj as if this car didn’t have enough going against it, it will be built in the UK, where reliability is a 4 letter word. It may do well in the UK where spaces are real tight, but here, I’m not so sure. re: Tesla, I guess they figure that the feds are gonna be throwing money at it to keep it going so EV’s can get going, but I know that the more govt gets involved, the more people are gonna reject the whole EV thing.

  36. Kit Gerhart Says:

    tj Martin Says:
    June 30th, 2010 at 6:02 pm

    “Like I said just a mellow breeze at 50 MPH (You don’t need a wind to upset the Smart over 45MPH ) I promise it will make your VW Beetle experience ( the original which I assume you’re talking about ) seem down right stable and safe .”

    My Beetle was a 1970 of the air cooled variety.

  37. Kit Gerhart Says:

    pedro fernandez Says:
    June 30th, 2010 at 6:09 pm

    “but the Smart has run out of steam in sales, how is an even smaller car gonna make any waves?, unless gas goes up to $5 a gallon. And then the economy is gonna tank even further and no one will be buying nothing!”

    Expensive gas would certainly increase sales of micro cars, but also, they need to drive well. The transmission of the smart is awful, and as I just learned from tj, it also blows around too much in the wind. A smart would serve the purposes I use my Mini for, but it doesn’t drive well, and gets only 10-15% better gas mileage than my manual transmission Mini. As tj says, the Mini is a “do everything” car, as long as you don’t need too much space. To me, the only thing that keeps my Mini from being an excellent road car is that it is kind of noisy. If there were a micro car that drove as well as a Mini and got 50% better gas mileage, I’d consider it. It wouldn’t be as crashworthy as the MIni, but then, I ride motorcycles, and a micro car would be safe compared to a two wheeler.

  38. pedro fernandez Says:

    Kit: would it be worth it to add some sound insulation to your mini, like under the carpet and inside the door panels. Even under the headliner.

  39. XA351GT Says:

    My problem is why buy a Smart with mid 30 MPG when I can buy a bigger more usable car with similar gas mileage . There is zero crush zones in the car which means all the energy of a crash will be transmitted directly to the passengers. No thanks . it’s not much more than a golf cart on steroids.

  40. Kit Gerhart Says:

    pedro fernandez Says:
    June 30th, 2010 at 7:56 pm

    “Kit: would it be worth it to add some sound insulation to your mini, like under the carpet and inside the door panels. Even under the headliner.”

    I’ve heard mixed reviews on adding sound insulation. The place I’ve heard that it can be most effective, including on Minis, is the wheel wells.

    I suspect what might be the easiest, and maybe the cheapest way to quiet my car down a little is to replace the run-flat tires with regular tires with sidewalls that are less stiff.

    In the end, I probably won’t do anything, since I normally use my Malibu for “road trips,” but when I need tires, or maybe before the present ones are completely worn out, I’ll get rid of the run-flats.

  41. HtG Says:

    OK, here’s my two cents on Smart. In a place like NYC I see them parked in the odd bits of space near the corners where normal cars can’t fit. I guess in cities these things make some sense.

    But today I saw one on the highway going at least seventy. I will admit to having watched it for signs of imminent flippage.

    Also, if I might use a word I recently learned, I think the name SMART is not properly called an acronym, but rather it is a portmanteau, a word made of different words. “Swatch Mercedes Art”>>>SMART.

    No one needs to remember this.

  42. Kit Gerhart Says:

    HtG Says:
    June 30th, 2010 at 10:15 pm

    “Also, if I might use a word I recently learned, I think the name SMART is not properly called an acronym, but rather it is a portmanteau, a word made of different words. “Swatch Mercedes Art”>>>SMART.”

    I called SMART from “Swatch Mercedes Art” a bastardized acronym, but it sounds like you have the proper term. I’ll have to remember “portmanteau.”

  43. Mouhamad A. Naboulsi Says:

    Smart is not. Not the car and not the Apps.

    Are you guys living in a cave up in the Swiss Alps? Have you heard of Man Machine Interface?, Driver Distraction?, Product Liability?

    What works on a phone does not work in a car. A phone can never replace what goes into the car, even if the design of the car is inferior.

    I wish Secretary Lahood watch this so something is done about these rogue programmers.

  44. HyundaiSmoke Says:

    The Dumb Car could have been smarter if only it was a $7500 Car.

    $11K for a car the size of a Lawn Mower, with a POS Powertrain that for its size got 2 MPG (It might as well) LMAO!!! What a joke!!!

    Its too small to be nothing more than a sub $10K car. Who in the hell do these guys think they are to be able to justify such a price premium on a Golf Cart that’s totally unacceptable for US Highway standards?

  45. HyundaiSmoke Says:

    The Dumb Idea is actually a SMART Idea with totally piss poor execution.

    They so screwed that car up.

  46. Nick Stevens Says:

    Seems there is wide agreement today on all important issues. The guy who designed the “Dumb” as well as the Swatch, Nicholas Hayek, died yesterday at 82. I posted the link to his NY Times obit, and he was praised for saving the swiss watch industry with the SWATCH, but not one word in the whole thing about that dismal failure, the “Dumb”. Must have been written by a good friend of his.

  47. Nick Stevens Says:

    http://automobiles.honda.com/mile-makers/story.aspx?Story=961

    So, another Honda with over 400,000 miles. What is the big deal? This one is the 70 MPG Insight HYbrid, the US Hybrid Pioneer 2-seater. The owner is determined to drive it until it (or he!) dies, and has bought some extra parts already!

  48. Nick Stevens Says:

    http://automobiles.honda.com/mile-makers/story.aspx?Story=957

    The above 400k miler stole the show from this very competent Civic Hybrid which already has 275k miles!

    So much about worrying about the hybrid batteries etc!

  49. pedro fernandez Says:

    Nick: these cars with original clutches must be living out in the country where there’s little traffic and looong stretches of road w/o having to stop, no way that a city car or a heavily populated suburban car can have a clutch last so long. The Insight guy actually replaced the battery at 400,000 miles. That’s quite a gamble.

  50. Nick Stevens Says:

    My usual driving style whenever I had manuals would be to drive 2 miles each way or less on weekdays, and I did 137k miles on Honda Clutches on the Accord and the original clutch worked just fine. The 137 is like 10 times that if I drove 40 instead of 4 miles a day. That explains the ccords with over a million miles..

  51. Nick Stevens Says:

    400k miles to replace the battery seems excellent durability for the battery and implies that the rest of the car is like new, or the owner is so attached to it that he wants to drive it until he drops dead. I met the first Honda Insight original owner (and drove it for a few miles, got 66 MPG) andhe had a similar attitude towards his car.