Episode 545 – Toyota Fined, Again; 2011 Chrysler 300 Revealed; More Ethanol Drama

December 21st, 2010 at 12:00pm

Runtime 7:50

The U.S. federal government socked Toyota with another fine, this time for its tardy handling of recalls and other safety issues.  Chrysler just released pictures of its redesigned 300, which should start arriving at dealerships in the first quarter of next year.  The Alliance of Automobile Manufacturers is one of four trade groups that’s asking a federal appeals court to overturn a ruling by the U.S. EPA that allows gasoline blends with 15 percent ethanol.  All that and more, plus John shares some of his thoughts on the Ford Focus RS 500 he recently drove.

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This is Autoline Daily for December 21, 2010. And now, the news.

ANOTHER DAY, ANOTHER FINE
Toyota was hit with another fine in the U.S. in regards to its tardy handling of recalls over safety issues. According to the AP, the company will pay $32.4 million to the U.S. government, that’s in addition to a $16.4 million fine the company paid earlier in the year in a related investigation. The penalty settles investigations over how the company handled recalls over sticky accelerator pedals and steering relay rods that could break. Even though Toyota agreed to pay the fine the company doesn’t admit it violated any U.S. laws.

2011 CHRYSLER 300 REVEALED
A couple months back Dodge revealed its overhauled 2011 Charger, and now it’s Chrysler’s turn.   It just released shots of its redesigned 300.  In keeping with some of its other recent updates, this rear-wheel-drive, four-door gets new bodywork, but the silhouette still looks pretty similar to today’s version.  The front end gets a redesigned grille with wispy horizontal chrome bars, while the daytime-running lights are comprised of a string of LEDs.  The windshield has been raked back three inches, which actually requires quite a significant sheetmetal change. But the interior is where Chrysler really went to town.  Everything looks elegant, soft and luxurious.  The gauges and other controls light up with sapphire-blue illumination, while the center stack is dominated by a huge 8.4-inch navigation screen with the company’s Uconnect Touch infotainment system.  Expect it to be powered by either a HEMI V-8 or the brand-new Pentastar V-6.  Look for the 2011 Chrysler 300 at dealerships the first quarter of next year.

THE RED PILL OR THE BLUE PILL?
GM’s Cadillac division is getting a new voice.  Award-winning actor Laurence Fishburne will lend his mellifluous tones to the brand’s upcoming television advertising.  The campaign will launch during the Rose Bowl game that will be telecast on New Year’s day.

SUNNY DAYS IN CHINA
Is this a sneak peek at the next Sentra? Nissan unveiled an all-new global sedan, called the Sunny, at the auto show in Guangzhou, China. The vehicle will first go on sale in China next year and then will be shipped worldwide. The model will probably replace the Sentra in the U.S. It comes equipped with a 1.5-liter four-cylinder engine that’s mated to its next-generation Xtronic CVT. The Chinese version has a starting price of $12,400.

MORE ETHANOL DRAMA
Four automotive trade groups are asking a federal appeals court to overturn a ruling by the U.S. EPA that allows gasoline blends with 15 percent ethanol, or what they call E-15. The Alliance of Automobile Manufacturers is part of the challenge, Bloomberg reports. I find that interesting because GM, Ford and Chrysler are part of that group, and they’ve been the biggest proponents of Flex-fuel vehicles that can run on E-85. They also make vehicles for sale in Brazil that can run on anything from E-22 to E-100. So why are the Detroit Three all of a sudden against E-15? Here’s my Autoline Insight. They get very generous credits that apply to the Corporate Average Fuel Economy standards for every flex-fuel vehicle that they make. But if all of a sudden ethanol starts showing up in higher concentrations in all gasoline, like it would with E-15, they could be in danger of seeing those flex-fuel credits go away. I don’t know how the Detroit Three can say with a straight face that E-15 could damage their engines.

IS CARB TOO FAR AHEAD? (subscription required)
Interesting article from Ward’s. It reports that automakers worry that California’s strict emissions regulations may be getting out way in front of what customers will really buy. For example, the California Air Resources Board is pushing to get 1 million plug-in electric cars on the state’s roads in the next nine years. But it took Toyota 12 years to sell 1 million Priuses all around the world. It quotes the California New Car Dealers Association as saying they don’t want to see a bunch of green cars just sitting on their lots because not enough people want to buy them.

MORE DISTRACTIONS, FEWER ACCIDENTS
And speaking of government and regulations, the Secretary of the Transportation Department, Ray LaHood wants to ban truck and bus drivers from using cell phones while driving. Reuters reports this would affect 4 million drivers who are already banned from texting while driving. It’s an effort by the secretary to reduce accidents caused by distracted driving. And yet, traffic accidents and fatalities in the U.S. are at a historic low. They’ve dropped dramatically. In fact, you could argue that, statistically, the more that electronic gizmos show up in cars, the lower the accident rate has become. I wouldn’t make that argument, but you could do it.

Coming up next, a look at the highest-performance car Ford sells in Europe, the Focus Rallye Sport.

FORD FOCUS RS500
Ford makes a fantastic version of the Focus in Europe known as the RS, which stands for Rally Sport. Here’s what I thought about the car.

I promise you that we’ll have full driving impressions of the Focus RS in an upcoming edition of Autoline Daily.

And that brings us to the end of today’s report on the top news in the global automotive industry. Thanks for watching, we’ll see you tomorrow.

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31 Comments to “Episode 545 – Toyota Fined, Again; 2011 Chrysler 300 Revealed; More Ethanol Drama”

  1. shan Says:

    Really irks me that Europe gets all the cool and sporty designed cars. I will never understand why we continue to get watered down and bland styled cars.

  2. XA351GT Says:

    Shan , my thoughts exactly. I’ll even go one better we won’t get the 2 door hatch we get 4 door versions hatch and sedan . Nobody thinks that Americans want 2 doors anymore, hard to prove otherwise when all they sell are grandpa cars.

  3. G.A.Branigan Says:

    Not only does Europe get the cool cars,they also get the better fuel efficient compact and midsize trucks.Why are we always at the bottom,especially when it’s American brands/makes??

  4. pedro fernandez Says:

    Because compared to EU we still have low fuel prices and when a country’s top selling vehicle is a V8 truck that can’t barely get 15 mpg, the demand for more fuel efficient vehicles is just not there. Unfortunately it will take $4 or $5 gas to make a difference.

  5. XA351GT Says:

    How much of that lower accident total is due to the drop in total miles being driven?? Because from my driver’s seat I don’t see people driving better as the cause. A phone or some other electronic doodad bolted to their head or hand isn’t going to help them one bit.

  6. Dale Leonard,Lakewood Ohio Says:

    Hi John,
    Note to Ford: Please,Please,Bring the RS500 to the States. I’d buy one in a heartbeat.

  7. XA351GT Says:

    In fact I find it distracting following a vehicle with a overhead DVD screen . Your eyes are drawn to it like a magnet.

  8. Steve Says:

    John I think your view on the subject of added more ethanol in gasoline is missing one big thing. That being the reduced power available per gallon of gas, resulting in decreased fuel economy. I think that’s what they fear the most given current cafe rules. I think that if they add more ethanol the octane rating should have to go up as well. Maybe then they wont have a problem of adding more ethanol into gasoline. A change for the better for once.

  9. Martin Says:

    Dale,

    I have a friend at Ford PR, I’ve told her more then once to tell Mullaly if Ford brings the RS 500 to the states, i’d trade in my R32 Volkswagen tomorrow. She just laughs and says I’ll have to make due with the new Focus ST, I tell her I’ll stick with my R32 thanks.

    Shan, I agree with you, we miss the boat over here big time. I was elated when Volkswagen announced the R32 back in 2003, and went and put a deposit on one right away.

    Its not just in small hot sports cars, we get the short end of the stick in many segments. Ford produces the Transit Connect, and everyone here says “what a great idea for the small business owner” They’ve been making that segment of cars in Europe for years. Volkswagen should be importing the Caddy with the TDI engine. That would be a great product for this segment.

    http://www.yosax.com/wp-content/uploads/volkswagen-caddy-maxi-sportline.jpg

    The US market is slowly waking up to the great european full size vans that are out there, thanks to Sprinter. I thought that we might have seen a Ram badged Iveco Daily/Fiat Ducato show up at NAIAS last year, but it was probably too soon after the Fiat buy in, Im guessing it’s only a matter of time – Maybe NAIAS in a couple weeks?

    Im surprised that VW hasnt shown up in the van market as well since Volkswagen and Mercedes build the Sprinter as a JV. Volkwagens’ “Crafter” would surely find a market here, and probably be an easy certification. Maybe there’s a non compete clause with MB in the NA market.

  10. Kit Gerhart Says:

    The European cars I’d really like to see in America are the BMW 1 series 5-door, and the M/B C-Class wagon, both with 4 cylinder diesels and manual transmission. I’ve driven a C-Class like that, and it was a great car. It drove well, had adequate power, and is quiet and comfortable on the highway. Also, it gets great MPG. Maybe the “Big Two Snobby” German car companies will re-think their American offerings when fuel reaches $5/gallon here. They both have some great, and practical products that we don’t get.

  11. InsightfulViewer Says:

    John,
    FFV credits for CAFE are capped such that the Detroit 3 are producing way more FFVs than they can get credit for, so that is not the only motivation (otherwise they would only produce enough to get the max credits). Plus, the credits phase out from 2014 through 2019 (no credits in 2020) for CAFE and essentially stop in 2016 for CO2/GHG standards. That’s on the books regardless of what happens with E15.

    A different view (or “Insight”) is this:
    The increasing ethanol usage (as required by the same Energy Independence and Security Act of 2007 that caps & phases out the FFV CAFE credits) will be hitting the “blend wall” soon such that ethanol needs to be consumed more than putting it in all gasoline at the long-standing limit of 10%. Ethanol could be consumed via E85 use in FFVs, however that would require more E85 refueling infrastructure and if the 10% limit is base gasoline is increased then that takes away the motivation to create additional E85 refueling infrastructure. So a more likely motivation of the Detroit 3 is to push E85 demand.

    This is all nice little insight for the future, however we are missing the biggest point regarding the past: This fuel can be used older vehicles (likely back to 2001, pending EPA’s upcoming decision) that were designed only to tolerate up to 10% ethanol. Consider a person with a 2001 vehicle (likely designed in the mid to late 1990′s) that uses E15 and starts to have vehicle problems. Is it because it’s at the end of it’s “useful life”, or becuase of the ethanol? The vehicle is out of warranty, new vehicle prices are increasing for the reasons you have been reporting (raw material prices, increased regulatory requirements, etc.), and the person least able to handle this financial burden (they rely on an older vehicle) is out of luck. If the government is going to go the way of Digital TV (tough luck for owners of older equipment, you must upgrade) then they should also offer financial assistance to upgrade (Cash 4 Clunkers, part II?).

  12. InsightfulViewer Says:

    Steve, good comment. If minimum octane increases with ethanol content (i.e. oil companies can’t dial down the octane in their gasoline blendstock to make it cheaper) then automakers can design engines to take advantage of the increased octane and offset the loss in energy content.

  13. tj Martin Says:

    Well I’m going to be brutally honest here , to the dismay no doubt of a few on site .

    The simple reality of most of the cars we don not get in the US is that first off , they are not suited to our roads or driving conditions , second being their reliability is not even close to the worst of US standards , and last , most are VASTLY over rated .

    Read a few of the honest and straight forward reviews of cars such as the RS500 , BMW 1 Series Hatchback etc. as well as having a chance to drive a few and you’ll quickly realize why the manufactures won’t bring those cars here .

    Simply put …. You Wouldn’t buy one and if you did you’d regret it within months . A case of ” The Grass is Always Greener …… ” until you get into the pasture yourself and realize ……… Its Just Grass .

    Believe me , other than Diesel P/U’s and SUV’s we’re not missing out on a thing .

  14. tj Martin Says:

    So when is our fine and intelligent government finally going to drop the hammer on Ford for all their Self Igniting cars , Self Destructing MiniVans ( WindStar )etc. that they waited not months … but years to finally recall . And only after multiple deaths and severe injuries .

  15. David Bardsley Says:

    Hi John, A big reason I object to E15 is that it is highly corrosive. If you put it in your car or truck and use it up in a few weeks, it’s ok. But don’t plan on leaving it in your fuel system for a few months or over the winter. Also it is very bad for outboard and marine engines (and perhaps other small motors). We used to fill up fuel tanks during winter storage to minimize the air in the tanks and the associated condensation. Now the fuel is worse than the water. Also, going to E15 is not energy or environmentally sound. Ethanol has lower energy per gallon than gasoline, it takes a lot of energy (gasoline and diesel) to produce and transport it and the diversion of corn to ethanol has raised the price of dairy and beef products. How long will it be before we can’t even purchase gasoline without dilution by ethanol? Electric cars and ethanol fueled cars are only price competitive because of government (your tax dollars) credits. Having a choice of alternative fuels is fine — but don’t shove it down our throats and don’t ask taxpayers to pay for someone else’s ego trip!

  16. Andrew Charles Says:

    John, you need to go back and read the last Energy Bill (H.R.6)—automakers do NOT get generous CAFE credits for building flex-fuel vehicles. What it calls “Dual-fuel” vehicles (running both gasoline and E85, or gasoline and CNG, or diesel and B20 etc.) get hardly any credit, AND that credit will be phased out entirely by 2019. In calculating the credit it is assumed Dual-fueled vehicles run on E85/B20/CNG only 50% of the time; the total credit earned by any manufacturer is limited to just 1.2 mpg; and after 2014 that is reduced by 0.2 mpg every year. That’s no incentive at all for anyone to make CNG, E85 or biodiesel flex-fuel vehicles.

  17. Kit Gerhart Says:

    It seems that the Navy and Marines are “going green,” and in a much more sensible way than what political forces are delivering to the rest of us. Biofuels are involved, but “ethanol from corn” is not part of the deal.

    If we really need all of the military action that is going, the Navy and Marines seem to be to be going in a very good direction toward changing the way fuels are made, delivered, and used.

    There is a great article about it at:

    http://www.nytimes.com/2010/12/19/opinion/19friedman.html?_r=1&emc=eta1

  18. Martin Says:

    tj – while i appreciate your “brutal honesty”, im kind of lost by your statement “not suited to our roads or driving conditions, second being their reliability is not even close to the worst of US standards and last, most are VASTLY over rated”

    I have had the opportunity to go to europe and drive a number of cars that aren’t available in North America. I dont know what European market cars you’ve had the opportunity to experience, but i can tell you that BMW doesnt build cars that are any less reliable for their domestic market then they do for export. They may be decontented so that things like A/C and power windows are optional, and they may offer smaller powerplants that would give them less performance then you might experience in similar cars over here, but reliability? hardly.

    As far as being suited to our roads and driving conditions, if by that you mean that they couldnt put up with the punishment of the poor conditions of some of our roads then i might have to agree. Roadways in europe are in a siginificantly better state of repair and operating condition even in the most inclement of weather.

    As far as them being VASTLY overrated, well thats a matter of opinion, and we’re all entitled to our opinions arent we. Im standing over here in the pasture tj, and the grass is just as green as it looked from the other side of the fence. As a matter of fact I think it IS greener. :-)

  19. Kit Gerhart Says:

    Two years ago I was in Luxembourg and France. I rented a Citroen C4 with a 1.6 litre diesel. A friend rented a Mercedes C-Class wagon with a 2 or 2.2 litre diesel. I drove my C4 a lot, and my friend’s C-Class a little. Both worked very well.

    The reliability of the Citroen is kind of an unknown, but there is no reason to think that the Mercedes rental would be any less reliable than the cars they sell in America now. While American roads are generally less well maintained than roads in western Europe, I seriously doubt the our roads are bad enough to destroy mainstream European cars, if they were sold here.

  20. HyundaiSmoke Says:

    Who cares? Hyundai/KIA, FoMoCo, and Maybe GM will force the others to make superior fuel efficient cars.

    We care about New tech. Who cares about Dino tech that has evolved from powertrains and platforms older than pretty much everybody in Gen Y at HonMoCo, and ToyMoCo?

    A phone from 30 years ago is nearly incompatible today. Why is 30 year old evolved car tech compatible today?

    Wish you the best of luck New Tech companies- Happy Money Making.

  21. HyundaiSmoke Says:

    Or put them out of business.

  22. Bob Says:

    Good discussion today about US vs Euro choices (and prices!). I’ll soon give you my own five cents

    Leftover from yesterday, I commented on Real (Body on frame) trucks and SUVS vs “fake” SUVS aka Crossovers unibody ones.

    Somebody pointed out to me that the Grand Cherokee is unibody, so is it a fake SUV?

    I am not sure if the JGC was always unibody, but it might. As an off road vehicle, the Jeep to choose, aka the real Jeep, is of course the WRANGLER, which is a real truck body on frame job. There are places the W can go where the GC can’t.

    But sure such girlie Jeeps as the COMPASS are really as fake SUVS as they get, and the slightly more serious PATRIOT is along the same lines (but fuel efficient and practical and not as lame as the chick fake SUV COmpass)

    Now on to more serious matters..

  23. Bob Says:

    Re the BMW 1-series 5 door, some very good friends of mine from the States rented one for a couple weeks and we met in the resort where we both have summer homes/condos. Their condo has a spectacular view, but for various reasons they had to build the whole building 3-4 feet lower than optimal, and their garage is below ground level. The husband complained that the 1-series (116) 5-door was too heavy and underpowered (was not a diesel) while the wife insisted that they need a 4WD car to get out of their semi-buried garage.

    I did like the design and styling of the 5-door 1, and I like the design of all 1′s better than that of the far more popular sales champ 3 series. But the 1 in the US is only slightly less heavy than the 3 and is no 2002 reborn!

  24. Bob Says:

    Now to the central discussion here:

    BEsides exorbitantly higher gas prices ($8 ba gallon or more) in the EU, cars are more expensive or ridiculously more expensive than the same cars imported in the US, even when the imports have much larger engines and far better performance!

    For example, on Dec 4 we were invited to dinner by a couple friends whose two kids were/are my students. The family is affluent, owns a transport business, and the couple left the restaurant in a recent vintage Porsche 911 TURBO. I did not see if it was a coupe or convertible, or a regular turbo or an S. Out of curiosity, next day I checked a local mag there for the prices, and the Turbo in its four variants costs from the high 200s (EUROS!) to 315,000 Euro ($400,000!!!!) for the Turbo S cabrio.

    Thjat’s more than TWICE the US price, and that’s just its BASE price there! Perhaps it will be cheaper in Germany, but not much cheaper, I knew a prof. in TU Berlin in Civil ENg who bought a modest Merc C280, which, with options, cost him … 100,000 DMarks!!! That’s $67,000 or so, back in 98-99.

    Now if you don’t mind used 911 turbos with low miles, you can find them at a mere $45k in the US!

  25. Bob Says:

    My own taste likes Euro designs far more than the average Big 3 product. I like the efficient hatchbacks, but in the US they are too small, and most US drivers do not need to parallel park all the time, so they are not needed here as much as over there.

    In the US people also don’t like Wagons or Minivans, and most prefer to buy 4-door sedans that offer little room for their size.

    The US ENergy Info Admin recently officially admitted that we have far, fare more natural gas int he US than previously estimated, lasting at today’s huge rate of production another 36 years (and that’s just proven, conservatively estimated reserves). Hence Picken’s commendable proposal to reconfigure US 18-wheelers to use CNG.

    The only CNG car offered in the US was a tiny 4 door civic, whose small trunk lost half its tiony capacity due to the damned CNG cylinder.

    A civic WAGON, and especially a TALL civic wagon (60+ inch high) would be FAR better for CNG, AND would have all the space of the sedan and its cargo room or more, or even a longer RANGE than the 300 or so limes of the sedan CNG.

  26. Bob Says:

    But I agree with TJ MArtin and others that it is a REAL SHAME that we don’t have the OUTSTANDING CLEAN MODERN DIESELS they got in Europe, except for their bigger versions and in very few cars in the US.

    I HOPE the Auto Illiterates in WASH DC and Sacramento finally See the light, that if you want 60 MPG (IE 40 or so EPA MPG average) by 2025, and you don’t make small clean modern diesels the MAJORITY of car and ESPECIALLY Truck and SUV sales in the US,

    it Wontgonnahappen.com as the Autoextremist sez.

    DIESELS, DIESELS, DIESELS!

  27. dcars Says:

    I was in France for a couple of weeks and all these cool euorpean cars that are mentioned are few and far between. the roads were littered with Twingos, Smarts, Transits Connects and Matizs. These cars are awful and few US consumers would buy them. Their all over the place, parked sideways, clogging the narrow streets and choking pedestrians with detuned diesel engines. I’d much rather have a Camaro, mustang or Challenger. I’ve heard it a million times, “why don’t we get these hot hatches.” for good reasons we don’t want their crappy over priced little cars. Americans like their cars and they want them to be reliable, that is something that the europeans would love to have over their.

  28. Dan Miller Says:

    Mr. McElroy’s cynical criticism of car makers for opposing E15 is profoundly ignorant!

    Design and material changes are necessary to accomodate E85, some of them fairly costly, such as stainless steel components in the fuel system. Thus a vehicle must be designed especially for that fuel.

    Simply because standard vehicles can accomodate E10 does not mean that a 50% increase to E15 is OK for all of those vehicles. In fact, higher ethanol content is known to cause serious engine durability problems, even in concentrations as low as 15%, on vehicles not designed specifically for high ethanol concentrations!

  29. Dan Miller Says:

    BTW- Those “highly desirable” euro cars many commenters long for are vying for only 5% of the U.S. market!
    There is no money in small cars and not much volume either!

  30. pedro fernandez Says:

    Remember, the grass is always greener on the other side.

  31. pedro fernandez Says:

    Try selling small cars or ‘hot” hatches in oil rich and cheap gas places like the Arab peninsula and Venezuela or Russia, they’re taking in our discarded Hummers and big SUV’s