Episode 684 – GM Smart-Grid Tech, LEAF Pricing Increased, Convertible Demand Drops

July 20th, 2011 at 12:03pm

Runtime: 9:31

GM and OnStar will launch a pilot program for smart-grid technology for EVs later this year. Nissan announced it’s increasing the price of the LEAF because it now comes standard with a battery warmer, heated steering wheel, and heated seats. Sales of convertibles in the U.S. dropped after the economy crashed a few years ago. All that and more, plus John answers questions about Audi and the UAW in the “You Said It!” segment.


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This is Autoline Daily for July 20, 2011.

There’s quite a bit of electric-car news today, so let’s get started. GM and OnStar will launch the first real-world smart grid for EVs later this year. The pilot program in Raleigh, North Carolina will give utilities insight into how and where electric vehicles are charged as well as the impact this has on the grid. Hundreds of employees at energy companies throughout the region will drive leased Chevy Volts. OnStar will track the cars’ electrical consumption via a feature called ATOMS, which is short for Advanced Telematics Operations Management System. The data will help utilities forecast demand and determine the best locations to put charging stations.

In related Volt news, GM restarted production of the extended-range electric at its plant in Hamtramck, Michigan. 2012 models are now rolling off the line . . . or maybe I should say FLYING off the line. According to The Detroit News, assembly halted for about a month as the company retooled to make room for the 2013 Malibu. This helped triple, yes, TRIPLE Volt production! Hopefully this will help GM catch up with demand. Only one in nine Chevy dealers that sell the car have one in stock.

What’d I tell you? Still more EV news! Toyota’s hybrid technology will help ease electricity shortages in Japan. How? Well, about 40 Prius cars are being fitted with special power systems that should allow people run appliances from the juice stored in the batteries. Think of them as big, expensive but very mobile emergency generators.

And in related EV news, Nissan announced it’s increasing the number of markets where it will sell the LEAF in the U.S. . . . as well as the price. The base car now starts at $35,200.  That’s $2,500 more than before. The higher-trim model starts at $37,250, $3,530 more than before. Both models now come standard a battery warmer, heated steering wheel and heated seats in both the front and rear. The high-trim model also gets a fast-charging plug. Interestingly, last month GM cut the price of the Volt by $1,000 by dropping Bose speakers and the navigation system. The base Volt now costs just under 40 grand.

Speaking of Nissan . . . a number of automakers are claiming their compact cars can get 40 miles per gallon on the highway. But we ran into Larry Dominique, the head of product planning for Nissan in North America, who points out that just looking at the highway number may not be the best way to judge which car gets the best fuel economy.

Traditionally convertibles have made up around 2 percent of the U.S. market, but ever since the economy crashed a few years ago, demand for convertibles went south with it. According to Polk, last year convertibles only made up 1.2 percent of the market. Sales have improved this year, increasing 3 percent compared to last, but this is way behind the overall automotive market, which is up over 15 percent compared to last year. In other words, convertibles are losing market share. The top three selling convertibles in the U.S. through May this year are the Chevy Camaro, Ford Mustang and the Mercedes-Benz E-Class.

And in yet another sign the U.S. economy is slowly getting back on its feet, Harley-Davidson more than doubled its net profit in the most-recent quarter. And it was able to do that because its motorcycle sales in the U.S. were up for the first time in nearly five years. The company says consumers are still skittish about the economy, but prices of used motorcycles are so strong, more people are buying new ones. Harley’s overseas sales were also up, but not as strongly as in the U.S.

Coming up next, it’s time for You Said It!

And now it’s time for some of your feedback.

Mark wrote in to say, “John, on your review of the A8, I couldn’t help but notice how huge and oversized the grille is. Do you think the styling trend of oversized grilles has run its course and fuel economy standards will push makers to cleaner noses on their cars?”

No Mark, I think this giant grille thing is just getting going. It’s a way for an automaker to have its cars instantly recognized. As cars get more aerodynamic one way to keep them distinct is with bold front ends. And you’d be surprised how aerodynamic those big grilles can be.

MJB also had something to say about Audis. He says, “I’m gonna have to take your word for it that Audis have ‘The Best’ interiors. Because I just don’t see it.”

Well, MJB, in my view BMWs have somewhat coarse looking interiors, Mercedes-Benz is just starting to look dated to my eye, Cadillac can look a touch busy. And while Lexus does have a rich-looking interior, Audi just seems to do the best blend of modern, luxury and design.

Cwolf says, “Your suggestion about the UAW receiving profit sharing in the form of stock has my gears turning. On the negative side, stocks are speculative. However, there may be an advantage for higher income trades (people). Cashing in the stock at a tax rate of 15 percent just may result in a honey of a deal.”

That’s a great point, Cwolf. I also think that management would be far more generous if they paid profit sharing to line workers in stock, instead of cash. After all, it’s a lot easier for a company to print shares of stock.

ItsmeBill saw our report on the Chrysler workers caught partying on their lunch break and says, “Some of my good friends are UAW & they are great. It’s the ‘dudes’ like those in this story that bring everyone else down to their level and whom the union goes out of their way to protect.”

I’m not sure if the union goes out of its way to protect these workers, but it was disappointing that their fellow UAW workers who turned them in had to go to a local television station to get any action, rather than go through the union or the company.

G.A. Branigan also weighed in on this issue. “I don’t care who smokes weed, hell I do and I’m legal. But doing anything where you work is wrong on every level. Maybe someone should check ol Sergio Macaroni and see if he blazes one or more at work. That would seem to make sense.”

Well, G.A., I sincerely doubt that Sergio is smoking weed on the job. And while there may well be white-collar people who are doing it, the Chrysler line-workers got caught because they were blatantly doing it every day out in the open.

If you missed the LIVE Open Line call this month, don’t forget that you can listen to the podcast version now at bit.ly/OpenLine. Michelle Naranjo and Chelsea Sexton interview Mark Dill from the Indianapolis Motor Speedway about what it’s doing to make racing green. And mark your calendars for the next show with GM’s marketing chief Joel Ewanick, on Tuesday, August 2 at 8 p.m. Eastern Time. It’s all at bit.ly/OpenLine.

And that’s today’s report, thanks for watching, we’ll see you tomorrow.

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27 Comments to “Episode 684 – GM Smart-Grid Tech, LEAF Pricing Increased, Convertible Demand Drops”

  1. pedro fernandez Says:

    Larry D is right about those lofty highway 40 mpg being thrown around too much, avg number is much more important. By Nissan raising the price of the “Leaf”, the “Volt” should do better once they get production up and dealers stop trying to sell them for up to $20k over MSRP. Why do I keep hearing here that the economy is getting up on its feet and improving? everywhere else I read or even look around, it looks pretty bad and getting worse not better.

  2. Kit Gerhart Says:

    As far as these 40 mpg cars, the “real” highway mileage you get depends greatly on how fast you go. My Prius gets a little over 50mpg at 65 mph, but about 45mpg at 75mph. My MINI behaves similarly, except the numbers are smaller, and the not-so-aero MINI’s mileage drops off more as speed increases.

    As far as all these Hyundais, Cruze Ecos, Focuses, etc. with 40 mph EPA highway ratings, all of them should get 40 mpg at a steady 60 mph, but most of them will be well under that at 75.

  3. Chuck Grenci Says:

    Of course Larry D is right (and pontificated about it) because his car looked good; hadn’t it, and you wouldn’t have heard a peep. Now looking at the numbers, even though his is class leading, the differences between the others are so close that his decry is only superfically correct; certainly driver imput is worth a pretty good percentage of result (as Kit stated).

    Maybe Nissan ‘low balled’ the Leaf to take some attention away from the ‘pricey’ Volt; seems that they are getting close enough now that consumers will pick the one they really want (between the two, I would pick Volt, hands down).

  4. pedro fernandez Says:

    First off, if you do a lot of driving on the highways, most likely you want a larger more comfortable vehicle, Second, most folks do mixed city/highways but thanks to congestion, the ideal steady 60mph is a pipe dream most of the time, so those 40 mpg numbers are really deceiving.

  5. Julius Lambert Says:

    Stick with the HEART LAND ———-BABY

  6. Lex Says:

    Larry D is correct, the Combined MPG of a vehicle is more important than it’s City & Highway MPG for most people. This is why the high cost of the Volt and Leaf is unjustifible in the minds to most consumers. Looking back at all the R&D and Production Costs that GM invested in the Volt, it would have made more sense for GM to offer a Voltec Version of the Cruze without having to create a whole new vehicle. The same could be said of the Nissan Leaf. A Leaf Powertrain incorporated into a Sentra or Versa would have been cheaper an done the same job.

    The Chevy Cruze could have been offered as either an LS, LT1, LT2, LTZ, Eco or EV. This would have either reduced the costs of the Cruze and/or improved the quality of materials incorporated into the Cruze. If GM was looking for the Volt to be it’s Halo Car then you can’t fault them. However the Halo price is what will keep customers away. Consumers will pick ICE powered vehicles with comparable MPG at half the cost to fulfill their transportational needs.

    I believe Smart’s EV will be a successful if they keep the initial cost of ownership low, especially in urban environments.

  7. Kit Gerhart Says:

    Much better than for Chevy to offer an electric Cruze, would be for them to sell a non-electric Volt, with that utilitarian, low-drag hatchback body. How about a diesel (non) Volt, with the Volt body?

  8. pedro fernandez Says:

    Lex, Kit, do you think Toyota would have sold as many hybrids if they had used the Corolla instead of building an exclusive car for it like they did with the Prius. Honda failed to move many Civic hybrids. BTW I don’t agree on the Smart EV selling well at all, it’s the range anxiety thing.

  9. Chuck Grenci Says:

    Pedro…………bingo; had the prius internals been installed in a Corolla, low impact; in a defining shape (along with good technology), HIT.

  10. John Says:

    Good CNG NEWS with Environmental Protections:

    Texas Legislation Establishes Natural Gas Transportation Corridor
    July 18, 2011 | USA, Denton TX

    Three bills

    * Senate Bill 20 establishes a natural gas transportation corridor in the rapidly expanding Texas Triangle, which encompasses Austin, Dallas/Fort Worth, Houston and San Antonio, by increasing the number of natural gas-refuelling stations, supporting the use of natural gas-powered trucks across the state.

    * Senate Bill 527 provides funds through the Texas Emissions Reduction Plan for 20 new air monitors in the 16-county Barnett Shale region, which includes Denton.

    * House Bill 3328 requires hydraulic fracturing operators to disclose the chemical constituents of fluids used in the fracturing process on a well-by-well basis.


  11. Kit Gerhart Says:

    For two reasons, I would not have bought a Prius, had it been a Corolla. That big reason is that the US Corolla is not available as a hatchback. Also, while a Corolla with a Prius power train should match, or nearly match the city mpg of a Prius, it would not get the highway mileage of the Prius, with its low drag body. I have three Prius-driving friends, and at least two of them would not have bought a Corolla hybrid for the same reasons I wouldn’t have bought one.

    I think the Prius-specific body has made the car a big seller for multiple reasons. The best-in-the-US-market gas mileage is a major appeal for all Prius buyers. The hatchback utility is an important thing to some of us. There are also a certain number of people who want to be seen in them because of the “technogeek” and “greenie” image they present. That is not why I bought one, nor is it the reason two of my friends bought them, but I’m sure it is a factor in some Prius sales.

    I suspect the bottom line is, had the Prius been a hybrid Corolla, it would sell about like a Civic hybrid, unless it got considerably better mpg than the Honda, in which case it would have sold better than the Honda. The specific body, though, has a lot to do with Prius selling about as many units as all other US-market hybrids combined.

  12. Kit Gerhart Says:

    As I’ve mentioned before, I would have considered a car with a Prius body, but without the hybrid power train, depending on the price and mpg of such a car, were it sold.

  13. Lex Says:

    The Prius and Insight are not appealing to me.
    “B” or “C” Class Vehicles employing some mix of EV and ICE Technologies at a comparable cost to a standard vehicle is attractive to me.

    I wonder if any OEM has attempted to employ a very small displacement ICE running at a constance level to generate electricity to be stored in existing low tech batteries? A Roof mounted solar panel could also be added to a EV to aid in achieving class leading MPG and reduce range anxiety. These Solar Panel options could be added to EV’s in those areas of the country where sunshine is plentiful.

    The Volt is a very good start, however the initial cost of ownership is a real turn-off to most consumers. The major reason for the initial high cost of EV’s is the batteries.
    If the batteries can be scaled downward to reduce vehicle weightand cost, this should improve their acceptance.

    I do not think running on pure battery stored electric for 20 miles is such a great thing. Being about to get 70 miles of traveling distance out a single gallon of gasoline is a great thing!

    We have all seen those College Student projects which convert standard cars into EV’s. What is happening on College Campus today regarding EV technology?

    This might be a great topic for Autoline or AAH.

  14. cwolf Says:

    More News: NPR reported this A.M. that a handful of japanese suppiers of specifically shared parts amoung many of japans brands are accused of price fixing. Only goes to show ya that treatchery lerks in every corner. If things aren’t bad enough over there!

    I’m not sure if Nissans increases are a result of inflation,initial under-pricing or of less than expected demand. Earlier, one of us made mension of Nissans plans to back-out of the Michigan battery deal which included a +/-million bucks. Does anyone know if the money has to still be returned to the govt?

    How much longer will the $7500 EV rebates last? If it is not on-going for several years, the triple increase in volt production may give all the volts a dealer can park in the lot and only to remain there.

    MJB: Your POV is respected,so let’s find a common ground within the auto industry and have fun with it.

    Note: Always fun to here your name in John Mc’s “You Said It”, but understand the sale of auto stock would be only advantageous to others sharing my financial situation. For most workers, or for anyone at the present,investing or holding anyones auto shares is just too much of a risk! Too much competition, too many suppliers,besides all other worldly events, makes it too much of a gamble for any potential rewards.

  15. Kit Gerhart Says:

    re #13,
    I find it hard to understand why anyone would NOT find a Prius appealing. Compared to 4 cylinder versions of Fusion, Camry, Sonata, etc., a comparably equipped Prius costs the same, it has about comparable passenger comfort for 5 people, it is MUCH BETTER for carrying items other than people, it uses barely over half as much gas in city driving, and it uses only about 2/3 as much gas in highway driving. I guess aerodynamic, “technogeek” styling is a real turnoff to some people.

  16. Alex Kovnat Says:

    > This helped triple, yes, TRIPLE
    > Volt production! Hopefully this
    > will help GM catch up with demand.

    The reason so many people are buying the Volt is, us taxpayers are subsidizing it! It may well be that the Cruze is more cost-effective as a way to reduce our nation’s CO2 footprint. It may well be also, that if Uncle Sam were to subsidize natural gas powered versions of the Honda Civic, we might likewise get more CO2-reduction for our tax dollars.

  17. GPL Says:

    “Compared to 4 cylinder versions of Fusion, Camry, Sonata, etc., a comparably equipped Prius costs the same”

    I haven’t compared equipment, but I’m seeing base prices of those sedans about $3000 cheaper than that of the Prius, and that’s not even considering incentives and transaction price, which I’m sure are better on the sedans.

    To your other point, yes, I believe aesthetics is the primary driver. The sedan format is far more popular in the US. I think I read somewhere that when Ford built the Focus in four formats in the US (3,4,5 door and wagon), the four-door accounted for 80% of sales. That’s apples-to-apples, and the sedan crushed the others in sales while offering the least utility.

  18. Dan Clemons Says:

    Who would want a car built by a bunch of drunks?

  19. John Says:

    When will we stop dreaming about out of reach, expensive, “range anxiety” EVs, and focus on the abundant alternative fuel and its refueling infrastructure for a cost effective solution for the ICE ?

    “Study says U.S. shale may weaken Iran, Russia”

    July 20, 2011, 7:51PM

    “The study challenges the notion that the U.S. natural gas shale is a short-lived phenomenon. It concludes domestic production will more than quadruple by 2040, from 2010 levels, and account for more than half of all U.S. gas production by the 2030s.

    ‘Game changing’

    “The idea that shale gas is a flash-in-the-pan is simply incorrect,” ”


  20. pedro fernandez Says:

    In think the upcoming Prius plug-in extended hybrid is gonna take sales from the Volt. Soon we may see Volts sitting a dealers lots

  21. John Says:


    What is it going to cost ?


  22. Kit Gerhart Says:

    @GPL # 17,
    Yeh, I was talking about MSRP which, now, is very unrealistic regarding Prius. No one has any of the them in stock. When I bought my Prius a year ago, there was a $1000 incentive. My, how an earthquake and northward creeping gas prices change things.

    The ~$24K Fusion/Camrys, also Accords I’m comparing are ones I saw when I was with a friend who was car shopping a few days ago. They were 4 cylinder automatic with a few minor options like floor mats, but not much alse. I think the Fusion had a power driver seat, which my car does not, but a base Prius has automatic temp control and keyless operation, which the Fusion et. al. do not. Anyway, current transaction prices would be much lower on the generic sedans than a Prius. Sorry about my misleading post.

    Regarding the popularity of sedans in America, I never understood it, but that’s certainly the way it is. With efficiency/practicality nuts like myself, things are different. Prius, a hatchback, is by far the best selling hybrid in the US, and in the case of that other high mpg car, TDI Volkswagen, the Golf hatch and Jetta wagon have a much higher percentage TDI installation than the Jetta sedan.

  23. Kit Gerhart Says:

    “When will we stop dreaming about out of reach, expensive, “range anxiety” EVs,”

    Range anxiety is certainly part of the equation with CNG cars too, only the range is much longer than for an EV. It would seen that there is an easy solution, though. Why not make cars like the CNG Civic “duel fuel” so they will run on either CNG or gasoline. That should be easy to do.

  24. pedro fernandez Says:

    Kit, I think the problem that people see with hatchbacks is that they provide little privacy and security as far as putting valuables in the back. With a trunk you can’t see what’s in there unlike a hatchback where thieves may find it easier to break the back glass than to open a lock, I don’t think that should keep me from getting a hatch, I had my trunk broken in and had some expensive equipment stolen years ago.

  25. Kit Gerhart Says:

    Most, or all of today’s hatches come with a cover which blocks the view of what’s in the cargo area. These provide “visual security,” but would provide little physical security if you break into the car. These covers generally hinge at the top of the back seat, and hang from the hatch when the hatch is open. They are easy to remove, and I always remove them when I get a new car, because things are more convenient without the cover, but, so far, I’ve had them removed from both my Prius and MINI for the entire time I’ve had the cars.

    If I were going on a trip with the back seat not folded, I might be inclined to re-install the cover for its security benefit.

  26. John Says:

    @ Kit,

    “Why not make cars like the CNG Civic “duel fuel” so they will run on either CNG or gasoline. That should be easy to do. ” …

    I support that 100%.

    Excellent Thought.

  27. pedro fernandez Says:

    Looks like the UAW is gonna make Audi forget about Tenn for their new plant and look to Mexico instead, Wow!!! this gets worst by the day.