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Episode 85 – Saab Files for Bankruptcy, Driving Tax Proposed, Chery Unveils Plug-In EV

February 20th, 2009 at 12:00pm

Runtime 6:15

Saab has filed for bankruptcy and wants to concentrate all operations back in Sweden. The new secretary of Transportation is considering taxing drivers on how many miles they drive. Chery joins the race to come out with a plug-in electric. All that and more, plus a preview of this week’s episode of Autoline Detroit where we talk about GM and Chrysler’s viability plans.

Transcript and Story Links after the jump . . .

Here are today’s top headlines. Saab is filing for bankruptcy. You may get taxed on how many miles you drive your car. And Chery joins the race to come out with a plug-in electric.

Up next, we’ll be back with the news behind the headlines.

This is Autoline Daily for Friday, February 20, 2009. And now, the news.

Yesterday we reported that it could happen, and today it did. Saab has filed for bankruptcy. It wants to concentrate all design, engineering and manufacturing back in Sweden, and try to get the financing to recapitalize the company. But it’s hard to see how it can survive. Last year Saab only sold just under 94,000 cars worldwide. That’s well under half the capacity of one assembly plant, and you can’t build a global car company around half of an assembly plant.

The Associated Press reports that the new secretary of Transportation, Ray LaHood, is considering the introduction of a tax on vehicle miles driven. With the recession and with future fuel economy regulations expected to lower the use of gasoline and diesel, the government is worried about falling revenues from the gas tax. So it’s exploring the idea of dropping the gas tax and taxing how many miles you drive, instead. Look for an uproar to arise since this would involve GPS systems on cars tracking how many miles they’ve driven.

Just in case drivers aren’t distracted enough, the electronics division of Mitsubishi is building a compact Blu-ray disk player that’ll fit right in a car’s dashboard. Besides being able to play high-definition DVDs, the company is also working on getting the system to pickup terrestrial TV broadcasts. It’ll be in the market within the year.

Everyone’s racing to get electric vehicles to market, and China’s Chery may be one of the first to offer a plug-in. Gasgoo.com reports that the company rolled out an EV called the S18. It claims to have a range of 150 kilometers or roughly 94 miles with a top speed of 75 miles an hour. It uses iron-phosphate-based lithium-ion batteries, and is expected to carry a sticker price of less than $15,000 when introduced within a year.

Porsche just celebrated the opening of its brand new museum in Stuttgart, Germany, even though it actually opened last month. It has more than 200 exhibits and holds up to 80 vehicles, including classic Porsche’s and motorsports vehicles. Porsche expects more than 200,000 visitors per year.

Rolls-Royce will unveil a concept at the Geneva Motor Show in a few weeks, called the 200EX. It’s a four door sedan that Rolls-Royce says will be the direction in design for its RR4 model that begins production in 2010. There aren’t too many details yet about the 200EX but it’s equipped with a new V12 and rides on 20 inch tires.

Coming up next, a preview of this week’s episode of Autoline Detroit where we talk about the viability plans GM and Chrysler submitted to the Feds. We’ll be back right after this.

This week on Autoline Detroit I’m joined by three industry colleagues – John Stoll from the Wall Street Journal, Tom Walsh of the Detroit Free Press and Jim Hall of 2953 Analytics. In the following preview clip we discuss some of the industry-wide problems caused by a stumbling U.S. economy.

If you want to hear the rest of my discussion with these industry experts you can watch the entire episode of Autoline Detroit on our website right now.

And that’s it for today’s show, but since it’s Friday that means I have to announce the winner of this week’s trivia contest. We challenged you to name all the different automakers that GM’s vice chairman and product czar Bob Lutz, has worked for. And the correct answer is, four. Bob Lutz has worked for GM, Chrysler, Ford and BMW.

As always my crack team has randomly selected today’s winner from the pool of correct responses. Pookie, the envelope please! What, no Pookie? Anyway, this week’s winner is… Delora Garland of Sherwood, Arkansas! Congratulations Delora, you’ve just won a beautiful hardcover book all about the history of Italdesign.

And that brings us to the end of today’s show, but don’t forget, you can get podcasts, transcripts and a whole lot more on our website, AutolineDaily.com. Thanks for watching, we’ll see you next week.

23 Comments to “Episode 85 – Saab Files for Bankruptcy, Driving Tax Proposed, Chery Unveils Plug-In EV”

  1. G.A.Branigan Says:

    Kudos to SAAB.You said you were going under…..and you did,no drawnout hoopla and drama.94k units worldwide is pretty sad,guess you don’t build stuff people want.The US wants to tax us on miles we drive,okay,providing you don’t invade my privacy by TRACKING me.Our citizens has had enough of our rights trampled on for the last 8 years so you had better rethink how to do this because I will fight you.And finaly,just what already distracted drivers need in our world of cell phones and the even worse texting while driving is a high def tv in the dash for our driving and viewing pleasure.I know,it won’t work while driving right? Then what is the point? What ever happened to “paying attention”???

  2. Dave Kopitzke Says:

    So the new tax for miles system requires GPS. No problem. The government will supply us with coupons. We know that works.

  3. Kit Gerhart Says:

    The idea of a “mileage tax” on driving is the exact opposite of what we need. If there is a goal of reducing use of imported oil, the obvious thing to do is raise gas taxes, both to bring in money for roads, but also to encourage conservation of fuel. A mileage tax would minimize the significance of fuel cost, and encourage use of inefficient vehicles.

    In the distant future when electric and other alternative fuel vehicles make up a major part of the fleet, a replacement for gas tax will obviously be needed, but we are years away from that day.

  4. pedro Fernandez Says:

    Great, more distractions for drivers, I am seeing more and more rear end collisions due to driver inattention. And it will only get worst.

  5. Dave Kopitzke Says:

    Is the goal reducing the use of imported oil? I don’t think we can make that assumption.

  6. G.A.Branigan Says:

    I just noticed….GM stock is at $1.54.Wow.

  7. Dave Kopitzke Says:

    GM stock is worth 1 Billion. In 1929 it was worth 4 Billion.

  8. Laura Oliveto Says:

    I think a trip to the Porsche Museum should be the prize for a future Trivia Quiz :)

  9. Laura Oliveto Says:

    Moderator: please take out the second “prize” THX

  10. jesse M. Says:

    taxes,taxes,taxes..the politicians answer to all of our ills!!What a joke!!Mileage tax indeed.

  11. Kit Gerhart Says:

    The purpose of implementing a “mileage tax” would obviously be to raise money, presumably to build and repair transportation infrastructure. The view is widely held, though, and among people of all political stripes, that it would be desirable to reduce oil imports. Increasing fuel taxes has that effect by encouraging conservation, while also bringing in money to build and repair transportation infrastructure.

    It also seems that there would be a lot of issues involved with putting a mileage tax in place. How, for example, would they make sure I carried my GPS mile counter whenever I rode one of my 5 motorcycles?

  12. Andy Says:

    SO, with a mileage tax a fuel sucking SUV is taxed at the same rate as a fuel efficient vehicle that is driven the same miles/year.

    Might as well drive fuel sucking SUV’s again….

  13. G.A.branigan Says:

    A reliable/non-tracking way to do this would be thru yearly re-registrations dividing the miles driven per reg calendar year by 12 then charging a monthly road tax/fuel tax based on last years driving.I don’t think I would mind the tax so much if a good portion of it goes to a statewide(your state here) bio fuel production
    facility/network.Just a thought.

  14. Howard Remeta Says:

    Where is the incentive to drive a fuel efficient vehicle with the mileage tax? How would they monitor it completely? Would they make 100,000,000 GPS units? Raising the gas tax is the easiest to monitor and the fairest. Drive an SUV, pay more. Drive a fuel efficient vehicle, pay less. This also ecourages us to drive fuel efficient vehicles to lessen our dependence on foreign oil.

  15. Salvador G. Says:

    I’m glad to inform everyone that the Tax mile idea was drop this afternoon, it was already announce by the press secretary, he said that Pres. Obama its not going for it.

  16. pedro Fernandez Says:

    Heavy trucks and equipment is what damages roads, not cars or light trucks, raise the gas tax if you must, spescially premium gas. Only expensive, high performance cars need it anyway

  17. Jim Foley Says:

    If I’m going to pay high gasoline prices then I want FREE health care provided from those taxes like Canada, UK, etc.

  18. Joe Nagy Says:

    The upcoming Rolls Royce concept 200EX is a real peach, beautiful looking vehicle. Look close; doesn’t it remind you a bit of the ’61>66 Lincon Continentals, really what the Lincons’ should look like now, but alas, what can you say.

    Again, just one car nut’s opinion, best regards from Florida,

    Joe Nagy.

  19. Carfan77 Says:

    Politicians of all parties are generally clueless, or conniving, power-hungry thieves. The ‘mileage tax’ was a blatant attempt at privacy invasion. I don’t like taxes, but accept that infrastructure is generally better handled at the government level. A better solution is a percentage tax on fuel, so that the tax rises as gas prices rise. That is the only way to sustain revenue levels to maintain an existing infrastructure when demand falls. It also makes the people who use the roads pay for the roads…as long as the taxes actually go to the roads, and not some bogus, subsidized mass transit.

  20. Mike Stones Says:

    Saab can’t build a global car company on 94,000 sales annually? Porche seems to manage on 96,000 while acquiring VW in the process!

  21. Tom Martin Says:

    Now is the time to develop an alternative to the current tax per gallon. Electric and plugin hybrids should not go tax free.

    I think fuel efficent cars would pay less taxes. I suspect the mileage tax would be in addition to the gas/gallon tax. Even if the Fed dropped the federal tax, there still would be state and local taxes on gas and diesel.

    And the Fed could use different tax rates depending on the vehicles’ combined mpg.

    However, installing a GPS appears infeasible to me.

    States with safety or emissions inspections could record the odometer reading. Other states could use self-reporting. Even if a person underreported, the odometer would be read when the car is sold and all taxes paid. The problem with this is that the odometer will need to be pamper proof.

  22. John McElroy Says:

    @Mike:

    Need to compare revenues, too.

    Porsche’s 94,000 vehicles = about $8 bllion

    Saab’s 96,000 = about $2.5 billion

  23. David Sprowl Says:

    Tax on miles driven. I can see trucking already crushed by operating cost going down even further. And now big brother wants to watch were I am and how long it took me to get there. What is next, tickets via GPS for speeding? This is bad policy period.